Why were Rockies capture rates softer in Q4, particularly Montana, and how is Q1 shaping up?

Montana's 72% capture was due to coker downtime, which led to a lighter crude slate and incremental asphalt sales, impacting margins by about $10 million. Wyoming's normalized 70% capture was affected by a regional power outage and maintenance, reducing diesel sales by $4 million and increasing costs by $3 million. Q1 combined refining index is improving, with prompt distillate margins strengthening in the Rockies and Pacific Northwest. “In Montana, we had 72% capture relative to our sort of annual guidance of 90% to 100%. And I think it's really driven by the coker downtime. We lightened up our crude slate while the coker was offline, and it also results in incremental asphalt sales. And we estimate about a $10 million margin impact.”

What specific external growth opportunities is the company considering, including retail integration, refinery acquisitions, or corporate acquisitions?

The company focuses on accretive and synergistic opportunities that leverage its existing portfolio. While M&A has been a growth driver historically, discipline is key to avoid destroying shareholder value. In retail, small acquisitions (1-5 stores) and new builds are competitive, but larger-scale M&A is challenging due to competitors' cost of capital. They are open to refinery or corporate acquisitions if they fit the criteria. “I think we are focused on growing the scale of the business when it's accretive. And again, I think we're trying to find opportunities that are synergistic with our existing portfolio where we can really generate an edge.”

Are there updates on monetizing the excess land in Hawaii or the Laramie E&P investment?

Hawaii land redevelopment is progressing, nearing completion of equipment to grade, but it's a long-term project (several years) for rehabilitation. Laramie E&P continues to perform well and generate cash, improving its balance sheet. As a 46% owner, Par Pacific has influence but not control. The goal is to align with other shareholders to maximize value for the noncore gas business when they are ready to monetize, rather than selling a minority noncontrolling position. “So on the land position in Hawaii, we're continuing to progress the redevelopment of that. And again, I think, are nearing completing, getting the equipment to grade, and are again, working through the process to rehabilitate that and get it back into, I'll say, into commerce.”

PARR

Par Pacific (PARR) Q4 FY25 earnings call: guidance and Q&A

Earnings call· Dec 2025 (Q4 FY25)· Energy· Feb 25, 2026

Source: earnings call transcript

Executive summary

Par Pacific Q4 FY25 — Strong Operational Execution and Balance Sheet Strengthening

Par Pacific delivered a strong Q4 and full year 2025, marked by record refining throughput and segment profits across Logistics and Retail, alongside significant balance sheet strengthening. The company successfully navigated operational challenges, including a Wyoming heater event and a Montana turnaround, while advancing its Hawaii Renewables unit into commissioning. Management emphasizes a disciplined capital allocation strategy, balancing internal growth, opportunistic share repurchases, and potential synergistic external opportunities to expand mid-cycle earnings and free cash flow per share.

Highlights

Full year adjusted EBITDA was $634 million, reflecting meaningful progress.
Achieved record annual refining throughput of 188,000 barrels per day.
Logistics generated record segment profits and $126 million adjusted EBITDA for the full year.
Retail achieved record $86 million adjusted EBITDA for the full year, up from $76 million in 2024.
Total liquidity reached a record $915 million at year-end, improving by 49%.

Concerns

Wyoming crude heater event challenged operations early in the year, though recovery was ahead of schedule.
Hawaii Renewables unit commissioning timing extended modestly beyond original expectations.
Q4 Montana capture was 72%, impacted by coker downtime and asphalt sales, below the 90%-100% annual guidance.
Q4 Wyoming capture was 70% (normalized), impacted by a regional power outage and maintenance activities.
Larger-scale retail M&A is less likely and more challenging given competitors' cost of capital.

Guidance & targets

Category	Target	Timeline	Confidence
Q1 FY26 Hawaii throughput	85,000 to 89,000 barrels per day medium materiality	Q1 · FY26	High
Q1 FY26 Washington throughput	24,000 to 28,000 barrels per day medium materiality	Q1 · FY26	High
Q1 FY26 Wyoming throughput	13,000 to 16,000 barrels per day medium materiality	Q1 · FY26	High
Q1 FY26 Montana throughput	52,000 to 56,000 barrels per day medium materiality	Q1 · FY26	High
Q1 FY26 System-wide throughput	182,000 barrels per day high materiality	Q1 · FY26	High
Q1 FY26 Hawaii crude differential	$4.75 and $5.25 per barrel medium materiality	Q1 · FY26	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Refining Refining segment adjusted EBITDA was $88 million in Q4, down from $135 million in Q3. System-wide capture was 93% for the quarter and 94% for the full year. Hawaii showed strong throughput and high capture. Rockies operations (Wyoming, Montana) were impacted by specific events leading to softer capture rates. Combined Refining index: $13.13 per barrelSystem-wide Refining capture: 93%Hawaii throughput: 87,000 barrels per dayHawaii production costs: $4.15 per barrelHawaii Singapore 3-1-2: $21.43 per barrelHawaii landed crude differential: $6.05 per barrelHawaii capture: 104% (110% excluding hedging)Washington throughput: 37,000 barrels per dayWashington production costs: $4.57 per barrelWashington index: $8.60 per barrelWashington capture: 97%Wyoming throughput: 14,000 barrels per dayWyoming production costs: $13.27 per barrelWyoming index: $18.31 per barrelWyoming normalized capture: 70%Montana throughput: 52,000 barrels per dayMontana production costs: $11.74 per barrelMontana index: $11.14 per barrelMontana capture: 72%	—	—	—	$88 million adjusted EBITDA
Logistics Logistics segment adjusted EBITDA was $30 million in Q4, compared to $37 million in Q3. The segment achieved a record $126 million in adjusted EBITDA for the full year, driven by strong system utilization and cost reductions. Full year adjusted EBITDA: $126 millionAnnual cost reduction: $6 million	—	—	—	$30 million adjusted EBITDA
Retail Retail delivered $22 million of adjusted EBITDA in Q4, in line with Q3. For the full year, Retail achieved a record $86 million in adjusted EBITDA, up from $76 million in 2024, driven by favorable fuel and inside store margins and cost reductions. Full year adjusted EBITDA: $86 millionFull year adjusted EBITDA (2024): $76 millionSame-store fuel sales growth: 1.6%Same-store in-store sales growth: 1.5%Operating cost reduction: $4 million	—	—	—	$22 million adjusted EBITDA

PARR operating KPIs by quarter

PARR operating KPIs stated on its earnings calls, by fiscal quarter
KPI	This call Dec 2025 Q4 FY25	Mar 2026 Q1 FY26	Jun 2026 Q2 FY26	Change vs prior quarter
Refinery throughput Hawaii	87K bbl/d In Hawaii, throughput was strong at 87,000 barrels per day. Source: earnings call transcript	90K bbl/d In Hawaii, throughput was a record 90,000 barrels per day and production costs were $4.67 per barrel. Source: earnings call transcript	73.2K bbl/d In Hawaii, the Q2 throughput was 73,200 barrels per day and production costs were $6.43 per barrel. Source: earnings call transcript	-18.7%
Refinery throughput Washington	37K bbl/d Washington throughput was 37,000 barrels per day, reflecting reduced rates ahead of the first quarter planned downtime and production costs were $4.57 per barrel. Source: earnings call transcript	23K bbl/d The first quarter Washington throughput was 23,000 barrels per day and production costs were $7.53 per barrel, driven by reduced rates related to the February planned downtime. Source: earnings call transcript	41.2K bbl/d As I stated, Washington throughput set a new quarterly record at 41,200 barrels per day and production costs were $4.21 per barrel, capturing market missions following the Q1 planned outage. Source: earnings call transcript	+79.1%
Refinery throughput Wyoming	14K bbl/d Shifting to Wyoming, throughput was 14,000 barrels per day, and production costs were elevated at $13.27 per barrel due to a third-party power outage in Northern Wyoming and lower seasonal throughput. Source: earnings call transcript	15K bbl/d Shifting to Wyoming, throughput was 15,000 barrels per day and production costs were $11.68 per barrel, reflecting lower seasonal throughput. Source: earnings call transcript	14K bbl/d Throughput was 14,000 barrels per day and production costs were $15.28 per barrel, reflecting the April outage downtime and costs. Source: earnings call transcript	-6.7%
Refinery throughput Montana	52K bbl/d Finally, in Montana, fourth quarter throughput was 52,000 barrels per day, and production costs were $11.74 per barrel, elevated by approximately $1.50 per barrel due to coker maintenance. Source: earnings call transcript	57K bbl/d Finally, in Montana, first quarter throughput was 57,000 barrels per day and production costs were $9.05 per barrel. Source: earnings call transcript	53K bbl/d Finally, in Montana, second quarter throughput was 53,000 barrels per day and production costs were $10.16 per barrel. Source: earnings call transcript	-7%

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Deals & partnerships

world-class partners Joint venture for Hawaii Renewables unit

Formed a joint venture for the Hawaii Renewables unit at an attractive valuation, contributing to balance sheet strengthening.

Capital programs

Montana Turnaround completed

Executed the largest-ever turnaround in Montana safely and effectively, leading to record quarterly throughput of 58,000 barrels per day post-event.

Wyoming Crude Heater Event Recovery completed

Start: Q1 FY25

Restored Wyoming to reliable operations more than 1 month ahead of schedule following a Q1 crude heater incident.

Hawaii Renewables Unit commissioning

Advanced the Hawaii Renewables project into commissioning and early start-up phases during Q4 FY25. Pretreatment unit achieved on-specification feedstock. Final phases of operational readiness are underway, with post-treated feedstocks expected in the next few weeks. Timing extended modestly but no material operational issues.

Risks & headwinds

Volatile refining backdrop Q4 FY25

Combined Refining index averaged $13.13 per barrel in Q4, down approximately $1.60 from the prior quarter.

Mitigation:Structurally improving position within the cycle by increasing distillate yield, enhancing logistics integration, improving capture rates, and lowering cost structure.

Wyoming crude heater event Q1 FY25 (event), Q4 FY25 (residual impact)

Impacted operations early in FY25; Q4 Wyoming production costs elevated at $13.27 per barrel due to lower seasonal throughput and power outage.

Mitigation:Team delivered an exceptional recovery, restoring operations more than 1 month ahead of schedule. Focus on operational reliability and safety.

Hawaii Renewables unit commissioning timing extension Q4 FY25 into Q1 FY26

Timing extended modestly beyond original expectations.

Mitigation:Focus remains on safe start-up, operational stability, and optimization towards steady-state performance. No material operational issues reported.

Soft Rockies capture rates Q4 FY25

Montana capture 72% (impacted by $10 million margin reduction); Wyoming normalized capture 70% (impacted by $4 million diesel sales loss and $3 million maintenance cost increase).

Mitigation:Montana impact due to coker downtime and crude slate changes. Wyoming impact due to regional power outage and maintenance. Q1 outlook shows strengthening distillate margins.

Challenges in larger-scale retail M&A Ongoing

Larger-scale M&A in retail is less likely and more challenging.

Mitigation:Focus on small acquisitions (1-5 stores) and new builds where the company can be competitive and generate real returns, given competitors' cost of capital.

What to watch in Q1 FY26

Hawaii Renewables unit optimization

next few weeks / Q1 FY26

Current In final phases of operational readiness, pretreatment unit on-spec feedstock achieved.

Target Introduction of post-treated feedstocks and optimization towards steady-state performance.

Why it matters

Successful start-up and optimization of the renewables unit is key to future earnings power and energy transition positioning.

We are in the final phases of operational readiness and expect to introduce post-treated feedstocks into the renewables unit in the next few weeks. While timing has extended modestly beyond original expectations, there have been no material operational issues. Our focus remains on safe start-up, operational stability and optimization towards steady-state performance.

Find out whether PARR delivers this. Inve re-checks your case every morning.

Q&A highlights

How will cash from RIN monetization be used, and what is the approach to share repurchases given current stock levels?

Management's capital allocation framework remains consistent, focusing on a mix of share repurchases, internal growth opportunities, and potentially external opportunities. They will continue a dynamic approach given strong excess capital and flexibility, noting their track record of using all these avenues to generate shareholder returns.

“I think, our capital allocation framework remains consistent with how we've approached it in the past. I think we are looking at a mix of both the opportunity to repurchase our shares as well as internal growth opportunities and even potentially external opportunities.”

asked by Alexa Petrick · answered by William Monteleone

2 min read 6 chapters

Detailed narrative

2025 Performance Overview and Strategic Achievements

Par Pacific reported full year 2025 adjusted EBITDA of $634 million and adjusted net income of $7.56 per share, highlighting a year of significant progress. The company achieved record annual refining throughput of 188,000 barrels per day and successfully executed a major turnaround in Montana.

The Wyoming crude heater event was recovered ahead of schedule, and the Hawaii Renewables project advanced into commissioning, forming a joint venture with world-class partners.

Hawaii Renewables Unit Commissioning Update

The Hawaii Renewables unit progressed into commissioning and early start-up phases during Q4 FY25. The pretreatment unit successfully achieved on-specification feedstock with a range of inputs. The company is in the final phases of operational readiness and expects to introduce post-treated feedstocks into the renewables unit in the next few weeks.

While timing extended modestly, no material operational issues were reported, with focus on safe start-up and optimization.

Balance Sheet Strengthening and Capital Allocation

A significant highlight for 2025 was the strengthening of the balance sheet. The company ended the year with a record $915 million in liquidity, a 49% improvement, and reduced its share count by 10% to 49.7 million shares outstanding. Gross debt was reduced by $310 million, and an existing term loan was repriced, lowering annual cash interest by over $3 million.

This financial strength provides flexibility for growth investments, high-return internal projects, and opportunistic share repurchases.

Refining Capture Rates and Q4 Performance

System-wide refining capture was 93% for Q4 and 94% for the full year. However, Q4 Rockies capture was softer, with Montana at 72% and Wyoming at 70% (normalized). Montana's capture was impacted by coker downtime and increased asphalt sales, reducing margins by approximately $10 million.

Wyoming's capture was affected by a regional power outage and maintenance activities, leading to a $4 million impact from lower diesel sales and $3 million in increased operating costs.

External Growth and M&A Philosophy

Par Pacific is open to external growth opportunities that are accretive and synergistic with its existing portfolio. The company's approach is disciplined, aiming to grow scale without destroying shareholder value. In retail, small acquisitions (1-5 stores) and new builds are competitive, but larger-scale retail M&A is less likely due to competitors' cost of capital.

The company continues to progress redevelopment of Hawaii land and seeks to maximize value for its 46% stake in Laramie E&P, which is considered noncore.

WCS Differential Sensitivity and Outlook

The company's sensitivity to the WCS differential is approximately $15 million to $16 million per year for every $1 change, based on running 40,000 to 50,000 barrels per day of WCS. Par Pacific is an indirect beneficiary of increased Venezuelan crude barrels on the Gulf Coast, as this pushes Canadian barrels back into the Mid-Continent, leading to less volume flowing out of Vancouver and West Ridge.

This trend is favorable for crude differentials, moving them back towards a mid-cycle range of $15 to $16 under WTI.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.