Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - FRONTIER OIL CORP /NEW/ | form8k.htm |
| EX-99.1 - EXHIBIT 99.1 - FRONTIER OIL CORP /NEW/ | ex99-1.htm |
Exhibit 99.2
NEWS
RELEASE
2009-13
FOR
IMMEDIATE RELEASE
Contact: Kristine
Boyd
(713)
688-9600 x135
FRONTIER
OIL ANNOUNCES CHANGE TO LIFO INVENTORY VALUATION METHOD AND DECLARATION OF
QUARTERLY DIVIDEND
HOUSTON,
TEXAS, November 18, 2009 – Frontier Oil Corporation (NYSE: FTO) today announced
its intention to change its inventory valuation method to the last-in, first-out
(LIFO) method from the first-in, first-out (FIFO) method effective with the
filing of the Company’s 10-K for the fiscal year ended December 31,
2009. The inventory valuation change will decrease Frontier’s
reported pre-tax income for the nine months ended September 30, 2009 by
approximately $180 million. As a result of lower pre-tax income, the
Company believes it will recognize cash tax savings in excess of $60 million for
the nine months ended September 30, 2009.
Frontier
also announced today that its Board of Directors declared a regular quarterly
cash dividend on the Company’s common stock of $0.06 per share. The
dividend is payable January 13, 2010 to shareholders of record as of the close
of business on December 30, 2009.
Based on
current market conditions and after giving effect to the change in inventory
valuation methods, the Company anticipates being contractually unable to pay
cash dividends under the restricted payments provision of the Company’s senior
notes indentures upon filing of its 10-K for the year ended December 31,
2009.
Frontier’s
President & CEO, Mike Jennings, commented, “Our conversion to LIFO
represents both a significant cash tax savings to the Company and improved
comparability to our refining peer group, almost all of whom report on a LIFO
basis. Despite our meaningful cash balance, our low profitability
this year will likely restrict our ability to pay cash dividends beyond the
quarterly distribution declared today. While we regret that a
dividend suspension is a possibility, we believe our shareholders are better
served by the cash tax savings that will result from our conversion to
LIFO.”
Conference
Call
A
conference call is scheduled for today, November 18, 2009, at 4:00 p.m. central
time to discuss these changes. To access the call, which is open to
the public, please dial (800) 447-0521 (international callers (847) 413-3238),
confirmation number 25874352. A recorded replay of the call may be
heard through December 2, 2009 by dialing (888) 843-8996 (international callers
(630) 652-3044), passcode 25874352. In addition, the real-time
conference call and a recorded replay will be available via webcast by
registering from the Investor Relations page of our website www.frontieroil.com.
Frontier
operates a 130,000 bpd refinery located in El Dorado, Kansas, and a 52,000 bpd
refinery located in Cheyenne, Wyoming, and markets its refined products
principally along the eastern slope of the Rocky Mountains and in other
neighboring plains states. Information about the Company may be found
on its website www.frontieroil.com.
This
press release includes “forward-looking statements” as defined by the Securities
and Exchange Commission. Such statements are those concerning strategic plans,
expectations and objectives for future operations. All statements, other than
statements of historical fact, included in this press release that address
activities, events or developments that the Company expects, believes or
anticipates will or may occur in the future are forward-looking
statements. These statements are based on certain assumptions made by
the Company based on its experience and perception of historical trends, current
conditions, expected future developments and other factors it believes are
appropriate in the circumstances. Such statements are subject to a number of
assumptions, risks and uncertainties, many of which are beyond the control of
the Company. Investors are cautioned that any such statements are not
guarantees of future performance and that actual results or developments may
differ materially from those projected in the forward-looking
statements.