Delek Us Holdings, Inc. · NYSE:DK
Delek Us — Investor Presentation (September 2021)
34 slides from Delek Us's investor presentation, Sep 7, 2021
Slide 1: Delek US Holdings, Inc. Investor Presentation
September 2021 Delek US Holdings, Inc. Investor Presentation Exhibit 99.1
Slide 2: Disclaimers
Disclaimers 2 Forward Looking Statements: Delek US Holdings, Inc. (“Delek US”) and Delek Logistics Partners, LP (“Delek Logistics”; and collectively with Delek US, “we” or “our”) are traded on the New York Stock Exchange in the United States under the symbols “DK” and ”DKL”, respectively. These slid
Slide 3: Investment Overview
3 Investment Overview (NYSE: DK) (1) Factset as of 8/16/2021 • June, 30 2021 balance sheet: • Delek US: approx. $833 million of cash; $2.2 billion of debt • Includes $2.2 million cash and $928.7 million long-term debt of DKL • Net debt (excl. DKL) of $484.8 million • Delek has established a ‘capital
Slide 4: Integrated Company with Asset Diversity and Scale
4 Asphalt 6 asphalt terminals located in: 1) El Dorado, AR 2) Muskogee, OK 3) Memphis, TN 4) Big Spring, TX 5) Henderson, TX 6) Richmond Beach, WA Refining 302,000 bpd in total El Dorado, AR Tyler, TX Big Spring, TX Krotz Springs, LA Crude oil supply: 262,000 bpd WTI linked currently I
Slide 5: Long History of Opportunistic Acquisitions & Value Creation
5 2005 Current Long History of Opportunistic Acquisitions & Value Creation Being Nimble and Capturing Market Dislocations / Opportunities 2006 Abilene & San Angelo terminals 2012 Nettleton Pipeline 2011 Paline Pipeline Acquisition Completed 171 retail fuel & convenience stores & related assets 2013
Slide 6: Environmental, Social, and Governance (ESG)
6 Environmental, Social, and Governance (ESG) Published New Sustainability Report in September 2020 Published our first demographic disclosures Total employees by gender and ethnicity Manager and above by gender Manager and above by race Added two female directors since 2019 Disclosure o
Slide 7: Sustainability Updates
7 Sustainability Updates Major milestones that will be featured in Delek’s forthcoming 2021 Sustainability Report Sustaining Capex E S G Governance: Delek observes responsible, ethical and transparent business practices. All Directors are elected annually. Our lead Director is independent. In 2020,
Slide 8: Midstream: Big Spring Gathering System
8 Midstream: Big Spring Gathering System Gathering Helps Control Crude Oil Quality and Cost into Refineries Big Spring Gathering System Approximately 200-mile gathering system 350 kbpd throughput capacity >275,000 dedicated acres Points of origin: Howard, Borden, Martin and Midland counties
Slide 9: Midstream: Wink to Webster Crude Oil Pipeline Joint Venture
9 Delek US’ Investment Delek US has a 50% ownership interest in a JV that owns a 30% ownership interest in Wink to Webster Pipeline LLC Expected $340 million to $380 million net investment Integrated with Big Spring gathering system to provide source of barrels and services to producers We
Slide 10: Enhancing Our Position In Midstream
10 Enhancing Our Position In Midstream Krotz Springs • Logistics assets associated with Krotz Springs refinery Wink to Webster Pipeline • Long haul pipeline from Permian to Gulf Coast providing stable cash flow and connected to our Big Spring Gathering system, providing access to additional crude in
Slide 11: Aligning Our Portfolio with the Most Attractive Opportunities
11 Aligning Our Portfolio with the Most Attractive Opportunities Divestitures Over $800 million in proceeds since 2016 from well-timed divestitures to enhance our portfolio composition Dropdowns Asset dropdowns to DKL have created substantial value at both DK and DKL Joint Ventures Joint ventures ha
Slide 12: Enhancing Our Retail Network
4.0x 9.0x 5.0x 12.0x NTI Build Multiple Retail Trading (TEV / NTM EBITDA) Multiple Substantial value uplift potential Low build multiple 12 Enhancing Our Retail Network • Serves as a natural fuel short while improving DK’s cash flow stability and reducing its Renewable Identification Number (“RIN”)
Slide 13: Retail: Diversifies Delek
Retail: Diversifies Delek 13 ~80% integration with existing downstream operations offering synergies and competitive advantage Operate approximately 252 C-stores in Central and West Texas and New Mexico Synergistic Retail Platform Significant Profit Growth Opportunity Rebrand 7-Eleven stores t
Slide 14: Renewables: Renewable Diesel
Renewables: Renewable Diesel 14 Delek has established a ‘capital light’ approach to Renewable Diesel $13.3 million option for 33% indirect interest in the net cash flow from a renewable diesel facility following its conversion The facility will be able to produce up to 220mm gallons a year of
Slide 15: Positioning for Energy Transition
15 Positioning for Energy Transition Existing footprint in biodiesel and reviewing opportunities in renewable diesel and de-carbonization Operate 3 Biodiesel Facilities: ~40mm gallons of annual biodiesel production capacity (equal to 407,200 metric tons of carbon reduction)(1) Crossett, AR New Alban
Slide 16: Refining Assets and Crude Slate
87% 13% Tyler(1) WTI ETX Other (1) Crude oil slate based on amount received three months-ended as of June 30, 2021 and will vary each period based on operations and purchases. Note: WTI-Brent differential realized through crack spread and capture rates and Midland-WTI differential realized in crude
Slide 17: Long-term Capital Allocation Framework
17 Long-term Capital Allocation Framework Four pillars underpinned by a rigorous and disciplined capital allocation program to create long-term value Priorities: • Invest: Capital allocation program focuses on safety, maintenance, and reliability as top priority • Cash Returns: Maintain a competitiv
Slide 18: Capital Allocation – Balanced & Flexible
Capital Allocation – Balanced & Flexible 18 $0 $100 $200 $300 $400 $500 CAPEX CAPEX 2019-2021 2019 2020 2021E 2021E 25% lower than 2020 • 2021 spending guidance of $175 to $185 million (including turnarounds) • Net of estimated insurance proceeds • 2021 includes the following projects: • Krotz Sprin
Slide 19: Capital Allocation Discipline
$65.8 $78.3 $170.3 $13.3 $1.5 $22.9 $59.5 $63.4 $44.7 $25.0 $19.9 $1.7 $3.2 $8.7 $7.5 $2.3 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 Sustaining Capex Discretionary Capex 19 Capital Allocation Discipline $1,000 $950 $781 $833 $802 $784 $781 $831 $159 $284 $496 $627 $666 $573 $604 $485 3Q19 4Q19 1Q20 2Q
Slide 20: Market Opportunities & Valuation
Market Opportunities & Valuation
Slide 21: Refining system product yields versus peers
41% 39% 39% 37% 35% 35% 33% 37% CVI PSX DK VLO HFC MPC PBF 2Q21 Refiners’ Middle Distillates Yield % (1) (2) (3) 54% 53% 51% 51% 49% 47% 47% 50% HFC CVI MPC VLO DK PSX PBF 2Q21 Refiners’ Gasoline Yield % (1) (3) 21 Refining system product yields Strong middle distillate yield versus peers Abil
Slide 22: Tangible Assets with Underlying Value
Tangible Assets with Underlying Value Four refineries with 302mbbl/d of aggregate capacity 80% DKL ownership provides public marker of value DK owns 34.7mm units at $38.86 or $1.4 billion (1) Retail value supported strong valuations for retail businesses ’23E EBITDA of $50mm; retail busine
Slide 23: Path Forward
Path Forward Potential Small Refiner Exemptions Expected Insurance Proceeds Tax Refund Received Potential Cash Inflows 23
Slide 24: Summary
Growing Midstream Platform to Diversify EBITDA Stream Financial Flexibility to Support Strategic Objectives An Integrated and Diversified Refining, Logistics and Retail Company Invest in the Business to Operate Reliably and Safely Permian Focused Refining System with Increasing Access to Cushing Foc
Slide 25: Appendix
Appendix
Slide 26: 2Q21 Cash Flows
2Q21 Cash Flows * — Strong financial position with $833 million of cash on she baldite sheet sum Total Consolidated Cash Flows Cash flow from operating activities of approx. = $794 am =a $233 $169 million soo = Ly ical Le * Cash flow from operating activities (excluding seoo = ba working capital) of
Slide 27: 2021 Guidance Range
2021 Guidance Range 3Q21 Guidance Range ($ in millions) Consolidated Operating Expenses Consolidated G&A Consolidated Depreciation and Amort. Net interest expense Total Crude Throughput
Slide 28: Summary Organizational Structure
28 Summary Organizational Structure 20% interest (8.7 million units) Limited partner-common 100% Delek Logistics Partners, LP NYSE: DKL (the Partnership) Public Unitholders Operating Subsidiaries 80% interest (34.7 million units) Limited partner-common Delek Logistics GP, LLC (the General Partner) D
Slide 29: DKL Distribution Coverage
1.39x 1.32x 1.35x 1.30x 1.61x 2.02x 1.42x 1.67x 1.25x 1.49x 1.47x 1.18x 1.20x 1.29x 0.98x 1.00x 0.88x 1.06x 0.97x 0.96x 1.14x 1.34x 1.25x 1.03x 1.06x 1.08x 1.11x 1.08x 1.15x 1.58x 1.50x 1.41x 1.31x 1.32x 1Q132Q133Q134Q131Q142Q143Q144Q141Q152Q153Q154Q151Q162Q163Q164Q161Q172Q173Q174Q171Q182Q183Q184Q18
Slide 30: Reconciliations
Reconciliations
Slide 31: DKL: Income Statement and Non-GAAP EBITDA Reconciliation
31 1) Results in 2013 and 2014 are as reported excluding predecessor costs related to the dropdown of the tank farms and product terminals at both Tyler and El Dorado during the respective periods. 2) Results for 1Q15 are as reported excluding predecessor costs related to the 1Q15 dropdowns. Note: M
Slide 32: Net Debt Reconciliation
32 Net Debt Reconciliation (1) Numbers may not foot due to rounding ($ in millions) 3Q-19 4Q-19 1Q-20 2Q-20 3Q-20 4Q-20 1Q-21 2Q-21 Current Portion of Long-Term Debt $65 $36 $31 $33 $33 $33 $13 $46 Long-Term Debt $1,935 $2,031 $2,186 $2,422 $2,441 $2,315 $2,354 $2,198 Total Debt $2,000 $2,067 $2,217
Slide 33: Adjusted Retail Segment Earnings Reconciliation
33 (1) For the annual period ended December 31, 2016, the Pre-acquisition Alon Adjusted Retail Segment Earnings was derived from the Annual Report on Form 10-K filed by Alon and incorporated by reference into Delek’s 2016 Annual Report on Form 10-K, and for the six months ended June 30, 2017, the Pr
Slide 34: Investor Relations Contacts
Investor Relations Contacts: Blake Fernandez, SVP IR/Market Intelligence 615-224-1312 Kaley Weinstein, Investor Relations Analyst 267-701-0111
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