Delek US Holdings Investor Presentation August 2015
Delek US Holdings Overview Mid-Continent Integrated Downstream Energy Company Crude Gathering to Retail Locations Crude Sourcing/Logistics Flexibility Pipeline Access: Midland (97,000 bpd in system) Gulf Coast and Cushing Gathered…
Alon USA Transaction On May 14, 2015, Delek completed the acquisition of approximately 33.7 million shares, or approximately 48% of the outstanding shares, of Alon USA Energy (NYSE: ALJ) (Alon USA) common stock from Alon Israel Oil…
Refining Segment Operational Update
Increased Access to Cost Advantaged Crude Approximately 75% of crude slate consist of Midland and local crude supply Increasing Access to Cost Advantage Crude Improved access to cost advantaged crude 200 (Midland/local) in refining…
Improved Operating Flexibility Increased ability to process light crude oil and ULSD capacity Since 2012 increased light crude processing Light Crude Processing and DHT Capacity Increased (1) capability by 27% based on 2015 target (In…
Tyler Refinery Expansion and FCC Reactor Economics Completed in March 2015; Expected annual incremental EBITDA of 75 million Based on incremental 15,000 bpd of crude Crude Slate throughput capacity 80.0 72.5k Capital cost of…
Refineries Serve Local Niche Markets Supports High Refining Utilization Improving Niche Markets Delek Logistics Partners terminals support refining system: Tyler refinery serves a 60 mile radius El Dorado has access to local markets,…
Effects of Declining Crude Oil Price Environment on Refining Declining crude oil price environment has ability to improve capture rate in Delek US system A 10 per barrel decline in crude oil price can increase capture rate by 0.80 per…
El Dorado Asphalt Inventory /bbl Declining Asphalt inventory cost/bbl has declined during first half of 2015 Cost of sales for asphalt based on FIFO inventory method Asphalt inventory is built during winter months and sold in 2Q/3Q…
Operating Cost Per Barrel Total Refining Operating Expense Per Barrel Sold Focus on reducing costs in operations Total operating cost per barrel declined year over year in 2Q15 Goal to reduce to below 4.00 per barrel 4.18 4.00 4.32…
Declining Capital Needs Expected after 2014 Historical and Projected Capital Spending (excluding logistics) Refining Retail Other ( in millions) 249.7 22.4 217.2 219.9 26.2 Q4 35.0 169.5 40.3 0.1 14.3 37.9 Q3 51.0 121.5…
Logistics Operational Update
Strategic Partner in Delek Logistics Partners, LP (NYSE: DKL) Growing logistics assets support crude sourcing and product marketing Storage Assets Storage facilities with 8.5 million barrels of active shell capacity Pipelines…
DKL: Plans in Place for Future Growth New agreements effective January 1, 2015 until June 30, 2016 Paline Pipeline Increased volume and capacity usage rate from 2014 level Potential for utilization and/or capacity increase Caddo…
Joint Venture Pipeline Projects Rio Pipeline Rangeland (67%)/ DKL (33%) Est. total cost: 125 million Capacity: 55,000 bpd Length: 107 miles Expected Completion: Mid-2016 Caddo Pipeline DKL (50%)/Plains (50%) Est. total cost:…
DKL: Potential EBITDA Growth (1) Visible Pathways for Growth Provide Potential for Continued EBITDA Increase in Coming Quarters (1) Potential EBITDA, in millions * 8x to 10x EBITDA 1.9 Target 3.0 5.5 Caddo Pipeline 2.5 To 3…
Increased Distribution with Conservative Coverage and Leverage Distribution has been increased eight consecutive times since the IPO 0.600 Quarterly Distribution Growth to Date 0.400 0.475 0.490 0.510 0.530 0.550 0.200 0.375 0.385…
Delek Logistics GP Incentive Distribution Rights Marginal Percentage Interest in Distributions Total Quarterly Distribution Per Unit Unitholders General Partner Current Distribution Target Amount 0.550 for 2Q 2015 Minimum Quarterly…
Retail Locations Create Synergies for Product Marketing Expanding Market Footprint in Markets Capable of Being Supplied by El Dorado Markets gasoline, diesel and merchandise through a network of retail fuel and convenience stores…
Focused on Organic Growth Large Format Stores are focal point New Builds Approximately 4,800 square feet Offer customers wider product selection Prepared food service offering increases traffic Avg. approximately 4 million gallons…
Current Retail Valuation Comparison Valuations moving higher than historical 6x-8x range Enterprise Value (EV) / Frwd. EBITDA Average = 10.0x 12.7x 9.7x 10.0x 9.9x 7.8x CASY CAPL CST MUSA SUN (1) Source: Capital IQ;…
Financial Update
Solid Financial Performance & Delivering Value to Shareholders Financial Highlights Historical Contribution Margin (MM) (1)(2) At June 30, 2015 655 610 Cash of 378.4 million; Debt of 971.9 million 524 Includes 316.9 million of debt…
Going Forward
Alon USA Energy/Alon USA Partners Operations Delek US acquired 48% ownership in Alon USA ALJ conducts its operations through three segments: Refining Refining and Marketing: sour and heavy crude oil Richmond Richmond Richmond Beach…
Questions and Answers Large, Complementary Logistics, Marketing and Retail Systems Strategically Positioned Strong Balance Sheet Refining Platform Significant Organic Focus on Shareholder Growth / Margin Returns…
Appendix Additional Data
Delek US Focused on Building an Integrated Business Model A core part of Delek US' strategy is to grow via prudent strategic transactions since 2001 2005 to 2007 2011 to 2012 2013 to Current 2011 Crude SALA Gathering Increased…
Historical and Projected Capital Spending Refining Logistics (Marketing) Retail Other ( in millions) 256.9 22.4 239.7 222.3 22.8 26.2 35.0 7.2 24.2 170.0 19.8 0.1 37.9 14.3 0.5 5.1 132.0 26.5 96.5 102.4 87.2 201.1…
U.S. Refining Environment Trends Refined Product Margins and WTI-Linked Feedstock Favor Delek US (1) (2) (2) Brent-WTI Cushing Spread Per Barrel WTI 5-3-2 Gulf Coast Crack Spread Per Barrel LLS 5-3-2 Gulf Coast Crack Spread Per…
0.00 (14.00) (12.00) (10.00) (8.00) (6.00) (4.00) (2.00) ( per barrel) Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Source: Argus as of August 14, 2015 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12…
Non-GAAP Reconciliation Delek US Contribution Margin Reconciliation ( in millions) Year Ended 12/31 2008 2009 2010 2011 2012 2013 2014 1H14 1H15 2Q15 LTM Net sales 4,723.7 2,666.7 3,755.6 7,198.2 8,726.7 8,706.8 8,324.3 4,240.4 2,843.7…
Investor Relations Contact: Assi Ginzburg Keith Johnson Chief Financial Officer Vice President of Investor Relations 615-435-1452 615-435-1366
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