PBF Energy -5% on Q2 earnings shortfall, margin destruction

PBF Energy (PBF -5%) plunges after Q2 earnings fell 52% Y/Y and came in far short of Wall Street estimates, because of narrower North American crude discounts to global crudes, as well as higher feedstock prices.

PBF says it discharged ~116K bbl/day of rail-delivered crudes through its East Coast system, of which 41K were heavy crude oil; economics for North American barrels sourced by rail vs. waterborne barrels impacted deliveries, as well as scheduling of deliveries to the light crude unloading rack at its Delaware refinery.

During this morning's earnings call, CEO Tom Nimbley said the company may build its own rail offloading facility in Ohio; it recently finished expanding a rail offloading infrastructure in Delaware, which now has capacity to offload up to 210K bbl/day.

Cowen analysts maintain an Outperform rating on the shares, noting that the current asset base could see better results in H2 and the company should be an active presence in the asset market (Briefing.com).

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