Calumet, Inc. /DE

Previous wording

The historical unaudited condensed consolidated financial statements included in this Quarterly Report reflect all of the assets, liabilities and results of operations of Calumet, Inc. (“Calumet,” the “Company,” “we,” “our,” or “us”). The following discussion analyzes the financial condition and results of operations of the Company for the three and six months ended June 30, 2025. Stockholders should read the following discussion and analysis of our financial condition and results of operations in conjunction with our 2024 Annual Report and our historical unaudited condensed consolidated financial statements and notes included elsewhere in this Quarterly Report.

Current wording

The historical unaudited condensed consolidated financial statements included in this Quarterly Report reflect all of the assets, liabilities and results of operations of Calumet, Inc. (“Calumet,” the “Company,” “we,” “our,” or “us”). The following discussion analyzes the financial condition and results of operations of the Company for the three and nine months ended September 30, 2025. Stockholders should read the following discussion and analysis of our financial condition and results of operations in conjunction with our 2024 Annual Report and our historical unaudited condensed consolidated financial statements and notes included elsewhere in this Quarterly Report.

Previous wording

On July 4, 2025, the United States Congress passed budget reconciliation bill H.R. 1 referred to as the One Big Beautiful Bill Act (the “OBBB”). The OBBB contains several changes to corporate taxation. While we are still assessing the impacts of the OBBB, the provisions that impact us the most are the following:

Current wording

On July 4, 2025, the United States Congress passed budget reconciliation bill H.R. 1 referred to as the One Big Beautiful Bill Act (the “OBBB”). The OBBB contains several changes to corporate taxation. The Company has assessed the impacts of the OBBB, the provisions that impact us the most are the following:

Previous wording

We are evaluating the effects of the legislation on our financial position, results of operations or liquidity in the future; however, we do not expect that the OBBB will have a material impact on our financial position, results of operations and

Current wording

We have evaluated the effects of the legislation on our financial position, results of operations or liquidity in the future; the effects of OBBB will not have a material impact on our financial position, results of operations and liquidity in 2025.

Previous wording

On July 25, 2025, Calumet Shreveport Refining, LLC (“Calumet Shreveport”), a subsidiary of the Company, entered into a Property Schedule No. 2 (“Property Schedule No. 2”) with Stonebriar, which supplements the Master Lease Agreement, dated as of February 12, 2021 (together with Property Schedule No. 2, the “Lease Agreement”), among Calumet Shreveport and Stonebriar. The Lease Agreement relates to a sale and leaseback transaction (the “Sale and Leaseback Transaction”) whereby Calumet Shreveport sold and leased back certain of its property comprising the Shreveport refinery fuels terminal, truck rack and related piping and equipment for consideration of approximately $120 million. The assets sold and leased back do not include any fuels or specialty production inventory. The Lease Agreement has a seven-year term and requires Calumet Shreveport to make monthly rental payments of approximately $1.8 million, which represents a cost of capital of approximately 10.75% per year. The Lease Agreement provides that, subject to certain conditions, Calumet Shreveport may terminate the lease and repurchase the leased assets after a term of six years for consideration of approximately $42 million. Concurrently with Calumet Shreveport’s entry into the Lease Agreement, the Company reaffirmed a Continuing Guaranty in favor of Stonebriar, pursuant to which the Company guarantees to Stonebriar the performance of Calumet Shreveport’s obligations under the Lease Agreement.

Current wording

On July 25, 2025, Calumet Shreveport Refining, LLC (“Calumet Shreveport”), a subsidiary of the Company, entered into a Property Schedule No. 2 (“Property Schedule No. 2”) with Stonebriar, which supplements the Master Lease Agreement, dated as of February 12, 2021 (together with Property Schedule No. 2, the “Lease Agreement”), among Calumet Shreveport and Stonebriar. The Lease Agreement relates to a sale and leaseback transaction (the “Shreveport Terminal Asset Financing Arrangement”) whereby Calumet Shreveport sold and leased back certain of its property comprising the Shreveport refinery fuels terminal, truck rack and related piping and equipment for consideration of approximately $120.0 million. The assets sold and leased back do not include any fuels or specialty production inventory. The Lease Agreement has a seven-year term and requires Calumet Shreveport to make monthly rental payments of approximately $1.8 million, which represents a cost of capital of approximately 10.75% per year. The Lease Agreement provides that, subject to certain conditions, Calumet Shreveport may terminate the lease and repurchase the leased assets after a term of six years for consideration of approximately $42.0 million. Concurrently with Calumet Shreveport’s entry into the Lease Agreement, the Company reaffirmed a Continuing Guaranty in favor of Stonebriar, pursuant to which the Company guarantees to Stonebriar the performance of Calumet Shreveport’s obligations under the Lease Agreement.

Previous wording

Concurrently with the entry into the Lease Agreement, Calumet Shreveport and Stonebriar terminated Property Schedule No. 1, dated as of February 12, 2021 (“Property Schedule No. 1”), among Calumet Shreveport and Stonebriar. The Company applied approximately $40 million of the proceeds of the Sale and Leaseback Transaction to pay all of Calumet Shreveport’s outstanding obligations under Property Schedule No. 1.

Current wording

Concurrently with the entry into the Lease Agreement, Calumet Shreveport and Stonebriar terminated Property Schedule No. 1, dated as of February 12, 2021 (“Property Schedule No. 1”), among Calumet Shreveport and Stonebriar. The Company applied approximately $40.0 million of the proceeds of the Shreveport Terminal Asset Financing Arrangement to pay all of Calumet Shreveport’s outstanding obligations under Property Schedule No. 1.

Previous wording

On July 28, 2025, the Issuers delivered a notice of partial redemption for $80.0 million aggregate principal amount of the outstanding 2026 Notes at a redemption price of par, plus accrued and unpaid interest to, but not including, the redemption date. The redemption date for the 2026 Notes provided in the notice of partial redemption is August 12, 2025.

Current wording

On August 12, 2025, the Issuers partially redeemed $80.0 million aggregate principal amount of the outstanding 2026 Notes at a redemption price of par, plus accrued and unpaid interest to, but not including, the redemption date.

Previous wording

On January 10, 2025, MRL and the DOE, as guarantor and loan servicer, executed the DOE Loan for a $1.44 billion guaranteed loan facility to fund the construction and expansion of the renewable fuels facility owned by MRL. The loan guarantee is structured in two tranches, with the first tranche of approximately $781.8 million disbursed on February 18, 2025 (the “Funding Date”) to fund eligible expenses previously incurred by MRL. MRL has the ability to draw additional tranches of up to $658.0 million through a delayed draw construction facility from the beginning of construction in 2025 through the anticipated completion of the MaxSAFTM project in 2028, which includes a series of discrete, modular projects to enhance MRL’s SAF capacity. Under the MaxSAFTM project, we are planning to increase SAF capacity to approximately 150 million gallons per year within two years and approximately 300 million gallons at the completion of the project. The second tranche under the DOE Loan is subject to the achievement of certain milestone conditions. As a result, we can provide no assurance on the funding of the second tranche under the DOE Loan. Borrowings under the DOE Loan are obligations of our unrestricted subsidiaries MRL and MRHL solely, and are non-recourse to the Company and its restricted subsidiaries.

Current wording

On January 10, 2025, MRL and the DOE, as guarantor and loan servicer, executed the DOE Loan for a $1.44 billion guaranteed loan facility to fund the construction and expansion of the renewable fuels facility owned by MRL. The loan guarantee is structured in two tranches, with the first tranche of approximately $781.8 million disbursed on February 18, 2025 (the “Funding Date”) to fund eligible expenses previously incurred by MRL. MRL has the ability to draw additional tranches of up to $658.0 million through a delayed draw construction facility from the beginning of construction in 2025 through the anticipated completion of the MaxSAFTM project in 2028, which includes a series of discrete, modular projects to enhance MRL’s SAF capacity. Under the MaxSAFTM project, we are planning to increase SAF capacity to approximately 150 million gallons per year within two years and approximately 300 million gallons at the completion of the project. The second tranche under the DOE Loan is subject to the achievement of certain milestone conditions. As a result, we can provide no assurance on the funding of the second tranche under the DOE Loan. Borrowings under the DOE Loan are obligations of our unrestricted subsidiaries MRL and MRHL solely, and are non-recourse to the Company and its restricted subsidiaries. As of September 30, 2025, the Company has capitalized $23.7 million of accrued interest into the principal balance of the DOE loan in accordance with the terms of the agreement which allows capitalization of up to $232.8 million of interest. Interest expense is calculated based on the total principal balance including any capitalized interest.

Previous wording

During the second quarter of 2025, our business benefited from improvement in commodity margins relative to the first quarter and continued strength in specialty margins. Demand for our products remains strong across the enterprise. Our Montana Renewables facility achieved a quarterly production record during the second quarter of 2025. The facility continued to outperform its operational cost target of $0.70 per gallon. Additionally, we continue to benefit from enhanced operational performance following the capital investments we have made over the past few years on projects designed to improve asset reliability. We continue to monitor the potential of tariffs across our business, but expect minimal impact given our U.S. based production footprint.

Current wording

During the third quarter of 2025, our business benefited from improvement in commodity margins relative to the second quarter and continued strength in specialty margins. Demand for our products remains strong across the enterprise. Our Specialty Products & Solutions segment achieved a quarterly production record during the third quarter of 2025, as we continue to benefit from enhanced operational performance following the capital investments we have made over the past few years on projects designed to improve asset reliability. Also, our Montana Renewables facility continued to outperform its operational cost target of $0.70 per gallon.

Previous wording

In our Specialties Products and Solutions and Performance Brands segments, we continue to benefit from an attractive specialty product margin environment. Compared to the first quarter, our fuels and asphalt business benefitted from improved commodity margins related to the beginning of the driving season. Demand for our products in these businesses remained strong in comparison to historical averages and we continue to leverage the benefits of our fully integrated specialty business in this market. We expect the current margin environment for both specialty products and fuel based products to continue into the third quarter of 2025. Also, during the current quarter, our Shreveport facility successfully completed a major planned turnaround, on time and on budget. The facility is now fully operational, and we anticipate strong and consistent production throughout the remainder of 2025. Further, we believe low unemployment and stabilizing raw material and packaging costs point to a continuation of healthy demand for the majority of our products. While the risk of recession and inflation continue to be monitored, our plants and the industry are expected to operate at high rates to meet market demand.

Current wording

In our Specialties Products and Solutions and Performance Brands segments, we continue to benefit from an attractive specialty product margin environment. Compared to the second quarter, our fuels and asphalt business benefitted from improved commodity margins. Demand for our products in these businesses remained strong in comparison to historical averages and we continue to leverage the benefits of our fully integrated specialty business in this market. We expect the current margin environment for both specialty products and fuel based products to continue into the fourth quarter of 2025, offset by normal seasonal weakness.

Previous wording

In our Montana/Renewables segment, we maintain our outlook of strong demand for renewable fuel products, including those we produce. We believe long-term demand for renewable fuel products will continue to grow as a result of the increased Federal policy focus on domestic fuel production, expansion of both voluntary and mandatory corporate decarbonization targets, particularly the global aviation industry, strategic alignment with the agricultural industry as a source of renewable feedstocks, broad sustainability initiatives, and Federal, State, Provincial and local governmental mandates and incentives that have been passed or announced in North America and globally. In aviation, forecasted SAF

Current wording

In our Montana/Renewables segment, we maintain our outlook of strong demand for renewable fuel products, including those we produce. We believe long-term demand for renewable fuel products will continue to grow as a result of the increased Federal policy focus on domestic fuel production, expansion of both voluntary and mandatory corporate decarbonization targets, particularly the global aviation industry, strategic alignment with the agricultural industry as a source of renewable feedstocks, broad sustainability initiatives, and Federal, State, Provincial and local governmental mandates and incentives that have been passed or announced in North America and globally. In aviation, forecasted SAF availability falls short of the necessary emissions reductions that would be required to reach established decarbonization and/or net-zero goals, which will drive SAF pricing. We believe that our advantage as a first-mover in the renewable fuels market positions us as a key producer for potential offtake partners to help them reach their announced targets.

Previous wording

Our Montana specialty asphalt facility continues to be favorably impacted as a result of our strategic location and timely export of wholesale volumes, as well as the beginning of the retail asphalt and paving season. These improvements were offset by inflated WCS prices in comparison to historical averages. The facility remains strategically advantaged due to its local access to cost-advantaged Canadian conventional crude oil, while producing additional fuels and refined products for delivery into the regional market. Due to its strategic location and logistical capabilities, we believe that our Montana specialty asphalt facility is well-positioned to continue to serve long-standing customers in the regional market.

Current wording

tighter WCS-WTI differentials in comparison to historical averages. The facility remains strategically advantaged due to its local access to cost-advantaged Canadian conventional crude oil, while producing additional fuels and refined products for delivery into the regional market. Due to its strategic location and logistical capabilities, we believe that our Montana specialty asphalt facility is well-positioned to continue to serve long-standing customers in the regional market.

Previous wording

For a summary of litigation and other contingencies, please read Note 6 — “Commitments and Contingencies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements.” Based on information available to us at the present time, we do not believe that any liabilities beyond the amounts already accrued, which may result from these contingencies, will have a material adverse effect on our liquidity, financial condition or results of operations.

Current wording

For a summary of litigation and other contingencies, refer to Note 5 — “Commitments and Contingencies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements.” Based on information available to us at the present time, we do not believe that any liabilities beyond the amounts already accrued, which may result from these contingencies, will have a material adverse effect on our liquidity, financial condition or results of operations.

Previous wording

We reported a net loss of $147.9 million in the second quarter 2025 versus a net loss of $39.1 million in the second quarter 2024. We reported Adjusted EBITDA (as defined in Note 12 — “Segments and Related Information” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements”) of $55.1 million in the second quarter 2025 versus $74.8 million in the second quarter 2024. We generated cash from operating activities of $2.6 million in the second quarter 2025 versus generating cash from operating activities of $66.5 million in the second quarter of 2024.

Current wording

We reported net income of $313.4 million in the third quarter 2025 versus a net loss of $100.6 million in the third quarter 2024. We reported Adjusted EBITDA (as defined in Note 11 — “Segments and Related Information” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements”) of $69.6 million in the third quarter 2025 versus $59.8 million in the third quarter 2024. We generated cash from operating activities of $23.5 million in the third quarter 2025 versus using cash from operating activities of $15.5 million in the third quarter of 2024.

Previous wording

Please read Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Non-GAAP Financial Measures” for a reconciliation of EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes to Net income (loss), our most directly comparable financial performance measure calculated and presented in accordance with U.S. generally accepted accounting principles (“GAAP”).

Current wording

Refer to Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Non-GAAP Financial Measures” for a reconciliation of EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes to Net income (loss), our most directly comparable financial performance measure calculated and presented in accordance with U.S. generally accepted accounting principles (“GAAP”).

Previous wording

Montana/Renewables segment Adjusted EBITDA with Tax Attributes was $16.3 million in the second quarter 2025 versus $8.7 million in the second quarter 2024. Our Montana specialty asphalt business was favorably impacted as a result of timely export of wholesale volumes as well as the beginning of the retail asphalt and paving season. The segment as a whole benefitted from continued focus on operating cost efficiency, highlighted by the significant cost reductions for wash water and process materials as a result of improving certain operating unit efficiency at both our Montana Renewables facility and legacy Montana specialty asphalt facility. Montana/Renewables segment Adjusted EBITDA with Tax Attributes was affected by the phase out of the Blender’s Tax Credit (“BTC”) and the introduction of the Section 45Z Clean Fuel Production Tax Credit (“PTC”). While the BTC provided for a static credit of approximately $1.00 per gallon

Current wording

Montana/Renewables segment Adjusted EBITDA with Tax Attributes was $17.1 million in the third quarter 2025 versus $14.6 million in the third quarter 2024. Our Montana specialty asphalt business was favorably impacted as a result of timely export of wholesale volumes as well as a strong retail asphalt and paving season. The segment as a whole has sustained the favorable benefit of operating cost improvements, highlighted by the significant cost reductions for wash water and process materials as a result of improving certain operating unit efficiency at both our Montana Renewables facility and legacy Montana specialty asphalt facility. Montana/Renewables segment Adjusted EBITDA with Tax Attributes was affected by the phase out of the Blender’s Tax Credit (“BTC”) and the introduction of the Section 45Z Clean Fuel Production Tax Credit (“PTC”). While the BTC provided for a static credit of approximately $1.00 per gallon on renewable diesel and SAF sales, the value of the PTC is a variable function of feedstock carbon intensity measures. The estimated value of the PTCs we generated in the third quarter of 2025 was approximately $0.50 per gallon.

Previous wording

Performance Brands segment Adjusted EBITDA was $13.5 million in the second quarter 2025 versus $14.1 million in the second quarter 2024. The change primarily reflects the divestiture of the Royal Purple Industrial (“RPI”) business at the end of the first quarter of 2025. As a result, second quarter 2025 results do not include contributions from the RPI business. Results in our Performance Brands segment were favorably impacted from the strong volume growth across high performance products, in particular our TruFuel product line and our integrated Bel-Ray and private label industrial businesses. This segment continues to benefit from strong unit margins, reflective of stabilized input costs in our branded and consumer markets.

Current wording

Performance Brands segment Adjusted EBITDA was $13.2 million in the third quarter 2025 versus $13.6 million in the third quarter 2024. The change primarily reflects the divestiture of the Royal Purple Industrial (“RPI”) business at the end of the first quarter of 2025. As a result, third quarter 2025 results do not include contributions from the RPI business. Results in our Performance Brands segment were favorably impacted from the strong volume growth across high performance products, in particular our TruFuel product line and our integrated Bel-Ray and private label industrial businesses. This segment continues to benefit from strong unit margins, reflective of stabilized input costs in our branded and consumer markets.

Previous wording

Total Corporate costs represented a loss of $20.1 million of Adjusted EBITDA in the second quarter 2025 versus a loss of $20.7 million of Adjusted EBITDA in the second quarter 2024.

Current wording

Total Corporate costs represented a loss of $18.0 million of Adjusted EBITDA in the third quarter 2025 versus a loss of $19.1 million of Adjusted EBITDA in the third quarter 2024.

Previous wording

As of June 30, 2025, we had total liquidity of $379.2 million comprised of $110.6 million of unrestricted cash, $80.0 million of restricted cash and $188.6 million of availability under our credit facilities. As of June 30, 2025, our revolving credit facilities had a $461.4 million borrowing base, $64.4 million in outstanding standby letters of credit and $208.4 million of outstanding borrowings. We believe we will continue to have sufficient liquidity from cash on hand, projected cash flow from operations, borrowing capacity and other means by which to meet our financial commitments, debt service obligations, contingencies, and anticipated capital expenditures for at least the next 12 months. Please read Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional information.

Current wording

As of September 30, 2025, we had total liquidity of $384.4 million comprised of $94.6 million of unrestricted cash, $80.0 million of restricted cash and $209.8 million of availability under our credit facilities. As of September 30, 2025, our revolving credit facilities had a $448.8 million borrowing base, $71.4 million in outstanding standby letters of credit and $167.6 million of outstanding borrowings. We believe we will continue to have sufficient liquidity from cash on hand, projected cash flow from operations, borrowing capacity and other means by which to meet our financial commitments, debt service obligations, contingencies, and anticipated capital expenditures for at least the next 12 months. Refer to Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for additional information.

Previous wording

During the second quarter 2025, we recorded an accrued expense of $90.8 million for RINs, as compared to an accrued expense of $20.2 million for RINs in the second quarter 2024. Our gross RINs Obligation, which includes RINs that are required to be secured through either our own blending or through the purchase of RINs in the open market, is spread across four compliance categories (D3, D4, D5 and D6). The gross RINs obligations may be satisfied by our own renewables blending, RIN purchases, or receipt of small refinery exemptions.

Current wording

During the third quarter 2025, we recorded an accrued benefit of $333.3 million for RIN in cost of sales in the unaudited condensed statements of operations, as compared to an accrued expense of $42.8 million for RINs in the third quarter 2024. Our gross RINs Obligation, which includes RINs that are required to be secured through either our own blending or through the purchase of RINs in the open market, is spread across four compliance categories (D3, D4, D5 and D6). The gross RINs obligations may be satisfied by our own renewables blending, RIN purchases, or receipt of small refinery exemptions.

Previous wording

Our primary raw materials are crude oil, renewable feedstocks, and other specialty feedstocks, and our primary outputs are specialty consumer-facing and industrial products, specialty branded products, fuel products, and renewable fuel products. The prices of crude oil, specialty products, fuel products, and renewable fuel products are subject to fluctuations in response to changes in supply, demand, market uncertainties and a variety of factors beyond our control. We monitor these risks and from time-to-time enter into derivative instruments designed to help mitigate the impact of commodity price fluctuations on our business. The primary purpose of our commodity risk management activities is to economically hedge our cash flow exposure to commodity price risk. We also may hedge when market conditions exist that we believe to be out of the ordinary and particularly supportive of our financial goals. We enter into derivative contracts for future periods in quantities that do not exceed our projected purchases of crude oil and natural gas and sales of fuel and renewable fuel products. Please read Note 9 — “Derivatives” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information.

Current wording

in response to changes in supply, demand, market uncertainties and a variety of factors beyond our control. We monitor these risks and from time-to-time enter into derivative instruments designed to help mitigate the impact of commodity price fluctuations on our business. The primary purpose of our commodity risk management activities is to economically hedge our cash flow exposure to commodity price risk. We also may hedge when market conditions exist that we believe to be out of the ordinary and particularly supportive of our financial goals. We enter into derivative contracts for future periods in quantities that do not exceed our projected purchases of crude oil and natural gas and sales of fuel and renewable fuel products. Refer to Note 8 — “Derivatives” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information.

Previous wording

The following table reflects our unaudited condensed consolidated results of operations and includes the non-GAAP financial measures EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes. For a reconciliation of EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes to Net income (loss), our most directly comparable financial performance measure calculated and presented in accordance with GAAP, please read “— Non-GAAP Financial Measures.”

Current wording

The following table reflects our unaudited condensed consolidated results of operations and includes the non-GAAP financial measures EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes. For a reconciliation of EBITDA, Adjusted EBITDA, and Adjusted EBITDA with Tax Attributes to Net income (loss), our most directly comparable financial performance measure calculated and presented in accordance with GAAP, refer to “— Non-GAAP Financial Measures.”

Previous wording

The definition of Adjusted EBITDA presented in this Quarterly Report is similar to the calculation of “Consolidated Cash Flow” contained in the indentures governing our Senior Notes (as defined in this Quarterly Report) and the calculation of “Consolidated EBITDA” contained in the Credit Agreement. We are required to report Consolidated Cash Flow to the holders of our Senior Notes and Consolidated EBITDA to the lenders under our revolving credit facility, and these measures are used by them to determine our compliance with certain covenants governing those debt instruments. Please read Note 8 — “Long-Term Debt” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” in this Quarterly Report for additional details regarding the covenants governing our debt instruments.

Current wording

The definition of Adjusted EBITDA presented in this Quarterly Report is similar to the calculation of “Consolidated Cash Flow” contained in the indentures governing our Senior Notes (as defined in this Quarterly Report) and the calculation of “Consolidated EBITDA” contained in the Credit Agreement. We are required to report Consolidated Cash Flow to the holders of our Senior Notes and Consolidated EBITDA to the lenders under our revolving credit facility, and these measures are used by them to determine our compliance with certain covenants governing those debt instruments. Refer to Note 7 — “Long-Term Debt” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” in this Quarterly Report for additional details regarding the covenants governing our debt instruments.

Previous wording

*Sales.*Sales decreased $107.1 million, or 9.4%, to $1,026.6 million in the three months ended June 30, 2025, from $1,133.7 million in the same period in 2024. Sales for each of our principal product categories in these periods were as follows:

Current wording

*Sales.*Sales decreased $22.4 million, or 2.0%, to $1,078.0 million in the three months ended September 30, 2025, from $1,100.4 million in the same period in 2024. Sales for each of our principal product categories in these periods were as follows:

Previous wording

Specialty Products and Solutions segment sales decreased period over period, primarily driven by a decrease in crude oil prices compared to the prior period. The volumes impact was the result of the turnaround conducted at our Shreveport facility in the current quarter as well as the supply chain disruptions caused by a rail provider’s operational issues that delayed shipments.

Current wording

Specialty Products and Solutions segment sales decreased period over period, primarily driven by a decrease in crude oil prices compared to the prior period. This impact was partially offset by an increase in volumes as a result of a strong market.

Previous wording

Montana/Renewables segment sales increased primarily due to higher production volumes at our Montana Renewables facility during the current quarter compared to the prior period. This impact was coupled with the favorable volumes impact at our Montana specialty asphalt facility as a result of the reduction of feedstock and intermediates inventories in the current period. These impacts were partially offset by lower fuels prices.

Current wording

Montana/Renewables segment sales increased primarily due to higher renewable fuels product prices at our Montana Renewables facility during the current quarter compared to the prior period. This impact was partially offset by lower pipeline crude sales volumes at our Montana specialty asphalt facility.

Previous wording

Gross Profit. Gross profit decreased $107.4 million, or 168.3%, to a gross loss of $43.6 million in the three months ended June 30, 2025, from gross profit of $63.8 million in the same period in 2024. Gross profit (loss) for our business segments were as follows:

Current wording

Gross Profit. Gross profit increased $368.8 million to gross profit of $373.7 million in the three months ended September 30, 2025, from gross profit of $4.9 million in the same period in 2024. Gross profit (loss) for our business segments were as follows:

Previous wording

The decrease in Specialty Products and Solutions segment gross profit for the three months ended June 30, 2025 as compared to the same period in 2024, was primarily due to the impact of RINs prices. The mark-to-market impact of RINs prices resulted in a RINs expense of $55.4 million in the current period, as compared to an expense of $8.4 million in the prior year period. The favorable margin impact was the result of higher fuels and specialties margins during the current quarter. This impact was partially offset by lower production volumes as a result of the major turnaround conducted at our Shreveport facility. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to our accounting for RINs.

Current wording

The increase in Specialty Products and Solutions segment gross profit for the three months ended September 30, 2025 as compared to the same period in 2024, was primarily due to the de-recognition of the RINs Obligation on the Company’s balance sheet for the SRE exemptions received by EPA in August 2025. The favorable margin impact was the result of higher commodity margins, coupled with lower crude oil costs, during the current quarter. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to our accounting for RINs.

Previous wording

The decrease in Montana/Renewables segment gross profit for the three months ended June 30, 2025, as compared to the same period in 2024, was primarily due to the mark-to-market impact of RINs prices and the regulatory change from BTC to PTC at Montana Renewables. The mark-to-market impact of RINs prices resulted in a RINs mark-to-market expense of $23.7 million in the current period, as compared to an expense of $3.8 million in the prior year period. The unfavorable impact associated with cost of materials was primarily the result of the regulatory change from BTC to PTC. In the prior year period, Montana Renewables’ cost of materials benefited approximately $1.00 per gallon from the BTC, whereas this benefit is reduced to zero in the current period, as the PTC is accounted for as a deferred tax asset and not recognized in cost of sales. Our Montana specialty asphalt business was favorably impacted as a result of timely export of wholesale volumes as well as the beginning of the retail asphalt and paving season. The segment as a whole benefited from continued focus on operating cost efficiency, highlighted by the significant cost reductions for wash water and process materials as a result of improving certain operating unit efficiency at both our Montana Renewables facility and legacy Montana specialty asphalt facility. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to our accounting for RINs.

Current wording

The increase in Montana/Renewables segment gross profit for the three months ended September 30, 2025, as compared to the same period in 2024, was primarily due to the de-recognition of the RINs Obligation on the Company’s balance sheet for the SRE exemptions received by EPA in August 2025. The unfavorable impact associated with cost of materials was primarily the result of the regulatory change from BTC to PTC. In the prior year period, Montana Renewables’ cost of materials benefited approximately $1.00 per gallon from the BTC, whereas this benefit is reduced to zero in the current period, as the PTC is accounted for as a deferred tax asset and not recognized in cost of sales. Our Montana specialty asphalt business was favorably impacted by the continued export of wholesale volumes and improvements in crack spreads. The segment as a whole benefited from continued focus on operating cost efficiency, highlighted by the significant cost reductions for wash water and process materials as a result of improving certain operating unit efficiency at both our Montana Renewables facility and legacy Montana specialty asphalt facility. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to our accounting for RINs.

Previous wording

Changes in Results of Operations for the Six Months Ended June 30, 2025 and 2024

Current wording

Changes in Results of Operations for the Nine Months Ended September 30, 2025 and 2024

Previous wording

Sales. Sales decreased $119.0 million, or 5.6%, to $2,020.5 million in the six months ended June 30, 2025, from $2,139.5 million in the same period in 2024. Sales for each of our principal product categories in these periods were as follows:

Current wording

Sales. Sales decreased $141.4 million, or 4.4%, to $3,098.5 million in the nine months ended September 30, 2025, from $3,239.9 million in the same period in 2024. Sales for each of our principal product categories in these periods were as follows:

Previous wording

Specialty Products and Solutions segment sales decreased period over period, primarily due to the lower commodity price environment in the current year period. While market demand remained strong in the current year period, sales were unfavorably impacted by lower volumes as a result of the planned turnaround that was conducted at our Shreveport facility in the current year period, coupled with the supply chain disruptions caused by a rail provider’s operational issues that delayed shipments.

Current wording

Specialty Products and Solutions segment sales decreased period over period, primarily due to lower crude oil prices in the current year period. Although underlying market demand remained strong, sales volumes were impacted by a planned turnaround at our Shreveport facility and short-term rail provider disruptions that delayed shipments in the current year period.

Previous wording

Montana/Renewables segment sales increased primarily due to higher production volumes at our Montana Renewables facility during the current quarter compared to the prior period. This impact was coupled with the favorable volumes impact at our Montana specialty asphalt facility as a result of the reduction of feedstock and intermediates inventories in the current period. These impacts were partially offset by lower fuels prices.

Current wording

Montana/Renewables segment sales increased primarily due to higher renewable fuels product prices at our Montana Renewables facility during the current year compared to the prior period. This was coupled with the favorable volumes impact at our Montana specialty asphalt facility as a result of the reduction of feedstock and intermediates inventories in the current period. Strong production at our Montana Renewables facility during the current year period also resulted in a favorable volumes impact.

Previous wording

Gross Profit. Gross profit decreased $267.3 million, or 187.8%, to a gross loss of $125.0 million in the six months ended June 30, 2025, from gross profit of $142.3 million in the same period in 2024. Gross profit for our business segments were as follows:

Current wording

Gross Profit. Gross profit increased $101.5 million, or 69.0%, to gross profit of $248.7 million in the nine months ended September 30, 2025, from gross profit of $147.2 million in the same period in 2024. Gross profit for our business segments were as follows:

Previous wording

The decrease in Specialty Products and Solutions segment gross profit for the six months ended June 30, 2025 as compared to the same period in 2024, was primarily due to the impact of RINs prices. The mark-to-market impact of RINs prices resulted in a RINs expense of $116.1 million in the current period, as compared to a benefit of $39.5 million in the prior year period. The favorable margin impact was primarily the result of the strengthened commodity margin environment for fuels products. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to our accounting for RINs.

Current wording

The increase in Specialty Products and Solutions segment gross profit for the nine months ended September 30, 2025 as compared to the same period in 2024, was primarily due to the de-recognition of the RINs Obligation on the Company’s balance sheet for the SRE exemptions received by EPA in August 2025. The favorable margin impact was primarily the result of the strengthened commodity margin environment for fuels products, coupled with lower crude oil prices. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to our accounting for RINs.

Previous wording

The decrease in Montana/Renewables segment gross profit for the six months ended June 30, 2025, as compared to the same period in 2024, was primarily due to the mark-to-market impact of RINs prices and the regulatory change from BTC to PTC at Montana Renewables. The mark-to-market impact of RINs prices resulted in a RINs mark-to-market expense of $49.8 million in the current period, as compared to a benefit of $19.4 million in the prior year period. The unfavorable impact associated with cost of materials was primarily the result of the regulatory change from BTC to PTC. In the prior year period, Montana Renewables’ cost of materials benefited approximately $1.00 per gallon from the BTC, whereas this benefit is reduced to zero in the current period, as the PTC is accounted for as a deferred tax asset and not recognized in cost of sales. Our Montana specialty asphalt business was favorably impacted as a result of timely export of wholesale volumes as well as the beginning of the retail asphalt and paving season. The segment as a whole benefited from continued focus on operating cost efficiency, highlighted by the significant cost reductions for wash water and process materials as a result of improving certain operating unit efficiency at both our Montana Renewables facility and legacy Montana specialty asphalt facility. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to our accounting for RINs.

Current wording

The increase in Montana/Renewables segment gross profit for the nine months ended September 30, 2025, as compared to the same period in 2024, was primarily due to the de-recognition of the RINs Obligation on the Company’s balance sheet for the SRE exemptions received by EPA in August 2025. The unfavorable impact associated with cost of materials was primarily the result of the regulatory change from BTC to PTC. In the prior year period, Montana Renewables’ cost of materials benefited approximately $1.00 per gallon from the BTC, whereas this benefit is reduced to zero in the current period, as the PTC is accounted for as a deferred tax asset and not recognized in cost of sales. Our Montana specialty asphalt business was favorably impacted by the continued export of wholesale volumes and improvements in crack spreads. The segment as a whole benefited from continued focus on operating cost efficiency, highlighted by the significant cost reductions for wash water and process materials as a result of improving certain operating unit efficiency at both our Montana Renewables facility and legacy Montana specialty asphalt facility. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to our accounting for RINs.

Previous wording

The decrease in Performance Brands segment gross profit for the six months ended June 30, 2025, as compared to the same period in 2024, was primarily due to the divestiture of the Royal Purple Industrial business in the current year period. This segment continues to benefit from strong unit margins, reflective of stabilized input costs in our branded and consumer markets.

Current wording

The decrease in Performance Brands segment gross profit for the nine months ended September 30, 2025, as compared to the same period in 2024, was primarily due to the divestiture of the Royal Purple Industrial business in the current year period. This segment continues to benefit from strong unit margins, reflective of stabilized input costs in our branded and consumer markets.

Previous wording

*Gain on sale of business.*There was a $62.2 million gain on sale of business in the six months ended June 30, 2025 for the sale of assets related to the industrial portion of our the Royal Purple® business. There was no gain or loss for the sale of a business recorded in the same period in 2024. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to the sale of assets related to the industrial portion of the Royal Purple® business.

Current wording

*Gain on sale of business.*There was a $55.8 million gain on sale of business in the nine months ended September 30, 2025 for the sale of assets related to the industrial portion of our the Royal Purple® business. There was no gain or loss for the sale of a business recorded in the same period in 2024. Refer to Note 2 — “Summary of Significant Accounting Policies” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information related to the sale of assets related to the industrial portion of the Royal Purple® business.

Previous wording

*Debt extinguishment costs.*There was a $47.7 million expense for debt extinguishment costs in the six months ended June 30, 2025 related to the repurchase of the equipment associated with the MRL Asset Financing Arrangements, repayment of outstanding loans under the MRL Term Loan Credit Agreement and MRL Revolving Credit Agreement and repayment of outstanding obligations under the MRL Supply and Offtake Agreement. Debt extinguishment expense recorded in the same period in 2024 was a de-minimis amount. Refer to Note 8 — “Long-Term Debt” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information.

Current wording

repayment of outstanding loans under the MRL Term Loan Credit Agreement and MRL Revolving Credit Agreement and repayment of outstanding obligations under the MRL Supply and Offtake Agreement. Debt extinguishment expense recorded in the same period in 2024 was a de-minimis amount. Refer to Note 7 — “Long-Term Debt” under Part I, Item 1 “Financial Statements — Notes to Unaudited Condensed Consolidated Financial Statements” for additional information.

Previous wording

Operating Activities. Operating activities used cash of $108.0 million during the six months ended June 30, 2025 compared to using cash of $27.5 million during the same period in 2024. The change was primarily related to cash payments for debt extinguishment costs in the current year period, absent the prior year period. This impact was coupled with the impact of an increase in the cash required for working capital during the current year period.

Current wording

Operating Activities. Operating activities used cash of $7.6 million during the nine months ended September 30, 2025 compared to using cash of $43.0 million during the same period in 2024. This change was primarily related to an increase in the cash required for working capital during the current year period.

Previous wording

Investing Activities. Investing activities provided cash of $64.2 million during the six months ended June 30, 2025 compared to a use of cash of $35.0 million during the same period in 2024. The change is related to the net proceeds received for the sale of the Royal Purple Industrial business in the current year period. Cash expenditures for additions to property, plant and equipment in the current year period were flat in comparison to the prior year.

Current wording

Investing Activities. Investing activities provided cash of $55.8 million during the nine months ended September 30, 2025 compared to a use of cash of $51.7 million during the same period in 2024. The change is related to the net proceeds received for the sale of the Royal Purple Industrial business in the current year period. Cash expenditures for additions to property, plant and equipment in the current year period were essentially flat in comparison to the prior year.