INVESTOR PRESENTATION I MAY 2022 - Public Technologies
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INVESTOR PRESENTATION I MAY 2022
Forward-Looking Statements / Disclaimers
The information contained in this presentation has been prepared to assist you in making your own evaluation of the company and does not purport to contain all of the information you may consider important. Any estimates or
projections with respect to future performance have been provided to assist you in your evaluation, but should not be relied upon as an accurate representation of future results. Certain statements, estimates and financial information
contained in this presentation constitute forward-looking statements.
Such forward-looking statements involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from the results implied or expressed in such forward-looking statements. While
presented with numerical specificity, certain forward-looking statements are based (1) upon assumptions that are inherently subject to significant business, economic, regulatory, environmental, seasonal and competitive
uncertainties, contingencies and risks including, without limitation, our ability to maintain adequate liquidity, our ability to realize the potential benefit of our net operating loss tax carryforwards, our ability to obtain sufficient debt and
equity financing, our capital costs and operating costs, anticipated commodity pricing, anticipated refinery closures, differentials or crack spreads, anticipated or projected pricing information related to oil, NGLs, and natural gas, our ability
to realize the potential benefits of our supply and offtake agreements, assumptions related to our investment in Laramie Energy, LLC, Laramie Energy, LLC’s financial and operational performance and plans, including estimated production
growth and Adjusted EBITDAX, our ability to meet environmental and regulatory requirements, our ability to increase refinery throughput and profitability, estimated production, our ability to evaluate and pursue strategic and growth
opportunities, our estimates of anticipated Adjusted EBITDA, Adjusted Net income per share, and Adjusted earnings per share, the amount and scope of anticipated capital expenditures and turnaround activities, expectations related to our
potential renewable fuels projects, other maintenance and growth capital projects, our retail store conversion, anticipated 10 year and next 12 months turnaround schedule and expenditures, including costs, timing, and benefits,
anticipated throughput, production costs, on-island and export sales expectations in Hawaii, anticipated throughput and distillate yield expectations in Wyoming, our estimates related to the annual gross margin impact of changes in RINs
prices, our expectations regarding RINs prices and related small refinery exemptions, estimates related to the impact of COVID-19 on our business, results of operations, financial position, and liquidity, the conflict between Russia and
Ukraine and its potential impacts on the global crude oil market and our business, estimated impact on annual free cash flow of key drivers, expectations regarding Par Pacific’s posted market indices and the other metrics we utilize,
(including free cash flow, Adjusted EBITDA, Adjusted Net income per share, and Adjusted earnings per share), and other known and unknown risks (all of which are difficult to predict and many of which are beyond the company's control),
some of which are further discussed in the company’s periodic and other filings with the SEC and (2) upon assumptions with respect to future business decisions that are subject to change.
There can be no assurance that the results implied or expressed in such forward-looking statements or the underlying assumptions will be realized and that actual results of operations or future events will not be materially different from
the results implied or expressed in such forward-looking statements. Under no circumstances should the inclusion of the forward-looking statements be regarded as a representation, undertaking, warranty or prediction by the company or
any other person with respect to the accuracy thereof or the accuracy of the underlying assumptions, or that the company will achieve or is likely to achieve any particular results. The forward-looking statements are made as of the date
hereof and the company disclaims any intent or obligation to update publicly or to revise any of the forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable
law. Recipients are cautioned that forward-looking statements are not guarantees of future performance and, accordingly, recipients are expressly cautioned not to put undue reliance on forward-looking statements due to the inherent
uncertainty therein.
This presentation contains non-GAAP financial measures, such as Adjusted EBITDA, Adjusted Net Income (loss), and Laramie Energy Adjusted EBITDAX. Beginning with financial results reported for periods in fiscal year 2022, the inventory
valuation adjustment was modified to include the first-in, first-out (“FIFO”) inventory gains (losses) associated with our titled manufactured inventory in Hawaii. This modification was made to better align Adjusted Net Income (Loss) and
Adjusted EBITDA with the cash flow of the Hawaii refining business. Prior to 2022, the impacts of FIFO inventory gains (losses) associated with Hawaii titled manufactured inventory were eliminated through the inventory valuation
adjustment. Our calculation of Adjusted Gross Margin is also adjusted for the inventory valuation adjustment. We have recast Adjusted Gross Margin, Adjusted Net Income (Loss) and Adjusted EBITDA for prior periods when reported to
conform to the modified presentation. Please see the Appendix for the definitions and reconciliations to GAAP of the non-GAAP financial measures that are based on reconcilable historical information.
1
Company Highlights
• Owner & operator of essential energy infrastructure in PADD IV and V
markets
• 154,000 bpd operating petroleum refining capacity
• Integrated logistics network with 9 MMbbls of storage, and marine, rail
and pipeline assets
• Logistics system in Tacoma includes unit train and terminalling
capabilities for renewable fuels and feedstocks
• 119 fuel retail locations in Hawaii and the Pacific Northwest
• 46% ownership interest in Laramie Energy, a natural gas E&P company
• $1.6 billion in federal tax attributes as of December 31, 2021
Disciplined Focus on Increasing Adjusted EPS and Free Cash Flow
2
Improving Financial Performance
LTM Consolidated Adj. EBITDA 1
Excluding 2019-2020 RIN MTM Gain/(Loss)
$207
$122 $123
$100
$91
$46
$26
$(38)
$(53)
Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22
1. Last Twelve Months (LTM) Consolidated Adjusted EBITDA chart excludes 2019-2020 RIN MTM Gain/(Loss). See appendix for non-GAAP reconciliations.
3
Financial Metrics
Q1-22
2019 2020 2021 As of Mar 31, 2021
LTM
Adjusted EBITDA ($ millions)
Share Price 1 $14.67
Refining $175 $(172) $4 $51
Logistics 76 57 73 73
Enterprise Value 1 $1,343
Retail 59 65 47 45
Corporate & Other (44) (40) (48) (50)
2019-2020 RIN MTM Gain (Loss) 1 (38) (46) (4) Net Debt $461
Adj. EBITDA excl. RIN MTM $265 $(53) $122 $123
Diluted Adjusted Net Income Liquidity $212
$1.90 $(4.76) $(1.47) $(0.70)
(Loss) per Share
Note: Adjusted EBITDA totals may not foot due to rounding.
1 Equity value of approximately $882 MM reflects share price of $14.67 and outstanding share count of approximately 60.1 MM as of April 29, 2022.
See appendix for non-GAAP reconciliations.
4
Refining Overview
Refining Segment Highlights Refinery Crude Capacity Mbpd
• Focus on process safety, environmental compliance and Hawaii (Par East) 94
operational reliability
Washington 42
• 154,000 bpd operating petroleum refining capacity
• Distillate-oriented yield profile Wyoming 18
• Throughput and yield optimized to serve local market needs Par Pacific System 154
• Access to Western Canadian, Powder River Basin and
Bakken crudes
Q1 2022 Crude Sourcing 1 Q1 2022 Combined Product Yield 1
10% Powder 43% Distillates
4% Other
River Basin
Products
53% Other
Waterborne 4% Asphalt
Inland exposure 16% Bakken
Waterborne exposure
6% Cold Lake 28% Gasoline
21% LSFO
15% ANS 5
1. Crude and Yield charts reflect Q1 Washington turnaround.
Improving Market Fundamentals
HAWAII WYOMING WASHINGTON
Market Indices 1 Sing 3.1.2 WY 3.2.1 PNW 5.2.2.1
Competitive Position • Jet fuel demand levels surpasses • Closures of competitive refineries in • PADD V closures expected to result
refinery production the region in balanced to short refined product
• Power generation demand expected • Recently completed pipeline market
to increase mid-year 2022 improves PRB crude access • Exploring renewable fuels
• Recent Chinese policies reduced • Jet fuel sales through proprietary throughput opportunities through
refined product exports and pipeline to military base logistics infrastructure
addressed tax evasion by • Strong seasonal demand profile • Sole local asphalt producer
independent refiners • Jet fuel sales through proprietary
• April WY 3.2.1 up 38% over March
• Low RINs exposure pipeline to military base
• April Sing 3.1.2 up 36% over March • Low RINs exposure
• April PNW 5.2.2.1 up 42% over
March
1. 2022 forwards data based on 3 day average forward pricing as of 4/29/2022 for the balance of the year. Singapore 6
forwards based on the Platts Singapore "market-on-close.“ WY 3.2.1 index includes E10 pricing markers which embed RVO
costs.Distillate-Oriented Yield Profile
Distillate Cracks ($/bbl) 2021 System-wide Yield
59% Distillates &
Low Sulfur Fuel Oil
13% Asphalt,
VGO & Other
28% Gasoline
59% distillate & LSFO yield system-wide
compared to US industry average of 37% 1
7 1. Source: https://www.eia.gov/dnav/pet/pet_pnp_pct_dc_nus_pct_a.htm;
US industry average comparison includes 2021 Kerosene Jet Fuel + Kerosene + Distillate Fuel Oil +
Residual Fuel Oil.Multimodal Logistics System
Western
Canada
11 Kauai
Seattle
WA REFINERY
Oahu
29
WA Spokane
HI REFINERY Molokai Bakken
Maui
Portland MT ND
Global Crude 61
6
Sourcing
Billings
OR
Boise
Hawaii ID
PRB SD
Rapid City
12
WY REFINERY
Asset Detail WY
Hawaii (1) Wyoming Washington Par Pacific
Storage Capacity (MMBbls) 5.4 0.7 2.8 8.9 Cheyenne
NE
NV Salt Lake City
Marine Assets (2) 2 - 1 3
Denver
Miles of Pipeline 27 138 14 179 UT
CO
Rail Facility ✓ ✓ 2
Marine Terminal ✓ ✓ 2
Las Vegas
Renewables System ✓ 1
Truck Rack ✓ ✓ ✓ 3
Refinery Retail Locations Renewables
Diverse logistics assets enable flexibility and development
of integrated downstream system Trucks Rail Barge Movements
1 Owned storage capacity. Crude Inflows Refined Products Inflows/Outflows
2 Leased marine barges and ships. 8
Renewable Fuels Inflows/OutflowsLeading Retail Position in Attractive Markets
Hawaii Retail
• 90 locations across four islands
• 34 company-operated convenience stores
• Dual-branded retail network to attract and retain broad customer base
• Hele – proprietary local brand
• 76 – exclusive license
• High real estate costs, scarcity of land, and logistics complexity strengthen
competitive position
• Expanding private label merchandise and food service offerings
Northwest Retail
• 29 company-operated locations in Washington and Idaho
• Proprietary nomnom brand
• Attractive fuel supply opportunities enhancing margins
• Expanding merchandising assortment and food offerings including private
label merchandise to drive and increase margin capture
• Expansion opportunities in active driving market
• New Spokane location expected to break ground year end 2022
9Stable Contribution from Retail and Logistics Segments
Trending Retail & Logistics Adj. EBITDA ($MM)
$135
$122 $121 $118
59
47 45
65
76 73 73
57
2019 2020 2021 Q1-22 LTM
Logistics Retail
Totals may not foot due to rounding. See appendix for non-GAAP reconciliations.
10Capital Expenditure and Turnaround Summary
$113
$94
$75-85
$10 $50
$35
$55 $19
$39
$15
$9
$45
$29 $29 $35
2019 2020 2021 2022 Guidance
Chart in $ millions. Maintenance, Regulatory, and IT Growth Turnaround
Turnaround Estimated Outlay Cycle Last Turnaround
Hawaii (Par East) $40 million 3-5 years Q3 2020
Washington $35 million 3-5 years Q1 2022
Wyoming $15 million 4-5 years Q4 2020
10 year estimated turnaround outlay of $180-200 million; next planned turnaround in 2024
11Trending Net Debt
Debt Balances ($ millions) 12/31/2019 12/31/2020 12/31/2021 3/31/2022
7.75% Senior Secured Notes $300 $300 $296 $296
12.875% Senior Secured Notes - 105 68 68
Term Loan B 241 228 216 213
Retail Loans 45 50 - -
ABL Credit Facility - - - 25
Total Secured Debt 586 683 580 602
5% Convertible Note 49 49 - -
Total Debt 635 732 580 602
Cash 126 68 112 141
Net Debt $509 $664 $468 $461
12Laramie Energy
Asset Highlights Key Performance Indicators 2
Q1-22
• Par Pacific has a 46.0% ownership interest in Laramie Energy 2019 2020 2021 LTM
• Given the improvement in the natural gas market, Par Pacific is Equivalent Production (Mmcfe/d) 212.8 164.3 125.1 116.7
evaluating strategic options regarding its investment in Laramie Energy
• Largely contiguous acreage position with ~190,000 net leasehold acres Financial Performance ($MM)
(~84% NRI) and ~20,000 net fee mineral acres in Western Colorado and Adjusted EBITDAX $74 $41 $121 $89
25,000 owned surface acres Capital Expenditures 65 3 1 2
Unrealized Derivative Gain (Loss) 4 (4) (32) (76)
• Laramie’s Net Debt to Hedged Adjusted EBITDAX reduced from 4.4x at Net Income (Loss) (25) (23) 32 (41)
year-end 2020 to 0.8x at year-end 2021
• Forecasted production is currently hedged 69% in 2022, 66% in 2023, Net Debt ($MM)
and 61% in 2024 Debt $201 $200 $140 $127
Gross Debt / Adjusted EBITDAX 2.7x 4.9x 1.2x 1.4x
• $0.67 free cashflow 1 per share that is not reflected in Par Pacific’s Q1 Net Debt $201 $179 $92 $71
2022 LTM adjusted net income Net Debt / Adjusted EBITDAX 2.7x 4.4x 0.8x 0.8x
• 7 well completion program beginning in Q2 2022 for $11 million in Preferred Equity $45 $52 $60 $62
capital spend
1 Laramie free cashflow is defined as Adjusted EBITDAX less Capital Expenditures. Free cashflow per share calculation
• 2022 equivalent production is forecasted to average 105-110 Mmcfe/day incorporates Par Pacific’s 46% ownership interest and weighted average shares outstanding for Q1 2022 LTM period.
2 See slide 21 for non-GAAP reconciliations.
13Energy Transition Strategy
Leverage local resources and policies to meet local needs
Short Term: Renewable Co-feeding Opportunity
• Opportunity to invest a small amount of capital and co-feed low carbon feedstocks like soybean oil at our Washington refinery
• Quickly actionable project which allows flexibility to toggle between renewables and hydrocarbons
• ~2,250 bpd of co-fed soybean oil would generate enough RINs to fully offset our systemwide renewable volume obligation
Long Term Projects
Washington Hydrogen Hawaii Carbon Capture & Sequestration
• Washington LCFS and Cap & Trade programs provide incentives for • Hawaii does not currently have policies in place to incentivize
decarbonization decarbonization
• Low-cost hydroelectric power makes Tacoma an advantaged region to • We are focused on opportunities to lower our carbon footprint
deploy electrolyzer technology and produce green hydrogen through carbon capture & sequestration
• U.S. Oil’s unique logistics infrastructure and positioning in the Port of • Hawaii (Par East) hydrogen plant produces a high-purity vent
Tacoma makes it a prime candidate within the region stream of CO2 which is ideal for capturing and our team is
evaluating a number of sequestration opportunities
14Company Highlights
• Improving regional market fundamentals
• Benefiting from regional refining closures and improving global mobility trends
Improving Refining & • Distillate-heavy production uniquely positions Par Pacific to capture improving market fundamentals
Logistics Position • Completion of three turnarounds expected to create clear pathway for free cash flow generation
• Logistics assets serve as essential energy infrastructure to fulfill refined product demand
• Actively pursuing low-emission fuels opportunities in Hawaii and Washington
• Steady earnings from retail segment balances refining cyclicality
• Strong retail segment contribution despite margin compression from rising crude prices
Strong Retail
Franchise • Successful rebranding of Northwest retail locations to nomnom brand
• Expanding private label merchandising and other food service offerings provides opportunity for increased
margin capture
• Significant free cash flow generation expected
• $150+ million of debt reduction in 2021 simplifies capital structure
Financial Profile
• $1.6 billion in tax attributes enhances cash flow
• Improving fundamentals in minority-owned interest in Laramie Energy
15Appendix 16
Singapore 3.1.2 Crack Spread
$18
Singapore 3.1.2 Crack
5-Yr Average
5-Yr Average 1 = $8.63
$14
$10
$6
$2
($2)
1Q 19 2Q 19 3Q 19 4Q 19 1Q 20 2Q 20 3Q 20 4Q 20 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22
($/bbl)
Singapore 3.1.2 Crack $9.15 $9.39 $12.41 $12.12 $8.11 -$0.14 $1.92 $2.63 $3.80 $4.38 $6.20 $10.49 $16.21
Average Brent Price $63.83 $68.47 $62.03 $62.42 $50.82 $33.39 $43.34 $45.26 $61.32 $69.08 $73.23 $79.66 $97.90
1 Company calculation based on a rolling five-year quarterly average
Singapore 3-1-2 Daily: computed by taking 1 part gasoline (RON 92) and 2 parts middle distillates (Sing Jet & Sing Gasoil) as cr eated from a barrel of Brent Crude.
Month (CMA): computed using all available pricing days for each marker.
Quarter/Year: computed using calendar day weighted CMAs for each marker.
17Wyoming 3.2.1 Crack Spread
5-Yr Average 1 = $23.78
Wyoming 3.2.1 Crack
$40
5-Yr Average
$30
$20
$10
$0
1Q 19 2Q 19 3Q 19 4Q 19 1Q 20 2Q 20 3Q 20 4Q 20 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22
($/bbl)
Wyoming 3.2.1 Crack $15.09 $28.89 $27.32 $28.26 $15.86 $17.39 $19.63 $18.45 $20.97 $30.04 $41.78 $23.67 $26.53
Average WTI Price $54.90 $59.91 $56.44 $56.87 $45.98 $28.00 $40.92 $42.70 $58.14 $66.17 $70.52 $77.10 $95.01
1 Company calculation based on a rolling five-year quarterly average
Rapid City Daily: Computed by taking 2 parts gasoline and 1 part distillate (ULSD) as created from three barrels of West Texa s Intermediate Crude (WTI).
Denver Daily: Computed by taking 2 parts gasoline and 1 part distillate (ULSD) as created from three barrels of WTI.
Wyoming 3-2-1 Daily: computed using a weighted average of 50% Rapid City and 50% Denver.
Month (CMA): computed using all available pricing days for each marker.
Quarter/Year: computed using calendar day weighted CMAs for each marker.
18Pacific Northwest 5.2.2.1 Crack Spread
$25 Pacific Northwest 5.2.2.1
5-Yr Average 1 = $14.93
5-Yr Average
$20
$15
$10
$5
$0
1Q 19 2Q 19 3Q 19 4Q 19 1Q 20 2Q 20 3Q 20 4Q 20 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22
($/bbl)
Pacific Northwest 5.2.2.1 $10.93 $17.14 $14.76 $16.58 $13.24 $11.92 $9.39 $11.26 $11.46 $16.05 $18.59 $17.64 $21.88
Average ANS Price $64.15 $69.40 $63.63 $65.51 $52.27 $28.17 $43.11 $43.68 $61.65 $69.44 $73.83 $80.61 $99.56
1 Company calculation based on a rolling five-year quarterly average.
Pacific Northwest 5-2-2-1 Daily: computed by taking 2 parts gasoline (PNW Suboctane), 2 parts middle distillates (PNW ULSD & PNW Jet), and 1 part fuel oil (SF 180 Waterborne) as created from a barrel of Alask an North Slope Crude.
ANS price: calculated using the Argus ANS-Brent differential beginning in July 2017. Prior to July 2017, a blended Platts and Argus ANS-WTI differential was used.
Month (CMA): computed using all available pricing days for each marker.
Quarter/Year: computed using calendar day weighted CMAs for each marker.
19Corporate Structure
Par Pacific Holdings Inc.
NYSE: PARR
ABL Revolver
due 2/2/2025 1
$296 MM 7.75% Senior Secured Notes
due 12/15/2025
$209 MM L + 6.75% Term Par Petroleum, LLC
Loan B due 1/11/2026
$68 MM 12.875% Senior Secured Notes
due 1/15/2026
Hermes
Laramie Energy,
Supply and Offtake Par Hawaii Consolidated, LLC
Agreement Par Hawaii, LLC Par Tacoma, LLC LLC
Refining, LLC d/b/a Wyoming
46% Interest
Refining Company
Intermediation
Note: Chart omits certain intermediate subsidiaries between parent and operating subsidiaries for brevity. Debt balances outstanding as of April 29, 2022, unless otherwise stated.
Agreement
1. $142.5 mm ABL Revolver with a sublimit of $15 mm for swingline loans and a sublimit of $65 mm for the issuance of standby or commercial letters of credit. Co-borrowers are Par Petroleum, LLC, a
Delaware limited liability company, Par Hawaii, LLC, a Delaware limited liability company, Hermes Consolidated, LLC (d/b/a Wyoming Refining Company), a Delaware limited liability company, and
Wyoming Pipeline Company LLC, a Wyoming limited liability company.
20Laramie Energy Adjusted EBITDAX
Laramie Energy Net Income (Loss) Reconciliation to Adjusted EBITDAX (1) ($ in thousands)
Twelve Months Ended
12/31/2019 12/31/2020 12/31/2021 3/31/2022
Net income (loss) $ (380,474) $ (22,589) $ 32,476 $ (40,875)
Commodity derivative (gain) loss 1,193 2,201 42,995 93,249
Gain (loss) on settled derivative instruments (5,476) 2,045 (10,578) (17,628)
Interest expense 11,879 9,402 17,155 17,121
Gain on extinguishment of debt - - (695) (695)
Non-cash preferred dividend 4,115 6,810 7,224 7,481
Depreciation, depletion, amortization, and accretion 85,189 37,960 28,860 27,285
Impairment loss 355,220 - - -
Exploration and geological and geographical expense 330 275 342 308
Bonus accrual, net (2,154) 436 602 27
Equity based compensation expense 122 16 - -
(Gain) loss on disposal of assets 1,478 (102) (6) 37
Pipeline deficiency accrual (1,162) - - -
Abandoned property and expired acreage 3,536 4,099 2,667 2,578
Total Adjusted EBITDAX $ 73,796 $ 40,553 $ 121,042 $ 88,888
(1) Laramie Adjusted EBITDAX is defined as net income (loss) excluding commodity derivative (gains)/losses, gains/(losses) on settled der ivative instruments, interest expense, gain on extinguishment of
debt, non-cash preferred dividends, depreciation, depletion, amortization, and accretion, impairment loss, exploration and geolo gical and geographical expense, bonus accrual, net, equity-based
compensation expense, loss (gain) on disposal of assets, pipeline deficiency accrual, and abandoned property and expired acreage (non-cash). We believe Adjusted EBITDAX is a useful supplemental
financial measure to evaluate the economic and operational performance of exploration and production companies such as Laramie Energy. Adjusted EBITDAX presented by other companies may not
be comparable to our presentation as other companies may define these terms differently.
21Non-GAAP Financial Measures
Twelve Months Ended Consolidated Adjusted EBITDA and Adjusted Net Income Reconciliation (1)
($ in thousands) 2019 2020 2021 Q1 2022
Net income (loss) $ 40,809 $ (409,086) $ (81,297) $ (156,121)
Adjustments to Net Income (loss):
Inventory valuation adjustment 19,436 9,994 31,841 89,408
LIFO liquidation inventory adjustment — — — (1,888)
RINs loss (gain) in excess of net obligation (3,398) 44,071 16,967 (4,547)
Unrealized loss (gain) on derivatives 8,988 (4,804) 1,517 20,981
Acquisition and integration costs 4,704 614 87 (288)
Debt extinguishment and commitment costs 11,587 — 8,144 6,637
Changes in valuation allowance and other deferred tax items (2) (68,792) (20,896) — —
Change in value of common stock warrants 3,199 (4,270) — —
Severance costs — 512 84 2,296
Gain on sale of assets, net — — (64,697) 215
Impairment expense — 85,806 1,838 1,838
Impairments of Laramie Energy, LLC (3) 83,152 45,294 — —
Par's share of Laramie Energy's unrealized loss (gain) on derivatives (1,969) (1,110) — —
Adjusted Net Income (Loss) 97,716 (253,875) (85,516) (41,469)
Depreciation, depletion and amortization 86,121 90,036 94,241 95,141
Interest expense and financing costs, net 74,839 70,222 66,493 64,736
Equity losses from Laramie Energy, LLC, excluding Par's share of
unrealized loss (gain) on derivatives and impairment losses 8,568 2,721 — —
Income tax expense (benefit) (897) 176 1,021 584
Adjusted EBITDA $ 266,347 $ (90,720) $ 76,239 $ 118,992
_____________________________________________
(1) We believe Adjusted Net Income (Loss) and Adjusted EBITDA are useful supplemental financial measures that allow investors to assess: (1) The financial performance of our assets without regard to financing methods, capital structure or historical co st basis, (2) The
ability of our assets to generate cash to pay interest on our indebtedness, and (3) Our operating performance and return on invested capital as compared to other companies without regard to financing methods and capital structure. Adjusted Net Income (Loss) and
Adjusted EBITDA should not be considered in isolation or as a substitute for operating income (loss), net income (loss), cash flows provided by operating, investing and financing activities, or other income or cash flow statement data prepared in accordance with
GAAP. Adjusted Net Income (Loss) and Adjusted EBITDA presented by other companies may not be comparable to our presentation as other companies may define these terms differently. Beginning with financial results reported for periods in fiscal year 2022, the
inventory valuation adjustment was modified to include the first-in, first-out (“FIFO”) inventory gains (losses) associated with the our titled manufactured inventory in Hawaii. Adjusted Net Income and Adjusted EBITDA have been recast for prior periods w hen
reported to conform to the modified presentation. For the twelve months ended 2019, 2020, 2021, Q1 2022, there was no change in value of contingent consideration.
(2) Includes increases in (releases of) our valuation allowance associated with business combinations and changes in deferred tax assets and liabilities that are not offset by a change in the valuation allowance. These tax expenses (benefits) are included in Income tax
benefit on our condensed consolidated statements of operations. 22
(3) Included in Equity losses from Laramie Energy, LLC on our condensed consolidated statements of operations.Non-GAAP Financial Measures
Consolidated Adjusted EBITDA by Segment Reconciliation (1)
For the twelve months ended March 31, 2022
($ in thousands)
Corporate and
Refining Logistics Retail Other
Operating income (loss) $ (116,259) $ 50,934 $ 35,939 $ (54,667)
Adjustments to operating income (loss):
Depreciation, depletion and amortization 59,527 21,877 10,911 2,826
Inventory valuation adjustment 89,408 — — —
LIFO liquidation inventory adjustment (1,888) — — —
RINs loss in excess of net obligation (4,547) — — —
Unrealized loss on derivatives 20,981 — — —
Acquisition and integration costs — — — (288)
Severance costs 98 7 — 2,191
Loss (gain) on sale of assets, net 1,600 (19) (1,381) 15
Impairment expense 1,838 — — —
Other income/expense — — — (111)
Adjusted EBITDA $ 50,758 $ 72,799 $ 45,469 $ (50,034)
_____________________________________________
(1) Adjusted EBITDA by segment is defined as Operating income (loss) by segment excluding depreciation, depletion, and amortization expense, inventory valuation adjustment (which adjusts for timing differences to
reflect the economics of our inventory financing agreements, including lower of cost or net realizable value adjustments, the impact of the embedded derivative repurchase or terminal obligations, contango (gains)
and backwardation losses associated with our Washington inventory and intermediation obligation, and purchase price allocation adjustments), the LIFO layer liquidation impacts associated with our Washington
inventory, RINs loss (gain) in excess of net obligation, unrealized loss (gain) on derivatives, acquisition and integration costs, severance costs, loss (gain) on sale of assets, and impairment expense. Adjusted EBITDA by
segment also includes Gain on curtailment of pension obligation and Other income (expense), net, which are presented below operating income (loss) on our condensed consolidated statements of operations.
Beginning with financial results reported for periods in fiscal year 2022, the inventory valuation adjustment was modified to include the first-in, first-out (“FIFO”) inventory gains (losses) associated with our titled
manufactured inventory in Hawaii. Adjusted EBITDA by Segment has been recast for prior periods when reported to conform to the modified presentation. Adjusted EBITDA by segment presented by other companies
may not be comparable to our presentation as other companies may define these terms differently. For the twelve months ended March 31, 2022, there was no gain on curtailment of pension obligation.
23Non-GAAP Financial Measures
Consolidated Adjusted EBITDA by Segment Reconciliation (1)
For the twelve months ended December 31, 2021
($ in thousands)
Corporate and
Refining Logistics Retail Other
Operating income (loss) $ (88,799) $ 51,159 $ 81,249 $ (51,228)
Adjustments to operating income (loss):
Depreciation, depletion and amortization 58,258 22,044 10,880 3,059
Inventory valuation adjustment 31,841 — — —
RINs loss in excess of net obligation 16,967 — — —
Unrealized loss on derivatives 1,517 — — —
Acquisition and integration costs — — — 87
Severance costs 61 23 — —
Loss (gain) on sale of assets, net (19,659) (19) (45,034) 15
Impairment expense 1,838 — — —
Gain on curtailment of post-retirement medical
plan obligation 1,802 228 2 —
Other income/expense — — — (52)
Adjusted EBITDA $ 3,826 $ 73,435 $ 47,097 $ (48,119)
_____________________________________________
(1) Please read slide 23 for the definition of Adjusted EBITDA by segment used herein. Beginning in the third quarter of 2020, Adjusted EBITDA by
segment excludes the LIFO layer liquidation impacts associated with our Washington inventory. There was no LIFO liquidation adjustment for the
twelve months ended December 31, 2020. Beginning with financial results reported for periods in fiscal year 2022, the inventory valuation
adjustment was modified to include the first-in, first-out (“FIFO”) inventory gains (losses) associated with our titled manufactured inventory in
Hawaii. Adjusted EBITDA by Segment has been recast for prior periods when reported to conform to the modified presentation.
24Non-GAAP Financial Measures
Consolidated Adjusted EBITDA by Segment Reconciliation (1)
For the twelve months ended December 31, 2020
($ in thousands)
Corporate and
Refining Logistics Retail Other
Operating income (loss) $ (331,826) $ 35,044 $ 24,211 $ (45,427)
Adjustments to operating income (loss):
Depreciation, depletion and amortization 53,930 21,899 10,692 3,515
Inventory valuation adjustment 9,994 — — —
RINs loss in excess of net obligation 44,071 — — —
Unrealized loss on derivatives (4,804) — — —
Acquisition and integration costs — — — 614
Severance costs 312 8 — 192
Impairment expense 55,989 — 29,817 —
Other income/expense — — — 1,049
Adjusted EBITDA $ (172,334) $ 56,951 $ 64,720 $ (40,057)
_____________________________________________
(1) Please read slide 23 for the definition of Adjusted EBITDA by segment used herein. Beginning in the third quarter of 2020, Adjusted EBITDA by
segment excludes the LIFO layer liquidation impacts associated with our Washington inventory. There was no LIFO liquidation adjustment for the
twelve months ended December 31, 2020. Beginning with financial results reported for periods in fiscal year 2022, the inventory valuation
adjustment was modified to include the first-in, first-out (“FIFO”) inventory gains (losses) associated with our titled manufactured inventory in
Hawaii. Adjusted EBITDA by Segment has been recast for prior periods when reported to conform to the modified presentation. For the twelve
months ended December 31, 2020, there was no gain on curtailment of post retirement medical plan obligation.
25Non-GAAP Financial Measures
Consolidated Adjusted EBITDA by Segment Reconciliation (1)
For the twelve months ended December 31, 2019
($ in thousands)
Corporate and
Refining Logistics Retail Other
Operating income (loss) $ 93,781 $ 59,075 $ 49,245 $ (54,121)
Adjustments to operating income (loss):
Depreciation, depletion and amortization 55,832 17,017 10,035 3,237
Inventory valuation adjustment 19,436 — — —
RINs loss in excess of net obligation (3,398) — — —
Unrealized loss on derivatives 8,988 — — —
Acquisition and integration costs — — — 4,704
Other income/expense — — — 2,516
Adjusted EBITDA $ 174,639 $ 76,092 $ 59,280 $ (43,664)
_____________________________________________
(1) Please read slide 23 for the definition of Adjusted EBITDA by segment used herein. Beginning with financial results reported for periods in fiscal
year 2022, the inventory valuation adjustment was modified to include the first-in, first-out (“FIFO”) inventory gains (losses) associated with our
titled manufactured inventory in Hawaii. Adjusted EBITDA by Segment has been recast for prior periods when reported to conform to the modified
presentation. For the twelve months ended December 31, 2019, there was no severance cost, impairment expense, or gain on curtailment of post
retirement medical plan obligation.
26Non-GAAP Financial Measures
Consolidated Adjusted EBITDA and Adjusted Net Income Reconciliation (1)
For the trailing twelve quarters ended Q1 2022
($ in thousands)
Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022
Net income (loss) $ 28,169 $ (83,891) $ 35,439 $ (222,337) $ (40,560) $ (14,271) $ (131,918) $ (62,227) $ (108,958) $ 81,802 $ 8,086 $ (137,051)
Adjustments to Net Income (loss):
Inventory valuation adjustment (23,568) 22,367 11,340 56,626 (30,238) (40,509) 24,115 23,086 29,657 2,784 (23,686) 80,653
LIFO liquidation inventory adjustment — — — — — 6,211 (6,211) 1,888 2,263 (4,151) — —
RINs loss (gain) in excess of net obligation 2,713 (1,240) (359) 6,602 10,738 645 26,086 28,770 25,207 (42,103) 5,093 7,256
Unrealized loss (gain) on derivatives 14,335 (15,154) 3,465 22,876 (22,431) (4,952) (297) (4,012) 1,404 10,228 (6,103) 15,452
Acquisition and integration costs 818 623 379 665 90 (155) 14 438 (352) 1 — 63
Debt extinguishment and commitment costs 3,690 — 2,401 — — — — 1,507 6,628 9 — —
Changes in valuation allowance and other
deferred tax items (2) (2,318) (2,751) 1,628 (18,373) (2,714) — 191 — — — — —
Change in value of common stock warrants 957 826 134 (4,270) — — — — — — — —
Change in value of contingent consideration — — — — — — — — — — — —
Severance costs — — — 149 96 — 267 16 — 59 9 2,228
Gain on sale of assets, net — — — — — — — (64,912) 510 2 (297) —
Impairment expense — — — 67,922 — — 17,884 — — — 1,838 —
Impairments of Laramie Energy, LLC (3) — 81,515 1,637 45,294 — — — — — — — —
Par's share of Laramie Energy's unrealized
loss (gain) on derivatives (3) (3,859) 1,961 1,160 (1,110) — — — — — — — —
Adjusted Net Income (Loss) 20,937 4,256 57,224 (45,956) (85,019) (53,031) (69,869) (75,446) (43,641) 48,631 (15,060) (31,399)
Depreciation, depletion and amortization 21,919 22,227 21,018 21,283 22,128 22,821 23,804 22,880 23,548 23,618 24,195 23,780
Interest expense and financing costs, net 20,278 18,348 17,503 18,674 16,414 17,523 17,611 18,151 17,186 15,374 15,782 16,394
Equity losses from Laramie Energy, LLC,
excluding Par's share of unrealized loss (gain)
on derivatives and impairment losses 3,368 2,157 2,113 847 1,874 — — — — — — —
Income tax expense (benefit) 513 323 (2,315) 126 (2) 108 (56) — 607 586 (172) (437)
Adjusted EBITDA $ 67,015 $ 47,311 $ 95,543 $ (5,026) $ (44,605) $ (12,579) $ (28,510) $ (34,415) $ (2,300) $ 88,209 $ 24,745 $ 8,338
2019-2020 RINs mark-to-market loss/(gain) 637 611 (1,845) 2,670 5,708 6,400 22,860 46,888 27,311 (29,074) 926 4,978
Adjusted EBITDA excl. 2019-2020 RINs MTM $ 67,652 $ 47,922 $ 93,698 $ (2,356) $ (38,897) $ (6,179) $ (5,650) $ 12,473 $ 25,011 $ 59,135 $ 25,671 $ 13,316
_____________________________________________
1. Please read slide 22 for the definitions of Adjusted Net Income (Loss) and Adjusted EBITDA used herein. 27
2. Includes increases in (releases of) our valuation allowance associated with business combinations and changes in deferred tax assets and liabilities that are not offset by a change in the valuation allowance. These tax expenses (benefits)
are included in Income tax benefit on our condensed consolidated statements of operations.
3. Included in Equity losses from Laramie Energy, LLC on our condensed consolidated statements of operations.Non-GAAP Financial Measures
Diluted Adjusted Net Income per Share for the Twelve Months Ended
(in thousands, except per share amounts)
2019 2020 2021 Q1 2022
Adjusted Net Income (Loss) $ 97,716 $ (253,875) $ (85,516) $ (41,469)
Undistributed Adjusted Net Income allocated to participating securities (1) 1,048 — — —
Adjusted Net Income (Loss) attributable to common stockholders 96,668 (253,875) (85,516) (41,469)
Plus: effect of convertible securities 8,978 — — —
Numerator for diluted Adjusted Net Income (Loss) per common share $ 105,646 $ (253,875) $ (85,516) $ (41,469)
Basic weighted-average common stock shares outstanding 50,352 53,295 58,268 59,507
Add dilutive effects of common stock equivalents (2) 5,240 — — —
Diluted weighted-average common stock shares outstanding 55,592 53,295 58,268 59,507
Basic Adjusted Net Income (Loss) per common share $ 1.92 $ (4.76) $ (1.47) $ (0.70)
Diluted Adjusted Net Income (Loss) per common share $ 1.90 $ (4.76) $ (1.47) $ (0.70)
_____________________________________________
(1) Participating securities include restricted stock that has been issued but had not yet vested. These shares vested during the year ended December 31, 2019.
(2) Entities with a net loss from continuing operations are prohibited from including potential common shares in the computation of diluted per share amounts.
We have utilized the basic shares outstanding to calculate both basic and diluted Adjusted Net Loss per common share for the twelve months ended
December 31, 2021 and March 31, 2022.
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