Third Quarter 2014
Earnings Conference Call and Webcast
October 30, 2014
Forward-Looking Statements
This presentation contains forward-looking statements within the meaning of federal securities laws regarding both MPC and MPLX. These forwardlooking statements relate to, among other things, expectations, estimates and projections concerning the business and operations of MPC and
MPLX. You can identify forward-looking statements by words such as “anticipate,” “believe,” “estimate,” "objective," “expect,” “forecast,” "plan,"
“project,” "potential," “could,” “may,” “should,” “would,” “will” or other similar expressions that convey the uncertainty of future events or
outcomes. Such forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors,
some of which are beyond the companies’ control and are difficult to predict. Factors that could cause MPC’s actual results to differ materially from
those in the forward-looking statements include: our ability to successfully integrate the acquired Hess retail operations and achieve the strategic
and other expected objectives relating to the acquisition, including any expected synergies; changes to the expected construction costs and timing of
pipeline projects; volatility in and/or degradation of market and industry conditions; the availability and pricing of crude oil and other feedstocks;
slower growth in domestic and Canadian crude supply; an easing or lifting of the U.S. crude oil export ban; completion of pipeline capacity to areas
outside the U.S. Midwest; consumer demand for refined products; transportation logistics; the reliability of processing units and other equipment;
our ability to successfully implement growth opportunities; modifications to MPLX earnings and distribution growth objectives; impacts from our
repurchases of shares of MPC common stock under our share repurchase authorizations, including the timing and amounts of any common stock
repurchases; state and federal environmental, economic, health and safety, energy and other policies and regulations, including the cost of
compliance with the Renewable Fuel Standard; other risk factors inherent to MPC’s industry; and the factors set forth under the heading "Risk
Factors" in MPC's Annual Report on Form 10-K for the year ended December 31, 2013, filed with the Securities and Exchange Commission (SEC).
Factors that could cause MPLX actual results to differ materially from those in the forward-looking statements include: the adequacy of MPLX capital
resources and liquidity, including, but not limited to, availability of sufficient cash flow to pay distributions and execute business plans; the timing
and extent of changes in commodity prices and demand for crude oil, refined products, feedstocks or other hydrocarbon-based products; volatility
in and/or degradation of market and industry conditions; completion of pipeline capacity by competitors; disruptions due to equipment interruption
or failure, including electrical shortages and power grid failures; the suspension, reduction or termination of MPC's obligations under commercial
agreements; the ability to successfully implement growth strategies, whether through organic growth or acquisitions; state and federal
environmental, economic, health and safety, energy and other policies and regulations; other risk factors inherent to MPLX’s industry; and the
factors set forth under the heading "Risk Factors" in MPLX's Annual Report on Form 10-K for the year ended December 31, 2013, filed with 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, in MPC’s Form 10-K or in MPLX’s Form 10-K could also have material adverse
effects on forward-looking statements.
Other Information
EBITDA, cash provided from operations before changes in working capital and free cash flow are non-GAAP financial measures provided in this
presentation. EBITDA, cash provided from operations before changes in working capital and free cash flow reconciliations to the nearest GAAP
financial measures are included in the Appendix to this presentation. EBITDA, cash provided from operations before changes in working capital and
free cash flow are not defined by GAAP and should not be considered in isolation or as an alternative to net income attributable to MPC, net cash
provided by (used in) operating, investing and financing activities or other financial measures prepared in accordance with GAAP.
2
Highlights
 Reported earnings of $672 million
 Closed Speedway acquisition of Hess’ retail operations
 Returned $442 million of capital to shareholders, including $301
million of share repurchases
 Announced plans to substantially accelerate the growth of MPLX,
and authorized sale of remaining 31 percent interest in MPLX Pipe
Line Holdings to MPLX, representing approximately $80 million of
annual EBITDA
3
Substantial Acceleration of MPLX Growth
 Grow MPLX to ~$450 MM of runrate EBITDA (December 2015
annualized), from current ~$160
MM run-rate (3Q 2014 annualized)
 Evolve MPLX into large-cap,
diversified logistics MLP
 Drop the remaining 31% interest in
MPLX Pipe Line Holdings to MPLX,
representing ~$80MM of annual
EBITDA
Adjusted EBITDA attributable to MPLX
450
400
~3x 3Q 2014
annualized
EBITDA
300
$MM
 Accelerate MPLX’s annual LP
distribution growth rate to average
mid-20% over next five years
500
200
160
111
100
-
4
Substantial Acceleration of MPLX Growth
 Rapidly changing midstream business environment creates multiple
opportunities where size matters
 Hess retail acquisition has expanded MPC’s opportunity set and strategic
options
 Identified fuels distribution EBITDA source
 Expands retained MLP-qualifying EBITDA to $1.7 billion
 Market has not appropriately reflected MPLX contribution to total value of
MPC enterprise
5
3Q 2014 Earnings*
3Q 2014
Earnings
$672 MM
$168 MM
$2.36
$0.54
Earnings per Diluted Share
Earnings
$MM
2,000
1,500
8
2,112
626
1,726
168
672
1,000
593
500
725
0
Earnings per Diluted Share
2013
6.64
6
$/Share
2,500
3Q 2013
855
199
2.07
0.54
1.83
4
2
2.17
0
2014
1Q
2013
2Q
3Q
5.95
2.36
2.95
0.67
2014
4Q
*References to Earnings refer to Net Income attributable to MPC
6
Earnings*
3Q 2014 vs. 3Q 2013 Variance Analysis
1,000
744
900
17
15
(15)
(3)
800
700
$MM
600
(252)
(2)
Income
Taxes
Noncontrolling
Interests
672
500
400
300
200
168
100
0
3Q 2013
Refining &
Marketing
Speedway
Pipeline
Transportation
Items not
Allocated to
Segments
Interest
3Q 2014
*References to Earnings refer to Net Income attributable to MPC
7
Refining and Marketing Segment Income
3Q 2014 vs. 3Q 2013 Variance Analysis
1,250
548
1,000
(152)
750
$MM
379
250
0
(22)
118
8
(95)
(40)
500
971
227
3Q 2013
*LLS
6-3-2-1
Crack
*Sweet/
Sour Diff.
*LLS/WTI
Diff.
*LLS
Prompt
vs.
Delivered
*Market
Structure
Other
Gross
Margin
Direct
Operating
Costs
Other
3Q 2014
*Based on market indicators using actual volumes
8
Refining and Marketing Segment Income
3Q 2014 vs. 2Q 2014 Variance Analysis
1,500
1,250
1,260
$MM
1,000
(229)
20
30
24
34
(33)
(62)
(73)
971
750
500
250
0
2Q 2014
*LLS
6-3-2-1
Crack
*Sweet/
Sour Diff.
*LLS/WTI
Diff.
*LLS
Prompt
vs.
Delivered
*Market
Structure
Other
Gross
Margin
Direct
Operating
Costs
Other
3Q 2014
*Based on market indicators using actual volumes
9
Speedway Segment Income
3Q 2014 vs. 3Q 2013 Variance Analysis
160
11
140
22
$MM
120
100
(16)
102
119
80
60
40
20
0
3Q 2013
Light Product Gross
Margin
Merchandise Gross
Margin
Other
3Q 2014
10
Pipeline Transportation Segment Income
3Q 2014 vs. 3Q 2013 Variance Analysis
100
9
80
15
$MM
60
(9)
69
54
40
20
0
3Q 2013
Transportation
Revenue
Pipeline
Affiliates
Other
3Q 2014
11
Total Company Cash Flow
3Q 2014
2,608
6,000
5,000
(736)
$MM
4,000
1,010
3,000
2,000
68
2,125
(2,785)
(141)
(301)
6
1,854
Other
9/30/14
Cash
Balance
1,000
0
6/30/14
Cash
Balance
Operating
Cash Flow
before
Working
Capital
Working
Capital
Long-term
Debt, Net
Cash Capital Hess Acquisition,
Expenditures,
Net of Cash
Acquisitions,
Acquired
Investments, and
Contingent
Consideration*
Dividends
Paid
Share
Repurchases
* Excludes acquisition of Hess’ retail operations and related assets
12
Select Balance Sheet/Cash Flow Data
2014
2014
2014
2013
3Q
2Q
1Q
4Q
Cash and cash equivalents
1,854
2,125
2,166
2,292
Total debt
6,264
3,638
3,659
3,396
Equity
11,266
11,037
10,758
11,332
Debt-to-total-capital ratio
36%
25%
25%
23%
Last Twelve Months (LTM) EBITDA
5,099
4,315
3,883
4,645
Debt to LTM EBITDA
1.2x
0.8x
0.9x
0.7x
Cash provided by operations
1,078
878
766
1,355
Cash provided by operations
before changes in working capital
1,010
1,095
641
827
($MM)
As of quarter ended:
For the Quarter:
13
Focused Return of Capital to Shareholders
8,000
LTM Ended 9/30/14
7,000
6,000
2,785
Hess Retail Acquisition
$MM
5,000
Dividends and share
repurchases*
4,000
~1.2x of
Free Cash
Flow***
3,000
2,000
1,000
2,413
4,077
$2,055 Free
Cash Flow,
Excluding Hess
Acquisition***
Investments, Excluding Hess
Acquisition**
Net cash provided by
operations
2,022
0
* $512 MM dividends plus $1,901 MM share repurchases
** Includes cash capital expenditures, acquisitions, investments and contingent consideration, excluding $2.785 billion for the acquisition of Hess’ retail operations and related assets.
*** Cash flow provided by operations less cash used for investments, excluding $2.785 billion for the acquisition of Hess’ retail operations and related assets.
14
4Q 2014 Outlook
Other
Crude
Charge/
Throughput* Feedstocks
Throughput*
Total
Throughput*
Total
Percent of Turnaround Depreciation
Other
Direct
WTI-priced
and Major
and
Manufacturing
Operating
Crude
Maintenance Amortization
Cost**
Costs
4Q 2013
Projected
4Q 2014
in MBD
Gulf Coast
Region
Midwest
Region
MPC Total
Corporate
and Other
Unallocated
Items***
Refinery Direct Operating Costs****
1,000
200
1,200
6%
$2.00
$1.10
$4.60
$7.70
650
50
700
44%
$1.40
$1.75
$4.25
$7.40
1,650
200
1,850
21%
$1.85
$1.35
$4.60
$7.80
Gulf Coast
Region
Midwest
Region
943
238
1,181
5%
$1.67
$1.24
$4.44
$7.35
604
51
655
41%
$2.40
$1.82
$4.56
$8.78
MPC Total
1,547
247
1,794
19%
$1.98
$1.48
$4.59
$8.05
$85MM
$93MM
*Region throughput data includes inter-refinery transfers, but MPC totals exclude transfers
**Includes utilities, labor, routine maintenance and other operating costs
***Includes pension settlement expense ($6MM and $12MM pension settlement expense included in 4Q 2014 and 4Q 2013, respectively)
****$/barrel throughput
15
Illustrative Value of MPC Ownership in MPLX*
Illustrative Value of MPC Ownership
based on 2019E Distributions**
Total Distributions to MPC
600
500
389
300
267
15
10
187
200
16.0
GP Distributions
$B
$MM
20.4
20
400
124
100
24.8
25
557
LP Distributions
CAGR 25%
82
2014E
2015E
2016E
2017E
2018E
2019E
5
0
-
MPLX Value per
MPC Share
GP
@ 35x
LP
@ 20x
1
$41.26
$56.93
GP
@ 45x
LP
@ 25x
2
$56.93
$72.62
GP
@ 55x
LP
@ 30x
3
$72.62
$88.29
*Represents cash distributions applicable to the period in which the distributions were earned. GP distributions include incentive distribution rights.
**Graph shows estimated valuations for MPC’s LP and GP interests in MPLX. See MPLX LP and GP Illustrative Valuation slide in appendix for underlying assumptions.
16
Appendix
MPLX LP and GP Illustrative Valuation
MPC Distributions & Asset Sales Proceeds from MPLX ($MM)
GP Distributions, including IDRs
3Q 2013 YTD
1
3Q 2014 YTD
3
LP Distributions
40
53
Total Cash Distribution Received from MPLX
Asset Sales Proceeds from MPLX
41
100
56
310
Illustrative MPLX Value to MPC*
Multiple of LP distributions
LP Valuation ($MM)
20x
2014
25x
30x
20x
2019
25x
30x
$1,523
$1,904
$2,285
$4,644
$5,805
$6,966
Multiple of GP distributions
35x
45x
55x
35x
45x
55x
GP Valuation ($MM)
$202
$260
$318
$11,355
$14,600
$17,844
MPLX Value to MPC ($MM)
$1,725
$2,164
$2,603
$15,999
$20,405
$24,810
MPLX Value per MPC Share
$6.14
$7.70
$9.26
$56.93
$72.62
$88.29
Value Assumptions
- Used 25% for mid-20% Distribution Growth
- MPC maintains 54MM LP units, 2% GP Interest
- Acquired EBITDA financed 50/50 Debt/Equity
- MPC shares outstanding as of 9/30/2014
*Represents cash distributions applicable to the period in which the distributions were earned.
18
MPC’s Currently Identified Eligible MLP EBITDA
Sources of ~ $1.7 B
NewNew
Pipelines
Retained by MPC
 ~ 5,400 miles of additional crude and products pipelines
– Owns, leases or has an ownership interest in these pipelines
– 31% of MPLX Pipe Line Holdings LP
 Southern Access Extension, Sandpiper and Utica investments
Marine
 200 owned and 12 leased inland barges; 5.3 MMBBL capacity
 17 owned and one leased inland towboats
Terminals
 63 light product; ~ 23 MMBBL storage; 192 loading lanes
 18 asphalt; ~ 4 MMBBL storage; 65 loading lanes
Railcars
 27 owned and 2,138 leased
 763 general service; 1,166 high pressure; 236 open-top hoppers
Refineries
 59 MMBBL storage (tanks and caverns)
 25 rail loading racks and 24 truck loading racks
 7 owned and 11 non-owned docks
 2 condensate splitter investments
Fuels
Distribution
 20 B gallons of fuels distribution volume
– Existing MPC and Speedway volumes; ~ 17 B gallons refined products
– Acquisition of Hess’ retail operations adds ~ 3 B gallons refined products
19
Capital Expenditures & Investments*
($MM)
2014 Budget
3Q 2014
2014 YTD
Refining & Marketing (R&M)
864
151
445
Midstream included in R&M
348
113
232
Speedway
327
77
153
Pipeline Transportation
760
224
418
Corporate and Other
133
22
60
2,432
587
1,308
38
7
20
2,470
594
1,328
Subtotal
Capitalized Interest
Total Capital Expenditures &
Investments
* Excludes capital expenditures and investments attributable to the acquisition of $2.68B for Hess’ retail operations and related assets.
20
MPLX Adjusted EBITDA Reconciliation from Net Income
($MM)
Net income
Less: Net income attributable to MPCretained interest
Net income attributable to MPLX LP
Plus: Net income attributable to MPCretained interest
Depreciation
Provision for income taxes
Non-cash equity-based compensation
Net interest and other financial costs
Adjusted EBITDA
Less: Adjusted EBITDA attributable to MPCretained interest
Adjusted EBITDA attributable to MPLX LP
3Q 2014
Dec. 2015
Annualized Annualized
146
172
304
2013
68
56
-
78
116
304
68
49
1
1
197
56
50
2
4
228
71
4
71
450
86
68
-
111
160
450
21
Reconciliation
Free Cash Flow to Net Cash Provided by Operations
2013
($MM)
(For the Quarter)
2014
4Q
1Q
2Q
3Q
Net cash provided by operating activities
1,355
766
878
1,078
Additions to property, plant and equipment
(473)
(267)
(302)
(383)
Acquisitions*
-
-
(42)
(4)
Investments
(38)
(123)
(41)
(177)
-
-
-
(172)
844
376
493
342
Contingent Consideration
Free cash flow
Last twelve months free cash flow
2,055
*Represents cash paid, excludes acquisition of Hess’ retail operations and related assets.
22
Earnings
($MM unless otherwise noted)
2013
2014
1Q
2Q
3Q
4Q
1Q
2Q
3Q
1,105
903
227
971
362
1,260
971
Speedway segment income
67
123
102
83
58
94
119
Pipeline Transportation segment income
51
58
54
47
72
81
69
(67)
(64)
(59)
(81)
(67)
(61)
(76)
-
(60)
(23)
(12)
(64)
(5)
(21)
1,156
960
301
1,008
361
1,369
1,062
(48)
(45)
(47)
(39)
(46)
(48)
(50)
1,108
915
254
969
315
1,321
1,012
Income tax provision
378
316
81
338
108
457
333
Net income
730
599
173
631
207
864
679
5
6
5
5
8
9
7
Net income attributable to MPC
725
593
168
626
199
855
672
Effective tax rate
34%
35%
32%
35%
34%
35%
33%
Refining & Marketing segment income
Corporate and other unallocated items
Pension settlement expenses
Income from operations
Net interest and other financing income (costs)
Income before income taxes
Less net income attributable to noncontrolling
interests
23
Reconciliation
EBITDA to Net Income Attributable to MPC
($MM)
2013
2014
1Q
2Q
3Q
4Q
1Q
2Q
3Q
Net Income attributable to MPC
725
593
168
626
199
855
672
Less: Net interest and other financial
income (costs)
(48)
(45)
(47)
(39)
(46)
(48)
(50)
Add: Net income attributable to
noncontrolling interests
5
6
5
5
8
9
7
Add: Provision for income taxes
378
316
81
338
108
457
333
Add: Depreciation and amortization
287
302
299
332
320
325
322
1,443
1,262
600
1,340
681
1,694
1,384
4,645
3,883
4,315
5,099
EBITDA
Last Twelve Months EBITDA
24
Cash Provided from Operations Before Changes in Working
Capital Reconciliation to Net Cash Provided by Operations
($MM)
2013
2014
4Q
1Q
2Q
3Q
1,355
766
878
1,078
34
139
(300)
585
Changes in inventories
1,025
(1,000)
77
192
Changes in current accounts payable and accrued liabilities
(564)
1,011
(17)
(676)
33
(25)
23
(33)
528
125
(217)
68
827
641
1,095
1,010
(For the Quarter)
Net cash provided by operations
Less changes in working capital:
Changes in current receivables
Changes in the fair value of derivative instruments
Total changes in working capital
Cash provided from operations before changes in working capital
25
Refining & Marketing Indicative Gross Margin – 3Q 2014
3,000
501
2,500
$MM
2,000
1,500
95
546
2,516
19
(150)
1,505
(1,245)
1,000
(300)
971
500
0
*LLS
6-3-2-1
Crack
*Sweet/
Sour Diff.
*LLS/WTI
*LLS
*Market
Diff.
Prompt vs. Structure
Delivered
Other
Gross
Margin
R&M
Gross
Margin
Direct
Operating
Costs
Other
R&M
Segment
Income
*Based on market indicators using actual volumes
26