Marathon Petroleum Corporation · NYSE:MPC
Marathon Petroleum — Q4 2021 Earnings Presentation
29 slides from Marathon Petroleum's earnings presentation, Feb 2, 2022
Slide 1: Fourth Quarter 2021 Earnings Conference Call
Fourth Quarter 2021 Earnings Conference Call February 2, 2022 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements regarding Marathon Petroleum Corporation (MPC). These forward-looking statements may relate to, among other things, MPC’s expectations, estimates and projections concerning its business and operations, financial priorit
Slide 3: Business Update
Business Update Progressing return of capital Strengthen Competitive Position - ~$3 billion repurchased since last earnings call of our Assets - ~55% of $10 billion capital return completed Incremental $5 billion share repurchase authorization(a) Low Cost Culture 2022 MPC capital outlook $1.7
Slide 4: Executing on Strategic Priorities
Executing on Strategic Priorities Strengthen Improve Low Cost Competitive Position Commercial Culture of our Assets Performance Speedway sale completed; Sustainable cost Beatrice Pretreatment $17.2B after-tax proceeds reductions of $1.5B Facility start-up comprised of: Dickinson RD start-up ADM Feed
Slide 5: Challenging Ourselves to Lead in Sustainable Energy
Challenging Ourselves to Lead in Sustainable Energy Strengthen Resiliency Strengthening our business for today, while building durability for tomorrow and beyond Target: Reduce Target: Reduce Target: Reduce Scope 1 and 2 GHG midstream methane freshwater 30% emissions intensity 50% emissions intensit
Slide 6: Fourth Quarter Highlights
Fourth Quarter Highlights $ Millions (unless otherwise noted) 4Q21 Adjusted Earnings per Share ($/share)(a) $1.30 Adjusted EBITDA $2,795 Cash from Operations, excluding Working Capital(b) $2,030 Dividends $354 Share Repurchases(c) $2,742 (a) Based on weighted average diluted shares (b)Excludes CARES
Slide 7: Low Cost Culture
Low Cost Culture $6/bbl Refining Operating Costs Corporate Costs ($ / Barrel) $214 MM ($ Millions, quarterly average) $174 MM $5.02 (a) (a) (a) 1H20 2H20 1H21 2H21 Full Year 1H20 2H20 1H21 2H21 Full Year 2021 2021 Maintaining commitment to low cost culture (a) Excludes storm impacts in 1Q21 and 3Q21
Slide 8: 2022 – MPC Financial Priorities
2022 – MPC Financial Priorities Growth Share Sustaining Capital Dividend Capital Repurchases Strong balance sheet foundation for strategy execution Maintain the safety, integrity, and reliability of our assets Disciplined growth opportunities, with focus on renewables Commitment to return capital to
Slide 9: 2022 – Capital Spending
2022 – Capital Spending MPC 2,505 Sustaining and Growth Capital(a) Continued focus on strict capital discipline, spending remains ~30% below 2019 levels 1,735 $ Millions 1,471 Sustaining capital underpins safety and environmental 1,066 Martinez ~50% of growth capital Remaining capex focused
Slide 10: Adjusted EBITDA to Net Income
Adjusted EBITDA to Net Income 4Q 2021 vs. 3Q 2021 Adjusted EBITDA Reconciliation to Net Income 3,000 354 30 2,795 -5 2,416 -132 2,000 $ Millions -1,017 TAR - 204 D&A - 813 1,000 774 -872 0 3Q 2021 Refining & Midstream Corporate 4Q 2021 Adjustments Turnaround Interest, 4Q 2021 Adj. EBITDA Marketing A
Slide 11: Refining & Marketing
Refining & Marketing 4Q 2021 vs. 3Q 2021 2,000 Refining margins 648 improved in the US 308 Gulf Coast and West 1,500 26 1,549 -152 -23 Coast -453 1,195 $ Millions 94% utilization during 1,000 the quarter Operating costs 500 impacted by higher natural gas prices 0 3Q 2021 USGC Mid-Con West Coas
Slide 12: Midstream
Midstream 4Q 2021 vs. 3Q 2021 1,500 13 17 1,405 1,375 Through-cycle EBITDA stability 1,000 Continued progress on $ Millions reducing operating expenses 500 Continued progress on organic growth projects 0 3Q 2021 MPLX Other 4Q 2021 Adj. EBITDA Midstream Adj. EBITDA 12
Slide 13: Total Consolidated Cash Flow
Total Consolidated Cash Flow 4Q 2021 20,000 1,254 0.4 = Income Taxes 1.6 = CARES Refund 2,030 -1.2 = Paid Speedway Taxes -541 15,000 222 386 $ Millions 13,226 -1,951 -691 -354 MPC - 2,251 10,839 MPLX 300 -2,742 10,000 ~$3.0 repurchased since Oct 31 5,000 9/30/2021 Operating Working Capital Net Debt
Slide 14: Financial Discipline: 2022 Capital Outlook
Financial Discipline: 2022 Capital Outlook 2022 Martinez refinery conversion 2021 Outlook ~50% of Growth Portfolio Refining & Marketing 911 1,625 Growth – Ongoing Projects 436 525 Growth – Renewables 318 800 Martinez 271 700 R&M Other Renewables 47 100 R&M Maintenance Maintenance 157 300 Growth MPC
Slide 15: Commitment to Capital Return
Commitment to Capital Return Incremental $10 Billion $5 Billion Repurchase Program Authorization $15 Billion ~$3.0 billion repurchased since last 5.0 5.0 earnings call(b) ~55% of $10.0 billion complete $ Billions 4.5 4.5 10.0 ~$4.5 billion remaining 5.5 5.5 Incremental $5.0 billion authorize
Slide 16: Balance Sheet: Foundation for Strategy Execution
Balance Sheet: Foundation for Strategy Execution 3.0 MPC Senior Notes Maturities - Next 10 Years (a) MPC Liquidity Minimum cash balance $1 billion 2.0 Available credit facilities $5 billion 1.0 Target Leverage 0.0 ~30% Gross 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 MPC Standalone Debt-to-Ca
Slide 17: First-Quarter 2022 Outlook
First-Quarter 2022 Outlook Other Charge/ Total Operating Distribution Depreciation Crude Sweet Sour Turnaround Utilization (a) Feedstocks Throughput Cost Cost and Throughput Crude Crude Costs Throughput (a) (b) (c) Amortization (a) $/BBL of Total in MBPD (except Utilization) Percent of Throughput $M
Slide 18: Questions & Answers
7 72= BEE == [NT A = 22) a
Slide 19: Appendix
Appendix 19
Slide 20: Balance Sheet: Foundation for Strategy Execution
Balance Sheet: Foundation for Strategy Execution Senior Notes Maturities - Next 10 Years (a) 3.0 MPC Excluding MPLX MPC As of Dec 31, 2021 MPLX Adjustments (c) Consolidated 2.0 ($MM except ratio data) $B Cash(d) 10,826 13 10,839 1.0 Total Debt 6,968 18,571 25,539 0.0 2022 2023 2024 2025 2026 2027 20
Slide 21: MPC Shares Outstanding
MPC Shares Outstanding 2Q21 ended with 638 million shares 3Q21 ended with 622 millions of shares million shares 652 638 622 579 4Q21 ended with 579 571 million shares 3/31/21 6/30/21 9/30/21 12/31/21 1/31/22 571 million shares as of Jan 31 21
Slide 22: Refining & Marketing Margins – Market vs. Realized
Refining & Marketing Margins – Market vs. Realized 4,500 597 4,288 Total system capture of 116%, key factors included: 4,000 3,691 Favorable inventory impacts 3,500 $ Millions Crude timing impacts 3,000 Light product margins 2,500 2,000 R&M Margin Capture R&M Margin Indicator Impact 22
Slide 23: Refining & Marketing Segment Income
Refining & Marketing Segment Income 4Q 2021 5,000 597 4,288 4,000 654 -99 3,097 39 Volume 316 Product 920 3,000 Crude -639 $ Millions -1,448 2,000 -1,331 1,000 40 881 -668 0 Blended Sweet Sour Market Other R&M Margin Operating Distribution Turnaround Other R&M Crack Differential Differential Structu
Slide 24: Refining & Marketing Segment Income
Refining & Marketing Segment Income 4Q 2021 vs. 3Q 2021 Variance Analysis 614 19 1,000 25 881 -152 800 -23 600 $ Millions 509 136 400 -27 -27 -193 Volume 28 Product 223 200 Crude 363 0 3Q 2021 Blended Sour Sweet Market Other Adjustments Operating Distribution Turnaround, 4Q 2021 Segment Crack Differ
Slide 25: Income Summary for Operations
Income Summary for Operations 2020 2021 ($MM unless otherwise noted) (a) Corporate reflects corporate costs 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q that are no longer allocated to Speedway Refining & Marketing segment income (loss) (497) (1,544) (1,569) (1,579) (598) 224 509 881 under discontinued operations Midstr
Slide 26: Reconciliation
Reconciliation Net Income Attributable to MPC to Adjusted Net Income (Loss) Attributable to MPC ($MM) 4Q21 4Q20 Net Income attributable to MPC 774 285 (a) Income taxes for adjusted earnings was calculated by applying a combined Pre-tax adjustments: federal and state statutory tax rate of 24% to the
Slide 27: Reconciliation
Reconciliation Cash Provided by Operations to Continuing Operating Cash Flow Before Changes in Working Capital 2021 ($MM) 4Q Cash provided by operating activities from continuing operations 4,838 Less changes: Current receivables (1,534) Inventories 1,173 Current accounts payable and accrued liabili
Slide 28: Reconciliation
Reconciliation Segment Income (Loss) from Operations to Segment Adjusted EBITDA and Adjusted EBITDA 2020 2021 ($MM) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Refining & Marketing Segment Segment income (loss) from operations (497) (1,544) (1,569) (1,579) (598) 224 509 881 Add: Depreciation and amortization 473 463 45
Slide 29: Reconciliation
Reconciliation Refining & Marketing Income (Loss) from Operations to Refining & Marketing Margin 2020 2021 ($MM) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q (a) LCM inventory valuation adjustments are Refining & Marketing income (loss) from operations (a) (497) (1,544) (1,569) (1,579) (598) 224 509 881 excluded from Re