Par Pacific (NYSE:PARR) executives used the company’s fourth-quarter earnings call to highlight what CEO Will Monteleone described as “meaningful progress” in 2025, including record refining throughput, record profits in the logistics and retail segments, and a materially stronger balance sheet following proceeds from its Hawaii renewables joint venture and continued share repurchases.
2025 results and priorities
Monteleone said the company entered 2025 with four priorities: executing major turnaround activity safely and on schedule, minimizing the impact from a Wyoming crude heater event, advancing and starting up the Hawaii renewables unit, and delivering cost reductions. He said the company “largely achieved those objectives” despite a volatile refining backdrop.
Operational performance: record throughput, site-level details
EVP of Refining and Logistics Richard Creamer said the refining and logistics team delivered “another record throughput year” of 188,000 barrels per day, led by higher rates in Hawaii. He also cited Montana’s “largest-ever turnaround” and said that after the event the site posted record quarterly throughput of 58,000 barrels per day.
Monteleone pointed to sustained improvement in Hawaii operations, with 2025 throughput averaging 84,000 barrels per day, about 4% above the prior three-year average. Creamer said fourth-quarter combined throughput was 191,000 barrels per day, with the following site-level details:
- Hawaii: 87,000 barrels per day; production costs of $4.15 per barrel.
- Washington: 37,000 barrels per day; production costs of $4.57 per barrel, reflecting reduced rates ahead of planned first-quarter downtime. Creamer said maintenance activities are complete and the restart is underway.
- Wyoming: 14,000 barrels per day; production costs of $13.27 per barrel, elevated by a third-party power outage in northern Wyoming and lower seasonal throughput.
- Montana: 52,000 barrels per day; production costs of $11.74 per barrel, elevated by about $1.50 per barrel due to coker maintenance.
For the first quarter, management provided throughput expectations by site, resulting in a system-wide anticipated midpoint of 182,000 barrels per day. Creamer guided to Hawaii at 85,000–89,000 barrels per day; Washington at 24,000–28,000 barrels per day reflecting the planned outage; Wyoming at 13,000–16,000 barrels per day; and Montana at 52,000–56,000 barrels per day.
Margins, capture rates, and early 2026 market commentary
CFO Sean Flores said fourth-quarter adjusted EBITDA was $113 million and adjusted net income was $60 million, or $1.17 per share. Refining segment adjusted EBITDA was $88 million in the quarter, down from the third quarter (excluding SRE impact), as the combined refining index averaged $13.13 per barrel, about $1.60 lower sequentially due to seasonal conditions in the Rockies and Pacific Northwest.
Flores said system-wide refining capture was 93% for the quarter and 94% for the full year. He detailed several factors affecting capture at individual refineries:
- Hawaii: Singapore 3-1-2 averaged $21.43 per barrel; landed crude differential was $6.05, implying a Hawaii Index of $15.38 per barrel. Capture was 104%, including a net $7 million loss from product crack hedging and price lag; excluding those items, capture was 110%.
- Montana: Index averaged $11.14 per barrel, with capture of 72%. Flores said elevated asphalt sales and a lighter crude slate due to coker downtime reduced margins by about $10 million, and production costs included roughly $7 million related to coker maintenance.
- Wyoming: Index averaged $18.31 per barrel; normalized capture was about 70% excluding a $3 million FIFO impact. Flores said a regional power outage and subsequent maintenance reduced throughput and impacted both margins and costs, including an estimated $4 million hit from lower diesel sales and $3 million in higher operating costs.
- Washington: Index averaged $8.60 per barrel with 97% capture, reflecting normalization of jet-to-diesel spreads and favorable sales mix during an Olympic pipeline outage in November.
Looking at conditions early in the first quarter, Flores said the combined refining index had averaged about $6.70 per barrel quarter-to-date, with February improving by roughly $2 per barrel versus January. He also said prompt distillate margins in the Rockies and Pacific Northwest strengthened by about $15 per barrel compared with January averages, while tighter jet balances on the West Coast supported margin capture in Washington. In Hawaii, he said Singapore distillate cracks remained firm, and Par Pacific expected its first-quarter crude differential to be $4.75–$5.25 per barrel on easing backwardation and improved access to waterborne supply.
Hawaii renewable fuels project and joint venture proceeds
Monteleone said the Hawaii renewable fuels project progressed into commissioning and early start-up phases during the fourth quarter. He said the company successfully achieved on-specification feedstock with a range of inputs in the pretreatment unit and expected to introduce post-treated feedstocks into the renewables unit “in the next few weeks.” While timing extended modestly beyond original expectations, he said there were “no material operational issues,” and the focus remained on safe startup, stability, and optimization toward steady-state performance.
He also pointed to fourth-quarter proceeds from the Hawaii renewables joint venture as a key factor in improving liquidity.
Balance sheet, capital allocation, and other updates from Q&A
Management repeatedly emphasized improved financial flexibility. Flores said Par Pacific ended the year with record total liquidity of $915 million and gross term debt of about $640 million, placing leverage at the low end of the company’s targets. He also said the company reduced shares outstanding to 49.7 million, down 10% during the year, and lowered gross debt by $310 million.
Cash flow from operations for the full year was $568 million, excluding working capital outflows of $21 million and deferred turnaround costs of $101 million. Fourth-quarter cash from operations was $134 million, excluding working capital outflows of $40 million and deferred turnaround costs of $1 million. Flores said working capital outflows in the quarter were driven by prepaid annual insurance premiums and trade credit timing in Hawaii, partially offset by RIN proceeds. He added the company had monetized “less than half” of its SRE-related excess RIN inventory at year-end, which he said provided favorable working capital visibility into 2026.
In financing activities, Flores said Par Pacific paid down $163 million on its ABL, repurchased $28 million of shares, and received $100 million in proceeds from the Hawaii renewables joint venture. He also said the company repriced its term loan during the quarter, reducing the spread by 50 basis points and lowering annual cash interest by more than $3 million.
During Q&A, management reiterated a flexible capital allocation approach that can include share repurchases, internal projects, and potential external opportunities. Monteleone said the company is focused on growing the business “when it’s accretive” and finding opportunities that are synergistic with its existing portfolio, while cautioning that growth “at any price” can destroy shareholder value. He said small retail acquisitions and new builds have been areas where the company can be competitive, while “larger scale M&A in retail is less likely” given competitors’ cost of capital.
Monteleone also addressed two other items raised by analysts. On its Hawaii land position, he said Par Pacific is continuing redevelopment efforts and “nearing completing” steps to rehabilitate the asset, but he suggested investors should not expect an immediate benefit, describing it as a multi-year project. On the company’s 46% stake in Laramie, he said it remains non-core, but Par Pacific has influence rather than control, and management’s view is to align with partners to maximize value rather than sell a minority non-controlling position.
In a separate exchange, Monteleone discussed the company’s sensitivity to the Western Canadian Select (WCS) differential, stating that at mid-cycle, running roughly 40,000–50,000 barrels per day of WCS implies about $15 million–$16 million per year of impact for each $1 widening. He also said Par Pacific could be an indirect beneficiary of incremental Venezuelan barrels entering the Gulf Coast as flows influence Canadian crude differentials back toward a “mid-cycle range” of about $15–$16 under WTI.
In closing remarks, Monteleone said the company’s objective remains “to increase the mid-cycle earnings power and grow the free cash flow per share over time through disciplined execution,” and he reiterated 2026 priorities that include improving Rocky Mountain mid-cycle earnings through targeted projects, executing a Hawaii turnaround, and successfully starting up and optimizing the renewable fuels unit.
About Par Pacific (NYSE:PARR)
Par Pacific Holdings, Inc (NYSE: PARR) is a diversified downstream energy company engaged in the refining, marketing and logistics of petroleum products. Through its subsidiaries, Par Pacific operates the Par Hawaii Refinery on the island of Oʻahu, which processes crude oil into transportation fuels such as gasoline, diesel and jet fuel, as well as asphalt, petroleum coke and sulfur. In the Rocky Mountain region, the company owns and operates the Salt Lake City Refinery in Utah and associated logistics infrastructure, including pipelines and storage terminals, to support both crude supply and product distribution.
In marketing its refined products, Par Pacific maintains a network of branded and unbranded wholesale accounts across Hawaii and the U.S.
