Western Refining Reports Fourth Quarter and Full Year 2013 Results

Western Refining Reports Fourth Quarter and Full Year 2013 Results

  *Completed IPO of Western Refining Logistics, LP
  *Acquired general partner interests in Northern Tier Energy LP
  *Paid fourth quarter dividend of $0.22 per share

EL PASO, Texas, Feb. 27, 2014 (GLOBE NEWSWIRE) -- Western Refining, Inc.
(NYSE:WNR) today reported fourth quarter 2013 net income, excluding special
items, of $57.3 million, or $0.60 per diluted share. This compares to fourth
quarter 2012 net income, excluding special items, of $155.7 million, or $1.45
per diluted share. Including special items, the Company recorded fourth
quarter 2013 net loss attributable to Western Refining, Inc. of $7.3 million,
or $(0.09) per diluted share as compared to net income of $207.6 million, or
$1.92 per diluted share for the fourth quarter of 2012. The special items for
the fourth quarter of 2013 primarily included a non-cash unrealized pre-tax
hedging loss of $100.6 million. Western's financial results reflect the
consolidation of financial results of both Western Refining Logistics, LP
(NYSE:WNRL), a fee-based master limited partnership of which Western owns the
general partner and approximately 65% of the limited partnership interests and
Northern Tier Energy LP (NYSE:NTI), a variable distribution master limited
partnership of which Western owns the general partner and 38.7% of the limited
partnership interests.

For the year ended December 31, 2013, the Company reported net income,
excluding special items, of $313.7 million, or $3.15 per diluted share as
compared to net income, excluding special items, of $552.3 million, or $5.08
per diluted share for the year ended December 31, 2012. Including special
items, Western recorded full year 2013 net income attributable to Western
Refining, Inc. of $276.0 million, or $2.79 per diluted share compared to full
year 2012 net income of $398.9 million, or $3.71 per diluted share.

A reconciliation of reported earnings and description of special items can be
found in the accompanying financial tables.

The Company successfully completed a number of strategic initiatives during
2013:

  *began operation of the crude gathering system in the fast-growing Permian
    Basin
  *expanded crude oil gathering capabilities in the Four Corners region
  *completed the IPO of Western Refining Logistics, LP
  *completed the strategic investment in Northern Tier Energy LP
  *returned $305.3 million in cash to shareholders from dividends and share
    repurchases

Jeff Stevens, Western's President and Chief Executive Officer, said, "Western
had a truly transformational year in 2013. In the fourth quarter, we continued
to benefit from our refinery locations which have both direct pipeline access
to cost-advantaged crude oils and service areas with strong refined product
values. We launched WNRL as a platform to grow our logistics business, and
acquired NTI to further diversify our asset base and expand our direct
pipeline access to cost-advantaged crude sources. We also implemented a number
of successful capital projects and returned cash to shareholders. We will
continue to focus on growing the earnings power of the Company and delivering
long-term shareholder value."

Excluding WNRL and NTI, total debt as of December 31, 2013, was $1,108.2
million and cash was $298.3million resulting in net debt of $810.0million.

Stevens concluded, "We successfully achieved our ambitious goals that we set
for 2013.As we look to the first quarter of 2014, we are seeing widening
Midland/Cushing differentials, similar to what we saw in early 2013.We
continue to grow our logistics business by expanding our direct pipeline
access to cost-advantaged crude oils from some of the fastest growing basins
in North America.As always, we will continue to focus on safety and
reliability while continuing to increase value to our shareholders."

Conference Call Information

The management teams of Western Refining and Northern Tier Energy will hold a
joint conference call to discuss financial results for the fourth quarter and
full year ending December 31, 2013.The conference call is scheduled for
Thursday,February27, 2014, at 10:00 a.m. ET. A slide presentation will also
be available for reference during the conference call. The call, press release
and slide presentation can be accessed on the Investor Relations section on
Western's website, www.wnr.com. The call can also be heard by dialing (866)
566-8590 or (702) 224-9819, passcode: 31406191. The audio replay will be
available two hours after the end of the call through March 6, 2014, by
dialing (800) 585-8367 or (404) 537-3406, passcode: 31406191.

Non-GAAP Financial Measures

In a number of places in the press release and related tables, we have
excluded the impact of gains, losses,and impairments on disposal of assets,
the impact of the non-cash unrealized net gains and losses from our commodity
hedging activities and the non-cash loss on extinguishment of debt. We believe
it is useful for investors to understand our financial performance excluding
these items so that investors can see the operating trends underlying our
business. Investors should not consider these non-GAAP measures in isolation
from, or as a substitute for, the financial information that we report in
accordance with GAAP.

About Western Refining

Western Refining, Inc. is an independent refining and marketing company
headquartered in El Paso, Texas. The refining segment operates refineries in
El Paso, and Gallup, New Mexico. The Wholesale segment includes a fleet of
crude oil and finished product truck transports, and wholesale petroleum
products operations in Arizona, California, Colorado, Georgia, Maryland,
Nevada, New Mexico, Texas, and Virginia. The retail segment includes retail
service stations and convenience stores in Arizona, Colorado, New Mexico, and
Texas.

Western Refining, Inc. owns the general partner and approximately 65% of the
limited partnership interest of Western Refining Logistics, LP
(NYSE:WNRL).Western Refining, Inc. also owns the general partner and
approximately 39% of the limited partnership interest in Northern Tier Energy
LP (NYSE:NTI).

More information about Western Refining is available at www.wnr.com.

Cautionary Statement on Forward-Looking Statements

This press release contains forward-looking statements covered by the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. The
forward-looking statements contained herein include statements about: our
commitment to return cash to shareholders; continued focus on safety and
reliability; expectations for margins; growth of crude production in basins in
North America; our ability to access cost-advantaged crude sources; ability to
realize anticipated benefits of our acquisitions and strategic initiatives;
the continued growth of our logistics capabilities; the attractiveness of our
refinery locations; budgeted capital expenditures and the effectiveness of
such capital expenditures; and the impact of the Midland/Cushing price
differential on our El Paso refinery crude oil acquisition costs. These
statements are subject to the general risks inherent in the Company's
business. These expectations may or may not be realized. Some of these
expectations may be based upon assumptions or judgments that prove to be
incorrect. In addition, our business and operations involve numerous risks and
uncertainties, many of which are beyond our control, which could result in our
expectations not being realized, or otherwise materially affect our financial
condition, results of operations, and cash flows. Additional information
relating to the uncertainties affecting Western's business is contained in its
filings with the Securities and Exchange Commission. The forward-looking
statements are only as of the date made, and Western does not undertake any
obligation to (and expressly disclaims any obligation to) update any forward
looking statements to reflect events or circumstances after the date such
statements were made, or to reflect the occurrence of unanticipated events.

Consolidated Financial Data

The following tables set forth our summary historical financial and operating
data for the periods indicated below:

                                 Three Months Ended    Year Ended
                                 December 31,          December 31,
                                 2013 (4)   2012       2013 (4)    2012
                                 (In thousands, except per share data)
Statements of Operations Data                                    
Net sales (1)                     $3,022,281 $2,248,257 $10,086,070 $9,503,134
Operating costs and expenses:                                    
Cost of products sold (exclusive
of depreciation and amortization) 2,728,532  1,710,775  8,690,222   8,054,385
(1)
Direct operating expenses
(exclusive of depreciation and    164,641    122,813    523,836     483,070
amortization) (1)
Selling, general and              52,252     34,545     137,031     114,628
administrative expenses
(Gain) loss on disposal of        2,035      —          (4,989)     (1,891)
assets, net
Maintenance turnaround expense    4,151      13,763     50,249      47,140
Depreciation and amortization     38,638     24,799     117,848     93,907
Total operating costs and         2,990,249  1,906,695  9,514,197   8,791,239
expenses
Operating income                  32,032     341,562    571,873     711,895
Other income (expense):                                          
Interest income                   205        136        746         696
Interest expense and other        (21,939)   (17,419)   (68,040)    (81,349)
financing costs
Amortization of loan fees         (1,899)    (1,641)    (6,541)     (6,860)
Loss on extinguishment of debt    (1)        —          (46,773)    (7,654)
Other, net                        1,822      (278)      2,214       359
Income before income taxes        10,220     322,360    453,479     617,087
Provision for income taxes        6,012      (114,773)  (153,925)   (218,202)
Net income                        16,232     207,587    299,554     398,885
Less net income attributed to     23,560     —          23,560      —
non-controlling interest
Net income (loss) attributable to $(7,328)   $207,587   $275,994    $398,885
Western
Basic earnings (loss) per share   $(0.09)    $2.35      $3.35       $4.42
Diluted earnings (loss) per share $(0.09)    $1.92      $2.79       $3.71
(2)
Weighted average basic shares     79,720     87,589     82,248      89,270
outstanding
Weighted average dilutive shares  79,720     110,250    104,904     111,822
outstanding
Cash Flow Data                                                   
Net cash provided by (used in):                                  
Operating activities              $92,880    $320,056   $442,293    $916,353
Investing activities              (756,703)  (71,418)   (897,025)   18,506
Financing activities              760,752    (304,515)  468,835     (651,721)
Other Data                                                       
Adjusted EBITDA (3)               $179,494   $298,463   $754,839    $1,083,669
Capital expenditures              57,888     71,434     205,677     202,157
Balance Sheet Data (at end of                                    
period)
Cash and cash equivalents                             $468,070    $453,967
Working capital                                       451,094     559,213
Total assets                                          5,517,920   2,480,407
Total debt and lease financing                        1,411,517   499,863
obligation
Total equity                                          2,570,587   909,070

(1)Excludes $1,024.8million, $4,277.8million, $1,099.0million, and
$4,909.4million of intercompany sales; $1,012.0million, $4,265.0million,
$1,096.4million, and $4,901.5million of intercompany cost of products sold;
and $4.1million, $12.8million, $2.6million and $7.9million, of
intercompany direct operating expenses for the three and twelve months ended
December31, 2013 and 2012, respectively.

(2)Our computation of diluted earnings(loss) per share potentially includes
our Convertible Senior Notes and our restricted shares and share units. If
determined to be dilutive to period earnings, these securities are included in
the denominator of our diluted earnings per share calculation. For purposes of
the diluted earnings (loss) per share calculation, we assumed issuance of
0.2million restricted shares and share units and assumed issuance of
22.5million shares related to our Convertible Senior Notes for the twelve
months ended December31, 2013. Our Convertible Senior Notes and our
restricted shares and share units were determined to be anti-dilutive for the
three months ended December31, 2013 and as such were not included in our
computation of diluted earnings (loss) per share. We assumed issuance of
0.6million and 0.5million restricted shares and share units for the three
and twelve months ended December31, 2012, respectively, and assumed issuance
of 22.1million shares related to the Convertible Senior Notes, respectively
for both periods.

(3) Adjusted EBITDA represents earnings before interest expense and other
financing costs, amortization of loan fees, provision for income taxes,
depreciation, amortization, maintenance turnaround expense, and certain other
non-cash income and expense items. However, Adjusted EBITDA is not a
recognized measurement under United States generally accepted accounting
principles ("GAAP"). Our management believes that the presentation of Adjusted
EBITDA is useful to investors because it is frequently used by securities
analysts, investors, and other interested parties in the evaluation of
companies in our industry. In addition, our management believes that Adjusted
EBITDA is useful in evaluating our operating performance compared to that of
other companies in our industry because the calculation of Adjusted EBITDA
generally eliminates the effects of financings, income taxes, the accounting
effects of significant turnaround activities (that many of our competitors
capitalize and thereby exclude from their measures of EBITDA), and certain
non-cash charges that are items that may vary for different companies for
reasons unrelated to overall operating performance.

Adjusted EBITDA has limitations as an analytical tool, and you should not
consider it in isolation, or as a substitute for analysis of our results as
reported under GAAP. Some of these limitations are:

  *Adjusted EBITDA does not reflect our cash expenditures or future
    requirements for significant turnaround activities, capital expenditures,
    or contractual commitments;
  *Adjusted EBITDA does not reflect the interest expense or the cash
    requirements necessary to service interest or principal payments on our
    debt;
  *Adjusted EBITDA does not reflect changes in, or cash requirements for, our
    working capital needs; and
  *Adjusted EBITDA, as we calculate it, may differ from the Adjusted EBITDA
    calculations of other companies in our industry, thereby limiting its
    usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA should not be considered a
measure of discretionary cash available to us to invest in the growth of our
business. We compensate for these limitations by relying primarily on our GAAP
results and using Adjusted EBITDA only supplementally. The following table
reconciles net income to Adjusted EBITDA for the periods presented:

                                       Three Months Ended Twelve Months Ended
                                       December31,       December31,
                                       2013 (4)  2012     2013 (4) 2012
                                       (In thousands)
Net income (loss) attributable to       $(7,328)  $207,587 $275,994 $398,885
Western
Net income attributed to                23,560    —        23,560   —
non-controlling interest
Interest expense and other financing    21,939    17,419   68,040   81,349
costs
Amortization of loan fees               1,899     1,641    6,541    6,860
Provision for income taxes              (6,012)   114,773  153,925  218,202
Depreciation and amortization           38,638    24,799   117,848  93,907
Maintenance turnaround expense          4,151     13,763   50,249   47,140
Loss (gain) on disposal of assets, net  2,035     —        (4,989)  —
Loss on extinguishment of debt          1         —        46,773   7,654
Unrealized loss (gain) on commodity     100,611   (81,519) 16,898   229,672
hedging transactions
Adjusted EBITDA                         $179,494  $298,463 $754,839 $1,083,669

(4)The information presented includes the results of operations of NTI
beginning November 12, 2013, the date the transactions contemplated by the
Purchase Agreement were consummated. Additionally, the information presented
includes the financial results for WNRL from the period beginning October 16,
2013 through the year ended December 31, 2013.

Consolidating Financial Data

The following tables set forth our consolidating historical financial data for
the periods presented below.

                                      Three Months Ended Year Ended
                                      December 31,       December 31,
                                      2013      2012     2013       2012
                                      (In thousands, except per share data)
Operating Income (Loss)                                           
Refining                               $7,503    $350,777 $565,107   $735,742
Wholesale                              5,346     9,953    29,539     31,011
Retail                                 893       2,974    10,103     16,111
Corporate and other                    (27,985)  (22,142) (79,151)   (70,969)
Total Western                          $(14,243) $341,562 $525,598   $711,895
WNRL (1)                               8,917     —        8,917      —
NTI (2)                                37,358    —        37,358     —
Operating income                       $32,032   $341,562 $571,873   $711,895
                                                                 
Depreciation and Amortization                                     
Total Western                          $25,222   $24,799  $104,432   $93,907
WNRL (1)                               2,676     —        2,676      —
NTI (2)                                10,740    —        10,740     —
Depreciation and amortization expense  $38,638   $24,799  $117,848   $93,907
                                                                 
Capital Expenditures                                              
Total Western                          $47,194   $71,434  $194,983   $202,157
WNRL (1)                               2,810     —        2,810      —
NTI (2)                                7,884     —        7,884      —
Capital expenditures                   $57,888   $71,434  $205,677   $202,157
                                                                 
Balance Sheet Data (at end of period)                             
Cash and cash equivalents                                         
Total Western                                           $298,256   $453,967
WNRL                                                    84,000     —
NTI                                                     85,814     —
Cash and cash equivalents                               $468,070   $453,967
                                                                 
Total debt                                                        
Total Western                                           $1,108,238 $499,863
WNRL                                                    —          —
NTI                                                     278,369    —
Total debt                                              $1,386,607 $499,863
                                                                 
Total debt to capitalization ratio (3)                  55.3%      35.5%
                                                                 
Total working capital                                             
Total Western                                           $259,082   $559,213
WNRL                                                    85,182     —
NTI                                                     106,830    —
Total working capital                                   $451,094   $559,213

(1)WNRL financial data represents financial results for the period beginning
October 16, 2013 through December31, 2013.

(2)NTI financial data represents financial results for the period beginning
November 12, 2013 through December31, 2013.

(3)Calculation of total debt to capitalization ratio excludes NTI debt of
$278.4million and total equity of$1,676.5million attributable to
non-controlling interest.

Refining Segment

El Paso and Gallup Refineries and Related Operations

                                  Three Months Ended    Year Ended
                                  December31,          December31,
                                  2013       2012       2013       2012
                                  (In thousands, except per barrel data)
Statement of Operations Data:                                    
Net sales (including intersegment  $1,919,619 $1,923,146 $7,693,829 $8,340,178
sales)
Operating costs and expenses:                                    
Cost of products sold (exclusive
of depreciation and amortization)  1,804,050  1,446,878  6,656,778  7,133,308
(5)
Direct operating expenses
(exclusive of depreciation and     74,391     83,123     312,497    320,659
amortization)
Selling, general and               7,128      7,858      28,485     27,136
administrative expenses
(Gain) loss on disposal of         2,025      —          (4,999)    (1,382)
assets,net
Maintenance turnaround expense     4,151      13,763     50,249     47,140
Depreciation and amortization      20,371     20,747     85,712     77,575
Total operating costs and expenses 1,912,116  1,572,369  7,128,722  7,604,436
Operating income                   $7,503     $350,777   $565,107   $735,742
Key Operating Statistics                                         
Total sales volume (bpd) (1)       184,790    173,726    176,653    184,086
Total refinery production (bpd)    154,908    149,842    147,793    147,461
Total refinery throughput (bpd)    157,252    152,280    150,429    149,809
(2)
Per barrel of throughput:                                        
Refinery gross margin (3) (5)      $7.99      $34.00     $18.89     $22.01
Refinery gross margin excluding    13.87      30.74      18.87      28.40
hedging activities (3) (5)
Refinery gross margin excluding    9.82       34.00      19.37      22.01
fees paid to WNRL (3) (6)
Gross profit (3) (5)               6.58       32.51      17.33      20.60
Direct operating expenses (4)      5.14       5.93       5.69       5.85
Direct operating expenses          5.45       5.93       5.38       5.85
including WNRL expenses (4) (7)

El Paso and Gallup Refineries

                                   Three Months Ended Year Ended
                                   December 31,       December 31,
                                   2013      2012     2013    2012
Key Operating Statistics                                    
Refinery product yields (bpd):                              
Gasoline                            81,821    78,516   78,568  76,536
Diesel and jet fuel                 62,852    61,497   59,580  61,224
Residuum                            5,616     5,873    5,445   5,655
Other                               4,619     3,956    4,200   4,046
Total refinery production (bpd)     154,908   149,842  147,793 147,461
Refinery throughput (bpd):                                  
Sweet crude oil                     124,460   119,187  117,289 115,345
Sour or heavy crude oil             24,907    26,665   25,195  24,792
Other feedstocks and blendstocks    7,885     6,428    7,945   9,672
Total refinery throughput (bpd) (2) 157,252   152,280  150,429 149,809

El Paso Refinery

                                           Three Months Ended Year Ended
                                           December31,       December31,
                                           2013      2012     2013    2012
Key Operating Statistics                                            
Refinery product yields (bpd):                                      
Gasoline                                    66,323    64,637   61,893  61,669
Diesel and jet fuel                         56,244    55,056   52,600  54,600
Residuum                                    5,616     5,873    5,445   5,655
Other                                       3,858     3,417    3,442   3,280
Total refinery production (bpd)             132,041   128,983  123,380 125,204
Refinery throughput (bpd):                                          
Sweet crude oil                             101,538   98,184   93,654  94,404
Sour crude oil                              24,907    26,665   25,195  24,792
Other feedstocks and blendstocks            7,278     5,936    6,488   7,734
Total refinery throughput (bpd) (2)         133,723   130,785  125,337 126,930
Total sales volume (bpd) (1)                148,437   142,671  141,894 151,352
Per barrel of throughput:                                           
Refinery gross margin (3) (5)               $13.85    $30.77   $18.74  $28.25
Refinery gross margin excluding fees paid   15.30     30.77    19.13   28.25
to WNRL (3) (6)
Direct operating expenses (4)               3.97      4.36     4.30    4.50
Direct operating expenses including WNRL    4.26      4.36     4.38    4.50
expenses (4) (7)

Gallup Refinery

                                             Three Months Ended Year Ended
                                             December31,       December31,
                                             2013      2012     2013   2012
Key Operating Statistics                                             
Refinery product yields (bpd):                                       
Gasoline                                      15,498    13,879   16,675 14,867
Diesel and jet fuel                           6,608     6,441    6,980  6,624
Other                                         761       539      758    766
Total refinery production (bpd)               22,867    20,859   24,413 22,257
Refinery throughput (bpd):                                           
Sweet crude oil                               22,922    21,003   23,635 20,941
Other feedstocks and blendstocks              607       492      1,457  1,938
Total refinery throughput (bpd) (2)           23,529    21,495   25,092 22,879
Total sales volume (bpd) (1)                  36,353    31,055   34,759 32,718
Per barrel of throughput:                                            
Refinery gross margin (3) (5)                 $14.43    $30.26   $18.94 $28.25
Refinery gross margin excluding fees paid to  17.89     30.26    19.76  28.25
WNRL (3) (6)
Direct operating expenses (4)                 11.24     11.43    10.13  9.60
Direct operating expenses including WNRL      12.18     11.43    10.36  9.60
expenses (4) (7)

(1)Sales volume includes sales of refined products sourced primarily from our
refinery production as well as refined products purchased from third parties.
We purchase additional refined products from third parties to supplement
supply to our customers. These products are similar to the products that we
currently manufacture and represented 14.44% and 13.83% of our total
consolidated sales volumes for the years ended December31, 2013 and 2012,
respectively. The majority of the purchased refined products are distributed
through our wholesale refined product sales activities in the Mid-Atlantic
region where we satisfy our refined product customer sales requirements
through a third-party supply agreement.

(2) Total refinery throughput includes crude oil, other feedstocks and
blendstocks.

(3)Refinery gross margin is a per barrel measurement calculated by dividing
the difference between net sales and cost of products sold by our refineries'
total throughput volumes for the respective periods presented. Net realized
and net non-cash unrealized economic hedging gains and losses included in the
combined refining segment gross margin are not allocated to the individual
refineries. Cost of products sold does not include any depreciation or
amortization. Refinery gross margin is a non-GAAP performance measure that we
believe is important to investors in evaluating our refinery performance as a
general indication of the amount above our cost of products that we are able
to sell refined products. Each of the components used in this calculation (net
sales and cost of products sold) can be reconciled directly to our statement
of operations. Our calculation of refinery gross margin may differ from
similar calculations of other companies in our industry, thereby limiting its
usefulness as a comparative measure.

The following table reconciles combined gross profit for all refineries to
combined gross margin for all refineries for the periods presented:

                                  Three Months Ended    Year Ended
                                  December31,          December31,
                                  2013       2012       2013       2012
                                  (In thousands, except per barrel data)
Net sales (including intersegment  $1,919,619 $1,923,146 $7,693,829 $8,340,178
sales)
Cost of products sold (exclusive   1,804,050  1,446,878  6,656,778  7,133,308
of depreciation and amortization)
Depreciation and amortization      20,371     20,747     85,712     77,575
Gross profit                       95,198     455,521    951,339    1,129,295
Plus depreciation and amortization 20,371     20,747     85,712     77,575
Refinery gross margin              $115,569   $476,268   $1,037,051 $1,206,870
Refinery gross margin per refinery $7.99      $34.00     $18.89     $22.01
throughput barrel (4)
Gross profit per refinery          $6.58      $32.51     $17.33     $20.60
throughput barrel (4)

(4)Refinery direct operating expenses per throughput barrel is calculated by
dividing direct operating expenses by total throughput volumes for the
respective periods presented. Direct operating expenses do not include any
depreciation or amortization.

(5)Cost of products sold for the combined refining segment includes the net
realized and net non-cash unrealized hedging activity shown in the table
below. The hedging gains and losses are also included in the combined gross
profit and refinery gross margin but are not included in those measures for
the individual refineries.

                                   Three Months Ended  Year Ended
                                   December 31,        December 31,
                                   2013      2012      2013     2012
                                   (In thousands)
Realized hedging gain (loss), net   $15,465   $(35,932) $17,714  $(120,805)
Unrealized hedging gain (loss), net (100,611) 81,519    (16,898) (229,672)
Total hedging gain (loss), net      $(85,146) $45,587   $816     $(350,477)

(6)For the quarter and year ended December 31, 2013, cost of products sold
for the combined refining segment includes $17.8million and $8.7million from
the El Paso and Gallup refineries, respectively, with no comparable activity
in prior periods. Concurrent with the closing of its initial public offering
on October 16, 2013, WNRL entered into fee-based commercial and service
agreements with Western under which it operates assets contributed by Western
for the purpose of generating fee-based revenues. Under these agreements, WNRL
provides various pipeline, gathering, transportation, terminalling and storage
services to Western and Western pays fees to WNRL based on minimum monthly
throughput volumes of crude oil and refined and other products, and reserved
storage capacity. Most of WNRL's assets are integral to the operations of
Western's El Paso and Gallup refineries.

(7)Direct operating expenses including WNRL expenses per throughput barrel
includes $5.9million and $2.0million of WNRL directing operating expenses
associated with El Paso and Gallup refinery operations, respectively.

Wholesale Segment

                                  Three Months Ended    Year Ended
                                  December 31,          December 31,
                                  2013       2012       2013       2012
                                  (In thousands, except per gallon data)
Statement of Operations Data                                     
Net sales (including intersegment  $1,161,076 $1,120,455 $4,779,489 $4,860,291
sales)
Operating costs and expenses:                                    
Cost of products sold (exclusive   1,133,889  1,091,538  4,667,371  4,748,077
of depreciation and amortization)
Direct operating expenses
(exclusive of depreciation and     17,792     15,176     67,137     67,491
amortization)
Selling, general and               2,936      2,800      11,385     10,407
administrative expenses
(Gain) on disposal of assets,net  —          —          —          (509)
Depreciation and amortization      1,113      988        4,057      3,814
Total operating costs and expenses 1,155,730  1,110,502  4,749,950  4,829,280
Operating income                   $5,346     $9,953     $29,539    $31,011
Operating Data                                                   
Fuel gallons sold                  392,534    356,183    1,550,154  1,520,581
Fuel gallons sold to retail        63,444     62,937     254,907    244,906
Average fuel sales price per       $3.08      $3.28      $3.20      $3.32
gallon
Average fuel cost per gallon       3.03       3.21       3.15       3.27
Fuel margin per gallon (1)         0.06       0.08       0.06       0.07
                                                                
Lubricant gallons sold             2,854      2,811      11,793     11,492
Average lubricant sales price per  $11.71     $11.11     $11.28     $11.15
gallon
Average lubricant cost per gallon  10.41      10.06      10.07      10.05
Lubricant margin (2)               11.1%      9.5%       10.8%      9.9%
                                                                
Realized hedging loss              $ —        $ —        $ —        $(23,643)

                                                       
                                  Three Months Ended    Year Ended
                                  December 31,          December 31,
                                  2013       2012       2013       2012
                                  (In thousands, except per gallon data)
Net Sales                                                        
Fuel sales (including intersegment $1,207,523 $1,167,674 $4,965,856 $5,054,987
sales)
Excise taxes included in fuel      (89,304)   (85,861)   (355,865)  (355,957)
sales
Lubricant sales                    33,421     31,232     133,082    128,171
Other sales (including             9,436      7,410      36,416     33,090
intersegment sales)
Net sales                          $1,161,076 $1,120,455 $4,779,489 $4,860,291
Cost of Products Sold                                            
Fuel cost of products sold         $1,188,381 $1,144,503 $4,882,430 $4,970,965
Excise taxes included in fuel cost (89,304)   (85,861)   (355,865)  (355,957)
of products sold
Lubricant cost of products sold    29,719     28,269     118,744    115,540
Other cost of products sold        5,093      4,627      22,062     17,529
Cost of products sold              $1,133,889 $1,091,538 $4,667,371 $4,748,077
Fuel margin per gallon (1)         $0.06      $0.08      $0.06      $0.07

(1) Fuel margin per gallon is a measurement calculated by dividing the
difference between fuel sales and cost of fuel sales for our wholesale segment
by the number of gallons sold. Fuel margin per gallon is a measure frequently
used in the petroleum products wholesale industry to measure operating results
related to fuel sales.

(2)Lubricant margin is a measurement calculated by dividing the difference
between lubricant sales and lubricant cost of products sold by lubricant
sales. Lubricant margin is a measure frequently used in the petroleum products
wholesale industry to measure operating results related to lubricant sales.

Retail Segment

                                     Three Months Ended Year Ended
                                     December 31,       December 31,
                                     2013      2012     2013       2012
                                     (In thousands, except per gallon data)
Statement of Operations Data                                     
Net sales (including intersegment     $252,915  $303,672 $1,177,098 $1,212,070
sales)
Operating costs and expenses:                                    
Cost of products sold (exclusive of   219,320   268,835  1,039,130  1,074,532
depreciation and amortization)
Direct operating expenses (exclusive  27,519    27,054   107,950    102,793
of depreciation and amortization)
Selling, general and administrative   2,388     2,194    8,401      8,161
expenses
Depreciation and amortization         2,795     2,615    11,514     10,473
Total operating costs and expenses    252,022   300,698  1,166,995  1,195,959
Operating income                      $893      $2,974   $10,103    $16,111
Operating Data                                                   
Fuel gallons sold                     75,076    75,024   302,759    291,244
Average fuel sales price per gallon   $3.24     $3.47    $3.41      $3.56
Average fuel cost per gallon          3.06      3.27     3.23       3.36
Fuel margin per gallon (1)            0.18      0.20     0.18       0.20
                                                                
Merchandise sales                     $61,745   $61,481  $253,096   $248,023
Merchandise margin (2)                28.9%     28.5%    28.8%      29.0%
Operating retail outlets at period                     228        222
end

                                                       
                                     Three Months Ended Year Ended
                                     December 31,       December 31,
                                     2013      2012     2013       2012
                                     (In thousands, except per gallon data)
Net Sales                                                        
Fuel sales (including intersegment    $243,092  $260,294 $1,032,478 $1,036,404
sales)
Excise taxes included in fuel sales   (29,466)  (29,091) (118,015)  (111,805)
Merchandise sales                     61,745    61,481   253,096    248,023
Other sales                           (22,456)  10,988   9,539      39,448
Net sales                             $252,915  $303,672 $1,177,098 $1,212,070
Cost of Products Sold                                            
Fuel cost of products sold            $229,669  $245,105 $976,589   $978,979
Excise taxes included in fuel cost of (29,466)  (29,091) (118,015)  (111,805)
products sold
Merchandise cost of products sold     43,887    43,988   180,284    176,215
Other cost of products sold           (24,770)  8,833    272        31,143
Cost of products sold                 $219,320  $268,835 $1,039,130 $1,074,532
Fuel margin per gallon (1)            $0.18     $0.20    $0.18      $0.20

(1)Fuel margin per gallon is a measurement calculated by dividing the
difference between fuel sales and cost of fuel sales for our retail segment by
the number of gallons sold. Fuel margin per gallon is a measure frequently
used in the convenience store industry to measure operating results related to
fuel sales.

(2)Merchandise margin is a measurement calculated by dividing the difference
between merchandise sales and merchandise cost of products sold by merchandise
sales. Merchandise margin is a measure frequently used in the convenience
store industry to measure operating results related to merchandise sales.

WNRL

The following table sets forth the summary operating results for WNRL. The
selected historical financial data for the 2013 period presented below
represents the financial results from the period beginning October16, 2013
through the year ended December31, 2013. WNRL commenced operations on
October16, 2013, therefore, there is no comparable activity in prior periods.

                                   Year Ended December31,
                                   2013
                                   (In thousands)
Revenues:                           
Affiliate                           $25,942
Third-party                         698
Total revenues                      26,640
Operating costs and expenses:       
Operating and maintenance expenses  13,940
General and administrative expenses 1,107
Depreciation and amortization       2,676
Total operating costs and expenses  17,723
Operating income                    $8,917

NTI

The following table sets forth the summary operating results for Northern Tier
Energy, LP ("NTI"). The selected historical financial data for the 2013 period
presented below represents the financial results from the period beginning
November 12, 2013 through the year ended December31, 2013. We acquired NTI on
November 12, 2013, therefore, there is no comparable activity in prior
periods.

                                                      Year Ended December31,
                                                      2013
                                                      (In thousands)
Net sales                                              $686,824
Operating costs and expenses:                          
Cost of products sold (exclusive of depreciation and   591,942
amortization)
Direct operating expenses (exclusive of depreciation   35,123
and amortization)
Selling, general and administrative expenses           11,651
Loss on disposal of assets,net                        10
Depreciation and amortization                          10,740
Total operating costs and expenses                     649,466
Operating income                                       $37,358

Reconciliation of Special Items

We present certain additional financial measures below that are non-GAAP
measures within the meaning of Regulation G under the Securities Exchange Act
of 1934.

We present these non-GAAP measures to provide investors with additional
information to analyze our performance from period to period. We believe it is
useful for investors to understand our financial performance excluding these
special items so that investors can see the operating trends underlying our
business. Investors should not consider these non-GAAP measures in isolation
from, or as a substitute for, the financial information that we report in
accordance with GAAP. These non-GAAP measures reflect subjective
determinations by management and may differ from similarly titled non-GAAP
measures presented by other companies.

                                       Three Months Ended Year Ended
                                       December31,       December31,
                                       2013      2012     2013      2012
                                       (In thousands, except per share data)
Reported diluted earnings per share     $(0.09)   $1.92    $2.79     $3.71
Earnings before income taxes            $10,220   $322,360 $453,479  $617,087
Loss (gain) on disposal of assets,net  2,035     —        (4,989)   —
Unrealized (gain) loss from commodity   100,611   (81,519) 16,898    229,672
hedging transactions
Loss on extinguishment of debt          1         —        46,773    7,654
Earnings before income taxes excluding  112,867   240,841  512,161   854,413
special items
Recomputed income taxes after special   (31,972)  (85,161) (174,919) (302,120)
items (1)
Net income excluding special items      80,895    155,680  337,242   552,293
Net income attributed to                23,560    —        23,560    —
non-controlling interest
Net income attributable to Western      $57,335   $155,680 $313,682  $552,293
after special items
Diluted earnings per share excluding    $0.60     $1.45    $3.15     $5.08
special items

(1)We recompute income taxes after deducting earnings attributed to
non-controlling interest.

CONTACT: Investor and Analyst Contact:
         Jeffrey S. Beyersdorfer
         (602) 286-1530
        
         Media Contact:
         Gary W. Hanson
         (602) 286-1777

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