Marathon Petroleum Corporation · NYSE:MPC
Marathon Petroleum — Q4 2023 Earnings Presentation
29 slides from Marathon Petroleum's earnings presentation, Jan 30, 2024
Slide 1: Fourth Quarter 2023 Earnings Conference Call
Fourth Quarter 2023 Earnings Conference Call January 30, 2024 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements regarding MPC. These forward-looking statements may relate to, among other things, MPC’s expectations, estimates and projections concerning its business and operations, financial priorities, strategic plans and initiati
Slide 3: Delivering on Our Commitments in 2023
Delivering on Our Commitments in 2023 Strong Commercial Superior Performance Execution Returns $12.74 R&M Segment 100% Strong $11.6B of Share EBITDA Per Barrel Full-Year Capture Repurchases in 2023 $14B of Cash Flow Continued Commercial 10% Increase to from Operations Improvement and Execution MPC D
Slide 4: 2024 Financial Priorities
2024 Financial Priorities 1 Sustaining Capital Maintain safety, integrity, and reliability of our assets 2 Dividends Secure, competitive, and growing dividend 3 Growth Capital Disciplined growth opportunities, including low-carbon 4 Share Repurchases Steadfast commitment to return capital to shareho
Slide 5: Return of Capital Execution
Return of Capital Execution Repurchased ~300 million shares for ~$29 billion at average price of $97(a), reducing shares outstanding by ~45% millions of shares outstanding 652 579 454 363 3/31/21 12/31/21 12/31/22 1/26/2024 Note: The respective share counts reflect net shares outstanding (in million
Slide 6: Financial Discipline: 2024 Capital Outlook
Financial Discipline: 2024 Capital Outlook 2024 Low Carbon ~40% 2023 $ Millions Outlook of Growth Capital Refining & Marketing 1,311 1,200 Growth – Traditional 506 475 Growth – Low Carbon (a) 491 350 R&M R&M Maintenance 314 375 Growth Maintenance MPC Midstream 2 - Corporate/Other (b) 83 50 MPC Total
Slide 7: 2024 Capital Spending
2024 Capital Spending MPC Standalone (Excluding MPLX) 2,505 Sustaining and Growth Capital Continued focus on strict capital discipline; spending remains 50% below 2019 levels 1,624 $ Millions 1,471 1,396 Sustaining capital underpins safety 1,250 1,066 and environmental 2024 capex focused on co
Slide 8: Los Angeles Efficiency and Modernization Improvements
Los Angeles Efficiency and Modernization Improvements Further enhances competitiveness by improving reliability and lowering costs Integrates and modernizes utility systems Increases energy efficiency and reduces opex Reduces GHG emissions (Scope 1 and 2) Addresses NOx emissions reduction re
Slide 9: Galveston Bay Distillate Hydrotreater Project
Galveston Bay Distillate Hydrotreater Project Further strengthens GBR’s competitiveness by improving the ability to produce higher-value finished product Upgrade high-sulfur distillate to ULSD Eliminate reliance on lower-value high-sulfur markets Improves USGC value chain Target completion Y
Slide 10: Challenging Ourselves to Lead in Sustainable Energy
Challenging Ourselves to Lead in Sustainable Energy STRENGTHEN RESILIENCY INNOVATE FOR THE FUTURE EMBED SUSTAINABILITY Dickinson, North Dakota – Renewable Diesel Facility Scope 1 & 2 GHG Intensity 20% of annual cash bonus program 30% Target: 30% reduction by 2030 from 184 million gallons/ Processing
Slide 11: Fourth Quarter Highlights
Fourth Quarter Highlights $ Millions (unless otherwise noted) 4Q23 FY23 Adjusted Earnings per Share ($/share)(a)(b) $3.98 $23.63 Adjusted EBITDA(b) $3,528 $18,985 Cash Flow from Operations, excl. changes in working capital(b) $2,258 $13,887 Share Repurchases(c) $2,505 $11,572 Dividends $311 $1,261 (
Slide 12: Adjusted EBITDA to Net Income, 4Q 2023 vs. 3Q 2023
Adjusted EBITDA to Net Income 4Q 2023 vs. 3Q 2023 Adjusted EBITDA Reconciliation to Net Income 6,000 5,708 4,000 31 0 3,528 $ Millions -2,211 -6 2,000 -1,127 1,451 -944 0 3Q 2023 Refining & Midstream Corporate 4Q 2023 Adjustments Turnaround Interest, 4Q 2023 Adj. EBITDA Marketing Adj. EBITDA (a) and
Slide 13: Refining & Marketing 4Q 2023 vs. 3Q 2023
Refining & Marketing 4Q 2023 vs. 3Q 2023 5,000 91% utilization 4,373 4,000 -511 122% capture 3,000 $ Millions -963 Continued 131 2,162 commercial 2,000 -704 -127 -37 execution 1,000 0 3Q 2023 USGC Mid-Con West Coast Operating Distribution Other 4Q 2023 Segment Margin Margin Margin Costs Costs
Slide 14: Refining & Marketing Margins – Market vs. Realized
Refining & Marketing Margins – Market vs. Realized 6,000 Total system capture(a) of 122%; key 885 4,944 factors included: 5,000 Solid commercial execution 4,059 122% $ Millions 4,000 Light product margin tailwinds 100% 3,000 More favorable relative pricing of secondary products 2,000 R&M Margi
Slide 15: Midstream 4Q 2023 vs. 3Q 2023
Midstream 4Q 2023 vs. 3Q 2023 24 7 1,570 1,539 1,500 Segment Adj. EBITDA up ~2% sequentially; up ~7% full year over prior year 1,000 $ Millions $2.2B distribution to MPC annually at current level 500 Continued focus on disciplined, high-return projects 0 3Q 2023 MPLX Other 4Q 2023 Segment Mids
Slide 16: Total Consolidated Cash Flow 4Q 2023
Total Consolidated Cash Flow 4Q 2023 2,258 15,000 -1,135 13,056 95 -896 -338 -311 $ Millions Incl. Acquisition of JV by MPLX 10,224 10,000 -2,505 5,000 9/30/2023 Cash Flow Changes in Capital Return of Other Dividends Share 12/31/2023 Cash + from Operations, Working Capital Expenditures, Capital to R
Slide 17: First-Quarter 2024 Outlook
First-Quarter 2024 Outlook Other Charge/ Total Operating Distribution Depreciation Crude Sweet Sour Turnaround Utilization (a) Blendstocks Throughput Cost Cost and Throughput Crude Crude Costs Throughput (a) (b) (c) Amortization (a) $/BBL of Total in MBPD (except Utilization) Percent of Throughput $
Slide 18: Superior Cash Flow Generation Accomplishments Since 2020
Superior Cash Flow Generation Accomplishments Since 2020 Support Strong Cash Flow Strengthen Competitive Position $2.2 Billion of our Assets $29 Billion of Distribution from MPLX Shares Repurchased Annually, Up ~25% Foster Low-Cost from 2020 Culture ~$10 Billion of ~45% Reduction Improve Disciplined
Slide 19: Questions & Answers
Questions & Answers
Slide 20: Appendix
Appendix 20
Slide 21: Balance Sheet: Foundation for Strategy Execution
Balance Sheet: Foundation for Strategy Execution MPC Senior Notes Maturities - Next 10 Years (a) 3.0 MPC Excluding MPLX MPC As of December 31, 2023 MPLX Adjustments (c) Consolidated $ Billions 2.0 ($ Millions except ratio data) Cash(d) 9,176 1,048 10,224 1.0 Total Debt 6,852 20,431 27,283 0.0 2024 2
Slide 22: Refining & Marketing Segment Adjusted EBITDA 4Q 2023
Refining & Marketing Segment Adjusted EBITDA 4Q 2023 885 4,944 702 4,000 -109 168 3,298 Volume + 352 -1,528 $ Millions Product + 1,132 Crude - 599 264 2,162 2,000 -1,518 0 Blended Sweet Sour Market Other R&M Margin, Operating Distribution Other R&M Crack Differential Differential Structure Margin ex
Slide 23: Refining & Marketing Segment Adjusted EBITDA Variance Analysis
Refining & Marketing Segment Adjusted EBITDA 4Q 2023 vs. 3Q 2023 Variance Analysis 4,373 4,000 Volume - 54 Product + 1,301 $ Millions Crude + 148 1,395 131 2,162 2,000 -127 -37 240 76 -81 -3,808 0 3Q 2023 Blended Sour Sweet Market Other Operating Distribution Other 4Q 2023 Segment Crack Differential
Slide 24: Income Summary for Operations
Income Summary for Operations 2022 2023 ($MM unless otherwise noted) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Refining & Marketing segment income 768 7,134 4,625 3,910 3,032 2,287 3,757 1,242 Midstream segment income 1,072 1,126 1,176 1,088 1,213 1,201 1,136 1,285 Corporate (151) (170) (173) (259) (184) (183) (246)
Slide 25: Reconciliation
Reconciliation Net Income Attributable to MPC to Adjusted Net Income Attributable to MPC ($MM) 4Q23 4Q22 (a) Income taxes for adjusted earnings were calculated by applying a combined Net income attributable to MPC 1,451 3,321 federal and state statutory tax rate of 22% to the pre-tax adjustments. Th
Slide 26: Reconciliation
Reconciliation Cash Flow from Operations, Excluding Changes in Working Capital 2023 ($MM) 4Q FY 2023 Cash provided by operating activities 1,123 14,117 Less changes: Current receivables 896 1,972 Inventories 824 (489) Current accounts payable and accrued liabilities (2,881) (1,316) Fair value of der
Slide 27: Reconciliation
Reconciliation Segment Income from Operations to Segment Adjusted EBITDA and Adjusted EBITDA 2022 2023 ($MM) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Refining & Marketing Segment Segment income from operations 768 7,134 4,625 3,910 3,032 2,287 3,757 1,242 Add: Depreciation and amortization 461 475 459 455 464 484 46
Slide 28: Reconciliation
Reconciliation Net Income Attributable to MPC to Adjusted EBITDA 2022 2023 ($MM) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Net income attributable to MPC 845 5,873 4,477 3,321 2,724 2,226 3,280 1,451 Net income attributable to noncontrolling interest 327 344 543 320 360 354 351 426 Income from discontinued operations
Slide 29: Reconciliation
Reconciliation Refining & Marketing Segment Adjusted EBITDA to Refining & Marketing Margin 2022 2023 ($MM) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Refining & Marketing segment adjusted EBITDA 1,374 7,760 5,496 4,631 3,853 3,163 4,373 2,162 Plus (Less): (a) Reflects the gross margin, excluding Depreciation and amort