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BRENTWOOD, Tenn. - Delek US Holdings (NYSE:DK) reported a narrower-than-expected adjusted loss for the second quarter as stronger refining margins helped offset ongoing challenges in the energy sector.
The refiner posted an adjusted loss of -$0.56 per share, significantly better than analyst expectations of -$0.86 per share. Revenue reached $2.76 billion, exceeding the consensus estimate of $2.67 billion.
The company’s refining segment saw substantial improvement, with Adjusted EBITDA rising to $113.6 million compared to $42.1 million in the same quarter last year. This improvement was primarily driven by an 11.4% increase in benchmark crack spreads from prior-year levels.
"We continue to make progress in achieving our Sum of the Parts goals and improving the overall profitability of the company by achieving our original $120 million EOP target one quarter in advance," said Avigal Soreq, President and Chief Executive Officer of Delek US. "Our EOP efforts are exceeding expectations and today we have increased our run-rate cash flow improvement target to $130 to 170 million."
The logistics segment also performed well, with Adjusted EBITDA reaching $120.2 million compared to $100.6 million in the prior-year quarter. This growth was attributed to the impact of the W2W dropdown and contributions from recent acquisitions, including H2O Midstream and Gravity.
Delek reported that its Enterprise Optimization Plan (EOP) recognized approximately $30 million of improvements in the second quarter. The company’s midstream subsidiary, Delek Logistics Partners (NYSE:DKL), completed its new Libby 2 gas processing plant, expanding capacity for producer customers in New Mexico.
During the quarter, Delek purchased approximately $13 million in common stock and subsequently repurchased more than $7.5 million after the quarter ended. The company also announced a regular quarterly dividend of $0.255 per share.
As of June 30, Delek US had a cash balance of $615.5 million and total consolidated long-term debt of $3.1 billion, resulting in net debt of $2.49 billion.
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