HF Sinclair (DINO) Earnings Call Presentation

Acquisition Overview - HollyFrontier Corporation (HFC) is acquiring Sonneborn for $655 million [7], which is 7x EBITDA multiple net of working capital and synergies [8] - The purchase price net of approximately $72 million in working capital is $583 million [10] - The transaction is expected to close in 2019 and is expected to generate approximately $85 million of annual EBITDA, including synergies [10] - The acquisition is expected to be immediately accretive to earnings and cash flow per share [10] Synergies and Financial Impact - HollyFrontier expects to capture approximately $20 million in annual synergies [10] - The synergies are expected to come from SG&A ($5 million), Logistics ($3 million), and Operations ($12 million) [36] - Pro forma EPS accretion is estimated at 30% in 2015, 157% in 2016, 69% in 2017, and 33% in the trailing twelve months ending July 31, 2018 [38] Assets and Operations - Sonneborn has a differentiated specialty products portfolio, including Petrolatums, White Oils, Microcrystalline Waxes, Natural Sodium Sulfonates, and Industrial Specialties [11, 16] - Sonneborn has a 3,300 barrel per day processing capacity in Petrolia, Pennsylvania [16] - Sonneborn has a 2,000 barrel per day combined processing capacity in the Netherlands [16] Market Positioning - 100% of Sonneborn earnings are attributable to the Rack Forward segment [19] - The acquisition shifts HollyFrontier's product mix towards finished products, with finished products representing 63% of the pro forma product slate by volume [28] - Pro forma sales are expected to be approximately $20 billion [28]