DK - Earnings call transcript Q4 2019 | Delek US Holdings, Inc.

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Operator

Thank you for standing by, and welcome to the Delek US 4Q Earnings Call. [Operator Instructions] I would like to hand the conference over to your speaker today, Blake Fernandez. Thank you. Please go ahead.

Blake Fernandez

Thank you and good morning. thank webcast joining Holdings' to XXXX results. to conference on fourth like financial and call discuss would everyone us for today's quarter I Delek US

section President call Louis materials CFO; EVP used the The can members and of as call Yemin, Joining of EVP Refining LaBella, is be of during the as on Assi Ginsburg, today's website. today's our me Investor US found presentation Chairman, well and President our CEO; and team. Relations Uzi Delek on other management

As a safe statements Please defined federal reminder, this may the contain laws. statement. harbor conference under as forward-looking call see securities for is that X Slide term the

non-GAAP the the comparable accordance non-GAAP on generally results found the Investor In addition to principles financial website. reconciliation financial to section press are measures our which results, posted accepted with in reporting which encouraged to results. the of financial release, Investors of report these review or be can in certain GAAP accounting GAAP, Relations we is

release. will Our made, performance, operations incorporated reviewed, strategic segment today's Louis assuming been press few has covering release are the quarter we for Assi financial then will and closing market comments. being remarks fourth press the offer quarter, information call, a that and are into review that is will the earnings prepared cover On and less Uzi

I'll that, to turn Assi. With the call over

Assi Ginsburg

Tax by which and Congress enhanced Thank approved were for Biodiesel Credit, XXXX. you, Financial Blake. results XXXX retroactively was by

of year net share $X.XX $XXX.X or per diluted can or in for net Delek adjusted reported the million basis on per the fourth $X.XX on loss XXXX, X, to US million income prior an compared You quarter period. a share, of see Slide $X.X

portion in this three Adjusted $XX was BTC XXXX $XX.X period. prior quarters of quarter year point the million million of in the for would the the adjusted quarter the XXXX. BTC results benefit Our results XXXX. $XXX.X adjusted first out, reflected million like in the to of from is compared I fourth to XXXX the EBITDA included for

offset headwinds. along However, accelerated repairs. operational after-tax of unplanned partially the inventory builds factors, expense include this and was expenses by and environmental million and such product as with maintenance employee $XX.X and These

expect items the to these many We of in future. normalize

Finally, had of the $XX quarter which in was million $XX of unrealized we million losses hedging approximately .

Wink continuing Slide X, of $XX fourth in working XXXX, of $XX.X excluding waterfall, to Wink for Webster. the generated investment, includes billion, In expenditure detriment to a flow a new contributed provided Wink February, partner. Webster flow XX% to cash million from contribution cash quarter On operation, $XXX we capital we approximately capital totaling was with we $XXX million JV the Webster which a $XXX.X Cash to million. to million

successfully at JV of an invested million immediate secured JV requirements previously capital Wink investments, strengths will finance which Webster and our future the position financial the structure $XX financing. capital, cash expected of to combined new XXX%. The our benefit With project results in distribution

Webster requirements total As $XXX a for to reminder, million. $XXX Wink expect million to capital we of

the and ended $XXX cash consolidated million of a on We $X.X fourth capitalization. our quarter basis term highlights long X, Slide net with debt. billion of

of a Delek million Excluding had XXXX. $XXX $XXX we of debt December debt of net the long-term approximately Logistics net million, as of XX,

I first discuss Louis modeling would in On operation. company. to may to be turn Slide the provided helpful over it the X the guidance, call we’ve quarter that, With

Louis LaBella

Assie. Thanks,

to that where volumes January. at Big system, of Krotz inventory approximately oil in reduced Springs Springs turnaround which were total During point the we reflects build downtime barrels accelerate was the fourth XXX,XXX would in quarter, maintenance sales on per also reformer. to elected our day, the crude product advance I refining throughput, out

want between refinery. quarter quarter Springs day XXX,XXX XXXX, Slide the of fourth expenditures spending, XXXX. day. capital compared our As quarter for and during barrels on This fourth reflects to XXX,XXX On were million capital first I at major to average the to highlight barrels a Slide expect the per turnaround throughput $XXX shown X, X, in we per Big $XXX crude million

Our XXXX provided is will where to million million. to the capital XX% venture. excludes expected by year. approximately to full decline year $XXX Webster $XXX program connector was this Wink amount This joint financing This the be

$XX The approximately million $XX broken The Big is at segment; a is segments the $XX level system million as $XX and logistics million segment; Spring refining our followed. down XXXX by is million and is our at corporate program Gathering capital retail $XXX is included corporate this level. our million comprise the segment; will year.

and CapEx reminder, Wink River Webster. investments to JV a excludes Red like As

Finally, to that Big are we our range the I highlight EBITDA million to forecast would million. $XX million $XX by increasing System in Gathering to Spring XXXX, like of for $X a

Next, to I will for the turn call closing Uzi comments. over

Uzi Yemin

and Thank Louis, you, morning everybody. good

adjusted delivering of million in environment $XXX EBITDA where of XXXX, discounts in performance and financial strong that has million company EBITDA evaporated. Midland an Our $XXX

optionality. the Dorado. During completed distillate be is in which a Krotz new and through brought our continues to run positioned with not vacuum This third retail, acquired to will and to utilization we stores biodiesel asset a passage tends unit facility alkylation continued the performed to plant area credit, tax sales, October. yield Springs portfolio work rates from the extended adding our XXXX. through tower higher benefit at we refining, where bare year grade In the recent improve turnaround to high business has of This the market. online growth at was we biodiesel Renewable crude El select while in

including providing our – Moving the stream. Spring Big feel over this rewarded expansion the be System I'm through enhance to should while system projects Overtime, our earnings performance stability should core Webster, valuation and Gathering Wink we years, sorry, midstream growth Red coming which focus, higher to to earnings River more multiple.

of capital DKL simplify along sponsor from with we asset we're the DK. the structure looking midstream, potential opportunities dropdown As grow to the

a cash $XXX remain repurchased shareholders X, As priority. to shown we XXXX, of In on million stock. our Slide returned

Our reduced peak quarter the of has by been XXXX. share XX% in count second from the

regular approved our has X.X% of increase from a consecutive Directors XXXX of third Board quarter quarterly This XXXX. the quarter seven first in our the Our increase marks since level. dividend

Finally, dear I'd serving a friend Assi be like here, the thank person and company for XX to my for the little last years.

Assi, has to a the myself. to company asset and been huge

Assi how Israel Assi. is what back to Israel, with be family be in they're without elected couldn't already we all to it the move know, company to as and his

wish I'd good luck. like So to him

to With like open that, the for I'd questions. call

Operator

from Micheloto Silvio the [Operator of Instructions] Mizuho. question Your of line comes first

is Your line open.

Paul Sankey

Hi.

Could for all the the best, time, We you've everything that talk your thanks Paul Assi, not very You and people resale. there? exposure the sold go to the first bid little is you some interested about here? mentioned talk I in many done we bit stations added this Uzi, and over Sorry, from are that some. Sankey you have retail where that years. more about from But here a plans and current you environment, Mizuho. the about sector can you, you Thanks. for think and the

Uzi Yemin

out is obviously years. we Yes, have shy absolutely. extract time, of retail I value retail. the done At something for we that weren't morning, same Good for to us Paul. guess

the we doing million is build and cash we cash, that stores then the $XX As what future we know, and is that EBITDA all around and are from there, stores. some here divest retail take collect and

construction stores more we have next As two we are speak year. two under later and coming

flow. make Our of is convert are part plans and and the obviously stores big old divest which and cash invest our to the them them in – stores,

are be surprised wouldn't XX%. to are only building So I EBITDA few stores see the to – continue grow probably returned of XX% them showing is return that between we that to

two years grow the EBITDA $XX the the look we that the three retail to if surprised at if $XX years, don't million, So $XX be will history, million, of million. over next

Paul Sankey

Thanks, Uzi. helpful. That's

the well, Secondly, terms hedging had current hedging Can talk other? environment you you anything in way might it the about you see Thanks about Uzi. in be you one and or lot, some thinking market had of as the you quarter. some a – that losses

Uzi Yemin

tool. part Yes. Hedging, is our obviously, a of box

a we quarter. hedging at – look you If last had

a of it itself first fine. reverse at will look Some that's basis. it the regular quarter, perfectly on in We'll

second If different time that had inventory. last loss of things we we hedging had you because year, and gain big including hedging did, look at this we what quarter a happened

a want clear Paul, be and $X.XX. to we has read to anywhere $X.XX I miss had I between Delek many that saying that notes

$X.XX of the reflects the you couple actual day, the and And in end cash whatever all cash However, actual number we we quarter GAAP I it one time, – we is GAAP the reflects the about situation, Well, of fourth and call number that number hedging. cash in a Delek positive. the it we call the call point the $X.XX the the situation. notes by saw of can in asking look cash in itself it including at But itself want. it the fourth cash can GAAP non-recurring, was can when

Paul Sankey

Okay. anything – was how XXXX? question of you do see market, over part on I the while – market for Thanks. the the essentially, finally And course I me of the was developing

Uzi Yemin

Well pretty the or don't don't several – great IMO benefit. the to far in time stay would is that see a weren't incidents think year. camp gasoline I I be refineries the we wasn't think for so several at IMO we in that market the and same in here is of we camp strong

can that back the in depends a to summer it come So facilities us continues, ahead play of VGO these good and we blending if how on then gasoline. may have also, quickly terms

Paul Sankey

Thank you.

Operator

Suisse. the Your next of from Crédit Gupta comes question Manav of line

is line Your open.

Manav Gupta

spending? the a of $XXX decline you've Hey, doesn't Uzi this? I'm to us Slide versus first showing about understand Can XXXX this that JV you decline. the whoever portion apples-to-apples versus My XXXX, XX% include with spending. done in million give spending, JV question or XXXX $XXX Assi happen million congrats, for in because are the XXXX, trying CapEx Delek. address to major will But the the to wants expenditure as is included spending with So in numbers? JV of JV what is numbers the all for Your Assi all which relates X.

Assi Ginzburg

you we if $XXX look the spent So have million. XXXX, at

In period. addition that, roughly a that to million it’s to in $XX Webster Wink

Manav Gupta

Okay?

Assi Ginzburg

are you receive million we closed Wink to because receiving When we Webster, from million, $XXX will $XX time the because look be at $XX to we have that’s million, million project at $XXX million going we this but is actually so XXXX, financing. $XXX

cash year much, out money lighter So I flow would this going perspective door. is a on say from the a

Manav Gupta

Perfect.

understand what So I wanted that to I point. sure, that's make

why and The was than see second sub-par turnaround. a Uzi, understood we $X going El what point, a El a the there much Dorado Dorado won't last quarter; gross El you understand Slightly gross more margin. Uzi margin happened help us and at Can asset it happen Dorado is this quarter; ahead? Assi about disappointed talked to better you

Uzi Yemin

Yes.

in running tower. quarter of make up Dorado on we the ramping were El the That – So that also coming that work is inventory. during out still – vacuum fourth and on

the shape, where in the run are and diesel tower is barrels we're we its we XXXX. well, still still to So what expected and in is where performing ready predicted yield our

Manav Gupta

Thanks for taking guys. Thanks questions. my

Uzi Yemin

Manav. you, Thank

Operator

next line RBC. Heffern comes Brad of Your from of question the

Your line is open.

Brad Heffern

Hey, structure that everyone. capital color for the guess and MLP. you and about good drops? the you also that around in simplifying timeline assume the release any the more prepared talk can morning some any IDR conversion. I I of sort comments But of the means then talked put about

Uzi Yemin

it a for been part making gathering achieve place market, at simplification that looking together DKL as wanted know, a to to idea support as idea preparing do was we're of the We the system sure mature, and that the potential balance Delek, throughout the of So it at sheet system we're do building and DKL at you it. that the right model. also business the will – DKL large they we that that it the we've needs be to to XXXX and with transaction feel

would So a target. it’s XXXX I say

Brad Heffern

X% seven – you've for And now. where the point then the then guidance that the eight Okay. returns or out place right should yields just guess quarters I dividends, the in Obviously quarter. shareholders. are the think think you the expect repurchases close Thank increased at competitive I dividends The continue of to increases? noticed you. a we first to on cash you in you I that to didn't it's And and give

less at So – is more formalized program that this becoming point?

Uzi Yemin

project the obviously to to the is not or upcoming something is that or cash cash sheet million. got we financing refund continue the we the a that showing already between of the from – balance The that to big also $XX retain up. the and excess have money million and want refinance tax we is coming of in on the flow BTC Well amount shareholders refund the which quarters

continue cash shapes very see we be why will dividend, but reason competitive. your any how I don't So the up won't to we see

Brad Heffern

Thank you.

Operator

the Your Stanley. next Benny question comes Wong line Morgan from of of

line Your open. is

Benny Wong

guys. morning question. took guys My question of you about for are Obviously good you guidance Hey, Thanks my there. there Spring. first your outlook, is and taking out Big around million guys $XX the spending

much the are what business balancing are how runway grow faster you're for growing that and wondering more Just the thinking there is to factors regulate potential there? to

Uzi Yemin

Well just matter a it's of returns.

And fact type County the counties a you is, Howard of Benny, risk in stats grow other from Martin and if as look County are of that at hurdle Martin you have if County. declining. there this business. you We continued County despite and we And are XX% the at around for see to that Howard know, standpoint, you look

threshold, we continue meet start then look year, the this XX% which if that. but seeing quarter, into you mainly to will we the So next benefit will

that is cash continue situation despite market what Our cash we is in. calls coming to and miss, we produce

area least for hurdle XX% balancing in that other just of us So it and meaning with it's needs. also the at

Benny Wong

may. And thoughts, forward. I I thoughts you, for role with able terms next wondering I Uzi. more is going – in those my some Delek potential you question share Understood. to was if appreciate your of if just if

looks I up like year. might As later contract understand this it coming be your

curious investment between been of terms go don't the understanding to think conversations us just how I about But community anywhere. many preliminary obviously future and there's there's and in you're any you if in of see the thinking that the and want company? you

Uzi Yemin

prem. only Not

has me to discussions, what We do. young desire are Board the I'm has in and Obviously, for still and the stay. express company I or enjoy

that I see don't and again. for any agreement. extend usually believe reason any why don't do we to I see it won't three won't reason time it So We that this years happen

Benny Wong

to great Uzi. Thanks, hear. That's

Uzi Yemin

Thanks, Benny.

Operator

from of comes the next Your Sachs. Neil question Goldman Mehta line of

line is Neil Mehta, your open. Your is line open.

Neil Mehta

you thanks. Thanks the appreciate much, so time. Hey, guys taking

is a that? that which you think behind do to about and transition? And question will and decision about first [indiscernible] a CFO the miss bit is for little you, characteristics We're want ton guess for as CFO in then about I think you here role the you going Assi, you, the talk can backfilling the the you seat? how Uzi,

Assi Ginsburg

Sure.

decision and in Israel. with to back family be years with Delek, XX after So my I've made a go

me But to As my able Uzi you I I from and know here before, new I it. it away and that and driver the and will them but what's capabilities to I up then the family tried always home – only always I see that, to I company. let come the be grow convince was Uzi close look this want the support as I'm me how discussed decided for doing role to like. will the – And

Uzi Yemin

me his I'm it's commute very on it's know him, is sad for something it's he's that obviously for joining I'm for painful him Well, family. long have decision. because end, to hard with I I'll one me happy for a but and that been for glad and his us time – Assi something miss personally but

of terms – all a the role, In know we as very role. important CFO we is

weeks very, finalize market very, and we the several four these next the – to about three, that over hopefully are have going very over it candidates We notify good candidates. we'll

well to very known are them of Some guys. you

Neil Mehta

I that, layer ability question you traded a in crude Assi WTI if of play the just Great. projects So period want differential? River that access continue and as to macro create Midland now concern that investments if the – moving that Uzi. the Spring looking you each decently given demand onto flows on up, have other? above for Midland the different be would an on then Big a bid, Well just The to Big that your against down views to what you different we of inversion arbitragers types sustained different through about in has made and as could like for that comes that's particular, Red supply TI the And And pieces and crude, of congratulations does of differential? further Midland update, guess Spring turnaround. think your to talk forward follow-up that is currently time.

Uzi Yemin

It That's I'll that has components. take question. several it. a great deals Avigal, let with day to who every

Avigal Soreq

Hey, Neil good you? How are morning.

Neil Mehta

Good. Thank you.

Avigal Soreq

So find source the we believe is we to the hard all Midland to the clearing that and time all the WTI expensive see be is build going of point. premium more than to it

all the the is for at our the change. it's anyone that going we some pipe; being we've that seen the not reputable believe And we market something with premium. without new of point, to were to that that make exactly fundamental credit Obviously, to diversify investment ready coming surprise announcement So Midland crude.

all and also we – expected alternative also we of So half the known is have well XXXX. other for since obviously we and and lineup that that was premium WXW second – well we of EPIC

Uzi Yemin

you to half about remind year just a Neil, day. expansion in is barrels second of that the the XX,XXX the

that'll be access So through River. the incremental to Red half second

Neil Mehta

Great.

Operator

question of from Barclays. line Chen the Theresa next Your of comes

line Your open. is

Theresa Chen

Assi like morning. your my retirement. to on also Good congratulations I to offer

Second a differs. over work Neil's effort the and Maybe of time hard you Midland follow-up all years. question thank for your on around around, the

long So for? going of EPIC on might fill result and do see to in just do that we from interim the has think think easing is some I you And the believe in Oak some reported been How pressure on go been Gray this has this line you a alone? when of news.

Uzi Yemin

sure you to I not the am pinning give guess exact I I'm that. smart timing, Well down enough

we crude steps change doing fleet. we be see a as – want that to company, However, I our already – but clear to taking

barrels others between especially flowing that, sure we are several So Cushing and of the on lot are fact there of I'm the same Midland doing do in if of – there's light that thing, lots a pipelines. still

this expensive source So for while be more just how the stay, destination I can extensive know can that I economics. long period time. of the barrel don't the don't than They're not believe of

T&D. will We and Also, had people are would – Similar to Something do pipeline, what basically talking converting something we happen will these a pipeline barrels. did. somebody angled We about, canceled We wells. different. that do canceled. we what XX,XXX some

ship while. need situation, more So don't I exact get, for enough I'm a will this more If is pin time. ship to this few a the just and stays people down if to they smart what not but use months to

Theresa Chen

it. then the about at gears switching the transaction. DKL touching earlier And Got markets a the dropdown looking on bit, support to and the comments

Just what perhaps with XXX and more to the AMZ to options today, Uzi for assumptions, financing private the at be your going you and markets economic open are would financing?

Uzi Yemin

for start economics Delek very by impacting high days trading few transaction in the par. last ago days being well companies I'll both market above is Logistics, a the First, better of looked said, some in that few the With and bond transaction. that saying the much changes yield the the MLP the

In that, revolver our million. addition to by is still unfunded $XXX

market, will the shares don't I they accept returns. improve, providing. market So mentioned, probably are for as hand XX% the accept to of If happy on basically, less mean Logistics those the are would that but we see that to without mean as of especially utilizing market. just to at have like we drop, payment. And capacity Delek, we do currently the as more look And, of private going Delek we it in you Delek yield funding, have likelihood when the a I always those

Theresa Chen

are it with portion cash? since this plans like a with what And cash be that sounds current it. of or Got the the portion debt for proceeds, the could done all of

Uzi Yemin

to the you provide we plan. to continue that cash company. number we to to at can so We of guys Well want The think strategic need for continue cash thing comfortable our to look stock our that implement maintain we us price. feel level one is know I the

EBITDA then and return through shareholders. invest or cash to cash that look to generate more ways the that to take will at we place different So either

Theresa Chen

Thank you.

Operator

line the Phil of Your Gresh next question comes JPMorgan. from

Your line is open.

Phil Gresh

Good Yes. morning. Hi.

previous are where cash with? in financial of to a thinking consolidated think drops. leverage, about a and the differential environment comfortable follow-up a current Midland especially from with consolidated Just the the they about Krotz do level question parent on and are, and basis you getting tight net what you're How leverage, you

Assi Ginsburg

a have you we billion as on $X.X year roughly So debt basis, finished know, the consolidated million $XXX and with EBITDA. of we of

X.X in times other two leverage, we energy a even leveraged. times past, X.X the So that to saw companies times think, it's I companies

If that financially. in at trading our very is leverage, times, good the and times at, levels very, as well you is these very shape look company we of bond a two think X.X

millions over dollars I Delek need thing. would of like X.X businesses remember and to gathering Wink to mention hundreds to that, years. last we Webster the in one invested of

the yet. All the there of our and EBITDA books on sitting of is debt none

we when a about additional EBITDA, of think we expect So over look XXXX, their to coming of at Delek from assets. when those produce EBITDA $XXX ability we million

in we're think we the investment, I for here the transition right making we are EBITDA. being penalized that see now but So don't the

as Delek additional and between cash addition And the invested of in to be from during received we already already project take, QX the In back Uzi to and will three position. at we $XX we refund expect Those BTC together QX QX, to million are position $XXX because tax parents' US that's be. a really net million. like and level net the we financing mentioned, that,

Phil Gresh

us color actually details. how we financing in the for give once stream financial modeling, what think, you this that structure could we too kind of follow-up some how about cash-in impacts Thanks. see in very comes Well, this given thanks getting question project the all on detailed into maybe financing led cash-out a without just to statement. XXXX, color structure, clear my JV those but Especially with do on

Assi Ginsburg

the have low, project LIBOR the as we and closed plus lock know, is we So The extremely to you project in it's interest a opportunity X.X financing. financing good on the the LIBOR very to to XX% low hedge we going way going it's at the financial, exactly a there level, of Red River. The point it. on show like be this will probably at up treasuries

at be will interest net of level. it project So the costs the

So we $XX current pay the costs. we have return of interest will say project, which project, EBITDA is expect, if $XX million million net-net, year let's the on XX% roughly to a from a

be a will year, $XX distribution a around million return. the assuming XX% So

So that's not equity what the P&L. debt the way you'll and to investment where method will on sheet on see see we it the And similar they the were. balance be then, is in what

Phil Gresh

great. Okay, Thank you very much.

Assi Ginsburg

I will say one of project. more thing. the in amortization the We're of not anticipating debt any few years first

of cash Derek. the go will all So flow to

Phil Gresh

right. Thanks. Okay. All

Operator

Your of Roger from next Fargo. Read question comes line the of Wells

line Your is open.

Roger Read

the good thanks, for moving everything for thanks the back best Congratulations you Assi, to Yes, let me morning. on Israel. in years. in And say all and over

Assi Ginsburg

Thank you, Roger.

Roger Read

a follow the just across in pretty not calendar units I that's it run better last point full to it, line at are we by if opportunities than, you've was El A rest some things call, up be your might with One, expectations some Dorado, of major on of questions. what performing. this year? this about quarter had, topic probably tweak to a couple be thinking other quarter, the there curious on you the should where Is the upgrades guess able how and now a to just that

Louis LaBella

Yes. Roger.

unit the exactly and at So looking right. you're

it's producing. Looking at the unit, still

the of optimize the there to so all as into bring to the have variety well of make strong the to money crews unit that. we've we really us As we try diesel capture different opportunities that's with expected that out refinery bottom tower. commercial going-forward, been working spec most available what's look the and as seeing for the and We can yield we a right-off asphalt now, that with making can around product

Uzi Yemin

Roger, I particular, which up add, quarter. the would were October, in mentioned the when facility crack think was Louis back was spreads quarter just ramping And strongest during the but in I in earlier, fourth

the weren't that. we able of So really to capture benefit

weaker. online gotten December so the facility had And when in was contributing cracks really November,

contribution XQ, would into we a XQ, et better So cetera. expect

Roger Read

Great. local. running barrel And maybe back Thanks Midland something that. a or out mispriced We've the heard sometimes barrel out a to barrel you're about, crews, some Franken[ph] even for a previously [indiscernible] Cushing versus of switching then barrel excuse Midland earlier that discussion pure Cushing it's towards what's of of coming backing-off than at a Cushing. lot run of to called Franken better a

in any even be as units, to yields crude negative to about the major stock? of In might words, think impacts sort see a do shift just side? So crude have change a we just crudes other have bit curious that get an little more the in you on wider we the change on feed to in

Uzi Yemin

at we Roger, It configuration the there depends when say every the is – the to the you crude change a on And of need time. what every there slate, LP barrel we to same unit. is merit. But a we look at quality of

we of our of quality the the the doing remember maintain – gathering to system just we way of because are and can stuff, that However, some we barrel.

on it time. the refinery specific the So specific and the situation depends at

already though scenario to Midland that under for to going there's you a Cushing barrel. I'm to a change incentive tell versus for $X.XX, us barrel $X,

Roger Read

underlying would acquisitions I the EBITDA you retail just follow-up, what earlier do as you One I volumes business of know get though of as – because you ex-the you mentioned years. remarks that's opening see How the renewables but expected. as as coming it all do in you and about just well never last investments. tax mentioned renewables Yes, well, How know have be part made the may to going because EBITDA sort if that time-to-time, from in renewed thought see that's process. an we'll growth growth on the credit, some some

Uzi Yemin

fact. that until Well, XXXX was just the first it renewed

opening returns an other is a biodiesel be XX%. Second, want at to opportunities. the in situation XX%, to of that in invest We we for us look don't

biodiesel sold we diesel, the it. If renewable are you and then not controlling with alone in remember, as alone, California we

that always we depends it don't an depends look We believe food honest just on So the based want to to need area market, energy, on feedstock, remember. I be need at. so something in it to we though. the that's this is that

Roger Read

Thank fair. you. That's

Uzi Yemin

Thanks Roger.

Operator

the Your next Paul line comes of question Scotiabank. of Cheng from

open. is line Your

Paul Cheng

Hey Good morning. guys.

Uzi Yemin

Good morning, Paul.

Paul Cheng

Uzi. you, Thank

Paul Cheng

your to help Assi, the for you all retirement say the just for and luck fun and the second you want wish Israel. have Thank in of over congratulations best years.

We will miss you.

Just a the Webster get if rest you're when be question the and financing, that to saying that to couple repay correctly So to that when the you're that several pay-off? for is is will this impact that going quick with of right? see the project all project need you an start of years can payment, I side, going principal not going be to financing be on reporting

Uzi Yemin

So the all the become put mentioned the we already put needs project as the likely first will equity, that doing The the of work, that. equity JV you're years balloon. you we’ve we Because, from a and mostly that the of paid going deal have XX% the a all put is the after basically amortized, the bond of basically rest. forward, then very financing by, that three also the is first, deal. the XXX% usually way investments a the And of with

in we very bond, I grade amortization mentioned will most investment the likely light eventually years. a will on as see this few it turn So next into bond and

Paul Cheng

to and turn then, but bond start bond you after don't to on piece I that it that into you that? come you after see, so repayment, likely that years, by stream three you most return if a have that

Louis LaBella

another construction another MPLX. Plains, years. shippers that, Delek, two it's there, not It's the Exxon, pipeline. plus It's by look of this finance. And finance, project permanent then at a Yes. after but

an see So into quality with a the we of shippers, bond. turning issue don't it

Paul Cheng

second that the quarter product and in hedging you have position, tell quarter? warning us and the the can what And with that you in hedged what first

Uzi Yemin

Avigal. ahead, go think, don't I Well,

Avigal Soreq

Paul, of don't disclose it. positions around the a any have we details we that really of lot different

to of unfortunately, into get going not we're on So just it. level that detail

Paul Cheng

fine. for the I That's is Okay. Big And Spring, the full assume turnaround? a plant that turnaround

Uzi Yemin

That sometime early is completed March. correct. be Would

Paul Cheng

Okay. the is And for sold only being the diesel, renewable California? in product

Uzi Yemin

sorry. I'm

Paul Cheng

California. renewable being in guys the that that is diesel you all sold produced, Is

Uzi Yemin

California. No, not Nothing all. at in sold is being

Paul Cheng

Is that another that credit? a low tax in that's opportunity funding, kind of carbon given

Uzi Yemin

and producing are a not we diesel. Well, biodiesel renewable

we that's And gallons That's the the benefit that are are people We So blending diesel $XX see in split reason dollar. the what into million we're split not the most we the of the quarter. XX:XX, these the you splitting. we is sell. reason don't don't doing it. full split we all

Paul Cheng

I see.

do. Will Thank you. Okay.

Uzi Yemin

Thank you.

Operator

Cowen. Your Gabelman next of question the comes Jason from of line

is open. Your line

Jason Gabelman

back Hi, just a go second. wanted to good cash for to flow I the morning.

inflow then mentioned think I an $XX million to $XX million be there call Then in credit. was and from going to Wink a blenders it payments an that comes additional, the equity you tax additional Webster. the to amount there's offset to

outside flow coming is that operations? much of how of cash to So terms normal all together in

Assi Ginsburg

we between of you QX, received that in million receive Webster QX. would $XX them and to $XXX will and million, it's billion and when financing. the QX. $XX million tax have we So from received We BTC Most refund, be we would between receive QX expect net Wink all, to of $XX would have combine of QX it

Jason Gabelman

right. any other call there out? you Was All inflows, cash XQ, could one-time in

Assi Ginsburg

is system that stopped producing million $XX we cash. of gathering tax in some that benefits at put part the the A service saw You big end over of we fact the was the a year. of of towards result there

So you'll million flows in when in there's cash of see I $XX the QX. get flow tax you it, and think

Uzi Yemin

tax. deferred It's

Jason Gabelman

it. Got

on just XQ expect a Okay. you And earnings there that that biodiesel material is impact then any this made, acquisition as in you result?

Uzi Yemin

that the million, will now be dollar the we for to in are plans three place, we – said general, with in between around Well, you the to going going $XX if are biodiesel year.

Jason Gabelman

a Thanks lot. right, great. it. Got All

Operator

end come the the it closing turn for remarks. we I gentleman, management back our and to and of to Ladies have will time

Uzi Yemin

Well, thank to to in to make thank Directors the to us. for supporting thank Board belief And their like table. also We'll everybody my for morning. I'd like Have a I'd this I'd who employees listening friends in us. like like this or soon. I'd their us investors all to is. the think talk to our great what of around you thank day. you interest for you it company mainly But

Operator

call. you for conference Thank participating. today's concludes This

You disconnect. may now

Delek US (DK) 26 Feb 202019 Q4 Earnings call transcript