Calumet, Inc. reported significant financial challenges in its 10-Q filing for the third quarter of 2024, reflecting a stark contrast to the previous fiscal period. For the three months ended September 30, 2024, the company recorded total sales of $1,100.4 million, a decrease of 4.3% from $1,149.4 million in the same period of 2023. The decline was primarily attributed to lower sales in the Specialty Products and Solutions segment, which fell to $714.0 million from $745.7 million, despite a 9.5% increase in lubricating oils sales.

The gross profit for the third quarter plummeted to $4.9 million, down 98.1% from $261.5 million in the prior year. This decline was driven by a significant RINs expense of $30.8 million in Q3 2024, compared to a benefit of $95.8 million in Q3 2023. The Montana/Renewables segment also reported a gross loss of $20.1 million, a stark contrast to the $81.6 million profit recorded in the same quarter of 2023.

For the nine months ended September 30, 2024, total sales increased slightly to $3,239.9 million from $3,204.5 million in 2023. However, gross profit for this period decreased by 65.7% to $147.2 million, down from $429.6 million. The Specialty Products and Solutions segment saw a decrease in gross profit to $126.7 million, while the Montana/Renewables segment reported a gross loss of $49.6 million.

The company’s net loss for Q3 2024 was $(100.6) million, a significant decline from a net income of $99.8 million in Q3 2023. For the nine-month period, the net loss was $(181.3) million, compared to a net income of $96.1 million in the previous year. Basic earnings per share reflected this downturn, falling to $(1.18) for Q3 2024 from $1.24 in Q3 2023.

Strategically, Calumet completed a significant conversion transaction on July 10, 2024, merging with Calumet Specialty Products Partners, L.P., which has positioned the company as a publicly traded Delaware corporation. The company also reported a total liquidity of $289.8 million as of September 30, 2024, down from $377.6 million a year earlier, with unrestricted cash of $34.6 million.

The company’s operational performance was mixed, with production volumes for renewable fuels increasing significantly, yet facing challenges from fluctuating commodity prices and regulatory expenses related to RINs. The ongoing litigation regarding Small Refinery Exemptions (SREs) and the impact of market conditions on pricing and margins continue to pose risks to Calumet's financial stability.