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New words:
ACF, ACL, adjudged, Alena, Alhambra, Alkylation, analyze, armed, Assignee, basket, bench, Benicia, bus, Canyon, cargo, Carquinez, CCC, CEC, CIO, clause, consortium, Contra, Costa, Crimson, CRSC, Cruz, DFG, displace, drayage, ECA, effluent, El, elevated, exit, exiting, Extraction, FAC, Flexi, Franklin, Game, green, hire, hub, Hydrotreating, indemnification, Isomerization, Joseph, Justice, knowledge, landscape, Lara, LEAP, lender, Marysville, matching, matrixed, Maumee, mile, Payne, penetration, permittable, phishing, Piscitelli, Polymerization, proceeding, recalculated, reclaim, Red, regular, repurposed, rescheduled, reside, Richmond, rulemaking, Russian, SBx, Shannon, Sobrante, Strait, suit, suitable, supervisory, suppressed, technical, UDEX, Vacuum, Warehouse, weekly, wholesale, Zanzucchi
Removed:
abandon, abandoned, accordion, accrue, accuracy, affirmative, alleviate, ASU, atypical, Bella, challenge, close, conference, confidential, consent, Conservation, consume, contemplation, CUSIP, DCTC, de, decision, decrement, defense, desire, draft, Erik, evaluation, exclusively, execution, Facilitation, feature, floating, functional, Gisela, goodwill, guidance, headcount, heard, history, idling, imbalance, initially, initiative, interbank, intercreditor, Janette, John, Joinder, La, LIBOR, lifted, London, mutually, notification, omitted, onset, optional, ordered, overhead, Palladium, pari, passu, PDVSA, perspective, propose, QAP, rationalize, reassessment, reconfigured, refinanced, reform, removal, replace, resolve, SCAQMD, seek, sourced, sparked, suspension, unprecedented, validity, Venezuela, Young
Financial report summary
?Risks
- Risks Relating to Our Business and Industry
- Demand for our refined products can significantly decline due to changes in global and regional economic conditions.
- The price volatility of crude oil, other feedstocks, blendstocks, refined products and fuel and utility services may have a material adverse effect on our revenues, profitability, cash flows and liquidity.
- Our working capital, cash flows and liquidity can be significantly impacted by volatility in commodity prices and refined product demand.
- Our profitability is affected by crude oil differentials and related factors, which fluctuate substantially.
- A significant interruption or casualty loss at any of our refineries and related assets could reduce our production, particularly if not fully covered by our insurance. Failure by one or more insurers to honor its coverage commitments for an insured event could materially and adversely affect our future cash flows, operating results and financial condition.
- Our refineries are subject to interruptions of supply and distribution, including due to severe weather events, as a result of our reliance on pipelines and railroads for transportation of crude oil and refined products.
- Our results of operations continue to be impacted by significant costs to comply with renewable fuels mandates. The market prices for RINs have been volatile and may harm our profitability.
- We may have capital needs for which our internally generated cash flows and other sources of liquidity may not be adequate.
- We may incur significant liability under, or costs and capital expenditures to comply with, regulatory, environmental and health and safety regulations, which are complex and change frequently.
- Potential further laws and regulations related to climate change could have a material adverse impact on our operations and adversely affect our facilities.
- Regulation of emissions of greenhouse gases could force us to incur increased capital expenditures and operating costs and could have a material adverse effect on our results of operations and financial condition.
- Environmental clean-up and remediation costs of our sites and environmental litigation, including related to climate change, could decrease our net cash flow, reduce our results of operations and impair our financial condition.
- Our pipelines are subject to federal and/or state regulations, which could reduce profitability and the amount of cash we generate.
- Recent record refining industry profits have raised the concern of public policy experts and federal and state policymakers, who have questioned whether these profits are justified, or whether they constituted a “windfall” to the industry and have enacted or could enact legislation that could adversely affect our operations and our profitability.
- We could incur substantial costs or disruptions in our business if we cannot obtain or maintain necessary permits and authorizations or otherwise comply with health, safety, environmental and other laws and regulations.
- Enhanced scrutiny on ESG matters and developments related to climate change may negatively impact our business and our access to capital markets.
- Some of our competitors may have a competitive advantage by providing alternative energy sources or by owning their own retail sites.
- We may be negatively affected by the rate of inflation and its impact on the global economy.
- We may not be able to obtain funding on acceptable terms or at all, including because of volatility and uncertainty in the credit and capital markets. This may hinder or prevent us from meeting our future capital needs.
- Any political instability, military strikes, sustained military campaigns, terrorist activity, changes in foreign policy, or other catastrophic events could have a material adverse effect on our business, results of operations and financial condition.
- A cyber-attack on, or other failure of, our technology infrastructure could affect our business and assets, and have a material adverse effect on our financial condition, results of operations and cash flows.
- Competition from companies that produce their own supply of feedstocks, have extensive retail outlets, make alternative fuels or have greater financial and other resources than we do could materially and adversely affect our business and results of operations.
- We must make substantial capital expenditures on our operating facilities to maintain their reliability and efficiency. If we are unable to complete capital projects at their expected costs and/or in a timely manner, or if the market conditions assumed in our project economics deteriorate, our financial condition, results of operations or cash flows could be materially and adversely affected.
- We are subject to strict laws and regulations regarding employee and process safety, and failure to comply with these laws and regulations could have a material adverse effect on our results of operations, financial condition and profitability.
- Product liability and operational liability claims and litigation could adversely affect our business and results of operations.
- Compliance with and changes in tax laws could adversely affect our performance.
- Acquisitions or other investments that we may undertake in the future involve a number of risks, any of which could cause us not to realize the anticipated benefits.
- A portion of our workforce is unionized, and we may face labor disruptions that would interfere with our operations.
- Our business may suffer if any of our senior executives or other key employees discontinues employment with us. Furthermore, a shortage of skilled labor or disruptions in our labor force may make it difficult for us to maintain labor productivity.
- Our hedging activities may limit our potential gains, exacerbate potential losses and involve other risks.
- Our commodity derivative activities could result in period-to-period earnings volatility.
- Our indebtedness could adversely affect our financial condition and prevent us from fulfilling our obligations under our indebtedness.
- We may not be able to secure necessary financing on acceptable terms, or at all.
- Despite our level of indebtedness, we and our subsidiaries may be able to incur substantially more debt, which could exacerbate the risks described above.
- Our future credit ratings could adversely affect our business, the cost of our borrowing, and our ability to obtain credit in the future.
- Restrictive covenants in our debt instruments, including the indentures governing our notes, may limit our ability to undertake certain types of transactions, which could adversely affect our business, financial condition, results of operations and our ability to service our indebtedness.
- Provisions in our indentures and other agreements could discourage an acquisition of us by a third-party.
- Risks Related to Our Organizational Structure
- Under a tax receivable agreement, PBF Energy is required to pay the pre-IPO owners of PBF LLC for certain realized or assumed tax benefits it may claim arising in connection with its initial public offering and future exchanges of PBF LLC Series A Units, or other permitted assignees, for shares of its Class A common stock and related transactions (the “Tax Receivable Agreement”). The indentures governing the senior notes allow us, under certain circumstances, to make distributions sufficient for PBF Energy to pay its obligations arising from the Tax Receivable Agreement.
- Risks Related to Our Affiliation with PBFX
- We depend upon PBFX for a substantial portion of our refineries’ logistics needs and have obligations for minimum volume commitments in our commercial agreements with PBFX.
Management Discussion
- (1)See Non-GAAP Financial Measures.
- The table below summarizes certain market indicators relating to our operating results as reported by Platts, a division of The McGraw-Hill Companies. Effective RIN basket price is recalculated based on information as reported by Argus.
- Overview— Our net income was $1,803.8 million for the year ended December 31, 2023 compared to net income of $3,708.9 million for the year ended December 31, 2022.