Par Pacific NYSE: PARR reported second-quarter results that management said were driven by elevated refining margins, high system throughput and commercial execution during a volatile market environment.
Adjusted EBITDA totaled $571 million in the quarter, while adjusted net income was $499 million, or $10.10 per share, CFO Shawn Flores said. Refining adjusted EBITDA rose to $552 million from $69 million in the first quarter as crude and refined-product supply disruptions supported market conditions.
The company’s combined refining index averaged about $33 per barrel, compared with $12.40 per barrel for the full year 2025 and roughly $14 per barrel higher than in the first quarter. System-wide refining capture was 125%, or 112% after normalizing for Hawaii price-lag effects and Wyoming FIFO impacts.
Refining performance varied by region
President and CEO Will Monteleone said refined-product cracks remained materially above historical norms during the quarter. He attributed the favorable environment to reduced Persian Gulf and Russian refined-product exports, conservative refining runs in Asia and policies that restricted free trade. He added that global refined-product inventories remain tight.
At the Hawaii refinery, second-quarter throughput was 73,200 barrels per day and production costs were $6.43 per barrel. The refinery’s Hawaii index was approximately $46 per barrel, based on a Singapore 3-1-2 benchmark of about $50 per barrel and a landed crude differential of $3.93 per barrel.
Hawaii capture was 124%, including a net price-lag benefit of approximately $77 million, or $11.49 per barrel. Excluding that impact, Hawaii capture was 99%.
Par Pacific’s Tacoma, Washington, refinery set a quarterly production record, processing 41,200 barrels per day at 98.1% utilization. Washington production costs were $4.21 per barrel, while its refining index averaged $20.27 per barrel and capture was 100%.
In Montana, throughput was 53,000 barrels per day and production costs were $10.16 per barrel. The refinery completed an April crude-unit outage safely, on time and on budget, according to EVP of Refining and Logistics Richard Creamer. During May and June, the Montana operation reached monthly throughput of approximately 62,000 barrels per day and operating expenses of $7.56 per barrel.
Wyoming throughput was 14,000 barrels per day, reflecting an April outage, and production costs were $15.28 per barrel. Its refining index averaged $28.73 per barrel, with margin capture of 118%.
Hawaii turnaround largely complete
The Hawaii refinery began a plant-wide turnaround in late June. Creamer said the work was substantially complete, with the crude unit and reformer returning on a roughly 30-day schedule. Mechanical work on the hydrocracker was completed, with catalyst activation and startup underway during the call.
“The cost and schedule all came in close range to target,” Creamer said, adding that there were no significant issues.
The company expects the turnaround’s financial impact to be concentrated in the third quarter. Flores said the company built refined-product inventories through imports late in the second quarter, but most of those barrels will be costed in the third quarter. Hawaii capture is expected to fall below the company’s typical normalized range of 100% to 110%, and operating expenses should rise marginally, though most turnaround expenditures are capitalized.
For the third quarter, Par Pacific projected Hawaii conventional throughput of 59,000 to 65,000 barrels per day and renewable throughput of 1,500 to 2,000 barrels per day. Mainland guidance calls for throughput of 40,000 to 42,000 barrels per day in Washington, 17,000 to 20,000 barrels per day in Wyoming, and 56,000 to 61,000 barrels per day in Montana. The Montana coker was down in July for routine maintenance and was expected to return by mid-August.
The company’s third-quarter midpoint throughput guidance was 182,000 barrels per day. Flores said the July consolidated refining index was $31.34 per barrel, about $1.60 below the second-quarter average.
Renewables, retail and cash flow
Par Pacific’s renewable diesel business ramped during the quarter, with June throughput reaching approximately 3,000 barrels per day before the Hawaii turnaround. The company also completed its first commercial renewable diesel sales, although Monteleone said volumes were small and reflected the early stage of the commercial ramp.
Retail adjusted EBITDA rose to $17 million from $15 million in the first quarter, helped by a partial recovery in fuel margins and continued food-service sales growth. Same-store fuel volumes declined 0.8% from the second quarter of 2025, while in-store sales increased 1%.
Cash from operations totaled $614 million, excluding working-capital outflows of $312 million and deferred turnaround costs of $19 million. About half of the working-capital outflow was related to building refined-product inventories in Hawaii ahead of the turnaround, Flores said. The company expects a substantial portion of the outflows to reverse as inventory levels normalize and commodity prices stabilize.
Debt reduction and capital allocation
During the quarter, Par Pacific completed a $500 million senior unsecured notes offering. The transaction reduced gross term debt by more than $130 million, while the company also reduced asset-based lending borrowings by $78 million. Total net debt declined by more than $220 million.
As of June 30, the company had approximately $1.4 billion of total liquidity and $185 million of cash. Par Pacific repurchased about $48 million of common stock year to date through the second quarter, including cash-settled options, but management said it moderated share repurchases during the quarter in favor of debt reduction.
Monteleone said the company’s capital-allocation approach remains dynamic, spanning acquisitions, internal growth investments and share repurchases. He said Par Pacific is developing smaller refining and logistics projects that could produce unlevered returns in the low-20% range.
Flores also said the company had an approximately $700 million net operating loss balance at the end of 2025 and expects to use a substantial portion of it during 2026. If current margins persist, Par Pacific could move to a more typical federal tax position beginning in 2027.
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.
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