PBF Expects to Cut Interest Expense by $130 Million in 2027 After Debt Repayment
Key Facts
PBF Energy management expects refinancing and debt repayments carried out during 2026 to reduce interest expense by at least $130 million in 2027, according to its third-quarter earnings call. The figure remains management’s estimate, as it was still preparing its 2027 budget at the time of the call. The outlook follows a series of debt repayments and refinancing transactions, including the issuance of zero-interest exchangeable notes during the third quarter. The company said it used the proceeds, along with cash, to repay outstanding notes. It also reduced net debt by more than $1.2 billion during the quarter, according to its disclosure.
PBF issued $550 million of 0% exchangeable notes due in 2032 and used the proceeds, along with cash, to repay in full $500 million of 7.875% unsecured notes due in 2030. After the quarter ended, the company also repaid in full $800 million of 9.875% unsecured notes due in 2030, using available cash. Cash stood at about $2.5 billion at the end of the third quarter, compared with total debt of about $2.1 billion. Net cash was $426 million at that date. Chief Executive Matt Lucey said net debt reduction had exceeded $2 billion from the start of 2026 through the end of the third quarter.
The company reported operating income of $2,100.9 million in the third quarter of 2026, compared with $285.9 million in the same period of 2025. Net income attributable to PBF shareholders was about $1,529.3 million, or $12.54 per share, versus $170.1 million, or $1.45 per share, a year earlier. Management attributed the strong results to tight refined-product markets. It said more than 5 million barrels per day of global capacity was offline and global inventories were about 500 million barrels below pre-war levels. The New York Harbor benchmark crack spread averaged about $65 per barrel in the third quarter, versus about $26 a year earlier.
Operationally, average refinery production across the company’s system was about 924,000 barrels per day in the third quarter. Management expects total production to range between 925,000 and 985,000 barrels per day in the fourth quarter of 2026. At the St. Bernard renewable diesel project, average production was 19,156 barrels per day in the third quarter, while the company expects an average of between 18,000 and 20,000 barrels per day in the fourth quarter. PBF moved planned fourth-quarter maintenance at its Chalmette and Toledo refineries to 2027. It maintained its 2026 capital spending guidance at $825 million to $875 million, excluding Martinez rebuild costs.
The company said its refinery business improvement program delivered more than $230 million in cost improvements on an annualized basis in 2025. It expects total improvements to exceed $350 million by the end of 2026. On the call, the chief executive described the refining sector as having entered “a new higher cycle characterized by greater volatility and a tendency toward wider crude oil price differentials.” Management expects the 2027 maintenance schedule to be heavier than usual after maintenance work was rescheduled, with 2028 set to be a lighter year. PBF also declared a quarterly dividend of $0.325 per share, payable on November 24, 2026, to shareholders of record on November 12. The stock closed at $73.28 on October 28, then early trading on October 29 showed a price of $73.40, up 0.16% from the previous close.