Marathon Petroleum Reports Third Quarter Results
(Thomson Reuters ONE) -
* Earnings per diluted share increased to $3.16 from $0.77 in third quarter
2010
* Refining & Marketing pre-tax segment income from operations of $1.7 billion,
up from $352 million in third quarter 2010
* Further strengthened financial position
* 25 percent increase in quarterly dividend
* Detroit Heavy Oil Upgrade Project on budget and on schedule
FINDLAY, Ohio, Nov. 1, 2011 - Marathon Petroleum Corporation (NYSE:MPC) today
reported third quarter net income of $1.13 billion, or $3.16 per diluted share,
compared with net income of $277 million, or $0.77 per diluted share, in the
third quarter of 2010.
--------------------------------------------------------------------------
Three Months Ended()
September 30
(In millions, except per diluted share data) 2011() 2010
--------------------------------------------------------------------------
( ) ()
Net income $ 1,133() $ 277
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Net income - per diluted share $ 3.16() $ 0.77
Weighted average shares - diluted 357() 358
Revenues and other income $ 20,653() $ 15,928
--------------------------------------------------------------------------
MPC President and Chief Executive Officer Gary R. Heminger said the company's
third quarter profitability can be attributed to relatively strong crack spreads
leveraged across the company's entire crude slate, as well as the company's
balance in terms of its geographic location, business integration, and crude oil
sourcing. "During the third quarter, we executed on our ability to process crude
oil produced in the U.S. mid-continent, Canada, and from virtually anywhere else
in the world," Heminger said. "We continued to capture price advantages from
processing heavy and sour crudes, which comprised approximately 50 percent of
the feedstocks we processed in the quarter. In addition, we increased our
throughput of Canadian Heavy and crude priced off of WTI, bringing these to a
combined total of approximately 38 percent of our crude slate during the
quarter, compared to 28 percent during the third quarter of 2010."
Heminger said that MPC's operational performance and flexibility also
contributed to the company's third quarter profitability. "Even as we continued
to leverage price-advantaged crudes, we also have been very successful at
operating safely and efficiently," he said. "Through the third quarter, our
crude units utilization rate was approximately 100 percent, confirming that
disciplined investment in our assets and operational excellence position us to
deliver positive financial results in a variety of market conditions."
MPC's financial performance and confidence in its business model were key
drivers behind the company's decision to increase its quarterly dividend by 25
percent. Heminger said that the increase, announced Oct. 26, reflects the
balanced approach the company intends to pursue between investing in the
business and returning capital to shareholders.
Looking to the future, Heminger noted that MPC's ability to leverage price-
advantaged heavy and sour feedstocks will be further enhanced with the
completion of the Detroit Heavy Oil Upgrade Project (DHOUP) during the second
half of 2012. "With the $2.2 billion DHOUP on budget and on schedule, we are
positioned to process an incremental 80,000 barrels per day of heavy crude once
DHOUP comes on stream," he said. Heminger added that MPC's successful project
execution extends beyond DHOUP and includes a number of other initiatives to
further enhance shareholder value. "Whether it's additional de-bottlenecking
within our refining system, expansion of our retail presence, enhancing our
logistical flexibility, or continuing to focus on overall operational
excellence, we have an ambitious agenda going forward."
Segment Results
Total segment income from operations was $1.85 billion in the third quarter of
2011, compared with $496 million in the third quarter of 2010.
--------------------------------------------------------------------------------
Three Months Ended
September 30
(In millions) 2011 2010
--------------------------------------------------------------------------------
Refining & Marketing $1,711 $ 352
Speedway 85 105
Pipeline Transportation 56 39
-------------------------------------
Segment income from operations((a)) 1,852 496
Items not allocated to segments
Corporate and other unallocated items (93) (53)
-------------------------------------
Income from operations $1,759 $ 443
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((a)) See Supplemental Statistics for a reconciliation of segment income to
net income as reported under generally accepted accounting principles.
Refining & Marketing
Refining & Marketing segment income from operations was $1.71 billion in the
third quarter of 2011, compared with $352 million in the third quarter of 2010.
The increase was primarily the result of a higher refining and marketing gross
margin, which increased to $13.18 per barrel in the third quarter of 2011 from
$3.75 per barrel in the third quarter of 2010.
The main factors contributing to the increase in the gross margin for the third
quarter of 2011 were favorable crude oil acquisition costs and higher crack
spreads. The favorable crude oil acquisition costs resulted primarily from
relatively wider differentials between West Texas Intermediate and other light
sweet crudes, such as Light Louisiana Sweet (LLS), and between sweet and sour
crudes. In addition, the Chicago and U.S. Gulf Coast (USGC) LLS 6-3-2-1 crack
spreads increased in the third quarter of 2011 compared with the third quarter
of 2010.
As of Sept. 30, the Detroit Heavy Oil Upgrade Project was 73 percent complete,
and remains on budget and on schedule for an expected completion in the second
half of 2012.
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Three Months Ended
September 30
2011 2010
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Key Refining & Marketing Statistics
--------------------------------------------------------------------------------
Refinery runs (thousand barrels per day)
Crude oil refined 1,201 1,263
Other charge & blend stocks 167 182
Total refinery inputs 1,368 1,445
Refined product sales volume (thousand 1,610 1,670
barrels per day) $0.3138 $0.0893
Refining & Marketing gross margin $13.18 $3.75
($/gallon)((a))
Refining & Marketing gross margin
($/barrel)((a))
--------------------------------------------------------------------------------
((a)) Sales revenue less cost of refinery inputs, purchased products and
manufacturing expenses, including depreciation, divided by Refining & Marketing
segment refined product sales volumes.
Speedway
Speedway's third quarter 2011 segment income from operations was $85 million,
down $20 million compared to income from operations of $105 million in the third
quarter of 2010. The decrease is primarily attributable to the sale of 166
convenience stores and 67 franchise convenience stores that were part of the
December 2010 sale of the company's Minnesota refinery and related assets.
Speedway's gasoline and distillate gross margin per gallon averaged 12.57 cents
in the third quarter of 2011, compared to 13.73 cents in the third quarter of
2010. In addition to this lower gross margin, lower sales volumes related to the
Minnesota asset disposition also impacted results. Merchandise gross margin of
$200 million was 7 percent lower in the third quarter of 2011 compared to the
third quarter of 2010, also reflecting the effects of the Minnesota asset
disposition.
Same-store gasoline sales volume at Speedway in the third quarter of 2011
decreased 2 percent, compared to an increase of 6 percent in the third quarter
of 2010. The primary factor affecting same-store gasoline sales volume in the
third quarter of 2011 was the higher average retail price of gasoline.
Speedway's same-store merchandise sales increased 2 percent in the third quarter
of 2011, compared with an increase of 3 percent for the third quarter of 2010.
--------------------------------------------------------------------------------
Three Months Ended
September 30
2011 2010
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Key Speedway Statistics
Gasoline and distillate sales (million 775 869
gallons)
Gasoline and distillate gross margin $0.1257 $0.1373
($/gallon)((a))
Merchandise sales (in millions) $797 $867
Merchandise gross margin (in millions) $200 $215
Convenience stores at period end 1,374 1,594
Same-store gasoline sales volume (period (2%) 6%
over period) 2% 3%
Same-store merchandise sales $ (period
over period)
--------------------------------------------------------------------------------
((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 distillate sales volumes.
Pipeline Transportation
Pipeline transportation segment income from operations of $56 million was $17
million higher than third quarter 2010 segment income. The increase primarily
reflects the absence of non-routine maintenance and impairment expenses incurred
in 2010, partially offset by a reduction in pipeline equity affiliate
earnings.
--------------------------------------------------------------------------------
Three Months Ended
September 30
2011 2010
--------------------------------------------------------------------------------
Key Pipeline Transportation Statistics
Pipeline barrels handled (thousand
barrels per day)((a))
Crude oil trunk lines 1,205 1,290
Refined product trunk lines 1,128 1,061
Total pipeline barrels handled 2,333 2,351
--------------------------------------------------------------------------------
((a)) Volumes transported on owned common carrier pipelines, excluding equity
method investments
Corporate Items
Corporate and other unallocated expenses increased $40 million in the third
quarter of 2011 compared with the third quarter of 2010. Approximately $33
million of the increase relates to costs associated with being a stand-alone
company, including higher information technology, employee benefits, and other
administrative and transition expenses. The remaining balance is due to higher
incentive compensation accruals related to 2011 performance.
Strengthened Financial Position and Liquidity to Fund Operations and Pursue
Strategic Priorities
At Sept. 30, the company had $2.96 billion of cash, an unused $2 billion
revolving credit facility, and an approximately $1 billion unused trade
receivables securitization facility. The company's credit facilities and cash
position should provide the company with significant flexibility to meet its
day-to-day operational needs and pursue its strategic priorities, including
value-enhancing bottom line growth opportunities and returning capital to
shareholders over time. As of Sept. 30, the company's strong financial position
was reflected in a cash-adjusted debt to capital ratio of 3 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 "2011 Third Quarter
Financial Results" link. Replays of the conference call will be available on the
company's website through Tuesday, Nov. 15. Financial information, including the
earnings release and other investor-related material, will also be available
online at http://ir.marathonpetroleum.com by clicking on "Quarterly Investor
Packet."
About Marathon Petroleum Corporation
MPC is the nation's fifth-largest refiner with a crude capacity in excess of
1.1 million barrels per day in its six-refinery system. Marathon brand gasoline
is sold through approximately 5,100 independently owned locations across 18
states. In addition, Speedway LLC, an MPC subsidiary, owns and operates the
nation's fourth largest convenience store chain, with approximately 1,375
locations in seven states. MPC also owns, operates, leases or has ownership
interest in approximately 9,600 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
Jamal Kheiry (419) 421- 3312
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," or "would" 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: 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; other risk factors inherent to our industry; and the factors set
forth under the heading "Risk Factors" in MPC's Registration Statement on Form
10 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 could also have material
adverse effects on forward-looking statements. Copies of MPC's Form 10 are
available on the SEC website, at http://www.marathonpetroleum.com or by
contacting MPC's Investor Relations Office.
--------------------------------------------------------------------------------
Consolidated Statements of Income (Unaudited)
Three Months Ended Nine Months Ended
September 30 September 30
(In millions, except per 2011 2010 2011 2010
share data)
--------------------------------------------------------------------------------
Revenues and other
income:
Sales and other
operating revenues
(including consumer
excise taxes) $20,614 $15,870 $59,165 $44,970
Sales to related
parties 2 27 53 84
Income from equity
method investments 15 18 41 56
Net gain on disposal
of assets 5 5 10 8
Other income 17 8 49 26
-------------- -------------- ------------- ------------
Total revenues
and other income 20,653 15,928 59,318 45,144
-------------- -------------- ------------- ------------
Costs and expenses:
Cost of revenues
(excludes items below) 16,896 12,903 48,107 37,323
Purchases from related
parties 80 712 1,846 1,717
Consumer excise taxes 1,329 1,351 3,807 3,871
Depreciation and
amortization 227 234 661 723
Selling, general and
administrative expenses 299 226 804 660
Other taxes 63 59 190 190
-------------- -------------- ------------- ------------
Total costs and
expenses 18,894 15,485 55,415 44,484
-------------- -------------- ------------- ------------
Income from operations 1,759 443 3,903 660
Related party net
interest and other
financial income 0 2 35 11
Net interest and other
financing income (costs) (15) (6) (39) (9)
-------------- -------------- ------------- ------------
Income before income
taxes 1,744 439 3,899 662
Provision for income
taxes 611 162 1,435 269
-------------- -------------- ------------- ------------
Net income $ 1,133 $ 277 $ 2,464 $ 393
--------------------------------------------------------------------------------
Per share data
Basic:
Net income $3.18 $0.78 $6.91 $1.10
Diluted:
Net income $3.16 $0.77 $6.88 $1.10
Dividends paid $0.20 - $0.20 -
--------------------------------------------------------------------------------
Weighted average
shares:((a))
Basic 356 356 356 356
Diluted 357 358 358 358
--------------------------------------------------------------------------------
((a) ) For comparative purposes, it has been assumed that the 356 million
(basic) and 358 million (diluted) shares outstanding as of the June 30, 2011
spin-off date were also outstanding for each of the periods presented prior to
the spin-off date.
--------------------------------------------------------------------------------
Supplemental Statistics (Unaudited)
( )
Three Months Ended() Nine Months Ended
September 30 September 30
(Dollars in 2011() 2010 2011 2010
millions)
--------------------------------------------------------------------------------
( ) ( )
Segment Income from
Operations ( )
Refining & Marketing $ 1,711() $ 352 $ 3,773 $ 497
Speedway 85() 105 198 228
Pipeline 56() 39 161 131
Transportation
-------------- -------------- --------------- ------------
Segment income 1,852() 496 4,132 856
from operations
Items not allocated ( )
to segments
Corporate and
other unallocated (93) (53) (229) (167)
items
Impairments - - - (29)
Net interest and
other financial (15) (4) (4) 2
income (costs)
-------------- -------------- --------------- ------------
Income before income 1,744() 439 3,899 662
taxes
Income tax provision 611 162 1,435 269
-------------- -------------- --------------- ------------
Net income $ 1,133 $ 277 $ 2,464 $ 393
-------------- -------------- --------------- ------------
( ) ()
Capital Expenditures ( )
and Investments((a))
Refining & $ 224() $ 228 $ 600 $ 713
Marketing
Speedway( (b)) 19() 15 121 33
Pipeline 31() 6 69 15
Transportation
Other ((c)) 26 75
31 104
-------------- -------------- --------------- ------------
Total $ 305 $ 275 $ 894 $ 836
( )
--------------------------------------------------------------------------------
((a) ) Capital expenditures include changes in accruals.
((b)) Includes $74 million acquisition of 23 convenience stores in May 2011.
((c)) Includes capitalized interest.
( )
--------------------------------------------------------------------------------
Supplemental Statistics (Unaudited) (continued)
()
Three Months Nine Months
Ended() Ended
September 30 September 30
(Dollars in millions, except as noted) 2011 () 2010 2011 2010
--------------------------------------------------------------------------------
( ) ()
MPC Consolidated Refined Product Sales
Volumes (thousand barrels per 1,625() 1,681 1,589 1,550
day)((a))
Refining & Marketing Operating
Statistics
Refinery runs (thousand barrels per day)
Crude oil refined 1,201() 1,263 1,171 1,166
Other charge and blend stocks 167() 182 183 148
----------- --------- --------- --------
Total 1,368() 1,445 1,354 1,314
Refined product yields (thousand barrels
per day) ( )
Gasoline 724() 785 733 706
Distillates 433() 439 424 392
Propane 25() 27 25 24
Feedstocks and special products 122() 113 118 108
Heavy fuel oil 19() 28 20 24
Asphalt 63() 80 57 79
----------- --------- --------- --------
Total 1,386() 1,472 1,377 1,333
Refined products sales volumes (thousand
barrels per day)((b)) 1,610() 1,670 1,571 1,538
Refining and marketing gross margin $0.3138() $0.0893 $0.2452 $0.0598
($/gallon)((c))
Speedway Operating Statistics ( )
Convenience stores at period end 1,374() 1,594
Gasoline and distillate sales (million
gallons) 775() 869 2,193 2,500
Gasoline and distillate gross margin $0.1257() $0.1373 $0.1277 $0.1193
($/gallon)((d))
Merchandise sales $ 797() $ 867 $ 2,203 $ 2,430
Merchandise gross margin $ 200() $ 215 $ 536 $ 600
Pipeline Transportation Operating
Statistics
Pipeline barrels handled (thousand
barrels per day)((e))
Crude oil trunk lines 1,205 1,290 1,200 1,210
Refined product trunk lines 1,128 1,061 1,039 913
----------- --------- --------- --------
Total pipeline barrels handled 2,333 2,351 2,239 2,123
--------------------------------------------------------------------------------
((a)) Total average daily volumes of refined product sales to wholesale,
branded and retail (Speedway segment) customers.
((b)) Includes intersegment sales.
((c)) Sales revenue less cost of refinery inputs, purchased products and
manufacturing expenses, including depreciation, divided by Refining & Marketing
segment refined product sales volumes.
((d)) 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 distillate sales volumes.
((e)) On owned common carrier pipelines, excluding equity method investments.
--------------------------------------------------------------------------------
Earnings Before Interest, Taxes, Depreciation & Amortization (EBITDA) by Segment
()
Three Months Ended() Nine Months Ended
September 30 September 30
(Dollars in millions) 2011 () 2010 2011 2010
--------------------------------------------------------------------------------
( ) ()
EBITDA((a)) ()
Refining & Marketing $ 1,890 $ 532 $ 4,307 $ 1,058
Speedway 113 131 280 311
Pipeline 68 67 195 181
Transportation
---------------- ------------- ------------- -----------
Total segment 2,071
EBITDA 730 4,782 1,550
Less: Total segment 234 650 694
depreciation & 219
amortization
---------------- ------------- ------------- -----------
Total segment 1,852
income from operations 496 4,132 856
( )
Items not allocated to
segments
Corporate and
other unallocated (93) (53) (229) (167)
items
Impairments - - - (29)
Net interest and
other financial income (15) (4) (4) 2
(costs)
---------------- ------------- ------------- -----------
Income before income 1,744
taxes 439 3,899 662
Income tax provision 611 162 1,435 269
---------------- ------------- ------------- -----------
Net income $ 1,133 $ 277 $ 2,464 $ 393
---------------- ------------- ------------- -----------
--------------------------------------------------------------------------------
((a)) EBITDA represents earnings before interest and financing costs,
interest income, income taxes and depreciation and amortization expense. We
present EBITDA on a segment basis because we believe some investors and analysts
use EBITDA to help analyze operating performance and cash flows, including our
ability to satisfy principal and interest obligations with respect to our
indebtedness and to use cash for other purposes, including capital expenditures.
EBITDA is also used by some investors and analysts to analyze and compare
companies on the basis of operating performance and by management for internal
analysis and as a component of financial covenants in our credit agreements.
EBITDA should not be considered as an alternative to net income, income before
income taxes, cash flows from operating activities or any other measure of
financial performance presented in accordance with accounting principles
generally accepted in the United States. EBITDA may not be comparable to
similarly titled measures used by other entities.
------------------------------------------------------------------------
Select Balance Sheet Data (Unaudited)
September 30, June 30,
(Dollars in millions) 2011 2011
------------------------------------------------------------------------
Cash and cash equivalents $ 2,957 $ 1,622
Total debt((a)) $ 3,299 $ 3,274
Cash-adjusted total debt((b)) $ 342 $ 1,652
Stockholders' equity $10,049 $ 8,977
Cash-adjusted debt to capital ratio 3% 16%
------------------------------------------------------------------------
((a)) Includes long-term debt due within one year.
((b)) We present cash-adjusted total debt because we believe some investors
and analysts use this information to help analyze a company's financial
position.
MPC Third Quarter 2011 Results:
http://hugin.info/147922/R/1559792/482423.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 Company via Thomson Reuters ONE
[HUG#1559792]
Unternehmensinformation / Kurzprofil:
Datum: 01.11.2011 - 12:06 Uhr
Sprache: Deutsch
News-ID 82557
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contact information:
Town:
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Kategorie:
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