Delek Us Holdings, Inc. · NYSE:DK
Delek Us — Investor Presentation (April 2012)
29 slides from Delek Us's investor presentation, Apr 16, 2012
Slide 1: Investor Presentation April 2012
Investor Presentation April 2012
Slide 2: Safe Harbor Provision
Safe Harbor Provision 2 Delek US Holdings is traded on the New York Stock Exchange in the United States under the symbol “DK” and, as such, is governed by the rules and regulations of the United States Securities and Exchange Commission. This presentation may contain forward-looking statements that
Slide 3: Integrated Downstream Energy Company
Integrated Downstream Energy Company(1) Breadth of Exposure Across Refining, Wholesale Marketing and Retail Distribution Operates 140,000 BPD of refined production capacity in Texas and Arkansas Refining Segment ) Owned crude/product terminals and pipeline assets in Texas, Arkansas and Tennessee Mar
Slide 4: Recent Financial Performance
Recent Financial Performance 4 (1) Represents adjusted net income from continuing operations (2) Delek US assumed operational control of the El Dorado refinery and related assets through the acquisition of a majority equity interest in Lion Oil on April 29, 2011 Substantial Growth In Net Income ($MM
Slide 5: Areas of Strategic Focus
5 Increase Crude Slate Flexibility Ensure Operational Reliability Access Cost-Advantaged Feedstocks Complete Value-Enhancing Capital Projects Expand Product Distribution Opportunities Maintain Balance Sheet Discipline Objective: To drive superior returns for our shareholders by increasing the scale
Slide 6: Refining Segment Operational Update
Refining Segment Operational Update
Slide 7: Longview Supports Crude Slate Flexibility for Refining System
Longview Supports Crude Slate Flexibility for Refining System 7 Focused On Increasing Refining System Access to Cost-Advantaged Feedstocks Tyler Refinery El Dorado Refinery Longview Crude Hub Longview Can Receive Gulf Coast and Foreign Crudes Longview Can Receive West Texas Crudes Longview Can Recei
Slide 8: Optimized Refining System To Support Regional Demand
Optimized Refining System To Support Regional Demand 8 Increased Refining System Reliability(1) Lion Oil Acquisition More Than Doubled Sales Volumes In The Gulf Coast and Mid- Continent (1) 89.8% 86.1% 82.2% 83.3% 92.7% 2007 2008 2009 2010 2011 53,439 59,161 46,500 54,405 58,261 127,962 142,237 138,
Slide 9: Favorable Refining Economics Continue Into 2Q12
Favorable Refining Economics Continue Into 2Q12(1) 9 Elevated Refined Product Margins and Discounted WTI-Linked Feedstock Favor Delek US (1) Source: Platts and Bloomberg; April 2012 data is as of April 8, 2012 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 ($30.00) ($20.00) ($10.00) $0.00 $10.00 $20.0
Slide 10: Crude Slate Transition at El Dorado Underway
Crude Slate Transition at El Dorado Underway 10 Historically processed local Arkansas, domestic offshore and foreign crude oils El Dorado Has A Diverse Crude Slate Displaced expensive foreign and GC crudes with discounted local, inland crudes Supplying More WTI-Linked Barrels We Anticipate El Dorado
Slide 11: Access To Lower Cost Crude at Tyler Refinery
Access To Lower Cost Crude at Tyler Refinery 11 Processes primarily West Texas Intermediate and East Texas crude oils On a blended basis, Tyler purchased crude at ~$1.50/bbl above WTI in 1Q12 Tyler Crude Costs Near Parity with WTI Tyler Refinery Enjoys An Advantaged Crude Slate – Anticipate More Low
Slide 12: Identified Quick-Hit Capital Projects
Identified “Quick-Hit” Capital Projects 12 Low-Cost, High-Return Capital Projects at Tyler and El Dorado(1) LSR/Sat Gas Project (LSR) Scope: Improves liquid recovery of Butane & Propane at El Dorado Anticipated Cost: $16 million Anticipated Return: $20 million contribution margin annually An
Slide 13: Retail Segment Operational Update
Retail Segment Operational Update
Slide 14: Growth In Same-Store Sales
Growth In Same-Store Sales Key Factors That Drive Same-Store Sales Relevant Factors: Location, size, appeal, offering, affordability, people Sam -Store Merchandise Sales ) Relevant Factors: Commodity prices, weather, employment, supply disruptions Same-Store Gallons Sold 14 Consistent Growth In Same
Slide 15: Store Reimaging & New Construction Initiatives
Store Reimaging & New Construction Initiatives(1) Reimaging and Construction Update Approximately 180 stores have been built or reimaged since 2006 Multi-Year Store Enhancement Initiative ) Long-term target of at least 10-20 new large-format builds per annum Multi-Year New Store Construction Plan 15
Slide 16: Marketing Segment Operational Update
Marketing Segment Operational Update
Slide 17: Midstream Assets Generate Consistent Results
Midstream Assets Generate Consistent Results Wholesale Marketing In West Texas Owned (San Angelo, Abilene, Tyler); Third-Party (Aledo, Odessa, Big Springs, Frost) Product Marketing Terminals 17 ) Annual CAPEX less than $1 million per year 2006-2011 Minimal CAPEX requirements ) Positive contribution
Slide 18: Recent Acquisitions of Midstream Assets
Recent Acquisitions of Midstream Assets 18 Recent Acquisitions Improve Crude Procurement, Product Distribution Capabilities Paline Pipeline System (December 2011) 10-inch, 185-Mile crude line for $50.0 mm 36,000 bpd capacity; runs from Longview to Nederland, TX Line being reversed under lease
Slide 19: Appendix Additional Data
Appendix Additional Data
Slide 20: Year-over-Year Improvement In Refining Economics
Year-over-Year Improvement In Refining Economics 20 Tracking the HSD 5-3-2 Gulf Coast Crack Spread Per Barrel(1) (1) Source: Platts and Bloomberg; March 2012 and YTD 2012 data is thru March 19, 2012 $13.61 $19.23 $19.67 $17.16 $19.78 $25.10 $24.69 $22.92 $0.00 $5.00 $10.00 $15.00 $20.00 $25.00 $30.0
Slide 21: WTI-Brent Differential Forward Curve
WTI-Brent Differential Forward Curve 21 Futures Markets Expect the WTI-Brent Differential To Remain Wide Over a Multi-Year Period(1) (1) Source: Bloomberg; as of March 19, 2012 ($20.00) ($18.00) ($16.00) ($14.00) ($12.00) ($10.00) ($8.00) ($6.00) ($4.00) ($2.00) $0.00 Forward Curve Indicates An Aver
Slide 22: Historical and Projected Capital Spending
Historical and Projected Capital Spending 22 2010: $56.8 mm 2011: $81.0 mm 2012 (E): $113.0 mm $42.3 $36.0 $75.0 $14.5 $45.0 $38.0 2010 (A) 2011 (A) 2012 (E) Refining Retail, Marketing and Other Estimate includes a full-year of capital spending at Lion Oil Company
Slide 23: Tyler, Texas Refinery Update
Tyler, Texas Refinery Update Overview 60,000 barrels per day located in East Texas Niche, Inland Refiner In PADD III ) 9.4 complexity; equipped with a delayed coking unit High Conversion, Moderate Complexity Primarily local domestic crudes such as WTI and East Texas Crude Processes Mostly Light Swee
Slide 24: El Dorado, Arkansas Refinery Update
El Dorado, Arkansas Refinery Update Overview 80,000 BPD, 9.0 complexity refinery located in Southern Arkansas Inland refinery in PADD III ) Crude slate transitioning from Brent-based to WTI-based crudes Process Local, Offshore, Foreign Crudes Historically, 70-80% of production is gasoline and dist
Slide 25: Acquired Remaining Minority Interest In Lion Oil
Acquired Remaining Minority Interest In Lion Oil Timeline Lion Oil Is Now Wholly Owned By Delek US 25 1922 1985 July 2007 Sept. 2007 Apr. 2011 Oct. 2011 Inception of Lion Oil Ergon and other investors assume ownership DK acquires 28.4% interest DK acquires 6.2% interest DK acquires 53.7% interest DK
Slide 26: Transaction Summary
Transaction Summary Asset Overview Purchase Summary 80,000 BPD refinery in El Dorado, Arkansas 80-mile Magnolia-El Dorado crude oil system (Shreveport, LA to Magnolia terminal) 28-mile El Dorado crude oil system (Magnolia terminal to El Dorado refinery) Crude oil gathering system with more t
Slide 27: Light Product Marketing Throughout the Mid-Continent
Light Product Marketing Throughout the Mid-Continent 27 Access To The Enterprise Products Pipeline(1) Integration Opportunity Expands marketing opportunity into the Mid-Continent El Dorado expected to supply MAPCO store locations in Tennessee and Arkansas Tyler and El Dorado Expected To Ship Pro
Slide 28: Asphalt Prices Above Prior-Year Levels
Asphalt Prices Above Prior-Year Levels(1) 28 Midwest/Mid-Con Market – Tulsa, Oklahoma / Southern Kansas (Asphalt Price Per Barrel) (1) Source: Poten & Partners $0.00 $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2010 2011 2012
Slide 29: NYSE: DK
DK NYSE
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