Delek US Holdings, Inc. (DK) CEO Uzi Yemin on Q4 2020 Results - Earnings Call Transcript

Delek US Holdings, Inc. (NYSE:DK) Q4 2020 Earnings Conference Call February 24, 2021 9:30 AM ET

Company Participants

Blake Fernandez - Senior Vice President of Investor Relations and Market Intelligence

Reuven Spiegel - Executive Vice President and Chief Financial Officer

Uzi Yemin - Chairman, President and Chief Executive Officer

Louis LaBella - Executive Vice President and President of Refining

Conference Call Participants

Roger Read - Wells Fargo

Manav Gupta - Credit Suisse

Prashant Rao - Citigroup

Ryan Todd - Simmons Energy

Phil Gresh - JP Morgan

Matthew Blair - Tudor, Pickering, Holt

Neil Mehta - Goldman Sachs

Jason Gabelman - Cowen

Operator

Good morning, and welcome to the Delek's Fourth Quarter and Full Year 2020 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions]. After today's presentation there will be an opportunity to ask question. [Operator Instructions]. Please note this event is being recorded.

I would now like to turn the conference over to Blake Fernandez. Please go ahead.

Blake Fernandez

Good morning. I would like to thank everyone for joining us on today's conference call and webcast to discuss Delek US Holdings' fourth quarter 2020 financial results. Joining me on today's call is Uzi Yemin, our Chairman, President, and CEO; Reuven Spiegel. EVP and CFO, and Louis LaBella, EVP and President of Refining; as well as other members of our management team. The presentation materials used during today's call can be found on the Investor Relations section of the Delek US website.

As a reminder, this conference call may contain forward-looking statements as that term is defined under Federal Securities Laws. Please see slide 2 for the Safe Harbor statement. In addition to reporting financial results in accordance with generally accepted accounting principles or GAAP, we report certain non-GAAP financial results. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to the comparable GAAP results, which can be found in the press release, which is posted on the Investor Relations segment of the website.

Our prepared remarks are being made assuming that the earnings press release has been reviewed, and we are covering less segment and market information that is incorporated into the 4Q press release.

On today's call, Reuven will review financial performance. I will cover capitalization and guidance. Louis will cover operations and CapEx. And then Uzi will offer a few closing comments.

With that, I'll turn the call over to Reuven.

Reuven Spiegel

Thank you, Blake. On an adjusted basis for the fourth quarter of 2020, Delek US reported a net loss of $204 million, or negative $2.77 per share, compared to net income of $9 million or $0.11 per diluted share in the prior year period. Our adjusted EBITDA was negative $138 million in the fourth quarter of 2020, compared to $65 million in the prior year period.

The second paragraph of the press release highlights $38 million of after tax headwinds, or $.52 per share of items included in adjusted results. I would like to highlight the tables on page 10 of the release providing inventory hedging impact, and page 14 providing other inventory impacts in the quarter.

On slide four, we provide a cash flow waterfall. In the fourth quarter of 2020, we had a positive cash flow of approximately $117 million from continuing operations, which includes a working capital benefit of $243 million. Cash capital expenditure in the quarter were approximately $32 million.

With that, I will turn it over to Blake.

Blake Fernandez

Thanks, Reuven. Slide five highlights our capitalization. We ended the fourth quarter with $788 million of cash on a consolidated basis and $1.56 billion of net long term debt, excluding net debt of Delek Logistics of $988 million, we had net long term debt of approximately $573 million at December 31, 2020.

I would remind you that we expect a federal tax refund of approximately $156 million, of which $136 million is expected to be collected in the first half of 2021. Moving to slide six, we provide our first quarter guidance for modeling.

Our controllable cost reduction initiatives remain on track on an underlying basis. That said inclement weather and our regional footprint in February is putting upward pressure on energy related expenses on a short term basis. We would expect weather-related expenses to normalize in due course. Lastly, the Wink to Webster JV announced in January that the Midland to Webster segment of the pipeline is now operating.

With that, I will turn the call over to Louis to discuss operations and CapEx.

Louis LaBella

Thanks, Blake. During the fourth quarter, our total refining system crude oil throughput was approximately 229,000 barrels per day. In the first quarter of 2021. We expect crude oil throughputs to average between 165,000 to 175,000 barrels per day, or approximately 56% utilization at the midpoint.

This reflects an accelerated timing of the El Dorado turnaround originally planned for 2Q, weather-related downtown's at Big Spring and Tyler, and in February -- and Krotz Springs continue to run at its current operating mode. Big Springs and Tyler are expected to be back to normal operations in March. And we have no further turnaround work planned for the rest of the year.

On slide seven, capital expenditures during the fourth quarter were $32 million, bringing full year 2020 spending to $240 million. This was $10 million below our revised capital budget and $85 million below our original 2020 budget. As a reminder, our 2021 capital program is expected to be $150 million to $160 million including turnarounds, representing a reduction of approximately $85 million from the 2020 levels.

Next, I turn the call to Uzi.

Uzi Yemin

Thank you, Louis. Good morning everybody. Delek remains on track and well-positioned entering 2021 supported by cost and capital reduction initiative. Recent industry downtime resulting from cold weather along the Gulf Coast should create improving product inventories and margins for the Gulf Coast region.

Our 80% ownership in DKL continues to perform well, with the company outlining another 5% distribution increase in 2021. In renewable diesel, we have retained a low cost option of $13 million to acquire their one-third economic interest in GCE Holdings acquisition, which indirectly owns and operates the Bakersfield California refinery.

In our view, this approach to renewable diesel helps mitigate execution risk and is far less capital intensive. The retail business has served as a layer of stability and diversification throughout the year. We see strong growth opportunities in this segment and with returns well above other areas within energy.

With that, I'll turn the call over to Blake.

Blake Fernandez

Thanks. Before we conclude, we would like to address CVR's energies nomination of three director candidates for election to the board at our 2021 annual meeting. Delek is committed to maintaining a strong, independent and diverse board that serves the best interests of its shareholders, employees, customers and partners, and regularly reviews opportunities to create and deliver value.

Our nomination and Corporate Governance Committee will evaluate CVR's nominees and make a recommendation in due course. We will not be making further comments on the nominations of our shareholder conversations at this time. The purpose of today's call is to discuss fourth quarter and full year 2020 earnings results, and we ask that you keep your questions focused on these topics.

With that operator, can we please open the call for questions?

Question-and-Answer Session

Operator

We will now begin the question and answer session. [Operator Instructions] Our first question comes from Roger Read with Wells Fargo. Please go ahead.

Roger Read

Yes. Thank you. Good morning. How are you all?

Uzi Yemin

Hey, Roger. Good morning.

Roger Read

I guess if we could release the renewable diesel. We've all been kind of waiting to hear what the investment side for you would be. Any more you can offer us in terms of timing of the facility coming online? Any thoughts on given that it's going to use a different kind of feedstock than a lot of the other facilities. How that's going out in Bakersfield and maybe thoughts on margin potential?

Uzi Yemin

So, Roger, there's not a lot of updates besides which in the slides. It's supposed to come online, January 22. We have a 90-day option once it's up and running. So there's really no benefit to us to execute that prior to this facility being up and running, and basically mitigating the execution risk. You rightly point out, they are potentially growing some camelina seed, and that could mitigate some of the feedstock risk. As we understand it, that could have a very low CI score. And that could be very interesting. But we're going to really defer to GCE and they're just disclosure. So at this point, we're basically just awaiting the execution and let them build the facility, and 90-day free look, and as you see there, $13 million to participate. So not a lot of additional information aside from which in the slide.

Roger Read

Okay. Thanks. And as a follow up, I don't want to get into the issue with the activist side of things. But some of what they've talked about is some of what those of us on the sell side and I think the buy side of thought before, which is -- what is the value of some of the unit's Krotz Springs at the time you acquired Alon. Uzi, we were all wondering if the unit would stay up and running. Right now, it's obviously idle. Putting all the other stuff aside, what kind of environment do you think we would need to see for Krotz Springs to come back into operation? Or should we consider it as one of these candidates more for a terminal or a future expansion of renewable fuels?

Uzi Yemin

Roger, that's a great one. Let me take it in pieces. First of all, Krotz wasn't idle. We took the time and did three time turnaround. It is finishing as we speak. In today's environment, including RINs, Krotz Springs is actually in the positive territory. It's not making on paper. It's not making a lot of money. But in today's margin, it's a $3 million, $4 million, $5 million a month of margin. So let's just call it $3 million or $4 million. That's including the RINs. We did take the time and enhance another project that we will be able to disclose over the next month or two that will add profitability to Krotz Springs. So we were in the waiting mode. But if margins continue to be where they are, $15, $16, with RINs a $1. Then we may restart the refinery over the next two to three weeks.

Roger Read

All right. Thank you.

Operator

The next question is from Manav Gupta with Credit Suisse. Please go ahead.

Manav Gupta

Hey, Uzi. This is a little bit of follow-up on Roger. And I think -- I won't ask about specific asset. But those who know you, know you well enough that you operate assets for free cash. You don't operate assets for nameplate capacity or any other reason. So I'm just trying to understand, let's say three to six months down the line. And let's not get into specific refinery. But let's say, there is a refinery where you think it will struggle to make free cash, would there be any hesitation on your part to close the asset and move ahead with it?

Uzi Yemin

Well, we are to the -- Manav, we have to the ledger of the shareholders. Shareholders want us to make money, not to be big. And we are -- our commitment and we are committed to a free cash flow. And we are committed to operating profitable assets. You make decisions on assets, not in one month or two months or three months. You take it -- you take long term vision. But absolutely to answer your question, it's clear that if we can't make money in an asset that is for a period of time, then we shouldn't operate it. We look all the time on optionality and changing different things. By the end of the day, our commitment is to make money not to have more assets.

Manav Gupta

That is perfect. And Uzi. Just on Big Springs very quickly. It's a very good refinery. It's done very well for you in the past. In the quarter, it looked a little lighter side. I'm just trying to understand were there any one times? Because it's a very good asset. So for that asset to generate that kind of gross margin, something must have gone wrong. So if you could elaborate a little?

Uzi Yemin

Yes, absolutely. Two or three reasons, if you will, first of all Asphalt. In a rising market, Asphalt is lagging. And that's one thing. The second thing we had couple of hiccups in Big Spring. We still consider Big Spring one of the best refineries in the country. So it’s like this quarter it is, but I wouldn't read much into it. Actually, when we hear about different people, we get phone calls about that asset all the time. If we have any intent to do something with it? Certainly not. Especially in light of Permian coming back. So one or two quarters don't mean much. We had to freeze this quarter [ph] as well. But we will be back on March 1st. I think, Louis, with full slate. Big Spring is one of our best assets.

Manav Gupta

Thank you so much, Uzi, for taking my questions.

Operator

The next question is from Prashant Rao with Citigroup. Please go ahead.

Prashant Rao

Hi, Uzi and team. Thanks for taking my question. I just said one. I wanted to sort of ask about the balance sheet. The debt level is high. It is for a lot of refiners right now, given where we are in the cycle. But just wanted to get your thoughts on how you see deleveraging occurring? And if there's a target for year end? And do you think that it can be achieved through free cash flow and some of these revenue initiatives? Or are other methods or strategies needed? Thanks.

Uzi Yemin

Good morning. Thanks for taking the time, Prashant. So let's go one by one. As you know, we have $156 billion as we said, coming our way, hopefully over the next month, if not over the next three months. We're hoping to get this quarter. If not, this quarter, I mean, first quarter. If not, it will be in the second quarter. We didn't commit to first quarter. So $156 million, that's coming our way. That's on that side. Second, free cash flow. We said that, all we need is another year of $270 million, $280 million to be free cash flow. That's the second thing.

The third thing, we have -- DKL is doing very well. And I don't know what -- we just announced that we have another 5% increase in dividend with DKL. So that's an asset that is doing very, very well. We're not in the business of holding 80% in DKL. So that's another avenue of getting cash. So I wouldn't rule out one of these options. We feel very comfortable with our cash position you saw in the quarter. We didn't burn any cash. We actually build cash. We feel that the second quarter -- the first quarter and the second quarter will be similar to that. So just something -- the balance sheet is not something that we're concern much about it.

Prashant Rao

Okay. Thanks, Uzi. And just a quick follow-up for us, so that we know we're on the same page. When you're thinking about debt level on the balance sheet, are you targeting sort of internally as your target more debt-to-total cap metric? Or you're looking at it more on a net debt-to-EBITDA metric? What do you guys think is the right metric or primary metric that we should be watching that you are targeting in terms of LNG [ph]?

Uzi Yemin

That's a great question. And I'm going to be -- if we can get to -- DKL is right now 3.8 times debt-to-EBITDA. There's no net debt in DKL. If we continue to do what we're doing, that number will go down toward -- if you remember, we said all along three and a half is something that we're comfortable for DKL. If you eliminate DKL, we are at $650 million right of net debt. If we can get less than two times at the DKL level, outside DKL, that's an area that we're comfortable with.

Prashant Rao

That's super helpful. Thanks, Uzi. Appreciate the time.

Operator

The next question is from Ryan Todd with Simmons Energy. Please go ahead.

Ryan Todd

Yes. Thanks. Maybe a quick follow-up on the refining side. Can you talk a little bit about any comments on RIN costs either what was the RIN expense in the fourth quarter? How you thinking about RIN expense in the first quarter? And maybe, refresh our view around the likelihood of potential reintroduction of small refinery exemptions under the new administration?

Uzi Yemin

Well, I'll take the second one. Blake, I'm sure want to take the first one that will allow me to drink my tea here. So the second one, we are not counting on the Biden administration to handsomely give SREs [ph]. However, there is that Supreme Court ruling that is coming in I think a couple of months and that may change things. I'm going to remind everybody that even under the Obama administration, Krotz Springs and El Dorado refinery got the exemptions. So, we'll see what the court ruling is. And then if it's positive to refiners, I don't see any reason why these two refineries won't be eligible to that. However, if the court -- and our assumption is that the court won't rule for that. Now, we don't really know. But we can build our cash flow based on something that is not tangible.

Blake Fernandez

And Ryan, on the first question. So, we have historically not disclosed what our RIN exposure or expense is. I will tell you obviously Krotz with the FCC unit not running, that's a good chunk of our exposure right there. So that mitigates some of it. But historically, we have not disclosed it. I mean, at the end of the day, we do have some blending capability. But I want to be clear, we prefer not to have elevated RIN expenses. So we just kind of leave it there.

Ryan Todd

Maybe on a separate note. I mean, I guess, I appreciate that you can't say much about the about the Bakersfield plan. But outside of the Bakersfield investment, have you explored the potential to participate further in the RD business? Are there any of your facilities that you view is potentially conducive to conversion like Krotz Springs, or at this point is kind of the near term focus just the capital light plan there?

Uzi Yemin

Ryan, you're asking a great question. We want to do it step at a time. Are we looking at it? Absolutely. We are concerned about the feedstock cost. And we want to do it. We play through GCE in one-third of that. We feel comfortable with that position. We do look at other opportunities, maybe to convert the entire refinery, maybe to convert some of the refineries. Just remember that we have four small refineries, relatively small, so they're all attractive to some degree with that area. But we are not in the business of investing right now, $400, $500 million in something that may not happen profitability wise.

Ryan Todd

Okay. Thanks guys.

Operator

The next question is from Phil Gresh with JP Morgan. Please go ahead.

Phil Gresh

Yes. Hi, good morning. Thanks for taking the questions. First one just on the working capital trends, which looked positive in the fourth quarter. How much of that was just rising crude price effect and benefits that come from that versus maybe any inventory effects for Krotz Springs from running at a lower level? And just how would you expect working capital to progress from a cash perspective in 2021?

Uzi Yemin

Phil, first, shutting down the refinery hurts your working capital and it doesn't help. So shutting down Krotz didn't help us. It’s actually hurt. Because if you remember, you pay for crude, and I'm sure you do. 20 days after the end of the month if you collect the receivable five days. So shutting out a refinery not running full slate, hurts your working capital and it doesn't help. Rising crude prices, certainly helps. $60 now will help tremendously in the first quarter as well. And I don't have the breakdown between -- we don't have the breakdown between inventory and rising prices on the receivable side, or the -- I'm sorry, the payable side. I want to make sure that you understand though. We manage our cash on a daily basis, and pay attention to our cash. So, by the end of the day, that's the most important thing, and we'll run our business like that.

Phil Gresh

Okay, great. Thank you for the clarification. One other thing, Uzi, you talked about in the last call, you had thrown buy backs out there as a discussion point, if cracks got to a certain level. Though it does sound like obviously, that the balance sheet is a key priority as well. So just your latest thoughts on buybacks versus balance sheet?

Uzi Yemin

With the combination, obviously, feel -- we feel comfortable with the balance sheet, as I said, $156 million does coming our way pretty soon. And that puts us in a great position with the balance sheet again, especially in light of DKL performing so well and we'll see what we do with that thing. It's still -- so the balance sheet feels good. With don't want to do buyback out of leveraging. So we would like to see -- like we I said, two, three, four months of free cash flow now. In the past, we said that $9, $10 cracks are good. With RINs prices being $1. At that time, RINs were $0.20. Today RINs are a $1. Obviously that number is much higher. So I don't want to commit today to a number of crack, because I really don't know what the other things will do Midland differential or RIN. Once we see free cash flow, there's no reason to believe that we won't go and find the combination between buyback and de-leveraging.

Phil Gresh

Okay. Last question just on retail, you talked in your release about line of sight, the strong growth potential. So I thought I'd see if there's anything worth elaborating on there? Thank you.

Uzi Yemin

So, Phil, retail, we see very strong organic growth opportunity within the energy complex. That's probably one of the strongest rate of return opportunities that we see. And so basically, that's what we wanted to highlight. Obviously, it served as a avenue of stability this past year. And once we do get back to a growth mode, we do see the opportunity to redeploy capital into that business and we're basically above 20% rate of return on some of the investments that we're seeing. So retail is attractive and whether that sits with us or someone else? That remains to be seen.

Phil Gresh

Okay. Thanks.

Operator

The next question is from Matthew Blair with Tudor, Pickering, Holt. Please go ahead.

Matthew Blair

Hey, good morning everyone. Like to start on the refining side. It looks like Tyler's gross margins improved fairly substantially quarter-over-quarter, which is in contrast to most Mid-con segments that are falling margins. Is there anything you'd like to call out here?

Uzi Yemin

Well, we did a very well in Tyler vis-à-vis moving crude and capturing and capitalizing on opportunities in that market. We -- the Delek trading and supply performed very well in Tyler. So you probably saw the $7 and then jumped. I would say that this is maybe one or two times event. I wouldn't go and just say, this is going forward. Because at the same time, as you know, we didn't perform as well as El Dorado. And these two are offset each other from time to time. So Tyler did great. But let's take some time before we celebrate victory here.

Matthew Blair

Makes sense. And then, on the renewable diesel side, it doesn't look like there's any existing LCFS fuel pathways for camelina. So I guess one, is getting that pathway is there any risk to getting that pathway? Or do you view that as pre-standard? And then two, Blake, I think you mentioned, you're expecting a pretty low CI. Are we talking something in kind of like the 20 to 30 range? Or could it possibly be even lower than that?

Blake Fernandez

So, Matthew, we really want to kind of defer to our friends over at GCE, since we're not even technically in the partnership at this point. I have read, and I'm sure you've seen industry commentary out there talking about 25, 30 CI scores. But I mean, again, we're not even in that. So I don't want to comment for our friends. And at this point, we just view it as a very attractive option. And again, to the extent that they can grow their own feedstock, I think that mitigates a lot of the risk in the industry, which we are very concerned about in terms of feedstock risk. So at this point, we really kind of just need to leave it there.

Matthew Blair

Yes. That's a good point. Thanks for the responses.

Operator

The next question is from Neil Mehta with Goldman Sachs. Please go ahead.

Neil Mehta

Good morning, guys. First question is on Delek Logistics. As you said, your stocks done really well here. And we've seen some multiple expansion. So how do you think about the potential for monetization there, given your large ownership, which accretes to your some of the parts? And then, in general, as you think about potentially right sizing the size of your refining business, if you elect to do that. How do you think about the fact that DKL is very much tied in to the refining system, recognizing there's a lot of third party in there too?

Uzi Yemin

First, these are as usually very good questions. I think there are three or four of them, I'll try to address each one of them here. First of all, DKL performed very well and rightfully so. We improve the leverage ratio. We improve the coverage ratio. The Big Spring gathering system, the trucking is performing very well for DKL. So -- and we do have other organic projects at DKL. And today we announced another 5% increase for next year. So we feel good about DKL. Still the yield is hovering between 8% and 9%. And we were very consistent with that thing.

We are not in the business of owning 80%. We said that all along. It depends on how we go about it, if we want to bite in or start monetizing some of it. That's something that we are looking at it very carefully. We couldn't do much during the blackout period. So that's something that we should continue to look at. We'll obviously look at the difference between DK and DKL and say to ourselves, okay, does it make sense to look at DKL and then by DK in lieu of DKL -- DK -- I mean buyback.

More and more DKL is a third party provider and not just tied to refineries. I think our Delek team are doing great job in going away from being dependent on the refineries. And it shows itself in the multiple that more and more is becoming a real MLP. So do I think that DKL is something that we look at -- that we need to look at? Absolutely. One last thing around the DKL in the refining asset. We just need to remember that as we get more and more third party, the percentage of refining assets in DKL goes down and its dependency on refining goes down. I hope I answered all your questions, Neil.

Neil Mehta

Yes. That's really good, Uzi. And the follow up is just on -- you have a large gathering system in the Permian. Are you seeing as Brent has now moved through 65 here. Return of production, particularly from privates. And just what is your view on activity levels as you talk to customers for Permian production? And then is that -- how do you think about that flowing into Midland differentials, which are trading at a premium to TI and part of that, I think is production level, but part of that is also the quality of that neat [ph] barrel, which is a better quality than even a Brent barrel. All these are great questions, Neil.

I think that it will take time for a production to catch up with the over build of the capacity. I think, as crazy as it sounds, the Biden administration may help the differentials, because they won't allow building infrastructure, while the Trump administration allowed wide open building assets. Though I think that the differentials will go back to minus $5 over the next year or two? We don't think so. And we don't build our budget on that, based on that. The level of activity is increasing. By the day you see it. And people -- more and more people will get comfortable. Remember, I don't think that Permian producers have seen $60 for a long, long, long, long time. Because when it was $60, WTI last time, the differentials were like $5 or $7 or $8.

So, I think a lot of people are rushing to do it. I think the demand if vaccine will materialize, as we see in Israel, for example, where there's a 95% reduction in the severe cases, then demand will come back second part of 2021 and 2022. And if this is the case, then the outlook will be nice. So the government put a note together thinking that Brent would grow even higher from here, I think 75. And if that's the case, then production or level of activity will go up. I don't count. We do not count on further discount at this point.

Neil Mehta

Thanks, Uzi. Appreciate it.

Operator

The next question is from Doug Leggate with Bank of America. Please go ahead.

Unidentified Analyst

Yes. Good morning. This is Clay on for Doug. Just a couple of questions for me. So I know you guys have pulled forward the El Dorado turnaround. Want to know what the scope of that turnaround is? Whether the scope of that work is final? Or whether it could be augmented by perhaps the recommendation of the board?

Louis LaBella

So, hey, this is Louis. Yes, the scope of the turnaround for El Dorado is maintenance, general maintenance, open cleaning and inspect. The scope is pretty much fixed. And due to the weather we had, the team was ready and to execute and we pulled it forward, so we can try to get it in and get ready for the rise in demand. And Clay, I think that just so, the timing of that is expected to be back online basically beginning of April. So we should have a full 2Q effect.

Unidentified Analyst

My second question is also on renewable diesel. With the execution of the renewable diesel auction [ph] obligate you to the liabilities of the operators, such any debt there occurring?

Louis LaBella

Clay, that's something we probably ought to take offline. So maybe we can huddle up on that offline if that's all right.

Unidentified Analyst

Sure. Thanks, guys.

Operator

The next question is from Jason Gabelman with Cowen. Please go ahead.

Jason Gabelman

Yes. Hey, thanks for taking my question. Maybe I'll try a couple on this Global Clean Energy project. Understanding that you can only talk so much about it. I was wondering if Global Clean Energy has actually broken ground yet on the project. And if the facility is going to include a pretreatment unit? And then my follow-up is on refining. I was just wondering, El Dorado looks like it ran at least in 4Q at a decently high rate and the whole system is running at a decently high rate, but margins remain pretty weak. So it just -- I don't know. It looks like maybe the optimal operating paradigm is to run at lower rates. Can you just discuss the decision particularly at El Dorado to run at relatively high levels despite negative margins? Thanks.

Louis LaBella

So, Jason, on the renewable piece, we're really going to have to defer to our folks over there at GCE. And so, at this point, it's not 100% clear what the pretreatment situation is. So, again, I'm sorry to not give you an awful lot of information, but we're basically on the sidelines on that. So sorry.

Uzi Yemin

And regard to El Dorado, as I said, if you look at Tyler, Tyler is very, very strong. You probably want to think about offsetting factors here, between Tyle and El Dorado. We do believe that in today's market, today's environment, El Dorado is certainly in the green in all areas. When I say green, I mean RIN [ph], EBITDA and RIN net income. So we'll see once we come up how it plays, but I wouldn't read much into one quarter. If you look at Tyler, Tyler is $7 and El Dorado is minus $4. So they offset each other.

Jason Gabelman

Got it. Thanks.

Operator

This concludes our question and answer session. I would like to turn the conference back over to Uzi Yemin for any closing remarks.

Uzi Yemin

Well, I'd like to thank everybody for their interest in our company. 2020 was a tough, tough, tough, tough year. And 2021, at least the second part of 2021 looks a little bear, or bear. I'd like to thank my colleagues around the table here. I'd like to thank investors for their confidence in us. We don't take it lightly. I'd like to thank the Board of Directors for their vote of confidence. But mainly I'd like to thank our employees for making this company what it is. Have a great day. Thank you.

Operator

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.