Cvr Partners, Lp · NYSE:UAN
Cvr Partners, Lp — Investor Presentation (May 2013)
23 slides from Cvr Partners, Lp's investor presentation, May 31, 2013
Slide 1: Investor Presentation May 2013
Investor Presentation May 2013
Slide 2: Safe Harbor
2 Safe Harbor The following information contains forward-looking statements based on management’s current expectations and beliefs, as well as a number of assumptions concerning future events. These statements are subject to risks, uncertainties, assumptions and other important factors. You are caut
Slide 3: Key Strategic Drivers
3 Key Strategic Drivers Solid market fundamentals Experienced management team Fully utilized capacity High run time rates Strategically located assets Multiple opportunities for growth Growth-oriented partnership formed by CVR Energy, Inc. in June 2007 . . . IPO in April 2011 General Partner has non
Slide 4: Solid Market Fundamentals: Key Demand Drivers
4 Solid Market Fundamentals Key Demand Drivers
Slide 5: Consistent Fertilizer Demand Growth
5 Solid Market Fundamentals Consistent Fertilizer Demand Growth Nitrogen represents ~62% of fertilizer consumption(1) Nitrogen fertilizers have the most stable demand because must be applied annually Primary determinant of crop yield (1) Per the International Fertilizer Industry Association. Nitroge
Slide 6: Farmer Profitability Supports Fertilizer Price
6 Solid Market Fundamentals Farmer Profitability Supports Fertilizer Price Corn consumes the largest amount of nitrogen fertilizer Farmers are expected to generate substantial proceeds at currently forecasted corn prices Farmer incentivized to use nitrogen at corn price much lower than current spot
Slide 7: Supply/Demand Supports Significant Planting
7 Solid Market Fundamentals Supply/Demand Supports Significant Planting Millions of Acres Bushels per Acre U.S. Corn Planted & Yields Source: USDA. 000’s of Nitrogen Tons U.S. Nitrogen Production & Consumption Source: Fertecon. (1) Excludes recently announced or other potential significant capacity
Slide 8: Acres Planted Impacts Crop Yield
8 Solid Market Fundamentals Acres Planted Impacts Crop Yield Historical Yield Data Indicates Year Ending Corn Stocks of 10% or Less Millions of metric tons (unless otherwise noted) 2012 2013 2013 (Assuming 95 MM Acres Planted) 90 MM Greater 90 MM Greater acres 90 MM acres 90 MM USDA (1) USDA (1) or
Slide 9: Excess Demand Driving Imports of UAN
9 Solid Market Fundamentals Excess Demand Driving Imports of UAN Country 2008 2009 2010 2011 2012 Trinidad & Tobago 0 0 777 1,010 852 Russia 953 658 749 674 750 Canada 487 427 437 617 402 Romania 185 29 254 487 284 Egypt 174 0 123 117 221 Lithuania 431 69 79 489 395 Ukraine 173 0 73 30 0 Poland 123
Slide 10: Experienced Management Team
SVP, General Counsel & Secretary EVP Business Development VP Environmental, Health & Safety
Slide 11: Fully Utilized Capacity & High Run Rates
11 Fully Utilized Capacity & High Run Rates (1) Excludes impact of major scheduled turnaround (occurs every two years) and third party air separation unit outage. Including impact of turnaround and third party outage, on-stream efficiency would have been 92.6% for gasifier, 91.1% for ammonia, and 86
Slide 12: Strategically Located Assets
Strategically Located Assets Located in Corn Belt 54% of corn planted in 2012 was within $45/UAN ton freight rate of plant ~$15/UAN ton transportation advantage to Corn Belt vs. U.S. Gulf Coast 12 * * Impacted by major scheduled turnaround (occurs every two years).
Slide 13: Multiple Growth Opportunities
13 Multiple Growth Opportunities Current 12-24 Months 3-5 Years Operational efficiency Plant expand/enhance Specialty products Distribution Mergers and acquisitions
Slide 14: UAN Plant Expansion Completed in March 2013
14 UAN Plant Expansion Completed in March 2013 Overview Increased exposure to strong UAN market dynamics Ability to upgrade 100% of ammonia to UAN Expanded UAN capacity by ~400K tons/year (~50%) to ~1MM tons/year Total cost of $130MM Annualized incremental impact EBITDA: ~$18MM Available for distrib
Slide 15: History of Financial Success
See page 22 for a reconciliation of net income to EBITDA. See page 22 for a reconciliation of net income to EBITDA less maintenance capital. 15 History of Financial Success EBITDA Capital Expenditures Maintenance Growth/Expansion 1) Plant gate (netback) price per ton represents net sales less freigh
Slide 16: Significant Growth in 2013 YTD
16 Significant Growth in 2013 YTD 3/31/13 YTD 3/31/12 Change Sales $81.4 $78.3 4.0% EBITDA(1) $42.6 $36.8 15.8% Adjusted EBITDA(2) $43.8 $38.0 15.3% Operating Income $36.8 $31.4 17.2% Distributable Cash Flow (DCF) $44.6 $38.2 16.8% DCF/Unit $0.610 $0.523 16.6% $US millions, except per unit data See
Slide 17: Strong Financial Profile
17 Strong Financial Profile ($US millions) Capitalization As of 3/31/13 Cash & Equivalents $153.2 Credit Facility due April 2016: Term Loan 125.0 $25 million Revolver - Total Debt $125.0 Partners' Equity 469.1 Total Capitalization (Book) $594.1 LTM EBITDA(1) $142.4 LTM Interest Expense(1) 3.8 Key Cr
Slide 18: A Bright Outlook
18 A Bright Outlook Strong industry fundamentals High-quality & strategically-located assets Premium product focus Attractive growth opportunities Experienced management team Pay out 100% of available cash each quarter No IDRs or management fees for General Partner
Slide 19: Maximizing Yields
Maximizing Yields
Slide 20: Fertilizer Plant Schematic
20 Fertilizer Plant Schematic Fluxant (fly ash & sand)
Slide 21: Non-GAAP Financial Measures
21 Non-GAAP Financial Measures To supplement the actual results in accordance with U.S. generally accepted accounting principles (GAAP), for the applicable periods, the Company also uses certain non-GAAP financial measures as discussed below, which are adjusted for GAAP-based results. The use of non
Slide 22: Non-GAAP Reconciliation
22 Non-GAAP Reconciliation EBITDA: Defined as net income before (i) net interest (income) expense; (ii) income tax expense; and (iii) depreciation and amortization expense, which are items management believes affect the comparability of operating results. See below for reconciliation of net income t
Slide 23: Activities & Transactions
23 Activities & Transactions January-March April-June July-September October-December Season Dealer/Distributor Fill Orders & Wheat Topdress Spring Planting Dealer/Distributor Fill Orders Dealer/Distributor Fill Orders & Fall Planting Crop No Planting Corn Planting No Planting Wheat Planting Nirtrog