DKL - Earnings call transcript Q3 2024 | Delek Logistics Partners, LP

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Operator

Thank you for standing by. My name is Joel, and I will be your conference operator today. At this time, I would like to welcome everyone to the DKL's Third Quarter Earnings Call. [Operator Instructions].

I would now like to turn the conference over to Robert Wright, Deputy Chief Financial Officer.

begin. may You

Robert Wright

Reuven welcome Earnings and call Delek Partners SVP EVP, Logistics include Officer; Chief Good Odely and Call. to Participants Quarter Sakazi, Operations; Israel, Joseph Conference Soreq, Logistics. today's EVP joining Third and Avigal Financial morning, Delek President; the Spiegel, me will on

during that to securities risks differ statements. call outlook. regarding statements Factors guidance forward-looking uncertainties future business obligation may this As forward-looking as including a conference reminder, filings. involve materially defined laws from that could no actual results any statements cause to forward-looking today's included SEC today's statements made cause Any differ our assumes contain and update comments. will actual in company under call results The to the federal are and

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

Avigal Soreq

another you. quarter. record We Partners reported EBITDA. Logistics Thank $XXX adjusted in Delek quarterly had million approximately

with crude, In our transactions. is have continued XXXX, pleased basin, and enhanced strong recent are and Logistics closed several the we Permian of DKL in position. our gas provider natural significantly performance. Delek prolific We full-service QX actions premier important a water

X August for extend and and First, a we contracts DKL period between X, on meant of years. DK

quality portion DKL we pipeline a asset Webster premier increases and Second, packed It position. in crude enhanced permanent by of the at completed Pipeline. acquisition overall Delek the oil to DKL Wink WXW is investment-grade counterparties.

of we acquisition closed HX XX, September the on Midstream. Third,

Basin. We are combined excited the our in about offering Midland

Delaware are making our expansion complete presenting options on expect our early, and While the on customers first combination attractive we processing and and this budget is also the cross-sell In still half. it's on several in for progress time plant to is the more already expansion good opportunities. still Basin,

highly sky, is progress completion. making on the we discussed touching plant and are the previously, As

$X.XX opportunities increase gas per October the quarterly around already treatment. approved to an XX, distribution We in of Board solar Directors additional On unit. are seeing the

We and organic DKL the of opportunities, track shown to prospect delivering unitholders. Logistics. are about are strong to value Delek seeing prudent we has is approach very growth a DKL of record several inorganic taking excited and growth.

to expect grow in the will distribution and value we continue creation We on to test our forward, future. continue moving our

Reuven. now hand it will I over to

Reuven Spiegel

Thank you.

As Delek Avigal are we with liquidity growing management leverage. mentioned, prudent of Logistics and

liquidity We We $XXX currently markets. year million recent have debt liquidity the equity managed post throughout accessing have and approximately the offering. of equity by

as new plant we We on are core our processing get spending leverage gas also managing period our into expansion.

Moving on quarter third to results. our

approximately Distributable million was compared period coverage in as of approximately the $XX.X DCF was $XX adjusted, same million EBITDA adjusted million $XXX quarter and to ratio third the 'XX. The cash X.Xx. flow was

long-term realize ratio just of We expect Avigal back of benefit of X.Xx about. spoke XXXX in half the above objective second to initiatives the as steadily move we various the this our

in Webster million compared drop-down Wholesale mid-September. And from throughput with As $XX.X contributions. million in increase lastly, HXO $X.X to Basin the mainly for transaction, increase $XX.X this million the was million pipeline The compared quarter quarter segment with $XX.X which adjusted due Wink adjusted Gathering $XX.X investment rates. assets venture by in wholesale to was was year. post Permian due adjusted million decrease prior compared higher The contribution higher with and primarily of in 'XX. and in third primarily the joint transportation was quarter quarter Transportation compared lower Storage increase in was 'XX. The the closed and Marketing 'XX. was Logistics segment, contributed and the margins. the from in the The small driven Terminalling primarily was the million of $XX to quarter EBITDA Processing and storage of EBITDA third third from quarter million for Delek $XX.X $XX.X was EBITDA to million

of Midland and $XX.X Delaware allocated The million, in systems, Moving was the plant. previously $XX gas quarter capital 'XX expenditures. processing the projects, $XX.X the advancing on a our million spend expect the XXXX, capital with was announced capital we the for the remainder in growth processing second total half namely connection for quarter gathering to of million program was plant. along the on new of spend The to third which $XXX of million to to new new gas the budget in

can call With for questions. we open the that,

Operator

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

Douglas Irwin

already the you've spent processing looks over plant. I there. It the with just of CapEx to half like expected want start

talk if gas and opportunities progress need Just to DKL's gas on just updated if expectations And the take wondering about you at could curious the sour treating advantage you and sour plant ability the could any more this for talk potential the potentially timing? of Delaware? some then about in

Avigal Soreq

Yes. Doug, questions. the great Thank you, for X

plant goes well. the that of first progress So very around all,

commercial with the of very and side happy are contraction We the that.

very more progress way. going come So that's remarks, expect and absolutely put that Obviously, the you than to back around about plant? we gas right want which you heard would Odely, I this sour you my specific it in attractive. are opportunity we'll as do that about see and prepared to of sooner the later. be the way

Odely Sakazi

you. thank I Doug, And please, the Yes, question. Avigal, appreciate

is started, XXXX, everything first half a work major on projection, mentioned still perspective, well have to very of we is is very ready before, plant the from and schedule construction mentioned, on progression, the are a we going equipment as as both already civil looking well, the the progressed standpoint, from all there. has regarding which has also we So cost everything been

the about and cost. schedule it on progress happy on really also the and the we're about also So

mentioned, around us DKL. to which part but as very of have wells AGI the we're side, for more to is to continue On excited the we that that we're Avigal come the it's that, X that, and something permits we interesting, as Avigal And Triber with about the that. is opportunity sour mentioned, that's excited DPG, acquisition, looking now the about are that really use opportunity

Avigal Soreq

over Yes. you Doug, very we'll as and probably those later. sooner something see than for to there, assets that's valuation we back that you saw, a come attractive

Douglas Irwin

Great. just just a expectations you posts second about quarter. And some acreage bit more details guide a sort maybe my also maybe there. little lower question MVCs It Could of announced you is if volumes. trends would this you're moving took you was could or that on what forward step provide talk on last just be then of dedication helpful. then Midland's as And month, seeing around volume the

Avigal Soreq

Yes, absolutely.

DPG great Odely value in to we area have. is see really are that we system, accretive on the around Doug, more We location So that fortunate have the give dedication color for did deal and will the it. announced acreage extremely us, we the the we

Odely Sakazi

you, Thank Avigal. Yes.

So quarter. the timing, Doug, you the This we X of -- done we GP as we execution. kind in also, project mentioned, the before, third of mix a things. landscape. $XXX million And are saw we've consolidation is in around One, mentioned as

So of for a and our we the rigs around some optimization see producer the acreage. to also new rigs moving

of $XXX $XXX be million looking by in we million end the So DPG still year above the in around and to XXXX. are

that that in acreage an Midland that because grow in it's the excited from area we acreage we we're the able to that's DPG fact that had to area continue very the that about dedicate us is of the standpoint. just area really mentioned, are $XX,XXX As in mature like in where DPG something to a

beyond even is So million further from where see and a to volume gaining $XXX this above the incremental also well. going as an for standpoint, we're to go XXXX

Operator

Your line Truist next of question from comes Dingmann Securities. the of Neal

Neal Dingmann

questions how think X assets? You kind acquisition. that this integrate unique here. you it, will really do combination. sort X envision will again, a this? you'll have result as it the talked call upside having of, with on you midstream, of I'm the I'm incremental a envision ACO mean. wondering, much the third-party I how sort integration. just flow I little on does quicker of this guess bit a Just How wondering, And just you cash Bear of mentioned the do

Avigal Soreq

Yes.

We the goes say HXO part area our they well part partnership. the and So Logistics of HXO on built with very DPG done. of the side people over integration of team, the we system are much are can midstream Delek is the have pretty time, is that of

are integration, very the also G&A business side development operations pleased the the and both systems the on with and IT We side side. accounting the and

we we pleased obviously, and having our had bundling more we For give on are example, and new discussion a their really it. in yesterday, this the our take them just a basis, shop on area a meeting water have level, customer opportunity about team, great the with sale and with strategic the very to to us blessed and crude our are

one. a that's really So good

Neal Dingmann

distribution think your or where second then And do that. see payment capital versus growth to specifically, or debt all leverage coverage just wait can't potential how like would you allocation, I be. No. question to on about distribution you

Avigal Soreq

Yes.

So the row. forward. of are clear to very the Neal, distribution our very we is in we distribution that we increased and we're to continue proud, a our said that With it's that times -- fact with will that XX I push about said, going goal increase

you that that's job our the lot doing. opportunities, ratio gave ratio and around growth more. a the want X.Xx, talk what As it to liquidity, coverage are opportunities adjustor, is the balance are and we our to targeting is do . Odely, and growth long-term between the we the leverage area leverage We obviously about of

Odely Sakazi

new area of of with in sustainable or growth we mention Logistics lot of plant, got the as a infrastructure make Yes. very around of with DPG the absolutely. we are And gas plant well. the along in that about that We also for way it also additional see managing in synergy in HXO did and Delaware as and Delek the gas long along also that acreage DPG, mode implement as we sour. and a with kind need Avigal in mentioned, all in the a associated the

we also the all have on the location So that in something most Midland on and Delaware X both side States, opportunities prolific United side. those assets in the is the

So we're really excited about those opportunities.

Operator

Q&A the will turn now over further questions, that With the back President, Avigal our remarks. Soreq no conference concludes for to I closing session.

Avigal Soreq

casting partnership I Board great and that us. to to Directors doing with that the foremost, the joined thank and friends we share in the and our we'll in my great company are this the in around invest for. want of investors to Thank And talk and makes to to So to our the table work and we progress first employees next our great quarter. call the that again our for progress doing support are you,

Operator

conference today's concludes call. This

You may now disconnect.

Delek Logistics Partners (DKL) 6 Nov 242024 Q3 Earnings call transcript