Thursday, Valero Energy Corp. (VLO) reported, in its restated third quarter results, that the company's loss widened as it has recorded a significant loss contingency accrual which was not recognized in the third quarter results released on October 27, 2009. The contingency accrual is related to a dispute on certain issues between Valero and the Government of Aruba.
Even though an arbitration panel in the Netherlands handed down an interim decision favorably on Valero's existing exemption from income tax liability for refining operations through 2010, the panel has not made decision on two other items in the arbitration - the applicable dividend tax rate and the turnover tax - and remain subject to further review. Due to the uncertain timing of the panel's final ruling, the company decided to record a loss contingency accrual of approximately $140 million, or $0.25 per share, in its financial results for the quarter ended September 30. The accrual includes all material liabilities through September 30, 2009 associated with the arbitration.
The San-Antonio, Texas-based company updated its third quarter results and reported a loss of $629 million or $1.12 per share, compared with a profit of $1.15 billion or $2.18 per share in the comparable period a year-ago.
On average, 14 analysts polled by Thomson Reuters estimated a loss of $0.42 per share. Analysts' estimates typically exclude special items.
Before the restatement, the third-quarter net loss reported by the company was $489 million or $0.87 per share.
Operating revenues for the quarter declined to $19.5 billion from $35.9 billion year-ago. Four Wall Street analysts estimated revenues of $18.92 billion for the quarter.
Special items in the latest quarter included an asset impairment loss of $417 million before taxes, or $0.48 per share after taxes, related primarily to the permanent shutdown of the gasifier complex at the company's Delaware City refinery. The third quarter 2008 special items included a gain of $305 million on the sale of the Krotz Springs, Louisiana refinery and $43 million of asset impairment losses before taxes, which together amount to $0.27 per share after taxes.
Operating loss for the third quarter was $693 million, compared with operating income of $1.84 billion in the year-ago period.
Total costs and expenses for the quarter declined to $20.18 billion from $34.12 billion year-ago.
Year-to-date, net loss was $574 million or $1.08 per share, compared with a profit of $2.14 billion or $4.02 per share year-ago. Earlier, the company reported nine-month net loss of $434 million or $0.81 per share.
Operating revenues for the nine-month period declined to $51.23 billion from $100.54 billion in the year-ago period.
VLO closed Thursday's regular trade at $17.72, up 2 cents. In late trading, the stock gained another 7 cents.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.