Mission Statement, Vision, & Core Values (2024) of Delek Logistics Partners, LP (DKL)

An Overview of Delek Logistics Partners, LP (DKL)

General Summary of Delek Logistics Partners, LP (DKL)

Delek Logistics Partners, LP (DKL) was formed in 2012 as a master limited partnership, primarily focused on the logistics and transportation of crude oil and refined products. The company operates through four main segments: Gathering and Processing, Wholesale Marketing and Terminalling, Storage and Transportation, and Investments in Pipeline Joint Ventures. As of 2024, DKL continues to provide essential services to support the operations of Delek Holdings, Inc., its primary affiliate, while also serving third-party customers.

In 2024, DKL's operations are bolstered by significant infrastructure assets, including crude oil pipelines, refined product pipelines, and storage terminals. The partnership has strategically positioned itself in the Permian Basin and other key regions to capitalize on rising demand for oil and gas logistics services. As of 2024, DKL reported total revenues of approximately $730.8 million, reflecting its ongoing commitment to operational excellence and market responsiveness.

Company's Financial Performance in the Latest Financial Reports

For the nine months ended September 30, 2024, Delek Logistics Partners, LP reported net income attributable to partners of $107.4 million, compared to $104.1 million for the same period in 2023, representing a growth of 3.3%. The net income per limited partner unit was $2.32, consistent with the previous year's performance.

During the third quarter of 2024, net revenues decreased by $61.8 million, or 22.4%, compared to Q3 2023, primarily due to decreased volumes sold and lower average sales prices. The company’s revenue breakdown included:

DKL's operating activities generated net cash provided by operations of $156.4 million for the nine months ended September 30, 2024, compared to $110.6 million in the prior year. The total cash distribution for the quarter was $51.5 million, reflecting a 5.3% increase over the previous year's comparable quarter.

Delek Logistics Partners as a Leader in the Industry

Delek Logistics Partners, LP has established itself as a leading player in the logistics and transportation sector of the energy industry. By leveraging its extensive pipeline network and terminal facilities, DKL is well-positioned to meet the growing demands of the market. The company continues to expand its operational capabilities, exemplified by its recent acquisition of Permian Pipeline Holdings, which enhances its reach in the strategic Wink to Webster crude oil pipeline.

With a focus on sustainability and operational efficiency, Delek Logistics is committed to providing high-quality services to both its affiliate and third-party customers. The partnership's strategic investments and enhancements in infrastructure are pivotal in maintaining its competitive edge and fostering long-term growth within the energy logistics sector.

Mission Statement of Delek Logistics Partners, LP (DKL)

Mission Statement of Delek Logistics Partners, LP (DKL)

Delek Logistics Partners, LP (DKL) is committed to providing high-quality logistics and transportation services within the petroleum sector. The mission statement emphasizes the importance of operational excellence, customer satisfaction, and sustainable growth. This guiding principle is essential for aligning the company’s strategic objectives with its operational activities, ensuring long-term success in a competitive market.

Core Component 1: Operational Excellence

Operational excellence is a cornerstone of DKL's mission, reflecting its commitment to efficiency and reliability in service delivery. The company continuously invests in technology and infrastructure to enhance its operational capabilities. For instance, as of September 30, 2024, DKL's property, plant, and equipment totaled approximately $1.04 billion, demonstrating significant investments in assets that support its logistics operations.

Core Component 2: Customer Satisfaction

DKL prioritizes customer satisfaction by ensuring that its services meet or exceed industry standards. The company’s ability to fulfill approximately $1.1 billion in service revenues related to its unfulfilled performance obligations under commercial agreements showcases its dedication to maintaining strong customer relationships. Additionally, the net income attributable to partners was $107.4 million for the nine months ended September 30, 2024, reflecting the financial health necessary to support customer-focused initiatives.

Core Component 3: Sustainable Growth

Sustainable growth is integral to DKL's mission, with a focus on long-term value creation. The company reported total revenue of $766.3 million for the nine months ended September 30, 2024, highlighting its robust growth trajectory. Moreover, the recent public offerings in March and October 2024, which raised approximately $132.2 million and $165.3 million respectively, are earmarked for reducing debt and enhancing liquidity, thereby supporting sustainable business operations.

Vision Statement of Delek Logistics Partners, LP (DKL)

Vision Statement Overview

The vision statement of Delek Logistics Partners, LP (DKL) as of 2024 emphasizes the company's commitment to becoming a leading provider in the logistics sector, particularly focused on crude oil and natural gas transportation, storage, and processing. DKL aims to leverage its extensive network and operational capabilities to meet the growing energy demands while maintaining a strong focus on sustainability and efficiency.

Commitment to Sustainability

As part of its vision, Delek Logistics has committed to integrating sustainability into its operations. This includes investments in advanced technologies aimed at minimizing emissions and optimizing energy efficiency. For instance, the company is building a new natural gas processing plant in the Permian Basin with a capacity of approximately 110 MMcf/d, projected to generate an EBITDA of approximately $40 million annually.

Growth and Expansion Strategies

Delek Logistics is strategically expanding its infrastructure to enhance operational capabilities. In 2024, the company completed the acquisition of Permian Pipeline Holdings, LLC for $83.9 million, which includes a 15.6% indirect interest in the Wink to Webster pipeline. This expansion is expected to significantly increase throughput and strengthen DKL's position in the market.

Operational Excellence

DKL's vision emphasizes operational excellence through the optimization of its logistics services. The company reported net revenues of $775.4 million for the nine months ended September 30, 2024, with a focus on increasing throughput and improving service delivery. This operational focus is crucial for maintaining competitive advantage and meeting the demands of a growing customer base.

Financial Performance and Market Positioning

As of September 30, 2024, Delek Logistics had total indebtedness of $1.9 billion, reflecting its commitment to financing growth projects and acquisitions. The effective interest rates on its various notes, including 8.625% for the 2029 Notes and 7.125% for the 2028 Notes, indicate the company's proactive approach to managing its capital structure while pursuing aggressive growth strategies.

Customer and Market Engagement

In 2024, DKL's vision also includes enhancing customer engagement through comprehensive logistics services that cater to both crude oil and natural gas markets. The company has diversified its customer base significantly, with a notable increase in third-party customers due to its Delaware Gathering operations. This strategic positioning allows DKL to better serve its customers and adapt to changing market dynamics.

Core Values of Delek Logistics Partners, LP (DKL)

Integrity

The core value of integrity at Delek Logistics Partners, LP (DKL) emphasizes honesty and transparency in all business practices. This value is crucial for building trust with stakeholders and ensuring compliance with regulatory standards.

In 2024, DKL demonstrated its commitment to integrity by adhering to stringent environmental regulations and maintaining high safety standards across its operations. The Partnership is subject to extensive federal, state, and local environmental laws, which govern its operations. As a result, DKL has invested significantly in compliance measures, including the completion of regulatory maintenance projects to ensure pipeline integrity and safety.

Safety

Safety is a fundamental value that guides DKL in its operational decisions. The Partnership prioritizes the health and safety of its employees, customers, and the communities in which it operates.

As of 2024, DKL has implemented several initiatives to enhance workplace safety. For instance, it has conducted comprehensive safety training programs for all employees and invested in advanced safety equipment. Additionally, DKL reported a decrease in workplace incidents by 15% compared to the previous year, reflecting the effectiveness of these initiatives.

Excellence

The value of excellence drives DKL to pursue high performance in its services and operations. This commitment is evident in the Partnership's continuous improvement efforts and operational efficiencies.

For the nine months ended September 30, 2024, DKL's total revenue was $730.8 million, with net income attributable to partners reaching $107.4 million. This performance reflects the Partnership's focus on operational excellence and cost management, particularly in its storage and transportation segments, where operating expenses increased by only 11.9% despite rising demand.

Collaboration

Collaboration is a core value that underscores the importance of teamwork within DKL and its partnerships with stakeholders. The Partnership believes that effective collaboration leads to innovative solutions and improved service delivery.

In 2024, DKL expanded its joint ventures, notably through the acquisition of Permian Pipeline Holdings, LLC for $83.9 million, enhancing its capacity to deliver crude oil and natural gas transportation services. This acquisition is a testament to DKL's strategy of leveraging collaborative relationships to enhance operational capabilities and market reach.

Sustainability

DKL is committed to sustainability, focusing on minimizing its environmental impact while maximizing operational efficiency. This commitment is reflected in strategic investments in renewable energy and resource conservation.

In 2024, DKL made a significant investment in a new natural gas processing plant in the Permian Basin, expected to have a capacity of approximately 110 MMcf/d. This project is projected to generate an EBITDA of approximately $40 million annually, showcasing DKL's dedication to sustainable growth and environmental stewardship.

Updated on 16 Nov 2024

Resources:

1. Delek Logistics Partners, LP (DKL) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Delek Logistics Partners, LP (DKL)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Delek Logistics Partners, LP (DKL)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.