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Delek Logistics Partners, LP (NYSE: DKL), based in Brentwood, Tennessee, is a dynamic publicly traded master limited partnership (MLP) established by Delek US Holdings in 2012. The company specializes in the ownership, operation, acquisition, and construction of crude oil and refined products logistics and marketing assets. A significant portion of their assets are crucial for supporting the refining operations of Delek's facilities in Tyler, Texas, and El Dorado, Arkansas.
Delek Logistics operates through several segments including Pipelines and Transportation, as well as Investments in Pipeline Joint Ventures. Their services encompass gathering, transporting, and storing crude oil, along with marketing, distributing, and storing refined products. These operations primarily serve Delek's refineries and also cater to third-party customers in the southeastern United States and West Texas.
The Pipelines and Transportation segment is the cornerstone of Delek Logistics' business, featuring pipelines, tanks, offloading facilities, and trucks that facilitate the movement and storage of crude oil and refined products. This segment is responsible for the majority of the company's revenue, showcasing their extensive infrastructure.
Recent achievements highlight Delek Logistics' proactive approach in financial management and expansion. On March 7, 2024, the company announced a public offering of $120 million in common units, with an additional option for underwriters to purchase $13.5 million more. This initiative aims to repay outstanding borrowings under its revolving credit agreement, showcasing their commitment to financial health.
In another significant move, Delek Logistics revealed the pricing of a public offering of 3,116,884 common units at $38.50 per unit on March 7, 2024. The net proceeds are intended to further strengthen their financial standing by reducing debt. Additionally, a tender offer for 6.75% Senior Notes due in 2025, announced on March 11, 2024, further emphasizes their strategic financial maneuvers.
Delek Logistics’ extensive network and joint ventures, particularly in the Permian and Delaware Basins, underline their pivotal role in the midstream energy sector. They provide a range of services including crude oil gathering, transportation, and storage, as well as wholesale marketing and terminalling, which are integral to their operations and growth strategy.
The strong backing from Delek Holdings, which owns the general partner interest and a majority limited partner interest, coupled with their significant customer relationship, adds to Delek Logistics' stability and growth potential. Investors can stay updated with the latest developments and financial performance through their investor relations webpage and news releases.
Delek US Holdings reported a net loss of $(88.1) million or $(1.20) per share for Q3 2020, compared to a net income of $51.3 million or $0.68 per share a year earlier. Adjusted EBITDA fell to $21.9 million from $184.2 million. Key actions to improve cash flow include an 8% workforce reduction and 40% CAPEX cut, projected to enhance cash flow by $200 million in 2021. The company suspended dividends to maintain financial flexibility. As of September 30, 2020, cash was $808 million, with $2.47 billion debt. Refining margins plummeted, while logistics saw improved contributions.
Delek Logistics Partners reported a strong performance for Q3 2020, with net income of $46.3 million ($1.26 per unit), up 52% year-over-year. Net cash from operations was $62.3 million, while distributable cash flow reached $59.1 million. EBITDA increased by 32% to $67.8 million, driven by the drop down of new assets and reduced operating expenses. The company declared a cash distribution of $0.905 per unit, reflecting a 2.8% increase from Q3 2019. Total debt stood at approximately $1 billion with a leverage ratio of 3.9x, demonstrating financial stability and growth potential.
Delek Logistics Partners, LP (NYSE: DKL) announced a quarterly cash distribution of $0.905 per common limited partner unit for Q3 2020, reflecting a 0.6% increase from Q2 2020 and a 2.8% increase year-over-year. This marks the 30th consecutive quarterly increase in distributions, demonstrating business stability amid challenging energy conditions. The distribution is payable on November 12, 2020 to unitholders of record on November 6, 2020. Delek Logistics aims for 5% distribution growth for the year compared to 2019.
Delek US Holdings (NYSE: DK) will issue its third quarter 2020 results on November 4, 2020, after market close. A conference call to discuss these results is scheduled for 8:30 a.m. CT on November 5, 2020. Investors can access the live broadcast through the Delek US website. Additionally, Delek Logistics Partners (NYSE: DKL) will hold its own earnings call at 7:30 a.m. CT on the same day, which may offer relevant information for Delek US stakeholders.
Delek Logistics Partners, LP (NYSE: DKL) announced it will release its third-quarter 2020 results after market close on November 4, 2020. A conference call is scheduled for November 5, 2020, at 7:30 a.m. CT to discuss the results. Investors can access the live call on its website, with a replay available for 90 days. Additionally, Delek US Holdings, Inc. (NYSE: DK) will also hold its own earnings call on the same day at 8:30 a.m. CT. The logistics partnership focuses on owning and operating midstream energy infrastructure.
On August 13, 2020, Delek US Holdings and Delek Logistics Partners announced the elimination of all incentive distribution rights (IDRs) in Delek Logistics. In return, Delek US will receive 14 million newly issued DKL common limited partner units and $45 million in cash. This transaction is projected to enhance distributable cash flow per DKL unit and increases Delek US's ownership stake in DKL to approximately 80%. The Conflicts Committee of Delek Logistics approved the transaction, which aims to reduce the cost of capital and support the midstream growth strategy of Delek Logistics.
Delek US reported second quarter 2020 financial results, showing a net income of $87.7 million or $1.18 per diluted share, up from $77.3 million or $1.00 per diluted share year-over-year. However, adjusted net loss reached $110.5 million, reflecting significant losses from inventory impacts and hedging. The refining segment faced a decline in contribution margin to $59.7 million from $198.1 million, largely due to lower demand amid COVID-19. The company declared a quarterly dividend of $0.31 per share and reported a cash balance of $849 million as of June 30, 2020.
Delek Logistics Partners reported a net income of $44.4 million for Q2 2020, significantly up from $24.9 million in Q2 2019. EBITDA increased to $64.8 million, reflecting a 45% year-over-year rise. The decline in revenue to $117.6 million was primarily due to lower commodity prices. However, distributable cash flow surged to $57.0 million, a 82% increase compared to the previous year. A quarterly cash distribution of $0.90 per common limited partner unit was declared, marking a 5.9% increase from last year. The leverage ratio remains below 4.1x, indicating strong financial health.
Delek Logistics Partners (NYSE: DKL) will announce its second quarter 2020 results on August 4, 2020, after market close. A conference call is set for August 5, 2020, at 7:30 a.m. CT to discuss the results. Investors can access the live broadcast on the company's website, with replays available for 90 days. Additionally, Delek US Holdings (NYSE: DK) will hold its second quarter earnings call at 8:30 a.m. CT on the same day, which may also provide insights relevant to Delek Logistics. The partnership focuses on midstream energy infrastructure.
Delek Logistics Partners reported a net income of $27.8 million for Q1 2020, marking a 41% increase year-over-year. EBITDA surged by 23.5% to $48.7 million, driven by contributions from various assets despite lower gross margins in West Texas. The company declared a distribution of $0.890 per unit, an 8.5% increase from Q1 2019, reiterating a 5% distribution growth target for the year. Capital spending has been reduced from $22.7 million to $17.6 million, enhancing financial flexibility.
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