Delek Us Holdings, Inc. · NYSE:DK
Delek Us — Investor Presentation (February 2012)
32 slides from Delek Us's investor presentation, Feb 1, 2012
Slide 1: Investor Presentation February 2012
Investor Presentation February 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 product terminals and pipeline assets in Texas, Arkansas and Tennessee Marketing
Slide 4: Recent Financial Performance
Recent Financial Performance 4 Growth In Contribution Margin ($MM)(1,2,3) (1) Segment contribution margin = net sales less cost of sales and operating expenses, excluding depreciation and amortization. Periods are for the nine months ended Sept. 30, 2011. (2) Represents net income from continuing op
Slide 5: Increased Financial Flexibility
Increased Financial Flexibility 5 (1) On November 1, 2011, the Company announced that the Board voted to declare a special cash dividend of $0.18/share. The Board also approved a regular quarterly cash dividend of $0.0375/share. (2) As of the end of the period Increase In Cash/Equivalents ($MM)(2) D
Slide 6: Financial Results | Third Quarter 2011
Financial Results | Third Quarter 2011 6 Generated a record $92.5 million in net income Reported Record Quarterly Profit Refining segment generated approximately 90% of total contribution margin Strong Benefit From Refining Segment Both Tyler and El Dorado operated near nameplate capacity Executive
Slide 7: Preliminary Results | Fourth Quarter 2011
Preliminary Results | Fourth Quarter 2011(1) 7 Executive Summary (1) As announced in the Company’s preliminary fourth quarter 2011 results press release dated January 26, 2012 Anticipate a Net Loss in 4Q11 Delek US expects to report a net loss from continuing operations in the range of ($0.10) to
Slide 8: Areas of Strategic Focus
8 Increase Crude Slate Flexibility Ensure Operational Reliability Access Cost-Advantaged Feedstocks(1) Complete Value-Enhancing Capital Projects(1) Expand Product Distribution Opportunities(1) Maintain Balance Sheet Discipline Objective: To drive superior returns for our shareholders by increasing t
Slide 9: Lion Oil Company Acquisition Summary
Lion Oil Company Acquisition Summary
Slide 10: Acquired Remaining Minority Interest In Lion Oil
Acquired Remaining Minority Interest In Lion Oil Timeline Lion Oil Is Now Wholly Owned By Delek US 10 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 Assumes 100% Equity Ownership Acquired remaining 1
Slide 11: 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 12: Light Product Marketing Throughout the Mid-Continent
Light Product Marketing Throughout the Mid-Continent 12 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 13: Refining Segment Operational Update
Refining Segment Operational Update
Slide 14: Refining Segment | 3Q11 Update
Refining Segment| 3Q11 Update Gulf Coast 532 Crack Spread reached elevated levels in 3Q11 Product slate weighted toward light, high-value products 14 Elevated refined product margins Refining CM increased by $177 mm y/y in 3Q11 3Q11 CM: Tyler = 57% / El Dorado = 43% Record quarterly contribu
Slide 15: Optimized Production Capabilities
Optimized Production Capabilities 15 The Addition of El Dorado has Contributed To Record System-Wide Throughputs El Dorado Diversified Our System-Wide Production Slate To Include Asphalt 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0% 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 Gasoline/Distillate as %
Slide 16: 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 uni t High Conversion, Moderate Complexity Primarily local domestic crudes such as WTI and East Texas Crude Processes Mostly Light Swe
Slide 17: 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, ~80% of production is gasoline and disti
Slide 18: Tracking The WTI-LLS Crude Differential
Tracking The WTI-LLS Crude Differential(1) 18 WTI-LLS Crude Differential Narrowed Sharply In 4Q11, But Has Widened In January 2012 ($7.88) ($15.94) ($14.69) ($15.36) ($15.56) ($17.36) ($17.71) ($23.09) ($27.50) ($25.59) ($14.82) ($10.10) ($10.47) ($30.00) ($25.00) ($20.00) ($15.00) ($10.00) ($5.00)
Slide 19: WTI-Brent Differential Forward Curve
WTI-Brent Differential Forward Curve 19 Futures Markets Expect the WTI-Brent Differential To Remain Wide Over a Multi-Year Period(1) (1) Source: Bloomberg (as of January 31, 2012) ($14.00) ($12.00) ($10.00) ($8.00) ($6.00) ($4.00) ($2.00) $0.00 W TI -Brent D if ferential P er Bar re l Forward Curve
Slide 20: Gulf Coast Refining Margin Benchmark
Gulf Coast Refining Margin Benchmark Building a Refining Benchmark HSD 532 Gulf Coast Crack Spread (+) Contango or (-) Backwardation “Theoretical” Benchmark For Tyler 20 High-Sulfur Diesel 5-3-2 Gulf Coast Crack Spread, Including Contango/Backwardation(1) (1) WTI Backwardation/Contango data is suppl
Slide 21: Increasing Crude Slate Flexibility at El Dorado
Increasing Crude Slate Flexibility at El Dorado 21 (1) Louisiana Offshore crude oil includes Eugene Island, Louisiana Light Sweet, Mars, North Louisiana Sweet, Poseidon and Thunder Horse Blend (2) Other crude oils includes Yoho condensate, Basrah Light and Appalachian Light Sweet (3) As indicated on
Slide 22: Identified "Quick-Hit" Capital Projects
Identified “Quick-Hit” Capital Projects 22 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 23: Retail Segment Operational Update
Retail Segment Operational Update
Slide 24: Retail Segment | 3Q11 Update
Retail Segment | 3Q11 Update(1) 9th consecutive quarter of y/y same-store growth Benefit from fresh food sales and promotional efforts 24 Same-Store Merchandise Sales Growth Emphasized a competitively priced fuel offering Offering value to cost-conscious consumer Benefit From Fuel Pricing St
Slide 25: 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 Same-Store Merchandise Sales ) Relevant Factors: Commodity prices, weather, empl oyment, supply disruptions Same-Store Gallons Sold 25 Same-Store Merchandise S
Slide 26: Private Label Initiative Making Progress
Private Label Initiative Making Progress Creating A New Unique Shopping Experience Higher margin, lower-cost option for consumers Quality, Affordable Replacement Option ) Private label is an effective way of offering valu e to time-starved consumers Countermeasure To Channel Blur 26 Private Label vs
Slide 27: Store Reimaging & New Construction Initiatives
Store Reimaging & New Construction Initiatives Reimaging and Construction Update Approximately 43% of store base was reimaged / newly constructed as of 9/30/11 Multi-Year Store Enhancement Initiative ) Long-term target of at least 10-20 new large-format builds per annum Multi-Year New Store Construc
Slide 28: Marketing Segment Operational Update
Marketing Segment Operational Update
Slide 29: Marketing Segment | 3Q11 Update
Marketing Segment | 3Q11 Update Wholesale Marketing In West Texas Owned (San Angelo, Abilene, Tyler); Third-Party (Aledo, Odessa, Big Springs, Frost) Product Marketing Terminals ) Owned and leased pipelines transport crude to Tyle r refinery Supply Synergies With Tyler 29 ) Annual CAPEX less than $1
Slide 30: Appendix Additional Data
Appendix Additional Data
Slide 31: Historical and Projected Capital Spending
Historical and Projected Capital Spending(1) 31 (1) Capital spending estimates as provided in the Company’s latest form 10-Q filed with the Securities and Exchange Commission and on the Company’s third quarter earnings conference call held on November 3, 2011. $42.3 $40.9 $77.0 $14.5 $38.7 $33.0 $56
Slide 32: NYSE: DK
DK NYSE
Delek US Holdings — Investor Presentation (February 2012) on 6ix