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1
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- Holly Corporation
- Citigroup Small / Mid-Cap Conference
- March 15, 2006
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2
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3
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- Management depth and experience
- Key comparison to peer group metrics
- Company History, Assets & Operations
- Recent growth
- CAPEX initiatives to continue growth
- Forward guidance from existing projects
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4
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- Executive officer group averages over 25 years of refining industry
experience
- Holly & subsidiary officer group averages over 20 years of
refining/energy industry experience
- Holly directors average over 20 years of refining industry experience
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5
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6
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7
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- Holly Corporation: 30+ years in the refining business
- Acquired refinery in Artesia, NM—expanded 3 times since purchase
- Acquired refinery in Great Falls, MT (in stages from 1984 to 1992)
- Acquired refinery in Woods Cross, UT in 2003
- Also built extensive logistics operations (pipelines & terminals) to
deliver refined products to end markets
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8
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- Late 1990’s: Realized value of logistics assets not given ‘full credit’
by Wall Street – Pipelines & Terminals valued at ‘refining’
multiples, not ‘logistics’ multiples
- Stand alone logistics entities receive much higher valuation on assets
than those with logistics assets embedded in refining operations
- Barriers limit substantial growth through acquisition to lever expertise
without low-cost-of-capital tax structure
- Holly responded by creating Master Limited Partnership containing
logistics assets – Holly retained 51% ownership
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9
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- July 2004: Holly Energy Partners IPO well received by investment
marketplace
- Sold 7 million common units at $22.25 ($39.30 at 3/8/06)
- Retained 49% unit ownership PLUS 2% General Partner interest, with GP
having incentive distribution rights
- Monetization of embedded asset has provided Holly $215 million in cash
from IPO and asset sale, as well as $282 million in market value of its
share of HEP
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10
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11
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12
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14
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15
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18
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19
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20
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21
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23
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25
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- Strong management team
- Strong financial fundamentals
- Strong industry fundamentals
- Favorable comparison to peer group metrics
- Operates in high margin, high growth markets
- Demonstrated growth ability
- Capital initiatives to continue growth in place
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26
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- Question period from audience
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27
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28
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29
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30
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31
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32
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Notes
