Cvr Energy Inc. · NYSE:CVI
Cvr Energy — Investor Presentation (May 2022)
31 slides from Cvr Energy's investor presentation, May 18, 2022
Slide 1: Investor Presentation May 2022
Investor Presentation May 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains f orward-looking statements (“FLS”) which are protected as FLS under the PSLRA, and which are based on management’s current expectations and belief s, as well as a number of assumptions concerning f uture ev ents. The assumptions and estimates un
Slide 3: Mission and Values
Mission and Values Safety - We always put safety first. The protection of our employees, contractors and communities is paramount. We have an unwavering commitment to safety above all else. If it’s not safe, then we don’t do it. Environment - We care for our environment. Complying with all regulatio
Slide 4: Company Overview
Petroleum Segment Fertilizer Segment Company Overview CVR Energy is a diversified holding company primarily engaged in the petroleum refining and nitrogen fertilizer manufacturing industries, with an increasing focus on the production of renewable biofuels. CVR Energy’s Petroleum segment is comprise
Slide 5: Continuing to improve in all EH&S matters – Safety is Job #1
Continuing to improve in all Environmental, Health and Safety matters – Safety is Job #1 Petroleum Segment had no recordable incidents in 1Q 2022, representing a 100% reduction from 1.7 in 1Q 2021. Fertilizer segment had no process safety incidents or recordable incidents and achieved a 50% reductio
Slide 6: Capital Allocation Strategy
Capital Allocation Strategy Non-Discretionary Asset Continuity Safety, reliability and environmental compliance are core to CVR’s management philosophy • Approximately $100MM in annual sustaining and regulatory capex, allocated to assets through a continuous assessment process. • Run-rate annual ref
Slide 7: ESG Highlights
GovernanceSocial Environmental ESG Highlights o Renewable diesel unit start-up at the Wynnewood Refinery in April 2022. o Wynnewood Refinery feedstock pretreater construction & installation expected to be in the second quarter of 2023. o Board approved process design study for the potential conversi
Slide 8: Petroleum Segment
PETROLEUM SEGMENT
Slide 9: Asset Footprint
Asset Footprint 8 Mid-Continent Refineries Nameplate crude oil capacity of 206,500 bpd across two refineries • 1Q 2022 total throughput of 197,344 bpd, impacted by the planned turnaround at Wynnewood • FY 2021 total throughput of 209,084 bpd Average complexity of 10.8 Located in Group 3 of PADD II C
Slide 10: Strategically Located Mid-Con Refineries
Strategically Located Mid-Con Refineries 9 Marketing Network Optionality ➢ Marketing activities focused in central mid-continent area via rack marketing, supplying nearby customers and at terminals on third-party distribution systems. ➢ Rack marketing enables the sale of blended products, allowing C
Slide 11: High-Quality Refining Assets
Gasoline 53% Distillate 41% Other (5) 6% Regional Crude 41% Cushing WTI 29% Condensate 8% Midland WTI, WTL & WTS 3% Heavy Canadian (3) 3% Other (4) 16% High-Quality Refining Assets Consolidated High Utilization Rates Total Throughput and Production Mix(1) Consolidated Top Tier Refining Margin (1) Co
Slide 12: Constructive Macro Environment
Constructive Macro Environment 11Source: EIA, Magellan US Gasoline Demand Magellan System Gasoline Demand US Diesel Demand Magellan System Diesel Demand
Slide 13: Constructive Macro Environment
Constructive Macro Environment 12Source: EIA, Magellan US Gasoline Inventories Magellan System Gasoline Inventories US Diesel Inventories Magellan System Diesel Inventories
Slide 14: Constructive Macro Environment
Constructive Macro Environment 13 (1) Assumes high-end of proposed 2021 and 2022 Renewable Volume Obligations (2) 2Q 2022 represents QTD pricing through May 10, 2022 Source: MarketView as of May 10, 2022 2-1-1 Crack Spreads & Brent-WTI Differentials ($/bbl) Midland-Cushing and WTL-WTI Differentials
Slide 15: Renewable Diesel Initiatives
• Contemplates construction of a feed pre-treater at Wynnewood that would enable processing of inedible corn oil, animal fats and used cooking oils that generate additional LCFS credits. • Currently plan to complete construction and installation by 2Q 2023. • Board has approved the completion of pro
Slide 16: Renewable Diesel Initiatives
Renewable Diesel Initiatives 15 KSAAT Project at Wynnewood Wynnewood Hydrocracker Conversion(1) Project Highlights: • Converted 19,000 BPD hydrocracker at Wynnewood to process 100 million gallons per year of washed and bleached soybean oil or pre-treated corn oil to produce renewable diesel and rene
Slide 17: Renewable Diesel Initiatives: KSAAT Project at Wynnewood
Renewable Diesel Initiatives 16 KSAAT Project at Wynnewood • Renewable diesel margins impacted by several factors: • Crude oil price and spread between ULSD and Soybean oil (HOBO spread) • RINs prices (1.7 D4 Biodiesel RINs generated per gallon of renewable diesel produced) • BTC ($1/gal credit auth
Slide 18: Capital Expenditures and Turnarounds
$0 $50 $100 $150 $200 $250 2017 2018 2019 2020 2021 2022e $ M Environmental & Maintenance Growth Capital Expenditures and Turnarounds 17Note: As of March 31, 2022. Shaded areas indicate the top end of capital expenditure estimates. 2022 Petroleum Segment and RDU Capex of $164M - $188M Environmental
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Slide 20: Stable Trends in Fertilizer Supply & Demand
19 Stable Trends in Fertilizer Supply & Demand Source: USDA, Fertecon US Nitrogen SupplyCorn Stocks to Use ➢ Fertilizers typically represent approximately 15% of farmers’ cost structure and significantly improve yields. ➢ USDA projecting stocks to use ratio for 2021/2022 at approximately 10%, one of
Slide 21: ➢ Hurricane activity caused the shutdown of several US production facilities for several weeks,
➢ Hurricane activity caused the shutdown of several US production facilities for several weeks, further tightening supply. ➢ Favorable dry fall weather conditions led to an early corn harvest and extended timeframe for ammonia application. ➢ European production curtailments due to spike in natural g
Slide 22: Strong Demand for Corn in the U.S.
Strong Demand for Corn in the U.S. ➢ Corn has a variety of uses and applications, including feed grains, ethanol for fuel and food, seed and industrial (FSI). ➢ Feed grains ▪ ~96% of domestic feed grains are supplied by corn. ▪ Consumes ~39% of annual corn crop.(1) ➢ Ethanol ▪ Consumes ~37% of annua
Slide 23: Strategically Located Assets
22 Strategically Located Assets ➢ Large geographic footprint serving the Southern Plains and Corn Belt region. ➢ Well positioned to minimize distribution costs and maximize net back pricing. ➢ Rail loading rack at Coffeyville provides significant logistics optionality west of the Mississippi River d
Slide 24: Key Operating Statistics
Key Operating Statistics Consolidated Production Volumes(1) Consolidated Ammonia Utilization(2) Consolidated Feedstock Costs(1) Consolidated Sales Revenue(1)(3) (1) For the last twelve months ended March 31, 2022. (2) Adjusted for planned turnarounds. (3) Excludes freight and other. 23 UAN 67% Ammon
Slide 25: Capital Expenditures and Turnaround Expenses
Capital Expenditures and Turnaround Expenses 24 2022 Total Capex budget of $38M - $42M Environmental and Maintenance spending estimated at $36M - $39M. Growth capex estimated at $2M - $3M. 2022 Turnaround spending estimated at $26M - $31M ➢ Coffeyville and East Dubuque planned turnarounds are schedu
Slide 26: Appendix
APPENDIX
Slide 27: Non-GAAP Financial Measures
Non-GAAP Financial Measures 26 Adjusted EBITDA –EBITDA adjusted for certain significant non-cash items and items that management believes are not attributable to or indicative of our on-going operations or that may obscure our underlying results and trends. Direct Operating Expenses per Throughput B
Slide 28: Non-GAAP Financial Measures
Non-GAAP Financial Measures 27Note: All amounts on this slide are adjusted for the turnaround accounting change effective in 1Q 2019. These amounts are unaudited. Petroleum Segment (In USD Millions) CVR Energy, Inc. 2017 2018 2019 2020 2021 2Q 2021 3Q 2021 4Q 2021 1Q 2022 TTM Net Income 258$ 366$ 36
Slide 29: Non-GAAP Financial Measures
Non-GAAP Financial Measures 28 (In USD Millions) CVR Partners, LP 2017 2018 2019 2020 2021 2Q 2021 3Q 2021 4Q 2021 1Q 2022 TTM Net Income (loss) (73)$ (50)$ (35)$ (98)$ 78$ 7$ 35$ 61$ 94$ 197$ Add: Interest expense and other financing costs, net of interest income 63 62 62 63 61$ 23 11 11 10 55 Add:
Slide 30: 2022 Estimated Capital Expenditures
2022 Estimated Capital Expenditures 29 (1) Total 2022 estimated capitalized costs include approximately $48 million of growth related projects that will require additional approvals before commencement. (2) Renewables reflects spending on the Wynnewood Refinery RDU and pretreater projects, as well a
Slide 31: Simplified Organizational Structure
Simplified Organizational Structure 30 Public 29% 71% Public 34.1% 65.9% 63.2% 36.8% Non-Economic General Partner Interest Non-Economic General Partner Interest 50% 40% Midway Pipeline, LLC New Entities for Renewables Restructuring Enable South Central Pipeline, LLC Nitrogen Fertilizer Segment Icahn