Hf Sinclair Corporation · NYSE:DINO
Hf Sinclair — HollyFrontier — Howard Weil Energy Conference 2012
27 slides from Hf Sinclair's conference presentation, Mar 26, 2012
Slide 1: HollyFrontier Corporation Howard Weil Energy Conference
HollyFrontier Corporation Howard Weil Energy Conference New Orleans, LA March 2012
Slide 2: Slide 2
Slide 3: Disclosure Statement
3 HollyFrontier Corporation Disclosure Statement Statements made during the course of this presentation that are not historical facts are “forward- looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently uncertain
Slide 4: HollyFrontier Corporation
4 HollyFrontier Corporation
Slide 5: HollyFrontier Investment Highlights
HollyFrontier Investment Highlights Pure Play Competitive Refiner 5 refineries with combined processing capacity of over 440,000 barrels per day (bpd) High complexity facilities with access to multiple sources of crude supply—combined Nelson Complexity rating of over 12.0 High degree of crude
Slide 6: Footprint of HollyFrontier and HEP
Footprint of HollyFrontier and HEP Collaboration with HEP provides strategic growth opportunities in logistics and marketing operations 6
Slide 7: Proximity to Growing North American Crude Production
Proximity to Growing North American Crude Production Refineries are well-positioned for exposure to the growing supply of lower cost domestic and Canadian crude oil 7
Slide 8: UNEV Pipeline & Woods Cross Refinery Economics
UNEV Pipeline & Woods Cross Refinery Economics Overview: 400 mile, 12” refined products pipeline from Salt Lake City to Las Vegas with terminals in Cedar City, UT and Las Vegas, NV HollyFrontier owns 75% interest (Sinclair 25%) Start up — January 2012 Benefits: Las Vegas gasoline trades seas
Slide 9: Crude Growth in our "Backyard"
Crude Growth in our “Backyard” Canadian, Bakken, Permian, Niobrara, Uinta, Mississippian 9 K b /d Source: Deutsche Bank, Macquarie, Simmons & Co, Canadian Association of Petroleum Producers, North Dakota Pipeline Authority, and the EIA. 6.9 MB/d 4.4 Mb/d
Slide 10: Strategic Investment & Acquisition
Strategic Investment & Acquisition Historical Investments Approximately $600mm invested for enhanced feedstock flexibility & modest growth Synergistic acquisitions of Tulsa refineries at less than $1,000 per daily bbl* Tulsa interconnection improving profitability through better yields & lower
Slide 11: Capital Expenditure Overview
Capital Expenditure Overview Legacy HOC and FTO capital expenditures were combined for periods prior to the 2011 merger. 2011 capital expenditure calculated using 2011 HFC capital expenditure of $374m plus FTO capital expenditure of $42.4m for 2011 period prior to the merger. Does not include capita
Slide 12: Cash Returns to Shareholders
Cash Returns to Shareholders Since the July 2011 merger we have declared $375m in cash distributions: Increased our regular dividend twice • Aug 25th: Raised regular quarterly cash dividend from $0.075 to $0.0875 per share, a 14% increase • Nov 16th: Raised regular quarterly cash dividend from $0.
Slide 13: Cash Returns to Shareholders: LTM Cash Yield
Cash Returns to Shareholders LTM Cash Yield to Shareholders *Companies who have announced share repurchases YTD 2012 Last Twelve Months includes YTD 2012 dividends declared and excludes Q1 2011 cash dividends. Data from filings and press releases. As of 3/22/2012 stock prices. See page 26 for calcul
Slide 14: Pro Forma HollyFrontier Returns on Capital
Pro Forma HollyFrontier Returns on Capital (combined) Returns on Invested Capital (Average: 2007-2011)* *5-year average ROIC calculated by taking the average of ROIC’s for the years 2007-2011. ROIC calculated by dividing net income by the sum of total debt and total equity. For HFC, legacy HOC/FTO e
Slide 15: HFC Balance Sheet Highlights and Liquidity
HFC Balance Sheet Highlights and Liquidity (as of 12/31/11) 1 – Includes cash & cash equivalents & marketable securities (short-term & long-term). Excludes HEP cash of $3.269 million. 2 – Does not include HEP long-term debt, which is non-recourse to HFC. ( $in millions) Cash & equivalents, marketabl
Slide 16: Strong Financial Metrics vs Peers
Strong Financial Metrics vs Peers Net Income per Barrel of Crude Capacity HFC earnings per bbl strongest in peer sector HFC earnings calculated by adding legacy HOC plus FTO earnings for periods prior to the merger. See page 26 for calculations. 16
Slide 17: HEP Growth: Distributable Cash Flow Since Inception
HEP Growth: Distributable Cash Flow Since Inception HFC received $46m in cash distributions for FY 2011 17
Slide 18: Value of HFC's LP & GP Interests in HEP
Value of HFC’s LP & GP Interests in HEP HFC owns 11.1mm common units: $640 -- 680MM1 Multiple of GP cash flow: 15X 20X 25X Current GP Interest IDR Distributions:2 $300MM $400MM $500MM HEP value to HFC is in the approximate $940 million to $1.1 billion range.3 1 Based on range of $58 to $62 per unit
Slide 19: HollyFrontier Corporation Contact
HollyFrontier Corporation (NYSE: HFC) 2828 N. Harwood, Suite 1300 Dallas, Texas 75201 (214) 871-3555 Neale Hickerson, Vice President, Investor Relations Neale.hickerson@hollyfrontier.com 214-871-3572 Julia Heidenreich, Investor Relations Julia.Heidenreich@hollyfrontier.com 214-871-3422 www.hollyfron
Slide 20: Appendix
HOLLYFRONTIER Appendix
Slide 21: Mid-Continent: El Dorado & Tulsa Refineries
Mid-Continent: El Dorado & Tulsa Refineries TULSA REFINERIES EL DORADO REFINERY The Mid-Continent Region comprises our Tulsa and El Dorado Refineries and has a combined crude oil processing capacity of 260,000 BPSD. Product Mix Gasolines, 46% Diesel fuels, 32% Jet fuels, 7% Asphalt, 4% Lubricants, 4
Slide 22: Southwest: Navajo Refinery
Southwest: Navajo Refinery NAVAJO REFINERY The Southwest Region consists of our Navajo Refinery and has a crude oil processing capacity of 100,000 BPSD. In addition, we manufacture and market commodity and modified asphalt products through the Southwest Region. Southwest Sales of Refinery Produced P
Slide 23: Rocky Mountain: Woods Cross and Cheyenne Refineries
Rocky Mountain: Woods Cross and Cheyenne Refineries CHEYENNE REFINERY The Rocky Mountain Region comprises of our Cheyenne and Woods Cross Refineries and has a combined crude oil processing capacity of 83,000 BPSD. We also own a 75% joint venture interest in the recently completed UNEV pipeline, a 40
Slide 24: Holly Energy Partners
Holly Energy Partners HEP PRODUCTS Holly Energy Partners owns and operates substantially all of the refined product pipeline and terminalling assets that support our refining and marketing operations in the Mid- Continent, Southwest and Rocky Mountain regions of the United States. • 2,500 miles of c
Slide 25: Feedstock Flexibility
Feedstock Flexibility* 25 *Please note these are current and estimated maximum crude rates and are subject to change based on a variety of factors. • High WTI/WTS ($3 or higher) • Low WTI/WCS ($8 or less) • WTI/Brent Range ($10 to $20) • Low WTI/WTS ($2 or less) • High WTI/WCS ($20 or higher) • WTI/
Slide 26: Financial metrics
Financial metrics* * Holly debt excludes HEP debt; All amounts are based on publicly-available financial statements, which we have assumed to be accurate. 26 HOLLYFRONTIER 2011 2010 2009 2008 2007 5-Yr Ave ROIC Net Income $ 1,330.2 $ 141.6 $ (65.0) $ 347.0 $ 736.1 Total Debt EX HEP $ 1,036.8 $ 674.8
Slide 27: Definitions
Definitions Non GAPP measurements: We report certain financial measures that are not prescribed or authorized by U. S. generally accepted accounting principles ("GAAP"). We discuss management's reasons for reporting these non-GAAP measures below. Although management evaluates and presents these non-