said Tuesday that its net income jumped 16% in the second quarter of 2007.
San Antonio-based Valero earned $2.2 billion in the quarter, or $3.89 a share, up from $1.9 billion, or $2.98 a share, one year earlier. The results beat out the $3.76 estimate, according to a Thomson Financial analyst survey.
High refining margins and strong demand for petroleum products like gasoline were responsible for the improved results, said CEO Bill Klesse, in a press statement.
"Gulf Coast gasoline margins averaged nearly $29 per barrel, which is 45% higher than in the second quarter of last year," Klesse said. "We are in a great refining environment."
He admitted that refining margins have recently fallen from their springtime best, but he said that crack spreads for refined products are still high in a historical context.
The company generated revenue of $24.2 billion, down 5.7% from the $25.6 billion it generated a year ago.
Rising costs were partially offset by higher throughput, according to CFO Mike Ciskowski. Valero spent $592 million on capital spending in the quarter, $101 million of which went toward refinery turnarounds.
Shares of Valero were recently trading 1.4% lower at $68.12.