Company paid down debt, continued to pay dividends, sold a refinery and has been reducing costs. The company has $2 billion in cash and an additional $4 billion in liquidity and $8 billion in debt.
In the previous four quarters, VLO net income was -113 million, -1408 million, -629 million and -254 million. So, this is a welcome change to the positive territory. I suspect refinery companies in the US have turned the corner and should return to profitability on a sustainable basis. Continued improvement depends on improved demand for their products which depends a lot on the economy getting better. The company for its part is focused on cut savings and eking out better margins.
Read the call transcript here.
Related article: I posted an article on Valuing Cyclical stocks with an example of Valero Energy
Disclaimer: I have a long position in shares of Valero at the time of publishing this post. My position may change at any time without any further updates. Please conduct your own research before considering investments based on these or any ideas on this blog.