Cvr Energy Inc. · NYSE:CVI
Cvr Energy — Investor Presentation (March 2021)
31 slides from Cvr Energy's investor presentation, Mar 2, 2021
Slide 1: March 2021 Investor Presentation
March 2021 Investor Presentation
Slide 2: Forward-Looking Statements
Forward-Looking Statements 2 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 unde
Slide 3: Mission and Values
Mission and Values 3 3 Our Guiding Principles 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. C
Slide 4: Company Overview
Petroleum Segment Fertilizer Segment Company Overview 4 4 CVR Energy is a diversified holding company primarily engaged in the petroleum refining and nitrogen fertilizer manufacturing industries. CVR Energy’s Petroleum segment is the larger of the two businesses and is comprised of two Mid-Continent
Slide 5: Strategic Priorities
Strategic Priorities 5 Focus on Operating Safely, Controlling Costs and Maintaining Balance Sheet & Liquidity Improve EH&S Performance Focus on Crude Oil Quality & Differentials Reduce our RIN Exposure Reduce Lost Opportunities Continuing to improve in all Environmental, Health and Safety matters -
Slide 6: Capital Allocation Strategy
Capital Allocation Strategy 6 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 r
Slide 7: Petroleum Segment
PETROLEUM SEGMENT
Slide 8: Asset Footprint: Mid-Continent Refineries
Asset Footprint 8 Mid-Continent Refineries Nameplate crude oil capacity of 206,500 bpd across two refineries • 4Q20 total throughput of 218,541 bpd • 2020 total throughput of 183,295 bpd(1) Average complexity of 10.8 Located in Group 3 of PADD II Crude Oil Sourcing Optionality ➢ Refineries are strat
Slide 9: Strategically Located Mid-Con Refineries Marketing Network
Strategically Located Mid-Con Refineries 9 Marketing Network Optionality Multiple Takeaway Options Provide Product Placement Flexibility ➢ Marketing activities focused in central mid- continent area via rack marketing, supplying nearby customers and at terminals on third- party distribution systems
Slide 10: High-Quality Refining Assets
Gasoline 54% Distillate 41% Other (5) 5% Regional Crude 50% WTI 28% WTL 3% Midland WTI 1% Condensate 8% Heavy Canadian (3) 1% Other (4) 9% High-Quality Refining Assets Total Throughput(1) Total Production(1) Consolidated Top-Tier Refining Margin(1) Consolidated Low-Cost Operator(2) (1) Based on tota
Slide 11: Improving Macro Environment: Demand
Improving Macro Environment 11Source: EIA, Magellan Mid Con Supply and Demand Fundamentals Trending Better than US Average US Gasoline Demand Magellan System Gasoline Demand US Diesel Demand Magellan System Diesel Demand
Slide 12: Improving Macro Environment: Inventories
Improving Macro Environment 12Source: EIA, Magellan Mid Con Supply and Demand Fundamentals Trending Better than US Average US Gasoline Inventories Magellan System Gasoline Inventories US Diesel Inventories Magellan System Diesel Inventories
Slide 13: Improving Macro Environment: Crack Spreads
Improving Macro Environment 13Source: MarketView as February 23, 2021 Crack Spreads Have Improved With Product Demand Recovery and Inventory Declines 2-1-1 Crack Spreads & Brent-WTI Differentials ($/bbl) Midland-Cushing and WTL-WTI Differentials ($/bbl)WCS – WTI Differential ($/bbl) WTI-Based Gasoli
Slide 14: Progressing Renewable Diesel Project
Progressing Renewable Diesel Project(1) 14 Potential Multi-Phase Project Utilizing Existing Assets at Both Refineries • Convert the existing hydrocracker at Wynnewood to Renewable Diesel service • Retool the Wynnewood Refinery for maximum condensate processing • Capacity of 100 million gallons per y
Slide 15: Renewable Diesel: KSAAT Project at Wynnewood
Progressing Renewable Diesel Project(1) 15 KSAAT Project at Wynnewood Full Board Approval for Phase 1 Wynnewood Hydrocracker Conversion Project Highlights: • Convert 19,000 BPD hydrocracker at Wynnewood to process 100 million gallons per year of washed and bleached soybean oil to produce renewable d
Slide 16: Renewable Diesel Project Economics and Sensitivities
Progressing Renewable Diesel Project(1) 16 KSAAT Project at Wynnewood Renewable Diesel Project Economics and Sensitivities Project Economics: ➢ Renewable diesel margins impacted by several factors: ➢ Crude oil price and spread between ULSD and Soybean oil (HOBO spread) ➢ RINs prices (1.7 D4 Biodiese
Slide 17: Capital Expenditures and Turnarounds
Capital Expenditures and Turnarounds 17Note: As of December 31, 2020 2021 Petroleum Segment and RDU Capex of $189 - $200M Environmental and Maintenance spending planned at $94M to $100M for FY21. Growth capex budgeted at $95M to $100M ➢ Substantially all budgeted growth capital spending for 2021 is
Slide 18: Fertilizer Segment
FERTILIZER SEGMENT
Slide 19: Stable Trends in Fertilizer Demand
19 Stable Trends in Fertilizer Demand Source: Fertecon, World Bank Global nitrogen consumption increased by 15% between 2009 and 2020 driven by: ➢ Population growth ➢ Decrease in arable farmland per capita ➢ Biofuel consumption ➢ Continued evolution to more protein-based diets in developing countrie
Slide 20: U.S. Nitrogen Supply & Demand
➢ Nitrogen fertilizers represent approximately 15% of farmers’ cost structure and significantly improves yields. ➢ UAN prices in 2020 declined $23/ton from 2019, or 12% Y/Y. ➢ USDA projecting stocks to use ratio for 2020/2021 at less than 11%, its lowest level in over 5 years. ➢ Since the beginning
Slide 21: Strong Demand for Corn in the U.S.
21 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 ~38% of annual corn crop(1) ➢ Ethanol ▪ Consumes ~37% of annual
Slide 22: 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 due
Slide 23: Key Operating Statistics
23 Key Operating Statistics Consolidated Production Volumes (1) Ammonia Utilization(2) Consolidated Feedstocks Costs(1) Consolidated Sales Revenue(1)(3) (1) For the last twelve months ended December 31, 2020. (2) Adjusted by planned turnarounds. (3) Excludes freight. Consistent High Utilization at B
Slide 24: Capital Expenditures and Turnaround Expenses
Capital Expenditures and Turnaround Expenses 24Note: As of December 31, 2020 2021 Total Capex budget of $23M - $26M Environmental and Maintenance spending planned at $18M - $20M Growth capex budgeted at $5M - $6M ➢ Growth capex budget includes Urea/UAN expansion projects at Coffeyville 2021 Turnarou
Slide 25: Appendix
APPENDIX
Slide 26: Non-GAAP Financial Measures
Non-GAAP Financial Measures 26 Available Cash for Distribution - EBITDA for the quarter excluding non-cash income or expense items (if any), for which adjustment is deemed necessary or appropriate by the board of directors (the “Board”) of our general partner in its sole discretion, less (i) reserve
Slide 27: Non-GAAP Financial Measures
Non-GAAP Financial Measures 27 Note: All amounts on this slide are adjusted for the turnaround accounting change effective in 1Q19. These amounts are unaudited (1) Due to rounding, numbers within this table may not add or equal to totals presented Petroleum Segment (In USD Millions) CVR Energy, Inc.
Slide 28: Non-GAAP Financial Measures
Non-GAAP Financial Measures 28 (1) Due to rounding, numbers within this table may not add or equal to totals presented Twelve Months (In USD Millions) March 31, June 30, September 30, December 31, Ended 2020 2020 2020 2020 December 31, 2020 (1) Consolidated Net loss (101)$ (32)$ (108)$ (78)$ (320)$
Slide 29: Non-GAAP Financial Measures
Non-GAAP Financial Measures 29 (In USD Millions) CVR Partners, LP 2016 2017 2018 2019 2020 Net Income (loss) (27)$ (73)$ (50)$ (35)$ (98)$ Add: Interest expense and other financing costs, net of interest income 49 63 62 62 63 Add: Income tax expense (benefit) - - - - - Add: Depreciation and amortiza
Slide 30: 2021 Estimated Capital Expenditures
2021 Estimated Capital Expenditures 30 (1) Total 2021 estimated capital costs includes approximately $3 to $4 million of growth-related projects that will require additional approvals before commencement (2) Includes total 2020 RDU capital expenditures of $12 million (3) Includes total 2021 estimate
Slide 31: Simplified Organizational Structure
Simplified Organizational Structure 31 Public 29% 71% Public 34.1% 65.9% 63.6% 36.4% Non-Economic General Partner Interest Non-Economic General Partner Interest 50% 40% Enable South Central Pipeline, LLC Nitrogen Fertilizer Segment Icahn Enterprises L.P. and Affiliates Petroleum Segment CVR Energy,