Calumet Specialty Products Partners, L.P. Launches 2020 Phase II Self-Help Initiatives Expected to Contribute Approximately $40 Million of Incremental Adjusted EBITDA

Includes multiple Specialty Products earnings growth initiatives and G&A reductions

INDIANAPOLIS, Jan. 21, 2020 /PRNewswire/ — Calumet Specialty Products Partners, L.P. (NASDAQ: CLMT) (the “Partnership” or “Calumet”), a leading independent producer of specialty hydrocarbon and fuels products, today released details on its 2020 expectation for Phase II of its Self-Help program.   This three-year program was launched in early 2019 following the successful completion of the Partnership’s prior Phase I program that delivered $182 million of incremental Adjusted EBITDA from 2016 through 2018.  Phase II of the program remains on track to deliver an expected $100 million of incremental Adjusted EBITDA from 2019 through 2021.

Strategic Highlights:

• Delivered approximately one third, or $30 million, of the three-year (2019-2021) $100 million of incremental Adjusted EBITDA Phase II Self-Help goal in 2019
• Launched new specialty products growth initiatives, which include two debottlenecking projects, further rationalization and replacement of low margin tolling agreements, and additional finished lubricant expansion projects
• Announced new expense reduction plans designed to right-size General and Administrative (G&A) spending, which are expected to yield annual cost savings of approximately $20 million

“Our Phase I and Phase II Self-Help efforts have delivered over $210 million in incremental Adjusted EBITDA since 2016, and these results have been instrumental in growing our bottom line profitability and providing an improved platform for future growth,” said Tim Go, Chief Executive Officer of Calumet.  “We plan to continue driving specialty products growth, as well as improving our transportation, logistics and procurement costs.”

Go continued, “In 2020, we are prioritizing a number of strategic growth initiatives designed to accelerate our transformation, specifically in the lubricating oils and finished lubricants businesses.  We believe these collective efforts and a stronger cultural focus on driving organic growth can help us deliver approximately $20 million of incremental Adjusted EBITDA in 2020.”

Go concluded, “Lastly, given the divestiture of multiple non-core assets over the last few years and the improved business processes and data analytics resulting from our ERP conversion, we are engaged in reorganizing and realigning the corporate activities within our portfolio.  These efforts are expected to result in an additional annual cost savings of approximately $20 million in Adjusted EBITDA.  We look forward to updating our investors and other stakeholders on our progress on these goals throughout 2020.”

Specialty Growth Initiatives

Specifically, there are three key workstreams that are expected to drive the $20 million of incremental Adjusted EBITDA this year in Specialty Products.  The first is focused on the Partnership’s Lubricating Oils business and includes debottleneck projects at the Princeton facility in the first quarter and another at the Shreveport facility, which was just completed in the fourth quarter of 2019.  Additionally, Calumet has identified further opportunities to rationalize and replace lower margin businesses and tolling agreements to drive better margin capture in the future. 

The second workstream is focused on the Partnership’s Finished Lubricants & Chemicals business and includes debottleneck projects to meet increased demand for engineered fuels and capturing packaging line cost efficiencies. 

The third workstream expected to contribute incremental Adjusted EBITDA is the Partnership’s ongoing initiative to improve transportation, logistics, and procurement costs. We have identified further opportunities to drive costs lower, through the capturing of efficiencies and improvement of our logistics infrastructure much of which has been enabled through better leveraging of our ERP platform.

In total, these efforts are expected to help drive the Partnership to its near-term goals of Specialty Products segment Gross Profit per barrel of $40 and its EBITDA margins over 15%.

Cost Reduction Plan

Calumet has achieved many key milestones over the past five years, including divestitures of four non-core assets, integration of a new ERP system and recent re-segmentation of corporate G&A activities. We believe these achievements now allow the business to undertake a planned reduction in its G&A spending in 2020, which is expected to result in annual Adjusted EBITDA improvement of approximately $20 million.

The primary reductions will focus on reducing outside services, facility fixed costs, and corporate staffing. The Partnership expects to incur approximately $10 million in one-time costs over the course of 2020 to implement this program.

Non-GAAP Financial Measures

The preliminary expected forward-looking incremental Adjusted EBITDA contained in this press release is provided only on a non-GAAP basis due to the inherent difficulty of calculating items that would be included in Net income (loss) on a GAAP basis. As a result, reconciliation of forward-looking incremental Adjusted EBITDA to GAAP Net income (loss) is not available without unreasonable effort.  These amounts that would require unreasonable effort to quantify could be significant, such that the amount of projected GAAP net income would vary substantially from the amount of projected incremental Adjusted EBITDA, and Calumet is unable to address the probable significance of information that is currently unavailable. It is expected that incremental Adjusted EBITDA, when reported, will reflect the exclusion of, among other things, interest expense, depreciation and amortization, and income taxes.

About Calumet Specialty Products Partners, L.P.

Calumet Specialty Products Partners, L.P. (NASDAQ: CLMT) is a master limited partnership and a leading independent producer of high-quality, specialty hydrocarbon products in North America. Calumet processes crude oil and other feedstocks into customized lubricating oils, solvents and waxes used in consumer, industrial and automotive products; produces fuel products including gasoline, diesel and jet fuel. Calumet is based in Indianapolis, Indiana, and operates ten manufacturing facilities located in northwest Louisiana, northern Montana, western Pennsylvania, Texas, New Jersey and eastern Missouri.

Cautionary Statement Regarding Forward-Looking Statements

Certain statements and information in this press release may constitute “forward-looking statements.” The words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could” or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. The statements discussed in this press release that are not purely historical data are forward-looking statements, including, but not limited to, the statements regarding (i) our expectation regarding our business outlook and transformation efforts, (ii) our expectation regarding expense reduction plans and (iii) statements regarding future Adjusted EBITDA contributions attributable to Phase II of our multi-year self-help program. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. All comments concerning our expectations for future operating results are based on our forecasts for our existing operations and do not include the potential impact of any future acquisitions or dispositions. Our forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause our actual results to differ materially from our historical experience and our present expectations or projections. Known material factors that could cause actual results to differ materially from those in the forward-looking statements include: the overall demand for specialty hydrocarbon products, fuels and other refined products; the level of foreign and domestic production of crude oil and refined products; our ability to produce specialty products and fuel products that meet our customers’ unique and precise specifications; the impact of fluctuations and rapid increases or decreases in crude oil and crack spread prices, including the resulting impact on our liquidity; the results of our hedging and other risk management activities; our ability to comply with financial covenants contained in our debt instruments; the availability of, and our ability to consummate, acquisition or combination opportunities and the impact of any completed acquisitions; labor relations; impact of possible divestitures of assets or business; our access to capital, including debt and equity markets, to fund expansions, acquisitions and our working capital needs and our ability to obtain debt or equity financing on satisfactory terms; successful integration and future performance of acquired assets, businesses or third-party product supply and processing relationships; our ability to timely and effectively integrate the operations of acquired businesses or assets, particularly those in new geographic areas or in new lines of business; environmental liabilities or events that are not covered by an indemnity, insurance or existing reserves; maintenance of our credit ratings and ability to receive open credit lines from our suppliers; demand for various grades of crude oil and resulting changes in pricing conditions; fluctuations in refinery capacity; our ability to access sufficient crude oil supply through long-term or month-to-month evergreen contracts and on the spot market; the effects of competition; continued creditworthiness of, and performance by, counterparties; the impact of current and future laws, rulings and governmental regulations, including guidance related to the Dodd-Frank Wall Street Reform and Consumer Protection Act; the costs of complying with the Renewable Fuel Standard, including the prices paid for RINs; shortages or cost increases of power supplies, natural gas, materials or labor; hurricane or other weather interference with business operations; accidents or other unscheduled shutdowns; and general economic, market or business conditions.

For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with the Securities and Exchange Commission, including our latest Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q.

Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise.

SOURCE Calumet Specialty Products Partners, L.P.

For further information: Investor/Media Inquiry Contact: Alpha IR Group, Joe Caminiti or Chris Hodges, Phone: 312-445-2870, CLMT@alpha-ir.com

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Equities analysts predict that Calumet Specialty Products Partners, L.P (NASDAQ:CLMT) will report sales of $790.42 million for the current fiscal quarter, Zacks reports. Two analysts have made estimates for Calumet Specialty Products Partners, L.P’s earnings. The lowest sales estimate is $743.84 million and the highest is $837.00 million. Calumet Specialty Products Partners, L.P reported sales of $1.10 billion in the same quarter last year, which would suggest a negative year-over-year growth rate of 28.1%. The company is scheduled to report its next earnings report on Thursday, December 27th.

According to Zacks, analysts expect that Calumet Specialty Products Partners, L.P will report full year sales of $3.17 billion for the current fiscal year, with estimates ranging from $3.11 billion to $3.24 billion. For the next fiscal year, analysts forecast that the company will report sales of $2.97 billion, with estimates ranging from $2.79 billion to $3.15 billion. Zacks’ sales averages are an average based on a survey of sell-side analysts that that provide coverage for Calumet Specialty Products Partners, L.P.

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INDIANAPOLIS, Sept. 28, 2018 /PRNewswire/ — Calumet Specialty Products Partners, L.P. CLMT, -0.78% a leading independent producer of specialty hydrocarbon and fuels products, today announced that senior management will participate in the 26 [th] annual Deutsche Bank Leveraged Finance Conference in Scottsdale, AZ on Tuesday October 2, 2018.

Management will provide an overview of the Company’s business during a live presentation and will conduct one-on-one meetings with investors who are registered to attend the conference. The presentation will be webcast live at 12:20 PM ET on October 2 [nd] . In addition to the live webcast, these presentations can be accessed by visiting the events section of the investor relations page of the Company’s website at www.calumetspecialty.com.

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Caa1 CFR affirmed

28 Sep 2018

$1.575 billion of rated debt affected

New York, September 28, 2018 — Moody’s Investors Service (Moody’s) changed the ratings outlook for Calumet Specialty Products Partners, L.P. (Calumet) to stable from negative. It also affirmed the Caa1 Corporate Family Rating (CFR) and Caa2 ratings on the existing senior unsecured notes. The Speculative Grade Liquidity Rating was changed to SGL-2 from SGL-3.

The following summarizes the ratings activity.

Calumet Specialty Products Partners, L.P.

Ratings affirmed:

.Corporate Family Rating — affirmed at Caa1
.Probability of Default Rating — affirmed at Caa1-PD
.Senior unsec notes due 2021 — affirmed at Caa2 (LGD4 from LGD5)
.Senior unsec notes due 2022 — affirmed at Caa2 (LGD4 from LGD5)
.Senior unsec notes due 2023 — affirmed at Caa2 (LGD4 from LGD5)

Ratings upgraded:

.Speculative Grade Liquidity Rating — SGL-2 from SGL-3

Outlook Action:

.Outlook — changed to Stable from Negative

RATINGS RATIONALE

The move to a stable rating outlook reflects the relative stability of the Specialty Products business’ earnings and the potential for refining margins to improve. The repayment of $400 million of notes in April 2018 has improved leverage metrics. Additionally, the company has made progress in adopting its new ERP system and issued its second quarter financial statements on a timely basis.

Calumet’s Caa1 CFR reflects its modest scale, elevated leverage, improving operating performance, but historical negative free cash flow generation. The company’s Specialty Products segment generates about one-third of revenues and three-quarters of adjusted EBITDA (as reported by Calumet) and Fuel Products accounts for about two-thirds of revenues and one-quarter of EBITDA, following restructuring, which has included the sale of the Superior Wisconsin refinery and sale of the oilfield services business. Calumet is exposed to volatile raw material (crude oil) costs, which it generally can pass on to customers of specialty products, but refining profit margins remain volatile, even after the company hedges its commodity price exposures and has access to advantaged feedstocks. The company’s seven facilities have a combined throughput capacity of 140,000 barrels per day. The Fuel Products business produces transportation fuels, that can be more seasonal and cyclical than the Specialty Products earnings. The company benefits from geographic diversity of operations, a diverse customer base (no customer represents ten percent or more of revenues) and its numerous specialty products (some of which are recognized brands) offer exposure to diverse end markets. Calumet generated negative free cash flow in 2017 and the first half 2018, even after large reductions in capital spending. Its leverage (debt/EBITDA), which was 5.6x as of June 30, 2018, stepped down after the $400 million of secured notes due 2021 were repaid in April 2018 and is benefiting from ongoing year-over-year improvements in EBITDA generation. However, the leverage metrics will remain above the 4.0x level targeted by management through 2019 as a result of a lack of meaningful free cash flow generation that could be applied towards debt reduction.

Calumet’s SGL-2 Speculative Grade Liquidity rating reflects the good liquidity profile, supported by availability under the undrawn revolving $600 million ABL credit facility, operating cash flow that should cover its capital expenditures and cash on hand ($39 million as of June 30, 2018). The asset based revolver had a borrowing base of $343 million as of June 30, 2018. Moody’s expects the company will generate positive free cash flow in 2019, if working capital needs do not materially increase and it does not engage in new growth capital projects. The company does not pay distributions to unitholders, although distributions are no longer restricted following the repayment in April 2018 of the secured notes due 2021. The next debt maturity is $900 million of unsecured notes due 2021.

The revolving credit facility generally permits the company to make cash distributions to unit holders as long as immediately after giving effect to such a cash distribution, availability under the revolving credit facility totals at least the sum of the FILO loans plus the greater of: (i) 15% of the Borrowing Base; and (ii) $60 million. The revolver has one springing financial covenant which provides that only if availability under the facility falls below the sum of the FILO loans plus the greater of: (i) 10% of the Borrowing Base; and (ii) $35 million, the company is required to maintain a Fixed Charge Coverage Ratio of at least 1.0 to 1.0 as of the end of each fiscal quarter.

The senior unsecured notes are rated Caa2, one notch below the Caa1 CFR, consistent with Moody’s Loss-Given-Default Methodology, reflecting their lower priority claim on assets than borrowings under the secured revolving credit facility. Calumet’s balance sheet debt includes the secured ABL revolving credit facility and three unsecured notes issues totaling $1.575 billion.

The ratings could be upgraded if leverage (debt/EBITDA) falls below 6.0x and interest coverage remains above 1.3x on a sustained basis. The ratings could be downgraded if the company generates negative free cash flow, does not maintain an interest coverage ratio above 1.1x or liquidity declines.

The principal methodology used in these ratings was Refining and Marketing Industry published in November 2016. Please see the Rating Methodologies page on www.moodys.com for a copy of this methodology.

Calumet Specialty Products Partners, L.P., headquartered in Indianapolis, Indiana, is an independent North America producer of specialty hydrocarbon products, such as lubricants, solvents and waxes, and fuel products. It is structured as a publicly traded Master Limited Partnership (MLP). Calumet operates two business segments: Specialty Products and Fuel Products.

REGULATORY DISCLOSURES

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody’s rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider’s credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody’s legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

James Wilkins
Vice President – Senior Analyst
Corporate Finance Group
Moody’s Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

Steven Wood
MD – Corporate Finance
Corporate Finance Group
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

Releasing Office:
Moody’s Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

© 2018 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

Original Document

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Written by Greg Andrews

Investors fled Calumet Specialty Products Partners two years ago after new management took the helm of the oil refiner and manufacturer of specialty petroleum products, reversed course on an aggressive expansion that had caused debt to skyrocket, and canceled what had been a massive quarterly cash dividend.

Few investors have paid much attention since. But a prominent investment manager in New York now sees robust opportunity—thanks to a dramatic refashioning of Indianapolis-based Calumet under the new management team, led by petroleum-industry veteran Timothy Go, who joined the company in January 2016.

“Calumet is essentially in year three of a turnaround situation led by an incredible CEO who has successfully rescued the company from the jaws of insolvency,” according to a report by Bill Chen of New York-based Rhizome Partners that was recently picked up by the investing publication Barron’s.

His bullishness stems in part from the company’s newfound financial discipline and its decision to zero in on its specialty-products line—which has strong and predictable profit margins and includes such products as Royal Purple synthetic oil and Bel-Ray grease. In contrast, refining is notoriously volatile, with wild swings in profit and a host of huge competitors.

Chen said Go and his management team have “re-focused capital allocation away from mindless capital-intensive refinery acquisitions and toward branded and IP-rich products with one- to two-year payback periods.”

Before the company halted its dividend in April 2016, Calumet’s rich payout combined with its depressed stock price generated an annual dividend yield approaching 30 percent, among the highest of any U.S. public company.

Calumet shares now trade around $6.65, nearly double their October 2016 low but way down from October 2015, when they fetched around $27. Chen wrote that, as the company pays down debt, free cash flow will increase rapidly, potentially setting up the shares to rise to between $17 and $18 in the next two to five years.

Calumet maintains a low profile in Indianapolis, despite racking up $3.8 billion in revenue in 2017, ranking it as the fifth-largest public company in central Indiana. That’s because its refining and manufacturing occurs outside the Midwest, including in Louisiana, Montana and Texas.

Under Go, Calumet has cut more than $140 million in costs, sold hundreds of millions of dollars in assets, and added efficiencies in its supply chain. Its debt-reduction push included paying off $400 million in notes with an onerous 11.5 percent interest rate.

While the divestitures—including the $450 million sale of a Wisconsin refinery last year—and other restructuring steps have complicated the company’s financials, Go said on a conference call this month that the upshot is that, “after adjusting for divestments, we have now delivered seven quarters of continuous year-over-year improvement.”

Chen calls Calumet’s two parts GoodCo (specialty products) and BadCo (refining). “We will not dwell on BadCo much as it will be sold eventually,” he predicted.

On the conference call, Go insisted Calumet remains committed to fuel refining—to a point.

“We continue to look at all opportunities, whether it be on the specialty side or the fuel side—we continue to look at divestments; we continue to look at acquisitions,” Go said.

“What I would tell you is, we’re probably not going to grow in the fuels area,” he added. “We are looking to continue to grow in the specialties area. … But just because we’re not going to add more assets in the fuels business doesn’t mean that fuels business isn’t still important to Calumet.”

These actually are good times for oil refiners, thanks to strong “crack spreads”—the difference between the price of crude and the petroleum products extracted from it. Even so, specialty products drive most of Calumet’s profit. In the second quarter, the fuels business accounted for 60 percent of the company’s $946 million in sales but just 29 percent of its $123 million in profit.

The company got knocked off its game partly because of a crude oil glut, which caused the price of West Texas Intermediate to tumble from $110 a barrel in the fall of 2013 to below $30 a barrel in early 2016. It’s since risen back to about $67.

Before its 2006 initial public offering, Calumet was part of the private business empire of Indianapolis’ Fehsenfeld family, founders of the waste-management firm Heritage Environmental Services. The family, under the Heritage Group umbrella, still is the largest shareholder, with a 15 percent stake.

Original Document

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• Calumet Specialty Products (NASDAQ:CLMT) is in the midst of a turnaround led by a CEO who has rescued the company from insolvency, and units are set to surge by 130%, according to Bill Chen of Rhizome Partners.
• CLMT is essentially in year three of a turnaround situation, as new management has cut $140M of cost out of a $300M EBITDA business and “re-focused capital allocation away from mindless capital-intensive refinery acquisitions and toward branded and IP-rich products with one-to-two-year payback periods,” Chen writes.
• Chen likes CLMT’s capital structure that is ~4x debt and 2x market cap, which he says translates into a free cash flow yield of 23% that should improve as the company pays down debt.
• Cehn thinks the market will start to view CLMT as a sustainable specialty chemicals business in the long run.

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Calumet has executed well on its turnaround plan over the past two years, and looking at this stock as a viable investment isn’t the absurd idea it used to be.

Tyler Crowe (TMFDirtyBird)

After years of languishing in penny stock territory, shares of Calumet Specialty Products Partners (NASDAQ:CLMT) have had a nice run over the past year as its income statement is starting to show the results of management’s turnaround program. This past quarter, the company’s headline numbers didn’t quite show the progress we have seen in prior ones, but there are still reasons to believe that things are picking up at this specialty chemical producer and oil refiner.

Let’s take a look at Calumet’s most recent quarter to see why the less-than-stellar headline numbers are covering up some rather impressive operating results and why investors may finally want to start looking at this stock again.

When it comes to earnings at refining companies, you sometimes have to dig deep into the numbers to see how things shook out. This past quarter was a great example of that. This quarter’s headline numbers don’t look great compared to the prior year’s. Revenue, adjusted EBITDA, and distributable cash flow all declined. These metrics should be improving as the company continues to wring out costs and invest in its higher-margin specialty chemicals.

One thing that these numbers don’t show, though, was that two of Calumet’s refineries underwent significant turnaround and maintenance work this past quarter. These are routine events for refiners and will occasionally lead to an earnings hit. These maintenance activities meant that Calumet processed 36% less product compared to the prior year, and yet the company was able to post relatively similar EBITDA and net income results. That is actually a good sign. It shows that the company is significantly lowering its cost structure per processed barrel and shifting more production to high-value chemicals.

The most impressive figure in this quarterly earnings report was Calumet’s improving debt. At the end of the quarter, net debt to adjusted EBITDA was 4.9 times. Compare that to only six quarters ago when that ratio was 21.8. We should see that number decline even more in the coming quarter, as management elected to retire some of its highest-interest debt. This 11.5% interest rate loan was eating up loads of cash each year, and management estimates that it will free up about $46 million annually that was previously allocated to interest expenses.

What management had to say

When CEO Tim Go took the reins in 2016, he built a turnaround program that centered around significant cost savings, investing in small initiatives that would result in payouts in a year or less, and making niche acquisitions to expand its specialty chemical offerings. That last part seemed like a pipe dream at the time because the business was hemorrhaging money, but management has actually put itself in a position to make some targeted acquisitions. This happened this past quarter when the company made a unique investment in renewable specialty chemicals. Here’s Go explaining the deal:

Calumet has come a long way in a relatively short amount of time

Despite the slight drop in a few numbers on the income statement this past quarter, the situation at Calumet looks significantly better than it has in many years. I think if you told any investor when Go took the reins that within two years the company would have a debt-to-EBITDA ratio of 4.9 and would be consistently generating cash from operations, they would be absolutely elated.

Eliminating its high-interest debt was an incredibly important step. It will free up even more cash in the long term and allow the company to either further reduce debt, invest in other ways to expand its specialty chemical platform similar to this recent Biosynthetic Technologies acquisition, or hopefully start to pay a distribution again. After all, this is a master limited partnership.

By no means should investors consider Calumet as a safe or stable investment. The volatile nature of refining crude oil means there will always be some form of uncertainty related to future results. That said, the company has made monumental strides toward becoming a more efficient business that isn’t overburdened with an onerous debt load and underperforming assets — so much so that an investor wouldn’t be completely out of their mind considering Calumet as a potential investment. If management can continue to make the strides it has, it will make Calumet a more and more compelling business.

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