DKL - Earnings call 4 2023 | Delek Logistics Partners, LP

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Operator

Good morning, ladies and gentlemen, and welcome to the Delek Logistics Partners' Fourth Quarter 2023 Conference Call. [Operator Instructions] This call is being recorded on Tuesday, February 27, 2024.

I would now like to hand the conference over to Rosy Zuklic, VP of Investor Relations. Please go ahead.

Rosy Zuklic

Good day, and welcome to the Delek Logistics Partners fourth quarter earnings conference call. Participants on today's call will include Avigal Soreq, President; Joseph Israel, EVP, Operations; Reuven Spiegel, EVP and Chief Financial Officer; and Odely Sakazi, SVP, Delek Logistics.

risks conference federal contain limitation, differ securities -- statements this defined statements statements from reminder, may these the that under laws, involve our a forecast. call results forward-looking will as regarding cause As actual uncertainties to and including without

release For please filed with quarterly and report which the Form XX-Q refer with respective risk the their along discussed in associated XX-K more most on dates. recently The as speak any press no Form the call. information, with the SEC, to partnership's of obligation information filed forward-looking to partnership factors annual this report on or statements assumes update

I'll over remarks. Avigal now opening the for to call turn

Avigal Soreq

in record $XXX years Thank I'm year. a very operations a and connection you, our It our Rosy. in our Logistics million substantial finished new in Delek team quarter. and another and without mid time making DKL to growth dedicated possible. of quarter record the Partners We exceeds that our Permian are safe X row results a Delek succeed. dedication XXXX their EBITDA delivered gone adjusted makes strong gathering this is injury achieved The our Basin. reliable position employees in saw validating to from We further operation Logistics a has who and counting. strong. lost proud

our to delivering a record Basin January, exploring our to feel shown $X.XXX disciplined We are maintain where a and XXth in . In We competitive Logistics track ability significant Delek also the distribution focused see growth. in approved unitholders. the to manner increase capital has third-party on consecutive the gas allocating confident we value opportunities of growing per unit. natural investors. strong Board revenues in Delaware

over it hand now Reuven. to will I

Reuven Spiegel

a which The EBITDA $XX.X assets. driven XXXX XXXX. $XX.X The of impairment significant rates. in Delaware some a processing million, fourth primarily $XXX.X you, related interest impairment in with quarter The Thank million fourth was compared goodwill was period $XX.X million adjusted to increase same quarter included of our was million and EBITDA the of by Gathering Avigal.

the Delaware unchanged. of Gathering System outlook long-term Our remains

was flow X.X%. million DCF was coverage ratio cash Distributable the $XX and

EBITDA $XX.X with Gathering in 'XX. quarter and The Logistics Processing million fourth the was to from for compared quarter was the Premium $XX.X higher assets. segment, Delek For adjusted increase Basin million primarily due throughput the of

utilization. and increase year. with Terminalling compared Marketing prior fourth of EBITDA in $XX.X from was Wholesale adjusted was the $XX.X The in quarter million terminal and primarily XXXX higher million

the was $XX.X adjusted million in storage quarter Storage rates. by 'XX. higher transportation driven to and Transportation million compared of $XX.X The the was and EBITDA in fourth increase quarter mainly

this And lastly, in joint the compared with contributed quarter million $X.X quarter pipeline fourth venture segment investment of in 'XX. million the $X

for Midland gathering includes capital growth year of projects. expenditures. the in systems. capital connections namely to $XX million the new for to growth proceeds from producers million. $X program Most was The projects, the throughout advancing This and on Moving of was 'XX partially Delaware fund spend

includes This the For to million and capital $XX be of regulatory XXXX, capital capital. and Partners million. growth $XX $XX approximately Delek program expects Logistics million about sustaining of

will volume the partnership. connection for the gathering to new at our We continue in growth system advance

that, open for can With call we questions. the

Operator

Doug first Irwin Instructions] question [Operator from Your comes from Citi.

Douglas Irwin

term? with they these when assets the initial expectations $XXX number when tax. want target X how annual long-term Can the the Delaware versus assets that just about Is are is I a for here acquired today just you -- the good maybe assets. the outlook I EBITDA. million start work is acquired of Understanding talk to the processing and Bear just think still Gathering with near trending you on initial still to

Avigal Soreq

expectation. X Bear, for Avigal. it's the you our call. joining Doug, meeting DDG our Generally speaking, Thank is now

in is there probably us opportunity prepared see picked over and insight for on up mainly in there as And being my that you remarks, opportunities additional also gas. more the area, give on region. we We natural the

So it. that good to was position get a into very

Douglas Irwin

And broader just on 'XX a it. just second the Okay. question outlook. then Got

You 'XX? about volume run exiting you quarterly targets kind last there 'XX of Are talked the this EBITDA just outlook -- some whether you at gave frame million or other forward, that's any quarter, help to to point achieved which on $XXX similar can growth you metric, for quarter. rate, EBITDA, moving growth

Avigal Soreq

Yes.

have keep So our we a to and committed are -- business. improving constant improvement, we are to focusing

a into and So we constant opportunities. seen the very are see business business. opportunity we see improvement plan nice But optimistic will very about we CapEx we consistent on additional the are that in optimistic, what the in have a business significant and the we enhance

So to be can what that's going provide we

Operator

are from I have [Operator Instructions] Longo questions at no do more this I apologize, Paul turn will There Lord question, we further time. one Abbett. -- from

Unknown Analyst

bit little I was looked the curious, volumes sequentially. were Midland it down a like

Delaware And water were down sequentially. the and the bit volumes some little gas the and of a

me to that? if that that. -- is continue? we trend missed Forgive What was expect should I why And

Avigal Soreq

Yes.

joining line beginning know as see good The high the Permian as and the Basin in new the in What very pretty the our is a to stabilize quarter-over-quarter. that over after anyone producers that that for adding gathering production, you production you are us expect then lower. time. new we you thank So can touch volume today. goes probably much And in

we So that's see. what

you Midland to and budget As you in significant add enhance capital along VPG, probably will volume up will a the to up, see connection the year. Odely, volume additional picked and that? picked we that anything have area, we do want the

Odely Sakazi

early just do of sure. plan mentioned. color we actually QX, it helped QX, is to more the In that's little bit a on continue our improving Delaware expedited volumes. decided side I us to in this from that work and some Odely. Avigal in we as give do QX Yes, maintenance And to

in sides, both if of QX if year. DDG between look is and So year-over-year, slightly lower we But also this both why compare improve our to this QX you see gas, on and you performance. obviously DPG continue you to social compared in

to that expedited we're also in there it QX, and in work right we was QX, already But to we the looking now as was plan. for that an So planning work the is QX. primarily, both improvement QX had on done most compared that

Unknown Analyst

And that and both Midland for improvement is Delaware?

Odely Sakazi

Primarily, the Delaware is Midland.

program, connection. As we remarks, we also compared said, to in in Avigal Avigal mentioned, do Reuven have QX. seen natural the we've With mentioned a the the compared in or business volumes of million on mentioned, decline see peak that the $XX capital his as do to

an the as this project. to in increment So see second the year start we increase Permian should half we of

Unknown Analyst

expenses then corporate little bit I sequentially. bit? And were that down noticed little about a you Could Great. talk Okay. a

Avigal Soreq

We So it's the target of $XXX had million. it's we company streamline parent expenses, a to across big the to doing on initiative recorded the with reduce effort an expenses. company -- zero-based a are budget

went to DKL. the Some all of way that

to see our you So partnership.

you of that. see So the fruits

So it here, we them. but to beamboard didn't on put happy the we were enjoy

Unknown Analyst

Great. Okay.

should we stabilize expenses continue even forward? kind to maybe going to of or So improve expect

Avigal Soreq

will think is giving Yes. don't I back. it we there are go guidance, no but reason

Unknown Analyst

coming debt those time? a Any Okay. in And this thoughts at up then 'XX. in point have on maturities few you

Avigal Soreq

Yes, Director. Reuven absolutely. Maybe

Reuven Spiegel

Yes.

We are actively instruments. various examining

the refinance between the in the yield. market some We billion loan and import term will the be of in $XXX next months probably few the to

happen So some year. form of refinancing will this

Unknown Analyst

the of much question, you to say can -- parts and leverage of at of kind Are probably thoughts that at that? strategic. your on it. there And subject? able last won't my then And you as on But that, you look Great. too part DKL? ways the there as what Anything could that sum is the Okay. be say improved here ways are be on

Avigal Soreq

all you probably So improving seen we see can leverage that was with the ratio have quarter-over-quarter. trend the

if ideas the into there And a resolution, table, but that that's in or you pleased have our the the We leverage connect so, you dots seen market. the the level we more But this communicate will can higher on last you be with get once are continue think in trend, ratio. improvement I year with of very plan. obviously, we that

consistently are quarter We doing that after...

Unknown Analyst

on Xx? Or any should thoughts your Great. do we of think you think goal And -- that? is

Avigal Soreq

to started -- to we below are we we're and that the there. we eventually want get Yes, be going market X,

Operator

I There closing the this remarks. turn are time. Avigal to back over no further for questions will call at

Avigal Soreq

I the to table our making so of thank again great a this you. this, to much. to talk mostly next you around would Directors, and investor my to company like that we'll are our and colleagues Board Thank employees Thank quarter. our

Operator

Thank your lines. Ladies and for gentlemen, and may Thank this call your disconnect joining, now you. for conference you concludes today. you

Delek Logistics Partners (DKL) 27 Feb 242023 Q4 Earnings call transcript