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Delek Q3 Loss Narrower Than Expected, Revenues Lag Estimates
DKDelek US(DK) ZACKS·2024-11-15 14:06

Core Insights - Delek US Holdings, Inc. reported a third-quarter 2024 adjusted net loss of 1.45pershare,whichwasnarrowerthantheZacksConsensusEstimateofalossof1.45 per share, which was narrower than the Zacks Consensus Estimate of a loss of 1.71, but a decline from a profit of 2.02pershareinthesamequarterlastyearduetoweakcontributionsfromtheRefiningsegment[1][4]−Netrevenuesdecreasedby35.92.02 per share in the same quarter last year due to weak contributions from the Refining segment [1][4] - Net revenues decreased by 35.9% year over year to 3 billion, missing the Zacks Consensus Estimate by 48million[1]−AdjustedEBITDAforthequarterwas48 million [1] - Adjusted EBITDA for the quarter was 70.6 million, down from 345.1millionintheyear−agoperiod[2]FinancialPerformance−Totaloperatingexpensesdecreasedbyapproximately29.6345.1 million in the year-ago period [2] Financial Performance - Total operating expenses decreased by approximately 29.6% year over year to 3.1 billion, with capital expenditures of 128.5millionduringthesameperiod[7]−Thecompanyhadcashandcashequivalentsof128.5 million during the same period [7] - The company had cash and cash equivalents of 1 billion and long-term debt of 2.8billionasofSeptember30,2024,resultinginadebttototalcapitalratioofabout76.12.8 billion as of September 30, 2024, resulting in a debt to total capital ratio of about 76.1% [7] Segment Performance - Refining segment's adjusted EBITDA was 10.2 million, a significant decline from 296.1millionintheprior−yearquarter,attributedtolowerrefiningcrackspreadswhichfellbyanaverageof49.1296.1 million in the prior-year quarter, attributed to lower refining crack spreads which fell by an average of 49.1% [4] - Logistics segment reported an adjusted EBITDA of 106.1 million, an increase from 96.5millionintheyear−agoquarter,drivenbycontributionsfromDelawareGatheringsystemsandtheWinktoWebsterpipelinedropdown[6]DividendsandGuidance−Theboardapprovedaregularquarterlydividendof25.5centspershare,payableonNovember18,2024,toshareholdersofrecordasofNovember12[2]−For2024,thecompanyexpectscapitalexpendituresof96.5 million in the year-ago quarter, driven by contributions from Delaware Gathering systems and the Wink to Webster pipeline dropdown [6] Dividends and Guidance - The board approved a regular quarterly dividend of 25.5 cents per share, payable on November 18, 2024, to shareholders of record as of November 12 [2] - For 2024, the company expects capital expenditures of 330 million, with specific allocations for Refining, Logistics, Discontinued Operations, and Corporate & Other [15] Key Transactions - Delek Logistics completed the acquisition of H2O Midstream for 229.5million,whichincludeswaterdisposalandrecyclingoperationsintheMidlandBasinofTexas[8][9]−Thecompanyfinalizedthesaleofitsretailoperationsforapproximately229.5 million, which includes water disposal and recycling operations in the Midland Basin of Texas [8][9] - The company finalized the sale of its retail operations for approximately 390.2 million in net cash proceeds before taxes, recognizing a pretax gain of $98.4 million from the transaction [10][11]