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CVR Energy : Investor Relations Presentation

01/05/2022 | 05:18pm EDT

Investor Presentation

January 2022

Forward-Looking Statements

This presentation conta ins forward-looking statements ("FLS") which are protected as FLS under the PSLRA, and which a re based on management's current expectations and beliefs, as well as a number of assumptions concerning future events. The assumptions and estimates underlying FLS are inherently uncertain and are subject to a wide variety of significant business and economic uncerta inties and competitive risks that could cause actual res ults to differ materially from those contained in the prospective information. According ly, there can be no assurance CVR Energy, Inc. (together with its subsidiaries, "CVI", "CVR Energy", "we", "us" or the Company") will achieve the future results we expect or that actual results will not differ materially from expectations. Statements concerning current estimates, expectations and projections about future results, performance, pros pects, opportunities, plans, actions and events and other stateme nts, conce rns, or matters that are not historica l facts are FLS and include, but are not limited to, statements regarding future:

continued safe and relia ble operations; financial performance; profitable growth; compliance with regulations; increasing focus on renewable production; crude oil capacities; strategic value of our loca tions; access to crude oil and condensate fields and price-advantaged sources; liquid volume yields; percentage of ownership in CVR Partners common units; fertilizer segment fee dstock diversity, costs, and utilization rates; agreements for UAN production; strategic priorities including our ability to operate safely, improve EH&S performance, prese rve cash, reduce operating and SG&A expenses, maintain our bala nce sheet and liquidity, take advantage of market recovery and potential nea r term opportunities, deliver high value neat crude oils to our refineries, increase crude oil gathering rates, reduce purchases of Cushing WTI, grow our renewable biofuels business, reduce the carbon footprint of our operations, minimize our RIN exposure through production of renewable biofuels, construct RDU and pre-treatment units, minimize lost profit opportunities, and improve capture rates; tra nsportation and product yield advantages; timing a nd cost of our turnarounds; ability to create long term value, optimize assets, invest in high return projects, improve feeds tock supply and product placement, provide above average cash returns, reduce cost of capita l, optimize capital structure, maximize asset utilization a nd reduce down time exposure, diversify market driver exposure, offer synergies, maintain an attractive investment profile, repurchase shares/common units, divest non-core or non-revenue generating assets, and maintain debt levels and capital structure profile in line with peers; susta ining and regulatory capex levels; availability of merger and acquisition opportunities; levels of organic growth and renewable-focused investments; manufacture of "blue" hydrogen and ammonia; carbon footprint re ductions; complexity of our facilities; optionality of our crude oil sourcing and/or marketing network; crude oil, shale oil and condensate production, quality and pricing (including price advantages) and our access thereto (including cos t of such access) via our logistics assets, truck fleet, pipelines or otherwise; impacts of COVID-19 on the Company and product demand; sales of blended products and RIN generation and capture; storage capacity; product mix; liquid volume, gasoline and dis tillate yields; refining margin and cost of operations as compared to peers or otherwise; utilization; throughput and production; economics of crude oil sales at Cushing, OK; the macro environme nt (including improvement thereof); mid-continent supply and dema nd; product inventories; crack sprea ds (including improvement thereof), crude oil differentials (including our exposure thereto);; our renewable biofuels projects including the cost, timing, benefits, capacities, phases, board of director and regulatory approvals, completion, production, processing, capital investment recovery, feedstocks, margins, credit capture and RIN impact thereof; further ca rbon reduction expans ion opportunities; the renewable diesel margin environment; the a bility to return converted unit to hydrocarbon processing or install additional reactor following renewa ble conversion; cash flows from a renewable diesel project; RIN and low carbon fuel standa rd credit pricing; expiration or extension of the blenders tax credit; capital and turnaround expenses and project timing; global and domestic nitrogen supply, demand and consumption; demand for ammonia applications; impact of Winter Storm Uri (including tighte ning of domestic supply/demand); nitrogen fertilizer demand and pricing; corn demand, stocks, uses, pricing, consumption, production, planting and yield; impact of corn stocks and pricing on nitrogen fertilizer demand and pricing; increase in corn consumption; corn exports and production drivers; gasoline and ethanol demand des truction res ulting from COVID-19, including impact on corn dema nd and fertilizer consumption; domes tic nitrogen fertilizer market conditions, including impacts of inventories, turnarounds, and corn and wheat pricing; ability to minimize distribution costs and ma ximize net ba ck pricing; logis tics optionality; rail access and delivery points; sustaina bility of production; marketing agreements for UAN production; production and utilization rates; maintena nce spending; growth capex projects and budget; weather; population growth; amount of arable farmla nd; biofuel consumption; diet evolution; product pricing and capacities; and other matters.

You are cautioned not to put undue re liance on FLS (including forecasts and projections regarding our future performance) because actua l res ults may vary materially from those expressed or implied as a result of various factors, including, but not limited to those set forth under "Risk Factors" in the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and any other filings with the Securities and Exchange Commission by CVR E nergy, Inc. ("CVI") or CVR Partners, LP ("UA N"). These FLS are made only as of the date hereof. Neither CVI nor UAN assume any obligation to, and they expressly disclaim any obligation to, update or revise any FLS, whether as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measures

Certain financial information in this presentation (including EBITDA, Adjusted E BITDA) are not presenta tions ma de in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") and use of s uch terms varies from others in the same industry. Non-GAAP fina ncial measures should not be cons idered as alternatives to income from continuing operations, income from operations or any other performance measures derived in accordance with GAAP. Non-GAAP financial measures have important limitations as analytical tools, and you should not cons ider them in is olation or as substitutes for results as reported under GAAP. This presentation includes a reconciliation of certain non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP.

Mission and Values

Our mission is to be a top tier North American petroleum refining, renewable biofuels, and nitrogen-based fertilizer company as measured by safe and reliable operations, superior financial performance and profitable growth.

Our core values define the way we do business every day to accomplish our mission. The foundation of our company is built on these core values. We are responsible to apply our core values in all the decisions we make and actions we take.

Safety - We always put safety first.

The protectionof our employees, contractors and communities is paramount. We have an unwavering commitment to safety

above all else. If it's not safe, then we don't do it.

Environment - We care for our environment.

Complying with all regulations andminimizing any environmental impact from our operations is essential. We understand

our obligationto the environment andthat it's our duty to protect it.

Integrity - We require high business ethics.

We comply with the law and practice soundcorporate governance. We onlyconduct business one way - the right way with integrity.

Corporate Citizenship - We are proud members of the communities where we operate.

We are good neighbors andknow that it's a privilege we can't take for granted. We seek to make a positive economic and

socialimpact through our financial donations andcontributions of time, knowledge and talent of our employees to the places where we live and work.

Continuous Improvement - We foster accountability under a performance-driven culture.

We believe in both individual and team a success. We foster accountability under a performance-driven culture that supports creative thinking, teamwork, diversity and personal development sothat employees can realize their maximum potential. We

use defined work practices for consistency, efficiencyandto create value across the organization.


Company Overview

CVR Energy is a diversified holding company primarily engaged in the petroleum refining and nitrogen fertilizer manufacturing industries, with an increasing focus on the production of renewable biofuels. CVR Energy's Petroleum segment is comprised of two Mid-Continent complex refineries and associated logistics assets, including a significant crude oil gathering business. Our Nitrogen Fertilizer segment is comprised of our ownership of the general partner and approximately 36 percent of the common units of CVR Partners, LP.

Petroleum Segment

    • 206,500 bpd of nameplate crude oil capacity across 2 strategically located Mid-Continent refineries close to Cushing, Oklahoma.
    • Direct access to crude oil and condensate fields in the Anadarko and Arkoma Basins.
    • Complimentary logistics assets and access to multiple key pipelines provide a variety of price advantaged crude oil supply options - 100% exposure to WTI- Brent differential.
    • 98% liquid volume yield & 94% yield of gasoline and distillate.(1)
    • Renewable Diesel Unit under construction at Wynnewood with expected production capacity of 100 mm gal. per year.
  1. Based on total throughputs; for the last twelve months ended September 30, 2021

Fertilizer Segment

  • CVI owns the general partner and 36% of the common units of CVR Partners, LP (NYSE: UAN).
  • 2 strategically located facilities serving the Southern Plains and Corn Belt.
  • Diverse feedstock exposure through petroleum coke and natural gas.
  • Consistently maintain high utilization rates at production facilities.
  • Marketing agreement with LSB Industries Pryor, OK, facility's UAN production.


Strategic Priorities

Focus on



Preserve Cash Flow



Sheet and


Focus on Crude Oil Quality and Differentials

Continuing to improve in all Environmental, Health and Safety matters - Safety is Job 1

Petroleum Segment experienced a 27% reductionin environmental events through 9/30/2021 compared to same period in 2020. Fertilizer segment achieved 73% reductionin process safety incidents and75% reduction in environmental events through 9/30/2021comparedto

same period in 2020.

Focusing capital spending on projects that are critical to safe and reliable operations

Deferring the majority of our growth capital spending, with the exception of the RDU projects at Wynnewood. Deferred turnaroundsat Wynnewood Refinery to Spring2022, Coffeyville Fertilizer to Summer 2022, and CoffeyvilleRefinery to Spring of 2023.

Positioning to take advantage of market recovery and potential near-term opportunities

Ended 3Q 2021 with total liquidity positionof $680 million(1) excludingCVR Partners andafter $492 million special dividendpaid during 3Q 2021.

Leveraging our strategic location and proprietary gathering system to deliver high value neat crude oils to our refineries

Gathering volumes in 3Q 2021 averagedapprox. 112,000 bpd. Workingto further increase volumes and reduce purchases of Cushing WTI. Transportationandproduct yield advantages from gathered crude oils typically $0.50 - $1.00 per bblrelative to CushingWTI.

Grow our



Minimize Lost


Reducing the carbon footprint of our operations and minimizing our exposure to Renewable Identification Numbers (RINs) through production of renewable biofuels

Wynnewood renewable diesel unit (RDU) under construction andexpected to be complete in April 2022. Constructionof Wynnewood pre- treatment unit (PTU) approvedby the Board and expected to be complete by YE 2022. Engineeringdesignwork underway on potential

Coffeyville RDU project. Pursuing45Q tax credits for carboncapture andsequestration activitiesat Coffeyville Fertilizer facility.

Minimizing lost profit opportunities and improving capture rates

Total 3Q 2021 lost profit opportunities of $13mm flat from 3Q 2020, of which$5mmwas due to external causes, primarilyas a result of a

third-party outage at Coffeyville Fertilizer facility.

(1) Total liquidity as of September 30, 2021 comprised of $465 million of cash, $4 million

of available for sale securities and availability under the ABL of $371 million, less cash included in the


borrowing base of $160 million

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CVR Energy Inc. published this content on 05 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 January 2022 22:17:06 UTC.

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