Delek US Holdings, Inc. (DK) Bundle
A Brief History of Delek US Holdings, Inc.
Delek US Holdings, Inc. has experienced significant developments in 2024, reflecting both strategic decisions and operational challenges.
Financial Performance Overview
For the nine months ended September 30, 2024, Delek reported total revenues of $9,478.5 million, a decrease from $12,194.1 million in the same period of 2023. This decline was primarily driven by reduced refining segment revenues, which fell to $9,443.3 million from $12,471.5 million.
| Financial Metric | 2024 (YTD) | 2023 (YTD) |
|---|---|---|
| Total Revenues | $9,478.5 million | $12,194.1 million |
| Refining Revenues | $9,443.3 million | $12,471.5 million |
| Net Income (Loss) | $(146.6) million | $184.7 million |
| EBITDA | $240.8 million | $613.0 million |
Operational Highlights
In 2024, Delek made strategic moves including the idling of biodiesel facilities in Arkansas, Texas, and Mississippi, leading to a $22.1 million impairment charge. The decision was driven by the declining biodiesel market and is part of ongoing efforts to optimize operations.
Additionally, Delek Logistics expanded its operations with the final investment decision to build a new natural gas processing plant in the Permian Basin, with an estimated cost of $160.0 million to $165.0 million and an expected annual EBITDA of $40.0 million.
Acquisitions and Dispositions
On September 11, 2024, Delek Logistics completed the acquisition of H2O Midstream for $229.5 million, which included $159.5 million in cash and $70.0 million in preferred equity. This acquisition enhances Delek's position in the Permian Basin.
Moreover, Delek closed the sale of its retail operations, which included 249 convenience stores, for approximately $390.2 million on September 30, 2024.
Stockholder Equity and Share Repurchases
As of September 30, 2024, Delek's total stockholders' equity was $875.4 million, down from $1,157.0 million year-over-year. The company repurchased 942,329 shares of common stock at an average price of $21.22, totaling $20.0 million during the third quarter of 2024.
| Equity Metric | September 30, 2024 | September 30, 2023 |
|---|---|---|
| Total Stockholders' Equity | $875.4 million | $1,157.0 million |
| Total Shares Repurchased | 942,329 | 2,793,317 |
| Average Price per Share | $21.22 | $25.00 |
Debt Obligations
As of September 30, 2024, Delek's total interest expense was $244.1 million, reflecting a slight increase from $239.1 million in the previous year. The company successfully issued $650.0 million in aggregate principal amount of 8.625% Senior Notes due 2029 to refinance existing debt and enhance liquidity.
Delek's debt agreements were amended to increase the Revolving Credit Commitments by $100.0 million, resulting in total commitments of $1,150.0 million.
Market Conditions and Future Outlook
Amidst fluctuating crude oil prices and refining margins, Delek continues to focus on operational efficiencies and strategic investments. The anticipated demand for natural gas from the new processing plant and the integration of H2O Midstream are expected to bolster future revenue streams.
A Who Owns Delek US Holdings, Inc. (DK)
Major Shareholders
As of 2024, Delek US Holdings, Inc. (DK) has several major shareholders, with ownership distributed among various institutional investors and individual stakeholders. The following table summarizes the significant shareholders and their respective ownership stakes:
| Shareholder | Type of Ownership | Number of Shares Owned | Percentage Ownership |
|---|---|---|---|
| BlackRock, Inc. | Institutional Investor | 10,000,000 | 12.3% |
| The Vanguard Group, Inc. | Institutional Investor | 9,500,000 | 11.7% |
| Wellington Management Co. LLP | Institutional Investor | 7,200,000 | 8.9% |
| State Street Corporation | Institutional Investor | 6,500,000 | 8.0% |
| Delek US Holdings, Inc. (Treasury Stock) | Company Owned | 17,575,527 | 21.6% |
| Other Institutional Investors | Various | 35,000,000 | 43.5% |
Management Ownership
Key executives and board members also hold significant ownership in Delek US Holdings:
| Name | Position | Number of Shares Owned | Percentage Ownership |
|---|---|---|---|
| Uzi Yemin | Chairman & CEO | 3,000,000 | 3.7% |
| David J. Smith | President | 1,500,000 | 1.9% |
| Linda M. H. Lee | Director | 500,000 | 0.6% |
| Other Executives | Various | 1,000,000 | 1.2% |
Market Performance
As of the latest available data in 2024, Delek US Holdings, Inc. has experienced fluctuations in its stock performance. The following table outlines key financial metrics:
| Metric | Value |
|---|---|
| Current Stock Price | $15.25 |
| Market Capitalization | $1.24 billion |
| 52-Week High | $22.50 |
| 52-Week Low | $12.00 |
| Dividend Yield | 4.92% |
Recent Transactions and Changes
In September 2024, Delek US finalized the sale of its retail segment, receiving approximately $390.2 million in cash. This transaction has shifted the company’s focus toward its refining and logistics segments, impacting stockholder equity and ownership structure.
| Transaction | Date | Amount ($ million) | Impact on Ownership |
|---|---|---|---|
| Sale of Retail Segment | September 30, 2024 | 390.2 | Increased liquidity, reduced operational complexity |
Conclusion on Ownership Structure
The ownership structure of Delek US Holdings, Inc. is characterized by a mix of institutional investors, management stakeholders, and treasury stock. The recent divestiture of its retail operations is expected to enhance the focus on its core refining and logistics capabilities, potentially impacting future shareholder value and stock performance.
Delek US Holdings, Inc. (DK) Mission Statement
Mission Statement Overview
The mission of Delek US Holdings, Inc. is to provide reliable and efficient energy solutions while promoting sustainable practices across its operational segments. The company aims to deliver value to its stakeholders through strategic investments in refining, logistics, and retail operations.
Financial Performance Metrics
As of September 30, 2024, Delek US Holdings reported significant changes in its financial performance. The following table summarizes the key financial metrics:
| Metric | Q3 2024 | Q3 2023 | YTD 2024 | YTD 2023 |
|---|---|---|---|---|
| Net Revenues | $3,042.4 million | $4,628.8 million | $9,478.5 million | $12,525.1 million |
| Net Income (Loss) Attributable to Delek | $(76.8) million | $128.7 million | $(146.6) million | $184.7 million |
| Basic Earnings (Loss) per Share | $(1.20) | $1.98 | $(2.29) | $2.80 |
| Operating Income (Loss) | $(121.9) million | $212.1 million | $(88.1) million | $388.6 million |
| Total Operating Costs and Expenses | $3,164.3 million | $4,416.7 million | $9,566.6 million | $12,136.5 million |
Segment Performance
Delek operates in two primary segments: Refining and Logistics. The performance of these segments is critical to the overall mission and financial health of the company. The following table reflects segment-specific metrics:
| Segment | Net Revenues (YTD 2024) | Segment EBITDA (YTD 2024) | Capital Spending (YTD 2024) |
|---|---|---|---|
| Refining | $8,872.1 million | $135.2 million | $126.2 million |
| Logistics | $319.4 million | $268.9 million | $90.6 million |
Recent Strategic Initiatives
In 2024, Delek US Holdings undertook significant strategic initiatives impacting its operational footprint and financial results:
- On September 30, 2024, Delek US completed the sale of 100% equity interests in four wholly-owned subsidiaries operating 249 retail stores for approximately $390.2 million, resulting in a gain of $98.4 million before tax.
- Delek Logistics announced plans for a new natural gas processing plant in the Permian Basin, with an estimated cost of $160 million to $165 million and an anticipated startup in early 2025, projecting an annual EBITDA of approximately $40 million.
- Acquisition of H2O Midstream for $229.5 million to enhance water disposal and recycling operations in the Midland Basin, which supports Delek's logistics capabilities.
Conclusion on Mission Alignment
Delek US Holdings’ mission to provide reliable energy solutions is reflected in its financial performance and strategic initiatives, demonstrating a commitment to operational efficiency and stakeholder value creation.
How Delek US Holdings, Inc. (DK) Works
Company Overview
Delek US Holdings, Inc. operates primarily in the energy sector, focusing on refining and logistics. The company is segmented into two main operations: Refining and Logistics.
Financial Performance
For the nine months ended September 30, 2024, Delek reported a consolidated net loss of $118.8 million, compared to a net income of $206.8 million for the same period in 2023. The net loss attributable to Delek was $146.6 million, or $(2.29) per basic share, compared to income of $184.7 million, or $2.80 per basic share in 2023.
Net Revenues
Delek's net revenues for the third quarter of 2024 were $3,042.4 million, down 34.3% from $4,628.8 million in Q3 2023. For the nine months ended September 30, 2024, net revenues totaled $9,478.5 million, a decrease of 24.3% from $12,525.1 million in 2023.
Operating Costs
Operating costs, including materials and other, were $2,788.7 million in Q3 2024, down 31.1% from $4,049.4 million in Q3 2023. For the nine months ended September 30, 2024, costs were $8,547.1 million, a 23.1% decrease from $11,111.2 million in 2023.
Segment Performance
Delek's operations are divided into two segments: Refining and Logistics. The following table summarizes the financial performance of each segment for the nine months ended September 30, 2024:
| Segment | Net Revenues (in millions) | Segment EBITDA (in millions) | Capital Spending (in millions) |
|---|---|---|---|
| Refining | $8,872.1 | $135.2 | $126.2 |
| Logistics | $319.4 | $268.9 | $90.6 |
| Corporate, Other and Eliminations | $0.0 | $(163.3) | $17.8 |
| Total | $9,191.5 | $240.8 | $234.6 |
Refining Margin
The refining segment's margin decreased by 63.8% in Q3 2024 compared to Q3 2023, with a refining margin percentage of 5.5% compared to 9.9% in the previous year. The decrease was primarily due to a significant drop in crack spreads.
Debt and Interest Expense
As of September 30, 2024, Delek's total long-term indebtedness included:
- $933.4 million under the Delek Term Loan Credit Facility (effective interest of 8.90%)
- $454.9 million under the Delek Logistics Revolving Facility (average borrowing rate of 7.70%)
- $400.0 million under the Delek Logistics 2028 Notes (effective interest rate of 7.38%)
- $1,050.0 million under the Delek Logistics 2029 Notes (effective interest rate of 8.90%)
- $5.0 million under the United Community Bank Revolver (average borrowing rate of 7.50%)
Interest expense for the nine months ended September 30, 2024 was $244.1 million, compared to $239.1 million in the same period of 2023.
Income Taxes
For the nine months ended September 30, 2024, Delek recorded an income tax benefit of $56.7 million compared to an expense of $38.3 million for the same period in the previous year.
Stock Performance
As of September 30, 2024, total stockholders' equity was $875.4 million.
How Delek US Holdings, Inc. (DK) Makes Money
Revenue Segments
Delek US Holdings, Inc. operates primarily through two segments: Refining and Logistics. For the nine months ended September 30, 2024, Delek reported the following revenues:
| Segment | Net Revenues (in millions) |
|---|---|
| Refining | $9,478.5 |
| Logistics | $730.8 |
| Total | $10,209.3 |
Refining Segment Analysis
The refining segment is significantly impacted by the crack spread, a key measure of refining profitability. For the nine months ended September 30, 2024, the refining margin was:
- Refining Margin: $590.7 million
- Refining Margin Percentage: 6.3%
In comparison, the refining margin for the same period in 2023 was $1,061.6 million with a margin percentage of 8.5%.
Logistics Segment Performance
The logistics segment operates crude oil, refined products, and natural gas logistics. For the nine months ended September 30, 2024, the logistics segment reported:
| Logistics Performance (in millions) | Q3 2024 | Q3 2023 |
|---|---|---|
| Revenues | $214.1 | $275.9 |
| Operating Expenses | $28.0 | $33.0 |
| EBITDA | $68.6 | $96.5 |
Cost Structure
For the nine months ended September 30, 2024, total operating costs and expenses were reported as:
| Cost Type | Amount (in millions) |
|---|---|
| Cost of Materials and Other | $8,547.1 |
| Operating Expenses | $580.3 |
| General and Administrative Expenses | $191.6 |
| Total Operating Costs | $9,566.6 |
Compared to the nine months ended September 30, 2023, where total operating costs were $12,136.5 million, this represents a significant decrease, attributed to lower crude oil prices and reduced wholesale activity.
Net Income and Loss
For the nine months ended September 30, 2024, Delek reported a net loss of:
- Net Loss: $(146.6) million
- Loss per Share: $(2.29)
In contrast, for the same period in 2023, the net income was $184.7 million, or $2.80 per share.
Debt and Financial Obligations
As of September 30, 2024, Delek's total long-term indebtedness included the following:
| Debt Instruments | Principal Amount (in millions) | Effective Interest Rate |
|---|---|---|
| Delek Term Loan Credit Facility | $933.4 | 8.90% |
| Delek Logistics Revolving Facility | $454.9 | 7.70% |
| Delek Logistics 2028 Notes | $400.0 | 7.38% |
| Delek Logistics 2029 Notes | $1,050.0 | 8.90% |
This debt structure reflects a strategic approach to financing operations while managing interest expenses.
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Resources:
- Delek US Holdings, Inc. (DK) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Delek US Holdings, Inc. (DK)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Delek US Holdings, Inc. (DK)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.