VALERO ENERGY CORP/TX Q1 FY2026 earnings call

Lane mentioned Valero had an excellent first quarter, optimizing refining system and responding well to market disruption. Strategic progress on FCC unit optimization project at St. Charles refinery, expected to start in third quarter 2026. Homer discussed financial results, including net income, segment performances, capital investments, shareholder returns, and balance sheet details.

Refining segment: Operating income was $1.8 billion for the first quarter of 2026 compared to an operating loss of $530 million for the first quarter of 2025. Refining throughput volumes averaged 2.9 million barrels per day in the first quarter of 2026, and refining cash operating expenses were $5.13 per barrel. Renewable diesel segment: Operating income was $139 million for the first quarter of 2026 compared to an operating loss of $141 million for the first quarter of 2025. Renewable diesel segment sales volumes averaged 3 million gallons per day in the first quarter of 2026. Ethanol segment: Operating income was $90 million for the first quarter of 2026 compared to $20 million for the first quarter of 2025. Ethanol production volumes averaged 4.6 million gallons per day in the first quarter of 2026.

Port Arthur refinery incident expected to result in additional 2026 capital expenditures covered by insurance. Update on 2026 capital investment guidance pending definitive cost estimate and repair timeline. Second quarter refining throughput volumes ranges, renewable diesel sales volumes and operating expenses, ethanol production and operating expenses, net interest expense, and depreciation expense details provided.

Port Arthur refinery fire and resulting repair and operational impact risks. Market volatility and associated commodity risk management risks.

Q: Good morning, guys. Very strong quarter considering everything else that we are seeing out there. I just quickly wanted to pivot to the global refining macro, and I'm trying to understand, as these prices are rising, Gary, if you or somebody could comment as to what you're seeing for demand out there. Are you seeing any early signs of demand destruction in your system?

A: Yeah, Manav, this is Gary. You know, despite the fact, as you alluded to, that Prices for transportation fuels are moving higher. It appears that especially domestic demand appears to be very resilient...

Q: Yeah, thanks so much, team. And again, really solid results. Not to focus too much on quarter-to-quarter stuff, but, you know, when you think about the second quarter indicators, they're already showing $30 on the Gulf Coast versus Q1 levels, which were $18. And, you know, it really harkens back to the second quarter of 2022. And at that point, your share count was kind of closer to $400 million. Today it's closer to $300 million. So maybe that's a question for Homer. But as we start thinking about modeling out Q2 here, you know, any pluses and minuses that we should sort of be thinking about and anchoring to, and anything about March profitability that can give us a sense of what Q2 could shape up like.

A: Yeah, and, you know, I think, you know, if you look to the second quarter, definitely some headwinds and tailwinds. Certainly the steep backwardation in the crude market is a headwind...