Good day, ladies and gentlemen, and welcome to the Q4 2017 Calumet Specialty Products Partners Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference may be recorded. I would now like to introduce your host for today's conference, Joe Caminiti, you may begin.

Thank you, Brenda. Good morning, everyone and thank you for joining us today for our fourth quarter and year-end earnings results call. With us on today's call are Tim Go, CEO; West Griffin, CFO; Bill Anderson, EVP of Specialties, Integration and Marketing; and Bruce Fleming, EVP of Strategy and Growth. Before we proceed, allow me to remind everyone that during the course of this call, we may provide various forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Such statements are based on the beliefs of our management as well as the assumptions made by them and, in each case, based on the information currently available to them. Although our management believes that the expectations reflected in such forward-looking statements are reasonable, neither the partnership, it's general partner nor management can provide any assurance that these expectations will prove to be correct. Please refer to the partnership's press release that was issued this morning, as well as the latest findings with the Securities and Exchange Commission for a list of factors that may affect our actual results and could cause them to differ from our forward-looking statements made on this call. As a reminder, you may now download of a PDF of the presentation slides that will accompany the remarks made on today's conference call, as indicated in the press release we issued earlier today. You may access these slides in the Investor Relations section of our website at calumetspecialty.com. Also, a webcast replay of this call will also be available on our site within few hours and you can contact the Alpha IR Group for Investor Relations support at 312-445-2870. With that, I'd like to pass the call to Tim Go. Tim?

Thanks, Joe. Good morning everyone and thank you for joining us. I am pleased to report that we have successfully turned the corner. We generated our fifth straight quarter of trailing 12-month adjusted EBITDA growth. We called our high-interest senior secured notes today which officially closes the door on what has been one of the toughest periods in our Company's history. And last week, we extended our corporate revolver for a new five-year term, which reflects the confidence on our bankers pass [ph] and the positive steps we have taken to improve the partnership's operational and financial performance. Please turn to Slide 3; as we look back over our last two years, we have come a long way. We first reset the vision of the Company in early 2016 at a time when our head markets were extremely challenged. That new vision allowed us to reach at our culture due to the addition of new experienced leadership and through a stronger executional focus across the organization. As a result, we delivered five straight quarters of trailing 12-months adjusted EBITDA growth and completed the divestiture of two of our non-core assets that will provide over $600 million in proceeds. We had a significantly improved balance sheet that has opened up several strategic options to the Company that were not available when we first outlined our new vision. One of those options we've announced today is the call of our 11.5% senior secured notes; this process will take about a month to complete but when it's accomplished, we will reduce our annual interest expense by $46 million per year. In 2017, we got back to doing what Calumet does best; creating quality premium specialty products. In fact, we have several records within our specialty product segment last year, including record annual throughput…

Thanks. Tim. You can see the improving year-over-year performance across each of our segments that Tim discussed on Slide 8. In terms of our Anchor business or our prior Oilfield Services segment, you will now find it's a discontinued operations within our press release and financial filings as we officially sold the business on November 21. Our specialty segment provides stable adjusted EBITDA margins on a trailing 12-month basis as shown on Slide 9. On a quarter-to-quarter basis, there are variations in our margins driven by seasonal effects as well as changes in crude prices, but overall, we tend to have stable margins over trailing 12-month basis that range around 15%. That consistency and reduced volatility will provide for a much more stable operating environment as we move forward as we'll have less exposure to the cyclical fuels in oilfield services side of the historical business. That stability of our trailing 12-months specialty adjusted EBITDA margin shows you that overtime we're able to adjust our pricing fairly effectively. We believe that is important to start talking more like a specialty chemicals company moving forward and thus you will see this review from us going forward. Strong margins and healthier operating environments across all three of the business contributed positively to our growth over the last fourth quarter as shown on Slide 10. This was further supported by $10 million in Self-Help as Tim mentioned, as well as the net $8.7 million favorable impact from LCM and LIFO impacts. Offsets to these positive contributions include $37.1 million in higher operating costs which reflects the fact that we got twins [ph] hardship exemptions in the fourth quarter last year, that did not repeat this fourth quarter. Those winds exemptions related to the calendar year 2015 as a reminder. Volumes were lower and…

Thanks, West. I'd like to take a few minutes to talk through our priorities for 2018. And I think it's important to start in our ongoing commitment to our Self-Help program. Turning to Slide 16, we originally set a program goal of $150 million to $200 million by 2018 and we've already achieved a $143 million of that. 2017 saw nice contributions from work that was completed at Shreveport to improve our profitability capture at that plant. As we look to 2018, we are setting a goal of $40 million to $50 million for the year which will drive us towards the top end of the 3-year goal. This will continue to be driven by cost discipline, margins enhancements and opportunistic growth projects. This includes two new projects that will drive results in 2018 and UI summer unit as our San Antonio facility to increase our high octane gasoline fares and a naphtha project at the Great Falls plant that will improve the quality and market price of our naphtha. The main takeaway for our investors is continuous improvement will remain a part of our culture. We expect to provide you with a new long-term goal beyond 2018 down the road as we believe there is a lot more we can do to become a truly high performing organization. Finally, I'd like to announce the launch of our new Product Innovation Center here in Indianapolis. Turn to Slide 17; we have our grand opening for the center in October and it's a highly advanced state-of-the-art R&D facility which has already helped us develop new products like our Group III Synthetic Base Oil and our Transformer Oil. One of the keys to our success has been the ability to develop the products and formulations for our customers to solve their specific…

[Operator Instructions] And our first question comes from the line of Mike Gyure from Janney. Your line is now open.

Can you talk maybe a little bit about specifically in the fourth quarter, some of the barrels per day volumes coming out of the specialty lubes was down significantly year-over-year. Can you talk about, I guess sort of the e-impacts; I think a lot of that was probably due some of the hurricane related stuff that sort of rolled from the third quarter to fourth quarter, I think such kind of volumes and some of the throughput that went on in the fourth quarter there?

Yes, the fourth quarter showed lower specialty volumes, some of that was associated with some of the supply chain disruptions that we talked about but primarily we had loops hydro finder [ph] downtime at Shreveport that resulted in lower sales, that was really the main driver for that. You will see the branded products division through the press release numbers were actually back to normal levels and really our -- we view our business as continuing to be strong, recovering further the supply chain disruptions that we had and we see 2018 to be continued strength in our specialized business. We're also mentioning and we said this in our prepared remarks, we also had a Shreveport unit down in the first quarter which will also unpack [ph] volumes in the first quarter for our specialties business. But as we've talked about over the last few years, we've been trying to spread out our turnarounds so that that they don't concentrate in a particular quarter on a particular year, and so we've done pretty good job of doing that here over the last year to try to make sure that we don't hit the books all in one quarter. So Mike, hopefully that will give you a little better feel for what's going on.

And then maybe one more on the -- the specialty products looks like part of the impairment charge, about $60 million of that was in the specialty products business. Can you talk about I guess what you impaired there if it's specific facilities or specific assets? Just one more color there would be appreciated.

Yes, so with respect to the impairments, Calumet went on an acquisition spree and CapEx spree a number of years ago and during that time it was a relatively high price margin environment and so we do a regular review of all of our assets every year and it's really -- kind of this time of the year that we do it, it's in the fourth quarter and so as a consequence of that there were several facilities that -- where we took impairments and so some of them were in specialties, some was elsewhere.

And our next question comes from the line of David [ph] from Seaport. Your line is now open.

A couple of questions. First is, with only two segments excluding the discontinued operations, I'm having a -- I've had a hard time allocating the ERP cost of $12.7 million between the two segments, can you help me there please?

Yes, I wouldn't bother really trying to because in ERP system is accrually an integrated system and so it's -- it is all sort of one big ball of wax there.

I mean, what I'm trying to do is focus on the specialty product segments and if the $194 million or $195 million on a reported basis if -- I'm just trying to see if I should get that closer to $200 million or $205 million or $210 million since that's really going to be the significant portion of the Company going forward. On liquidity, the $252 million of revolver availability that you talk about at $231 million, can you provide a number pro forma for the new revolver? Is it the same or does it change materially?

At the end of the fourth quarter, so at the end of December we didn't have Superior or Anchor and so what you have there is with it was or what it is. So that is -- that's the actual as pro forma.

And then on the cash flow statement, I see $100 million or $100.1 million of proceeds from inventory financing agreements. Can you talk about what that is and whether that created the liability somewhere else in the balance sheet?

Yes, so the inventory finance, we did that -- I think it was in the second and third quarters at the year. We have an inventory finance arrangement with Macquarie where they take ownership of barrels at the refinery, both crude as well as refined product; we treat this as an on balance sheet obligation but they actually technically own title to it but that's what that is and it's a relatively attractive piece of financing.

I apologize. I thought that was a fourth quarter, then I must have missed it previously. Then my final question is, it pertains to the capital structure. So after the call you won't have any drawn or any material drawn secured debt, you will have unsecured -- you will capacity obviously because of the revolver or the ability because of the revolver. You will have some unsecured bonds, some of which are currently callable with 7 handle coupons, 6 and 7 handle coupons. Is there any thought about further -- and you won't have any prepayable debt or pre-debt is easily pre-payable without penalty. Is there any thoughts about further optimizations of the capital structure in say the next 6 months or during 2018?

I mean, we're always working to optimize things. One of the things that we also released information this morning and mentioned that we had extended the corporate revolver and one of the things we did associated with that was to -- in additional small piece of tranche associated with it because it's a little more liquidity, about $25 million more liquidity associated with it, as well as some other benefits but we're always looking at our capital structure, we have $900 million after we recall the secured notes, we've got $900 million of unsecured debts due 2021. We like the interest coupon there, it's very attractive, there is nothing that requires us to do anything there but we have looked at and we'll continue to look at potentially at some stage bringing out what is the right time to refinance the portion of that and relater the debt structure through a new issuance. But again, that's simply an issue of optimization and figuring out what's the right time and position to do that. We think that we're making huge progress in terms of our debt reduction and improving our metrics, things are going in the right direction and so we're not necessarily in a hurry to kind of do anything there.

Thank you. And that concludes our question-and-answer session for today. I'd like to turn the call back over to Tim Go for closing remarks.

Thank you, Brenda. Thank you for your time today and your continued support. We look forward to seeing many of you at the investor conferences we have coming up over the next few months. I also like to thank our Board, our management team and all of our employees for their hard work and support over the last two years as everyone is critical for us.

Ladies and gentlemen, thank you for your participation in today's conference. This concludes the program and you may now disconnect. Everyone have a great day.