Delek US(US:DK)2022-02-24 18:44Financial Data and Key Metrics Changes - For Q4 2021, Delek US reported an adjusted net loss of $44.9 million, or a loss of $0.61 per share, compared to a net loss of $204 million, or a loss of $2.77 per share in the prior year period [7] - Adjusted EBITDA for Q4 2021 was $58.2 million, a significant improvement from a loss of $137.6 million in the prior year period [7] - The company had a positive cash flow of approximately $161 million from continuing operations in Q4 2021, which included a working capital benefit of $110 million [8] Business Line Data and Key Metrics Changes - Total refining system crude oil throughput for Q4 2021 was approximately 279,000 barrels per day, with expectations for Q1 2022 to average between 275,000 and 285,000 barrels per day [12] - Capital expenditures during Q4 2021 were $66 million, reflecting maintenance at the Tyler refinery and initial growth spending on the Permian gathering business [13] Market Data and Key Metrics Changes - The company ended Q4 2021 with $857 million in cash and $1.36 billion in net debt [10] - The first quarter operating costs are forecasted to be in the range of $160 million to $170 million, influenced by elevated natural gas prices [11] Company Strategy and Development Direction - The company is optimistic about increasing activity levels in the Permian Basin and sees opportunities for organic growth in existing assets [15] - A partial divestiture program of DKL units has been successful, creating options for future sales [16] - The company aims for a 34% reduction in Scope one and two carbon emissions by 2030 as part of its ESG efforts [17] Management's Comments on Operating Environment and Future Outlook - Management noted that the macro backdrop is improving, and the lack of major turnaround activities in 2022 positions the company well to capture margin opportunities [15] - There is a strong expectation for demand recovery across various products, including gasoline, distillate, and jet fuel, as the pandemic subsides [44] Other Important Information - The company is exploring options for feedstock optionality to improve the economics of its biodiesel plants [68] - The Wink to Webster project is in a ramp-up phase, with expectations for full utilization by the end of 2023 [33][52] Q&A Session Summary Question: Delek's leverage to positive crude prices - Management acknowledged that higher crude prices would positively impact the company, particularly in terms of gathering volumes and differentials [18][22] Question: Capital allocation priorities - Management indicated that they do not have major turnarounds planned for 2022 and are focused on growth spending, with a careful approach to capital returns [28][32] Question: Impact of asphalt prices on refining profits - Management noted strong asphalt prices but emphasized the seasonal nature of the business, expecting robust prices as they move into the paving and roofing season [65] Question: Biodiesel plant conversion - Management clarified that they are not currently exploring converting biodiesel plants into pretreatment facilities but are looking at feedstock options [70]