Valero also reported that its board of directors approved a 25% increase in the regular quarterly cash dividend on common stock from $0.40 per share to $0.50 per share, effective with the quarterly dividend payable on Dec. 17, 2015, to holders of record at the close of business on Nov. 23, 2015. The increase in the dividend raises the company’s annualized cash dividend to $2.00 per share.

“So far this year, we’ve invested $1.7 billion into our business, increased our dividend over 80 percent, and more than doubled our buyback total,” said Valero Chairman, President and CEO Joe Gorder. “We had solid operations and made great strides on strategic investments including the crude unit projects at Corpus Christi and Houston.”

As reported by OPIS earlier this month, Valero is expected to start up the first new crude topping unit at its 325,000-b/d Corpus Christi refinery by the end of this year, and the second similar unit at its 160,000-b/d Houston refinery will be completed sometime in the first half of 2016. Valero confirmed those expected completion dates on Wednesday.

Refining

The refining segment generated Q3 2015 operating income of $2.3 billion, up from $1.7 billion in Q3 2014. The $631 million increase primarily resulted from a $2.57 increase in throughput margin per barrel from $11.81 in Q3 2014 to $14.38 in Q3 2015, driven mainly by stronger gasoline and other product margins. Partially offsetting these factors were lower distillate margins and discounts for most sweet and sour crude oils relative to Brent crude oil.

Third quarter 2015 refining throughput volumes averaged 2.8 million b/d, which was in line with Q3 2014. Valero’s refineries operated at 96% throughput capacity utilization in the most recent quarter. The company delivered export volumes of 330,000 b/d, a record for a third quarter. Valero said the export volumes included both gasoline and diesel.

“With strong product margins and healthy demand, we delivered solid results this quarter,” Gorder said. “We are seeing good seasonal demand for our products in the fourth quarter.”

Capital Allocation

Capital spending was $467 million in Q3 2015, of which $109 million was for turnarounds and catalyst.

Valero returned a total of $1.3 billion in cash to stockholders in Q3 2015, of which $199 million was paid in dividends and $1.1 billion was used to purchase 17.2 million shares of Valero common stock. Year to date, dividends and stock buybacks totaled $2.7 billion.

Strategic Update

With the drop-down transaction that occurred on Oct. 1, 2015, Valero has completed a total of $1.14 billion of drop-down transactions to Valero Energy Partners (VLP) in 2015, exceeding its $1 billion goal for the year.

The latest drop down puts VLP on track to increase its quarterly distribution to the level needed to achieve the top tier of incentive distributions to the general partner (Valero) by early 2016. The company remains committed to growing VLP through drop-down transactions with an estimated $1 billion of potentially MLP-eligible EBITDA related to existing assets.

“We continue to fuel VLP’s growth through drop-down transactions with supportive financing arrangements that benefit both parties,” Gorder said.

Capital expenditures are expected to be within prior guidance of approximately $2.65 billion for 2015 and consistent with prior guidance for 2016 at approximately $2.4 billion. These estimates exclude the St. Charles methanol project that remains under evaluation.

Valero’s senior management will hold a conference call at 11 a.m. ET today to discuss earnings and to provide an update on company operations and strategy.