Cvr Energy Inc. · NYSE:CVI
Cvr Energy — Investor Presentation (January 2024)
31 slides from Cvr Energy's investor presentation, Jan 2, 2024
Slide 1: Investor Presentation January 2024
Investor Presentation January 2024
Slide 2: Forward-looking statements
This presentation contains forward-looking statements (“FLS”) which are protected as FLS under the PSLRA, and which are based on management’s current expectations and beliefs, as well as a number of assumptions concerning future events. The assumptions and estimates underlying FLS are inherently unc
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
Company Overview Petroleum Segment: ▪ Two strategically located Mid-Continent refineries close to Cushing, Oklahoma. Total nameplate capacity 206,500 bpd. ▪ Direct access to crude oil and condensate fields in the Anadarko and Arkoma Basins. ▪ Complementary logistics assets and access to multiple key
Slide 5: Strategic Priorities
Strategic Priorities Focus on EH&S Performance Preserve Cash Flow Maintain Balance Sheet & Liquidity Focus on Crude Oil Quality & Differentials Grow our Renewables Business Maximize Returns to Investors Focusing on improvements in Environmental, Health and Safety Maters – Safety is Job #1 Consolidat
Slide 6: Capital Allocation Strategy
Capital Allocation Strategy 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 refining turnaround investment of $75M
Slide 7: Governance, Social and Environmental
Governance ▪ Board-level ESG oversight. ▪ Annual Code of Ethics & Business Conduct Acknowledgement for all employees and directors. ▪ Average tenure of CVR Energy and CVR Partners Directors is less than ten years. ▪ Standing EH&S Committee chaired by independent Director and former Assistant Adminis
Slide 8: Petroleum Segment
PETROLEUM SEGMENT
Slide 9: Asset Footprint
Asset Footprint 8 Nameplate crude oil capacity of 206,500 bpd across two refineries ▪ 3Q 2023 total throughput of 212,420 bpd ▪ FY 2022 total throughput of 205,288 bpd; Crude oil capacity utilization of approximately 92% Average complexity of 10.8 Located in Group 3 of PADD II ▪ Refineries are strat
Slide 10: Strategically Located Mid-Con Refineries, Multiple Product Sales Outlets
Strategically Located Mid-Con Refineries Multiple Product Sales Outlets Focused on maximizing refined product netbacks and participating in renewable fuel blending economics and internal generation of RINs whenever possible. For YTD 2023 through September: ▪ Approximately 20% of refined product sale
Slide 11: High-Quality Refining Assets
High-Quality Refining Assets Consolidated High Utilization Rates Total Throughput and Production Mix(1) Consolidated Top Tier Refining Margin(1) Consolidated Low-Cost Operator(2) (1) Based on total throughputs and production for the twelve months ended September 30, 2023. Excludes publicly disclosed
Slide 12: Constructive Macro Environment: Demand
Constructive Macro Environment 11Source: EIA US Gasoline Demand PADD II Gasoline Demand US Diesel Demand PADD II Diesel Demand
Slide 13: Constructive Macro Environment: Inventories
Constructive Macro Environment 12Source: EIA US Gasoline Inventories PADD II Gasoline Inventories US Diesel Inventories PADD II Diesel Inventories
Slide 14: Constructive Macro Environment: Crack Spreads and Differentials
Constructive Macro Environment 13Source: MarketView as of December 27, 2023 2-1-1 Crack Spreads & Brent-WTI Differentials ($/bbl) WCS – WTI Differential ($/bbl)RVO-Weighted RINs ($/bbl) Group 3 Crack Spreads ($/bbl)
Slide 15: Wynnewood Feed Pretreater and Renewable Projects
▪ Construction is underway on a feed pretreater at Wynnewood that would enable processing of inedible corn oil, animal fats and used cooking oils that generate additional LCFS credits. ▪ Capitalizes on Wynnewood’s strategic location in the farm belt with access to a wide variety of feedstock supply.
Slide 16: Renewable Diesel Initiatives KSAAT Project at Wynnewood
Renewable Diesel Initiatives 15 KSAAT Project at Wynnewood Renewable diesel margins impacted by several factors: ▪ Crude oil price and spread between ULSD and Soybean oil (HOBO spread) ▪ Feedstock basis (transportation cost + premium for pretreated material) ▪ RINs prices (1.7 D4 Biodiesel RINs gene
Slide 17: Capital Expenditures and Turnarounds
Capital Expenditures and Turnarounds 16 Note: As of September 30, 2023. Shaded areas indicate the top end of capital expenditure estimates. ▪ Maintenance capex estimated at $91MM to $99MM. ▪ YTD maintenance capex through 9/30/2023 of $71MM. ▪ Growth capex estimated at $74MM to $87MM. ▪ Substantially
Slide 18: Fertilizer Segment
FERTILIZER SEGMENT
Slide 19: Stable Trends in Fertilizer Supply & Demand
18 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 2023/2024 at approximately 15%. Nitrog
Slide 20: Strong Demand for Corn in the U.S.
Strong Demand for Corn in the U.S. Source: USDA Economic Research Service and USDA WASDE. (1) Based on 2018 – 2022 average. 19 ▪ 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
Slide 21: Recent Domestic Nitrogen Fertilizer Market Conditions
▪ Summer UAN fill and fall prepay ammonia programs completed in July. Strong demand for nitrogen going into 4Q with consistent buying taking place as growers are in strong financial conditions. Corn Belt UAN and Ammonia prices for 4Q delivery currently approximately $280 - $300/ton and $510 - $525/t
Slide 22: Nitrogen Fertilizer Facilities and Marketing Area
▪ Large geographic footprint serving the Southern Plains and Corn Belt regions ▪ Well positioned to minimize distribution costs and maximize net back pricing ▪ Rail loading rack at the Coffeyville facility provides significant logistics optionality west of the Mississippi River due to access to both
Slide 23: Key Operating Statistics
Key Operating Statistics Consolidated Production Volumes(1) Consolidated Ammonia Utilization Consolidated Feedstock Costs(1) Consolidated Sales Revenue(1)(2) (1) For the twelve months ended September 30, 2023. (2) Excludes freight and other. 22
Slide 24: Capital Expenditures and Turnaround Expenses
Capital Expenditures and Turnaround Expenses 23 ▪ Maintenance capex estimated at $26MM - $28MM. ▪ YTD maintenance capex through 9/30/2023 $17MM. ▪ Growth capex estimated at $3MM - $4MM. ▪ Coffeyville and East Dubuque planned turnarounds were completed on schedule and on budget in 3Q 2022 with $12MM
Slide 25: Appendix
APPENDIX
Slide 26: Non-GAAP Financial Measures
Non-GAAP Financial Measures 25 Adjusted EBITDA – EBITDA adjusted for certain significant non-cash items and items that management believes are not attributable to or indicative of our on-going operations or that may obscure our underlying results and trends. Direct Operating Expenses per Throughput
Slide 27: Non-GAAP Financial Measures: CVR Energy
Non-GAAP Financial Measures 26 Note: All amounts on this slide are adjusted for the turnaround accounting change effective in 1Q 2019. These amounts are unaudited. (In USD Millions) CVR Energy, Inc. 2020 2021 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 LTM Net Income (loss) (320)$ 74$ 644$ 172$ 259$ 168$ 3
Slide 28: Non-GAAP Financial Measures: Petroleum Segment
Non-GAAP Financial Measures 27 Petroleum Segment (In USD Millions, except per bbl data) Refining Margin 2020 2021 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 LTM Net sales 3,586$ 6,721$ 9,919$ 2,422$ 1,993$ 2,000$ 2,298$ 8,713$ Less: Cost of materials and other (3,288) (6,100) (8,488) (2,074) (1,582) (1,66
Slide 29: Non-GAAP Financial Measures: CVR Partners
Non-GAAP Financial Measures 28 (In USD Millions) CVR Partners, L.P. 2020 2021 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 LTM Net Income (loss) (98)$ 78$ 287$ 95$ 102$ 60$ 1$ 258$ Add: Interest expense and other financing costs, net of interest income 63 61 34$ 8 7 7 8 30 Add: Depreciation and amortization
Slide 30: 2023 Estimated Capital Expenditures
2023 Estimated Capital Expenditures 29 (1) Renewables reflects spending on the Wynnewood Refinery’s renewable feedstock pretreater project. As of September 30, 2023, Renewables does not meet the definition of a reportable segment as defined under Accounting Standards Codification Topic 280. Maintena
Slide 31: Simplified Organizational Structure
50% CVR Energy, Inc. NYSE: CVI Icahn Enterprises L.P & Affiliates Public CVR GP, LLC CVR Partners, LP NYSE: UAN Nitrogen Fertilizer Segment Subsidiaries Public 63.2 % N-E GP Interest(2) (1) Ownership is 100% unless otherwise noted (2) Non-Economic General Partner Interest (“N-E GP Interest”) 33.7 %