PAR PACIFIC HOLDINGS INC
For the period ended Jun 30, 2024. Filed Aug 8, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 8, 2024
PARR$68.06-0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-08.
0000821483-24-000015
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-08.
0000821483-24-000022
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 125 previous paragraphs and 157 current paragraphs.
67 unchanged; 55 reworded; 27 added; 3 removed; 0 previous and 8 current paragraphs rearranged.
Tables are not compared: 26 previous and 36 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (27)
Current report
Adjusted EBITDA and Adjusted Net Income. For the six months ended June 30, 2024, Adjusted EBITDA was $176.3 million compared to $318.5 million for the six months ended June 30, 2023. The $142.2 million decrease was primarily related to a $112.3 million increase in operating expenses and a decrease of $33.5 million in our refining segment Adjusted Gross Margin. Please read the discussion of Adjusted Gross Margin by Segment and the Discussion of Consolidated Results below for additional information.
Current report
For the six months ended June 30, 2024, Adjusted Net Income was $70.2 million compared to $242.5 million for the six months ended June 30, 2023. The decline was primarily related to the same factors described above for the decrease in Adjusted EBITDA, an increase of $12.2 million of D&A, a decrease of $9.2 million of cash distributions received from Laramie Energy, LLC, and an increase of $7.5 million of interest expense and financing costs, excluding unrealized interest rate derivative losses (gains) .
Current report
(1)NM - Not meaningful
Current report
(1)Feedstocks throughput and sales volumes per day for the Montana refinery for the three and six months ended June 30, 2023 are calculated based on the 30-day period for which we owned the Montana refinery during the three and six months ended June 30, 2023. As such, the amounts for the total refining segment represent the sum of the Hawaii, Washington, and Wyoming refineries’ throughput or sales volumes averaged over the three and six months ended June 30, 2023, plus the Montana refinery’s throughput or sales volumes averaged over the period from June 1, 2023, to June 30, 2023. The 2024 amounts for the total refining segment represent the sum of the Hawaii, Montana, Washington, and Wyoming refineries’ throughput or sales volumes averaged over the three and six months ended June 30, 2024.
Current report
Refining. Operating income for our refining segment was $41.2 million for the three months ended June 30, 2024, a decrease of $2.9 million compared to operating income of $44.1 million for the three months ended June 30, 2023. The decrease was primarily driven by lower crack spreads across all the refineries in our legacy portfolio and higher feedstock costs, partially offset by an $11.2 million increase related to a full quarter contribution from the Billings Acquisition and an $8.1 million decrease in environmental costs incurred by our legacy refinery portfolio. Please read the Adjusted Gross Margin discussion below for additional information.
Current report
Logistics. Operating income for our logistics segment was $18.0 million for the three months ended June 30, 2024, a decrease of $2.7 million compared to $20.7 million for the three months ended June 30, 2023. The decrease was primarily due to a decrease of $3.7 million in third-party contracts and vessel revenue, partially offset by a decrease in vessel and fuel costs of $1.3 million.
Current report
Retail. Operating income for our retail segment was $27.0 million for the six months ended June 30, 2024, a decrease of $1.6 million compared to $28.7 million for the six months ended June 30, 2023. The decrease in operating income was primarily due to higher operating expenses of $3.8 million driven by an increase in employee costs, partially offset by increased merchandise sales of $1.8 million, and a $0.5 million increase related to 6% higher fuel sales volumes in the six months ended June 30, 2024 compared to the six months ended June 30, 2023.
Current report
•Adjusted Gross Margin for the Washington refinery decreased by $1.70 per barrel from $6.37 per barrel during the three months ended June 30, 2023 to $4.67 per barrel during the three months ended June 30, 2024. The decrease was primarily due to declining crack spreads, and a 10% decrease in refined product sales, partially offset by lower feedstock costs and favorable environmental costs. The RVO Adjusted Pacific Northwest 3-1-1-1 index declined from $25.13 in the second quarter of 2023 to $22.54 in the second quarter of 2024.
Current report
Refining. For the six months ended June 30, 2024, our refining Adjusted Gross Margin was $383.7 million, a decrease of $33.5 million compared to $417.2 million for the six months ended June 30, 2023. The decrease was primarily driven by a $157.3 million decline due to lower crack spreads, and a $27.0 million decrease related to a 5% decline in refined product sales volumes primarily from our Hawaii and Washington refineries, partially offset by increased Adjusted Gross Margin contributed by the Montana refinery of $66.6 million, $44.0 million lower purchased product expenses, $22.1 million benefit due to favorable derivative activities, and $12.7 million lower environmental expenses. Other factors impacting refining results are described below.
Current report
•Adjusted Gross Margin for the Hawaii refinery declined by $3.39 per barrel from $15.41 per barrel during the six months ended June 30, 2023 to $12.02 per barrel during the six months ended June 30, 2024, inclusive of 10 days of reduced production for required maintenance in March 2024. The decrease was primarily due to lower crack spreads, and a 4.4% decrease in sales volumes, partially offset by $44.0 million decrease of purchased product costs. The Singapore 3-2-1 index declined from $17.45 in the six months ended June 30, 2023 to $15.58 in the six months ended June 30, 2024.
Current report
•Adjusted Gross Margin for the Wyoming refinery decreased by $9.22 from $24.05 per barrel during the six months ended June 30, 2023 to $14.83 per barrel during the six months ended June 30, 2024, primarily due to lower regional crack spreads and higher environmental expenses, partially offset by a 7% increase in refined product sales volumes, a favorable FIFO impact of $9.0 million, and an $8.0 million decline in feedstock costs. The RVO Adjusted USGC 3-2-1 index declined from $24.09 in the six months ended June 30, 2023 to $19.63 in the six months ended June 30, 2024.
Current report
Logistics. For the six months ended June 30, 2024, our logistics Adjusted Gross Margin was $62.7 million, an increase of $12.1 million compared to $50.6 million for the six months ended June 30, 2023. The increase was primarily due to a $14.2 million increased contribution from the Billings Acquisition logistics assets acquired in June 2023 partially offset by an increase in cost of sales driven by $1.3 million of higher fees and variable expenses.
Current report
Retail. For the six months ended June 30, 2024, our retail Adjusted Gross Margin was $78.7 million, an increase of $2.1 million compared to $76.6 million for the six months ended June 30, 2023. The increase was primarily due to a 2% increase in merchandise sales. Other factors impacting results include a 6% increase in fuel sales volumes and a 34% decrease in fuel margins.
Current report
Cost of Revenues (Excluding Depreciation). For the three months ended June 30, 2024, cost of revenues (excluding depreciation) was $1.8 billion, an increase of $0.2 billion when compared to $1.6 billion for the three months ended June 30, 2023. The increase was primarily driven by a $0.3 billion increased contribution from the Billings Acquisition due to a full quarter under our ownership and higher crude oil prices, partially offset by decreases due to lower refining sales volumes, as discussed above, and lower environmental expenses.
Current report
Depreciation and Amortization. For the three months ended June 30, 2024, D&A was $32.1 million, an increase of $3.9 million compared to $28.2 million for the three months ended June 30, 2023. The increase was primarily driven by the $5.0 million of D&A attributable to the Billings Acquisition, partially offset by a $0.9 million decrease in D&A from our Hawaii Refinery primarily driven by assets that became fully depreciated in the second half of 2023, partially offset by cogeneration equipment in Hawaii and other assets placed into service during the period.
Current report
Debt Extinguishment and Commitment Costs. During the three months ended June 30, 2024, we incurred $1.4 million of debt extinguishment and commitment costs related to the repricing of our Term Loan Credit Agreement, the termination of our LC Facility and the expiration of our Supply and Offtake Agreement in the second quarter of 2024. For the three months ended June 30, 2023, we incurred an immaterial amount of debt extinguishment and commitment costs. Please read Note 9—Inventory Financing Agreements, and Note 11—Debt for further information.
Current report
Equity earnings (losses) from Laramie Energy, LLC. For the three months ended June 30, 2024, Equity losses from Laramie Energy, LLC were $1.4 million. For the three months ended June 30, 2024, our proportionate share of Laramie Energy’s net loss was $3.0 million, partially offset by $1.6 million of basis difference accretion. There were no equity earnings from our investment in Laramie Energy, LLC, for the three months ended June 30, 2023. Please read Note 4—Investment in Laramie Energy for further discussion.
Current report
Income Taxes. For the three months ended June 30, 2024, income tax expense was $6.7 million, an increase of $4.7 million compared to $1.9 million for three months ended June 30, 2023, primarily related to higher apportionment factors in the states in which we pay taxes. For three months ended June 30, 2023, we recorded an income tax expense of $1.9 million primarily related to recording a valuation allowance on our deferred taxes. Please read Note 18—Income Taxes for further discussion.
Current report
Revenues. For the six months ended June 30, 2024, revenues were $4.0 billion, a $0.5 billion increase compared to $3.5 billion for the six months ended June 30, 2023. The increase was primarily due to an increase of $0.8 billion in the contribution from the Billings Acquisition, which closed on June 1, 2023. When comparing our legacy refining operations, there were decreases of $0.2 billion in third-party revenues at our refining segment, $0.2 billion related to lower average crack spreads and $0.1 billion related to a 5% decrease in sales volumes primarily from our Hawaii and Washington refineries, partially offset by a $0.1 billion increase due to higher crude oil prices. The RVO Adjusted USGC 3-2-1, RVO Adjusted Pacific Northwest 3-1-1-1, and 3-1-2 Singapore Crack Spread declined 19%, 15%, and 11%, respectively, compared to 2023. Average WTI crude oil prices increased 5% and average Brent crude oil prices increased 4% as compared to the prior period. Revenues at our retail segment increased $9.0 million primarily due to a 6% increase in fuel sales volumes and a $1.2 million increase in merchandise revenue, partially offset by a 3% decrease in fuel prices.
Current report
Operating Expense (Excluding Depreciation). For the six months ended June 30, 2024, operating expense (excluding depreciation) was $297.3 million, an increase of $112.3 million compared to $185.0 million for the six months ended June 30, 2023. The increase was primarily driven by a $101.8 million increase in the contribution from the Billings Acquisition, coupled with $6.4 million of higher employee costs and a $4.8 million increase in outside services costs, partially offset by $1.9 million of lower utility and maintenance expenses.
Current report
Equity earnings from refining and logistics investments. For the six months ended June 30, 2024, equity earnings from refining and logistics investments were $9.8 million, an increase of $9.4 million compared to $0.4 million for the six months ended June 30, 2023. For the six months ended June 30, 2024, our proportionate share of YELP’s net income and YPLC’s net income was $6.8 million and $3.7 million, respectively. Our proportionate share of YPLC’s net income was $0.4 million for the six months ended June 30, 2023. There were no equity earnings from YELP for the six months ended June 30, 2023. Please read Note 3—Refining and Logistics Equity Investments for additional information.
Current report
Par West redevelopment and other costs. For the six months ended June 30, 2024, Par West redevelopment and other costs were $5.0 million, a decrease of $0.4 million compared to $5.4 million for the six months ended June 30, 2023, associated with the operation and decommissioning of our Par West facility. The decrease was primarily due to a decrease in redevelopment activities.
Current report
Interest Expense and Financing Costs, Net. For the six months ended June 30, 2024, our interest expense and financing costs were $38.3 million, an increase of $7.1 million compared to $31.2 million for the six months ended June 30, 2023. The increase was primarily due to an $8.7 million increase in debt costs, mainly driven by higher interest expenses due to higher ABL Credit Facility balances in 2024 to fund certain inventory purchases at our Hawaii refinery and Washington refinery, and a $5.1 million decrease in interest income from our investment accounts opened in the first quarter of 2023, offset by a $6.7 million decrease in inventory financing costs, due to the termination of the Washington Refinery Intermediation Agreement in the fourth quarter of 2023, and termination of our Supply and Offtake Agreement in the second quarter of 2024. Please read Note 9—Inventory Financing Agreements, and Note 11—Debt for further information.
Current report
Other income (expense), net. For the six months ended June 30, 2024, other expense was $2.7 million, a decrease of $3.0 million compared to $0.3 million of other income for the six months ended June 30, 2023. The decrease was primarily due to $2.3 million of 2024 legal expenses unrelated to operating activities with no similar 2023 expenses.
Current report
Equity Earnings from Laramie Energy, LLC. For the six months ended June 30, 2024, Equity earnings from Laramie Energy, LLC were $3.2 million, a decrease of $7.5 million compared to $10.7 million for the six months ended June 30, 2023. For the six months ended June 30, 2024, the accretion of basis difference was $3.2 million, partially offset by our proportionate share of Laramie Energy’s net loss which was immaterial. On April 29, 2024, Laramie Energy made a one-time cash distribution to its owners, including us, based on ownership percentage. Our share of this distribution was $1.5 million. On March 1, 2023, following a refinancing of certain debt, Laramie Energy was permitted to make a one-time cash distribution to its owners based on ownership percentage. Our share of this distribution was $10.7 million. There were no equity earnings from our investment in Laramie Energy, LLC for the six months ended June 30, 2023. Please read Note 4—Investment in Laramie Energy for further discussion.
Current report
Income Taxes. For the six months ended June 30, 2024, income tax expense was $4.0 million, an increase of $1.9 million compared to $2.1 million for the six months ended June 30, 2023, primarily related to higher apportionment factors in the states in which we pay taxes. For the six months ended June 30, 2023, we recorded an income tax expense of $2.1 million primarily related to recording a valuation allowance on our deferred taxes. Please read Note 18—Income Taxes for further discussion.
Current report
(2) The acquisition and integration expense related to the Billings Acquisition was pushed down from the Parent Guarantor to the Issuer and Subsidiaries upon consummation of the transaction.
Removed paragraphs (3)
Previous report
(1) NM - Not meaningful
Previous report
Income Taxes. For the three months ended March 31, 2024, we recorded income tax benefit of $2.6 million primarily related our first quarter of 2024 pre-tax net loss. For the three months ended March 31, 2023, we recorded income tax expense of $0.2 million primarily related to increased taxable income.
Previous report
Net cash used in investing activities for the three months ended March 31, 2023 consisted primarily of $13.2 million in additions to property, plant, and equipment driven by maintenance projects at our refineries and various profit improvement projects, including improved crude processing equipment at our Hawaii refinery. This was partially offset by a $10.7 million cash distribution received from Laramie Energy, LLC.
Reworded paragraphs (55)
Previous wording
Crude oil pricing was relatively stable in the first quarter of 2024 compared to the first quarter of 2023. Brent crude oil pricing averaged $81.76 per barrel in the first quarter of 2024 compared to $82.10 per barrel in the first quarter of 2023. Similarly, average U.S. retail gasoline prices remained relatively stable from $3.38 per gallon in the first quarter of 2023 to $3.24 in the first quarter of 2024. Refined product crack spreads in the first quarter of 2024 decreased as compared to the first quarter of 2023. The U.S. Energy Information Administration (“EIA”) in its April 2024 short term energy outlook forecasts average Brent crude oil pricing of $89 per barrel in 2024 due to strong global inventory draws in the first quarter of 2024 and ongoing geopolitical risks. In 2023, OPEC announced several voluntary production cuts. Russia announced on February 10, 2023, that it would cut its oil production by 500,000 barrels a day (5 percent of its output), as a response to imposed sanctions on the country’s oil trade. In June 2023, OPEC extended oil output cuts of 3.66 million barrels per day, or about 5% of daily global demand, until the end of 2024, including a Russian cut in oil exports of 300,000 barrels a day until the end of 2023. In November 2023 OPEC announced additional voluntary production cuts of 1.7 million barrels a day, thus totaling about 2.2 million barrels a day, from January through March 2024. On March 3, 2024, OPEC announced an extension of its November 2023 voluntary production cut through June 2024, driving down supply, as demand increases due to spring and summer travel seasons in the Northern Hemisphere. Additionally, geopolitical tensions in the Middle East escalated in the first quarter of 2024 putting upward pressure on prices. The overall effect of these conflicts and associated actions taken to limit the purchase of Russian petroleum products has been to raise the operating costs of many European and other refineries. Energy prices are, among other factors, indicators of inflation. The overall energy price index increased 2.1% year over year as of March 31, 2024. While inflation has worsened relative to the prior year, we do not believe that inflation has had a material effect on our business, financial condition or results of operations in the first quarter of 2024. Please read Item 1A. — Risk Factors on our Annual Report on Form 10-K for the year ended December 31, 2023 for further information.
Current wording
Crude oil pricing increased in the first half of 2024 compared to the first half of 2023. Brent crude oil pricing averaged $85.03 per barrel in the first half of 2024 compared to $77.73 per barrel in the first half of 2023. Average U.S. retail gasoline prices remained relatively stable from $3.59 per gallon in the first half of 2023 to $3.52 per gallon in the first half of 2024. Refined product crack spreads in the first half of 2024 decreased as compared to the first half of 2023. The U.S. Energy Information Administration (“EIA”) in its June 2024 short term energy outlook forecasts average Brent crude oil pricing of $85 per barrel in the second half of 2024 due to strong global inventory draws in the first half of 2024 driven by less Organization of the Petroleum Exporting Countries (“OPEC”) production. In 2023, OPEC announced several voluntary production cuts. Russia announced on February 10, 2023, that it would cut its oil production by 500,000 barrels a day (5% of its output), as a response to imposed sanctions on the country’s oil trade. In June 2023, OPEC extended oil output cuts of 3.66 million barrels a day, or about 5% of daily global demand, until the end of 2024, including a Russian cut in oil exports of 300,000 barrels a day until the end of 2023. In November 2023 OPEC announced additional voluntary production cuts of 1.7 million barrels a day, thus totaling about 2.2 million barrels a day, from January through March 2024. On March 3, 2024, OPEC announced an extension of its November 2023 voluntary production cut through June 2024, driving down supply, as demand increases due to spring and summer travel seasons in the Northern Hemisphere. On June 2, 2024, OPEC agreed to extend the latest cut of 2.2 million barrels a day until the end of September and gradually phase it out from October on a monthly basis. Additionally, geopolitical tensions in the Middle East and the Red Sea region continued to escalate in the first half of 2024 putting upward pressure on prices. The overall effect of these conflicts and associated actions taken to limit the purchase of Russian petroleum products impacted freight movements and raised the operating costs of many European and other refineries. Energy prices are, among other factors, indicators of inflation. The overall energy price index increased 4.3% year over year as of June 30, 2024. While inflation has worsened relative to the prior year, we do not believe that inflation has had a material effect on our business, financial condition, or results of operations in the first half of 2024. Please read Item 1A. — Risk Factors on our Annual Report on Form 10-K for the year ended December 31, 2023 for further information.
Previous wording
Net Income (Loss). Our financial results for the first quarter of 2024 declined from net income of $237.9 million for the three months ended March 31, 2023 to a net loss of $3.8 million for the three months ended March 31, 2024. The decrease was primarily driven by a $240.5 million decrease in refining segment operating income, including a $94.7 million decrease driven by a gain on RINs settlements in the first quarter of 2023, a $22.5 million increase in general and administrative expenses, a $6.1 million decrease in equity earnings from our investment in Laramie, and a $2.5 million decrease in retail segment operating income, partially offset by a $17.7 million loss on termination of financing agreements in 2023 with no similar activity in 2024, a $7.8 million improvement in our logistics segment operating income, a $5.1 million decrease in acquisition and integration expenses related to our Billings Acquisition, and a $2.8 million decrease in income tax expense. Please read the discussions of segment and consolidated results below for additional information.
Current wording
Net Income. Our financial results for the second quarter of 2024 declined from net income of $30.0 million for the three months ended June 30, 2023 to $18.6 million for the three months ended June 30, 2024. The decrease was primarily driven by a $5.5 million increase in interest expense and financing costs, net, a $4.7 million increase in income tax expense, a $2.9 million decrease in our refining segment operating income, a $2.7 million decrease in our logistics segment operating income, a $1.5 million increase in debt extinguishment and commitment costs, and a $1.4 million decrease in equity earnings from Laramie Energy, LLC, partially offset by a $7.4 million decrease in acquisition and integration expenses related to our Billings Acquisition. Please read the discussions of segment and consolidated results below for additional information.
Previous wording
Adjusted EBITDA and Adjusted Net Income. For the three months ended March 31, 2024, Adjusted EBITDA was $94.7 million compared to $167.6 million for the three months ended March 31, 2023. The $72.9 million decrease was primarily related to a decrease of $71.4 million in our refining segment, a decrease of $9.5 million in our corporate and other segment, and a decrease of $2.5 million in our retail segment, partially offset by an increase of $10.5 million in our logistics segment. Please read the discussion of segment results below for additional information.
Current wording
Adjusted EBITDA and Adjusted Net Income. For the three months ended June 30, 2024, Adjusted EBITDA was $81.6 million compared to $150.8 million for the three months ended June 30, 2023. The $69.2 million decrease was primarily related to a $42.3 million increase in operating expenses and a decrease of $29.0 million in refining segment Adjusted Gross Margin. Please read the discussion of Adjusted Gross Margin by Segment and the Discussion of Consolidated Results below for additional information.
Previous wording
For the three months ended March 31, 2024, Adjusted Net Income was $41.7 million compared to $137.5 million for the three months ended March 31, 2023. The decline was primarily related to the factors described above for the decrease in Adjusted EBITDA, an increase of $8.3 million in D&A and an increase of $2.5 million in interest expense and financing costs, excluding unrealized interest rate derivative losses (gains), partially offset by a $2.6 million income tax benefit in 2024 compared to $0.2 million income tax expense in 2023.
Current wording
For the three months ended June 30, 2024, Adjusted Net Income was $28.5 million compared to $105.0 million for the three months ended June 30, 2023. The decline was primarily related to the factors described above for the decrease in Adjusted EBITDA, an increase of $5.0 million in interest expense and financing costs, excluding unrealized interest rate derivative losses (gains), and an increase of $3.9 million of D&A, partially offset by a cash distribution of $1.5 million received from Laramie Energy, LLC in the second quarter of 2024.
Previous wording
The following tables summarize our consolidated results of operations for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 (in thousands). The following should be read in conjunction with our condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q.
Current wording
The following tables summarize our consolidated results of operations for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023 (in thousands). The following should be read in conjunction with our condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q.
Previous wording
The following tables summarize our operating income (loss) by segment for the three months ended March 31, 2024 and 2023 (in thousands). The following should be read in conjunction with our condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q.
Current wording
The following tables summarize our operating income (loss) by segment for the three and six months ended June 30, 2024 and 2023 (in thousands). The following should be read in conjunction with our condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q.
Previous wording
(2)Includes eliminations of intersegment Revenues and Cost of revenues (excluding depreciation) of $157.8 million and $118.2 million for the three months ended March 31, 2024 and 2023, respectively.
Current wording
(2)Includes eliminations of intersegment Revenues and Cost of revenues (excluding depreciation) of $165.1 million and $137.7 million for the three months ended June 30, 2024 and 2023, respectively.
Previous wording
Below is a summary of key operating statistics for the refining segment for the three months ended March 31, 2024 and 2023:
Current wording
Below is a summary of key operating statistics for the refining segment for the three and six months ended June 30, 2024 and 2023:
Previous wording
(1)We calculate Adjusted Gross Margin per barrel by dividing Adjusted Gross Margin by total refining throughput. Adjusted Gross Margin for our Washington refinery is determined under the last-in, first-out (“LIFO”) inventory costing method. Adjusted Gross Margin for our other refineries is determined under the first-in, first-out (“FIFO”) inventory costing method.
Current wording
(2)We calculate Adjusted Gross Margin per barrel by dividing Adjusted Gross Margin by total refining throughput. Adjusted Gross Margin for our Washington refinery is determined under the last-in, first-out (“LIFO”) inventory costing method. Adjusted Gross Margin for our other refineries is determined under the first-in, first-out (“FIFO”) inventory costing method.
Previous wording
(2)Management uses production costs per barrel to evaluate performance and compare efficiency to other companies in the industry. There are a variety of ways to calculate production costs per barrel; different companies within the industry calculate it in different ways. We calculate production costs per barrel by dividing all direct production costs, which include the costs to run the refineries including personnel costs, repair and maintenance costs, insurance, utilities, and other miscellaneous costs, by total refining throughput. Our production costs are included in Operating expense (excluding depreciation) on our consolidated statement of operations, which also includes costs related to our bulk marketing operations and severance costs.
Current wording
(3)Management uses production costs per barrel to evaluate performance and compare efficiency to other companies in the industry. There are a variety of ways to calculate production costs per barrel; different companies within the industry calculate it in different ways. We calculate production costs per barrel by dividing all direct production costs, which include the costs to run the refineries including personnel costs, repair and maintenance costs, insurance, utilities, and other miscellaneous costs, by total refining throughput. Our production costs are included in Operating expense (excluding depreciation) on our condensed consolidated statements of operations, which also includes costs related to our bulk marketing operations and severance costs.
Previous wording
(3)We believe the 3-1-2 Singapore Crack Spread (or three barrels of Brent crude oil converted into one barrel of gasoline and two barrels of distillates (diesel and jet fuel)) is the most representative market indicator for our operations in Hawaii.
Current wording
(4)We believe the 3-1-2 Singapore Crack Spread (or three barrels of Brent crude oil converted into one barrel of gasoline and two barrels of distillates (diesel and jet fuel)) is the most representative market indicator for our operations in Hawaii.
Previous wording
(4)We believe the RVO Adjusted Pacific Northwest 3-1-1-1 (or three barrels of WTI crude oil converted into one barrel of Pacific Northwest gasoline, one barrel of Pacific Northwest ULSD and one barrel of USGC VGO, less 100% of the RVO cost for gasoline and ULSD) is the most representative market indicator for our operations in Washington with improved historical correlations to our reported adjusted gross margin compared to prior reported indices.
Current wording
(5)We believe the RVO Adjusted Pacific Northwest 3-1-1-1 (or three barrels of WTI crude oil converted into one barrel of Pacific Northwest gasoline, one barrel of Pacific Northwest ULSD and one barrel of USGC VGO, less 100% of the RVO cost for gasoline and ULSD) is the most representative market indicator for our operations in Washington.
Previous wording
(5)We believe the RVO Adjusted USGC 3-2-1 (or three barrels of WTI crude oil converted into two barrels of USGC gasoline and one barrel of USGC ULSD, less 100% of the RVO cost) is the most representative market indicator for our operations in Montana and Wyoming with improved historical correlations to our reported adjusted gross margin compared to prior reported indices.
Current wording
(6)We believe the RVO Adjusted USGC 3-2-1 (or three barrels of WTI crude oil converted into two barrels of USGC gasoline and one barrel of USGC ULSD, less 100% of the RVO cost) is the most representative market indicator for our operations in Montana and Wyoming.
Previous wording
Below is a summary of key operating statistics for the retail segment for the three months ended March 31, 2024 and 2023:
Current wording
Below is a summary of key operating statistics for the retail segment for the three and six months ended June 30, 2024 and 2023:
Previous wording
(1)For the three months ended March 31, 2024 and 2023, there was no impairment expense and LIFO liquidation adjustment recorded in Operating income (loss). For the three months ended March 31, 2023, there was no (gain) loss on sale of assets recorded in Operating income (loss).
Current wording
(1)For the three and six months ended June 30, 2024 and 2023, there was no impairment expense or LIFO liquidation adjustment recorded in Operating income. For the three and six months ended June 30, 2023, there was no (gain) loss on sale of assets recorded in Operating income.
Previous wording
The following table presents a reconciliation of Adjusted Net Income and Adjusted EBITDA to the most directly comparable GAAP financial measure, Net income (loss), on a historical basis for the periods indicated (in thousands):
Current wording
The following table presents a reconciliation of Adjusted Net Income and Adjusted EBITDA to the most directly comparable GAAP financial measure, Net income, on a historical basis for the periods indicated (in thousands):
Previous wording
(1)For the three months ended March 31, 2024, we recognized a non-cash deferred tax benefit of $2.6 million related to deferred state and federal tax liabilities. This tax benefit is included in Income tax expense (benefit) on our consolidated statements of operations. For the three months ended March 31, 2023, we did not have any adjustments to our valuation allowance and other deferred tax items.
Current wording
(1)For the three and six months ended June 30, 2024, we recognized a non-cash deferred tax expense of $6.2 million and $3.5 million, respectively, related to deferred state and federal tax liabilities. This tax benefit is included in Income tax expense (benefit) on our consolidated statements of operations. For the three and six months ended June 30, 2023, we did not have any adjustments to our valuation allowance and other deferred tax items.
Previous wording
(2)For the three months ended March 31, 2024, we incurred $13.1 million of stock-based compensation expenses associated with accelerated vesting of equity awards and modification of vested equity awards related to our CEO transition and $2.3 million for an estimated legal settlement unrelated to current operating activities.
Current wording
(2)For the six months ended June 30, 2024, we incurred $13.1 million of stock-based compensation expenses associated with accelerated vesting of equity awards and modification of vested equity awards related to our CEO transition and $2.3 million for an estimated legal settlement unrelated to current operating activities.
Previous wording
(3)For the three months ended March 31, 2024 and 2023, there was no change in value of contingent consideration, change in value of common stock warrants, impairment expense, impairments associated with our investment in Laramie Energy, or our share of Laramie Energy’s asset impairment losses in excess of our basis difference. Please read the Non-GAAP Performance Measures discussion above for information regarding changes to the components of Adjusted Net Income (Loss) and Adjusted EBITDA made during the reporting periods.
Current wording
(3)For the three and six months ended June 30, 2024 and 2023, there was no change in value of contingent consideration, change in value of common stock warrants, impairment expense, impairments associated with our investment in Laramie Energy, or our share of Laramie Energy’s asset impairment losses in excess of our basis difference. Please read the Non-
Previous wording
Retail. Operating income for our retail segment was $11.0 million for the three months ended March 31, 2024, a decrease of $2.5 million compared to $13.5 million for the three months ended March 31, 2023. The decrease was primarily due to a $2.2 million increase in operating expenses driven by higher employee costs. Gross margin remained relatively consistent in the three months ended March 31, 2024, compared to the three months ended March 31, 2023.
Current wording
Retail. Operating income for our retail segment was $16.1 million for the three months ended June 30, 2024, an increase of $0.9 million compared to $15.2 million for the three months ended June 30, 2023. The increase was primarily due to a $1.2 million increase in fuel margins, and increased merchandise sales of $0.8 million, partially offset by a $1.6 million increase in operating expenses driven by higher employee costs.
Previous wording
Refining. Operating income for our refining segment was $22.6 million for the three months ended March 31, 2024, a decrease of $240.5 million compared to operating income of $263.1 million for the three months ended March 31, 2023. The decrease was primarily driven by:
Current wording
Refining. Operating income for our refining segment was $63.8 million for the six months ended June 30, 2024, a decrease of $243.5 million compared to $307.3 million for the six months ended June 30, 2023. The decrease in operating income was primarily driven by:
Previous wording
Logistics. Operating income for our logistics segment was $20.4 million for the three months ended March 31, 2024, an increase of $7.8 million compared to $12.6 million for the three months ended March 31, 2023. The increase was primarily due to a $7.7 million contribution from the Billings Acquisition logistics assets acquired in June 2023.
Current wording
Logistics. Operating income for our logistics segment was $38.4 million for the six months ended June 30, 2024, an increase of $5.1 million compared to $33.3 million for the six months ended June 30, 2023. The increase was primarily due to a $7.3 million increase in contribution from the Billings Acquisition logistics assets acquired in June 2023 partially offset by a $2.5 million decrease in third-party contracts for our logistics services. Our legacy logistics portfolio consists of our logistics assets, excluding logistics assets from the Billings Acquisition.
Previous wording
Refining. For the three months ended March 31, 2024, our refining Adjusted Gross Margin was $207.1 million, a decrease of $4.5 million compared to $211.6 million for the three months ended March 31, 2023. The decrease was primarily driven by a decrease of $131.8 million related to decreased crack spreads across our legacy refining portfolio, a decrease of $17.7 million related to lower refined product sales volumes across our legacy portfolio, a decrease of $17.3 million primarily related to higher feedstock costs across our legacy refining portfolio, and a decrease of $15.6 million related to higher inventory financing costs, partially offset by $66.8 million contributed by the Montana refinery acquired in June 2023, an improvement of $52.4 million related to lower purchased product costs across our legacy refining portfolio, favorable derivative changes of $25.8 million, and favorable FIFO adjustments of $21.0 million driven by a decrease in feedstock costs. Other factors impacting refining results are described below.
Current wording
Refining. For the three months ended June 30, 2024, our refining Adjusted Gross Margin was $176.6 million, a decrease of $29.0 million compared to $205.6 million for the three months ended June 30, 2023. The decrease was primarily driven by a decrease of $29.8 million related to decreased crack spreads across our legacy refining portfolio and a $9.7 million decline in refined product sales volumes primarily from our Hawaii and Washington refineries, partially offset by lower feedstock costs, and $4.7 million lower environmental expenses. Other factors impacting refining results are described below.
Previous wording
•Adjusted Gross Margin for the Hawaii refinery decreased by $5.11 per barrel from $19.11 per barrel during the three months ended March 31, 2023 to $14.00 per barrel during the three months ended March 31, 2024, including 10 days of reduced production for required maintenance in March 2024. The decrease in Adjusted Gross Margin was primarily due to declining crack spreads, partially offset by lower purchased product and feedstock costs. The Singapore 3-1-2 index declined from $21.22 in the first quarter of 2023 to $18.67 in the first quarter of 2024.
Current wording
•Adjusted Gross Margin for the Hawaii refinery decreased by $2.01 per barrel from $12.08 per barrel during the three months ended June 30, 2023 to $10.07 per barrel during the three months ended June 30, 2024. The decrease in Adjusted Gross Margin was primarily due to declining crack spreads and a 5.7% decrease in refined product sales, partially offset by lower feedstock costs. The Singapore 3-1-2 index declined from $13.72 in the second quarter of 2023 to $12.49 in the second quarter of 2024.
Previous wording
•Adjusted Gross Margin for the Wyoming refinery decreased by $12.70 per barrel from $27.54 per barrel during the three months ended March 31, 2023 to $14.84 per barrel during the three months ended March 31, 2024, primarily due to lower regional crack spreads, partially offset by lower feedstock costs and a favorable FIFO change of $5.0 million. The RVO Adjusted USGC 3-2-1 index decreased from $26.55 in the first quarter of 2023 to $21.34 in the first quarter of 2024.
Current wording
•Adjusted Gross Margin for the Wyoming refinery decreased by $5.82 per barrel from $20.56 per barrel during the three months ended June 30, 2023 to $14.74 per barrel during the three months ended June 30, 2024, primarily due to lower regional crack spreads, partially offset by a 19% increase in refined product sales, and lower feedstock costs. The RVO Adjusted USGC 3-2-1 index decreased from $21.65 in the second quarter of 2023 to $17.93 in the second quarter of 2024.
Previous wording
Logistics. For the three months ended March 31, 2024, our logistics Adjusted Gross Margin was $32.0 million, an increase of $10.9 million compared to $21.1 million for the three months ended March 31, 2023. The increase is primarily due to $10.9 million contributed by the Billings Acquisition logistics assets acquired in June 2023.
Current wording
Logistics. For the three months ended June 30, 2024, our logistics Adjusted Gross Margin was $30.8 million, an increase of $1.2 million compared to $29.6 million for the three months ended June 30, 2023. The increase is primarily due to a $4.0 million increase in contribution from the Billings Acquisition logistics assets acquired in June 2023, partially offset by a decrease of $1.8 million driven by a 3% reduction in Hawaii throughput.
Previous wording
Retail. For the three months ended March 31, 2024, our retail Adjusted Gross Margin was $37.1 million, a decrease of $0.2 million compared to $37.3 million for the three months ended March 31, 2023. The decrease was primarily due to a 12% decrease in fuel margins, partially offset by 9% higher fuel sales volumes and 11% higher merchandise sales margins in the three months ended March 31, 2024 compared to the comparable period in 2023.
Current wording
Retail. For the three months ended June 30, 2024, our retail Adjusted Gross Margin was $41.6 million, an increase of $2.4 million compared to $39.2 million for the three months ended June 30, 2023. The increase was primarily due to 9% higher merchandise sales margins and 4% higher fuel sales volumes in the three months ended June 30, 2024 compared to the comparable period in 2023.
Previous wording
•Adjusted Gross Margin for the Washington refinery decreased by $4.94 per barrel from $11.07 per barrel during the three months ended March 31, 2023 to $6.13 per barrel during the three months ended March 31, 2024, inclusive of a 15-day planned maintenance in March 2024. The decrease was primarily due to declining crack spreads, higher inventory financing expenses, and an 11% decrease in refined product sales, partially offset by a favorable change in derivative activities, favorable environmental costs, and lower purchased product costs. The RVO Adjusted Pacific Northwest 3-1-1-1 index declined from $25.30 in the first quarter of 2023 to $20.48 in the first quarter of 2024.
Current wording
•Adjusted Gross Margin for the Washington refinery decreased by $3.36 per barrel from $8.66 per barrel during the six months ended June 30, 2023 to $5.30 per barrel during the six months ended June 30, 2024, inclusive of a 15-day planned maintenance event in March 2024. The decrease was primarily due to declining crack spreads and an 11% decrease in refined product sales, partially offset by lower feedstock costs. The RVO Adjusted Pacific Northwest 3-1-1-1 index declined from $25.21 in the six months ended June 30, 2023 to $21.51 in the six months ended June 30, 2024.
Previous wording
Revenues. For the three months ended March 31, 2024, revenues were $2.0 billion, a $0.3 billion increase compared to $1.7 billion for the three months ended March 31, 2023. The increase was primarily due to a $0.5 billion contribution from the Billings Acquisition, partially offset by a 5% decrease in refining sales volumes across our legacy refinery portfolio during the quarter and a decrease in average product crack spreads discussed below. The 3-1-2 Singapore Crack Spread, RVO Adjusted Pacific Northwest 3-1-1-1, and RVO Adjusted USGC 3-2-1 declined 12%, 19%, and 20%, respectively, compared to the first quarter of 2023. Please read our key operating statistics for further information. Revenues at our retail segment increased $4.5 million primarily due to a 9% increase in volumes.
Current wording
Revenues. For the three months ended June 30, 2024, revenues were $2.0 billion, a $0.2 billion increase compared to $1.8 billion for the three months ended June 30, 2023. The increase was primarily due to a $0.3 billion increased contribution from the Billings Acquisition, which closed June 1, 2023, and $0.1 billion due to higher crude oil prices discussed below, partially offset by a 4% decrease in refining sales volumes primarily driven by our Hawaii and Washington refinery operations during the quarter and a decrease in average product crack spreads also discussed below. Average WTI crude oil prices increased 10% and average Brent crude oil prices increased 9% as compared to the prior period. The RVO Adjusted USGC 3-2-1, RVO Adjusted Pacific Northwest 3-1-1-1, and 3-1-2 Singapore Crack Spread declined 17%, 10%, and 9%, respectively, compared to the second quarter of 2023. Please read our key operating statistics for further information. Revenues at our retail segment increased $4.4 million primarily due to a 4% increase in fuel sales volumes.
Previous wording
Operating Expense (Excluding Depreciation). For the three months ended March 31, 2024, operating expense (excluding depreciation) was $153.3 million, a $70.2 million increase when compared to $83.1 million for the three months ended March 31, 2023. The increase was driven by a $60.7 million contribution from the Billings Acquisition, a $4.3 million increase in consulting services, and a $2.5 million increase in repairs and maintenance expenses.
Current wording
Operating Expense (Excluding Depreciation). For the three months ended June 30, 2024, operating expense (excluding depreciation) was $144.1 million, a $42.3 million increase when compared to $101.8 million for the three months ended June 30, 2023. The increase was driven by a $41.1 million increased contribution from the Billings Acquisition.
Previous wording
Equity earnings from refining and logistics investments. During the three months ended March 31, 2024, Equity earnings from refining and logistics investments were $6.1 million related to YELP and YPLC. For the three months ended March 31, 2024, our proportionate share of YELP’s net income and YPLC’s net income was $4.5 million and $1.9 million, respectively. Please read Note 3—Refining and Logistics Equity Investments for further information.
Current wording
Equity earnings from refining and logistics investments. During the three months ended June 30, 2024, Equity earnings from refining and logistics investments, related to YELP and YPLC, were $3.7 million, an increase of $3.3 million compared to $0.4 million for the three months ended June 30, 2023. For the three months ended June 30, 2024, our proportionate share of YELP’s net income and YPLC’s net income was $2.3 million and $1.8 million, respectively. During the three months ended June 30, 2023, Equity (earnings) from refining and logistics investments were $0.4 million related to YPLC. There were no equity earnings from YELP for the three months ended June 30, 2023. Please read Note 3—Refining and Logistics Equity Investments for further information.
Previous wording
Acquisition and Integration Expense. During the three months ended March 31, 2024, we incurred an immaterial amount of acquisition and integration costs. For the three months ended March 31, 2023, we incurred $5.3 million of acquisition and integration costs related to the Billings Acquisition. Please read Note 5—Acquisitions for further information.
Current wording
Acquisition and Integration Expense. During the three months ended June 30, 2024, we incurred an immaterial amount of acquisition and integration costs. For the three months ended June 30, 2023, we incurred $7.3 million of acquisition and integration costs related to the Billings Acquisition, which closed on June 1, 2023. Please read Note 5—Acquisitions for further information.
Previous wording
Par West redevelopment and other costs. For the three months ended March 31, 2024, Par West redevelopment and other costs were $2.0 million, a decrease of $0.8 million compared to $2.8 million for the three months ended March 31, 2023, primarily due to a decrease in redevelopment activities.
Current wording
Par West redevelopment and other costs. For the three months ended June 30, 2024, Par West redevelopment and other costs were $3.1 million, an increase of $0.5 million compared to $2.6 million for the three months ended June 30, 2023, primarily due to an increase in redevelopment activities.
Previous wording
Interest Expense and Financing Costs, Net. For the three months ended March 31, 2024, our interest expense and financing costs were $17.9 million, an increase of $1.6 million compared to $16.3 million for the three months ended March 31, 2023. The increase was primarily due to a $2.9 million increase in interest expense due to higher outstanding debt balances, partly offset by an increase of $1.2 million in interest income from our investment accounts opened in the first quarter of 2023. Please read Note 11—Debt to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for further information.
Current wording
Interest Expense and Financing Costs, Net. For the three months ended June 30, 2024, our interest expense and financing costs were $20.4 million, an increase of $5.5 million compared to $14.9 million for the three months ended June 30, 2023. The increase was primarily due to a $5.6 million increase in debt costs, mainly driven by higher interest expenses due to higher ABL Credit Facility balances in 2024 to fund certain inventory purchases at our Hawaii refinery and Washington refinery and a $4.0 million decrease in interest income from our investment accounts. The increase was partially offset by a $4.2 million decrease in inventory financing costs due to the termination of the Washington Refinery Intermediation Agreement in the fourth quarter of 2023, and termination of our Supply and Offtake Agreement in the second quarter of 2024. Please read Note 9—Inventory Financing Agreements and Note 11—Debt for further information.
Previous wording
Cost of Revenues (Excluding Depreciation). For the three months ended March 31, 2024, cost of revenues (excluding depreciation) was $1.7 billion, an increase of $0.4 billion when compared to $1.3 billion for the three months ended March 31, 2023. The increase was primarily driven by a $0.4 billion contribution from the Billings Acquisition.
Current wording
Cost of Revenues (Excluding Depreciation). For the six months ended June 30, 2024, cost of revenues (excluding depreciation) was $3.5 billion, a $0.7 billion increase compared to $2.9 billion for the six months ended June 30, 2023, primarily driven by a $0.7 billion contribution from the Billings Acquisition.
Previous wording
Depreciation and Amortization. For the three months ended March 31, 2024, D&A was $32.7 million, an increase of $8.3 million compared to $24.4 million for the three months ended March 31, 2023. The increase was primarily driven by the $8.5 million of D&A attributable to the Billings Acquisition.
Current wording
Depreciation and Amortization. For the six months ended June 30, 2024, D&A was $64.8 million, an increase of $12.2 million compared to $52.6 million for the six months ended June 30, 2023. The increase was primarily driven by $13.4 million of D&A attributable to the Billings Acquisition, partially offset by a $1.0 million decrease related to catalyst in Hawaii that was fully depreciated in 2023.
Previous wording
General and Administrative Expense (Excluding Depreciation). For the three months ended March 31, 2024, general and administrative expense (excluding depreciation) was $41.8 million, an increase of $22.5 million compared to $19.3 million for the three months ended March 31, 2023. The increase was primarily due to a $15.9 million increase in employee costs driven by $13.1 million of stock based compensation expenses related to CEO transition costs in the first quarter of 2024 and an increase of $2.6 million in payroll expenses due primarily to an increase in employee headcount, a $4.2 million increase in renewable development expense, and $1.6 million related to the Billings Acquisition.
Current wording
General and Administrative Expense (Excluding Depreciation). For the six months ended June 30, 2024, general and administrative expense (excluding depreciation) was $64.9 million, an increase of $22.4 million compared to $42.5 million for the six months ended June 30, 2023. The increase was primarily due to a $18.7 million increase in employee costs driven by $13.1 million of stock based compensation expenses related to CEO transition costs in the first quarter of 2024 and an increase of $5.8 million in payroll expenses due to an increase in employee headcount, a $3.1 million increase in IT expenses, and $2.5 million of expenses related to development of our renewable projects.
Previous wording
Debt Extinguishment and Commitment Costs. During the three months ended March 31, 2024, we incurred no debt extinguishment and commitment costs. For the three months ended March 31, 2023 we incurred $17.7 million of debt extinguishment and commitment costs in connection with the refinancing of our long-term debt in the first quarter of 2023. Please read Note 11—Debt to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for further information.
Current wording
Debt Extinguishment and Commitment Costs. During the six months ended June 30, 2024, we incurred $1.4 million of debt extinguishment and commitment costs primarily related to the repricing of our Term Loan Credit Agreement, the termination of our LC Facility and the expiration of our Supply and Offtake Agreement in the second quarter of 2024. For the six months ended June 30, 2023, we incurred debt extinguishment and commitment costs of $17.7 million in connection with the refinancing of our long-term debt in the first quarter of 2023. Please read Note 9—Inventory Financing Agreements, and Note 11—Debt for further information.
Previous wording
(1)The income tax benefit (expense) of the Parent Guarantor and Par Borrower and Subsidiaries is determined using the separate return method. The Non-Guarantor Subsidiaries and Eliminations column includes tax benefits recognized at the Par consolidated level that are primarily associated with changes to the consolidated valuation allowance and other deferred tax balances.
Current wording
(1) The income tax benefit (expense) of the Parent Guarantor and Issuer and Subsidiaries is determined using the separate return method. The Non-Guarantor Subsidiaries and Eliminations column includes tax benefits recognized at the Par consolidated level that are primarily associated with changes to the consolidated valuation allowance and other deferred tax balances.
Previous wording
The following tables present a reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure, Net income (loss), on a historical basis for the periods indicated (in thousands):
Current wording
The following tables present a reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure, Net income, on a historical basis for the periods indicated (in thousands):
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Rearranged current paragraphs (8)
Current report — wording carried from elsewhere
Net Income. Our financial results declined from net income of $267.9 million for the six months ended June 30, 2023 to $14.9 million for the six months ended June 30, 2024. The decrease was driven by a $243.5 million decrease in refining segment operating income, a $22.5 million increase in general and administrative expenses, and a $1.6 million decrease in retail segment operating income, partially offset by a $12.5 million decrease in acquisitions and integration expenses related to our Billings Acquisition and a $5.1 million increase in logistics segment operating income. Please read the discussions of segment and consolidated results below for additional information.
Current report — wording carried from elsewhere
(1)Our logistics operations consist primarily of intercompany transactions which eliminate on a consolidated basis.
Current report — wording carried from elsewhere
(2)Includes eliminations of intersegment Revenues and Cost of revenues (excluding depreciation) of $322.9 million and $255.9 million for the six months ended June 30, 2024 and 2023, respectively.
Current report — wording carried from elsewhere
GAAP Performance Measures discussion above for information regarding changes to the components of Adjusted Net Income (Loss) and Adjusted EBITDA made during the reporting periods.
Current report — wording carried from elsewhere
General and Administrative Expense (Excluding Depreciation). For the three months ended June 30, 2024, general and administrative expense (excluding depreciation) was $23.2 million, consistent with $23.2 million for the three months ended June 30, 2023.
Current report — wording carried from elsewhere
Acquisition and Integration Expense. During the six months ended June 30, 2024, we incurred an immaterial amount of acquisition and integration costs. For the six months ended June 30, 2023, we incurred $12.5 million of acquisition and integration costs related to the Billings Acquisition, which closed on June 1, 2023. Please read Note 5—Acquisitions for further information.
Current report — wording carried from elsewhere
Term Loan Credit Agreement may also require annual prepayments of principal with a variable percentage of our excess cash flow, 50% or 25% depending on our consolidated year end secured leverage ratio (as defined in the Term Loan Credit Agreement).
Current report — wording carried from elsewhere
Net cash used in investing activities for the six months ended June 30, 2023 consisted primarily of: