Marathon Petroleum Reports Second-Quarter 2012 Results
(Thomson Reuters ONE) -
* Continued strong performance driven by wider refining margins
* Period-over-period growth in Speedway segment income
* Registration statement filed for initial public offering of a midstream MLP
* Initial $850 million share repurchase program completed
* Dividend increased 40 percent
* Detroit Heavy Oil Upgrade Project on budget and on schedule
FINDLAY, Ohio, July 31, 2012 - Marathon Petroleum Corporation (NYSE: MPC) today
reported second quarter net income of $814 million, or $2.38 per diluted share,
compared with net income of $802 million, or $2.24 per diluted share, in the
second quarter of 2011. For the second quarter of 2012, net income adjusted for
special items was $867 million, or $2.53 per diluted share, compared with net
income adjusted for special items of $819 million, or $2.29 per diluted share
for the second quarter of 2011.
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Three Months Ended
June 30
(In millions, except per-diluted-share data) 2012 2011
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Net income $ 814 $ 802
Adjustments for special items (net of taxes):
Pension settlement expenses 53 -
Income tax law changes - 17
Net income adjusted for special items((a)) $ 867 $ 819
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Net income - per diluted share $ 2.38 $ 2.24
Adjusted net income - per diluted share $ 2.53 $ 2.29
Weighted average shares - diluted 341 358
Revenues and other income $ 20,257 $ 20,794
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(a) Net income adjusted for special items is a financial measure not in
accordance with generally accepted accounting principles (GAAP) and should not
be considered a substitute for net income as determined in accordance with
accounting principles generally accepted in the United States. See below for
further discussion of net income adjusted for special items.
"Our operational flexibility and location of our assets enabled us to optimize
operations and capture value from dynamic market conditions to produce strong
earnings," said MPC President and Chief Executive Officer Gary R. Heminger.
"With our refining capacity balanced almost evenly between the Midwest and the
U.S. Gulf Coast, we were able to take advantage of strong crack spreads and
increasing production of Canadian and unconventional crudes. At the same time,
Speedway achieved a 34 percent increase in segment income over the second
quarter of 2011, due primarily to an increase in merchandise and refined product
margins."
Heminger also noted that MPC took an important strategic step on July 2 by
filing a registration statement in anticipation of a proposed initial public
offering of common units of MPLX LP, a master limited partnership. MPLX LP, a
wholly owned subsidiary of MPC, was formed as MPC's primary vehicle to own,
operate, develop and acquire crude oil pipelines, hydrocarbon-based products
pipelines and other midstream assets. An application is being made to list the
common units on the New York Stock Exchange under the symbol "MPLX."
Heminger also provided updates on other recent and ongoing MPC initiatives.
"During the second quarter, Speedway completed the acquisition and integration
of 87 GasAmerica locations. In mid-July, Speedway completed the acquisition and
integration of 10 Road Ranger locations," said Heminger. "Our Detroit Heavy Oil
Upgrade Project also continues to be on budget and on schedule, and we expect it
to be operational by year-end. This investment is intended to enhance margins by
equipping the refinery to process lower cost feedstocks, including Canadian
bitumen-type crudes."
Commenting on the company's recently completed $850 million accelerated share
repurchase program, Heminger said it represented an important component of MPC's
ongoing plan to return capital to shareholders with $1.15 billion remaining
under the current $2 billion share repurchase authorization. "We remain
committed to maximizing total returns to our shareholders, and recognize the
trust our investors have placed in us to exercise discipline in the allocation
of capital," he said. "We will continue to strike a balance between making
value-enhancing investments in our business and returning capital to
shareholders. Our recent decision to increase the quarterly dividend from 25
cents to 35 cents per share further underscores this commitment."
Segment Results
Total income from operations was $1,307 million in the second quarter of 2012,
compared with $1,325 million in the second quarter of 2011.
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Three Months Ended
June 30
(In millions) 2012 2011
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Income from Operations by Segment
Refining & Marketing $ 1,325 $ 1,260
Speedway 107 80
Pipeline Transportation 50 54
Items not allocated to segments:
Corporate and other unallocated items (92) (69)
Pension settlement expenses (83) -
Income from operations $ 1,307 $ 1,325
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Refining & Marketing
Refining & Marketing segment income from operations was $1,325 million in the
second quarter of 2012, compared with $1,260 million in the second quarter of
2011. The $65 million increase was principally the result of a higher Refining &
Marketing gross margin, which increased to $11.13 per barrel in the second
quarter of 2012 from $10.78 per barrel in the second quarter of 2011. The
primary factor contributing to the increase in the gross margin was a higher
Chicago and U.S. Gulf Coast LLS 6-3-2-1 blended crack spread, which increased to
$8.46 per barrel in the second quarter of 2012 from $5.53 per barrel in the
second quarter of 2011.
As of June 30, 2012, the Detroit Heavy Oil Upgrade Project was 96 percent
complete and remains on budget and on schedule for expected construction
completion in the third quarter of 2012. Immediately following, there will be a
70-day planned turnaround, with the upgraded refinery anticipated to be online
by year-end.
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Three Months Ended
June 30
(mbpd = thousand barrels per day) 2012 2011
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Key Refining & Marketing Statistics
Refinery throughputs (mbpd)
Crude oil refined 1,208 1,196
Other charge & blendstocks 131 176
Total 1,339 1,372
Refined product sales volume (mbpd)((a)) 1,571 1,561
Refining & Marketing gross margin $ 11.13 $ 10.78
($/barrel)((b))
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(a) Includes intersegment sales
(b) Sales revenue less cost of refinery inputs, purchased products and
manufacturing expenses, including depreciation and amortization, divided by
Refining & Marketing segment refined product sales volume.
Speedway
Speedway segment income from operations was $107 million in the second quarter
of 2012, compared with $80 million in the second quarter of 2011. The $27
million increase was primarily the result of higher merchandise, gasoline and
distillates gross margins, partially offset by an increase in operating
expenses. Speedway gasoline and distillates gross margin per gallon averaged
16.39 cents in the second quarter of 2012, compared with 15.02 cents in the
second quarter of 2011.
Speedway same-store merchandise sales increased 2.2 percent in the second
quarter of 2012, compared with a 0.3 percent increase in the second quarter of
2011. Same-store gasoline sales volume increased 2.1 percent in the second
quarter of 2012, compared with a decrease of 4.5 percent in the second quarter
of 2011.
During the second quarter of 2012, Speedway completed the acquisition and
integration of 87 GasAmerica locations throughout Indiana and Ohio. This
acquisition supports MPC's strategy to increase Speedway sales volumes and
complements the company's existing network of assets.
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Three Months Ended
June 30
2012 2011
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Key Speedway Statistics
Gasoline and distillates sales (million gallons) 756 725
Gasoline and distillates gross margin ($/gallon)((a)) $ 0.1639 $ 0.1502
Merchandise sales (in millions) $ 776 $ 743
Merchandise gross margin (in millions) $ 203 $ 178
Convenience stores at period end 1,455 1,378
Same-store gasoline sales volume (period over period) 2.1% (4.5%)
Same-store merchandise sales (period over period) 2.2% 0.3%
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(a) The price paid by consumers less the cost of refined products, including
transportation and consumer excise taxes, and the cost of bankcard processing
fees, divided by gasoline and distillates sales volume.
Pipeline Transportation
Pipeline Transportation segment income from operations was $50 million in the
second quarter of 2012, compared with $54 million in the second quarter of
2011. The decrease was primarily due to a decrease in pipeline affiliate income.
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Three Months Ended
June 30
2012 2011
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Key Pipeline Transportation Statistics
Pipeline throughput (mbpd)((a))
Crude oil pipelines 1,193 1,221
Refined product pipelines 954 1,014
Total 2,147 2,235
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(a) On owned common-carrier pipelines, excluding equity method investments.
Corporate and Special Items
Corporate and other unallocated expenses increased $23 million in the second
quarter of 2012 compared with the second quarter of 2011. The increase primarily
reflects the impact of being a stand-alone company in 2012 compared to expenses
incurred prior to the June 30, 2011 spinoff. During the second quarter of 2012,
we recorded pretax cumulative pension settlement expenses of $83 million
resulting from the level of employee lump sum retirement distributions occurring
in 2012. During the second quarter of 2011, state income tax legislative changes
were enacted, primarily in Michigan, resulting in an adverse tax impact of $17
million.
Strong Financial Position and Liquidity
On June 30, 2012, the company had $1.9 billion in cash and cash equivalents, an
unused $2 billion revolving credit agreement and a $1 billion unused trade
receivables securitization facility. The company's credit facilities and cash
position should provide the company with sufficient flexibility to meet its day-
to-day operational needs and continue its balanced approach to investing in the
business and returning capital to shareholders. As of June 30, 2012, the
company's strong financial position was further reflected by its debt-to-total-
capital ratio of 24 percent.
Conference Call
At 10 a.m. EDT today, MPC will hold a webcast and conference call to discuss the
earnings release and provide an update on company operations. Interested parties
may listen to the conference call on MPC's website at
http://www.marathonpetroleum.com by clicking on the "2012 Second-Quarter
Financial Results" link. Replays of the conference call will be available on the
company's website through Thursday, August 16. Financial information, including
the earnings release and other investor-related material, will also be available
online prior to the webcast and conference call at
http://ir.marathonpetroleum.com in the Quarterly Investor Packet.
###
About Marathon Petroleum Corporation
MPC is the nation's fifth-largest refiner, with a crude oil capacity of
approximately 1.2 million barrels per calendar day in its six-refinery system.
Marathon brand gasoline is sold through more than 5,000 independently owned
retail outlets across 18 states. In addition, Speedway LLC, an MPC subsidiary,
owns and operates the nation's fourth largest convenience store chain, with
approximately 1,460 convenience stores in seven states. MPC also owns, leases or
has ownership interests in approximately 8,300 miles of pipeline. MPC's fully
integrated system provides operational flexibility to move crude oil, feedstocks
and petroleum-related products efficiently through the company's distribution
network in the Midwest, Southeast and Gulf Coast regions. For additional
information about the company, please visit our website at
http://www.marathonpetroleum.com.
Investor Relations Contacts:
Pamela Beall (419) 429-5640
Beth Hunter (419) 421-2559
Media Contacts:
Angelia Graves (419) 421-2703
Robert Calmus (419) 421-3127
In addition to net income determined in accordance with GAAP, MPC has provided
supplemental "net income adjusted for special items," a non-GAAP financial
measure that facilitates comparisons to earnings forecasts prepared by stock
analysts and other third parties. Such forecasts generally exclude the effects
of items that are considered non-recurring, are difficult to predict or to
measure in advance or that are not directly related to MPC's ongoing operations.
A reconciliation between GAAP net income and "net income adjusted for special
items" is provided in a table on page 1 of this release. "Net income adjusted
for special items" should not be considered a substitute for net income as
reported in accordance with GAAP. We believe certain investors use "net income
adjusted for special items" to evaluate MPC's financial performance between
periods. Management also uses "net income adjusted for special items" to compare
MPC's performance to certain competitors.
This release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements relate to, among other things, MPC's current expectations, estimates
and projections concerning MPC business and operations. You can identify
forward-looking statements by words such as "anticipate," "believe," "estimate,"
"expect," "forecast," "project," "could," "may," "should," "would," "will" or
other similar expressions that convey the uncertainty of future events or
outcomes. Such forward-looking statements are not guarantees of future
performance and are subject to risks, uncertainties and other factors, some of
which are beyond the company's control and are difficult to predict. Factors
that could cause actual results to differ materially from those in the forward-
looking statements include: volatility in and/or degradation of market and
industry conditions; the availability and pricing of crude oil and other
feedstocks; slower growth in domestic and Canadian crude supply; completion of
pipeline capacity to areas outside the U.S. Midwest; consumer demand for refined
products; changes in governmental regulations; transportation logistics; the
availability of materials and labor, delays in obtaining necessary third-party
approvals, and other risks customary to construction projects; the reliability
of processing units and other equipment; our ability to successfully implement
growth opportunities; impacts from our repurchases of shares of MPC common stock
under our stock repurchase authorization, including the timing and amounts of
any common stock repurchases; the possibility the filing of the MPLX LP
registration statement may not result in the pursuit or consummation of a public
offering of units in a master limited partnership; other risk factors inherent
to our industry; and the factors set forth under the heading "Risk Factors" in
MPC's Annual Report on Form 10-K for the year ended December 31, 2011 filed with
the Securities and Exchange Commission (the "SEC"). In addition, the forward-
looking statements included herein could be affected by general domestic and
international economic and political conditions. Unpredictable or unknown
factors not discussed here or in MPC's Form 10-K could also have material
adverse effects on forward-looking statements. Copies of MPC's Form 10-K are
available on the SEC website, at http://www.ir.marathonpetroleum.com or by
contacting MPC's Investor Relations Office.
A registration statement relating to MPLX LP securities has been filed with the
SEC but has not yet become effective. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective.
This press release shall not constitute an offer to sell or the solicitation of
an offer to buy, nor shall there be any sale of securities of MPLX LP in any
state or jurisdiction in which such offer, solicitation or sale would be
unlawful prior to the registration or qualification under the securities laws of
any such state or jurisdiction.
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Consolidated Statements of Income
(Unaudited) Three Months Ended Six Months Ended
June 30 June 30
(In millions, except per-share
data) 2012 2011 2012 2011
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Revenues and other income:
Sales and other operating
revenues
(including consumer excise $20,240 $20,732 $40,504 $38,551
taxes)
Sales to related parties 3 28 4 51
Income from equity method
investments 9 17 11 26
Net gain on disposal of assets 1 4 3 5
Other income 4 13 10 32
Total revenues and other
income 20,257 20,794 40,532 38,665
Costs and expenses:
Cost of revenues (excludes items
below) 16,789 16,654 34,098 31,211
Purchases from related parties 57 981 120 1,766
Consumer excise taxes 1,428 1,269 2,808 2,478
Depreciation and amortization 236 218 466 434
Selling, general and
administrative expenses 376 288 639 505
Other taxes 64 59 138 127
Total costs and expenses 18,950 19,469 38,269 36,521
Income from operations 1,307 1,325 2,263 2,144
Related party net interest and
other financial income - 18 - 35
Net interest and other financial
income (costs) (17) (10) (39) (24)
Income before income taxes 1,290 1,333 2,224 2,155
Provision for income taxes 476 531 814 824
Net income $ 814 $ 802 $ 1,410 $ 1,331
Per-share data
Basic:
Net income $ 2.39 $ 2.25 $ 4.09 $ 3.74
Weighted average shares:((a)) 340 356 344 356
Diluted:
Net income $ 2.38 $ 2.24 $ 4.07 $ 3.72
Weighted average shares:((a)) 341 358 346 358
Dividends paid $ 0.25 $ - $ 0.50 $ -
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(a) The number of weighted average shares for the periods ended June
30, 2012, reflect the impact of the share repurchase program. For comparative
purposes, it has been assumed that the 356 million (basic) and 358 million
(diluted) shares outstanding as of the June 30, 2011, spinoff date were also
outstanding for the three and six months ended June 30, 2011.
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Supplemental Statistics
(Unaudited)
Three Months Ended Six Months Ended
June 30 June 30
(Dollars in millions) 2012 2011 2012 2011
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Income from Operations by Segment
Refining & Marketing $ 1,325 $ 1,260 $ 2,268 $ 2,062
Speedway 107 80 157 113
Pipeline Transportation 50 54 92 105
Items not allocated to
segments:
Corporate and other
unallocated items (92) (69) (171) (136)
Pension settlement expenses (83) - (83) -
Income from operations 1,307 1,325 2,263 2,144
Net interest and other financial
income (costs) (17) 8 (39) 11
Income before income taxes 1,290 1,333 2,224 2,155
Income tax provision 476 531 814 824
Net income $ 814 $ 802 $ 1,410 $ 1,331
Capital Expenditures and
Investments((a))
Refining & Marketing $ 178 $ 220 $ 331 $ 376
Speedway((b)) 187 97 198 102
Pipeline Transportation 60 24 98 38
Corporate and Other((c)) 56 44 94 73
Total $ 481 $ 385 $ 721 $ 589
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(a) Capital expenditures include changes in capital accruals.
(b) Includes Speedway's acquisitions of 87 convenience stores in May 2012 and
23 convenience stores in May 2011.
(c) Includes capitalized interest.
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Supplemental Statistics
(Unaudited) (continued)
Three Months Ended Six Months Ended
June 30 June 30
2012 2011 2012 2011
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MPC Consolidated Refined Product
Sales
Volumes (thousands of barrels
per day (mbpd))((a)) 1,591 1,578 1,574 1,570
Refining & Marketing (R&M)
Operating Statistics
Refinery throughputs (mbpd):
Crude oil refined 1,208 1,196 1,177 1,155
Other charge and blendstocks 131 176 153 192
Total 1,339 1,372 1,330 1,347
Crude oil capacity utilization
(percent)((b)) 101 105 99 101
Refined product yields (mbpd):
Gasoline 724 744 720 738
Distillates 422 429 409 419
Propane 26 26 26 25
Feedstocks and special
products 102 117 116 116
Heavy fuel oil 18 21 17 21
Asphalt 71 59 62 54
Total 1,363 1,396 1,350 1,373
R&M refined product sales volume
(mbpd)((c)) 1,571 1,561 1,551 1,551
R&M gross margin ($/barrel)((d)) $ 11.13 $ 10.78 $ 9.76 $ 8.78
Direct operating costs in R&M
gross margin ($/barrel)((e)):
Planned turnaround and major
maintenance $ 0.88 $ 0.65 $ 0.96 $ 0.94
Depreciation and amortization 1.39 1.26 1.39 1.29
Other manufacturing((f)) 3.05 2.94 3.11 3.23
Total $ 5.32 $ 4.85 $ 5.46 $ 5.46
Speedway Operating Statistics
Convenience stores at period end 1,455 1,378
Gasoline and distillates sales
(million gallons) 756 725 1,462 1,418
Gasoline and distillates gross
margin ($/gallon)((g)) $0.1639 $0.1502 $0.1377 $0.1288
Merchandise sales (millions) $ 776 $ 743 $ 1,471 $ 1,406
Merchandise gross margin
(millions) $ 203 $ 178 $ 382 $ 336
Pipeline Transportation Operating
Statistics
Pipeline throughput (mbpd)((h)):
Crude pipelines 1,193 1,221 1,157 1,197
Refined product pipelines 954 1,014 935 994
Total 2,147 2,235 2,092 2,191
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(a) Total average daily volumes of refined product sales to wholesale,
branded and retail (Speedway segment) customers.
(b) Based on calendar day capacity, which is an annual average that includes
downtime for planned maintenance and other normal operating activities.
(c) Includes intersegment sales.
(d) Sales revenue less cost of refinery inputs, purchased products and
manufacturing expenses, including depreciation and amortization, divided by R&M
segment refined product sales volume.
(e) Per barrel of total refinery throughputs.
(f) Includes utilities, labor, routine maintenance and other operating
costs.
(g) The price paid by consumers less the cost of refined products, including
transportation and consumer excise taxes, and the cost of bankcard processing
fees, divided by gasoline and distillates sales volume.
(h) On owned common-carrier pipelines, excluding equity method investments.
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Segment Earnings Before Interest, Taxes, Depreciation & Amortization (Segment
EBITDA)
(Unaudited)
Three Months Ended Six Months Ended
June 30 June 30
(Dollars in millions) 2012 2011 2012 2011
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Segment EBITDA((a))
Refining & Marketing $ 1,516 $ 1,436 $ 2,644 $ 2,417
Speedway 135 108 212 167
Pipeline Transportation 62 65 116 127
Total Segment EBITDA((a)) 1,713 1,609 2,972 2,711
Total segment depreciation &
amortization (231) (215) (455) (431)
Items not allocated to segments:
Corporate and other unallocated
items (92) (69) (171) (136)
Pension settlement expenses (83) - (83) -
Income from operations 1,307 1,325 2,263 2,144
Net interest and other financial
income (costs) (17) 8 (39) 11
Income before income taxes 1,290 1,333 2,224 2,155
Income tax provision 476 531 814 824
Net income $ 814 $ 802 $ 1,410 $ 1,331
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Select Financial Data (Unaudited)
June 30, March 31,
(Dollars in millions) 2012 2012
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( )
Cash and cash equivalents $ 1,895 $ 2,205
Total debt((a)) 3,335 3,321
Stockholders' equity 10,326 9,216
Debt-to-total-capital ratio (percent) 24 26
Cash provided from operations (quarter $ 269 $ 347
ended)
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(a) Includes long-term debt due within one year.
MPC 2Q 2012 Earnings Release:
http://hugin.info/147922/R/1630601/522652.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Marathon Petroleum Corporation via Thomson Reuters ONE
[HUG#1630601]
Unternehmensinformation / Kurzprofil:
Datum: 31.07.2012 - 13:04 Uhr
Sprache: Deutsch
News-ID 170263
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contact information:
Town:
Findlay, Ohio
Kategorie:
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