-
Reported earnings of $551 million, or $3.49 per
diluted share; results included the following pre-tax items: $209
million related to a LCM inventory benefit, a $19 million
environmental accrual and acquisition and integration costs of $45
million
-
Returned $345 million to shareholders including
$252 million in share repurchases; expect to repurchase $300
million of shares in the fourth quarter 2017
-
Total retail and branded stations up 27%
year-over-year to 3,124 stores
-
On October 30, 2017, Andeavor Logistics closed
its $1.7 billion acquisition of Western Refining Logistics
-
On October 30, 2017, Andeavor and Andeavor
Logistics completed the IDR Buy-In transaction for 78.0 million
ANDX units valued at $3.6 billion
-
On October 31, 2017, Andeavor Logistics upgraded
to BBB- by S&P
-
On November 8, 2017, announced drop down of
Anacortes Logistics Assets for $445 million
SAN ANTONIO,
TEXAS - November 8, 2017 - Andeavor (NYSE: ANDV) today reported
third quarter earnings of $551 million, or $3.49 per diluted share,
compared to $170 million, or $1.43 per diluted share a year ago.
Consolidated net earnings were $601 million for the third quarter
2017 compared to $201 million for the same period last year. EBITDA
for the third quarter 2017 was $1.2 billion compared to $577
million last year.
Third quarter 2017 results
included the following pre-tax items: $209 million benefit related
to a lower of cost or market (LCM) inventory adjustment, a $19
million environmental accrual, acquisition and integration costs of
$32 million related to the Western Refining (Western) acquisition
and acquisition costs of $13 million related to Andeavor Logistics
LP's (NYSE: ANDX) acquisition of Western Refining Logistics, LP
(WNRL) and the IDR Buy-In transaction. In addition, a planned
turnaround of the fluid catalytic cracker unit (FCCU) at the
Martinez, California refinery was extended into early September.
The extension and other unplanned maintenance associated with the
restart negatively impacted operating income by an estimated $42
million. The maintenance was completed by the end of the third
quarter 2017. Third quarter 2016 results included a pre-tax benefit
of $20 million related to a LCM inventory adjustment.
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
(Unaudited) ($ in millions, except per share
data) |
2017 |
|
2016 |
|
2017 |
|
2016 |
Operating Income |
|
|
|
|
|
|
|
Marketing |
$ |
175 |
|
|
$ |
273 |
|
|
$ |
544 |
|
|
$ |
661 |
|
Logistics |
164 |
|
|
127 |
|
|
481 |
|
|
364 |
|
Refining |
762 |
|
|
58 |
|
|
841 |
|
|
492 |
|
Total Segment Operating Income |
$ |
1,101 |
|
|
$ |
458 |
|
|
$ |
1,866 |
|
|
$ |
1,517 |
|
Net
Earnings From Continuing Operations Attributable to Andeavor
(a) |
$ |
551 |
|
|
$ |
170 |
|
|
$ |
641 |
|
|
$ |
646 |
|
|
|
|
|
|
|
|
|
Diluted EPS - Continuing Operations |
$ |
3.49 |
|
|
$ |
1.43 |
|
|
$ |
4.71 |
|
|
$ |
5.37 |
|
Diluted EPS - Discontinued Operations |
0.05 |
|
|
(0.01 |
) |
|
0.06 |
|
|
0.08 |
|
Total Diluted EPS |
$ |
3.54 |
|
|
$ |
1.42 |
|
|
$ |
4.77 |
|
|
$ |
5.45 |
|
(a) Referred to in the
body of this press release as "earnings."
"Our business delivered strong
results across our integrated value chain for the quarter. Our
marketing business is well positioned for continued growth
following the Western Refining and Northern California Retail
acquisitions which bring more secure and profitable earnings to the
portfolio. Andeavor Logistics completed the acquisition of WNRL and
the IDR buy-in transaction, which positions us to capture
significant organic growth in the Permian Basin," said Greg Goff,
Chairman and CEO.
"Our strong cash generation and
financial discipline allow us to continue to invest in the business
for growth and return cash to shareholders. In addition to the $400
million of share repurchases through the third quarter, we expect
to repurchase $300 million of shares in the fourth quarter," added
Goff.
SEGMENT RESULTS
MARKETING. Marketing segment operating income
was $175 million and segment EBITDA was $193 million in the third
quarter 2017. This compares to segment operating income of $273
million and segment EBITDA of $285 million last year.
Overall fuel margins were 10.0
cents per gallon in the third quarter 2017, compared to 14.9 cents
per gallon last year. Retail and Branded fuel margins were 19.3
cents per gallon compared to 25.3 cents per gallon in 2016. With a
significant increase in product spot prices during the first half
of the quarter, Andeavor's integrated business reflected the value
of this rise in the Refining segment's results for the quarter. The
Company still expects Marketing segment fuel margins to average 11
to 14 cents per gallon over time.
Merchandise margin increased to
$54 million from $3 million in 2016 driven by the Western
acquisition. Andeavor continued to grow its network of branded
stores, increasing by 657 stores, or 27%, to 3,124. This was
primarily driven by the additional stores from the Western and
Northern California Retail acquisitions and the continued execution
of the Company's organic growth plan.
LOGISTICS.
Logistics segment operating income increased to $164 million in the
third quarter 2017 from $127 million a year ago and segment EBITDA
increased to $252 million from $177 million last year. Results
included a $19 million environmental accrual related to the
expected final remediation costs for the 2013 crude oil pipeline
release at Tioga, North Dakota and $9 million of acquisition costs
related to Andeavor Logistics' acquisition of WNRL and the IDR
Buy-In transaction. The increase in segment operating income and
segment EBITDA was primarily driven by strong California refinery
utilization and summer demand for refined products, contributions
from the North Dakota Gathering and Processing Assets acquisition
completed in early 2017, contributions from the drop downs
completed in 2016, and as a result of the Company's Permian and
Northern Great Plains logistics and wholesale operations added as
part of the Western acquisition.
REFINING.
Refining segment operating income was $762 million for the third
quarter 2017 compared to segment operating income of $58 million in
2016. Segment EBITDA was $940 million compared to $208 million in
2016. Segment operating income and segment EBITDA included a
pre-tax benefit related to a LCM inventory adjustment of $209
million and $20 million in the third quarter 2017 and the third
quarter 2016, respectively. The strong performance was driven by
high crude oil and feedstock throughput and reliable operations,
however we did experience additional costs and extended downtime
during the planned FCCU turnaround at the Martinez refinery.
Refining margin was $1.6 billion,
or $15.09 per barrel for the third quarter 2017. This compares to a
refining margin of $729 million, or $9.08 per barrel in the third
quarter 2016. Other than the LCM impact and the Martinez
turnaround, the year-over-year increase in refining margin reflects
the continued delivery of improvements to operating income,
contributions from the Western acquisition and a stronger refining
crack spread environment.
CORPORATE AND
OTHER
Corporate and unallocated costs for the third quarter 2017 were
$158 million and included $36 million of costs related to the
integration of Western and costs incurred by Andeavor in connection
with Andeavor Logistics' acquisition of WNRL and the IDR Buy-In
transaction. Net interest was $97 million in the third quarter
2017. The effective tax rate for the third quarter 2017 was
31.6%.
BALANCE SHEET AND
CASH FLOW
Andeavor ended the third quarter with $528 million in cash and cash
equivalents. This was down from $3.3 billion at the end of 2016
primarily due to the closing of the Western acquisition, timing of
working capital impacts and Andeavor Logistics' acquisition of the
North Dakota Gathering and Processing Assets. Andeavor has
approximately $2.0 billion of availability under its revolving
credit facility. Total debt, net of unamortized issuance costs, was
$7.7 billion at the end of the third quarter. Excluding Andeavor
Logistics and WNRL debt, total debt was $3.6 billion.
Capital spending for the third
quarter 2017 was $339 million for Andeavor, $51 million for
Andeavor Logistics and $8 million related to WNRL. Turnaround
expenditures for the third quarter were $98 million. The Company
expects 2017 capital expenditures of approximately $1.3 billion,
consisting of approximately $1.05 billion at Andeavor and $245
million at Andeavor Logistics. Turnaround expenditures for the full
year 2017 are expected to be $540 million. The revised capital
expenditure estimate reflects changes in the Company's funding
strategy for the Los Angeles Pipeline Interconnect System and the
Conan Crude Oil Gathering Pipeline System (the Conan System).
Andeavor anticipates transferring the Los Angeles Pipeline
Interconnect System and the Conan System to Andeavor Logistics at
cost when the projects are complete versus Andeavor Logistics
making progress payments as capital expenditures during project
construction.
Andeavor repurchased 2.6 million
shares for approximately $252 million in the third quarter and has
$1.7 billion remaining under its previously approved share
repurchase programs. The Company paid cash dividends of $93 million
in the third quarter 2017. Additionally, Andeavor today announced
that the board of directors has declared a quarterly cash dividend
of $0.59 per share payable on December 15, 2017 to all holders
of record as of November 30, 2017. Andeavor is committed to
maintaining a strong, investment grade balance sheet and has
flexibility and discipline to continue to invest in high-return
capital projects, pursue strategic acquisitions and return cash to
shareholders through share repurchases and dividends.
STRATEGIC
UPDATE
WESTERN SYNERGY UPDATE. Andeavor is committed
to delivering an expected $350 to $425 million in annual run-rate
synergies by June 2019, the second year following the close of the
transaction. This includes approximately $120 to $160 million from
value chain optimization, $130 to $140 million from operational
improvements and $100 to $125 million from corporate efficiencies.
Andeavor estimates it has achieved approximately $110 million in
annual run-rate synergies though third quarter 2017, consisting
primarily of approximately $85 million of corporate efficiencies
and the remainder in value chain optimization and operational
improvements.
MLP MERGER AND
IDR BUY-IN. On October 30, 2017, Andeavor Logistics completed
its $1.7 billion acquisition of Western Refining Logistics.
Immediately following the closing of the WNRL acquisition, Andeavor
and Andeavor Logistics completed its IDR Buy-In transaction whereby
Andeavor Logistics issued 78.0 million ANDX common units to
Andeavor in exchange for the cancellation of Andeavor Logistics'
IDRs and the conversion of its economic general partner interest
into a non-economic general partner interest. The total value of
the IDR Buy-In represents a $3.6 billion in value based on Andeavor
Logistics' closing unit price of $45.90 on October 30, 2017.
Andeavor Logistics remains committed to achieving its target $625
to $725 million of annual net earnings and $1.2 to $1.3 billion of
annual EBITDA for 2018, annual distribution growth of 6% or
greater, distribution coverage ratio of approximately 1.1 times and
debt-to-EBITDA at or below 4.0 times.
Over the next few years, Andeavor
Logistics continues to expect to invest approximately $1 billion
annually in organic growth projects, acquisitions and drop downs
from Andeavor. Following the WNRL acquisition, the IDR Buy-In and
achieving an investment grade credit rating, Andeavor Logistics is
well positioned to capture growth with a much lower cost of
capital. Following these transactions, Andeavor owns approximately
59% of Andeavor Logistics common units.
INVESTMENT GRADE
CREDIT RATING AT ANDEAVOR LOGISTICS ACHIEVED. On October 31,
2017, S&P Global Ratings raised Andeavor Logistics' corporate
credit and senior unsecured issue ratings to "BBB-" with a stable
outlook from "BB+". In February 2017, Fitch Ratings assigned a
first-time Long-Term Issuer Default Rating of BBB- to Andeavor
Logistics, marking the Company's inaugural investment grade credit
rating. As a result of Andeavor Logistics achieving a "BBB-" credit
rating at both S&P and Fitch, Andeavor Logistics' outstanding
unsecured bond securities now meet the criteria to be included in
the investment grade Bloomberg Barclays Global Aggregate and ICE
BofAML Global Bond Indices. Andeavor Logistics is well positioned
to enhance its existing capital structure and meet future financing
needs at attractive rates with longer maturities in a more liquid
market. Additionally, on October 26, 2017, Moody's Investors
Service upgraded Andeavor Logistics' Corporate Family Rating
to "Ba1" with a positive outlook from "Ba2".
DROP DOWN OF
ANACORTES LOGISTICS ASSETS. Andeavor today announced Andeavor
Logistics agreed to acquire logistics assets located in Anacortes,
Washington from Andeavor for total consideration of $445 million.
The Anacortes Logistics Assets are expected to provide annual net
earnings of $30 to $35 million and annual EBITDA of $50 to $55
million. This represents a multiple of approximately 8.5 times
annual EBITDA. In connection with the acquisition, Andeavor and
Andeavor Logistics entered into long-term, fee-based agreements
which are expected to provide stable cash flows to Andeavor
Logistics. Andeavor Logistics paid $445 million, including $400
million of cash financed with borrowings on Andeavor Logistics
revolving credit facilities and issuance of approximately $45
million in common units to Andeavor for the drop down. The equity
consideration was based on the average daily closing price of
Andeavor Logistics common units for the 10 trading days prior to
closing, or $45.37 per unit in the form of 980,802 common
units.
CONAN CRUDE OIL
GATHERING PIPELINE SYSTEM. During the quarter, Andeavor
announced that it received sufficient commitments from third party
shippers to warrant construction of the Conan Crude Oil Gathering
Pipeline system in the Delaware Basin. The Conan system will be
approximately 130 miles in length and transport crude oil from
origins in Lea County, New Mexico and Loving County, Texas to a
terminal to be constructed in Loving County, Texas, where the
gathering system interconnects with long-haul pipeline carriers.
The first phase of the Conan system will provide capacity of
approximately 250,000 barrels per day. Future phases of the system
may expand capacity up to 500,000 barrels per day.
The system is under construction
and is expected to begin commercial service in mid-2018. The
estimated capital investment for the first phase of the gathering
system is approximately $225 million of which $75 million is
expected to be spent in 2017. This project is expected to be
transferred to Andeavor Logistics at cost upon completion in
2018.
IMPROVEMENTS TO
OPERATING INCOME. Andeavor continues to expect an Andeavor
Index of $12 to $14 per barrel and Marketing segment fuel margins
of 11 to 14 cents per gallon for 2017. The Company remains
committed to delivering an estimated $475 to $575 million of
improvements to operating income in 2017, which is comprised of
$395 to $475 million from growth and productivity and $80 to $100
million from higher throughput and other operational improvements.
These improvements consist of $45 to $70 million in Marketing, $125
to $150 million in Logistics and $305 to $355 million in Refining.
All of these improvements exclude any expected synergies from the
Western acquisition. Through third quarter 2017, the Company has
delivered approximately 75% to 85% of the improvements.
PUBLIC INVITED TO
LISTEN TO ANALYST AND INVESTOR CONFERENCE CALL
At 7:30 a.m. CT tomorrow morning, Andeavor will live broadcast its
conference call with analysts regarding third quarter 2017 results
and other business matters. Interested parties may listen to the
conference call by logging on to http://www.andeavor.com.
2017 INVESTOR AND
ANALYST DAY
Andeavor and Andeavor Logistics will host their 2017 Investor and
Analyst Day at The St. Regis Hotel in New York City on December 5,
2017 at 9:00 a.m. ET. Because space is limited, reservations are
required to attend and will be accepted on a first-come,
first-serve basis. Interested parties can request an invitation by
contacting the Investor Relations department via email
at irelations@andeavor.com. The presentation will also be
webcast live at http://www.andeavor.com and
http://www.andeavorlogistics.com.
ABOUT
ANDEAVOR
Andeavor is a premier, highly integrated marketing, logistics and
refining company. Andeavor's retail-marketing system includes more
than 3,100 stores marketed under multiple well-known fuel brands,
including ARCO®, SUPERAMERICA®, Shell®, Exxon®, Mobil®, Tesoro®,
USA Gasoline(TM) and Giant®. It also has ownership in Andeavor
Logistics LP (NYSE: ANDX) and its non-economic general partner.
Andeavor operates 10 refineries with a combined capacity of
approximately 1.2 million barrels per day in the mid-continent and
western United States.
This earnings
release contains "forward-looking" statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, including without limitation
statements concerning: our operational, financial and growth
strategies, including continued growth, maintaining a strong,
investment grade balance sheet, investing in high-return capital
projects, pursuing strategic acquisitions, returning cash to our
shareholders, and driving growth and improvements; our ability to
successfully effect those strategies and the expected timing and
results thereof; our financial and operational outlook, and ability
to fulfill that outlook; our financial position, liquidity and
capital resources; expectations regarding future stock repurchases;
expectations regarding future economic and market conditions and
their effects on us; delivery of synergies, including expected
annual run-rate synergies from the Western acquisition and the
sources thereof; the amount and timing of future dividends;
statements regarding Andeavor Logistics' acquisition of WNRL and
the IDR Buy-in, and the expected benefits thereof, including
projected annual net earnings and EBITDA; marketing acquisition
projected annual net earnings and EBITDA; Andeavor Logistics'
annual distribution growth, distribution coverage ratio and
debt-to-EBITDA targets; Andeavor Logistics' expected annual
investment in growth projects; the expected benefits to Andeavor
Logistics of being investment grade; statements regarding the
announced drop down of Anacortes logistics assets to Andeavor
Logistics, including the expected benefits and timing thereof, and
the expected annual net earnings and annual EBITDA provided
thereby; statements regarding the Conan Crude Oil Gathering
Pipeline system, including expected capacity, timing and capital
investment; the planned transfer of the Conan System and the Los
Angeles Pipeline Interconnect System to Andeavor Logistics; and our
2017 outlook, including expectations relating to the Andeavor
Index, marketing segment fuel margins, annual improvements to
operating income and the drivers thereof, including expectations
with respect to each segment, 2017 total capital expenditures and
the allocation thereof, including turnaround expenditures, and
fourth quarter 2017 guidance. For more information concerning
factors that could affect these statements, see our annual report
on Form 10-K, quarterly reports on Form 10-Q, and other public
filings and press releases, available at www.andeavor.com. We
undertake no obligation to revise or update any forward-looking
statements as a result of new information, future events or
otherwise.
Contact:
Investors:
Brian Randecker, Investor Relations, (210) 626-4757
Media:
Andeavor Media Relations, media@andeavor.com, (210) 626-7702
(b) As a performance
benchmark, we utilize crack spreads and the Andeavor Index to
measure the difference between market prices for crude oil and
refined products. Crack spreads are a commonly used proxy within
the industry to estimate or identify trends in refining margins,
while the Andeavor Index is more specifically designed around
Andeavor's assets. Crack spreads and the Andeavor Index can
fluctuate significantly over time as a result of market conditions
and supply and demand balances. For example, The West Coast 321
crack spread is calculated using three barrels of Alaska North
Slope crude oil (ANS) producing two barrels of Los Angeles CARB
gasoline and one barrel of Los Angeles CARB diesel. In comparison
the Andeavor Index uses several crude oils and products to provide
a potentially closer representation of the available margin. Our
actual refining margins differ from these crack spreads and the
Andeavor Index based on the actual slate of crude oil we run at our
refineries and the products we produce or yield.
ANDEAVOR
FOURTH QUARTER 2017 GUIDANCE (Unaudited)
Throughput (Mbpd) |
|
California |
520 - 545 |
Pacific Northwest |
165 - 175 |
Mid-Continent |
385 - 405 |
Consolidated |
1,070 - 1,125 |
|
|
Manufacturing Cost ($/throughput barrel) |
|
California |
$ 5.90 - 6.15 |
Pacific Northwest |
$ 4.60 - 4.85 |
Mid-Continent |
$ 4.35 - 4.60 |
Consolidated |
$ 5.15 - 5.40 |
|
|
Corporate/System ($ millions) |
|
Refining depreciation and amortization |
$ 175 - 180 |
Logistics depreciation and amortization |
$ 80 - 85 |
Marketing depreciation and amortization |
$ 15 - 20 |
Corporate and other depreciation and amortization |
$ 5 - 10 |
Corporate expense (before depreciation and integration costs) |
$ 155 - 165 |
Interest expense (before interest income) |
$ 100 - 105 |
Noncontrolling Interest |
$ 55 - 65 |
NON-GAAP
MEASURES
Our management uses certain
"non-GAAP" performance measures to analyze operating segment
performance and "non-GAAP" financial measures to evaluate past
performance and prospects for the future to supplement our GAAP
financial information presented in accordance with accounting
principles generally accepted in the United States of America
("U.S. GAAP"). These financial and operational non-GAAP measures
are important factors in assessing our operating results and
profitability and include:
· EBITDA-U.S.
GAAP-based net earnings before interest, income taxes, and
depreciation and amortization expenses;
· Fuel margin-the
difference between total marketing revenues and marketing cost of
fuels and other;
· Fuel margin per
gallon-fuel margin divided by our total fuel sales volumes in
gallons;
· Merchandise
margin-the difference between merchandise sales and purchases of
merchandise;
· Merchandise
margin percentage-merchandise margin divided by merchandise
sales;
-
Average margin on NGL sales per barrel-the
difference between the NGL sales revenues and the amounts
recognized as NGL expenses divided by our NGL sales volumes in
barrels presented in Mbpd multiplied by 1,000 and multiplied by the
number of days in the period, (92 days for both the three months
ended September 30, 2017 and 2016, 273 days for the nine months
ended September 30, 2017 and 274 days for the nine months ended
September 30, 2016);
-
Average wholesale fuel sales margin per
gallon-the difference between total wholesale fuel revenues and
wholesale's cost of fuel divided by our total wholesale fuel sales
volumes in gallons;
-
Refining margin-the difference between total
refining revenues minus total cost of materials and other;
-
Refining margin per throughput barrel-refining
margin divided by our total refining throughput in barrels
multiplied by 1,000 and multiplied by the number of days in the
period as stated above;
-
Manufacturing costs (excluding depreciation and
amortization) per throughput barrel-manufacturing costs divided by
our total refining throughput in barrels multiplied by 1,000 and
multiplied by the number of days in the period as stated above
(representing direct operating expenses incurred by our Refining
segment for the production of refined products); and
-
Total debt excluding Andeavor Logistics and
WNRL-our consolidated Andeavor debt less all debt owed by Andeavor
Logistics and WNRL (both net of unamortized debt issuance
costs).
We present these measures because
we believe they may help investors, analysts, lenders and ratings
agencies analyze our results of operations and liquidity in
conjunction with our U.S. GAAP results, including but not limited
to:
-
our operating performance as compared to other
publicly traded companies in the refining, logistics and marketing
industries, without regard to historical cost basis or financing
methods;
-
our ability to incur and service debt and fund
capital expenditures; and
-
the viability of acquisitions and other capital
expenditure projects and the returns on investment of various
investment opportunities.
Management also uses these
measures to assess internal performance. Non-GAAP measures have
important limitations as analytical tools, because they exclude
some, but not all, items that affect net earnings and operating
income. These measures should not be considered substitutes for
their most directly comparable U.S. GAAP financial measures. See
"Non-GAAP Reconciliations" below for reconciliations between
non-GAAP measures and their most directly comparable U.S. GAAP
measures.
ITEMS IMPACTING
COMPARABILITY
On June 1, 2017, we closed
the Western acquisition. Our results include the operations from
Western for the period of June 1, 2017 to September 30, 2017 and
thus prior periods may not be comparable. With the Western
acquisition, we have updated our segments to reflect the results
and operations of Western and WNRL. Our Marketing segment reflects
our expanded marketing business that, combined with Western, now
consists of expanded wholesale marketing operations and
approximately 3,100 retail stores marketed under multiple
well-known fuel brands including ARCO®, SUPERAMERICA®, Shell®,
Exxon®, Mobil®, Conoco®, Tesoro®, USA GasolineTM and
Giant®. Our renamed Logistics segment includes the combined results
of Andeavor Logistics and WNRL. We now report the Logistics
segment's results for the combined Gathering and Processing,
Terminalling and Transportation and Wholesale business lines. Our
Refining segment reports the results of our refining system that
now consists of ten refineries in the mid-continent and western
United States with a combined capacity of approximately 1.2 million
barrels per day. The Refining segment includes the results from
Andeavor's existing Refining segment and Western's Refining
segment, excluding third-party wholesale marketing operations that
are now reported in our Marketing segment.
The Logistics segment's financial
and operational data presented include the historical results of
all assets acquired from Andeavor prior to the acquisition dates.
The acquisitions from Andeavor were transfers between entities
under common control. Accordingly, the financial information
contained herein has been retrospectively adjusted to include the
historical results of the assets acquired from Andeavor prior to
the effective date of each acquisition for all periods presented
and do not include revenue for transactions with Andeavor. The
Logistics segment's financial data is derived from the combined
financial results of the Logistics segment's predecessor (the
"Predecessor"). We refer to the Predecessor and, prior to each
acquisition date, the acquisitions from Andeavor collectively, as
"Predecessors."
ANDEAVOR
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(In millions)
|
September 30, 2017 |
|
December 31, 2016 |
ASSETS |
|
|
|
Current Assets |
|
|
|
Cash
and cash equivalents (Logistics: $38 and $688, respectively) |
$ |
528 |
|
|
$ |
3,295 |
|
Receivables, net of allowance for doubtful accounts |
1,649 |
|
|
1,108 |
|
Inventories |
3,791 |
|
|
2,640 |
|
Prepayments and other current assets |
577 |
|
|
371 |
|
Total
Current Assets |
6,545 |
|
|
7,414 |
|
Property, Plant and Equipment, Net (Logistics:
$4,422 and $3,444, respectively) |
14,410 |
|
|
9,976 |
|
Other Noncurrent Assets, Net (Logistics:
$1,560 and $1,478, respectively) |
6,931 |
|
|
3,008 |
|
Total Assets |
$ |
27,886 |
|
|
$ |
20,398 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current Liabilities |
|
|
|
Accounts payable |
$ |
2,830 |
|
|
$ |
2,032 |
|
Current maturities of debt |
28 |
|
|
465 |
|
Other
current liabilities |
1,593 |
|
|
1,057 |
|
Total Current Liabilities |
4,451 |
|
|
3,554 |
|
Deferred Income Taxes |
2,200 |
|
|
1,428 |
|
Debt,
Net of Unamortized Issuance Costs (Logistics:
$4,079 and $4,053, respectively) |
7,633 |
|
|
6,468 |
|
Other
Noncurrent Liabilities |
992 |
|
|
821 |
|
Total
Equity |
12,610 |
|
|
8,127 |
|
Total Liabilities and Equity |
$ |
27,886 |
|
|
$ |
20,398 |
|
ANDEAVOR
RESULTS OF CONSOLIDATED OPERATIONS (Unaudited) (In
millions, except per share amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Revenues |
$ |
9,836 |
|
|
$ |
6,544 |
|
|
$ |
24,323 |
|
|
$ |
17,930 |
|
Costs and Expenses: |
|
|
|
|
|
|
|
Cost
of materials and other (excluding items shown separately
below) |
7,750 |
|
|
5,236 |
|
|
19,393 |
|
|
14,125 |
|
Lower of
cost or market inventory valuation adjustment |
(209 |
) |
|
(20 |
) |
|
- |
|
|
(236 |
) |
Operating expenses (excluding depreciation and amortization) |
899 |
|
|
648 |
|
|
2,292 |
|
|
1,861 |
|
Depreciation and amortization expenses |
273 |
|
|
211 |
|
|
739 |
|
|
633 |
|
General and administrative expenses |
168 |
|
|
107 |
|
|
552 |
|
|
283 |
|
(Gain) loss on asset disposals and impairments |
1 |
|
|
2 |
|
|
(20 |
) |
|
7 |
|
Operating Income |
954 |
|
|
360 |
|
|
1,367 |
|
|
1,257 |
|
Interest and financing costs, net |
(97 |
) |
|
(70 |
) |
|
(273 |
) |
|
(190 |
) |
Equity
in earnings of equity method investments |
11 |
|
|
7 |
|
|
14 |
|
|
12 |
|
Other income (expense), net |
(1 |
) |
|
- |
|
|
10 |
|
|
32 |
|
Earnings Before Income Taxes |
867 |
|
|
297 |
|
|
1,118 |
|
|
1,111 |
|
Income tax expense |
274 |
|
|
95 |
|
|
351 |
|
|
362 |
|
Net Earnings From Continuing Operations |
593 |
|
|
202 |
|
|
767 |
|
|
749 |
|
Earnings (loss) from discontinued operations, net of
tax |
8 |
|
|
(1 |
) |
|
8 |
|
|
10 |
|
Net Earnings |
601 |
|
|
201 |
|
|
775 |
|
|
759 |
|
Less: Net earnings from continuing operations attributable
to noncontrolling interest |
42 |
|
|
32 |
|
|
126 |
|
|
103 |
|
Net Earnings Attributable to
Andeavor |
$ |
559 |
|
|
$ |
169 |
|
|
$ |
649 |
|
|
$ |
656 |
|
|
|
|
|
|
|
|
|
Net Earnings (Loss) Attributable to
Andeavor |
|
|
|
|
|
|
|
Continuing operations |
$ |
551 |
|
|
$ |
170 |
|
|
$ |
641 |
|
|
$ |
646 |
|
Discontinued operations |
8 |
|
|
(1 |
) |
|
8 |
|
|
10 |
|
Total |
$ |
559 |
|
|
$ |
169 |
|
|
$ |
649 |
|
|
$ |
656 |
|
|
|
|
|
|
|
|
|
Net Earnings (Loss) per Share - Basic |
|
|
|
|
|
|
|
Continuing operations |
$ |
3.52 |
|
|
$ |
1.44 |
|
|
$ |
4.75 |
|
|
$ |
5.43 |
|
Discontinued operations |
0.05 |
|
|
(0.01 |
) |
|
0.06 |
|
|
0.08 |
|
Total |
$ |
3.57 |
|
|
$ |
1.43 |
|
|
$ |
4.81 |
|
|
$ |
5.51 |
|
Weighted average common shares outstanding - Basic |
156.6 |
|
118.2 |
|
135.0 |
|
119.1 |
|
|
|
|
|
|
|
|
Net Earnings (Loss) per Share - Diluted |
|
|
|
|
|
|
|
Continuing operations |
$ |
3.49 |
|
|
$ |
1.43 |
|
|
$ |
4.71 |
|
|
$ |
5.37 |
|
Discontinued operations |
0.05 |
|
|
(0.01 |
) |
|
0.06 |
|
|
0.08 |
|
Total |
$ |
3.54 |
|
|
$ |
1.42 |
|
|
$ |
4.77 |
|
|
$ |
5.45 |
|
Weighted average common shares outstanding - Diluted |
157.8 |
|
119.3 |
|
136.1 |
|
120.4 |
ANDEAVOR
SELECTED SEGMENT OPERATING DATA (Unaudited) (In
millions)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Earnings Before Income Taxes |
|
|
|
|
|
|
|
Marketing |
$ |
175 |
|
|
$ |
273 |
|
|
$ |
544 |
|
|
$ |
661 |
|
Logistics |
164 |
|
|
127 |
|
|
481 |
|
|
364 |
|
Refining |
762 |
|
|
58 |
|
|
841 |
|
|
492 |
|
Total Segment Operating Income |
1,101 |
|
|
458 |
|
|
1,866 |
|
|
1,517 |
|
Corporate and unallocated costs |
(158 |
) |
|
(98 |
) |
|
(508 |
) |
|
(260 |
) |
Intersegment eliminations |
11 |
|
|
- |
|
|
9 |
|
|
- |
|
Operating Income |
954 |
|
|
360 |
|
|
1,367 |
|
|
1,257 |
|
Interest and financing costs, net |
(97 |
) |
|
(70 |
) |
|
(273 |
) |
|
(190 |
) |
Equity
in earnings of equity method investments |
11 |
|
|
7 |
|
|
14 |
|
|
12 |
|
Other income (expense), net |
(1 |
) |
|
- |
|
|
10 |
|
|
32 |
|
Earnings Before Income Taxes |
$ |
867 |
|
|
$ |
297 |
|
|
$ |
1,118 |
|
|
$ |
1,111 |
|
Depreciation and Amortization Expenses |
|
|
|
|
|
|
|
Marketing |
$ |
18 |
|
|
$ |
12 |
|
|
$ |
45 |
|
|
$ |
36 |
|
Logistics |
83 |
|
|
47 |
|
|
209 |
|
|
139 |
|
Refining |
173 |
|
|
146 |
|
|
474 |
|
|
440 |
|
Corporate |
6 |
|
|
6 |
|
|
20 |
|
|
18 |
|
Intersegment eliminations |
(7 |
) |
|
- |
|
|
(9 |
) |
|
- |
|
Total Depreciation and Amortization Expenses |
$ |
273 |
|
|
$ |
211 |
|
|
$ |
739 |
|
|
$ |
633 |
|
Segment EBITDA |
|
|
|
|
|
|
|
Marketing |
$ |
193 |
|
|
$ |
285 |
|
|
$ |
589 |
|
|
$ |
697 |
|
Logistics |
252 |
|
|
177 |
|
|
700 |
|
|
519 |
|
Refining |
940 |
|
|
208 |
|
|
1,327 |
|
|
959 |
|
Total Segment EBITDA |
$ |
1,385 |
|
|
$ |
670 |
|
|
$ |
2,616 |
|
|
$ |
2,174 |
|
Capital Expenditures |
|
|
|
|
|
|
|
Marketing |
$ |
18 |
|
|
$ |
3 |
|
|
$ |
31 |
|
|
$ |
22 |
|
Logistics |
59 |
|
|
61 |
|
|
153 |
|
|
181 |
|
Refining |
264 |
|
|
134 |
|
|
550 |
|
|
353 |
|
Corporate |
57 |
|
|
29 |
|
|
157 |
|
|
68 |
|
Total Capital Expenditures |
$ |
398 |
|
|
$ |
227 |
|
|
$ |
891 |
|
|
$ |
624 |
|
Turnaround Expenditures and Branding
Costs |
|
|
|
|
|
|
|
Turnarounds and catalysts |
$ |
98 |
|
|
$ |
42 |
|
|
$ |
405 |
|
|
$ |
233 |
|
Marketing branding |
20 |
|
|
15 |
|
|
57 |
|
|
55 |
|
Total Turnaround Expenditures and Branding
Costs |
$ |
118 |
|
|
$ |
57 |
|
|
$ |
462 |
|
|
$ |
288 |
|
ANDEAVOR
RECONCILIATION OF AMOUNTS REPORTED UNDER U.S. GAAP
(Unaudited) (In millions)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Reconciliation of Net Earnings to EBITDA |
|
|
|
|
|
|
|
Net Earnings |
$ |
601 |
|
|
$ |
201 |
|
|
$ |
775 |
|
|
$ |
759 |
|
Depreciation and amortization expenses |
273 |
|
|
211 |
|
|
739 |
|
|
633 |
|
Interest and financing costs, net |
97 |
|
|
70 |
|
|
273 |
|
|
190 |
|
Income
tax expense |
274 |
|
|
95 |
|
|
351 |
|
|
362 |
|
EBITDA |
$ |
1,245 |
|
|
$ |
577 |
|
|
$ |
2,138 |
|
|
$ |
1,944 |
|
Reconciliation of Marketing Operating Income to
Marketing Segment EBITDA |
|
|
|
|
|
|
|
Marketing Segment Operating Income |
$ |
175 |
|
|
$ |
273 |
|
|
$ |
544 |
|
|
$ |
661 |
|
Depreciation and amortization expenses |
18 |
|
|
12 |
|
|
45 |
|
|
36 |
|
Segment EBITDA |
$ |
193 |
|
|
$ |
285 |
|
|
$ |
589 |
|
|
$ |
697 |
|
|
|
|
|
|
|
|
|
Reconciliation of Logistics Operating Income to
Logistics Segment EBITDA |
|
|
|
|
|
|
|
Logistics Segment Operating Income |
$ |
164 |
|
|
$ |
127 |
|
|
$ |
481 |
|
|
$ |
364 |
|
Depreciation and amortization expenses |
83 |
|
|
47 |
|
|
209 |
|
|
139 |
|
Equity
in earnings of equity method investments |
2 |
|
|
3 |
|
|
7 |
|
|
10 |
|
Other
income, net |
3 |
|
|
- |
|
|
3 |
|
|
6 |
|
Segment EBITDA |
$ |
252 |
|
|
$ |
177 |
|
|
$ |
700 |
|
|
$ |
519 |
|
|
|
|
|
|
|
|
|
Reconciliation of Refining Operating Income to
Refining Segment EBITDA |
|
|
|
|
|
|
|
Refining Segment Operating Income |
$ |
762 |
|
|
$ |
58 |
|
|
$ |
841 |
|
|
$ |
492 |
|
Depreciation and amortization expenses |
173 |
|
|
146 |
|
|
474 |
|
|
440 |
|
Equity
in earnings of equity method investments |
9 |
|
|
4 |
|
|
7 |
|
|
2 |
|
Other income (expense), net |
(4 |
) |
|
- |
|
|
5 |
|
|
25 |
|
Segment EBITDA |
$ |
940 |
|
|
$ |
208 |
|
|
$ |
1,327 |
|
|
$ |
959 |
|
ANDEAVOR
OTHER SUMMARY FINANCIAL INFORMATION (Unaudited)
(In millions)
Western Refining Acquisition - Summary of
Integration, Acquisition and Deal-Related Costs
(Consolidated) |
|
Three Months
Ended |
|
Cumulative Total |
|
September 30, 2017 |
|
June 30, 2017 |
|
March 31, 2017 |
|
December 31, 2016 |
|
General and administrative expenses |
$ |
32 |
|
|
$ |
124 |
|
|
$ |
16 |
|
|
$ |
3 |
|
|
$ |
175 |
|
Interest and financing costs, net |
- |
|
|
11 |
|
|
17 |
|
|
21 |
|
|
49 |
|
Total before income taxes |
$ |
32 |
|
|
$ |
135 |
|
|
$ |
33 |
|
|
$ |
24 |
|
|
$ |
224 |
|
Components of Our Cash Flows |
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Cash Flows From (Used in): |
|
|
|
|
|
|
|
Operating activities |
$ |
431 |
|
|
$ |
573 |
|
|
$ |
1,201 |
|
|
$ |
1,201 |
|
Investing activities |
(525 |
) |
|
(214 |
) |
|
(1,973 |
) |
|
(1,020 |
) |
Financing activities |
(439 |
) |
|
(93 |
) |
|
(1,995 |
) |
|
264 |
|
Increase (Decrease) in Cash and Cash Equivalents |
$ |
(533 |
) |
|
$ |
266 |
|
|
$ |
(2,767 |
) |
|
$ |
445 |
|
Other Financial Information |
|
|
September 30,
2017 |
|
December 31,
2016 |
Total
market value of Andeavor Logistics units held by Andeavor (a) |
$ |
1,705 |
|
|
$ |
1,730 |
|
Total
market value of WNRL units held by Andeavor (b) |
$ |
826 |
|
|
$ |
- |
|
Cash Distributions Received From Andeavor
Logistics and WNRL (c): |
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
For
common units held |
$ |
48 |
|
|
$ |
27 |
|
|
$ |
111 |
|
|
$ |
79 |
|
For
general partner units held |
46 |
|
|
38 |
|
|
131 |
|
|
95 |
|
Total Cash Distributions Received from Andeavor Logistics
and WNRL |
$ |
94 |
|
|
$ |
65 |
|
|
$ |
242 |
|
|
$ |
174 |
|
(a) Represents market
value of the 34,055,042 common units held by Andeavor at both
September 30, 2017, and December 31, 2016, respectively.
The market values were $50.06 and $50.81 per unit based on the
closing unit price at September 30, 2017 and December 31,
2016, respectively.
(b) Represents market value of the 32,018,847 common
units held by Andeavor at September 30, 2017. The market
values were $25.80 per unit based on the closing unit price at
September 30, 2017.
(c) Represents distributions received from Andeavor
Logistics and WNRL during the three and nine months ended
September 30, 2017 and 2016 on common units and general
partner units held by Andeavor.
ANDEAVOR
SEGMENT OPERATING DATA AND RESULTS (Unaudited) ($
in millions, except cents per gallon)
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
MARKETING SEGMENT |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Revenues |
|
$ |
5,864 |
|
|
$ |
4,141 |
|
|
$ |
14,772 |
|
|
$ |
11,558 |
|
Expenses |
|
|
|
|
|
|
|
|
Cost of fuels and other (excluding items shown separately
below) |
|
5,503 |
|
|
3,778 |
|
|
13,834 |
|
|
10,625 |
|
Operating expenses (excluding depreciation and
amortization) |
|
164 |
|
|
73 |
|
|
334 |
|
|
221 |
|
Depreciation and amortization expenses |
|
18 |
|
|
12 |
|
|
45 |
|
|
36 |
|
Selling, general and administrative expenses |
|
4 |
|
|
5 |
|
|
14 |
|
|
12 |
|
Loss on asset disposals |
|
- |
|
|
- |
|
|
1 |
|
|
3 |
|
Segment Operating Income |
|
$ |
175 |
|
|
$ |
273 |
|
|
$ |
544 |
|
|
$ |
661 |
|
Fuel Sales (millions of gallons) |
|
|
|
|
|
|
|
|
Retail |
|
|
500 |
|
|
304 |
|
|
1,131 |
|
|
887 |
|
Branded |
|
|
884 |
|
|
872 |
|
|
2,558 |
|
|
2,527 |
|
Total Retail and Branded |
|
|
1,384 |
|
|
1,176 |
|
|
3,689 |
|
|
3,414 |
|
Unbranded |
|
|
1,399 |
|
|
1,135 |
|
|
3,575 |
|
|
3,284 |
|
Total Fuel Sales |
|
|
2,783 |
|
|
2,311 |
|
|
7,264 |
|
|
6,698 |
|
Fuel Margin (d)(e) |
|
|
|
|
|
|
|
|
|
Retail
and Branded |
|
|
$ |
267 |
|
|
$ |
298 |
|
|
$ |
738 |
|
|
$ |
838 |
|
Unbranded |
|
|
13 |
|
|
46 |
|
|
62 |
|
|
42 |
|
Total Fuel Margin |
|
|
$ |
280 |
|
|
$ |
344 |
|
|
$ |
800 |
|
|
$ |
880 |
|
|
|
|
|
|
|
|
|
|
|
Merchandise Margin (e) |
|
|
$ |
54 |
|
|
$ |
3 |
|
|
$ |
77 |
|
|
$ |
7 |
|
|
|
|
|
|
|
|
|
|
|
Fuel Margin (¢/gallon) (d)(e) |
|
|
|
|
|
|
Retail
and Branded Fuel Margin |
|
|
19.3 |
¢ |
|
25.3 |
¢ |
|
20.0 |
¢ |
|
24.6 |
¢ |
Unbranded Fuel Margin |
|
|
0.9 |
¢ |
|
4.1 |
¢ |
|
1.7 |
¢ |
|
1.3 |
¢ |
Total
Fuel Margin |
|
|
10.0 |
¢ |
|
14.9 |
¢ |
|
11.0 |
¢ |
|
13.2 |
¢ |
|
|
|
|
|
|
|
|
|
|
Merchandise Margin % (e) |
|
|
27.6 |
% |
|
35.1 |
% |
|
28.0 |
% |
|
35.4 |
% |
|
|
|
|
|
|
|
|
|
|
Number of Branded Stores (at the end of
the period) |
|
|
|
September 30, 2017 |
|
September 30, 2016 |
Company operated |
|
|
|
|
|
|
479 |
|
|
- |
|
MSO-operated |
|
|
|
|
|
|
611 |
|
|
590 |
|
Total Retail Stores |
|
|
|
|
|
|
1,090 |
|
|
590 |
|
Jobber/Dealer operated |
|
|
|
|
|
|
2,034 |
|
|
1,877 |
|
Total Retail and Branded Stores |
|
|
|
|
|
3,124 |
|
|
2,467 |
|
(d) Management uses
fuel margin and fuel margin per gallon to compare fuel results and
merchandise margin percentage to compare retail results to other
companies in the industry. There are a variety of ways to calculate
fuel margin, fuel margin per gallon and merchandise margin
percentage and different companies may calculate these measures in
different ways. Refer to "Non-GAAP Measures" for details on how
these metrics are calculated. Fuel margin and fuel margin per
gallon include the effect of intersegment purchases from the
Refining segment.
(e) See "Non-GAAP Measures" and "Non-GAAP
Reconciliations" for further information regarding these non-GAAP
measures.
ANDEAVOR
SEGMENT OPERATING DATA AND RESULTS (Unaudited) ($
in millions, except per barrel amounts)
LOGISTICS SEGMENT |
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
Segment Operating Income |
2017 |
|
2016 |
|
2017 |
|
2016 |
Revenues |
|
|
|
|
|
|
|
Terminalling and transportation |
|
|
|
|
|
|
|
Terminalling |
$ |
188 |
|
|
$ |
125 |
|
|
$ |
492 |
|
|
$ |
345 |
|
Pipeline transportation |
34 |
|
|
32 |
|
|
97 |
|
|
93 |
|
Gathering and Processing |
|
|
|
|
|
|
|
NGL
sales (g) |
90 |
|
|
24 |
|
|
254 |
|
|
78 |
|
Gas
gathering and processing |
85 |
|
|
67 |
|
|
252 |
|
|
198 |
|
Crude
oil and water gathering |
67 |
|
|
33 |
|
|
147 |
|
|
100 |
|
Pass-thru and other revenue |
37 |
|
|
27 |
|
|
111 |
|
|
87 |
|
Wholesale |
|
|
|
|
|
|
|
Fuel
sales |
565 |
|
|
- |
|
|
730 |
|
|
- |
|
Other
wholesale |
18 |
|
|
- |
|
|
28 |
|
|
- |
|
Logistics Revenues (f) |
1,084 |
|
|
308 |
|
|
2,111 |
|
|
901 |
|
Expenses |
|
|
|
|
|
|
|
Terminalling and Transportation |
|
|
|
|
|
|
|
Operating expenses (excluding depreciation and amortization)
(i) |
65 |
|
|
48 |
|
|
174 |
|
|
143 |
|
Gathering and Processing |
|
|
|
|
|
|
|
NGL
expense (excluding items shown separately below) (g)(h) |
64 |
|
|
1 |
|
|
179 |
|
|
2 |
|
Operating expenses (excluding depreciation and amortization)
(i) |
100 |
|
|
58 |
|
|
259 |
|
|
179 |
|
Wholesale |
|
|
|
|
|
|
|
Cost
of fuel (excluding items shown separately below) |
554 |
|
|
- |
|
|
716 |
|
|
- |
|
Operating expenses (excluding depreciation and amortization)
(i) |
19 |
|
|
- |
|
|
29 |
|
|
- |
|
Depreciation and amortization expenses |
83 |
|
|
47 |
|
|
209 |
|
|
139 |
|
General and administrative expenses (j) |
34 |
|
|
25 |
|
|
89 |
|
|
71 |
|
Gain
(loss) on asset disposals and impairments |
1 |
|
|
2 |
|
|
(25 |
) |
|
3 |
|
Segment Operating Income |
$ |
164 |
|
|
$ |
127 |
|
|
$ |
481 |
|
|
$ |
364 |
|
|
|
|
|
|
|
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Terminalling and Transportation |
|
|
|
|
|
|
|
Terminalling throughput (Mbpd) |
1,718 |
|
|
1,038 |
|
|
1,346 |
|
|
1,013 |
|
Average terminalling revenue per barrel (k) |
$ |
1.19 |
|
|
$ |
1.31 |
|
|
$ |
1.34 |
|
|
$ |
1.25 |
|
Pipeline transportation throughput (Mbpd) |
907 |
|
|
908 |
|
|
887 |
|
|
866 |
|
Average pipeline transportation revenue per barrel (k) |
$ |
0.40 |
|
|
$ |
0.38 |
|
|
$ |
0.40 |
|
|
$ |
0.39 |
|
Gathering and Processing |
|
|
|
|
|
|
|
NGL
sales (Mbpd) (l) |
7.0 |
|
|
6.8 |
|
|
7.3 |
|
|
7.7 |
|
Average margin on NGL sales per barrel (e)(g)(h)(k) |
$ |
38.30 |
|
|
$ |
38.71 |
|
|
$ |
38.27 |
|
|
$ |
36.48 |
|
Gas
gathering and processing throughput (thousands of MMBtu/d) |
961 |
|
|
885 |
|
|
955 |
|
|
881 |
|
Average gas gathering and processing revenue per MMBtu (k) |
$ |
0.96 |
|
|
$ |
0.82 |
|
|
$ |
0.97 |
|
|
$ |
0.82 |
|
Crude
oil and water gathering volume (Mbpd) |
333 |
|
|
206 |
|
|
285 |
|
|
210 |
|
Average crude oil and water gathering revenue per barrel (k) |
$ |
2.19 |
|
|
$ |
1.71 |
|
|
$ |
1.89 |
|
|
$ |
1.73 |
|
Wholesale |
|
|
|
|
|
|
|
Fuel
sales (millions of gallons) |
320 |
|
|
- |
|
|
421 |
|
|
- |
|
Average wholesale fuel sales margin per gallon (e)(k) |
$ |
0.03 |
|
|
$ |
- |
|
|
$ |
0.03 |
|
|
$ |
- |
|
(f) Included in
our Refining segment's cost of materials and other were Logistics
segment revenues for services provided to our Refining segment of
$461 million and $184 million for the three months ended
September 30, 2017 and 2016, respectively, and $935 million
and $521 million for the nine months ended September 30, 2017
and 2016, respectively. These amounts are eliminated upon
consolidation.
(g) For the three months ended September 30, 2017,
our Logistics segment had 21.1 Mbpd of gross natural gas liquids
("NGL") sales under percent of proceeds ("POP") and keep-whole
arrangements. Our Logistics segment retained 7.0 Mbpd under these
arrangements. For the nine months ended September 30, 2017,
Logistics had 21.0 Mbpd of NGL sales under POP and keep-whole
arrangements. Our Logistics segment retained 7.3 Mbpd under these
arrangements.The difference between gross sales barrels and barrels
retained is reflected in NGL expense resulting from the gross
presentation required for the POP arrangements associated with the
North Dakota Gathering and Processing Assets.
(h) Included in NGL expense for the nine months ended
September 30, 2017 were approximately $2 million of cost of
sales related to crude oil volumes obtained in connection with the
North Dakota Gathering and Processing Assets acquisition. The
corresponding revenues were recognized in pass-thru and other
revenue. As such, the calculation of the average margin on NGL
sales per barrel for the nine months ended September 30, 2017
excludes this amount.
(i) Our Logistics segment operating
expenses include amounts billed by Andeavor for services provided
to our Logistics segment under various operational contracts.
Amounts billed by Andeavor totaled $49 million and $38 million for
the three months ended September 30, 2017 and 2016,
respectively, and $132 million and $107 million for the nine months
ended September 30, 2017 and 2016, respectively. The net
amounts billed include reimbursements of $7 million and $3
million for the three months ended September 30, 2017 and
2016, and $12 million for both the nine months ended
September 30, 2017 and 2016. These amounts are eliminated upon
consolidation. Logistics segment third-party operating expenses
related to the transportation of crude oil and refined products
related to Andeavor's sale of those refined products during the
ordinary course of business are reclassified to cost of materials
and other upon consolidation.
(j) Our Logistics segment general and
administrative expenses include amounts charged by Andeavor for
general and administrative services provided to our Logistics
segment under various operational and administrative contracts.
These amounts totaled $23 million and $19 million for the three
months ended September 30, 2017 and 2016, respectively, and
$62 million and $52 million for the nine months ended
September 30, 2017 and 2016, respectively, and are eliminated
upon consolidation. General and administrative expenses are
reclassified to cost of materials and other as it relates to
Andeavor's sale of refined products in our statements of
consolidated operations upon consolidation.
(k) Our Logistics segment uses average margin per
barrel, average revenue per MMBtu, average margin per gallon and
average revenue per barrel to evaluate performance and compare
profitability to other companies in the industry.
· Average terminalling revenue per
barrel-calculated as total terminalling revenue divided by total
terminalling throughput;
· Average pipeline transportation
revenue per barrel-calculated as total pipeline transportation
revenue divided by total pipeline transportation
throughput;
· Average margin on NGL sales per
barrel-calculated as the difference between the NGL sales revenues
and the amounts recognized as NGL expense divided by our NGL sales
volumes;
· Average gas gathering and
processing revenue per Million British thermal units
("MMBtu")-calculated as total gathering and processing fee-based
revenue divided by total gas gathering throughput;
· Average crude oil and water
gathering revenue per barrel-calculated as total crude oil and
water gathering fee-based revenue divided by total crude oil and
water gathering throughput; and
· Average wholesale fuel sales
margin per gallon-calculated as the difference between the fuel
sales and the costs associated with the fuel sales divided by total
fuel sales volumes.
There are a variety of ways to calculate these measures; other
companies may calculate these in a different way.
(l) Volumes represent barrels sold under
Logistics' keep-whole arrangements, net barrels retained under its
percent of proceeds ("POP") arrangements and other associated
products.
ANDEAVOR
SEGMENT OPERATING DATA AND RESULTS (Unaudited) ($
in millions, except per barrel amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
REFINING SEGMENT |
2017 |
|
2016 |
|
2017 |
|
2016 |
Revenues |
|
|
|
|
|
|
|
Refined products (m) |
$ |
8,551 |
|
|
$ |
5,641 |
|
|
$ |
21,021 |
|
|
$ |
15,434 |
|
Crude
oil resales and other |
457 |
|
|
257 |
|
|
1,092 |
|
|
710 |
|
Refining Revenues |
9,008 |
|
|
5,898 |
|
|
22,113 |
|
|
16,144 |
|
Refining Cost of Materials and
Expense |
Cost
of materials and other (excluding items shown separately below)
(f) |
7,633 |
|
|
5,189 |
|
|
19,060 |
|
|
13,965 |
|
Lower
of cost or market adjustments |
(209 |
) |
|
(20 |
) |
|
- |
|
|
(236 |
) |
Operating expenses (excluding depreciation and amortization): |
|
|
|
|
|
|
|
Manufacturing costs (n) |
529 |
|
|
412 |
|
|
1,410 |
|
|
1,172 |
|
Other operating expenses |
118 |
|
|
113 |
|
|
317 |
|
|
307 |
|
Total
operating expenses |
647 |
|
|
525 |
|
|
1,727 |
|
|
1,479 |
|
Depreciation and amortization expenses |
173 |
|
|
146 |
|
|
474 |
|
|
440 |
|
General and administrative expenses |
2 |
|
|
- |
|
|
7 |
|
|
4 |
|
Loss on asset disposals |
- |
|
|
- |
|
|
4 |
|
|
- |
|
Segment Operating Income |
$ |
762 |
|
|
$ |
58 |
|
|
$ |
841 |
|
|
$ |
492 |
|
|
|
|
|
|
|
|
|
Refining margin (e)(o) |
$ |
1,584 |
|
|
$ |
729 |
|
|
$ |
3,053 |
|
|
$ |
2,415 |
|
Refining margin ($/throughput barrel) (e)(o) |
$ |
15.09 |
|
|
$ |
9.08 |
|
|
$ |
11.72 |
|
|
$ |
10.75 |
|
Manufacturing costs (excluding depreciation and amortization) per
throughput barrel (e)(n)(o) |
$ |
5.03 |
|
|
$ |
5.11 |
|
|
$ |
5.41 |
|
|
$ |
5.22 |
|
|
|
|
|
|
|
|
|
Total Refining Segment |
|
|
|
|
|
|
|
Throughput (Mbpd) |
|
|
|
|
|
|
|
Heavy
crude |
194 |
|
|
186 |
|
|
270 |
|
|
176 |
|
Light
crude |
879 |
|
|
636 |
|
|
612 |
|
|
595 |
|
Other feedstocks |
68 |
|
|
52 |
|
|
72 |
|
|
48 |
|
Total Throughput |
1,141 |
|
|
874 |
|
|
954 |
|
|
819 |
|
Yield (Mbpd) |
|
|
|
|
|
|
|
Gasoline and gasoline blendstocks |
573 |
|
|
455 |
|
|
576 |
|
|
449 |
|
Diesel
fuel |
287 |
|
|
202 |
|
|
269 |
|
|
183 |
|
Jet
fuel |
142 |
|
|
133 |
|
|
138 |
|
|
117 |
|
Other |
144 |
|
|
143 |
|
|
126 |
|
|
126 |
|
Total Yield |
1,146 |
|
|
933 |
|
|
1,109 |
|
|
875 |
|
Refined Product Sales (Mbpd) (p) |
|
|
|
|
|
|
|
Gasoline and gasoline blendstocks |
741 |
|
|
531 |
|
|
608 |
|
|
527 |
|
Diesel
fuel |
287 |
|
|
215 |
|
|
233 |
|
|
204 |
|
Jet
fuel |
163 |
|
|
158 |
|
|
153 |
|
|
145 |
|
Other |
133 |
|
|
112 |
|
|
131 |
|
|
105 |
|
Total Refined Product Sales |
1,324 |
|
|
1,016 |
|
|
1,125 |
|
|
981 |
|
(m) Refined product sales
include intersegment sales to our Marketing segment of $4.2 billion
and $3.6 billion for the three months ended September 30, 2017
and 2016, respectively, and $11.9 billion and $10.2 billion for the
nine months ended September 30, 2017 and 2016,
respectively.
(n) Manufacturing costs represent direct operating
expenses incurred by our Refining segment for the production of
refined products.
(o) Management uses various measures to evaluate
performance and efficiency and to compare profitability to other
companies in the industry, including refining margin, refining
margin per barrel of throughput and manufacturing costs before
depreciation and amortization expenses ("Manufacturing Costs") per
throughput barrel. Refer to "Non-GAAP Measures" for details on how
these metrics are calculated.
(p) Sources of total refined product sales include
refined products manufactured at our refineries and refined
products purchased from third parties. Total refined product sales
include sales of manufactured and purchased refined products.
Refined product sales include all sales through our Marketing
segment as well as in bulk markets and exports through our Refining
segment.
ANDEAVOR
SEGMENT OPERATING DATA AND RESULTS (Unaudited) ($
in millions, except per barrel amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
Refining By Region |
2017 |
|
2016 |
|
2017 |
|
2016 |
California (Martinez and Los
Angeles) |
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
Refined products (m) |
$ |
4,128 |
|
|
$ |
3,680 |
|
|
$ |
12,100 |
|
|
$ |
10,358 |
|
Crude
oil resales and other |
75 |
|
|
55 |
|
|
296 |
|
|
157 |
|
Regional Revenue |
4,203 |
|
|
3,735 |
|
|
12,396 |
|
|
10,515 |
|
Refining Cost of Materials and
Expenses |
Cost
of materials and other (excluding items shown separately
below) |
3,660 |
|
|
3,292 |
|
|
10,760 |
|
|
9,076 |
|
LCM |
(98 |
) |
|
(10 |
) |
|
- |
|
|
(154 |
) |
Operating expenses (excluding depreciation and amortization): |
|
|
|
|
|
|
|
Manufacturing costs (n) |
285 |
|
|
285 |
|
|
871 |
|
|
823 |
|
Other operating expenses |
66 |
|
|
55 |
|
|
181 |
|
|
141 |
|
Total
operating expenses |
351 |
|
|
340 |
|
|
1,052 |
|
|
964 |
|
Depreciation and amortization expenses |
98 |
|
|
92 |
|
|
285 |
|
|
280 |
|
General and administrative expenses |
1 |
|
|
(1 |
) |
|
5 |
|
|
3 |
|
Loss
on asset disposals |
- |
|
|
- |
|
|
4 |
|
|
- |
|
Operating Income |
$ |
191 |
|
|
$ |
22 |
|
|
$ |
290 |
|
|
$ |
346 |
|
|
|
|
|
|
|
|
|
Refining margin (e)(o) |
$ |
641 |
|
|
$ |
453 |
|
|
$ |
1,636 |
|
|
$ |
1,593 |
|
Refining margin per throughput barrel (e)(o) |
$ |
13.37 |
|
|
$ |
9.24 |
|
|
$ |
11.59 |
|
|
$ |
11.54 |
|
Manufacturing costs (excluding depreciation and amortization) per
throughput barrel (e)(n)(o) |
$ |
5.95 |
|
|
$ |
5.79 |
|
|
$ |
6.17 |
|
|
$ |
5.97 |
|
Capital Expenditures |
$ |
117 |
|
|
$ |
72 |
|
|
$ |
258 |
|
|
$ |
188 |
|
|
|
|
|
|
|
|
|
Throughput (Mbpd) |
|
|
|
|
|
|
|
Heavy
crude |
158 |
|
|
177 |
|
|
159 |
|
|
170 |
|
Light
crude |
322 |
|
|
321 |
|
|
319 |
|
|
301 |
|
Other
feedstocks |
41 |
|
|
35 |
|
|
39 |
|
|
33 |
|
Total Throughput |
521 |
|
|
533 |
|
|
517 |
|
|
504 |
|
|
|
|
|
|
|
|
|
Yield (Mbpd) |
|
|
|
|
|
|
|
Gasoline and gasoline blendstocks |
260 |
|
|
297 |
|
|
277 |
|
|
293 |
|
Diesel
fuel |
118 |
|
|
120 |
|
|
114 |
|
|
107 |
|
Jet
fuel |
73 |
|
|
79 |
|
|
72 |
|
|
71 |
|
Other |
79 |
|
|
86 |
|
|
65 |
|
|
78 |
|
Total Yield |
530 |
|
|
582 |
|
|
528 |
|
|
549 |
|
ANDEAVOR
SEGMENT OPERATING DATA AND RESULTS (Unaudited) ($
in millions, except per barrel amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Pacific Northwest (Washington and
Alaska) |
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
Refined products (m) |
$ |
1,306 |
|
|
$ |
1,146 |
|
|
$ |
3,572 |
|
|
$ |
2,934 |
|
Crude
oil resales and other |
52 |
|
|
89 |
|
|
170 |
|
|
175 |
|
Regional Revenue |
1,358 |
|
|
1,235 |
|
|
3,742 |
|
|
3,109 |
|
Refining Cost of Materials and
Expenses |
Cost
of materials and other (excluding items shown separately
below) |
1,122 |
|
|
1,117 |
|
|
3,259 |
|
|
2,778 |
|
LCM |
(46 |
) |
|
(8 |
) |
|
- |
|
|
(60 |
) |
Operating expenses (excluding depreciation and amortization): |
|
|
|
|
|
|
|
Manufacturing costs (n) |
65 |
|
|
69 |
|
|
205 |
|
|
190 |
|
Other operating expenses |
21 |
|
|
15 |
|
|
59 |
|
|
43 |
|
Total
operating expenses |
86 |
|
|
84 |
|
|
264 |
|
|
233 |
|
Depreciation and amortization expenses |
26 |
|
|
25 |
|
|
80 |
|
|
69 |
|
General and administrative expenses |
- |
|
|
1 |
|
|
- |
|
|
1 |
|
Operating Income |
$ |
170 |
|
|
$ |
16 |
|
|
$ |
139 |
|
|
$ |
88 |
|
|
|
|
|
|
|
|
|
Refining margin (e)(o) |
$ |
282 |
|
|
$ |
126 |
|
|
$ |
483 |
|
|
$ |
391 |
|
Refining margin per throughput barrel (e)(o) |
$ |
15.03 |
|
|
$ |
7.17 |
|
|
$ |
9.46 |
|
|
$ |
8.02 |
|
Manufacturing costs (excluding depreciation and amortization) per
throughput barrel (e)(n)(o) |
$ |
3.46 |
|
|
$ |
3.87 |
|
|
$ |
4.02 |
|
|
$ |
3.87 |
|
Capital Expenditures |
$ |
38 |
|
|
$ |
29 |
|
|
$ |
103 |
|
|
$ |
96 |
|
|
|
|
|
|
|
|
|
Throughput (Mbpd) |
|
|
|
|
|
|
|
Heavy
crude |
9 |
|
|
9 |
|
|
8 |
|
|
6 |
|
Light
crude |
180 |
|
|
171 |
|
|
163 |
|
|
161 |
|
Other feedstocks |
15 |
|
|
11 |
|
|
16 |
|
|
11 |
|
Total Throughput |
204 |
|
|
191 |
|
|
187 |
|
|
178 |
|
|
|
|
|
|
|
|
|
Yield (Mbpd) |
|
|
|
|
|
|
|
Gasoline and gasoline blendstocks |
88 |
|
|
79 |
|
|
81 |
|
|
79 |
|
Diesel
fuel |
39 |
|
|
37 |
|
|
34 |
|
|
34 |
|
Jet
fuel |
41 |
|
|
40 |
|
|
39 |
|
|
34 |
|
Other |
33 |
|
|
42 |
|
|
30 |
|
|
36 |
|
Total Yield |
201 |
|
|
198 |
|
|
184 |
|
|
183 |
|
ANDEAVOR
SEGMENT OPERATING DATA AND RESULTS (Unaudited) ($
in millions, except per barrel amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Mid-Continent (North Dakota,
Utah, New Mexico, Texas, and Minnesota) |
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
Refined products (m) |
$ |
3,117 |
|
|
$ |
815 |
|
|
$ |
5,349 |
|
|
$ |
2,142 |
|
Crude oil resales and other |
330 |
|
|
113 |
|
|
626 |
|
|
378 |
|
Regional Revenue |
3,447 |
|
|
928 |
|
|
5,975 |
|
|
2,520 |
|
Refining Cost of Materials and
Expenses |
Cost
of materials and other (excluding items shown separately
below) |
2,851 |
|
|
780 |
|
|
5,041 |
|
|
2,111 |
|
LCM |
(65 |
) |
|
(2 |
) |
|
- |
|
|
(22 |
) |
Operating expenses (excluding depreciation and amortization): |
|
|
|
|
|
|
|
Manufacturing costs (n) |
179 |
|
|
58 |
|
|
334 |
|
|
159 |
|
Other operating expenses |
31 |
|
|
43 |
|
|
77 |
|
|
123 |
|
Total
operating expenses |
210 |
|
|
101 |
|
|
411 |
|
|
282 |
|
Depreciation and amortization expenses |
49 |
|
|
29 |
|
|
109 |
|
|
91 |
|
General and administrative expenses |
1 |
|
|
- |
|
|
2 |
|
|
- |
|
Operating Income |
$ |
401 |
|
|
$ |
20 |
|
|
$ |
412 |
|
|
$ |
58 |
|
|
|
|
|
|
|
|
|
Refining margin (e)(o) |
$ |
661 |
|
|
$ |
150 |
|
|
$ |
934 |
|
|
$ |
431 |
|
Refining margin per throughput barrel (e)(o) |
$ |
17.27 |
|
|
$ |
10.94 |
|
|
$ |
13.68 |
|
|
$ |
11.40 |
|
Manufacturing costs (excluding depreciation and amortization) per
throughput barrel (e)(n)(o) |
$ |
4.68 |
|
|
$ |
4.27 |
|
|
$ |
4.89 |
|
|
$ |
4.21 |
|
Capital Expenditures |
$ |
109 |
|
|
$ |
33 |
|
|
$ |
189 |
|
|
$ |
69 |
|
|
|
|
|
|
|
|
|
Throughput (Mbpd) |
|
|
|
|
|
|
|
Heavy
Crude |
27 |
|
|
- |
|
|
103 |
|
|
- |
|
Light
crude |
377 |
|
|
144 |
|
|
130 |
|
|
133 |
|
Other feedstocks |
12 |
|
|
5 |
|
|
17 |
|
|
5 |
|
Total Throughput |
416 |
|
|
149 |
|
|
250 |
|
|
138 |
|
|
|
|
|
|
|
|
|
Yield (Mbpd) |
|
|
|
|
|
|
|
Gasoline and gasoline blendstocks |
225 |
|
|
79 |
|
|
218 |
|
|
77 |
|
Diesel
fuel |
130 |
|
|
45 |
|
|
121 |
|
|
42 |
|
Jet
fuel |
28 |
|
|
14 |
|
|
27 |
|
|
12 |
|
Other |
32 |
|
|
15 |
|
|
31 |
|
|
12 |
|
Total Yield |
415 |
|
|
153 |
|
|
397 |
|
|
143 |
|
NON-GAAP
RECONCILIATIONS
FUEL MARGIN AND
MERCHANDISE MARGIN CALCULATION (dollars in millions, except cents
per gallon and percents)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Segment Operating Income |
$ |
175 |
|
|
$ |
273 |
|
|
$ |
544 |
|
|
$ |
661 |
|
Add
back: |
|
|
|
|
|
|
|
Operating expenses |
164 |
|
|
73 |
|
|
334 |
|
|
221 |
|
Depreciation and amortization expenses |
18 |
|
|
12 |
|
|
45 |
|
|
36 |
|
General and administrative expenses |
4 |
|
|
5 |
|
|
14 |
|
|
12 |
|
Loss
on asset disposals |
- |
|
|
- |
|
|
1 |
|
|
3 |
|
Marketing Margin |
$ |
361 |
|
|
$ |
363 |
|
|
$ |
938 |
|
|
$ |
933 |
|
|
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
Retail
and Branded fuel sales |
$ |
3,074 |
|
|
$ |
2,315 |
|
|
$ |
8,074 |
|
|
$ |
6,637 |
|
Unbranded fuel sales |
2,561 |
|
|
1,803 |
|
|
6,356 |
|
|
4,856 |
|
Total fuel sales |
5,635 |
|
|
4,118 |
|
|
14,430 |
|
|
11,493 |
|
Merchandise |
197 |
|
|
7 |
|
|
274 |
|
|
19 |
|
Other
sales |
32 |
|
|
16 |
|
|
68 |
|
|
46 |
|
Total Revenues |
5,864 |
|
|
4,141 |
|
|
14,772 |
|
|
11,558 |
|
Cost of Fuel and Other (excluding depreciation and
amortization) |
|
|
|
|
|
|
|
Retail
and Branded fuel costs |
2,807 |
|
|
2,017 |
|
|
7,336 |
|
|
5,799 |
|
Unbranded fuel costs |
2,548 |
|
|
1,757 |
|
|
6,294 |
|
|
4,814 |
|
Total fuel costs |
5,355 |
|
|
3,774 |
|
|
13,630 |
|
|
10,613 |
|
Purchases of merchandise |
143 |
|
|
4 |
|
|
197 |
|
|
12 |
|
Other
costs |
5 |
|
|
- |
|
|
7 |
|
|
- |
|
Total Cost of Fuel and Other |
5,503 |
|
|
3,778 |
|
|
13,834 |
|
|
10,625 |
|
Marketing Margin |
|
|
|
|
|
|
|
Retail
and Branded fuel margin |
267 |
|
|
298 |
|
|
738 |
|
|
838 |
|
Unbranded fuel margin |
13 |
|
|
46 |
|
|
62 |
|
|
42 |
|
Total fuel margin |
280 |
|
|
344 |
|
|
800 |
|
|
880 |
|
Merchandise margin |
54 |
|
|
3 |
|
|
77 |
|
|
7 |
|
Other
margin |
27 |
|
|
16 |
|
|
61 |
|
|
46 |
|
Marketing Margin |
$ |
361 |
|
|
$ |
363 |
|
|
$ |
938 |
|
|
$ |
933 |
|
Merchandise Margin Percentage (q) |
27.6 |
% |
|
35.1 |
% |
|
28.0 |
% |
|
35.4 |
% |
Fuel Sales (millions of gallons) |
|
|
|
|
|
|
|
Retail
and Branded fuel sales |
1,384 |
|
|
1,176 |
|
|
3,689 |
|
|
3,414 |
|
Unbranded fuel sales |
1,399 |
|
|
1,135 |
|
|
3,575 |
|
|
3,284 |
|
Total Fuel Sales |
2,783 |
|
|
2,311 |
|
|
7,264 |
|
|
6,698 |
|
|
|
|
|
|
|
|
|
Retail and Branded Fuel Margin (¢/gallon)
(q) |
19.3 |
¢ |
|
25.3 |
¢ |
|
20.0 |
¢ |
|
24.6 |
¢ |
Unbranded Fuel Margin (¢/gallon) (q) |
0.9 |
¢ |
|
4.1 |
¢ |
|
1.7 |
¢ |
|
1.3 |
¢ |
Total Fuel Margin (¢/gallon) (q) |
10.0 |
¢ |
|
14.9 |
¢ |
|
11.0 |
¢ |
|
13.2 |
¢ |
(q) Amounts may not
recalculate due to rounding of dollar and volume information.
AVERAGE MARGIN ON NGL SALES PER
BARREL CALCULATION (in millions, except per barrel amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Segment Operating Income |
$ |
164 |
|
|
$ |
127 |
|
|
$ |
481 |
|
|
$ |
364 |
|
Add
back: |
|
|
|
|
|
|
|
Cost
of fuel and other |
554 |
|
|
- |
|
|
716 |
|
|
- |
|
Operating expenses |
184 |
|
|
106 |
|
|
462 |
|
|
322 |
|
Depreciation and amortization expenses |
83 |
|
|
47 |
|
|
209 |
|
|
139 |
|
General and administrative expenses |
34 |
|
|
25 |
|
|
89 |
|
|
71 |
|
(Gain)
loss on asset disposals and impairments |
1 |
|
|
2 |
|
|
(25 |
) |
|
3 |
|
Other
commodity purchases |
- |
|
|
- |
|
|
2 |
|
|
- |
|
Subtract: |
|
|
|
|
|
|
|
Terminalling revenues |
(188 |
) |
|
(125 |
) |
|
(492 |
) |
|
(345 |
) |
Pipeline transportation revenues |
(34 |
) |
|
(32 |
) |
|
(97 |
) |
|
(93 |
) |
Gas
gathering and processing revenues |
(85 |
) |
|
(67 |
) |
|
(252 |
) |
|
(198 |
) |
Crude
oil gathering revenues |
(67 |
) |
|
(33 |
) |
|
(147 |
) |
|
(100 |
) |
Pass-thru and other revenues |
(37 |
) |
|
(27 |
) |
|
(111 |
) |
|
(87 |
) |
Fuel
sales |
(565 |
) |
|
- |
|
|
(730 |
) |
|
- |
|
Other
wholesale revenues |
(18 |
) |
|
- |
|
|
(28 |
) |
|
- |
|
Margin on NGL sales |
$ |
26 |
|
|
$ |
23 |
|
|
$ |
77 |
|
|
$ |
76 |
|
Divided by Total Volumes for the Period: |
|
|
|
|
|
|
|
NGLs
sales volumes (Mbpd) |
7.0 |
|
|
6.8 |
|
|
7.3 |
|
|
7.7 |
|
Number
of days in the period |
92 |
|
|
92 |
|
|
273 |
|
|
274 |
|
Total volumes for the period (thousands of
barrels)
(q) |
648.5 |
|
|
630.1 |
|
|
1,979.8 |
|
|
2,109.0 |
|
Average Margin on NGL Sales per Barrel
(q) |
$ |
38.30 |
|
|
$ |
38.71 |
|
|
$ |
38.27 |
|
|
$ |
36.48 |
|
AVERAGE WHOLESALE FUEL SALES
MARGIN PER GALLON CALCULATION (in millions, except per gallon
amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Segment Operating Income |
$ |
164 |
|
|
$ |
127 |
|
|
$ |
481 |
|
|
$ |
364 |
|
Add
back: |
|
|
|
|
|
|
|
NGL
expense |
64 |
|
|
1 |
|
|
179 |
|
|
2 |
|
Operating expenses |
184 |
|
|
106 |
|
|
462 |
|
|
322 |
|
Depreciation and amortization expenses |
83 |
|
|
47 |
|
|
209 |
|
|
139 |
|
General and administrative expenses |
34 |
|
|
25 |
|
|
89 |
|
|
71 |
|
(Gain)
Loss on asset disposals and impairments |
1 |
|
|
2 |
|
|
(25 |
) |
|
3 |
|
Subtract: |
|
|
|
|
|
|
|
Terminalling revenues |
(188 |
) |
|
(125 |
) |
|
(492 |
) |
|
(345 |
) |
Pipeline transportation revenues |
(34 |
) |
|
(32 |
) |
|
(97 |
) |
|
(93 |
) |
NGL
sales |
(90 |
) |
|
(24 |
) |
|
(254 |
) |
|
(78 |
) |
Gas
gathering and processing revenues |
(85 |
) |
|
(67 |
) |
|
(252 |
) |
|
(198 |
) |
Crude
oil gathering revenues |
(67 |
) |
|
(33 |
) |
|
(147 |
) |
|
(100 |
) |
Pass-thru and other revenues |
(37 |
) |
|
(27 |
) |
|
(111 |
) |
|
(87 |
) |
Other
wholesale revenues |
(18 |
) |
|
- |
|
|
(28 |
) |
|
- |
|
Wholesale Fuel Sales Margin |
$ |
11 |
|
|
$ |
- |
|
|
$ |
14 |
|
|
$ |
- |
|
Divided by Total Volumes for the Period: |
|
|
|
|
|
|
|
Fuel
sales volumes (millions of gallons) (q) |
320 |
|
|
- |
|
|
421 |
|
|
- |
|
Average Wholesale Fuel Sales Margin per
Gallon (q) |
$ |
0.03 |
|
|
$ |
- |
|
|
$ |
0.03 |
|
|
$ |
- |
|
REFINING MARGIN PER THROUGHPUT
BARREL CALCULATION (in millions, except per barrel amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Segment Operating Income |
$ |
762 |
|
|
$ |
58 |
|
|
$ |
841 |
|
|
$ |
492 |
|
Add
back: |
|
|
|
|
|
|
|
Manufacturing costs (excluding depreciation and amortization) |
529 |
|
|
412 |
|
|
1,410 |
|
|
1,172 |
|
Other
operating expenses (excluding depreciation and amortization) |
118 |
|
|
113 |
|
|
317 |
|
|
307 |
|
Depreciation and amortization expenses |
173 |
|
|
146 |
|
|
474 |
|
|
440 |
|
General and administrative expenses |
2 |
|
|
- |
|
|
7 |
|
|
4 |
|
Loss
on asset disposals and impairments |
- |
|
|
- |
|
|
4 |
|
|
- |
|
Refining Margin |
$ |
1,584 |
|
|
$ |
729 |
|
|
$ |
3,053 |
|
|
$ |
2,415 |
|
Divided by Total Volumes: |
|
|
|
|
|
|
|
Total
refining throughput (Mbpd) |
1,141 |
|
|
874 |
|
|
954 |
|
|
819 |
|
Number
of days in the period |
92 |
|
|
92 |
|
|
273 |
|
|
274 |
|
Total volumes for the period (millions of barrels)
(q) |
104.9 |
|
|
80.4 |
|
|
260.5 |
|
|
224.5 |
|
Refining Margin per Throughput Barrel
(q) |
$ |
15.09 |
|
|
$ |
9.08 |
|
|
$ |
11.72 |
|
|
$ |
10.75 |
|
REFINING MARGIN PER THROUGHPUT
BARREL CALCULATION BY REGION (in millions, except per barrel
amounts)
|
California
(Martinez and
Los Angeles) |
|
Pacific Northwest (Washington and
Alaska) |
|
Mid-Continent (North Dakota, Utah,
Minnesota, New Mexico and Texas) |
|
Three Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Segment Operating Income |
$ |
191 |
|
|
$ |
22 |
|
|
$ |
170 |
|
|
$ |
16 |
|
|
$ |
401 |
|
|
$ |
20 |
|
Add
back: |
|
|
|
|
|
|
|
|
|
|
|
Manufacturing costs (excluding depreciation and amortization) |
285 |
|
|
285 |
|
|
65 |
|
|
69 |
|
|
179 |
|
|
58 |
|
Other
operating expenses (excluding depreciation and amortization) |
66 |
|
|
55 |
|
|
21 |
|
|
15 |
|
|
31 |
|
|
43 |
|
Depreciation and amortization expenses |
98 |
|
|
92 |
|
|
26 |
|
|
25 |
|
|
49 |
|
|
29 |
|
General and administrative expenses |
1 |
|
|
(1 |
) |
|
- |
|
|
1 |
|
|
1 |
|
|
- |
|
Refining Margin |
$ |
641 |
|
|
$ |
453 |
|
|
$ |
282 |
|
|
$ |
126 |
|
|
$ |
661 |
|
|
$ |
150 |
|
Divided by Total Volumes: |
|
|
|
|
|
|
|
|
|
|
|
Total
refining throughput (Mbpd) |
521 |
|
|
533 |
|
|
204 |
|
|
191 |
|
|
416 |
|
|
149 |
|
Number
of days in the period |
92 |
|
|
92 |
|
|
92 |
|
|
92 |
|
|
92 |
|
|
92 |
|
Total volumes for the period (millions of barrels)
(q) |
47.9 |
|
|
49.1 |
|
|
18.7 |
|
|
17.6 |
|
|
38.3 |
|
|
13.7 |
|
Refining Margin per Throughput Barrel
(q) |
$ |
13.37 |
|
|
$ |
9.24 |
|
|
$ |
15.03 |
|
|
$ |
7.17 |
|
|
$ |
17.27 |
|
|
$ |
10.94 |
|
REFINING MARGIN PER THROUGHPUT
BARREL CALCULATION BY REGION (in millions, except per barrel
amounts)
|
California
(Martinez and
Los Angeles) |
|
Pacific Northwest (Washington and
Alaska) |
|
Mid-Continent (North Dakota, Utah,
Minnesota, New Mexico and Texas) |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Segment Operating Income |
$ |
290 |
|
|
$ |
346 |
|
|
$ |
139 |
|
|
$ |
88 |
|
|
$ |
412 |
|
|
$ |
58 |
|
Add
back: |
|
|
|
|
|
|
|
|
|
|
|
Manufacturing costs (excluding depreciation and amortization) |
871 |
|
|
823 |
|
|
205 |
|
|
190 |
|
|
334 |
|
|
159 |
|
Other
operating expenses (excluding depreciation and amortization) |
181 |
|
|
141 |
|
|
59 |
|
|
43 |
|
|
77 |
|
|
123 |
|
Depreciation and amortization expenses |
285 |
|
|
280 |
|
|
80 |
|
|
69 |
|
|
109 |
|
|
91 |
|
General and administrative expenses |
5 |
|
|
3 |
|
|
- |
|
|
1 |
|
|
2 |
|
|
- |
|
Loss
on asset disposals and impairments |
4 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Refining Margin |
$ |
1,636 |
|
|
$ |
1,593 |
|
|
$ |
483 |
|
|
$ |
391 |
|
|
$ |
934 |
|
|
$ |
431 |
|
Divided by Total Volumes: |
|
|
|
|
|
|
|
|
|
|
|
Total
refining throughput (Mbpd) |
517 |
|
|
504 |
|
|
187 |
|
|
178 |
|
|
250 |
|
|
138 |
|
Number
of days in the period |
273 |
|
|
274 |
|
|
273 |
|
|
274 |
|
|
273 |
|
|
274 |
|
Total volumes for the period (millions of barrels)
(q) |
141.2 |
|
|
137.8 |
|
|
51.0 |
|
|
48.9 |
|
|
68.3 |
|
|
37.8 |
|
Refining Margin per Throughput Barrel
(q) |
$ |
11.59 |
|
|
$ |
11.54 |
|
|
$ |
9.46 |
|
|
$ |
8.02 |
|
|
$ |
13.68 |
|
|
$ |
11.40 |
|
MANUFACTURING COSTS (EXCLUDING
DEPRECIATION AND AMORTIZATION) PER THROUGHPUT BARREL
CALCULATION (in millions, except per barrel amounts)
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Total Refining Segment operating expenses
(excluding depreciation and amortization) |
$ |
647 |
|
|
$ |
525 |
|
|
$ |
1,727 |
|
|
$ |
1,479 |
|
Subtract: |
|
|
|
|
|
|
|
Other
operating expenses (excluding depreciation and amortization) |
(118 |
) |
|
(113 |
) |
|
(317 |
) |
|
(307 |
) |
Manufacturing Costs (excluding
depreciation and amortization) |
$ |
529 |
|
|
$ |
412 |
|
|
$ |
1,410 |
|
|
$ |
1,172 |
|
Divided by Total Volumes: |
|
|
|
|
|
|
|
Total
refining throughput (Mbpd) |
1,141 |
|
|
874 |
|
|
954 |
|
|
819 |
|
Number
of days in the period |
92 |
|
|
92 |
|
|
273 |
|
|
274 |
|
Total volumes for the period (millions of barrels)
(q) |
104.9 |
|
|
80.4 |
|
|
260.5 |
|
|
224.5 |
|
Manufacturing Costs (excluding
depreciation and amortization) per Throughput Barrel (q) |
$ |
5.03 |
|
|
$ |
5.11 |
|
|
$ |
5.41 |
|
|
$ |
5.22 |
|
MANUFACTURING COSTS (EXCLUDING
DEPRECIATION AND AMORTIZATION) PER THROUGHPUT BARREL CALCULATION BY
REGION (in millions, except per barrel amounts)
|
California
(Martinez and
Los Angeles) |
|
Pacific Northwest (Washington and
Alaska) |
|
Mid-Continent (North Dakota, Utah,
Minnesota, New Mexico and Texas) |
|
Three Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Total operating expenses |
$ |
351 |
|
|
$ |
340 |
|
|
$ |
86 |
|
|
$ |
84 |
|
|
$ |
210 |
|
|
$ |
101 |
|
Subtract: |
|
|
|
|
|
|
|
|
|
|
|
Other
operating expenses (excluding depreciation and amortization) |
(66 |
) |
|
(55 |
) |
|
(21 |
) |
|
(15 |
) |
|
(31 |
) |
|
(43 |
) |
Manufacturing Costs (excluding
depreciation and amortization) |
$ |
285 |
|
|
$ |
285 |
|
|
$ |
65 |
|
|
$ |
69 |
|
|
$ |
179 |
|
|
$ |
58 |
|
Divided by Total Volumes: |
|
|
|
|
|
|
|
|
|
|
|
Total
refining throughput (Mbpd) |
521 |
|
|
533 |
|
|
204 |
|
|
191 |
|
|
416 |
|
|
149 |
|
Number
of days in the period |
92 |
|
|
92 |
|
|
92 |
|
|
92 |
|
|
92 |
|
|
92 |
|
Total volumes for the period (millions of barrels)
(q) |
47.9 |
|
|
49.1 |
|
|
18.7 |
|
|
17.6 |
|
|
38.3 |
|
|
13.7 |
|
Manufacturing Costs (excluding
depreciation and amortization) per Throughput Barrel (q) |
$ |
5.95 |
|
|
$ |
5.79 |
|
|
$ |
3.46 |
|
|
$ |
3.87 |
|
|
$ |
4.68 |
|
|
$ |
4.27 |
|
MANUFACTURING COSTS (EXCLUDING
DEPRECIATION AND AMORTIZATION) PER THROUGHPUT BARREL
CALCULATION BY REGION (in millions, except per barrel
amounts)
|
California
(Martinez and
Los Angeles) |
|
Pacific Northwest (Washington and
Alaska) |
|
Mid-Continent (North Dakota, Utah,
Minnesota, New Mexico and Texas) |
|
Nine Months
Ended September 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Total operating expenses |
$ |
1,052 |
|
|
$ |
964 |
|
|
$ |
264 |
|
|
$ |
233 |
|
|
$ |
411 |
|
|
$ |
282 |
|
Subtract: |
|
|
|
|
|
|
|
|
|
|
|
Other
operating expenses (excluding depreciation and amortization) |
(181 |
) |
|
(141 |
) |
|
(59 |
) |
|
(43 |
) |
|
(77 |
) |
|
(123 |
) |
Manufacturing Costs (excluding
depreciation and amortization) |
$ |
871 |
|
|
$ |
823 |
|
|
$ |
205 |
|
|
$ |
190 |
|
|
$ |
334 |
|
|
$ |
159 |
|
Divided by Total Volumes: |
|
|
|
|
|
|
|
|
|
|
|
Total
refining throughput (Mbpd) |
517 |
|
|
504 |
|
|
187 |
|
|
178 |
|
|
250 |
|
|
138 |
|
Number
of days in the period |
273 |
|
|
274 |
|
|
273 |
|
|
274 |
|
|
273 |
|
|
274 |
|
Total volumes for the period (millions of barrels)
(q) |
141.2 |
|
|
137.8 |
|
|
51.0 |
|
|
48.9 |
|
|
68.3 |
|
|
37.8 |
|
Manufacturing Costs (excluding
depreciation and amortization) per Throughput Barrel (q) |
$ |
6.17 |
|
|
$ |
5.97 |
|
|
$ |
4.02 |
|
|
$ |
3.87 |
|
|
$ |
4.89 |
|
|
$ |
4.21 |
|
TOTAL DEBT EXCLUDING ANDEAVOR
LOGISTICS AND WNRL (in millions)
|
September 30,
2017 |
|
December 31,
2016 |
Total debt excluding Andeavor Logistics and
WNRL: |
|
|
|
Andeavor consolidated debt (r) |
$ |
7,661 |
|
|
$ |
6,933 |
|
Andeavor Logistics debt (r) |
3,766 |
|
|
4,054 |
|
WNRL
debt (r) |
345 |
|
|
- |
|
Andeavor total debt excluding Andeavor
Logistics and WNRL (r) |
$ |
3,550 |
|
|
$ |
2,879 |
|
(r) These amounts and
calculations are shown net of unamortized issuance costs.
ANDEAVOR
RECONCILIATION OF AMOUNTS REPORTED UNDER U.S. GAAP
(Unaudited) (in millions, except percentages)
|
Anacortes Logistics Assets |
|
Projected Annual
EBITDA |
Reconciliation of Projected Net Earnings to
Projected Annual EBITDA |
|
Projected net earnings |
$
30-35 |
Add:
Depreciation and amortization expenses |
5 |
Add:
Interest and financing costs, net |
15 |
|
Projected Annual EBITDA |
$ 50-55 |
|
MLP Merger and Buy-in |
|
2018 Projected Annual
EBITDA |
Reconciliation of Projected Net Earnings to
Projected Annual EBITDA |
|
|
Projected net earnings |
$ |
625-725 |
Add:
Depreciation and amortization expenses |
|
325 |
|
Add:
Interest and financing costs, net |
|
250 |
|
Projected Annual EBITDA |
$ |
1,200-1,300 |
|
Marketing
Acquisition |
|
Projected Annual EBITDA |
Reconciliation of Projected Net Earnings to
Projected Annual EBITDA |
|
Projected net earnings |
$ |
10 |
|
Add:
Depreciation and amortization expenses |
10 |
|
Add:
Interest and financing costs, net |
5 |
|
Projected Annual EBITDA |
$ |
25 |
|
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Andeavor via Globenewswire
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