Delek US Holdings, Inc. (NYSE: DK) (“Delek US”) today announced
financial results for its second quarter ended June 30, 2019.
Delek US reported second quarter 2019 net income of $77.3 million,
or $1.00 per diluted share, versus a net income of $79.1 million,
or $0.89 per diluted share, for the quarter ended June 30,
2018. On an adjusted basis, Delek US reported adjusted net
income of $90.6 million, or $1.17 per diluted share for the second
quarter 2019. This compares to adjusted net income of $78.9
million, or $0.92 per diluted share, in the prior-year period.
Adjusted earnings before interest, taxes, depreciation and
amortization ("Adjusted EBITDA") was $204.9 million compared to
Adjusted EBITDA of $186.1 million in the prior-year period.
Reconciliations of net income reported under U.S. GAAP to adjusted
net income and Adjusted EBITDA are included in the financial tables
attached to this release.
Adjusted quarterly results increased
year-over-year driven by higher crack spreads, continued commercial
execution, a shift in the crude curve from backwardation to
contango and lower RINs expenses. In addition, the new alkylation
unit at the Krotz Springs, Louisiana refinery contributed
approximately $15.0 million of contribution margin during the
second quarter 2019. These were partially offset by a lower crude
differential environment where the realized Midland to Cushing
differential declined from $3.00/bbl in the second quarter 2018 to
$1.77/bbl in the second quarter of 2019.
Uzi Yemin, Chairman, President and Chief
Executive Officer of Delek US, stated, "Despite a compressing
Midland differential in the quarter, we were able to deliver strong
financial performance, demonstrating the resilience of our
portfolio. This builds on stellar first quarter results leading to
a solid overall performance in the first half of 2019. Our system
is increasingly benefiting from commercial initiatives along with
the contribution from new projects, including the Red River joint
venture in the midstream and the completion of the alkylation unit
at the Krotz Springs refinery. While growth objectives are
underway, we remain committed to returning cash to shareholders.
Our quarterly dividend is being increased by 3.6 percent, marking
the fifth increase since the first quarter of 2018. We have
continued to repurchase shares, which was a factor that has
resulted in our weighted average share count in the second quarter
2019 being 14 percent below the peak in the second quarter 2018.
For the third quarter 2019, we expect to repurchase $40 million of
common stock."
Mr. Yemin continued, "We remain focused on
developing our midstream portfolio. We have patiently
evaluated long haul pipeline options and are pleased to join a
strong set of partners in the Wink to Webster Pipeline LLC joint
venture. This asset offers attractive return potential and it
further integrates our portfolio by allowing us to offer additional
services to producers in our gathering system. Separately, Delek
Logistics' participation in the Red River pipeline joint venture
complements our existing geographic footprint, increases
optionality throughout our system and provides a more stable cash
flow stream in the future. Finally, the Big Spring Gathering System
continues to develop, where we now have over 250,000 dedicated
acres. The combination of these projects supports our target to
achieve $370 to $395 million of annualized EBITDA from our
midstream operations by 2023."
Wink to Webster Long-Haul Pipeline Joint
VentureDelek US has entered into a definitive agreement to
acquire a 15 percent ownership interest in Wink to Webster Pipeline
LLC (the "Joint Venture"). The expected net investment in the Joint
Venture will be in the range of $340 to $380 million. The project
is underpinned by a significant volume of long term commitments and
is expected to be completed in the first half of 2021. The
anticipated return on the pipeline investment is expected to be
well above our internal hurdle rate of 15 percent for discretionary
logistics projects. In addition, Delek US should benefit from
additional commercial opportunities created by a growing midstream
platform.
From a financing perspective, our flexible balance sheet affords
us the opportunity to explore multiple options including project
financing or utilizing and/or expanding our existing credit
facilities. We expect to use at least 75% financing to fund the
investment and preserve cash on the balance sheet.
Red River Joint VentureAs
previously announced in May 2019, Delek US' logistics arm, Delek
Logistics Partners, LP ("Delek Logistics") entered into a new joint
venture by purchasing a 33 percent ownership interest in the Red
River crude oil pipeline from Plains Pipeline, L.P. for
approximately $128.0 million, which includes an initial payment of
$3.5 million for the expansion of the pipeline. This pipeline has a
current capacity of 150,000 barrels per day and is being expanded
to 235,000 barrels per day by the first half of 2020. Delek
Logistics will contribute approximately $20.0 million toward the
expansion. Upon completion of the expansion, Delek US will increase
its throughput from 35,000 barrels per day to 100,000 barrels per
day. This incremental 65,000 barrels per day increases optionality
to displace Midland crude in the event that Cushing barrels are
more economically attractive. Alternatively, by utilizing Delek
Logistic's Paline Pipeline and third-party systems these barrels
may access the Gulf Coast markets to capture the arbitrage from
Cushing.
Regular Quarterly Dividend and Share
RepurchaseDelek US announced today its Board of Directors
declared a regular quarterly cash dividend of $0.29 per share. This
represents a 3.6 percent increase from our previous regular
quarterly dividend. Shareholders of record on August 19, 2019
will receive this cash dividend payable on September 3,
2019.
Based on settlement dates during the second
quarter 2019, Delek US repurchased approximately 1.6 million shares
of Delek US common stock for approximately $58.6 million, with an
average price of $35.60 per share. On a year to date basis, Delek
US repurchased approximately 2.9 million shares for approximately
$104.8 million with an average price of $35.66 per share. At
June 30, 2019, there was approximately $304.9 million of total
available authorization remaining to repurchase shares. Delek US
expects additional repurchases of approximately $40.0 million of
Delek US common stock during the third quarter 2019.
LiquidityAs of June 30,
2019, Delek US had a cash balance of $951.4 million and total
consolidated debt of $1,916.7 million, resulting in net debt of
$965.3 million. As of June 30, 2019, Delek Logistics had
$840.9 million of total debt and $5.4 million of cash, which is
included in the consolidated amounts on Delek US' balance sheet.
Excluding Delek Logistics, Delek US had approximately $946.0
million in cash and $1,075.8 million of debt, or a $129.8 million
net debt position.
Refining SegmentRefining
segment contribution margin was $178.3 million in the second
quarter 2019 compared to $177.0 million in the second quarter 2018.
On a year-over-year basis, results benefited from higher crack
spreads, lower RINs expense, crude shift to contango and the
addition of the alkylation unit at the Krotz Springs refinery.
Serving as an offset were lower Midland crude oil differentials.
The Gulf Coast 5-3-2 crack spread increased to $15.51 per barrel
for the second quarter 2019, compared to $14.37 per barrel for the
same period in 2018. Prior year results were reduced by a charge of
approximately $21.8 million related to a mark-to-market adjustment
of the RINs inventory position at the end of the second quarter
2018, which was the result of refinery waivers received at El
Dorado and Krotz Springs refineries in the first quarter 2018.
Results during the second quarter 2019 include a
Midland to Cushing crude oil market price differential during the
period that was lower than the average market differential due to
an inventory timing effect. The estimated realized Midland to
Cushing differential included in reported results was approximately
$1.77 per barrel during the second quarter 2019, taking into
consideration this inventory timing effect. This compares to a
realized differential of approximately $3.00 per barrel in the
second quarter 2018. During the El Dorado refinery turnaround that
concluded in late April 2019, our refining system continued to
process all of our available Midland crude oil.
The Midland WTI crude oil differential to
Cushing WTI was an average discount of $2.15 per barrel in second
quarter 2019 compared to an average discount of $5.14 per barrel in
the second quarter 2018. During the second quarter 2019, the
Midland WTI crude oil differential to Brent crude oil was an
average discount of $10.88 per barrel compared to $15.03 per barrel
in the prior-year period. Contango in the oil futures market was
$0.20 per barrel in the second quarter 2019, compared to
backwardation of $0.12 per barrel in the second quarter 2018.
Logistics SegmentThe logistics
segment contribution margin in the second quarter 2019 decreased to
$44.2 million compared to $45.4 million in the second quarter 2018.
Continued strong results in the second quarter 2019 benefited from
improved performance in the Paline Pipeline.
Retail SegmentFor the second
quarter 2019, contribution margin was $17.6 million compared to
$18.6 million in the prior year period for the retail segment.
Merchandise sales were approximately $83.3 million with an average
retail margin of 31.2% in the second quarter 2019, compared to
merchandise sales of approximately $90.2 million with an average
retail margin of 31.7% in the prior year period. Approximately 53.7
million retail fuel gallons were sold at an average margin of $0.29
per gallon in the second quarter 2019 compared to 54.1 million
retail fuel gallons sold at an average margin of $0.24 per gallon
in the second quarter 2018. On a same store sales basis in the
second quarter 2019, merchandise sales decreased 2.5% and fuel
gallons sold increased 1.7 % compared to the prior-year period.
Corporate/Other
SegmentContribution margin from the Corporate/Other
segment was income of $10.2 million in the second quarter 2019
compared to a loss of $11.8 million in the prior-year period. This
was primarily driven by system wide commercial initiatives
contributing to bottom-line performance. The net hedging gain
included in this segment in the second quarter 2019 was $14.9
million compared to a net hedging loss of $0.4 million in the
prior-year period.
Second Quarter 2019 Results | Conference
Call InformationDelek US will hold a conference call to
discuss its second quarter 2019 results on Monday, August 5, 2019
at 8:30 a.m. Central Time. Investors will have the opportunity to
listen to the conference call live by going to www.DelekUS.com and
clicking on the Investor Relations tab. Participants are encouraged
to register at least 15 minutes early to download and install any
necessary software. Presentation materials accompanying the call
will be available on the investor relations tab of the Delek US
website approximately five minutes prior to the start of the call.
For those who cannot listen to the live broadcast, a telephonic
replay will be available through November 5, 2019 by dialing (855)
859-2056, passcode 2281457. An archived version of the replay will
also be available at www.DelekUS.com for 90 days.
Investors may also wish to listen to Delek
Logistics’ (NYSE: DKL) second quarter 2019 earnings conference call
that will be held on Monday, August 5, 2019 at 7:30 a.m. Central
Time and review Delek Logistics’ earnings press release. Market
trends and information disclosed by Delek Logistics may be relevant
to the logistics segment reported by Delek US. Both a replay of the
conference call and press release for Delek Logistics are available
online at www.deleklogistics.com.
About Delek US Holdings,
Inc.Delek US Holdings, Inc. is a diversified downstream
energy company with assets in petroleum refining, logistics,
renewable fuels and convenience store retailing. The refining
assets consist of refineries operated in Tyler and Big Spring,
Texas, El Dorado, Arkansas and Krotz Springs, Louisiana with a
combined nameplate crude throughput capacity of 302,000 barrels per
day.
The logistics operations primarily consist of
Delek Logistics Partners, LP (NYSE: DKL). Delek US Holdings,
Inc. and its affiliates own approximately 63% (including the 2
percent general partner interest) of Delek Logistics Partners,
LP. Delek Logistics Partners, LP is a growth-oriented master
limited partnership focused on owning and operating midstream
energy infrastructure assets.
The convenience store retail business is the
largest 7-Eleven licensee in the United States and operates
approximately 263 convenience stores in central and west Texas and
New Mexico.
Safe Harbor Provisions Regarding
Forward-Looking StatementsThis press release contains
forward-looking statements that are based upon current expectations
and involve a number of risks and uncertainties. Statements
concerning current estimates, expectations and projections about
future results, performance, prospects, opportunities, plans,
actions and events and other statements, concerns, or matters that
are not historical facts are “forward-looking statements,” as that
term is defined under the federal securities laws. These
statements contain words such as “possible,” “believe,” “should,”
“could,” “would,” “predict,” “plan,” “estimate,” “intend,” “may,”
“anticipate,” “will,” “if, “potential,” “expect” or similar
expressions, as well as statements in the future tense. These
forward-looking statements include, but are not limited to,
statements regarding throughput at the Company’s refineries; crude
oil prices, discounts and quality and our ability to benefit
therefrom; share repurchases; returning cash to shareholders;
payments of dividends; growth; investments into our business; the
performance and execution of our midstream growth initiatives,
including the Big Spring Gathering System, the Red River joint
venture and the Wink to Webster long-haul crude oil pipeline; the
flexibility, benefits and the expected returns therefrom;
RINs waivers and tax credits and the value and benefit therefrom;
cash and liquidity; opportunities and anticipated performance and
financial position.
Investors are cautioned that the following
important factors, among others, may affect these forward-looking
statements. These factors include, but are not limited to:
uncertainty related to timing and amount of future share
repurchases and dividend payments; risks and uncertainties with
respect to the quantities and costs of crude oil we are able to
obtain and the price of the refined petroleum products we
ultimately sell; risks related to Delek US’ exposure to Permian
Basin crude oil, such as supply, pricing, gathering, production and
transportation capacity; gains and losses from derivative
instruments; management's ability to execute its strategy of growth
through acquisitions and the transactional risks associated with
acquisitions and dispositions; acquired assets may suffer a
diminishment in fair value as a result of which we may need to
record a write-down or impairment in carrying value of the asset;
changes in the scope, costs, and/or timing of capital and
maintenance projects; the ability to grow the Big Spring Gathering
System; the ability of the Red River joint venture to complete the
expansion project to increase the Red River pipeline capacity; the
ability of the joint venture to construct the Wink to Webster long
haul crude oil pipeline; operating hazards inherent in
transporting, storing and processing crude oil and intermediate and
finished petroleum products; our competitive position and the
effects of competition; the projected growth of the industries in
which we operate; general economic and business conditions
affecting the southern United States; and other risks described in
Delek US’ filings with the United States Securities and Exchange
Commission (the “SEC”), including risks disclosed in our Annual
Report on Form 10-K, Quarterly Reports on Form 10-Q and other
filings and reports with the SEC.
Forward-looking statements should not be read as
a guarantee of future performance or results and will not be
accurate indications of the times at, or by, which such performance
or results will be achieved. Forward-looking information is
based on information available at the time and/or management's good
faith belief with respect to future events, and is subject to risks
and uncertainties that could cause actual performance or results to
differ materially from those expressed in the statements.
Delek US undertakes no obligation to update or revise any such
forward-looking statements to reflect events or circumstances that
occur, or which Delek US becomes aware of, after the date hereof,
except as required by applicable law or regulation.
Non-GAAP Disclosures:
Our management uses certain “non-GAAP”
operational measures to evaluate our operating segment performance
and non-GAAP financial measures to evaluate past performance and
prospects for the future to supplement our GAAP financial
information presented in accordance with U.S. GAAP. These financial
and operational non-GAAP measures are important factors in
assessing our operating results and profitability and include:
- Adjusted net income (loss) - calculated as net income
attributable to Delek US adjusted for certain identified
infrequently occurring items, non-cash items and items that are not
attributable to our on-going operations (collectively, "Adjusting
Items") recorded during the period;
- Adjusted unrealized hedging (gains) losses - calculated as GAAP
unrealized (gains) losses on commodity derivatives that are
economic hedges but not designated as hedging instruments adjusted
to exclude unrealized (gains) losses where the instrument has
matured but where it has not cash settled as of the balance sheet
date. This adjustment more appropriately aligns matured commodity
derivatives gains and losses with the recognition of the related
cost of materials and other. There are no premiums paid or received
at the inception of the derivative contracts, and upon settlement
there is no cost recovery associated with these contracts;
- Adjusted net income (loss) per share - calculated as adjusted
net income (loss) divided by weighted average shares outstanding,
assuming dilution, as adjusted for any anti-dilutive instruments
that may not be permitted for consideration in GAAP earnings per
share calculations but that nonetheless favorably impact
dilution;
- Earnings before interest, taxes, depreciation and amortization
("EBITDA") - calculated as net income attributable to Delek
adjusted to add back interest expense, income tax expense,
depreciation and amortization;
- Adjusted EBITDA - calculated as EBITDA adjusted for the
identified adjusting items in adjusted net income (loss) that do
not relate to interest expense, income tax expense, depreciation or
amortization, and adjusted to include income (loss) attributable to
non-controlling interests;
- Refining margin - calculated as the difference between total
refining revenues and total cost of materials and other; and
- Refining margin per sales barrel - calculated as refining
margin divided by our average refining sales in barrels per day
(excluding purchased barrels) multiplied by 1,000 and multiplied by
the number of days in the period.
We believe these non-GAAP operational and
financial measures are useful to investors, lenders, ratings
agencies and analysts to assess our ongoing performance because,
when reconciled to their most comparable GAAP financial measure,
they provide improved comparability between periods through the
exclusion of certain items that we believe are not indicative of
our core operating performance and that may obscure our underlying
results and trends.
Non-GAAP measures have important limitations as
analytical tools, because they exclude some, but not all, items
that affect net earnings and operating income. These measures
should not be considered substitutes for their most directly
comparable U.S. GAAP financial measures. Additionally,
because adjusted net income or loss, adjusted net income or loss
per share, EBITDA and adjusted EBITDA or any of our other
identified non-GAAP measures may be defined differently by other
companies in its industry, Delek US' definition may not be
comparable to similarly titled measures of other companies. See the
accompanying tables in this earnings release for a reconciliation
of these non-GAAP measures to the most directly comparable GAAP
measures.
Delek US
Holdings, Inc. |
Condensed
Consolidated Balance Sheets (Unaudited) |
(In
millions, except share and per share data) |
|
|
June 30, 2019 |
|
December 31, 2018 |
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
951.4 |
|
|
$ |
1,079.3 |
|
Accounts receivable, net |
|
847.4 |
|
|
514.4 |
|
Accounts receivable from related parties |
|
4.2 |
|
|
— |
|
Inventories, net of inventory valuation reserves |
|
891.6 |
|
|
690.9 |
|
Other current assets |
|
92.7 |
|
|
135.7 |
|
Total current assets |
|
2,787.3 |
|
|
2,420.3 |
|
Property, plant and
equipment: |
|
|
|
|
Property, plant and equipment |
|
3,201.1 |
|
|
2,999.6 |
|
Less: accumulated depreciation |
|
(896.1 |
) |
|
(804.7 |
) |
Property, plant and equipment, net |
|
2,305.0 |
|
|
2,194.9 |
|
Operating lease right-of-use
assets |
|
199.2 |
|
|
— |
|
Goodwill |
|
856.6 |
|
|
857.8 |
|
Other intangibles, net |
|
93.5 |
|
|
104.4 |
|
Equity method investments |
|
273.6 |
|
|
130.3 |
|
Other non-current assets |
|
58.0 |
|
|
52.9 |
|
Total assets |
|
$ |
6,573.2 |
|
|
$ |
5,760.6 |
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
1,336.6 |
|
|
$ |
1,009.7 |
|
Accounts payable to related parties |
|
3.5 |
|
|
1.5 |
|
Current portion of long-term debt |
|
64.4 |
|
|
32.0 |
|
Obligation under Supply and Offtake Agreements |
|
257.7 |
|
|
312.6 |
|
Current portion of operating lease liabilities |
|
45.7 |
|
|
— |
|
Accrued expenses and other current liabilities |
|
350.8 |
|
|
307.7 |
|
Total current liabilities |
|
2,058.7 |
|
|
1,663.5 |
|
Non-current liabilities: |
|
|
|
|
Long-term debt, net of current portion |
|
1,852.3 |
|
|
1,751.3 |
|
Obligation under Supply and Offtake Agreements |
|
122.8 |
|
|
49.6 |
|
Environmental liabilities, net of current portion |
|
138.6 |
|
|
139.5 |
|
Asset retirement obligations |
|
72.6 |
|
|
75.5 |
|
Deferred tax liabilities |
|
229.2 |
|
|
210.2 |
|
Operating lease liabilities, net of current portion |
|
155.6 |
|
|
— |
|
Other non-current liabilities |
|
57.2 |
|
|
62.9 |
|
Total non-current liabilities |
|
2,628.3 |
|
|
2,289.0 |
|
Stockholders’ equity: |
|
|
|
|
Common stock, $0.01 par value, 110,000,000 shares authorized,
90,861,698 shares and 90,478,075 shares issued at June 30, 2019 and
December 31, 2018, respectively |
|
0.9 |
|
|
0.9 |
|
Additional paid-in capital |
|
1,140.3 |
|
|
1,135.4 |
|
Accumulated other comprehensive income |
|
26.3 |
|
|
28.6 |
|
Treasury stock, 15,416,502 shares and 12,477,780 shares, at cost,
as of June 30, 2019 and December 31, 2018, respectively |
|
(618.9 |
) |
|
(514.1 |
) |
Retained earnings |
|
1,165.9 |
|
|
981.8 |
|
Non-controlling interests in subsidiaries |
|
171.7 |
|
|
175.5 |
|
Total stockholders’ equity |
|
1,886.2 |
|
|
1,808.1 |
|
Total liabilities and stockholders’ equity |
|
$ |
6,573.2 |
|
|
$ |
5,760.6 |
|
|
Delek US
Holdings, Inc. |
Condensed
Consolidated Statements of Income (Unaudited) (1) |
(In
millions, except share and per share data) |
|
|
Three Months Ended June 30, |
|
Six Months
Ended June 30, |
|
|
2019 |
|
2018 (1) (2) |
|
2019 |
|
2018 (1),(2),(3) |
|
|
|
|
|
|
|
|
|
Net revenues |
|
$ |
2,480.3 |
|
|
$ |
2,636.9 |
|
|
$ |
4,680.2 |
|
|
$ |
4,990.1 |
|
Cost of sales: |
|
|
|
|
|
|
|
|
Cost of materials and other |
|
2,067.7 |
|
|
2,250.2 |
|
|
3,767.1 |
|
|
4,293.0 |
|
Operating expenses (excluding depreciation and amortization
presented below) |
|
135.8 |
|
|
131.4 |
|
|
276.7 |
|
|
264.3 |
|
Depreciation and amortization |
|
42.6 |
|
|
40.4 |
|
|
81.9 |
|
|
78.2 |
|
Total cost of sales |
|
2,246.1 |
|
|
2,422.0 |
|
|
4,125.7 |
|
|
4,635.5 |
|
Operating expenses related to retail and wholesale business
(excluding depreciation and amortization presented below) |
|
26.5 |
|
|
26.1 |
|
|
52.3 |
|
|
51.3 |
|
General and administrative expenses |
|
69.5 |
|
|
52.9 |
|
|
131.7 |
|
|
118.1 |
|
Depreciation and amortization |
|
7.5 |
|
|
8.8 |
|
|
15.0 |
|
|
19.0 |
|
Other operating income, net |
|
(3.6 |
) |
|
(8.0 |
) |
|
(1.2 |
) |
|
(7.7 |
) |
Total operating costs and expenses |
|
2,346.0 |
|
|
2,501.8 |
|
|
4,323.5 |
|
|
4,816.2 |
|
Operating income |
|
134.3 |
|
|
135.1 |
|
|
356.7 |
|
|
173.9 |
|
Interest expense |
|
32.8 |
|
|
31.5 |
|
|
61.5 |
|
|
64.0 |
|
Interest income |
|
(3.3 |
) |
|
(0.9 |
) |
|
(5.8 |
) |
|
(1.6 |
) |
Income from equity method
investments |
|
(9.3 |
) |
|
(2.9 |
) |
|
(11.9 |
) |
|
(2.9 |
) |
Gain on sale of business |
|
— |
|
|
(13.2 |
) |
|
— |
|
|
(13.2 |
) |
Impairment loss on assets held
for sale |
|
— |
|
|
— |
|
|
— |
|
|
27.5 |
|
Loss on extinguishment of
debt |
|
— |
|
|
— |
|
|
— |
|
|
9.0 |
|
Other expense (income),
net |
|
4.9 |
|
|
0.3 |
|
|
3.5 |
|
|
(0.4 |
) |
Total non-operating expenses, net |
|
25.1 |
|
|
14.8 |
|
|
47.3 |
|
|
82.4 |
|
Income from continuing operations before income tax expense |
|
109.2 |
|
|
120.3 |
|
|
309.4 |
|
|
91.5 |
|
Income tax expense |
|
24.6 |
|
|
32.8 |
|
|
70.4 |
|
|
21.3 |
|
Income from continuing operations, net of tax |
|
84.6 |
|
|
87.5 |
|
|
239.0 |
|
|
70.2 |
|
Discontinued operations: |
|
|
|
|
|
|
|
|
Loss from discontinued operations, including loss on sale of
discontinued operations |
|
(1.0 |
) |
|
(1.0 |
) |
|
(1.0 |
) |
|
(11.5 |
) |
Income tax benefit |
|
(0.2 |
) |
|
(0.2 |
) |
|
(0.2 |
) |
|
(2.5 |
) |
Loss from discontinued operations, net of tax |
|
(0.8 |
) |
|
(0.8 |
) |
|
(0.8 |
) |
|
(9.0 |
) |
Net income |
|
83.8 |
|
|
86.7 |
|
|
238.2 |
|
|
61.2 |
|
Net income attributed to
non-controlling interests |
|
6.5 |
|
|
7.6 |
|
|
11.6 |
|
|
22.5 |
|
Net income attributable to
Delek |
|
$ |
77.3 |
|
|
$ |
79.1 |
|
|
$ |
226.6 |
|
|
$ |
38.7 |
|
|
|
|
|
|
|
|
|
|
Basic income (loss) per share: |
|
|
|
|
|
|
|
|
Income from continuing operations |
|
$ |
1.02 |
|
|
$ |
0.95 |
|
|
$ |
2.95 |
|
|
$ |
0.67 |
|
Loss from discontinued operations |
|
(0.01 |
) |
|
(0.01 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.21 |
) |
Total basic income per
share |
|
$ |
1.01 |
|
|
$ |
0.94 |
|
|
$ |
2.94 |
|
|
$ |
0.46 |
|
|
|
|
|
|
|
|
|
|
Diluted income (loss) per share: |
|
|
|
|
|
|
|
|
Income from continuing operations |
|
$ |
1.01 |
|
|
$ |
0.90 |
|
|
$ |
2.92 |
|
|
$ |
0.65 |
|
Loss from discontinued operations |
|
(0.01 |
) |
|
(0.01 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.20 |
) |
Total diluted income per
share |
|
$ |
1.00 |
|
|
$ |
0.89 |
|
|
$ |
2.91 |
|
|
$ |
0.45 |
|
Weighted average common shares
outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
76,598,846 |
|
|
84,041,358 |
|
|
77,192,763 |
|
|
83,151,823 |
|
Diluted |
|
77,280,692 |
|
|
90,244,357 |
|
|
77,883,285 |
|
|
85,773,587 |
|
Dividends declared per common
share outstanding |
|
$ |
0.28 |
|
|
$ |
0.25 |
|
|
$ |
0.55 |
|
|
$ |
0.45 |
|
(1) Certain changes to presentation of the
prior period statements of income have been made in order to
conform to the current period presentation, primarily relating to
the addition of a subtotal entitled 'cost of sales' which includes
all costs directly attributable to the generation of the related
revenue, as defined by GAAP, and the retitling of what was
previously referred to as 'cost of goods sold' to 'cost of
materials and other'. Operating expenses and depreciation and
amortization related to the wholesale business and the retail
business are excluded from cost of sales because they primarily
relate to costs associated with selling the products.
(2) Net revenues and cost of materials and
other for the quarter and six months ended June 30, 2018 reflect a
correction of an intercompany elimination which resulted in an
increase in those accounts of $73.4 million not previously
reflected on the unaudited consolidated financial statements in our
June 30, 2018 Quarterly Report on Form 10-Q filed on August 9,
2018. Such amounts are not considered material to the financial
statements and had no impact to operating income or net income for
those periods. See Note 23 to our annual audited consolidated
financial statements included in Part II, Item 8 of our 2018 Annual
Report on Form 10-K filed on March 1, 2019 for further
discussion.
(3) Income tax benefit for the six
months ended June 30, 2018 reflects a correction made in our 2018
Annual Report on Form 10-K (filed on March 1, 2019) to record
additional deferred tax expense totaling $5.5 million related to
the recognition of a valuation allowance on deferred tax assets
recognized in connection with the Big Spring Logistic Assets
Acquisition (see Note 5) not previously reported in our June 30,
2018 Quarterly Report on Form 10-Q filed on August 09, 2018. Such
amount is not considered material to the financial statements or
the trend of earnings for that period. See Note 23 to our annual
audited consolidated financial statements included in Part II, Item
8 of our 2018 Annual Report on Form 10-K filed on March 1, 2019 for
further discussion.
|
Delek US
Holdings, Inc. |
Condensed
Cash Flow Data (Unaudited) |
(In
millions) |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
Cash flows from
operating activities: |
|
|
|
|
|
Cash provided by (used in) operating activities - continuing
operations |
$ |
102.0 |
|
|
$ |
54.3 |
|
|
$ |
235.4 |
|
|
$ |
(120.8 |
) |
Cash used in operating activities - discontinued operations |
— |
|
|
— |
|
|
— |
|
|
(15.6 |
) |
Net cash provided by (used in) operating activities |
102.0 |
|
|
54.3 |
|
|
235.4 |
|
|
(136.4 |
) |
Cash flows from
investing activities: |
|
|
|
|
|
|
|
Cash (used in) provided by investing activities - continuing
operations |
(202.4 |
) |
|
40.4 |
|
|
(329.4 |
) |
|
8.3 |
|
Cash provided by investing activities - discontinued
operations |
— |
|
|
— |
|
|
— |
|
|
5.5 |
|
Net cash (used in) provided by investing activities |
(202.4 |
) |
|
40.4 |
|
|
(329.4 |
) |
|
13.8 |
|
Cash flows from
financing activities: |
|
|
|
|
|
|
|
Cash (used in) provided by financing activities - continuing
operations |
62.1 |
|
|
20.1 |
|
|
(33.9 |
) |
|
313.5 |
|
Cash provided by (used in) financing activities - discontinued
operations |
— |
|
|
— |
|
|
— |
|
|
— |
|
Net cash (used in) provided by financing activities |
62.1 |
|
|
20.1 |
|
|
(33.9 |
) |
|
313.5 |
|
Net (decrease) increase in
cash and cash equivalents |
(38.3 |
) |
|
114.8 |
|
|
(127.9 |
) |
|
190.9 |
|
Cash and cash equivalents at
the beginning of the period |
989.7 |
|
|
1,018.0 |
|
|
1,079.3 |
|
|
941.9 |
|
Cash and cash equivalents at
the end of the period |
951.4 |
|
|
1,132.8 |
|
|
951.4 |
|
|
1,132.8 |
|
Less cash and cash equivalents
of discontinued operations at the end of the period |
— |
|
|
— |
|
|
— |
|
|
— |
|
Cash and cash equivalents of
continuing operations at the end of the period |
$ |
951.4 |
|
|
$ |
1,132.8 |
|
|
$ |
951.4 |
|
|
$ |
1,132.8 |
|
|
|
|
|
|
|
|
|
|
|
|
Delek US Holdings,
Inc. |
|
|
|
|
|
|
|
|
|
|
Segment Data
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
(In
millions) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2019 |
|
|
Refining |
|
Logistics |
|
Retail |
|
Corporate, Other and Eliminations |
|
Consolidated |
Net revenues (excluding intercompany fees and sales) |
|
$ |
2,152.5 |
|
|
$ |
93.1 |
|
|
$ |
224.5 |
|
|
$ |
10.2 |
|
|
$ |
2,480.3 |
|
Intercompany fees and sales |
|
215.3 |
|
|
62.2 |
|
|
— |
|
|
(277.5 |
) |
|
— |
|
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
Cost of materials and other |
|
2,074.5 |
|
|
93.8 |
|
|
182.1 |
|
|
(282.7 |
) |
|
2,067.7 |
|
Operating expenses (excluding depreciation and amortization
presented below) |
|
115.0 |
|
|
17.3 |
|
|
24.8 |
|
|
5.2 |
|
|
162.3 |
|
Segment contribution margin |
|
$ |
178.3 |
|
|
$ |
44.2 |
|
|
$ |
17.6 |
|
|
$ |
10.2 |
|
|
$ |
250.3 |
|
Depreciation and amortization |
|
33.2 |
|
|
6.7 |
|
|
4.2 |
|
|
6.0 |
|
|
50.1 |
|
General and administrative expenses |
|
|
|
|
|
|
|
|
|
69.5 |
|
Other operating income, net |
|
|
|
|
|
|
|
|
|
(3.6 |
) |
Operating income |
|
|
|
|
|
|
|
|
|
$ |
134.3 |
|
Total assets |
|
$ |
6,749.6 |
|
|
$ |
769.3 |
|
|
$ |
351.2 |
|
|
$ |
(1,296.9 |
) |
|
$ |
6,573.2 |
|
Capital spending (excluding
business combinations) |
|
$ |
48.9 |
|
|
$ |
1.3 |
|
|
$ |
5.4 |
|
|
$ |
30.4 |
|
|
$ |
86.0 |
|
|
|
Three Months Ended June 30, 2018 |
|
|
Refining (2) |
|
Logistics |
|
Retail |
|
Corporate, Other and Eliminations |
|
Consolidated (2) |
Net revenues (excluding intercompany fees and sales) |
|
$ |
2,317.1 |
|
|
$ |
113.3 |
|
|
$ |
244.8 |
|
|
$ |
(38.3 |
) |
|
$ |
2,636.9 |
|
Intercompany fees and sales |
|
226.1 |
|
|
53.0 |
|
|
— |
|
|
(279.1 |
) |
|
— |
|
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
Cost of materials and other |
|
2,253.0 |
|
|
106.0 |
|
|
200.9 |
|
|
(309.7 |
) |
|
2,250.2 |
|
Operating expenses (excluding depreciation and amortization
presented below) |
|
113.2 |
|
|
14.9 |
|
|
25.3 |
|
|
4.1 |
|
|
157.5 |
|
Segment contribution margin |
|
$ |
177.0 |
|
|
$ |
45.4 |
|
|
$ |
18.6 |
|
|
$ |
(11.8 |
) |
|
229.2 |
|
Depreciation and amortization |
|
33.1 |
|
|
7.0 |
|
|
4.6 |
|
|
4.5 |
|
|
49.2 |
|
General and administrative expenses |
|
|
|
|
|
|
|
|
|
52.9 |
|
Other operating income, net |
|
|
|
|
|
|
|
|
|
(8.0 |
) |
Operating income |
|
|
|
|
|
|
|
|
|
$ |
135.1 |
|
Total assets (1) |
|
$ |
5,101.7 |
|
|
$ |
650.3 |
|
|
$ |
332.8 |
|
|
$ |
127.0 |
|
|
$ |
6,211.8 |
|
Capital spending (excluding
business combinations) (2) |
|
$ |
33.7 |
|
|
$ |
2.3 |
|
|
$ |
2.1 |
|
|
$ |
16.6 |
|
|
$ |
54.7 |
|
|
|
|
|
|
|
|
|
|
|
|
Delek US Holdings,
Inc. |
|
|
|
|
|
|
|
|
|
|
Segment Data
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
(In
millions) |
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2019 |
|
|
Refining |
|
Logistics |
|
Retail |
|
Corporate, Other and Eliminations |
|
Consolidated |
Net revenues (excluding intercompany fees and sales) |
|
$ |
4,059.9 |
|
|
$ |
182.9 |
|
|
$ |
421.7 |
|
|
$ |
15.7 |
|
|
$ |
4,680.2 |
|
Intercompany fees and sales |
|
399.9 |
|
|
124.9 |
|
|
— |
|
|
(524.8 |
) |
|
— |
|
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
Cost of materials and other |
|
3,751.2 |
|
|
190.1 |
|
|
345.5 |
|
|
(519.7 |
) |
|
3,767.1 |
|
Operating expenses (excluding depreciation and amortization
presented below) |
|
236.0 |
|
|
33.4 |
|
|
48.4 |
|
|
11.2 |
|
|
329.0 |
|
Segment contribution margin |
|
$ |
472.6 |
|
|
$ |
84.3 |
|
|
$ |
27.8 |
|
|
$ |
(0.6 |
) |
|
$ |
584.1 |
|
Depreciation and amortization |
|
64.3 |
|
|
13.2 |
|
|
8.5 |
|
|
10.9 |
|
|
96.9 |
|
General and administrative expenses |
|
|
|
|
|
|
|
|
|
131.7 |
|
Other operating income, net |
|
|
|
|
|
|
|
|
|
(1.2 |
) |
Operating income |
|
|
|
|
|
|
|
|
|
$ |
356.7 |
|
Capital spending (excluding
business combinations) |
|
$ |
130.5 |
|
|
$ |
2.2 |
|
|
$ |
10.5 |
|
|
$ |
71.1 |
|
|
$ |
214.3 |
|
|
|
Six Months Ended June 30, 2018 |
|
|
Refining (2) (3) |
|
Logistics |
|
Retail |
|
Corporate, Other and Eliminations (3) |
|
Consolidated (2) |
Net revenues (excluding intercompany fees and sales) |
|
$ |
4,257.8 |
|
|
$ |
219.5 |
|
|
$ |
454.4 |
|
|
$ |
58.4 |
|
|
$ |
4,990.1 |
|
Intercompany fees and sales |
|
411.3 |
|
|
114.7 |
|
|
— |
|
|
(526.0 |
) |
|
— |
|
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
Cost of materials and other |
|
4,130.9 |
|
|
225.0 |
|
|
374.1 |
|
|
(437.0 |
) |
|
4,293.0 |
|
Operating expenses (excluding depreciation and amortization
presented below) |
|
227.9 |
|
|
27.5 |
|
|
49.8 |
|
|
10.4 |
|
|
315.6 |
|
Segment contribution margin |
|
$ |
310.3 |
|
|
$ |
81.7 |
|
|
$ |
30.5 |
|
|
$ |
(41.0 |
) |
|
$ |
381.5 |
|
Depreciation and amortization |
|
65.3 |
|
|
13.0 |
|
|
11.5 |
|
|
7.4 |
|
|
97.2 |
|
General and administrative expenses |
|
|
|
|
|
|
|
|
|
118.1 |
|
Other operating income, net |
|
|
|
|
|
|
|
|
|
(7.7 |
) |
Operating Income |
|
|
|
|
|
|
|
|
|
$ |
173.9 |
|
Capital spending (excluding
business combinations) (3) |
|
$ |
85.2 |
|
|
$ |
4.5 |
|
|
$ |
4.1 |
|
|
$ |
31.0 |
|
|
$ |
124.8 |
|
Assets held for sale of $25.2 million are
included in the corporate, other and eliminations segment as of
June 30, 2018.
(1) Refining segment and consolidated
net revenues and cost of materials and other for the quarter and
six months ended June 30, 2018 reflect a correction of an
intercompany elimination which resulted in an increase in those
accounts of $73.4 million not previously reflected on the unaudited
consolidated financial statements in our June 30, 2018 Quarterly
Report on Form 10-Q filed on August 9, 2018. Such amounts are not
considered material to the financial statements and had no impact
to operating income or segment contribution margin for those
periods. See Note 23 to our annual audited consolidated financial
statements included in Part II, Item 8 of our 2018 Annual Report on
Form 10-K, as amended and filed on June 27, 2019, for further
discussion.
(2) Capital spending excludes
transaction costs capitalized in the amount of $0.4 million during
the six months ended June 30, 2018, that relate to the Big
Spring Logistic Assets Acquisition (as defined in Note 5).
(3) The corporate, other and
eliminations segment results of operations for the six months ended
June 30, 2018 includes Canada trading activity which was
previously included and reported in the refining segment for the
three months ended March 31, 2018.
|
|
|
|
|
Refining
Segment |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
Tyler, TX
Refinery |
|
(Unaudited) |
|
(Unaudited) |
Days in period |
|
91 |
|
|
91 |
|
|
181 |
|
|
181 |
|
Total sales volume - refined
product (average barrels per day)(1) |
|
77,657 |
|
|
81,088 |
|
|
73,863 |
|
|
77,555 |
|
Products manufactured (average
barrels per day): |
|
|
|
|
|
|
|
|
Gasoline |
|
39,997 |
|
|
42,918 |
|
|
39,671 |
|
|
41,800 |
|
Diesel/Jet |
|
31,505 |
|
|
32,899 |
|
|
29,455 |
|
|
30,275 |
|
Petrochemicals, LPG, NGLs |
|
3,318 |
|
|
2,877 |
|
|
2,690 |
|
|
2,479 |
|
Other |
|
1,654 |
|
|
1,742 |
|
|
1,411 |
|
|
1,756 |
|
Total production |
|
76,474 |
|
|
80,436 |
|
|
73,227 |
|
|
76,310 |
|
Throughput (average barrels
per day): |
|
|
|
|
|
|
|
|
Crude oil |
|
71,918 |
|
|
75,272 |
|
|
68,219 |
|
|
70,305 |
|
Other feedstocks |
|
5,106 |
|
|
5,902 |
|
|
5,785 |
|
|
6,537 |
|
Total throughput |
|
77,024 |
|
|
81,174 |
|
|
74,004 |
|
|
76,842 |
|
Per barrel of refined product
sales: |
|
|
|
|
|
|
|
|
Tyler refining margin |
|
$ |
12.15 |
|
|
$ |
11.90 |
|
|
$ |
16.84 |
|
|
$ |
10.21 |
|
Tyler adjusted refining margin |
|
$ |
12.12 |
|
|
$ |
11.83 |
|
|
$ |
13.98 |
|
|
$ |
9.04 |
|
Direct operating expenses |
|
$ |
3.65 |
|
|
$ |
3.38 |
|
|
$ |
4.15 |
|
|
$ |
3.40 |
|
Crude Slate: (% based on
amount received in period) |
|
|
|
|
|
|
|
|
WTI crude oil |
|
87.7 |
% |
|
77.5 |
% |
|
89.3 |
% |
|
79.2 |
% |
East Texas crude oil |
|
12.3 |
% |
|
21.0 |
% |
|
10.7 |
% |
|
18.8 |
% |
Other |
|
— |
% |
|
1.5 |
% |
|
— |
% |
|
2.0 |
% |
|
|
|
|
|
|
|
|
|
El Dorado, AR
Refinery |
|
|
|
|
|
|
|
|
Days in period |
|
91 |
|
|
91 |
|
|
181 |
|
|
181 |
|
Total sales volume - refined
product (average barrels per day)(2) |
|
51,002 |
|
|
76,353 |
|
|
51,717 |
|
|
73,488 |
|
Products manufactured (average
barrels per day): |
|
|
|
|
|
|
|
|
Gasoline |
|
21,821 |
|
|
36,285 |
|
|
21,159 |
|
|
35,689 |
|
Diesel |
|
17,802 |
|
|
25,256 |
|
|
16,633 |
|
|
25,773 |
|
Petrochemicals, LPG, NGLs |
|
551 |
|
|
1,236 |
|
|
678 |
|
|
1,350 |
|
Asphalt |
|
6,961 |
|
|
4,662 |
|
|
5,899 |
|
|
4,895 |
|
Other |
|
683 |
|
|
785 |
|
|
661 |
|
|
812 |
|
Total production |
|
47,818 |
|
|
68,224 |
|
|
45,030 |
|
|
68,519 |
|
Throughput (average barrels
per day): |
|
|
|
|
|
|
|
|
Crude oil |
|
47,935 |
|
|
68,685 |
|
|
44,542 |
|
|
68,559 |
|
Other feedstocks |
|
359 |
|
|
1,175 |
|
|
1,270 |
|
|
1,475 |
|
Total throughput |
|
48,294 |
|
|
69,860 |
|
|
45,812 |
|
|
70,034 |
|
Per barrel of refined product
sales: |
|
|
|
|
|
|
|
|
El Dorado refining margin |
|
$ |
8.93 |
|
|
$ |
4.74 |
|
|
$ |
11.21 |
|
|
$ |
8.73 |
|
El Dorado adjusted refining margin |
|
$ |
9.07 |
|
|
7.22 |
|
|
$ |
11.67 |
|
|
$ |
5.41 |
|
Direct operating expenses |
|
$ |
5.93 |
|
|
$ |
4.84 |
|
|
$ |
6.31 |
|
|
$ |
4.99 |
|
Crude Slate: (% based on
amount received in period) |
|
|
|
|
|
|
|
|
WTI crude oil |
|
43.9 |
% |
|
68.0 |
% |
|
42.6 |
% |
|
65.1 |
% |
Local Arkansas crude oil |
|
29.0 |
% |
|
21.0 |
% |
|
28.3 |
% |
|
20.7 |
% |
Other |
|
27.1 |
% |
|
11.0 |
% |
|
29.1 |
% |
|
14.2 |
% |
Refining
Segment |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
Big Spring, TX
Refinery |
|
(Unaudited) |
(Unaudited) |
Days in period - based on date
acquired |
|
91 |
|
|
91 |
|
|
181 |
|
|
181 |
|
Total sales volume - refined
product (average barrels per day) (3) |
|
78,158 |
|
|
77,005 |
|
|
79,993 |
|
|
69,928 |
|
Products manufactured (average
barrels per day): |
|
|
|
|
|
|
|
|
Gasoline |
|
36,428 |
|
|
36,009 |
|
|
37,657 |
|
|
33,581 |
|
Diesel/Jet |
|
26,638 |
|
|
29,266 |
|
|
27,494 |
|
|
24,180 |
|
Petrochemicals, LPG, NGLs |
|
3,679 |
|
|
3,834 |
|
|
3,763 |
|
|
3,431 |
|
Asphalt |
|
1,900 |
|
|
1,856 |
|
|
1,707 |
|
|
1,856 |
|
Other |
|
1,354 |
|
|
1,476 |
|
|
1,296 |
|
|
1,295 |
|
Total production |
|
69,999 |
|
|
72,441 |
|
|
71,917 |
|
|
64,343 |
|
Throughput (average barrels
per day): |
|
|
|
|
|
|
|
|
Crude oil |
|
72,965 |
|
|
72,013 |
|
|
72,649 |
|
|
62,936 |
|
Other feedstocks |
|
(581 |
) |
|
171 |
|
|
648 |
|
|
1,007 |
|
Total throughput |
|
72,384 |
|
|
72,184 |
|
|
73,297 |
|
|
63,943 |
|
Per barrel of refined product
sales: |
|
|
|
|
|
|
|
|
Big Spring refining margin |
|
$ |
13.77 |
|
|
$ |
16.88 |
|
|
$ |
16.00 |
|
|
$ |
13.62 |
|
Big Spring adjusted refining margin |
|
$ |
13.87 |
|
|
$ |
16.99 |
|
|
$ |
16.28 |
|
|
$ |
13.66 |
|
Direct operating expenses |
|
$ |
3.69 |
|
|
$ |
3.57 |
|
|
$ |
3.75 |
|
|
$ |
4.31 |
|
Crude Slate: (% based on
amount received in period) |
|
|
|
|
|
|
|
|
WTI crude oil |
|
73.3 |
% |
|
72.0 |
% |
|
76.3 |
% |
|
71.2 |
% |
WTS crude oil |
|
26.7 |
% |
|
28.0 |
% |
|
23.7 |
% |
|
28.8 |
% |
|
|
|
|
|
|
|
|
|
Krotz Springs, LA
Refinery |
|
|
|
|
|
|
|
|
Days in period - based on date
acquired |
|
91 |
|
|
91 |
|
|
181 |
|
|
181 |
|
Total sales volume - refined
product (average barrels per day) (4) |
|
75,283 |
|
|
76,789 |
|
|
76,749 |
|
|
78,335 |
|
Products manufactured (average
barrels per day): |
|
|
|
|
|
|
|
|
Gasoline |
|
34,498 |
|
|
35,976 |
|
|
36,270 |
|
|
37,515 |
|
Diesel/Jet |
|
29,776 |
|
|
32,008 |
|
|
30,082 |
|
|
31,534 |
|
Heavy oils |
|
1,110 |
|
|
1,362 |
|
|
1,100 |
|
|
1,350 |
|
Petrochemicals, LPG, NGLs |
|
4,264 |
|
|
7,295 |
|
|
5,758 |
|
|
7,522 |
|
Other |
|
— |
|
|
— |
|
|
52 |
|
|
— |
|
Total production |
|
69,648 |
|
|
76,641 |
|
|
73,262 |
|
|
77,921 |
|
Throughput (average barrels
per day): |
|
|
|
|
|
|
|
|
Crude oil |
|
70,162 |
|
|
74,625 |
|
|
71,240 |
|
|
74,256 |
|
Other feedstocks |
|
(1,327 |
) |
|
997 |
|
|
908 |
|
|
2,406 |
|
Total throughput |
|
68,835 |
|
|
75,622 |
|
|
72,148 |
|
|
76,662 |
|
Per barrel of refined product
sales: |
|
|
|
|
|
|
|
|
Krotz Springs refining margin |
|
$ |
9.69 |
|
|
$ |
8.82 |
|
|
$ |
10.84 |
|
|
$ |
7.86 |
|
Krotz Springs adjusted refining margin |
|
$ |
9.77 |
|
|
$ |
9.48 |
|
|
$ |
11.38 |
|
|
$ |
6.06 |
|
Direct operating expenses |
|
$ |
4.39 |
|
|
$ |
3.87 |
|
|
$ |
4.14 |
|
|
$ |
3.72 |
|
Crude Slate: (% based on
amount received in period) |
|
|
|
|
|
|
|
|
WTI Crude |
|
61.0 |
% |
|
54.9 |
% |
|
62.0 |
% |
|
57.2 |
% |
Gulf Coast Sweet Crude |
|
39.0 |
% |
|
45.1 |
% |
|
38.0 |
% |
|
42.8 |
% |
Pricing
statistics |
|
|
|
|
(average for the
period presented) |
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
WTI — Cushing crude oil (per barrel) |
|
$ |
59.80 |
|
|
$ |
68.03 |
|
|
$ |
57.36 |
|
|
$ |
65.52 |
|
WTI — Midland crude oil (per
barrel) |
|
$ |
57.56 |
|
|
$ |
59.93 |
|
|
$ |
55.65 |
|
|
$ |
61.19 |
|
WTS -- Midland crude oil (per
barrel) (5) |
|
$ |
57.93 |
|
|
$ |
59.53 |
|
|
$ |
55.95 |
|
|
$ |
60.47 |
|
LLS crude oil (per barrel)
(5) |
|
$ |
67.06 |
|
|
$ |
73.02 |
|
|
$ |
64.73 |
|
|
$ |
69.51 |
|
Brent crude oil (per
barrel) |
|
$ |
68.44 |
|
|
$ |
74.96 |
|
|
$ |
66.14 |
|
|
$ |
71.18 |
|
|
|
|
|
|
|
|
|
|
US Gulf Coast 5-3-2 crack
spread (per barrel) (5) |
|
$ |
15.51 |
|
|
$ |
14.37 |
|
|
$ |
14.28 |
|
|
$ |
12.99 |
|
US Gulf Coast 3-2-1 crack
spread (per barrel) (5) |
|
$ |
19.24 |
|
|
$ |
18.26 |
|
|
$ |
17.23 |
|
|
$ |
16.82 |
|
US Gulf Coast 2-1-1 crack
spread (per barrel) (5) |
|
$ |
9.75 |
|
|
$ |
10.83 |
|
|
$ |
8.55 |
|
|
$ |
10.29 |
|
|
|
|
|
|
|
|
|
|
US Gulf Coast Unleaded
Gasoline (per gallon) |
|
$ |
1.79 |
|
|
$ |
1.96 |
|
|
$ |
1.66 |
|
|
$ |
1.87 |
|
Gulf Coast Ultra low sulfur
diesel (per gallon) |
|
$ |
1.94 |
|
|
$ |
2.11 |
|
|
$ |
1.91 |
|
|
$ |
2.02 |
|
US Gulf Coast high sulfur
diesel (per gallon) |
|
$ |
1.80 |
|
|
$ |
1.96 |
|
|
$ |
1.78 |
|
|
$ |
1.87 |
|
Natural gas (per MMBTU) |
|
$ |
2.51 |
|
|
$ |
2.83 |
|
|
$ |
2.69 |
|
|
$ |
2.84 |
|
(1) Total sales volume includes 628
bpd and 366 bpd sold to the El Dorado refinery, 104 bpd and 100 bpd
sold to the Big Spring refinery, 182 bpd and 91 bpd sold to the
Krotz Springs refinery and 24 bpd and 281 bpd sold to the logistics
segment during the three and six months ended June 30, 2019,
respectively. Total sales volume includes 109 bpd and 120 bpd
sold to the El Dorado refinery, 428 bpd and 459 bpd sold to the Big
Spring refinery, no bpd and 118 bpd sold to the Krotz Springs
refinery and 267 bpd and 917 bpd sold to the logistics segment
during the three and six months ended June 30, 2018,
respectively. Total sales volume excludes wholesale activity of
4,939 bpd and 4,760 bpd of during the three and six months ended
June 30, 2019, respectively, and 4,729 bpd and 4,603 bpd
during the three and six months ended June 30, 2018,
respectively.
(2) Total sales volume includes 333
bpd and no bpd sold to the Tyler refinery, 33,659 bpd and no bpd
sold to the Krotz Springs refinery, 377 bpd and no bpd sold to the
Big Spring refinery, 15 bpd and no bpd sold to logistics segment
and 43 bpd and no bpd sold to Alon Asphalt Company during the three
and six months ended June 30, 2019, respectively. Total sales
volume includes 985 bpd and 515 bpd sold to the Tyler refinery,
21,648 bpd and 11,407 bpd sold to the Krotz Springs refinery, 302
bpd and 566 bpd sold to the Big Spring refinery, no bpd and no bpd
sold to logistics segment and 220 bpd and 123 bpd sold to Alon
Asphalt Company during the three and six months ended June 30,
2018, respectively. Total sales volume excludes wholesale
activity of 67,741 bpd and 66,237 bpd during the three and six
months ended June 30, 2019, respectively, and 48,287 bpd and
50,709 bpd during the three and six months ended June 30,
2018, respectively.
(3) Total sales volume includes 653
bpd and no bpd sold to the Tyler refinery, no bpd and no bpd sold
to the El Dorado refinery, 13,914 bpd and no bpd sold to the retail
segment, 9,401 bpd and no bpd sold to the logistics segment and
1,900 bpd and no bpd sold to Alon Asphalt Company during the three
and six months ended June 30, 2019, respectively. Total sales
volume includes 600 bpd and 410 bpd sold to the Tyler refinery, no
bpd and no bpd sold to the El Dorado refinery, 13,838 bpd and
14,026 bpd sold to the retail segment, 3,158 bpd and 4,237 bpd sold
to the logistics segment and 1,895 bpd and 1,522 bpd sold to Alon
Asphalt Company during the three and six months ended June 30,
2018, respectively. Total sales volume excludes wholesale activity
of 8,183 bpd and 7,833 bpd during the three and six months ended
June 30, 2019, respectively, and 5,927 bpd and 8,103 bpd
during the three and six months ended June 30, 2018,
respectively.
(4) Total sales volume includes
10,185 bpd and no bpd sold to the El Dorado refinery and 26 bpd and
no bpd sold to the Tyler refinery during the three and six months
ended June 30, 2019, respectively. Total sales volume includes
39,398 bpd and 29,130 bpd sold to the El Dorado refinery and no bpd
and 110 bpd sold to the Tyler refinery during the three and six
months ended June 30, 2018, respectively. Total sales volume
excludes wholesale activity of 13,977 bpd and 15,196 bpd during the
three and six months ended June 30, 2019, respectively, and
10,222 bpd and 7,247 bpd during the three and six months ended
June 30, 2018, respectively.
(5) For our Tyler and El Dorado
refineries, we compare our per barrel refining product margin to
the Gulf Coast 5-3-2 crack spread consisting of WTI Cushing crude,
U.S. Gulf Coast CBOB and U.S, Gulf Coast Pipeline No. 2 heating oil
(high sulfur diesel). For our Big Spring refinery, we compare
our per barrel refined product margin to the Gulf Coast 3-2-1 crack
spread consisting of WTI Cushing crude, Gulf Coast 87 Conventional
gasoline and Gulf Coast ultra low sulfur diesel, and for our Krotz
Springs refinery, we compare our per barrel refined product margin
to the Gulf Coast 2-1-1 crack spread consisting of LLS crude oil,
Gulf Coast 87 Conventional gasoline and U.S, Gulf Coast Pipeline
No. 2 heating oil (high sulfur diesel). The Tyler refinery's
crude oil input is primarily WTI Midland and east Texas, while the
El Dorado refinery's crude input is primarily a combination of WTI
Midland, local Arkansas and other domestic inland crude oil. The
Big Spring refinery’s crude oil input is primarily comprised of WTS
and WTI Midland. The Krotz Springs refinery’s crude oil input is
primarily comprised of LLS and WTI Midland.
|
Delek US
Holdings, Inc. |
Reconciliation of Refining Margin per barrel to Adjusted
Refining Margin per barrel (1) |
$ in
millions, except per share data |
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Tyler
(2) |
|
|
|
|
|
|
|
|
Reported refining margin, $ per barrel |
|
$ |
12.15 |
|
|
$ |
11.90 |
|
|
$ |
16.84 |
|
|
$ |
10.21 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Net inventory valuation
(benefit) |
|
(0.03 |
) |
|
(0.07 |
) |
|
(2.86 |
) |
|
(0.07 |
) |
Renewable biofuels credit
allocated to refinery |
|
— |
|
|
— |
|
|
— |
|
|
(1.10 |
) |
|
|
|
|
|
|
|
|
|
Adjusted refining margin
$/bbl |
|
$ |
12.12 |
|
|
$ |
11.83 |
|
|
$ |
13.98 |
|
|
$ |
9.04 |
|
|
El Dorado
(3) |
|
|
|
|
|
|
|
|
Reported refining margin, $
per barrel |
|
$ |
8.93 |
|
|
$ |
4.74 |
|
|
$ |
11.21 |
|
|
$ |
8.73 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Net inventory valuation
loss |
|
0.14 |
|
|
0.01 |
|
|
0.46 |
|
|
0.01 |
|
RIN waiver |
|
— |
|
|
— |
|
|
— |
|
|
(4.46 |
) |
Renewable biofuels credit
allocated to refinery |
|
— |
|
|
— |
|
|
— |
|
|
(0.45 |
) |
Non-cash RINs inventory
mark-to-market |
|
— |
|
|
2.47 |
|
|
— |
|
|
1.58 |
|
|
|
|
|
|
|
|
|
|
Adjusted refining margin
$/bbl |
|
$ |
9.07 |
|
|
$ |
7.22 |
|
|
$ |
11.67 |
|
|
$ |
5.41 |
|
|
|
|
|
|
|
|
|
|
Big Spring
(4) |
|
|
|
|
|
|
|
|
Reported refining margin, $
per barrel |
|
$ |
13.77 |
|
|
$ |
16.88 |
|
|
$ |
16.00 |
|
|
$ |
13.62 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Net inventory valuation
loss |
|
0.10 |
|
|
0.11 |
|
|
0.28 |
|
|
0.04 |
|
|
|
|
|
|
|
|
|
|
Adjusted refining margin
$/bbl |
|
$ |
13.87 |
|
|
$ |
16.99 |
|
|
$ |
16.28 |
|
|
$ |
13.66 |
|
|
|
|
|
|
|
|
|
|
Krotz Springs
(5) |
|
|
|
|
|
|
|
|
Reported refining margin, $
per barrel |
|
$ |
9.69 |
|
|
$ |
8.82 |
|
|
$ |
10.84 |
|
|
$ |
7.86 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Net inventory valuation
loss |
|
0.08 |
|
|
0.01 |
|
|
0.54 |
|
|
0.01 |
|
RIN waiver |
|
— |
|
|
— |
|
|
— |
|
|
(2.23 |
) |
Non-cash RINs inventory
mark-to-market |
|
— |
|
|
0.65 |
|
|
— |
|
|
0.42 |
|
|
|
|
|
|
|
|
|
|
Adjusted refining margin
$/bbl |
|
$ |
9.77 |
|
|
$ |
9.48 |
|
|
$ |
11.38 |
|
|
$ |
6.06 |
|
(1) Adjusted refining margin per
barrel is presented to provide a measure to evaluate performance
excluding inventory valuation adjustments and other items at the
individual refinery level. Delek US believes that the presentation
of adjusted measures provides useful information to investors in
assessing its results of operations at each refinery. Because
adjusted refining margin per barrel may be defined differently by
other companies in its industry, Delek US' definition may not be
comparable to similarly titled measures of other companies.
(2) Tyler adjusted refining margins exclude the
following items.
Net inventory
valuation benefit - There was approximately $0.2 million
and $0.5 million of valuation benefit in the second quarter 2019
and 2018, respectively. There was approximately $38.3 million and
$1.0 million of valuation benefit for the six months ended June 30,
2019 and 2018, respectively. These amounts resulted from lower of
cost or market adjustments on LIFO inventory in the respective
periods.
Biodiesel tax
credit allocation - There was approximately $15.4 million
related to the biodiesel tax credit that was allocated to Tyler in
the first quarter of 2018 that is included in the renewables
portion of the refining segment for the six months ended June 30,
2018.
(3) El Dorado adjusted refining margins exclude the
following items.
Net inventory
valuation loss - There were $0.7 million and $0.05 million
of valuation losses in the second quarter 2019 and 2018,
respectively. There was approximately $4.3 million and
$0.08 million of valuation losses for the six months ended
June 30, 2019 and 2018, respectively. These amounts resulted from
lower of cost or market adjustments on FIFO inventory in the
respective periods.
RIN
waiver - During the second quarter 2019, the Environmental
Protection Agency did not finalize its decision related to small
refinery exemption from the requirements of the renewable fuel
standard for the 2018 calendar year. In March 2018, the El Dorado
refinery received approval from the Environmental Protection Agency
for a small refinery exemption from the requirements of the
renewable fuel standard for the 2017 calendar year. This waiver
equated to a benefit of approximately $59.3 million recognized in
the first quarter 2018.
Biodiesel tax
credit allocation - There was approximately $6.0 million
related to the biodiesel tax credit that was allocated to El Dorado
in the first quarter of 2018 that is included in the renewables
portion of the refining segment for the six months ended June 30,
2018.
Non-cash RINs
inventory mark-to-market - Relates to a $17.2 million
charge for a mark-to-market of the Renewable Identification Numbers
(RINs) inventory position that occurred in the second quarter 2018.
The inventory position was higher due to the waiver received by El
Dorado refinery in March 2018.
(4) Big Spring adjusted refining margins exclude the
following items.
Net inventory
valuation loss - There were approximately $0.7 million and
$0.8 million of valuation losses in the second quarter 2019 and
2018, respectively. There was approximately $4.1 million and
$0.5 million of valuation losses for the six months ended June 30,
2019 and 2018, respectively. These amounts resulted from lower of
cost or market adjustments on FIFO inventory in the respective
period.
(5) Krotz Springs adjusted refining margins exclude
the following items.
Net inventory
valuation loss - There were $0.6 million and $0.1 million
of valuation losses in the second quarter 2019 and 2018,
respectively. There was approximately $7.4 million and $0.11
million of valuation losses for the six months ended June 30, 2019
and 2018, respectively. These amounts resulted from lower of cost
or market adjustments on FIFO inventory in the period.
RIN
waiver - During the second quarter 2019, the Environmental
Protection Agency did not finalize its decision related to small
refinery exemption from the requirements of the renewable fuel
standard for the 2018 calendar year. In March 2018, the Krotz
Springs refinery received approval from the Environmental
Protection Agency for a small refinery exemption from the
requirements of the renewable fuel standard for the 2017 calendar
year. This waiver equated to a benefit of approximately $31.6
million recognized in the first quarter 2018.
Non-cash RINs
inventory mark-to-market - Relates to a $4.6 charge for a
mark-to-market of the Renewable Identification Numbers (RINs)
inventory position that occurred in the second quarter 2018. The
inventory position was higher due to the waiver received by El
Dorado refinery in March 2018.
|
Logistics
Segment |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Pipelines &
Transportation: (average bpd) |
|
|
|
|
|
|
|
|
Lion Pipeline System: |
|
|
|
|
|
|
|
|
Crude pipelines (non-gathered) |
|
37,625 |
|
|
56,088 |
|
|
33,179 |
|
|
55,412 |
|
Refined products pipelines |
|
29,893 |
|
|
48,013 |
|
|
26,511 |
|
|
48,879 |
|
SALA Gathering System |
|
17,777 |
|
|
16,738 |
|
|
17,390 |
|
|
16,705 |
|
East Texas Crude Logistics System |
|
19,550 |
|
|
16,902 |
|
|
18,835 |
|
|
17,478 |
|
|
|
|
|
|
|
|
|
|
Wholesale Marketing
& Terminalling: |
|
|
|
|
|
|
|
|
East Texas - Tyler Refinery sales volumes (average bpd) (1) |
|
71,123 |
|
|
79,330 |
|
|
69,857 |
|
|
76,304 |
|
West Texas marketing throughputs (average bpd) |
|
11,404 |
|
|
12,261 |
|
|
12,418 |
|
|
14,091 |
|
West Texas gross margin per barrel |
|
$ |
6.25 |
|
|
$ |
8.06 |
|
|
$ |
4.84 |
|
|
$ |
6.43 |
|
Big Spring Marketing - Refinery sales volume (average bpd) (for
period owned) (2) |
|
82,964 |
|
|
80,536 |
|
|
85,339 |
|
|
79,165 |
|
Terminalling throughputs (average bpd) (3) |
|
156,922 |
|
|
162,383 |
|
|
154,643 |
|
|
154,917 |
|
(1) Excludes jet fuel and petroleum coke.
(2) Throughputs for the six months ended
June 30, 2018 are for the 122 days we marketed certain
finished products produced at or sold from the Big Spring Refinery
following the execution of the Big Spring Marketing Agreement,
effective March 1, 2018.
(3) Consists of terminalling throughputs at our
Tyler, Big Spring, Big Sandy and Mount Pleasant, Texas, our El
Dorado and North Little Rock, Arkansas and our Memphis and
Nashville, Tennessee terminals. Throughputs for the Big Spring
terminal are for the 122 days we operated the terminal following
its acquisition effective March 1, 2018. Barrels per day are
calculated for only the days we operated each terminal. Total
throughput for the six months ended June 30, 2018 was 26.0
million barrels, which averaged 143,593 barrels per day for the
period.
|
|
|
|
|
Retail
Segment |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
(Unaudited) |
|
(Unaudited) |
Number of stores (end of
period) |
|
263 |
|
|
297 |
|
|
263 |
|
|
297 |
|
Average number of stores |
|
277 |
|
|
297 |
|
|
279 |
|
|
298 |
|
Retail fuel sales (thousands
of gallons) |
|
53,743 |
|
|
54,114 |
|
|
107,633 |
|
|
107,813 |
|
Average retail gallons per
average number of stores (in thousands) |
|
201 |
|
|
188 |
|
|
399 |
|
|
373 |
|
Retail fuel margin ($ per gallon) (1) |
|
$ |
0.29 |
|
|
$ |
0.24 |
|
|
$ |
0.25 |
|
|
$ |
0.21 |
|
Merchandise sales (in
millions) |
|
$ |
83.3 |
|
|
$ |
90.2 |
|
|
$ |
158.6 |
|
|
$ |
168.3 |
|
Merchandise sales per average
number of stores (in millions) |
|
$ |
0.3 |
|
|
$ |
0.3 |
|
|
$ |
0.6 |
|
|
$ |
0.6 |
|
Merchandise margin % |
|
31.2 |
% |
|
31.7 |
% |
|
31.1 |
% |
|
31.0 |
% |
Change in same-store fuel
gallons sold (2) |
|
1.7 |
% |
|
— |
% |
|
3.1 |
% |
|
— |
% |
Change in same-store
merchandise sales(2) |
|
(2.5 |
)% |
|
— |
% |
|
(0.5 |
)% |
|
— |
% |
(1) Retail fuel margin represents
gross margin on fuel sales in the retail segment, and is calculated
as retail fuel sales revenue less retail fuel cost of sales. The
retail fuel margin per gallon calculation is derived by dividing
retail fuel margin by the total retail fuel gallons sold for the
period.
(2) Same-store comparisons include
period-over-period increases or decreases in specified metrics for
stores that were in service at both the beginning of the earliest
period and the end of the most recent period used in the
comparison.
|
|
|
|
|
|
|
|
|
Delek US Holdings,
Inc. |
|
|
|
|
|
|
|
|
Reconciliation of
Amounts Reported Under U.S. GAAP |
|
|
|
|
|
|
|
|
$ in
millions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
Reconciliation of Net Income (Loss) attributable to Delek
to Adjusted Net Income |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Reported net income attributable to Delek |
|
$ |
77.3 |
|
|
$ |
79.1 |
|
|
$ |
226.6 |
|
|
$ |
38.7 |
|
|
|
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
Net inventory valuation loss
(benefit) |
|
0.6 |
|
|
(1.0 |
) |
|
(51.5 |
) |
|
(1.9 |
) |
Tax effect of inventory
valuation |
|
(0.1 |
) |
|
0.2 |
|
|
11.2 |
|
|
0.4 |
|
Net after tax inventory
valuation loss (benefit) |
|
0.5 |
|
|
(0.8 |
) |
|
(40.3 |
) |
|
(1.5 |
) |
|
|
|
|
|
|
|
|
|
Adjusted unrealized hedging
loss (gain) |
|
8.5 |
|
|
(2.4 |
) |
|
21.8 |
|
|
5.4 |
|
Tax effect of adjusted
unrealized hedging |
|
(1.9 |
) |
|
0.5 |
|
|
(4.9 |
) |
|
(1.2 |
) |
Net after tax adjusted
unrealized hedging loss (gain) |
|
6.6 |
|
|
(1.9 |
) |
|
16.9 |
|
|
4.2 |
|
|
|
|
|
|
|
|
|
|
Transaction related
expenses |
|
0.3 |
|
|
2.6 |
|
|
3.3 |
|
|
13.2 |
|
Tax effect of transaction
related expenses |
|
(0.1 |
) |
|
(0.6 |
) |
|
(0.7 |
) |
|
(2.8 |
) |
Net after tax transaction
related expenses |
|
0.2 |
|
|
2.0 |
|
|
2.6 |
|
|
10.4 |
|
|
|
|
|
|
|
|
|
|
Tax Cuts and Jobs Act
adjustment |
|
— |
|
|
10.0 |
|
|
— |
|
|
2.6 |
|
Net after tax Tax Cuts and
Jobs Act adjustment |
|
— |
|
|
10.0 |
|
|
— |
|
|
2.6 |
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment of
debt |
|
— |
|
|
— |
|
|
— |
|
|
9.0 |
|
Tax effect of loss on
extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
(2.1 |
) |
Net after tax loss on
extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
6.9 |
|
|
|
|
|
|
|
|
|
|
Impairment loss on assets held
for sale |
|
— |
|
|
— |
|
|
— |
|
|
27.5 |
|
Tax effect of impairment loss
on assets held for sale |
|
— |
|
|
— |
|
|
— |
|
|
(0.5 |
) |
Net after tax impairment loss
on assets held for sale |
|
— |
|
|
— |
|
|
— |
|
|
27.0 |
|
|
|
|
|
|
|
|
|
|
Gain on sale of the asphalt
business |
|
— |
|
|
(13.2 |
) |
|
— |
|
|
(13.2 |
) |
Tax effect of gain on sale of
the asphalt business |
|
— |
|
|
2.9 |
|
|
— |
|
|
2.9 |
|
Net after tax gain on sale of
the asphalt business |
|
— |
|
|
(10.3 |
) |
|
— |
|
|
(10.3 |
) |
|
|
|
|
|
|
|
|
|
Non-operating, pre-acquisition
litigation contingent losses and related legal expenses |
|
6.7 |
|
|
— |
|
|
6.7 |
|
|
— |
|
Tax effect of non-operating
pre-acquisition litigation contingent losses and related legal
expenses |
|
(1.5 |
) |
|
— |
|
|
(1.5 |
) |
|
— |
|
Net after tax non-operating
pre-acquisition litigation contingent losses and related legal
expenses |
|
5.2 |
|
|
— |
|
|
5.2 |
|
|
— |
|
|
|
|
|
|
|
|
|
|
Discontinued operations
loss |
|
1.0 |
|
|
1.0 |
|
|
1.0 |
|
|
11.5 |
|
Tax effect of discontinued
operations |
|
(0.2 |
) |
|
(0.2 |
) |
|
(0.2 |
) |
|
(2.5 |
) |
Net after tax discontinued
operations loss |
|
0.8 |
|
|
0.8 |
|
|
0.8 |
|
|
9.0 |
|
|
|
|
|
|
|
|
|
|
Income attributable to
non-controlling interest of discontinued operations |
|
— |
|
|
— |
|
|
— |
|
|
10.5 |
|
Tax effect of income
attributable to non-controlling interest of discontinued
operations |
|
— |
|
|
— |
|
|
— |
|
|
(2.4 |
) |
Net after tax income
attributable to non-controlling interest of discontinued
operations |
|
— |
|
|
— |
|
|
— |
|
|
8.1 |
|
|
|
|
|
|
|
|
|
|
Tax adjustment related to
unrealizable deferred taxes created in Big Spring Asset
Acquisition |
|
— |
|
|
— |
|
|
— |
|
|
5.5 |
|
|
|
|
|
|
|
|
|
|
Total after tax adjustments |
|
13.3 |
|
|
(0.2 |
) |
|
(14.8 |
) |
|
61.9 |
|
|
|
|
|
|
|
|
|
|
Adjusted net income |
|
$ |
90.6 |
|
|
$ |
78.9 |
|
|
$ |
211.8 |
|
|
$ |
100.6 |
|
|
|
|
|
|
|
|
|
|
Delek US Holdings,
Inc. |
|
|
|
|
|
|
|
|
Reconciliation of
Amounts Reported Under U.S. GAAP |
|
|
|
|
|
|
|
|
per share
data |
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
Reconciliation of U.S. GAAP Income (Loss) per share to
Adjusted Net Income per share |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
Reported diluted income per share |
|
$ |
1.00 |
|
|
$ |
0.89 |
|
|
$ |
2.91 |
|
|
$ |
0.45 |
|
|
|
|
|
|
|
|
|
|
Adjustments, after tax
(per share) (1) |
|
|
|
|
|
|
|
|
Net inventory valuation loss
(gain) |
|
0.01 |
|
|
(0.01 |
) |
|
(0.52 |
) |
|
(0.02 |
) |
Adjusted unrealized hedging
loss (gain) |
|
0.08 |
|
|
(0.02 |
) |
|
0.22 |
|
|
0.05 |
|
Transaction related
expenses |
|
— |
|
|
0.02 |
|
|
0.03 |
|
|
0.12 |
|
Tax Cuts and Jobs Act
adjustment |
|
— |
|
|
0.11 |
|
|
— |
|
|
0.03 |
|
Impairment loss on assets held
for sale |
|
— |
|
|
— |
|
|
— |
|
|
0.31 |
|
Gain on sale of the asphalt
business |
|
— |
|
|
(0.11 |
) |
|
— |
|
|
(0.12 |
) |
Loss on extinguishment of
debt |
|
— |
|
|
— |
|
|
— |
|
|
0.08 |
|
Non-operating, pre-acquisition
litigation contingent losses and related legal expenses |
|
0.07 |
|
|
— |
|
|
0.07 |
|
|
— |
|
Discontinued operations
loss |
|
0.01 |
|
|
0.01 |
|
|
0.01 |
|
|
0.10 |
|
Net income attributable to
non-controlling interest of discontinued operations |
|
— |
|
|
— |
|
|
— |
|
|
0.09 |
|
Tax adjustment related to
unrealizable deferred taxes created in Big Spring Asset
Acquisition |
|
— |
|
|
— |
|
|
— |
|
|
0.06 |
|
|
|
|
|
|
|
|
|
|
Total adjustments |
|
0.17 |
|
|
— |
|
|
(0.19 |
) |
|
0.72 |
|
Adjustment for economic
benefit of note hedge related to Senior Convertible Notes |
|
— |
|
|
0.03 |
|
|
— |
|
|
— |
|
Adjusted net income per share |
|
$ |
1.17 |
|
|
$ |
0.92 |
|
|
$ |
2.72 |
|
|
$ |
1.17 |
|
(1) The tax calculation is based on the
appropriate marginal income tax rate related to each adjustment and
for each respective time period, which is applied to the adjusted
items in the calculation of adjusted net income in all periods.
|
|
|
|
|
|
|
|
|
Delek US Holdings,
Inc. |
|
|
|
|
|
|
|
|
Reconciliation of
Amounts Reported Under U.S. GAAP |
|
|
|
|
|
|
|
|
$ in
millions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
Reconciliation of Net
Income attributable to Delek to Adjusted EBITDA |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Reported net income attributable to Delek |
|
$ |
77.3 |
|
|
$ |
79.1 |
|
|
$ |
226.6 |
|
|
$ |
38.7 |
|
|
|
|
|
|
|
|
|
|
Add: |
|
|
|
|
|
|
|
|
Interest expense, net |
|
29.5 |
|
|
30.6 |
|
|
55.7 |
|
|
62.4 |
|
Loss on extinguishment of
debt |
|
— |
|
|
— |
|
|
— |
|
|
9.0 |
|
Income tax expense -
continuing operations |
|
24.6 |
|
|
32.8 |
|
|
70.4 |
|
|
21.3 |
|
Depreciation and
amortization |
|
50.1 |
|
|
49.2 |
|
|
96.9 |
|
|
97.2 |
|
EBITDA |
|
181.5 |
|
|
191.7 |
|
|
449.6 |
|
|
228.6 |
|
|
|
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
Net inventory valuation loss
(gain) |
|
0.6 |
|
|
(1.0 |
) |
|
(51.5 |
) |
|
(1.9 |
) |
Adjusted unrealized hedging
loss (gain) |
|
8.5 |
|
|
(2.4 |
) |
|
21.8 |
|
|
5.4 |
|
Transaction related
expenses |
|
0.3 |
|
|
2.6 |
|
|
3.3 |
|
|
13.2 |
|
Impairment loss on assets held
for sale |
|
— |
|
|
— |
|
|
— |
|
|
27.5 |
|
Gain on sale of the asphalt
business |
|
— |
|
|
(13.2 |
) |
|
— |
|
|
(13.2 |
) |
Non-operating, pre-acquisition
litigation contingent losses and related legal expenses |
|
6.7 |
|
|
— |
|
|
6.7 |
|
|
— |
|
Discontinued operations loss,
net of tax |
|
0.8 |
|
|
0.8 |
|
|
0.8 |
|
|
9.0 |
|
Net income attributable to
non-controlling interest |
|
6.5 |
|
|
7.6 |
|
|
11.6 |
|
|
22.5 |
|
Total adjustments |
|
23.4 |
|
|
(5.6 |
) |
|
(7.3 |
) |
|
62.5 |
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA |
|
$ |
204.9 |
|
|
$ |
186.1 |
|
|
$ |
442.3 |
|
|
$ |
291.1 |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
Reconciliation of Refining Segment Gross Margin to Refining
Margin |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
(Unaudited) |
(Unaudited) |
Net revenues |
|
$ |
2,367.8 |
|
|
$ |
2,543.2 |
|
|
$ |
4,459.8 |
|
|
$ |
4,669.1 |
|
Cost of sales |
|
2,222.7 |
|
|
2,399.3 |
|
|
4,051.5 |
|
|
4,424.1 |
|
Gross margin |
|
145.1 |
|
|
143.9 |
|
|
408.3 |
|
|
245.0 |
|
Add back (items included in
cost of sales): |
|
|
|
|
|
|
|
|
Operating expenses (excluding
depreciation and amortization) |
|
115.0 |
|
|
113.2 |
|
|
236.0 |
|
|
227.9 |
|
Depreciation and
amortization |
|
33.2 |
|
|
33.1 |
|
|
64.3 |
|
|
65.3 |
|
Refining margin |
|
$ |
293.3 |
|
|
$ |
290.2 |
|
|
$ |
708.6 |
|
|
$ |
538.2 |
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
Reconciliation of Unrealized (Gains) Losses on Economic
Hedge Commodity Derivatives Not Designated as Hedges to Adjusted
Unrealized Hedging (Gains) Losses |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
(Unaudited) |
Unrealized loss on economic hedge commodity derivatives not
designated as hedges |
|
$ |
3.6 |
|
|
$ |
9.9 |
|
|
$ |
30.7 |
|
|
$ |
24.7 |
|
Reversal of prior period
unrealized gain where the instrument has matured but has not cash
settled as of period end |
|
5.6 |
|
|
2.4 |
|
|
(8.1 |
) |
|
(4.6 |
) |
Removal of portion of
unrealized loss where the instrument has matured but has not cash
settled as of period end |
|
(0.8 |
) |
|
(14.7 |
) |
|
(0.8 |
) |
|
(14.7 |
) |
Adjusted unrealized hedging
losses (gains) |
|
$ |
8.4 |
|
|
$ |
(2.4 |
) |
|
$ |
21.8 |
|
|
$ |
5.4 |
|
Investor / Media Relations Contact:Blake
Fernandez, Senior Vice President of Investor Relations and Market
Intelligence, 615-224-1312
Keith Johnson, Vice President of Investor Relations,
615-435-1366
Media/Public Affairs Contact:Michael P. Ralsky,
Vice President - Government Affairs, Public Affairs &
Communications, 615-435-1407
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