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Wednesday, January 31, 2018

-=Andeavor (ANDV) : Q4 update

Andeavor provides Q4 update and tax reform impact on longer term estimates 
  • Co expects to report fourth quarter net earnings of ~$5.55 to $5.65 per diluted share (may not compare to $1.24 consensus). Q4 results include ~$920 mln of benefit related to re- measurement of net deferred tax liabilities due to the recently enacted Federal Tax Cuts and Jobs Act. Furthermore, Andeavor estimates that compared to the 2018-2020 outlook provided at the Investor and Analyst Day on December 5, 2017, Federal tax-reform legislation will result in additional cumulative cash flow from operations of ~$1.0 to $1.5 bln through 2020.
  • Expect fuel margins in Marketing segment of ~13 cents per gallon during the quarter. Segment operating income and segment EBITDA are expected to be ~$235 to $240 mln and $255 to $260 mln, respectively.
  • Logistics segment operating income and segment EBITDA are expected to be ~$190 to $195 mln and $265 to $270 mln, respectively. These results include ~$10 mln of transaction costs related to the merger between Andeavor Logistics (ANDX) and Western Refining Logistics (WNRL) and the IDR Buy-In. Refining segment operating loss is expected to be $50 to $55 mln and segment EBITDA is expected to be ~$120 to $125 mln. Refining throughput was at the high end of guidance; however, this was partially offset by product yields and maintenance costs due to unplanned conversion unit downtime resulting in an approximately $25 million negative impact in the fourth quarter.
  • These preliminary results also include Western Refining integration charges of ~ $25 mln which is consistent with previous guidance related to corporate expense. The Company also expects to report the following items not previously included in its fourth quarter guidance: ~$80 mln of costs related to Andeavor Logistics' inaugural investment grade offerings to refinance existing debt and $40 mln of asset impairment charges related to the Vancouver Energy project primarily as a result of the state of Washington's Energy Facility Site Evaluation Council's decision not to support development of the project.

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