Marathon Petroleum Corporation · NYSE:MPC
Marathon Petroleum — Q4 2016 Earnings Presentation
24 slides from Marathon Petroleum's earnings presentation, Feb 1, 2017
Slide 1: Fourth-Quarter 2016 Earnings Conference Call and Webcast
Fourth-Quarter 2016 Earnings Conference Call and Webcast February 1, 2017
Slide 2: Forward-Looking Statements
Forward‐Looking Statements This presentation contains forward-looking statements within the meaning of federal securities laws regarding Marathon Petroleum Corporation ("MPC") and MPLX LP ("MPLX"). These forward-looking statements relate to, among other things, expectations, estimates and projection
Slide 3: Highlights
Highlights Reported fourth-quarter earnings of $227 million, or $0.43 per diluted share; full-year earnings of $1.17 billion, or $2.21 per diluted share Speedway achieved record full-year segment results Announced 2017 capital investment plan focused on growth and margin- enhancing investments
Slide 4: 4Q and Full-Year 2016 Earnings
4Q and Full-Year 2016 Earnings* 4Q 2016 4Q 2015 2016 2015 Earnings* $227 MM $187 MM $1,174 MM $2,852MM Earnings per Diluted Share** $0.43 $0.35 $2.21 $5.26 Earnings* Earnings per Diluted Share** 3,000 $2,852 6 187 $5.26 2,500 5 0.35 948 2,000 4 1.76 $/Share $MM 1,500 $1,174 3 $2.21 826 1.51 1,000 22
Slide 5: Earnings: 4Q 2016 vs. 4Q 2015 Variance Analysis
Earnings* 4Q 2016 vs. 4Q 2015 Variance Analysis 500 151 400 (6) (33) 300 (61) 30 227 $MM 40 200 187 (81) 100 0 4Q 2015 Refining & Speedway** Midstream*** Items not Interest and Income Noncontrolling 4Q 2016 Marketing** Allocated to Other Financing Taxes** Interests Segments Costs *Earnings refer to
Slide 6: Refining & Marketing Segment Income: 4Q 2016 vs. 4Q 2015
Refining & Marketing Segment Income 4Q 2016 vs. 4Q 2015 Variance Analysis 800 345 600 $MM 400 26 47 105 (25) (4) (397) 13 219 200 179 (70) 0 *4Q 2015 **LLS **Sweet/ **LLS/WTI **LLS **Market Lower of Other Direct Other 4Q 2016 6-3-2-1 Sour Diff. Diff. Prompt Structure Cost or Gross Operating Crack vs
Slide 7: Refining & Marketing Segment Income: 4Q 2016 vs. 3Q 2016
Refining & Marketing Segment Income 4Q 2016 vs. 3Q 2016 Variance Analysis 350 306 257 300 250 219 (70) (11) 200 $MM 150 100 (201) (26) 1 50 (16) (21) 0 3Q 2016 *LLS *Sweet/ *LLS/WTI *LLS *Market Other Direct Other 4Q 2016 6-3-2-1 Sour Diff. Diff. Prompt Structure Gross Operating Crack vs. Delivered
Slide 8: Refining & Marketing Segment Income: 2016 vs. 2015
Refining & Marketing Segment Income 2016 vs. 2015 Variance Analysis 4,500 4,086 4,000 3,500 3,000 690 2,500 334 4 58 $MM 2,000 (1,974) (260) (1,052) 64 1,543 1,500 (407) 1,000 500 0 2015* **LLS **Sweet/ **LLS/WTI **LLS **Market Lower of Other Direct Other 2016 6-3-2-1 Sour Diff. Diff. Prompt Structu
Slide 9: Speedway Segment Income
Speedway Segment Income Variance Analysis 4Q 2016 vs. 4Q 2015 200 34 165 150 135 25 10 $MM 100 (39) 50 0 4Q 2015 Light Product Merchandise Lower of Other 4Q 2016 Gross Margin Gross Margin Cost or Market 2016 vs. 2015 800 673 50 35 734 67 600 (91) $MM 400 200 0 2015 Light Product Merchandise Lower of
Slide 10: Midstream Segment Income
Midstream Segment Income Variance Analysis 4Q 2016 vs. 4Q 2015 300 36 245 82 200 $MM 20 13 100 94 0 4Q 2015* Revenue Equity MarkWest Operating Expenses 4Q 2016 Affiliates and Other 2016 vs. 2015 1,000 48 871 356 800 600 69 $MM 380 18 400 200 0 2015* Revenue Equity MarkWest Operating Expenses 2016 Af
Slide 11: Total Company Cash Flow
Total Company Cash Flow 4Q 2016 2,000 95 896 (7) 1,500 277 $MM 1,000 73 887 (793) (210) 709 (153) 500 0 9/30/2016 Operating Working Net Debt Cash Capital Issuance of Return of Distributions to Other 12/31/2016 Cash Cash Flow Capital Expenditures MPLX LP Capital to noncontrolling Cash Balance before
Slide 12: Liquidity and Capitalization/Select Cash-Flow Data
Liquidity and Capitalization/Select Cash-Flow Data MPC MPC MPLX As of December 31, 2016 Excluding Consolidated Adjustments(a) ($MM except ratio data) MPLX Debt 10,572 4,423 6,149 Mezzanine equity 1,000 1,000 - Equity 20,203 8,219 11,984 Total capitalization 31,775 13,642 18,133 Debt-to-capital ratio
Slide 13: 1Q 2017 Outlook
1Q 2017 Outlook Other Total Corporate Percent of Sour Crude Oil Turnaround Depreciation Other Crude Charge/ Total Direct and Other WTI-priced Throughput and Major and Manufacturing Throughput* Feedstocks Throughput* Operating Unallocated Crude Percentage Maintenance Amortization Cost** Throughput* C
Slide 14: Appendix
Appendix 14
Slide 15: 2017 Capital Outlook
2017 Capital Outlook Excluding Acquisitions and Dropdowns 11% 3% Speedway Corporate & Other MPC excluding MPLX ~$1.7 B Refining & Marketing (R&M) – $1,165 MM Midstream – $90 MM 25% Speedway – $380 MM R&M Sustaining Corporate & Other – $100 MM 49% Capital MPLX MPLX ~$1.7 B 9% Growth – $1,55
Slide 16: Capital Expenditures & Investments
Capital Expenditures & Investments ($MM) 2016 Revised 4Q 2016 2016 2017 Plan Plan Refining & Marketing (R&M)(a) 1,170 313 1,101 1,165 Speedway 310 112 303 380 Midstream, including MPLX(a,b) 1,525 374 1,521 1,740 Corporate and Other 95 22 81 100 Total Capital Expenditures & Investments(c) 3,100 821 3
Slide 17: Fuels Distribution Business Model
Fuels Distribution Business Model Marketing Model Marketing Model Services Model (Wholesale Distribution) (Rack-to-Retail) – MPC outsources fuels marketing – Purchase MPC’s marketing – Precedents models purchase, services to MPLX for those same businesses market, and transport fuel from services cur
Slide 18: Earnings
Earnings ($MM unless otherwise noted) 2015 2016 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Refining & Marketing segment income* 1,292 1,181 1,434 179 (62) 1,080 306 219 Speedway segment income** 168 127 243 135 167 193 209 165 Midstream segment income 90 103 93 94 167 201 258 245 Corporate and other unallocated items
Slide 19: Reconciliation: Adjusted EBITDA to Net Income Attributable to MPC
Reconciliation Adjusted EBITDA to Net Income Attributable to MPC ($MM) 2016 LTM 1Q 2Q 3Q 4Q Net Income attributable to MPC 1 801 145 227 1,174 Less: Net interest and other financial income (costs) (142) (137) (141) (136) (556) Add: Net income (loss) attributable to inco noncontrolling interests (79)
Slide 20: Reconciliation: Adjusted EBITDA Related to MPLX
Reconciliation Adjusted EBITDA Related to MPLX to MPLX Net Income ($MM) 2016 LTM 1Q 2Q 3Q 4Q MPLX Net Income (37) 20 143 132 258 Less: Net interest and other financial income (costs) (68) (64) (64) (65) (261) Add: Provision for income taxes (4) (8) - - (12) Depreciation and amortization 132 137 138
Slide 21: Cash Provided from Operations Before Changes in Working Capital Reconciliation
Cash Provided from Operations Before Changes in Working Capital Reconciliation to Net Cash Provided by Operations ($MM) 2016 (For the Quarter) 1Q 2Q 3Q 4Q Net cash provided by operations 327 2,263 405 991 Less changes in working capital: Changes in current receivables 325 (601) 67 (465) Changes in i
Slide 22: Refining & Marketing Indicative Gross Margin
Refining & Marketing Indicative Gross Margin 4Q 2016 2,500 2,000 87 1,900 581 36 (4) (30) 1,500 $MM 1,230 1,000 500 (1,319) 219 (362) 0 *LLS *Sweet/ *LLS/WTI *LLS *Market Other R&M Direct Other R&M 6-3-2-1 Sour Diff. Diff. Prompt vs. Structure Gross Gross Operating Segment Crack Delivered Margin Mar
Slide 23: MPLX Distributions and Sales Proceeds to MPC
MPLX Distributions and Sales Proceeds to MPC* 100 $91 $98 $69 $73 $MM 50 $35 $24 $27 $32 $16 $16 $18 $18 $20 $20 $10 $15 0 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 LP Distributions GP Distributions, including IDRs Cash Distribution and Asset 2013 2014 2015 2016
Slide 24: Marathon
MARATHON ®