Murphy Usa Inc. · NYSE:MUSA
Murphy Usa — Raymond James Institutional Investors Conference 2023
19 slides from Murphy Usa's conference presentation, Mar 6, 2023
Slide 1: Raymond James Institutional Investor Conference
Raymond James Institutional Investor Conference March 2023 Murphy USA Inc. 1
Slide 2: Cautionary statement
Cautionary statement This presentation contains forward-looking statements. These statements, which express management’s current views concerning future events or results, are subject to inherent risks and uncertainties. Factors that could cause actual results to differ materially from those express
Slide 3: Significant shareholder returns since 2013 Spin
Significant shareholder returns since 2013 Spin Executed long-term strategy Cumulative Shareholder Returns • Unit growth, format evolution, and network As of 12/31/2022 improvements grew adjusted EBITDA 620% • Improved breakeven economics enhanced competitiveness/attractiveness of EDLP offer • Disci
Slide 4: Credible track record underpins next decade of value creation
Credible track record underpins next decade of value creation Past Decade Proof Points Value Creation Drivers Next Decade Objectives • Added 500+ new stores to the network • Add 40 to 50 new stores per annum • Razed & Rebuilt 177 stores Organic • Improve network with Raze and Rebuilds, • Acquired Fo
Slide 5: Industry structure reflects marginal retailer economics
Industry structure reflects marginal retailer economics NACS Bottom Half(1) Cost Structure and Profitability Marginal Player Cost Structure Economics Cents per Gallon (cpg), Same Firm Data from 2007 through 2022 Impact of Relative Pressure on Marginal Retailer Operating Profit Facilities Payment Fee
Slide 6: Weakest retailers face a vicious cycle – yet persist
Weakest retailers face a vicious cycle – yet persist Higher costs impact profitability • Inflation and wage increases driving up OpEx, Vicious Cycle of the Marginal particularly for the marginal player Convenience Store Retailer • Cost structures up 9¢ since 2007 for NACS Bottom Half • Undifferentia
Slide 7: Performance gap widening in fragmented industry
Performance gap widening in fragmented industry Single-store operators fragment industry Unique Focus and Outcome • Single-store operators make up 60.2% of c- stores, down slightly from 62.1% in 2019 Single Store Operators • Single store units increased 1.2% in 2023 following multi-year decline, sug
Slide 8: MUSA’s relative advantage expanding
MUSA’s relative advantage expanding MUSA cost structure advantage sustained MUSA and Industry Cost Structure Comparison Cents per Gallon (cpg) despite industry pressures NACS Bottom Half MUSA Facilities 45 • Over 3-cpg improvement to fuel breakeven Marginal Player MUSA Payment Fees 40 since spin, ac
Slide 9: Strategic investments enabled 2022 results and future growth
Strategic investments enabled 2022 results and future growth Growing, evolving and improving network Unit Growth by Year • Organic growth investments added nearly 500 units over last decade Up to 45 • Razed & Rebuilt ~20% of legacy kiosks, 36 Up to converting each to a 1,400 square foot store, 33 32
Slide 10: Organic growth investments drive future EBITDA
Organic growth investments drive future EBITDA New store fundamentals remain strong Murphy NTI Performance 2022 Actuals • APSM volumes of 282k are 13% higher than 13% 7% network average 282 189 • Merchandise sales are 7% higher vs network average—while still in ramp mode 244 175 • Improvement initia
Slide 11: Capability investments improve core and new stores
Capability investments improve core and new stores Campaign Element From To Murphy In-Store Static layout with limited upsell Innovative in-store design to Store Layout improve product affinities (e.g., Experience and basket building potential queuing lines) National, standard offer with Market leve
Slide 12: Disciplined capital allocation supports long-term value
Disciplined capital allocation supports long-term value Strategy delivers excess FCF supporting Cash Flow and Use by Year 995 balanced capital allocation 806 737 • Cash flows growing faster than capex needs • High-quality organic growth takes time to 564 ramp efficiently 399 400 355 313 306 • Period
Slide 13: Macro trends benefit MUSA at micro level
Macro trends benefit MUSA at micro level Energy transition will impact select BEV % of Registered Vehicles markets at varying rates By state and ZEV Program Participation • EV’s—and, in particular, BEV’s—remain a 2.0% ZEV States very small part of vehicle fleet indexing to MUSA States more affluent
Slide 14: Sustainable growth underpinned by five pillars
Sustainable growth underpinned by five pillars Affordability and trust builds enduring relevance with Customers AFFORDABLE Serve customers with everyday low prices for the • Win and keep customers through EDLP fuels, merchandise and food and beverage products they need • Protect customer data throug
Slide 15: Continually raising the bar
Continually raising the bar MUSA High and Low Closing Share Price with Annual Raising the Bar…Again Average by Year Since Spin 5-year view As of 2/28/2023 $380 2027 2023 Target High $330 $318 Avg EBITDA $900 ~$1,200 Low (M) $280 $280 $266 Shares $249 $254 21.7 17.7 (M)(1) $230 $199 Multiple 9-10 10
Slide 16: Appendix
Appendix Murphy USA Inc. 16
Slide 17: 2023 guidance
2023 guidance 2022 Updated 2022 Actual Results 2023 Guidance Range Guidance Range Organic Growth New Stores Up to 45 36 Up to 45 Raze and Rebuilds Up to 35 32 Up to 30 Fuel Contribution Retail fuel volume per store (K gallons APSM) 235 to 245 245 240 to 245 Store Profitability Merchandise contributi
Slide 18: Non-GAAP adjusted EBITDA reconciliation
Non-GAAP adjusted EBITDA reconciliation Year Ended December 31, (Millions of dollars) 2018 2019 2020 2021 2022 Net Income $ 213.6 $ 154.8 $ 386.1 $ 396.9 $ 672.9 Income taxes 60.3 47.6 123.0 125.0 210.9 Interest expense, net of interest income 51.4 51.7 50.2 82.3 82.3 Depreciation and amortization 1
Slide 19: Non-GAAP Adjusted EBITDA Reconciliation
Non-GAAP Adjusted EBITDA Reconciliation 2023 and 2027 – GAAP to non-GAAP Reconciliation Calendar Year Calendar Year (Millions of dollars) 2023 2027 Target Net Income $420 $623 Income taxes $140 $210 Interest expense, net of interest income $98 $85 Depreciation and amortization $239 $280 Other operat
Murphy USA — Raymond James Institutional Investors Conference 2023 on 6ix