CVR Energy Inc. · NYSE:CVI
CVR Energy — Investor Presentation (January 2024)
31 slides from CVR Energy's investor presentation, January 2024
Slide 1: Investor Presentation
Investor Presentation January 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements (“FLS”) which are protected as FLS under the PSLRA, and which are based on management’s current expectations and beliefs, as well as a number of assumptions concerning future events. The assumptions and estimates underl
Slide 3: Mission and Values
Mission and Values Our mission is to be a top tier North American renewable fuels, petroleum refining, and nitrogen-based fertilizer company as measured by safe and reliable operations, superior financial performance and profitable growth. Our core values are driven by our people, inform the way we
Slide 4: Company Overview
Company Overview Company Highlights Business Segments • Founded: 2006 Petroleum Segment: • Headquarters: Sugar Land, TX ▪ Two strategically located Mid-Continent refineries • Employees: 1,450+ close to Cushing, Oklahoma. Total nameplate capacity 206,500 bpd. • Description: CVR Energy is a diversifie
Slide 5: Strategic Priorities
Strategic Priorities Focus on EH&S Focusing on improvements in Environmental, Health and Safety Maters – Safety is Job #1 Performance Consolidated total recordable incident rate (TRIR) declined 63% in 2022 compared to 2021. Petroleum Segment and Nitrogen Fertilizer Segment achieved 20% and 86% reduc
Slide 6: Capital Allocation Strategy
Capital Allocation Strategy Key Priorities: ▪ Create long-term value through safe, reliable operations and continuously optimizing core refining, renewables, fertilizer and associated logistics assets; ▪ Invest in high return projects that are complimentary to existing assets and improve feedstock s
Slide 7: ESG Highlights
ESG Highlights Environmental Social Governance ▪ Renewable diesel unit start-up at the ▪ Diversity is a key component of our ▪ Board-level ESG oversight. Wynnewood Refinery in April 2022. Mission & Values. ▪ Annual Code of Ethics & Business Conduct ▪ Wynnewood Refinery feedstock ▪ Site-Level Communi
Slide 8: Petroleum Segment
PETROLEUM SEGMENT
Slide 9: Asset Footprint
Asset Footprint Mid-Continent Refineries Nameplate crude oil capacity of 206,500 bpd across two refineries ▪ 3Q 2023 total throughput of 212,420 bpd ▪ FY 2022 total throughput of 205,288 bpd; Crude oil capacity utilization of approximately 92% Average complexity of 10.8 Located in Group 3 of PADD II
Slide 10: Strategically Located Mid-Con Refineries
Strategically Located Mid-Con Refineries Multiple Product Sales Outlets Focused on maximizing refined product netbacks and participating in renewable fuel blending economics and internal generation of RINs whenever possible. For YTD 2023 through September: ▪ Approximately 20% of refined product sale
Slide 11: High-Quality Refining Assets
High-Quality Refining Assets Consolidated Top Tier Refining Margin(1) Consolidated Low-Cost Operator(2) Peer group includes: Delek US Holdings, HF Sinclair, Marathon Petroleum, Par Pacific , PBF Energy, Phillips 66 and Valero. Consolidated High Utilization Rates Total Throughput and Production Mix(1
Slide 12: Constructive Macro Environment
Constructive Macro Environment US Gasoline Demand PADD II Gasoline Demand US Diesel Demand PADD II Diesel Demand Source: EIA 11
Slide 13: Constructive Macro Environment
Constructive Macro Environment US Gasoline Inventories PADD II Gasoline Inventories US Diesel Inventories PADD II Diesel Inventories Source: EIA 12
Slide 14: Constructive Macro Environment
Constructive Macro Environment 2-1-1 Crack Spreads & Brent-WTI Differentials ($/bbl) Group 3 Crack Spreads ($/bbl) RVO-Weighted RINs ($/bbl) WCS – WTI Differential ($/bbl) Source: MarketView as of December 27, 2023 13
Slide 15: Growing Focus on Renewable Biofuels
Growing Focus on Renewable Biofuels(1) On February 1, 2023, we completed the transformation and restructuring of our business to segregate our renewable operations. ▪ Conversion of the existing hydrocracker at the Wynnewood Refinery to renewable diesel service and retooling the refinery for maximum
Slide 16: Renewable Diesel Initiatives
Renewable Diesel Initiatives Wynnewood Phase 1&2 Project KSAAT Economics Project at Wynnewood Renewable diesel margins impacted by several factors: ▪ Crude oil price and spread between ULSD and Soybean oil (HOBO spread) ▪ Feedstock basis (transportation cost + premium for pretreated material) ▪ RINs
Slide 17: Capital Expenditures and Turnarounds
Capital Expenditures and Turnarounds Total Estimated 2023 Petroleum Segment and Renewables Capex of $165M - $186M ▪ Maintenance capex estimated at $91MM to $99MM. ▪ YTD maintenance capex through 9/30/2023 of $71MM. ▪ Growth capex estimated at $74MM to $87MM. ▪ Substantially all budgeted growth capit
Slide 18: Fertilizer Segment
FERTILIZER SEGMENT
Slide 19: Stable Trends in Fertilizer Supply & Demand
Stable Trends in Fertilizer Supply & Demand Corn Stocks to Use US Nitrogen Supply ▪ Fertilizers typically represent approximately 15% of ▪ Major global nitrogen capacity build cycle largely farmers’ cost structure and significantly improve yields. complete in 2017/2018, and additional tons have been
Slide 20: Strong Demand for Corn in the U.S.
Strong Demand for Corn in the U.S. U.S. Domestic Corn Use ▪ Corn has a variety of uses and applications, including feed grains, ethanol for fuel, and food, seed and industrial (FSI) ▪ Feed grains ▪ ~96% of domestic feed grains are supplied by corn ▪ Consumes ~39% of annual corn crop(1) Domestic Corn
Slide 21: Recent Domestic Nitrogen Fertilizer Market Conditions
Recent Domestic Nitrogen Fertilizer Market Conditions ▪ UAN and Ammonia prices approximately $400/ton and $800/ton, respectively for 1Q 2023 shipment. 2022 ▪ Natural gas prices in the U.S. and Europe declined dramatically, sparking speculation in the market around curtailed European production resta
Slide 22: Strategically Located Assets
Strategically Located Assets ▪ Large geographic footprint serving the Southern Plains and Corn Belt regions ▪ Well positioned to minimize distribution costs and maximize net back pricing East Dubuque, IL ▪ Rail loading rack at the Coffeyville facility provides significant logistics optionality west
Slide 23: Key Operating Statistics
Key Operating Statistics Consolidated Production Volumes(1) Consolidated Ammonia Utilization Consolidated Feedstock Costs(1) Consolidated Sales Revenue(1)(2) (1) For the twelve months ended September 30, 2023. (2) Excludes freight and other. 22
Slide 24: Capital Expenditures and Turnaround Expenses
Capital Expenditures and Turnaround Expenses 2023 Total Capex budget of $29MM - $32MM ▪ Maintenance capex estimated at $26MM - $28MM. ▪ YTD maintenance capex through 9/30/2023 $17MM. ▪ Growth capex estimated at $3MM - $4MM. 2023 Minimal Turnaround pre-spending planned ▪ Coffeyville and East Dubuque
Slide 25: Appendix
APPENDIX
Slide 26: Non-GAAP Financial Measures
Non-GAAP Financial Measures Adjusted EBITDA – EBITDA adjusted for certain significant non-cash items and items that management believes are not attributable to or indicative of our on-going operations or that may obscure our underlying results and trends. Direct Operating Expenses per Throughput Bar
Slide 27: Non-GAAP Financial Measures
Non-GAAP Financial Measures (In USD Millions) CVR Energy, Inc. 2020 2021 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 LTM Net Income (loss) $ (320) $ 74 $ 644 $ 172 $ 259 $ 168 $ 354 $ 953 Add: Interest expense and other financing costs, net of interest income 130 117 85 18 18 16 11 63 Add: Income tax expen
Slide 28: Non-GAAP Financial Measures
Non-GAAP Financial Measures Petroleum Segment (In USD Millions, except per bbl data) Refining Margin 2020 2021 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 LTM Net sales $ 3,586 $ 6,721 $ 9,919 $ 2,422 $ 1,993 $ 2,000 $ 2,298 $ 8,713 Less: Cost of materials and other (3,288) (6,100) (8,488) (2,074) (1,582)
Slide 29: Non-GAAP Financial Measures
Non-GAAP Financial Measures (In USD Millions) CVR Partners, L.P. 2020 2021 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 LTM Net Income (loss) $ (98) $ 78 $ 287 $ 95 $ 102 $ 60 $ 1 $ 258 Add: Interest expense and other financing costs, net of interest income 63 61 $ 34 8 7 7 8 30 Add: Depreciation and amorti
Slide 30: 2023 Estimated Capital Expenditures
2023 Estimated Capital Expenditures 2022 Actual 2023 Estimate Maintenance Growth Total Maintenance Growth Total Low High Low High Low High Petroleum $ 84 $ 2 $ 86 $ 89 $ 96 $ 24 $ 27 $ 113 $ 123 (1) Renewables 2 67 69 2 3 50 60 52 63 Nitrogen Fertilizer 40 1 41 26 28 3 4 29 32 Other 7 - 7 6 7 - - 6
Slide 31: Simplified Organizational Structure
Simplified Organizational Structure(1) Icahn Public Enterprises L.P & Affiliates 33.7 % 66.3 % CVR Energy, Inc. NYSE: CVI CVR GP, LLC Public N-E GP Interest(2) 36.8 % CVR Partners, LP 63.2 % NYSE: UAN Other Petroleum Segment Nitrogen Fertilizer Segment Subsidiaries Subsidiaries Subsidiaries (includi