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SAN ANTONIO -- For Tesoro Corp., the third quarter was the charm, as the company reported a record output of 559,000 barrels per day for the third quarter.
"Our employees and shareholders should be very proud of this accomplishment since it enabled us to take advantage of a strong margin environment," said Bruce A. Smith, chairman, president and CEO of Tesoro.
For third quarter 2005, the company reported net earnings of $226 million, or $3.20 per share, compared to net earnings of $65 million, or 93 cents per share, for the third quarter of 2004.
Results for the third quarter include an after-tax charge of $5.6 million, or 8 cents per share, for insurance premium surcharges primarily related to the impact of hurricanes Katrina and Rita.
Third quarter 2004 results included after-tax charges of $12 million, or 18 cents per share, for the prepayment of almost $400 million of debt. Excluding these special items, net income was $77 million, or $1.11 per share, in the third quarter of 2004. In addition, the 2004 quarter was significantly impacted by a scheduled turnaround at Golden Eagle, which reduced total system throughput to 535,000 barrels per day.
For the first nine months of 2005, the company reported net earnings of $438 million, or $6.23 per share, compared to net earnings of $328 million, or $4.79 per share, for the first nine months of 2004.
Results for the first nine months of 2005 include after-tax charges of $8 million, or 11 cents per share, for the prepayment of debt as well as expenses related to the termination and retirement of certain executive officers. This compares to after-tax charges of $14 million, or 20 cents per share, for debt prepayment and financing costs incurred in the first nine months of 2004. Excluding special items, net earnings for the first nine months of 2005 were $446 million, or $6.34 per share, compared to net earnings excluding special items of $342 million, or $4.99 per share, for the first nine months of 2004.
For the quarter, total operating income more than doubled to almost $400 million compared to approximately $160 million a year ago. Cash and cash equivalents at the end of third quarter 2005 were $657 million, and total debt to capitalization declined to 38 percent compared with 48 percent at year-end 2004.
"Our solid operating performance this year has put us on track to exceed $1 billion of operating income for 2005. We expect strong industry fundamentals to continue, so the near term outlook remains very promising," said Smith.
Tesoro Corp. is an independent refiner and marketer of petroleum products that operates six refineries in the western United States with a combined capacity of nearly 560,000 barrels per day. Tesoro's retail marketing system includes almost 500 branded retail stations, of which over 200 are company operated under the Tesoro and Mirastar brand.