Slide 1: Holly Corporation Spring / Summer 2010 Update
Holly Corporation Spring / Summer 2010 Update
Slide 2: Our Mission
Our Mission Our mission is tobe a premier U.S. petroleum refining, pipeline and terminal company as measured by superior financial performance and sustainable, profitable growth. ‘We seek to accomplish this by operating safely, reliably andin an environmentally esponsble manner, fectively tnd effici
Slide 3: Holly Corporation Disclosure Statement
3 Holly 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 and nec
Slide 4: Presentation Topics
4 Presentation Topics HOC Company Overview Financial Performance and Competitiveness Focused Growth Orientation Summary Appendix
Slide 5: Holly Investment Highlights
5 Holly Investment Highlights Pure Play Refiner 3 refineries with combined processing capacity of 256,000 barrels per day (bpd) 40 years of refining experience-entered refining business in 1969 (profitable every year) Competitive Assets High complexity facilities with access to multiple sources of c
Slide 6: Holly Overview
6 Holly Overview Holly Corporation: Holly's refineries operate in Southwest, Rockies & Mid-Continent markets 256,000 bpsd of refining capacity and weighted average complexity greater than 12.0 Refineries directly connected to Domestic or Canadian crude trading hubs Owns 100% of GP and 7.3 million LP
Slide 7: Navajo Refinery
7 Navajo Refinery Product Sales Mix (12/31/09) Overview 561 acre site located in Artesia, NM with crude capacity of 100,000 BPSD (expanded in Q1 2009) Ability to process sour crude oils into high value light products Distributes to high margin markets in Arizona, New Mexico and West Texas Nelson Com
Slide 8: Woods Cross Refinery
8 Woods Cross Refinery Product Sales Mix (12/31/09) Overview 200 acre site located in Woods Cross, UT (near Salt Lake City) with crude oil capacity of 31,000 BPD Processes regional sweet and lower cost black wax crude as well as Canadian sour crude oils Distributes to high margin markets in Utah, Id
Slide 9: Tulsa Refinery
9 Tulsa Refinery (formerly separate facilities owned by Sunoco & Sinclair) Projected Production Mix Overview Holly has begun integrating the two Tulsa facilities to form one complex 125,000 BPD refinery (full integration could take up to 18 months) Refineries are located less than 2 miles apart and
Slide 10: Presentation Topics
10 Presentation Topics HOC Company Overview Financial Performance and Competitiveness Focused Growth Orientation Summary Appendix
Slide 11: Holly Historical EBITDA
11 Holly Historical EBITDA (in millions) Capacity of 256,000 bpsd Legacy refineries (Navajo and Woods Cross) - 131 bpsd Sunoco - Tulsa Refinery acquisition - June 1, 2009 (+85 bpsd) Sinclair - Tulsa Refinery acquisition - December 1, 2009 (+40 bpsd) *Definition for non-GAAP measures such as EBITDA o
Slide 12: Refining Margins (2004-2009 range)
12 Refining Margins (2004-2009 range) 1 - Actual realized gross margin. 2 - PADD II 3-2-1 gross margin proxy for Tulsa refineries Tulsa Gulf Coast 3-2-1: 5 Yr. Avg. 2 *Definition for non-GAAP measures such as EBITDA or Margins are located on page 29. Navajo Gulf Coast 3-2-1: 5 Yr. Avg. 1 Woods Cross
Slide 13: 2009 - Gasoline & Diesel Cracks
2009 - Gasoline & Diesel Cracks 13 Diesel Diesel cracks were well below prior year and 5 year average in all markets. US demand was down over 12% (vs. 2008) Gasoline Gasoline cracks were better than 2008 in most markets while still remaining below the 5 year average. US demand was down over 1% (vs.
Slide 14: Strong Returns on Capital and Conservative Balance Sheet
14 Strong Returns on Capital and Conservative Balance Sheet 1 - As of 12/31/09. HOC standalone (excludes HEP debt) Conservative Debt Level High Returns on Invested Capital
Slide 15: Presentation Topics
15 Presentation Topics HOC Company Overview Financial Performance and Competitiveness Focused Growth Orientation Summary Appendix
Slide 16: Enhanced Competitive Position at Legacy Refineries
16 Enhanced Competitive Position at Legacy Refineries Recently Completed Refinery Enhancements Increased capacity 19% Increased lower cost black wax and Canadian crude processing from 20 to 50% Increased ULSD production percentage Enhanced black wax and Canadian heavy receiving capabilities Increase
Slide 17: Integrating the Two Tulsa Facilities
17 Holly is in process of integrating the two Tulsa facilities (formerly separate facilities owned by Sunoco & Sinclair) to form one complex 125,000 BPD refinery Net capex savings of approximately $125 million: Eliminates an estimated $110 million of project capital requirements Reduces MSAT 2 compl
Slide 18: Capital Expenditure Overview
18 Capital Expenditure Overview Past investments make legacy refineries stronger 1. Excludes HEP capex; net of contributions from UNEV JV partner; includes turnaround expenditures; excludes asset acquisitions 2. As of 3/31/09; excludes HEP capex and cash. Strong balance sheet and liquidity gong forw
Slide 19: UNEV Pipeline & Refinery Economics
19 UNEV Pipeline & Refinery Economics Overview: 75% interest in 400 mile, 12" refined products pipeline from Salt Lake City to Las Vegas with terminals in Cedar City, UT and Las Vegas, NV (Sinclair is 25% equity partner) HOC is funding construction and will own through construction phase Holly expec
Slide 20: Presentation Topics
20 Presentation Topics HOC Company Overview Financial Performance and Competitiveness Focused Growth Orientation Summary Appendix
Slide 21: Holly Corporation Contact
21 Holly Corporation (NYSE: HOC) 100 Crescent Court, Suite 1600 Dallas, Texas 75201 (214) 871-3555 Neale Hickerson, Vice President, Investor Relations Neale.hickerson@hollycorp.com 214-871-3555 www.hollycorp.com
Slide 22: Presentation Topics
22 Presentation Topics HOC Company Overview Financial Performance and Competitiveness Focused Growth Orientation Summary Appendix
Slide 23: Appendix
23 Appendix Tulsa - Sinclair Refinery Acquisition Tulsa - Sunoco Refinery Acquisition Estimated Effects of Capital Projects Balance Sheet Highlights Definitions
Slide 24: Sinclair Refinery - Transaction Summary
24 Sinclair Refinery - Transaction Summary 1Combined fully integrated capacity of Holly's existing Tulsa refinery and Sinclair's refinery is projected to be approximately 125,000 bpsd Holly has purchased Sinclair's Tulsa refinery Holly's portion of the purchase price consists of $74.0 million in Hol
Slide 25: Tulsa (Sunoco) Acquisition - Transaction Summary
25 Tulsa (Sunoco) Acquisition - Transaction Summary Asset Summary: Tulsa refinery has crude capacity of 85,000 BPSD High complexity: 11.4 Nelson complexity factor Produces high value specialty products and transportation fuels Strategic location - direct pipeline connection to Cushing crude oil hub
Slide 26: Estimated Effects of Capital Projects at Legacy Refineries
Estimated Effects of Capital Projects at Holly's Legacy Refineries Illustrative computations of impact of expansion & gross margins 26 Gross Margin/bbl Consolidated Navajo Woods Cross 2003 $7.23 $7.43 $6.10 2004 $9.20 $10.16 $6.00 2005 $12.62 $13.61 $9.62 2006 $15.78 $15.37 $17.10 2007 $16.74 $15.58
Slide 27: Estimated Effects of Capital Projects: Crude Mix Changes
27 Estimated Effects of Capital Projects at Holly's Legacy Refineries Illustrative computations of impact of crude mix changes Every +/- $1 change in net feedstock costs equals $3.65 million Every +/- $1 change in net feedstock costs equals $14.6 million All dollar values are for a full year impact
Slide 28: Balance Sheet Highlights and Liquidity
28 Balance Sheet Highlights and Liquidity 2010 Events: Mar 2010: HEP executed a debt offering of $150 million of senior notes to purchase storage and loading facilities from Holly Corporation for $93 mm. The purchase of the storage and loading facilities was completed on March 31, 2010. Other: HEP h
Slide 29: Definitions
29 Definitions BPD: the number of barrels per calendar day of crude oil or petroleum products. BPSD: the number of barrels per stream day of crude oil or petroleum products. EBITDA: Earnings before interest, taxes, depreciation and amortization, which we refer to as EBITDA, is calculated as net inco