CVR 3Q earnings up eight-fold;?á nitrogen income more than triples

CVR Energy Inc. reported an eight-fold increase in net income, to $99.7 million ($1.16 per diluted share) for the third quarter ending Sept. 30, 2008, up from the year-ago $11.2 million ($.13 per share). Sales were up by almost $1 billion, to $1.58 billion from the year-ago $586 million.

“CVR Energy’s positive third quarter performance is directly related to higher operating levels at both our refinery and the nitrogen facility,” said Jack Lipinski, CVR chairman, president, and CEO. He said the nitrogen business took advantage of attractive prices for ammonia and UAN, while the refinery had reasonable profits despite highly volatile crude oil prices and fluctuating crack spreads.

The nitrogen business had third-quarter operating income of $46.5 million on net sales of $74.2 million, versus the year-ago $13.8 million and $40.8 million, respectively. Nine-month income was $95.6 million on sales of $195.6 million, compared to the year-ago $34.9 million and $115.1 million, respectively.

Nine-month CVR net income was $152.9 million ($1.77 per share) on sales of $4.3 billion, up from the year-ago loss of $43.1 million ($.50 per share) and $1.82 billion.

Third-quarter results were negatively impacted by the use of FIFO accounting to the tune of $59.3 million, but were bolstered by $98.9 million in unrealized gains associated with cash flow swaps. There was also a $33.8 million realized loss on cash flow swaps. Third-quarter results also benefitted from a reversal of non-cash share-based compensation expense of $25.8 million on a pre-tax basis that resulted from a decrease in the company’s common stock share price.