Guarantor Financial Information

9 Months Ended

Sep. 30, 2019

Condensed Financial Information Disclosure [Abstract]

(15) Guarantor Financial Information

CVR Refining’s 2022 Senior Notes are guaranteed on a senior unsecured basis by the Company and certain wholly-owned subsidiaries, including CVR Refining and certain of its subsidiaries (the “Guarantors”). The guarantees are full and unconditional and joint and several among the Guarantors.

The information is presented in accordance with the requirements of Rule 3-10 under the SEC’s Regulation S-X and prepared on the equity basis of accounting. The financial information may not necessarily be indicative of results of operations, cash flows or financial position had the Guarantors operated as independent entities. The Company has not presented separate financial and narrative information for each of the Guarantors because it believes such financial and narrative information would not provide any additional information that would be material in evaluating the sufficiency of the Guarantors.

Condensed Consolidated Balance Sheet



	September 30, 2019
(in millions)	Parent		Subsidiary Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Intercompany Elimination			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	5	$	548	$	54	$	85		$	—		$	692
Accounts receivable	—		—		166		15			—			181
Intercompany receivable	6		—		—		20			(26		)	—
Inventories	—		—		331		57			—			388
Prepaid expenses and other current assets	100		2		—		13			(49		)	66
Total current assets	111		550		551		190			(75		)	1,327
Property, plant and equipment, net of accumulated depreciation	—		1		1,388		967			—			2,356
Investment in and advances from subsidiaries	1,332		1,589		435		424			(3,780		)	—
Other long-term assets	—		4		226		49			—			279
Total assets	$	1,443	$	2,144	$	2,600	$	1,630		$	(3,855	)	$	3,962
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1	$	2	$	347	$	40		$	—		$	390
Intercompany payables	—		—		26		—			(26		)	—
Other current liabilities	6		25		41		177			(49		)	200
Total current liabilities	7		27		414		217			(75		)	590
Long-term liabilities:
Long-term debt and finance lease obligations, net of current portion	—		497		61		632			—			1,190
Investment and advances from subsidiaries	—		—		—		1,046			(1,046		)	—
Deferred income taxes	3		—		—		402			—			405
Other long-term liabilities	4		1		33		14			—			52
Total long-term liabilities	7		498		94		2,094			(1,046		)	1,647
Commitments and contingencies
Equity:
Total CVR stockholders’ equity	1,429		1,619		2,092		(977		)	(2,734		)	1,429
Noncontrolling interest	—		—		—		296			—			296
Total equity	1,429		1,619		2,092		(681		)	(2,734		)	1,725
Total liabilities and equity	$	1,443	$	2,144	$	2,600	$	1,630		$	(3,855	)	$	3,962

Condensed Consolidated Balance Sheet



	December 31, 2018
(in millions)	Parent			Subsidiary Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Intercompany Elimination			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	3		$	349	$	252	$	64		$	—		$	668
Accounts receivable	—			—		107		62			—			169
Intercompany receivable	6			—		4		—			(10		)	—
Inventories	—			—		316		64			—			380
Prepaid expenses and other current assets	31			2		47		3			(7		)	76
Total current assets	40			351		726		193			(17		)	1,293
Property, plant and equipment, net of accumulated depreciation	—			3		1,409		1,018			—			2,430
Investment in and advances from subsidiaries	1,263			1,693		173		—			(3,129		)	—
Other long-term assets	—			2		231		44			—			277
Total assets	$	1,303		$	2,049	$	2,539	$	1,255		$	(3,146	)	$	4,000
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1		$	3	$	291	$	25		$	—		$	320
Intercompany payables	—			—		—		10			(10		)	—
Other current liabilities	6			14		65		98			(7		)	176
Total current liabilities	7			17		356		133			(17		)	496
Long-term liabilities:
Long-term debt and finance lease obligations, net of current portion	—			496		42		629			—			1,167
Investment and advances from subsidiaries	—			—		106		993			(1,099		)	—
Deferred income taxes	(24		)	—		—		404			—			380
Other long-term liabilities	3			1		6		4			—			14
Total long-term liabilities	(21		)	497		154		2,030			(1,099		)	1,561
Commitments and contingencies
Equity:
Total CVR stockholders’ equity	1,317			1,207		2,029		(1,237		)	(2,030		)	1,286
Noncontrolling interest	—			328		—		329			—			657
Total equity	1,317			1,535		2,029		(908		)	(2,030		)	1,943
Total liabilities and equity	$	1,303		$	2,049	$	2,539	$	1,255		$	(3,146	)	$	4,000

Condensed Consolidated Statement of Operations



	Three Months Ended September 30, 2019
(in millions)	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Intercompany Eliminations			Consolidated
Net sales	$	—		$	—		$	1,535		$	89		$	(2	)	$	1,622
Operating costs and expenses:
Cost of materials and other	—			—			1,202			21			(2		)	1,221
Direct operating expenses (exclusive of depreciation and amortization as reflected below)	—			—			91			48			—			139
Depreciation and amortization	—			—			51			18			—			69
Cost of sales	—			—			1,344			87			(2		)	1,429
Selling, general and administrative expenses (exclusive of depreciation and amortization as reflected below)	5			2			15			7			—			29
Depreciation and amortization	—			—			2			—			—			2
Loss on asset disposals	—			—			—			3			—			3
Operating income (loss)	(5		)	(2		)	174			(8		)	—			159
Other income (expense):
Interest expense, net	(3		)	(7		)	(2		)	(14		)	—			(26		)
Other income, net	—			—			4			1			—			5
Income (loss) from subsidiaries	136			176			(10		)	(5		)	(297		)	—
Income (loss) before income taxes	128			167			166			(26		)	(297		)	138
Income tax expense	9			—			—			25			—			34
Net income (loss)	119			167			166			(51		)	(297		)	104
Less: Net loss attributable to noncontrolling interest	—			—			—			(15		)	—			(15		)
Net income (loss) attributable to CVR Energy stockholders	$	119		$	167		$	166		$	(36	)	$	(297	)	$	119

Condensed Consolidated Statement of Operations



	Three Months Ended September 30, 2018
(in millions)	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Intercompany Eliminations			Consolidated
Net sales	$	—		$	—		$	1,857		$	81		$	(3	)	$	1,935
Operating costs and expenses:
Cost of materials and other	—			—			1,539			20			(3		)	1,556
Direct operating expenses (exclusive of depreciation and amortization as reflected below)	—			—			84			35			—			119
Depreciation and amortization	—			—			46			17			—			63
Cost of sales	—			—			1,669			72			(3		)	1,738
Selling, general and administrative expenses (exclusive of depreciation and amortization as reflected below)	4			2			14			7			—			27
Depreciation and amortization	—			1			2			—			—			3
Loss on asset disposals	—			—			1			—			—			1
Operating income (loss)	(4		)	(3		)	171			2			—			166
Other income (expense):
Interest expense, net	—			(9		)	(2		)	(15		)	—			(26		)
Other income, net	—			—			3			—			—			3
Income (loss) from subsidiaries	84			173			(10		)	(11		)	(236		)	—
Income (loss) before income taxes	80			161			162			(24		)	(236		)	143
Income tax expense (benefit)	(1		)	—			—			34			—			33
Net income (loss)	81			161			162			(58		)	(236		)	110
Less: Net income (loss) attributable to noncontrolling interest	—			38			—			(9		)	—			29
Net income (loss) attributable to CVR Energy stockholders	$	81		$	123		$	162		$	(49	)	$	(236	)	$	81

Condensed Consolidated Statement of Operations



	Nine Months Ended September 30, 2019
(in millions)	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Intercompany Eliminations			Consolidated
Net sales	$	—		$	—		$	4,484		$	318		$	(8	)	$	4,794
Operating costs and expenses:
Cost of materials and other	—			—			3,525			72			(8		)	3,589
Direct operating expenses (exclusive of depreciation and amortization as reflected below)	—			—			269			128			—			397
Depreciation and amortization	—			—			150			60			—			210
Cost of sales	—			—			3,944			260			(8		)	4,196
Selling, general and administrative expenses (exclusive of depreciation and amortization as reflected below)	15			6			45			19			—			85
Depreciation and amortization	—			1			5			1			—			7
(Gain) loss on asset disposals	—			—			(8		)	3			—			(5		)
Operating income (loss)	(15		)	(7		)	498			35			—			511
Other income (expense):
Interest expense, net	(7		)	(15		)	(8		)	(47		)	—			(77		)
Other income, net	—			—			10			—			—			10
Income (loss) from subsidiaries	389			500			(14		)	(21		)	(854		)	—
Income (loss) before income taxes	367			478			486			(33		)	(854		)	444
Income tax expense	31			—			—			79			—			110
Net income (loss)	336			478			486			(112		)	(854		)	334
Less: Net income (loss) attributable to noncontrolling interest	—			5			—			(7		)	—			(2		)
Net income (loss) attributable to CVR Energy stockholders	$	336		$	473		$	486		$	(105	)	$	(854	)	$	336

Condensed Consolidated Statement of Operations



	Nine Months Ended September 30, 2018
(in millions)	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Intercompany Eliminations			Consolidated
Net sales	$	—		$	—		$	5,138		$	253		$	(5	)	$	5,386
Operating costs and expenses:
Cost of materials and other	—			—			4,238			62			(5		)	4,295
Direct operating expenses (exclusive of depreciation and amortization as reflected below)	—			—			269			121			—			390
Depreciation and amortization	—			—			143			53			—			196
Cost of sales	—			—			4,650			236			(5		)	4,881
Selling, general and administrative expenses (exclusive of depreciation and amortization as reflected below)	12			8			44			19			—			83
Depreciation and amortization	—			2			5			1			—			8
Loss on asset disposals	—			—			4			1			—			5
Operating income (loss)	(12		)	(10		)	435			(4		)	—			409
Other income (expense):
Interest expense, net	—			(25		)	(7		)	(47		)	—			(79		)
Other income, net	—			—			6			—			—			6
Income (loss) from subsidiaries	194			431			(34		)	(35		)	(556		)	—
Income (loss) before income taxes	182			396			400			(86		)	(556		)	336
Income tax expense (benefit)	(3		)	—			—			68			—			65
Net income (loss)	185			396			400			(154		)	(556		)	271
Less: Net income (loss) attributable to noncontrolling interest	—			118			—			(32		)	—			86
Net income (loss) attributable to CVR Energy stockholders	$	185		$	278		$	400		$	(122	)	$	(556	)	$	185

Condensed Consolidated Statement of Cash Flows



	Nine Months Ended September 30, 2019
(in millions)	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Intercompany Elimination			Consolidated
Net cash provided by (used in) operating activities	$	(123	)	$	(12	)	$	616		$	172		$	—		$	653

Cash flows from investing activities:
Capital expenditures	—			—			(76		)	(9		)	—			(85		)
Turnaround expenditures	—			—			(24		)	—			—			(24		)
Investment in affiliates, net of return of investment	652			243			263			(22		)	(1,136		)	—
Proceeds from sale of assets	—			—			36			—			—			36
Net cash provided by (used in) investing activities	652			243			199			(31		)	(1,136		)	(73		)

Cash flows from financing activities:
Dividends to CVR Energy stockholders	(225		)	—			—			—			—			(225		)
Acquisition of CVR Refining common units	(301		)	—			—			—			—			(301		)
Distributions to CVR Partners’ noncontrolling interest holders	—			—			—			(25		)	—			(25		)
Distributions or intercompany advances to other CVR Energy subsidiaries	—			(32		)	(1,011		)	(93		)	1,136			—
Other financing activities	(1		)	—			(2		)	(2		)	—			(5		)
Net cash provided by (used in) financing activities	(527		)	(32		)	(1,013		)	(120		)	1,136			(556		)
Net increase (decrease) in cash and cash equivalents	2			199			(198		)	21			—			24
Cash and cash equivalents, beginning of period	3			349			252			64			—			668
Cash and cash equivalents, end of period	$	5		$	548		$	54		$	85		$	—		$	692

Condensed Consolidated Statement of Cash Flows



	Nine Months Ended September 30, 2018
(in millions)	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Intercompany Elimination			Consolidated
Net cash provided by (used in) operating activities	$	(2	)	$	(10	)	$	598		$	(60	)	$	—		$	526

Cash flows from investing activities:
Capital expenditures	—			(2		)	(51		)	(15		)	—			(68		)
Turnaround expenditures	—			—			(7		)	—			—			(7		)
Investment in affiliates, net of return of investment	162			793			383			168			(1,506		)	—
Other investing activities	—			—			1			—			—			1
Net cash provided by (used in) investing activities	162			791			326			153			(1,506		)	(74		)

Cash flows from financing activities:
Dividends to CVR Energy stockholders	(162		)	—			—			—			—			(162		)
Distributions to CVR Refining or CVR Partners’ noncontrolling interest holders	—			—			—			(67		)	—			(67		)
Distributions or intercompany advances to other CVR Energy subsidiaries	—			(550		)	(943		)	(13		)	1,506			—
Other financing activities	—			—			(2		)	(1		)	—			(3		)
Net cash provided by (used in) financing activities	(162		)	(550		)	(945		)	(81		)	1,506			(232		)
Net increase (decrease) in cash and cash equivalents	(2		)	231			(21		)	12			—			220
Cash and cash equivalents, beginning of period	4			163			264			51			—			482
Cash and cash equivalents, end of period	$	2		$	394		$	243		$	63		$	—		$	702