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January 2018 Investor Presentation – Hollyfrontier Corporation

Hollyfrontier Corporation · Jan 3, 2018 · 30 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 1
    HOLLYFRONTIER INVESTOR PRESENTATION January 2018
  2. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 2
    Executive Summary Positioned for Value Creation Across all Segments REFINING MIDSTREAM SPECIALTY LUBRICANTS Inland merchant refiner Operate Crude and Product Pipelines, Integrated specialty lubricants loading racks, terminals and…
  3. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 3
    HollyFrontier Asset Footprint 4
  4. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 4
    Total Sum-of-the-Parts Valuation HFC Consolidated SOTP Valuation (US millions) HF Refining & Marketing EBITDA (Mid-Cycle) 1,100 Target Multiple 6x Enterprise Value 6,600 Share Count1 (millions) 176.6 Lubricants HF Refining &…
  5. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 5
    15% Increase in Refining Capacity Since 2015 Mid-Con Southwest Rockies CRUDE CHARGE CAPACITY CRUDE CHARGE CAPACITY CRUDE CHARGE CAPACITY Barrels Per Day Barrels Per Day Barrels Per Day 350,000 120,000 100,000 115,000 95,000 300,000…
  6. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 6
    Refinery Operations Annual Crude Charge Rate 450,000 470,000 BPD Consolidated Crude Charge Opex Per Throughput Barrel /throughput BBL Barrels Per Day 6.16 6.25 5.95 450,000 5.75 5.50 Target 5.25 5.39 5.40 5.30 425,000 4.75…
  7. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 7
    Proximity to North American Crude Production Laid in Crude Advantage Beneficiary of inland coastal crude discount across entire refining system 100% of HFCs purchased crude barrels are WTI price based Refinery location and…
  8. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 8
    High Value Premium Product Markets Product Pricing vs. Gulf Coast Regional Gasoline Pricing vs Gulf Coast1 /bbl 20 2012 2013 15 2014 2015 11.08 6.54 8.17 2016 7.60 10 Average 3.38 5 2.67 - Group 3 vs GC Chicago vs GC…
  9. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 9
    Refining Segment Earnings Power HFC Consolidated 3-2-1 Index Mid-Cycle Refining EBITDA /Barrel 1.0B 1.2B 25 Gulf Coast 3-2-1 Crack 10.00 Brent/WTI Spread 4.00 21.22 Product Transportation to HFC 20.06 3.00 Markets 20 HFC…
  10. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 10
    Holly Energy Partners Business Profile Operate a system of petroleum product and Consistent Distribution Growth Despite crude pipelines, storage tanks, distribution Crude Price Volatility terminals and loading rack facilities located…
  11. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 11
    Ownership Structure IDR Simplification Provides Lower Cost of Capital for HEP HOLLYFRONTIER CORPORATION (HFC) 100% Interest GENERAL PARTNER (GP) HOLLY LOGISTIC SERVICES, L.L.C PUBLIC Non-economic GP Interest 59.6mm HEP…
  12. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 12
    HEP Historical Growth Committed to Continuing Track Record of Increasing Distribution Holly Tulsa 50% JV with Acquired Holly Corporation dropdown of Crude gathering Plains for remaining and Frontier Oil Holly intermediate loading…
  13. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 13
    HEP Avenues for Growth ORGANIC ACQUISITIONS DROPDOWNS FROM HFC Leverage HEPs existing Pursue logistics assets in HEPs Partnering with HFC to build footprint, specifically in current geographic region and/or acquire new assets /…
  14. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 14
    HF Lubricants & Specialty Products The Worlds Machinery is Driving Towards Greater Efficiency, Reliability and Longevity Advanced lubricants are a crucial requirement in the drive HF LSP is a to develop more reliable, efficient and…
  15. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 15
    HF LSP - Rack Back vs Rack Forward RACK BACK RACK FORWARD Sales Customer Order Fulfillment Marketing Finished Lubricants Value Opportunity R&D & Greases Waxes Distribution Blending White & Packaging Oils Feedstock…
  16. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 16
    Rack Forward EBITDA Margin Stability 2018 Rack Forward EBITDA Margin1 Guidance2 EBITDA ( in millions) EBITDA Margin % 80 20% EBITDA 17% 175 200MM 16% 16% 16% EBITDA Margin 60 14% 15% 10-15% 13% 12% 10% 9% 9% 40 9% 10% 69 58 58…
  17. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 17
    HF Lubricants & Specialty Products Mid-Cycle EBITDA Rack Forward EBITDA ( in millions) 190 EBITDA Margin 10-15% Annual SG&A 125 - 135MM Target Multiple 10x Annual DD&A 30 - 35MM Upside with Organic Growth and M&A Enterprise…
  18. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 18
    Group III Base Oil Opportunity Western Hemisphere Group III Base Oil: Production Capacity vs Demand Increasing Demand for Higher 3% CAGR Demand Growth (2016-2026) Performance Finished KBD Lubricants & Specialty 25 Products Higher…
  19. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 19
    Opportunity Across the Value Chain Upgrade Existing Base Oils into Finished Products Converting one barrel of Base Oil sales into Finished Product sales results in a margin uplift of 50/bbl HF LSP Margin Value /bbl Product Sales…
  20. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 20
    New Segment Reporting HF HF REFINING LUBRICANTS & HOLLY CORPORATE, ENERGY & SPECIALTY OTHER & CONSOLIDATED MARKETING PRODUCTS (HEP) ELIMINATIONS (HF R&M) (HF LSP) Rack Back Rack Forward SG&A allocated to each segment…
  21. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 21
    2018 Guidance Refining & Marketing 2018E Capex - 5.50 Opex/bbl Segment Allocation - Turnaround Schedule - Tulsa 1Q18 HEP - El Dorado 4Q18 9% - Capex 375 425 million HF LSP HF LSP 14% - 175 200 mm Rack Forward EBITDA R&M -…
  22. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 22
    APPENDIX
  23. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 23
    Strong Track Record of Cash Returns Since the July 2011 merger HFC has returned approximately 4.3 billion, or approximately 24.50 per share to shareholders Strong track record in returning excess cash to shareholders Committed to…
  24. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 24
    HollyFrontier Capital Structure HFC Consolidated Capital Structure HFC Standalone Capital Structure As of September 30, 2017 (US millions) As of September 30, 2017 (US millions) Cash and Short Term Marketable Securities 631 Cash and…
  25. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 25
    HollyFrontier Credit Profile Investment Grade Rating Peer Group Debt Metrics 9/30/17 - S&P BBB- Debt Ratio % - Moodys Baa3 50% - Fitch BBB- 624 million cash as of 9/30/17 40% 1 billion outstanding debt as of 9/30/17 -…
  26. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 26
    Our Business Plan Update Business Improvement Plan Progress Annual EBITDA in MMs 2015 Analyst Day Target1 Full Year 2017E Acheived1 Refining Operations 245 107 Reliability 90 10 Cost 105 58 Turnaround 50 39 Optimization 90…
  27. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 27
    Definitions BPD: the number of barrels per calendar day of crude oil or petroleum products. Lubricant : A solvent neutral paraffinic product used in commercial heavy duty engine CAGR: The compound annual growth rate is calculated by…
  28. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 28
    HollyFrontier Index Please see p. 30 for disclaimer and www.HollyFrontier.com/investor-relations for most current version. 29 29
  29. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 29
    HFC Index Disclosure HFC's actual pricing and margins may differ from benchmark indicators due to many factors. For example: Crude Slate differences HFC runs a wide variety of crude oils across its refining system and crude slate may…
  30. January 2018 Investor Presentation – Hollyfrontier Corporation – slide 30
    HollyFrontier Corporation (NYSE: HFC) 2828 N. Harwood, Suite 1300 Dallas, Texas 75201 (214) 954-6510 www.hollyfrontier.com Craig Biery Director, Investor Relations investorshollyfrontier.com 214-954-6510 Jared Harding Investor…

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