Calumet, Inc · NASDAQ:CLMT
Calumet — Calumet Specialty Products Partners — Bank of America Leveraged Finance Conference November 2023
21 slides from Calumet's conference presentation, Nov 29, 2023
Slide 1: Bank of America Leveraged Finance Conference November 2023
Bank of America Leveraged Finance Conference November 2023
Slide 2: Cautionary Statements
Cautionary Statements Calumet Specialty Products Partners, L.P. Forward-Looking Statements This Presentation has been prepared by Calumet Specialty Products Partners, L.P. (the “Company,” “Calumet,” “CLMT,” “we,” “our,” or like terms) and Montana Renewables LLC (“MRL”) as of November 29, 2023. The i
Slide 3: Tax Disclosures
Tax Disclosures No Advice This Presentation has been prepared by Calumet as of November 29, 2023. This Presentation has been prepared for informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Calumet unitholders should consult t
Slide 4: CLMT: Two Competitively Advantaged & Separable Businesses
CLMT: Two Competitively Advantaged & Separable Businesses Specialties Renewables Leading specialty products company with demonstrated Powerful growth platform is operating. earnings power and identified growth Consistently producing on-spec RD and Sustainable Aviation Fuel (SAF) Unique, prominent cu
Slide 5: The New Calumet: A Transformed Company
The New Calumet: A Transformed Company 2020 – 2023 Near-Term Priorities 2024+ • Transformed business • Generate cash for deleveraging • Organic growth • Multiple operational records • MRL is fully operational identified • Resilience of business demonstrated during COVID • Use expected MRL • Opportun
Slide 6: Transaction Overview: C-Corp Transition
Transaction Overview: C-Corp Transition On November 9, 2023, Calumet announced plans to transition to a C-Corp to maximize future opportunities, access a broader base of investors and unlock shareholder value Transaction highlights: C-Corp transition will eliminate Incentive Distribution Rights (“ID
Slide 7: Bond Yield Versus Indices
Bond Yield Versus Indices CLMT 2028 Yield vs B & CCC Rated Indices Select Credit Highlights 4.00% 2.00% Diversified customer base, with supply of over 2,500 0.00% products to more than 1,000 customers -2.00% Specialty chemical business provides niche, critical -4.00% products to customers Jun Jun—Ju
Slide 8: Core Business Transformation Through Execution
Core Business Transformation Through Execution Specialties Material Margin ($/BBL) 5 consecutive years of Specialties margin growth Combination of exceptional team, integrated assets, $90 high customer focus, technology, and strong market $80 18% of our production volumes are upgraded through our in
Slide 9: Montana Renewables Operational Update
Montana Renewables Operational Update Montana Renewables is the largest SAF Operating fully going into December producer in North America Reinforced mid-cycle Adjusted EBITDA guidance of $1.25—$1.45 / gal based on untreated feedstocks Pre-treater test demonstrated 11,000bpd feed intake SAF contracte
Slide 10: SAF – Energy's Fastest Growing Market?
SAF – Energy’s Fastest Growing Market? Aviation is “last frontier” for decarbonization No legitimate alternatives to liquid fuel First mover in potentially fastest growing addressable market in energy “We estimate SAF could contribute around 65% of the reduction in aviation emissions needed to reach
Slide 11: 2023: Final Steps in Value Unlock
2023: Final Steps in Value Unlock Montana Renewables Strategy Q3 2022 Q4 2022 Q1 2023 Q2 2023 Next Steps Warburg Pincus Commissioned RD plant Commissioned SAF: Preferred Equity and commenced Solidify 1st mover Demonstrated Authorize and investment values MRL shipments and confirmed position and sign
Slide 12: CALUMET
Ca) CALUMET
Slide 13: Corporate Transition
Corporate Transition CLMT Unitholders CLMT unitholders to exchange all existing CLMT units in a 1-1 New CLMT ratio for New CLMT (C-Corp) common stock structured as a nontaxable “Reverse-Merger” transaction CLMT MLP © 2023 Calumet Specialty Products Partners, L.P. 13
Slide 14: Corporate Transition Tax Impact
Corporate Transition Tax Impact Transaction Closing Tax Benefits Subject to CLMT unitholder approval, the Nontaxable Corporate Conversion Unlike many other public MLP simplification or conversions, CLMT is pursuing a Transaction is anticipated to close in mid-2024 (“Transaction Closing”) Nontaxable
Slide 15: Dilution Calculation
Dilution Calculation Post-Unit/Share Count Summary Now Conversion Existing LP Units / Common Stock 80.0 80.0 Existing GP Units 1.6 -New Shares Issued at Closing—5.5 Total Economic Shares Outstanding 81.6 85.5 *4.5% Dilution (Excluding Warrants) Warrants: 2.0 million Strike Price $20 / share Term: 3
Slide 16: Constant Renewable Diesel Margin Framework
Constant Renewable Diesel Margin Framework $9.00 $9.00 $7.00 $7.00 $5.00 $5.00 $3.00 $3.00 $1.00 $1.00 $(1.00) $(1.00) $(3.00) $(3.00) $(5.00) $(5.00) $(7.00) $(7.00)—20 20—20—20—20 — 21 21—21—21—21—21 — 21 21—21—21—21 — 21 22—22 — 22 22 — 22 22 — 22 22—22 — 22—22—22—23—23 23 — 23—23 23—23—23 - 23 —
Slide 17: MRL – Significant Location Advantage
MRL – Significant Location Advantage Montana Product Advantage Montana Feedstock Advantage Calumet Feedstock: Lower cost of transportation into Great Falls Calumet Product: Best access to PNW, Canada Industry Feedstock: Higher cost of feedstock transportation to GC Industry Product: Great Falls, MT
Slide 18: RINs Legal Summary
RINs Legal Summary CALUMET SPECIALTY PRODUCTS PARTNERS, L.P. Congress included a small refinery exemption (SRE) in the Clean Air Act to address the disproportionate economic hardship of the Renewable Fuels Standard on small refiners like Calumet Calumet’s two small refineries consistently received S
Slide 19: Capital Structure Overview
Capital Structure Overview Actual Actual Actual Actual Actual Actual Actual Actual ($ in millions) 12/31/21 03/31/22 06/30/22 09/30/22 12/31/22 03/31/23 06/30/23 09/30/23 Unrestricted Cash $ 38.1 $ 10.7 $ 27.5 $ 50.5 $ 35.2 $ 11.2 $ 36.0 $ 13.7 ABL Revolver Borrowings $ — $ 11.0 $ — $ 87.0 $ 104.0 $
Slide 20: Reconciliation of Net Income (Loss) to Adjusted EBITDA
Reconciliation of Net Income (Loss) to Adjusted EBITDA ($ in millions) 3Q 2021 4Q 2021 1Q 2022 2Q 2022 3Q 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 Net income (loss) attributable to partners $51.5 $(87.1) $(95.5) $(15.3) $15.7 $(70.0) $28.7 $(18.5) $103.0 Add: Depreciation and amortization 30.5 33.8 30.2
Slide 21: Reconciliation of Segment Gross Profit (Loss) to Segment Adjusted Gross Profit
Reconciliation of Segment Gross Profit (Loss) to Segment Adjusted Gross Profit (Loss) ($ in millions, except per barrel data) 4Q 2021 1Q 2022 2Q 2022 3Q 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 Specialty Products and Solution segment gross profit $19.2 $17.7 $88.1 $123.4 $95.9 $110.3 $45.3 $158.9 LCM/LI