28
Fourth Quarter & Full Year 2019 Financial Results Conference Call March 5, 2020
Fourth Quarter & Full Year 2019Financial Results Conference Call
March 5, 2020
2
This Presentation has been prepared by Calumet Specialty Products Partners, L.P. (the “Company,” “Calumet,” "we," "our," or like terms)as of March 5, 2020. The information in this Presentation includes certain “forward-looking statements.” These statements can be
identified by the use of forward-looking terminology including “may,” “intend,” “believe,” “expect,” “anticipate,” “estimate,” “forecast,”“continue” or other similar words. The statements discussed in this Presentation that are not purely historical data are forward-lookingstatements. These forward-looking statements discuss future expectations or state other “forward-looking” information and involve risksand uncertainties. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary
statements included in our most recent Annual Report on Form 10-K and Current Reports on Form 8-K. The risk factors and other factorsnoted in our most recent Annual Report on Form 10-K and Current Reports on Form 8-K could cause our actual results to differ materiallyfrom those contained in any forward-looking statement.
Our forward-looking statements are not guarantees of future performance, and actual results and future performance may differ materiallyfrom those suggested in any forward-looking statement. All subsequent written and oral forward-looking statements attributable to us or topersons acting on our behalf are expressly qualified in their entirety by the foregoing. Existing and prospective investors are cautioned notto place undue reliance on such forward-looking statements, which speak only as of the date of this Presentation. We undertake no
obligation to publicly release the results of any revisions to any such forward-looking statements that may be made to reflect events orcircumstances after the date of this Presentation or to reflect the occurrence of unanticipated events.
Non-GAAP Financial Measures
Adjusted EBITDA, Pro forma Adjusted EBITDA, Adjusted EBITDA (ex-LCM/LIFO), Adjusted EBITDA margin, Adjusted EBITDA (ex-
LCM/LIFO) margin, Gross profit per barrel (ex-LCM/LIFO), Adjusted net income, and leverage ratio are non-GAAP financial measures
provided in this Presentation. Reconciliations to the most comparable GAAP financial measures are included in the Appendix to this
Presentation. These non-GAAP financial measures are not defined by GAAP and should not be considered in isolation or as an
alternative to net income (loss) or other financial measures prepared in accordance with GAAP. We do not provide reconciliation of non-
GAAP financial measures on a forward-looking basis as it is impractical to do so without unreasonable effort.
Forward Looking Statements
3
$262.8 MM of Adjusted EBITDA(2)
✓ Specialty Adj. EBITDA(2) of $207.9 MM; up 24% Y/Y
✓ Fuels Adj. EBITDA(2) of $152.5 MM
✓ Strong Cash Flow from Operations of $191.9 MM
2019 Fourth Quarter & Full Year Highlights(1)
3
Fourth Quarter 2019
$49.9 MM Adjusted EBITDA(2)
✓ Specialty Adj. EBITDA(2) of $42.8 MM
✓ Fuels Adj. EBITDA(2) of $28.7 MM
✓ Performed well through Shreveport turnaround
Strategy & Balance Sheet
✓ Divested San Antonio refinery
✓ Refinanced 2021 notes in unsecured market
✓ Revenue growth in specialty waxes business
Full Year 2019
Strategy & Balance Sheet
✓ Leverage down to 4.0x (4.6x ex-LCM/LIFO)
✓ Reduced debt $391 MM & interest $21 MM Y/Y
✓ Upgraded by Moody’s, S&P and Fitch
Specialty Margin Growth
✓ Specialty sales volume growth of 4%
✓ Gross profit/bbl(2) of $34.41 vs. $32.11 Y/Y
✓ Adj. EBITDA(2) margin of 15.4% vs.12.2% Y/Y
Specialty Margin Growth
✓ Adj. EBITDA(2) margin of 14.2% up 50 bps Y/Y
✓ Rationalized 2,100 bpd of low-margin volume
✓ Backfilling capacity with higher-margin production
(1) This presentation reflects the addition of our Corporate segment, which was added in the third quarter of 2019
(2) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations
4
Strategic Priorities
▪ Pivoting from turnaround story to growth
– Strengthening our commercial excellence capabilities
– Debottlenecking continues to drive utilization and yield improvements
– Product rationalization driving margin expansion
– Self-Help program now part of culture
▪ Further deleveraging remains a top priority
– Consistently generating cash flow from operations
– Expect to address the 2022 and/or 2023 maturities in the near-term
▪ Focused on the core
– Targeting gross profit per barrel over $40 and Adj. EBITDA margins over 15% annually
– Acquired Paralogics, LLC; selectively evaluating further bolt-on acquisitions
– Reviewing strategic options for the Great Falls refinery
5
M&A
Opportunistic Growth
Projects
Operations Excellence
Self-Help Delivery
• Inventories(2) reduced $16 MM Y/Y
• Debottleneck completed at
Shreveport & Finished Lubricants
facilitiesStrong Utilization• Record(1) Fuels sales
• Record Great Falls throughput
• Record Cotton Valley crude runs
• Record TruFuel sales
• Record Dickinson throughput
Strong Cash Flows• Highest Free Cash Flow(3)
since 2012
• Highest Cash Flow from
Operations since 2015
Better Cost Management
• Transportation costs down $14 MM Y/Y
• Interest expense down $21 MM Y/Y
Record Safety Performance
• Best performance for personal safety
• Best performance for process safety
Executing Operations Excellence
(1) Pro forma for divestments of Dakota Prairie and Superior refineries
(2) As stated in the Statement of Cash Flows
(3) Cash Flow from Operating Activities less Additions to property, plant and equipment Roadmap for Growth
6
$3,452.6 $3,497.5
$262.8
$300.8
0
50
100
150
200
250
300
350
400
450
500
$0.0
$500.0
$1,000.0
$1,500.0
$2,000.0
$2,500.0
$3,000.0
$3,500.0
$4,000.0
Revenue Adj. EBITDA(1)
$774.8
$848.0
$49.9
$105.0(2)
0
50
100
150
200
250
$0.0
$100.0
$200.0
$300.0
$400.0
$500.0
$600.0
$700.0
$800.0
$900.0
Revenue Adj. EBITDA(1)
Consolidated 4Q and FY19 Financial Results ($MM)
4Q184Q19
Fourth Quarter Full Year
(1) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations
(2) Adjusted to remove $2.0 million from the divestiture of Anchor Drilling Fluids USA, LLC
FY18FY19
7
Adjusted EBITDA(1) Bridge – FY19 vs. FY18 ($MM)
(1) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations
(2) Includes hedging
(3) Includes plant operating and maintenance costs including RINs activities
(4) Includes reduced transportation costs, offset by 2017 Superior RINs exemption received in 2018
$300.8
($79.8)
$11.7
$37.7
$19.0
($17.9) ($2.5)($6.2)
$262.8
FY18 Adj. EBITDA (1) Fuels Margin (2) Specialty Margin (2) Fuels Volume Specialty Volume Operating Costs (3) Other (4) SG&A FY19 Adj. EBITDA (1)
8
Specialty Products Segment Highlights
(1) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations.
▪ Adj. EBITDA(1):
– 4Q: Strong Finished Lubricants performance, offset by Shreveport turnaround activity
– FY: Reflects solid growth in Solvents, Naphthenic Oils & Finished Lubricants
▪ Adj. EBITDA(1) Margin :
– 4Q: Improved sales mix from rationalizing 2,100 bpd of lower margin SKUs
– FY: Improved sales volumes and product mix
▪ Gross Profit/ bbl(1)
– 4Q: Impacted by significantly tighter crude differentials
– FY: Improved sales volumes and product mix
Adj. EBITDA(1) Adj. EBITDA Margin(1) Gross Profit/ bbl(1)
$MM Y/Y ∆ % Y/Y ∆ $/bbl Y/Y ∆
4Q19 $ 42.8 (5.3)% 14.2% +50bps $ 30.94 (3.3)%
FY19 $ 207.9 23.5% 15.4% +320bps $ 34.41 7.2%
9
Improved Specialty Performance FY19 vs. FY18 ($MM)
(1) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations
(2) Includes hedging
(3) Includes costs related to transportation, and other expenses
$166.3 $168.3
$11.7
$19.0 $2.2 $8.1
($1.4)$207.9
FY18 Adj. EBITDA (AsPreviously Reported) (1)
FY18 Adj. EBITDA (1) Specialty Margin (2) Specialty Volume Operating Costs Other (3) SG&A FY19 Adj. EBITDA (1)
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Fuel Products Segment Highlights
(1) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations.
(2) Production volume is as reported and not pro-forma for the sale of the San Antonio refinery
▪ Adj. EBITDA(1):
– 4Q: Avg. WCS and Midland differentials tightened $(15.50) and $(6.61), respectively
– FY: Avg. WCS and Midland differentials tightened $(13.29) and $(6.28), respectively
▪ Production Volume(2):
– 4Q: Impacted by Shreveport turnaround and San Antonio divestment
– FY: Improved throughput and record capacity utilization across portfolio
▪ Gross Profit/ bbl(1):
– Both 4Q and FY declined as WCS/WTI differential tightened meaningfully
Adj. EBITDA(1) Production Volume(2) Gross Profit/ bbl(1)
$MM Y/Y ∆ Kbd Y/Y ∆ $/bbl Y/Y ∆
4Q19 $ 28.7 (65.4)% 68.5 (1.9)% $ 3.50 (71.4)%
FY19 $ 152.5 (33.7)% 76.4 8.8% $ 3.34 (53.7)%
– WCS/WTI avg. differential ($19.16) vs. ($34.67) in 4Q18
– WCS/WTI avg differential ($13.56) vs. ($26.85) in FY18
– Midland/WTI avg. differential $0.93 vs. ($5.68) in 4Q18
– Midland/WTI avg. differential ($0.72) vs. ($7.00) in FY18
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Strong Fuels Performance FY19 vs. FY18 Despite Headwinds ($MM)
(1) Excludes non-cash LCM/LIFO adjustments See Appendix to this presentation for GAAP to Non-GAAP reconciliations
(2) Includes hedging
(3) Includes plant operating and maintenance costs including RINs activities
(4) Includes reduced transportation costs, offset by 2017 Superior RINs exemption received in 2018
$134.5
$230.0
($79.8)
$37.7
($20.1)
($17.0)
$1.7
$152.5
FY18 Adj. EBITDA (AsPreviously Reported) (1)
FY18 Adj. EBITDA (1) Fuels Margin (2) Fuels Volume Operating Costs (3) Other (4) SG&A FY19 Adj. EBITDA (1)
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FY19 Sources & Uses of Cash ($MM)
(1) Does not include Turnaround Costs
(2) Includes $4.0 million of legal fees and pipeline settlements
(3) Cash flow from financing activities
(4) Additions to Property, Plant and Equipment including Turnaround Costs
$155.7
$209.7
$55.1 $14.3
($343.0)
($72.7) $19.1
FY18 Cash Balance Cash Flow fromOperations (1)
Net Proceeds from theSale of San Antonio
(2)
Other Investing Reduction of Debt (3) Capex (4) FY19 Cash Balance
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Continuously Improving Credit Metrics
(1) See Appendix to this presentation for GAAP to Non-GAAP reconciliations
(2) Fixed Charge Coverage Ratio defined as Adj. EBITDA divided by consolidated interest expense (plus capitalized interest), neither of which has been pro-forma adjusted for acquisitions or refinancing activity
(3) Excludes $350 million of restricted cash
(2)
(3)
▪ Credit metrics improved Y/Y
― Net Debt/TTM Adj. EBITDA(1) by 1.6x
― Fixed Charge Coverage(2) by 0.6x
▪ Liquidity down Y/Y due to debt repayment
(1)
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Calumet Focused on Specialty Growth
Scott Obermeier: Executive Vice President – Commercial
▪ Appointed Executive Vice President Commercial effective January 2020
- Responsible for Lubricating Oils, Solvents and Waxes
- Corporate Marketing, R&D and Customer Service
▪ Calumet’s General Manager of Base Oils since mid-2018 and Vice
President of Commercial Excellence since late 2017
▪ Previously Vice President of Univar’s organic chemicals business
▪ 20+ years experience in specialty chemicals
Acquired Paralogics, LLC
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Specialty wax production
Import value chain logistics
Blending and Formulating
Fully integrated wax
solutionsSpecialty wax
production
Blending &
Formulating
Packaging &
Distribution
Fully integrated wax
solutions
[---------------------------------------------------- Wax Business Value Chain ------------------------------------------------------]
▪ Paralogics, LLC will add:
― 20 MM pounds wax blending capacity
― Formulating and blending expertise
― Packaging & distribution capability
▪ Current Calumet wax business
― 100 MM pounds per year production
― $119 MM 2019 revenues
▪ Investment Logic:
― Penetrate higher margin end markets
― Value chain extension into packaging and blends
― Additional technical expertise in high margin formulations
― Synergies with Calumet wax business
― Adds additional logistics hub
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Self-Help in Action: $40MM Adj. EBITDA Goal in 2020
[-------- Specialty Focused -------]
Cost Reductions
Raw Material Optimization
Margin Enhancements
Facilitated Non-Core Asset Sales
Specialty Growth Initiatives
Two Debottlenecking Projects
Further Rationalizing Low Margin Products
Additional Finished Lubricant Expansion
Cost Reduction Plan(1)
Reducing Professional Services
Facility Fixed Costs
Corporate Staffing
2020 Goal: $40 MM
Adj. EBITDA
(1) Anticipate approximately $10 million in one-time costs to implement
2021
Self-Help Phase II(2019-2021)
On track for $100 MM Adj.
EBITDA Goal
2019: $30 MM 2020 2021
Self-Help Phase I(2016-2018)
Delivered $182 MM
Adj. EBITDA
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FY20 Outlook
Specialty Products
▪ Continue expanding Adj. EBITDA margin
▪ Gross profit per barrel over $40
▪ Specialty commercial initiatives to drive growth
Fuel Products
▪ Improved WCS crude margins
▪ Initiatives in place to capture local rack differentials
Corporate/Strategic
▪ Integrate Paralogics, LLC
▪ Review strategic options for Great Falls refinery
▪ Self-Help Phase II initiatives expected to deliver $40 million of incremental Adj. EBITDA
– Specialty growth and product rationalization ~ $20 million
– SG&A costs $20 million lower Y/Y
▪ Capex guidance of $80-$90 million
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AppendixSupplemental Financial Data
19
Our Strategy & Roadmap for Growth
▪ Focus portfolio on high-return,
niche specialty markets where
we are competitively advantaged
▪ Capture one-to-two-year
payouts with low capital
investment requirements
▪ Reduce costs, optimize
raw materials and
enhance margins
Strategic
M&A
Opportunistic Growth
Projects
Operations Excellence
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Adjusted EBITDA(1) Bridge – 4Q19 vs. 4Q18 ($MM)
$105.0
($76.2)($3.3)
$0.4
($5.5)
$12.8
$11.1
$5.6
$49.9
4Q18 Adj. EBITDA(1)(2)
Fuels Margin (3) Specialty Margin (3) Fuels Volume Specialty Volume Operating Costs (4) Other (5) SG&A 4Q19 Adj. EBITDA (1)
(1) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations
(2) Adjusted to remove $2.0 million from the divestiture of Anchor Drilling Fluids USA, LLC
(3) Includes hedging
(4) Includes plant operating and maintenance costs including RINs activities
(5) Includes costs related to transportation
21
Specialty Adjusted EBITDA(1) Bridge – 4Q19 vs. 4Q18 ($MM)
$44.1 $45.2 ($3.3)
($5.5)
$0.1
$4.3 $2.0
$42.8
4Q18 Adj. EBITDA (AsPreviously Reported)(1)
4Q18 Adj. EBITDA (1) Specialty Margin (2) Specialty Volume Operating Costs Other (3) SG&A 4Q19 Adj. EBITDA (1)
(1) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations(2) Includes hedging
(3) Includes costs related to transportation
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Fuels Adjusted EBITDA(1) Bridge – 4Q19 vs. 4Q18 ($MM)
$60.9
$82.9
($76.2)
$0.4
$12.7 $3.8
$5.1
$28.7
4Q18 Adj. EBITDA (AsPreviously Reported) (1)
4Q18 Adj. EBITDA (1) Fuels Margin (2) Fuels Volume Operating Costs (3) Other (4) SG&A 4Q19 Adj. EBITDA (1)
(1) Excludes non-cash LCM/LIFO adjustments. See Appendix to this presentation for GAAP to Non-GAAP reconciliations
(2) Includes hedging
(3) Includes plant operating and maintenance costs including RINs activities
(4) Includes costs related to transportation
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Exhibit A: Capital Structure OverviewActual Actual Actual Actual Actual Actual Actual Actual
($ in millions) 3/31/18 6/30/18 09/30/18 12/31/18 03/31/19 06/30/19 09/30/19 12/31/19
Cash $ 496.6 $ 38.8 $ 65.5 $ 155.7 $ 152.9 $ 173.5 $ 164.2 $ 19.1
ABL Revolver Borrowings $ — $ 0.1 $ 0.1 $ — $ — $ — $ — $ —
7.625% Senior Notes due 2022 350.0 350.0 350.0 350.0 350.0 350.0 350.0 350.0
6.50% Senior Notes due 2021 900.0 900.0 900.0 900.0 876.8 810.2 761.2 —
7.75% Senior Notes due 2023 325.0 325.0 325.0 325.0 325.0 325.0 325.0 325.0
11.00% Senior Notes due 2025 — — — — — — — 550.0
11.50% Senior Secured Notes due 2021 400.0 — — — — — — —
Finance Leases 43.7 42.2 41.8 42.4 3.3 3.0 2.8 2.7
Other 6.3 5.9 5.5 5.2 4.9 4.5 4.1 3.8
Total Debt $ 2,025.0 $ 1,623.2 $ 1,622.4 $ 1,622.6 $ 1,560.0 $ 1,492.7 $ 1,443.1 $ 1,231.5
Partners’ Capital $ 115.4 $ 66.6 $ 51.2 $ 65.7 $ 83.5 $ 67.1 $ 62.8 $ 21.6
Total Capitalization $ 2,140.4 $ 1,689.8 $ 1,673.6 $ 1,688.3 $ 1,643.5 $ 1,559.8 $ 1,505.9 $ 1,253.1
LTM Adjusted EBITDA (as reported) $ 313.5 $ 290.8 $ 249.4 $ 263.9 $ 286.6 $ 287.3 $ 306.5 $ 304.6
Net Debt / LTM Adjusted EBITDA (as reported) 4.9x 5.4x 6.2x 5.6x 4.9x 4.6x 4.2x 4.0x
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EXHIBIT B: Reconciliation of Adjusted EBITDA to Net Income (Loss)
(1) In 2018, the Company and The Heritage Group formed Biosyn Holdings, LLC (“Biosyn”) for the purposes of acquiring Biosynthetic Technologies, LLC (“Biosynthetic Technologies”), a startup companywhich developed an intellectual property portfolio for the manufacture of renewable-based and biodegradable esters. The initial cash investment of $3.8 million made by the Company into Biosyn wasexpensed in the period ended March 31, 2018 given Biosyn’s operations were all related to research and development. The Company accounts for its ownership in Biosyn under the equity method ofaccounting. During March 2019, the Company sold its investment to The Heritage Group and recognized a gain of $5.0 million. For comparability purposes, $3.8 million of the gain is included in AdjustedEBITDA for the three months ended March 31, 2019.
($ in millions) 3/31/18 06/30/18 09/30/18 12/31/18 03/31/19 06/30/19 09/30/19 12/31/19
Segment Adjusted EBITDA
Corporate Adjusted EBITDA $ (29.6) $ (20.8) $ (24.0) $ (23.1) $ (24.8) $ (28.4) $ (22.8) $ (21.6)
Specialty products Adjusted EBITDA 39.4 53.3 36.6 32.9 64.2 54.9 52.2 48.9
Fuel products Adjusted EBITDA 66.6 46.8 41.9 43.9 58.3 53.1 44.1 26.5
Discontinued operations Adjusted EBITDA (1.4) (0.4) (0.2) 2.0 — — — —
Adjusted EBITDA $ 75.0 $ 78.9 $ 54.3 $ 55.7 $ 97.7 $ 79.6 $ 73.5 $ 53.8
Less:
Unrealized (gain) loss on derivative Instruments
$ (2.0) $ (0.8) $ 2.4 $ (29.8) $ 2.6 $ 12.2 $ 5.4 $ 5.9
Realized (gain) loss derivative activities, not included in net income (loss) or settled in a prior period
— 2.1 0.7 (2.8) — — — —
Amortization of turnaround costs 3.3 2.7 2.7 4.1 4.8 5.6 6.1 2.8
Debt extinguishment costs 0.6 58.2 — — (0.4) (0.3) — 2.9
(Gain) loss on the sale of business, net 1.6 (1.8) (3.4) 2.9 — — — 8.7
Loss on impairment and disposal of assets 0.5 0.7 0.9 3.2 11.7 16.2 3.2 5.9
Other non-recurring expenses — — — — — — 1.3 2.2
Gain on sale of unconsolidated affiliate (1) — — — — (1.2) — — —
Equity based compensation and other items 1.1 1.9 (0.2) (4.1) 3.4 2.3 0.4 1.3
EBITDA $ 69.9 $ 15.9 $ 51.2 $ 82.2 $ 76.8 $ 43.6 $ 57.1 $ 24.1
Less:
Interest expense $ 45.2 $ 37.5 $ 37.7 $ 35.1 $ 32.3 $ 33.1 $ 33.8 $ 35.4
Depreciation and amortization 29.7 29.5 29.6 29.3 28.2 27.0 27.4 27.5
Income tax expense (benefit) (0.2) 0.8 0.4 (0.3) (0.1) 0.3 0.5 (0.2)
Net income (loss) $ (4.8) $ (51.9) $ (16.5) $ 18.1 $ 16.4 $ (16.8) $ (4.6) $ (36.6)
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EXHIBIT C: Reconciliation of Net Income (Loss) to Adj. EBITDA & Pro Forma Adj. EBITDA (ex-LCM/LIFO)
(1) In 2018, the Company and The Heritage Group formed Biosyn for the purposes of acquiring Biosynthetic Technologies, a startup company which developed an intellectual property portfolio for themanufacture of renewable-based and biodegradable esters. The initial cash investment of $3.8 million made by the Company into Biosyn was expensed in the period ended March 31, 2018 given Biosyn’soperations were all related to research and development. The Company accounts for its ownership in Biosyn under the equity method of accounting. During March 2019, the Company sold its investment toThe Heritage Group and recognized a gain of $5.0 million. For comparability purposes, $3.8 million of the gain is included in Adjusted EBITDA for the three months ended March 31, 2019.
(2) Pro forma adjusts for divestitures of the Superior Refinery and Anchor Drilling Fluids USA, LLC in 4Q17
($ in millions) 12/31/17 3/31/18 06/30/18 09/30/18 12/31/18 03/31/19 06/30/19 09/30/19 12/31/19
Net income (loss) $ (83.6) $ (4.8) $ (51.9) $ (16.5) $ 18.1 $ 16.4 $ (16.8) $ (4.6) $ (38.6)
Add:
Interest expense $ 47.3 $ 45.2 $ 37.5 $ 37.7 $ 35.1 $ 32.3 $ 33.1 $ 33.8 $ 35.4
Depreciation and amortization 37.9 29.7 29.5 29.6 29.3 28.2 27.0 27.4 27.5
Income tax expense (benefit) — (0.2) 0.8 0.4 (0.3) (0.1) 0.3 0.5 (0.2)
EBITDA $ 1.6 $ 69.9 $ 15.9 $ 51.2 $ 82.2 $ 76.8 $ 43.6 $ 57.1 $ 24.1
Add:
Unrealized (gain) loss on derivative Instruments
$ (1.4) $ (2.0) $ (0.8) $ 2.4 $ (29.8) $ 2.6 $ 12.2 $ 5.4 $ 5.9
Realized (gain) loss derivative activities, not included in net income (loss) or settled in a prior period
— — 2.1 0.7 (2.8) — — — —
Amortization of turnaround costs 3.9 3.3 2.7 2.7 4.1 4.8 5.6 6.1 2.8
Debt extinguishment costs — 0.6 58.2 — — (0.4) (0.3) — 2.9
(Gain) loss on sale of business, net (173.4) 1.6 (1.8) (3.4) 2.9 — — — 8.7
Loss on impairment and disposal of assets 0.2 0.5 0.7 0.9 3.2 11.7 16.2 3.2 5.9
Other non-recurring expenses 206.9 — — — — — — 1.3 2.2
Gain on sale of unconsolidated affiliate (1) — — — — — (1.2) — — —
Equity based compensation and other items 3.4 1.1 1.9 (0.2) (4.1) 3.4 2.3 0.4 1.3
Adjusted ABITDA $ 41.2 $ 75.0 $ 78.9 $ 54.3 $ 55.7 $ 97.7 $ 79.6 $ 73.5 $ 53.8
Less:
Discontinued operations Adjusted EBITDA (0.3) (1.4) (0.4) (0.2) 2.0 — — — —
Superior Adjusted EBITDA 16.8 — — — — — — —
Total pro forma Adjusted EBITDA (2) 24.7 76.4 79.3 54.5 53.7 97.7 79.6 73.5 53.8
LCM inventory adjustments (14.1) (3.1) (14.0) 2.3 45.4 (38.9) (2.6) 2.7 3.0
LIFO inventory layer adjustments 2.9 — — 0.4 5.9 0.9 — — (6.9)
Less: Superior LIFO/LCM 0.5 — — — — — — — —
Pro forma EBITDA (excluding LCM/LIFO) (2) 14.0 73.3 65.3 57.2 105.0 59.7 77.0 76.2 49.9
Adjusted EBITDA (excluding LCM/LIFO) 30.0 71.9 64.9 57.0 107.0 59.7 77.0 76.2 49.9
26
EXHIBIT D: Reconciliation of Operating Metrics (ex-LCM/LIFO)Three Months Ended December 31, Year Ended December 31,
($ in millions, except per barrel data) 2019 2018 2019 2018
Specialty Adjusted EBITDA $ 48.9 $ 32.9 $ 220.2 $ 162.2
LCM inventory adjustments (2.4) 9.7 (9.5) 3.4
LIFO inventory layer adjustments (3.7) 2.6 (2.8) 2.7
Specialty Adjusted EBITDA (ex-LCM/LIFO) $ 42.8 $ 45.2 $ 207.9 $ 168.3
Fuel Adjusted EBITDA $ 26.5 $ 43.9 $ 182.0 $ 199.2
LCM inventory adjustments 5.4 35.7 (26.3) 27.2
LIFO inventory layer adjustments (3.2) 3.3 (3.2) 3.6
Fuel Adjusted EBITDA (ex-LCM/LIFO) $ 28.7 $ 82.9 $ 152.5 $ 230.0
Corporate Adjusted EBITDA $ (21.6) $ (23.1) $ (97.6) $ (97.5)
Total Adjusted EBITDA $ 53.8 $ 55.7 $ 304.6 $ 263.9
LCM inventory adjustments 3.0 45.4 (35.8) 30.6
LIFO inventory layer adjustments (6.9) 5.9 (6.0) 6.3
Total Adjusted EBITDA (ex-LCM/LIFO) $ 49.9 $ 107.0 $ 262.8 $ 300.8
Reported Specialty gross profit per barrel $ 33.82 $ 26.57 $ 35.74 $ 31.41
LCM/LIFO inventory adjustments per barrel (2.88) 5.43 (1.33) 0.70
Specialty gross profit per barrel (ex-LCM/LIFO) $ 30.94 $ 32.00 $ 34.41 $ 32.11
Reported Fuel gross profit per barrel $ 3.18 $ 6.80 $ 4.35 $ 6.07
LCM/LIFO inventory adjustments per barrel 0.32 5.44 (1.01) 1.15
Fuel gross profit per barrel (ex-LCM/LIFO) $ 3.50 $ 12.24 $ 3.34 $ 7.22
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EXHIBIT E: Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss)
(1) Beginning in third quarter 2019, Amortization of turnaround costs were no longer included in the calculation
Three Months Ended December 31,
Year Ended December 31,
($ in millions, except per unit data) 2019 2018 2019 2018
Net income (loss) $ (38.6) $ 18.1 $ (43.6) $ (55.1)
LCM 3.0 45.4 (35.8) 30.6
LIFO (6.9) 5.9 (6.0) 6.3
Unrealized (gain) loss on derivative instruments 5.9 (29.8) 26.1 (30.2)
Realized gain on derivatives, not included in net income (loss) or settled in a prior period — — — —
Debt extinguishment costs 2.9 — 2.2 58.8
Loss on impairment and disposal of assets 5.9 — 37.0 —
Gain on sale of unconsolidated affiliate — — (1.2) —
(Gain) loss on sale of business, net 8.7 2.9 8.7 (0.7)
Amortization of turnaround costs (1) — — — —
Equity based compensation and other non-cash items 1.3 (3.7) 7.4 4.0
Adjusted net income (loss) $ (17.8) $ 38.8 $ (5.2) $ 13.7
Adjusted net income (loss) per unit $ (0.23) $ 0.50 $ (0.07) $ 0.18
Average limited partner units - diluted 78,332,671 78,218,831 78,212,136 77,943,992
28
Contact Information
CONTACT INFORMATION
Joe Caminiti or Chris Hodges
Alpha IR
312-445-2870
Email: [email protected]
