DKL - Earnings call transcript Q4 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 Fourth Quarter 2024 Earnings Call. [Operator Instructions] I would now like to turn the conference over to Robert Wright, Deputy CFO.

You may begin.

Robert Wright

to Logistics welcome Earnings Fourth and Call. Conference morning, the Partners Delek Quarter Good on will today's President; me joining Participants call EVP; Hobbs, Reuven include Mark EVP. Spiegel, Soreq, Avigal

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

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

Avigal Soreq

steps We XXXX million quarterly we strong Thank provider has performance. you, Robert. prolific been Delek has make premier are water continued, Logistics Delek and quarter. expect in we key approximately In further adjusted full-service pleased DKL gas in reported to progress to Partners XXXX. Logistics, XXXX, EBITDA. year in Basin, becoming and record natural had a taken Permian for transformational its and the with $XXX another crude,

and primary Permian to to in asset which for financial DKL in of overall acquisition a portion amend certainty to the reflect moment a DK of of quality we the were offerings a the pipeline, at DKL between were also increased cash We increased things to We DKL. years, contract completed position. around year and XXXX. to Webster able like to Wink X extend and We MLP and would providing accomplish I period enhanced do We X take flows. XXXX. DKL liquidity up Delek since in on the trading first the

acquisitions the in HXO Midstream X Basin, Basin the competitive in significantly. Midland Gravity position Water enhanced Midstream, Midland our We and announced

have success seen with so extremely combined and We we far. we our initial are excited the are pleased offering, about

is complete Delaware processing we time XXXX. to first on set and good also in of The are Basin, the the making progress on half our in In expansion plant expansion. budget

expansion, As an on at competitive enhanced future. Delaware AGI sour also we wells gas the position we good acid complete capabilities treating and & gas Complex. the Libby in runway our Logistics plant Delek FID a the provide in growth of the injection for announced

This growth XXXX, guidance XXXX DKL Looking continue coverage. strong to through over the management a million also forward, we'll grow of adjusted partnership EBITDA prudent of EBITDA. XXXX XX% leverage represents initiated around $XXX million. $XXX in to and

to continued our best continue combination DKL provide sponsor, [ DK. AMZI separation ] We'll with increase one growth of of entire the economic our Index. the and yield in to

tool We announced we additional a ways. are separation And today, an few enable progressing deconsolidation. have the the different economic in to

have of to the Board for million up DKL our unitholders. Directors to Our buyback value $XXX from enhance authorized sponsor, DK,

consecutive to I'm also the unit. Board XXth that to distribution pleased per $X.XXX Directors approved in increase the the has of quarterly announce

about very are the excited Logistics. prospect Delek we conclude, of To

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

I will to Mark. now hand it over

Mark Hobbs

Thank you.

Water both of Avigal our liquidity markets. million approximately of managed throughout of $XXX Delek management Midstream, We of a our we growing equity have leverage. by financial XXXX the close with As liquidity. Post we mentioned, Logistics and prudent accessing liquidity debt are acquisition the Gravity and

managing this organic our complete leverage also projects several year. are We we important as growth

and was ratio $XXX.X adjusted quarter DCF Distributable quarter EBITDA Moving to on cash the million the to fourth results. approximately adjusted $XX.X flow, The was in compared $XXX.X X.Xx. XXXX. coverage fourth same period million was our million, of as

the second to long-term objective mentioned of ratio to back of move As this in steadily previously, expect X.Xx our XXXX. we half

Processing higher adjusted quarter and from was compared of Gathering due quarter segment, The XXXX. Delek contribution to to the in for increase the fourth primarily $XX throughput EBITDA assets the $XX.X for Midstream. HXO was Logistics million million As Basin from and Permian

Terminalling primarily Marketing compared to prior margins year. and million intercompany in adjusted transactions. impact lower was million EBITDA to The decrease due $XX.X the of and $XX.X Wholesale wholesale was

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

drop-down this And Webster lastly, last was in the the increase segment XXXX. from pipeline of fourth the August year. quarter the to million quarter compared investments $X.X million Venture contributed contribution Wink with The primarily in Joint in $XX.X of to due

the to and the remainder for new Moving was the The $XX.X $XX.X quarter was was of program growth on new capital of to million gas Midland Delaware projects, allocated in plant. spend quarter advancing expenditures. fourth the the connections The processing systems. for million, namely in which capital gathering

the at on Libby maintenance announced Along have a on expansion and guidance. XXXX, our approximately also growth expect plant of million year capital guidance $XXX processing XXXX our of midpoint, with we to projects. initiating spend approximately full our today completing total $XXX In $XX we and million approximately EBITDA million

With we can that, the open questions. for call

Operator

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

Douglas Irwin

here. guidance Just on the EBITDA

end guide, and it put the Just at acquisitions of points conservative you've looking at the the to some at a processing relatively around the the of low least range. expectations, prior plant benchmarks

moving could of then if low drive about end you might I So the given see high you yourself pieces was versus bit kind of And the what throughout? maybe here? the just a where exiting end maybe talk some little the curious year

Avigal Soreq

we with doing the buyback the every our announced economical from sponsor. growing the the we in we we're you well very DKL, guidance. the for can of a giving time company are step question. see. demonstrated is obviously, separation today $XXX sure, DKL as DK Thanks Obviously, between as and first step that and that for and we listen, increasing that's are And million

we you We feel the guidance that's we obviously, today. to forward do And the try with gave help model others today. confident we is want and get to modeling And to can are is we the more update better, down obviously, exact Mohit looking detailed obviously, to in with for more question, there you how you today. always up we opportunities the where If us And are future. road. and that's what model, there to but questions follow

Douglas Irwin

Yes, first Understood. Maybe guidance. follow-up the a here. X-part I question program, maybe appreciate the a time buyback on

to curious thinking just debt yield relative equity leverage internally all execute to so, the be potentially discounted willing about looking where to you you where be near And use see first, term. fund that is you buybacks? how these here given Just trading? And it second, with on to free you're the quickly just Are cash able then million. the $XXX how expect flow? Or if you may curious over to just funding

Avigal Soreq

Yes, absolutely.

Doug, that So we the if capital you [ our it, ]. can I'm And is close side standpoint, XX% see at we're debt on sure $XX here looking flow appreciate cost is from cash and a what today to free that of X%. around

potential and that for DKL So both reason obviously deconsolidation our initiative that's to a is liked the very cash will that's you for free allow completely for Also a without sponsors. lot. partnership flow it effort an DKL DKL DK, appreciate the can, that sure, and beneficial companies, both fulfill and that its something from standpoint

in embedded initiatives very X that. well are those So

some to We It's Reuven DKL I to market that's DK. more But we condition subject on are and offering color. chime going that. on give of to very closer to definitely specific not that going something let guidance. will that guidance, more be But . give that to to hard look and working in and

Reuven Spiegel

bullet leverage accretive obviously program, have cash from place will X the ratio share while target price company and free company. One, and that makes just be Well, -- a in and it's that points. long sense X-year the execute to covenants the with for as flow complying as we DKL do

Operator

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

Neal Dingmann

plant upside around around EBITDA and -- with My you're upside you it's the question to share year? that's you looks guidance. going see speak on this showing it Could little to EBITDA. maybe just release, same. expansion. I'm in drivers a love potential Obviously, about happen the wondering nice you'd us bit the the Libby this to driving other just mentioned notable great besides maybe see to the is that's the I'd

Avigal Soreq

Yes.

We we deal. we HXO have Libby plant. the & So chips Sour We there many WXW. have the announced that, finished finished in and this Gravity the right? effort. obviously, We all are guidance, the of announced obviously AGI synergies among And deal. We

clear bit Neal terms really is done. much we And guys there of necessary in you give your felt life that guidance it's we we just have a of where and land. making easier So little that to transactions very a a mix

is. AMZI important of is very to versus our cheap how index ] it's good and think entire the I And investors position much how [ see it currency to a

reason that's give So transaction to the is. I of we discounted the our of and we how reflect we to think think more did amount that decided currency because

that's and you can appreciate it, that I'm it. we sure So reason the did

Neal Dingmann

good. I obviously continue key be there And definitely yours, appreciate the the right just be follow-up which out of so my assets now. discount XBear definitely to is seen then would on

Just is of how utilization wondering you just assets wondered demand those looking? assets, how is when -- and at these look

Avigal Soreq

Yes.

looks in So strong assets see wouldn't gas the if we is you area not very a -- those expand good. Obviously, would demand. Delaware the

we reasoning and have like with. implemented the gas very We Delaware, our acreage offering many would Basin. with of I crude, highlight that nicely the concept of have we also water that same But comprehensive the dedication you, Midland to the our producer point for proved in Neal, itself is part discussions in that's another and

us or we paying very also felt reason to we Sour. with about happy confident the Libby and expansion, the that. that's are X So dividends, went That's the we and

feel we -- also confident strategy. our the the and are -- to So we tactics to to

Operator

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

Avigal Soreq

the to next our you, you. of the Thank you. I Logistics for my thank Yes, like we'll thank would Absolutely. table. again Thank in I around like Directors to employees, would quarter. Delek meet and colleagues and Today, Board investors, entire the

Operator

conference This call. concludes today's

now may disconnect. You

Delek Logistics Partners (DKL) 25 Feb 252024 Q4 Earnings call transcript