Par Pacific Holdings, Inc. Common Stock · NYSE:PARR
Par Pacific Holdings, Inc. Common Stock — Investor Presentation (August 2018)
32 slides from Par Pacific Holdings, Inc. Common Stock's investor presentation, Aug 8, 2018
Slide 1: Investor Presentation August 2018
Investor Presentation August 2018
Slide 2: Forward-Looking Statements / Disclaimers
Forward-Looking Statements / Disclaimers The information contained in this presentation has been prepared to assist you in making your own evaluation of the company and does not purport to contain all of the information you may consider important. Any estimates or projections with respect to future
Slide 3: Our Business Platforms
Our Business Platforms Refining Hawaii Refinery Wyoming Refinery ▪ 94,000 bpd refinery ▪ 18,000 bpd refinery ▪ 50% distillate yield configuration ▪ 95% light products yield ▪ Crudes sourced globally ▪ Tailored for Powder River Basin & Bakken crude Logistics Hawaii Logistics Wyoming Logistics ▪ Stora
Slide 4: Corporate Strategy
Corporate Strategy Grow Existing Acquire Similar Maintain Diverse Leverage Tax Businesses Businesses Earnings Profile Attributes ▪ Bolt-on acquisitions ▪ Energy and ▪ Decrease commodity ▪ infrastructure price volatility Selective capital business in niche ▪ projects markets Enhance credit profile ▪
Slide 5: Financial Summary
Financial Summary Free Cash Flow ($MM) (1) LTM Adjusted Net Income ($MM) (2) Enterprise Value ($MM) (3) Net Debt to Total Capitalization (4) Closing Share Price $17.26 Shares Outstanding 45.9 Market Capitalization $792 Principal Amount of Debt $415 Cash $83 Net Debt $332 Total Enterprise Value $1,12
Slide 6: Business Segment Profile
Business Segment Profile Retail and Logistics contributed 40% of LTM Q2 2018 Adjusted EBITDA (1) ($ in millions) Adjusted EBITDA LTM Q2 2018 Refining 113 Logistics 41 Retail 33 Corporate & Other -46 Total Adjusted EBITDA 141 E&P diversification with 39.1% ownership of Laramie Energy ▪ Targeting free
Slide 7: Hawaii Refinery Asset Highlights
Hawaii Refinery Asset Highlights ▪ Largest and most complex in-state refinery ▪ Distillate yield configured for Hawaii demand ▪ $27MM diesel hydrotreater project anticipated to increase distillate production 5-7Mbpd; estimated completion 4Q 2019 ▪ Asset location and configuration favorably positione
Slide 8: Hawaii Business Strategy
Hawaii Business Strategy At Acquisition: September 2013 60,000 BPD throughput Creative working 45,000 BPD on-island sales capital solution 35% fuel oil yield Middle East crude slate Mid Pac acquisition $5.00/bbl production cost increased on-island sales Aggressive in-state commercial strategy Improv
Slide 9: Wyoming Refinery Asset Highlights
Wyoming Refinery Asset Highlights ▪ 18,000 bpd refinery in Newcastle, Wyoming ▪ Complex refinery with a Nelson Complexity Index of 10.7 ▪ Flexible product yield ▪ Attractive light products yield over 95% during YTD 2018 YTD 2018 Crude Sourcing YTD 2018 Yield Profile (1) Asset Detail Refining Unit Ca
Slide 10: Wyoming Business Strategy
Wyoming Business Strategy Acquisition: July 2016 15,200 BPD throughput Upgrade diesel 41% distillate yield hydrotreater to increase distillate production Establish out of market commercial strategy Refined products transported by rail Added Economic and Planning group 2019 Goals: Expanded commercial
Slide 11: Logistics Segment
A ® Par Pacific Logistics Segment
Slide 12: Hawaii Logistics Asset Highlights
Hawaii Logistics Asset Highlights Hawaii Assets Map North America ▪ Integrated system enhances flexibility and profitability ▪ Difficult to replicate asset base ▪ Multiple advantages from single point mooring ▪ Latin America Increased safety and flexibility South America ▪ Enhanced distribution capa
Slide 13: Wyoming Logistics
Wyoming Logistics Logistics Assets ▪ 140-mile crude oil pipeline gathering system providing direct access to Powder River Basin crude ▪ 40-mile products pipeline feeds into Magellan Products Line en route to Rapid City, South Dakota ▪ Jet fuel terminal in Rapid City and pipeline connecting to the El
Slide 14: Retail Segment
A ® Par Pacific Retail Segment
Slide 15: Hawaii Retail Highlights
Hawaii Retail Highlights ▪ Extensive footprint across four islands in Hawaii ▪ Strong financial performance throughout 2017 and YTD 2018 ▪ New location expected to open in 2018 Retail Network High real estate costs, scarcity of land, and logistics complexity strengthen competitive position 15
Slide 16: Northwest Retail
Northwest Retail Significant Presence in Niche Market • 33 Cenex® Zip Trip branded convenience stores • 21 fee-owned sites • 30 sites recently remodeled / upgraded • Strategic multi-year fuel supply and Cenex® branded agreements Asset Highlights • Second largest branded retail position in Spokane re
Slide 17: Laramie Energy
A ® Par Pacific Laramie Energy
Slide 18: Laramie Energy Asset Highlights
Laramie Energy Asset Highlights Production Profile (2) ▪ Par Pacific owns 39.1% of Laramie Energy, LLC ▪ 55% of existing gas production hedged through December 2018 (1) ▪ Southern acreage – targeting EURs of approximately 1.7 Bcfe with drilling and completion costs of approximately $0.95 MM per well
Slide 19: Appendix
A ® Par Pacific Appendix
Slide 20: Hawaii Market Fundamentals
Hawaii Market Fundamentals Refined Product Demand (1) Electricity Production by Source and Petroleum Use (2) MBbl/d Total Production Total Demand 80 70 72 61 64 60 56 51 48 40 32 24 16 8 0 Other Products Distillate Shortage of distillate capacity in Hawaii Fuel oil utilized for ~70% of electricity g
Slide 21: Mid Pacific Crack Spread and Crude Differential
Mid Pacific Crack Spread and Crude Differential 5YR Combined Average (1) = $8.19 ($/bbl) Mid Pacific 4.1.2.1 $7.93 $6.50 $4.48 $3.96 $4.45 $7.00 $7.69 $8.35 $9.94 $7.81 $7.38 $7.71 Mid Pacific Crude Blend -$0.56 -$1.75 -$2.10 -$2.04 -$2.42 -$1.48 -$1.21 -$0.61 -$0.33 -$0.02 -$0.02 -$0.42 Combined Di
Slide 22: Wyoming Crack Spread
Wyoming Crack Spread 4YR Average (1) = $20.66 ($/bbl) Wyoming 3.2.1 $32.51 $19.03 $13.44 $18.16 $19.12 $13.69 $16.51 $21.47 $25.29 $23.79 $15.65 $24.99 WTI $46.43 $42.18 $33.45 $45.59 $44.91 $49.34 $51.93 $48.30 $48.21 $55.40 $62.89 $67.90 ____________________ (1) Company calculation based on a roll
Slide 23: Capital Expenditures Summary
Capital Expenditures Summary ▪ Annual base maintenance capital expenditures of $25-30MM Maintenance / ▪ Regulatory 2018 estimates include non-recurring maintenance and regulatory capital related to Wyoming Refinery and Logistics ▪ Distillate hydrotreater project in Hawaii accounts for $15MM of growt
Slide 24: Corporate Structure
Corporate Structure $115 MM 5% Convertible Par Pacific Holdings Inc. Notes due 6/15/2021 NYSE: PARR $85 MM ABL Revolver (1) Due 12/21/2022 Par Petroleum, LLC $300 MM 7.75% Senior Secured Notes due 12/15/2025 Hermes Consolidated, LLC Laramie Energy, LLC (2) Supply and Offtake Par Hawaii Refining, LLC
Slide 25: Laramie Energy Hedging Program
Laramie Energy Hedging Program ____________________ Note: Hedging program as of 7/31/2018. 25
Slide 26: Laramie Energy Reserves
Laramie Energy Reserves Year End 2017 Reserves and PV10 Summary – 100% of Laramie Energy Strip Pricing Summary Note: Par Pacific Holdings owned 42.3% of Laramie Energy, LLC as of 12/31/2017. Par Pacific Holdings currently owns 39.1%. Reserve information based on year end 2017 reserve report of Nethe
Slide 27: Laramie Key Statistics
Laramie Key Statistics ____________________ (1) Laramie Debt is non-recourse to Par Pacific and solely guaranteed by a Par Pacific subsidiary that owns Laramie Energy units. (2) Preferred stock balance based on current Liquidation Preference amount. (3) Par Pacific ownership of Laramie Energy decrea
Slide 28: Laramie Energy Adjusted EBITDAX
Laramie Energy Adjusted EBITDAX Three Months Ended ($ in thousands) June 30, June 30, 2018 2017 Net (loss) income (8,846) 2,413 Commodity derivative gains 4,930 (6,503) (Gain) loss on settled derivative instruments 3,135 (2,144) Interest expense 2,225 1,278 Non-cash preferred dividend 1,151 1,022 De
Slide 29: Non-GAAP PV10 and PV20 Disclosure
Non-GAAP PV10 and PV20 Disclosure Non-GAAP PV10 and PV20 Disclosure PV10 and PV20 are considered non-GAAP financial measures under SEC regulations because they do not include the effects of future income taxes, as is required in computing the standardized measure of discounted future net cash flows.
Slide 30: Non-GAAP Financial Measures: LTM Adjusted EBITDA and Net Income
Non-GAAP Financial Measures Last Twelve Months Consolidated Adjusted EBITDA and Adjusted Net Income (Loss) Reconciliation (1) ($ in thousands) Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Net income (loss) $ (126,358) $ (45,835) $ 624 $ 20,718 $ 67,303 $ 72,621 $ 60,020 $ 69,192 A
Slide 31: Non-GAAP Financial Measures: Adjusted EBITDA by Segment
Non-GAAP Financial Measures Consolidated Adjusted EBITDA by Segment Reconciliation (1) For the twelve months ended June 30, 2018 ($ in thousands) Corporate and Refining Logistics Retail Other Operating income (loss) $ 98,110 $ 34,600 $ 25,179 $ (51,479) Adjustments to operating income (loss): Unreal
Slide 32: Non-GAAP Financial Measures: Consolidated Free Cash Flow
Non-GAAP Financial Measures Consolidated Free Cash Flow (1) ($ in thousands) 2016 2017 2018 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Cash provided by (used in) operations (2) $ (12,442) $ 17,357 $ 24,995 $ 37,202 $ 43,259 $ 1,027 $ 12,641 $ 18,686 Less: Capital Expenditures 7,585 5,557 7,579 4,198 8,111 11,820 9,612
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