Calumet Inc.

Calumet reported $175 million of adjusted EBITDA with tax attributes in Q2 2026. Specialty Products & Solutions contributed $161.7 million of adjusted EBITDA, up more than 100% versus the prior year, while Performance Brands delivered $6.3 million of adjusted EBITDA, down about $6.2 million year over year. Montana Renewables generated $17 million of adjusted EBITDA with tax attributes despite more than $40 million of foregone margin from downtime, and Refining/CMR generated $12.2 million of adjusted EBITDA, up about $10.9 million sequentially. The company also said it drove over $90 million of cash flow from operations, built $70 million of working capital, and saw restricted group leverage fall below 4x. Looking ahead, management expects to surpass 3x leverage next quarter, sees a strong second half in specialties, expects Q3 results at Montana Renewables to be meaningfully higher on a full quarter of production, and said the next phase of the SAF project should allow roughly 60 million gallons of SAF run-rate initially, then 80 million to 100 million by year-end, 120 million to 150 million by spring 2027, and ultimately 200 million gallons by 2028.

Todd Borgmann framed the quarter as proof that Calumet is becoming a self-funding, deleveraging platform with multiple businesses benefiting from strong market conditions. He emphasized that the company is now looking at growth projects in parallel with debt reduction, and that the Montana Renewables expansion is being redesigned into a much cheaper and lower-risk project than originally planned. His tone was upbeat and confident, with repeated comments that the market setup is structurally favorable and that Calumet is on the right side of it.

David Lunin highlighted the $175 million of adjusted EBITDA with tax attributes, over $90 million of operating cash flow, and $70 million of working capital build, which he said was mostly timing-related and should unwind. He pointed to about $20 million of fuel hedge impact, said roughly 20% of fuel production is hedged through early 2028, and noted 2027 hedge levels at approximately $28 per barrel on a CBOB basis. He also said the company called $100 million of 2028 MIRA notes and retired the $115 million CMR truck rack sale-leaseback, and that those actions, together with strong business performance, support continued accelerated deleveraging.

Analysts pressed management on whether the elevated base oil market is durable and how much of the margin is simply feedstock pass-through. Scott Obermeier said the market is tight for structural reasons, including outages from the Iran war, European and Russian disruptions, and refinery diversion toward distillates, and he expects that to continue through 2026. Questions also focused on Montana Renewables monetization and the SAF ramp; management said MRL monetization remains a long-term option, but it is now about shareholder value optimization rather than being required to fund specialties growth. On the SAF project, management said the current plan is intentionally more capital-efficient, with the second reactor enabling best-in-class yields, and explained that it is keeping CMR running for now to capture about $50 million of additional EBITDA before reconfiguration.