On a year-over-year basis, results in the first quarter 2016 benefited from higher sales volumes compared to the prior year period when the
In addition to the factors above, results were negatively affected by approximately
In
Yemin concluded, “We have been focused on maintaining liquidity in our balance sheet and ended the quarter with
Regular Quarterly Dividend and Share Repurchase
During the first quarter 2016 from
Liquidity
As of March 31, 2016,
During the first quarter 2016, approximately
Refining Segment
| Tyler, Texas Refinery |
El Dorado, Arkansas Refinery |
|||||||||||||||
| Operating Highlights |
Three Months Ended March 31, |
Three Months Ended March 31, |
||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||
|
Contribution Margin, $ in millions (1) |
$ | 4.5 | $ | (3.0 | ) | $ | 19.0 | $ | 29.2 | |||||||
| Crude Throughput, bpd | 63,504 | 18,574 | 72,619 | 76,695 | ||||||||||||
| Total Throughput, bpd | 68,253 | 20,044 | 77,086 | 80,075 | ||||||||||||
| Total Sales Volume, bpd | 72,320 | 23,200 | 79,554 | 79,140 | ||||||||||||
| Refining Margin, $/bbl sold | $ | 4.93 | $ | 8.32 | $ | 0.77 | $ | 7.81 | ||||||||
|
Adjusted Refining Margin, $/bbl sold (2) |
$ | 5.17 | $ | 8.21 | $ | 3.31 | $ | 10.39 | ||||||||
| Direct Operating Expense, $ in millions | $ | 27.9 | $ | 20.4 | $ | 29.0 | $ | 26.5 | ||||||||
| Direct Operating Expense, $/bbl sold | $ | 4.24 | $ | 9.76 | $ | 4.00 | $ | 3.72 | ||||||||
(1) Contribution margin for
(2) Reconciliations of refining margin and adjusted refining margin are included in the attached tables.
Refining segment contribution margin was
The Midland WTI crude differential to Cushing WTI averaged a
On a year-over-year basis, throughput and sales volume increased at
In the first quarter 2016, operating expenses increased at both refineries on a year-over-year basis. The increase at
Logistics Segment
The logistics segment contribution margin in the first quarter 2016 was
Retail Segment
| Three Months Ended March 31, |
|||||||||||||
| Retail Operating Highlights | 2016 | 2015 | |||||||||||
| Contribution margin, $ in millions | $ | 12.0 | $ | 12.3 | |||||||||
| Operating expenses, $ in millions | $ | 33.4 | $ | 32.5 | |||||||||
| Merchandise margin | 28.0 | % | 28.1 | % | |||||||||
| Fuel margin, per gallon | $ | 0.152 | $ | 0.163 | |||||||||
| Store count (end of period) | 355 | 360 | |||||||||||
Retail segment contribution margin decreased year-over-year primarily due to lower fuel margins, partially offset by higher fuel gallons sold and merchandise sales. Fuel gallons sold increased to 111.1 million from 108.7 million in the prior-year period and merchandise sales increased year-over-year to
First Quarter 2016 Results | Conference Call Information
Investors may also wish to listen to
About
Safe Harbor Provisions Regarding Forward-Looking Statements
This press release contains forward-looking statements that are based upon current expectations and involve a number of risks and uncertainties. Statements concerning current estimates, expectations and projections about future results, performance, prospects and opportunities and other statements, concerns, or matters that are not historical facts are “forward-looking statements,” as that term is defined under the federal securities laws.
Investors are cautioned that the following important factors, among others, may affect these forward-looking statements. These factors include but are not limited to: risks and uncertainties with respect to the quantities and costs of crude oil we are able to obtain and the price of the refined petroleum products we ultimately sell; gains and losses from derivative instruments; changes in the scope, costs, and/or timing of capital and maintenance projects; management’s ability to execute its strategy of growth through acquisitions and the transactional risks associated with acquisitions; the effect on our financial results by the financial results of
Forward-looking statements should not be read as a guarantee of future performance or results and will not be accurate indications of the times at or by which such performance or results will be achieved. Forward-looking information is based on information available at the time and/or management’s good faith belief with respect to future events, and is subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements.
Non-GAAP Disclosures:
This earnings release includes references to financial measures that are not defined under U.S. generally accepted accounting principles (“GAAP”). These non-GAAP measures include adjusted net income or loss and adjusted net income or loss per share.
|
Delek US Holdings, Inc. |
|||||||||||
| March 31, 2016 |
December 31, 2015 |
||||||||||
|
(In millions, except share and per share data) |
|||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 349.9 | $ | 302.2 | |||||||
| Accounts receivable | 213.6 | 233.0 | |||||||||
| Accounts receivable from related parties | 0.2 | 0.5 | |||||||||
| Inventories, net of lower of cost or market valuation | 321.7 | 307.6 | |||||||||
| Other current assets | 119.6 | 145.5 | |||||||||
| Total current assets | 1,005.0 | 988.8 | |||||||||
| Property, plant and equipment: | |||||||||||
| Property, plant and equipment | 2,102.7 | 2,100.1 | |||||||||
| Less: accumulated depreciation | (608.9 | ) | (579.0 | ) | |||||||
| Property, plant and equipment, net | 1,493.8 | 1,521.1 | |||||||||
| Goodwill | 74.4 | 74.4 | |||||||||
| Other intangibles, net | 26.9 | 27.3 | |||||||||
| Equity method investments | 596.9 | 605.2 | |||||||||
| Other non-current assets | 109.3 | 108.1 | |||||||||
| Total assets | $ | 3,306.3 | $ | 3,324.9 | |||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 414.7 | $ | 397.6 | |||||||
| Current portion of long-term debt and capital lease obligations | 114.4 | 95.2 | |||||||||
| Obligation under Supply and Offtake Agreement | 124.4 | 132.0 | |||||||||
| Accrued expenses and other current liabilities | 177.0 | 134.9 | |||||||||
| Total current liabilities | 830.5 | 759.7 | |||||||||
| Non-current liabilities: | |||||||||||
| Long-term debt and capital lease obligations, net of current portion | 847.6 | 880.5 | |||||||||
| Environmental liabilities, net of current portion | 7.3 | 7.9 | |||||||||
| Asset retirement obligations | 9.6 | 9.7 | |||||||||
| Deferred tax liabilities | 231.6 | 247.9 | |||||||||
| Other non-current liabilities | 63.5 | 65.3 | |||||||||
| Total non-current liabilities | 1,159.6 | 1,211.3 | |||||||||
| Stockholders’ equity: | |||||||||||
| Preferred stock, $0.01 par value, 10,000,000 shares authorized, no shares issued and outstanding | — | — | |||||||||
| Common stock, $0.01 par value, 110,000,000 shares authorized, 66,987,187 shares and 66,946,721 shares issued at March 31, 2016 and December 31, 2015, respectively | 0.7 | 0.7 | |||||||||
| Additional paid-in capital | 642.8 | 639.2 | |||||||||
| Accumulated other comprehensive loss | (45.0 | ) | (45.3 | ) | |||||||
| Treasury stock, 4,989,910 shares and 4,809,701 shares, at cost, as of March 31, 2016 and December 31, 2015, respectively | (157.6 | ) | (154.8 | ) | |||||||
| Retained earnings | 674.9 | 713.5 | |||||||||
| Non-controlling interest in subsidiaries | 200.4 | 200.6 | |||||||||
| Total stockholders’ equity | 1,316.2 | 1,353.9 | |||||||||
| Total liabilities and stockholders’ equity | $ | 3,306.3 | $ | 3,324.9 | |||||||
|
Delek US Holdings, Inc. |
|||||||||||
| Three Months Ended March 31, |
|||||||||||
| 2016 | 2015 | ||||||||||
|
(In millions, except share and per share data) |
|||||||||||
| Net sales | $ | 1,105.9 | $ | 1,150.6 | |||||||
| Operating costs and expenses: | |||||||||||
| Cost of goods sold | 991.1 | 1,006.1 | |||||||||
| Operating expenses | 101.9 | 91.4 | |||||||||
| Insurance proceeds — business interruption | (42.4 | ) | — | ||||||||
| General and administrative expenses | 34.6 | 32.7 | |||||||||
| Depreciation and amortization | 36.1 | 28.3 | |||||||||
| Other operating loss, net | 0.3 | — | |||||||||
| Total operating costs and expenses | 1,121.6 | 1,158.5 | |||||||||
| Operating loss | (15.7 | ) | (7.9 | ) | |||||||
| Interest expense | 15.0 | 10.1 | |||||||||
| Interest income | (0.3 | ) | (0.4 | ) | |||||||
| Loss from equity method investments | 18.0 | — | |||||||||
| Other loss (income), net | 0.6 | (0.9 | ) | ||||||||
| Total non-operating expenses, net | 33.3 | 8.8 | |||||||||
| Loss before income tax benefit | (49.0 | ) | (16.7 | ) | |||||||
| Income tax benefit | (25.1 | ) | (6.0 | ) | |||||||
| Net loss | (23.9 | ) | (10.7 | ) | |||||||
| Net income attributed to non-controlling interest | 5.3 | 5.4 | |||||||||
| Net loss attributable to Delek | $ | (29.2 | ) | $ | (16.1 | ) | |||||
| Basic & diluted loss per share: | |||||||||||
| Basic | $ | (0.47 | ) | $ | (0.28 | ) | |||||
| Diluted | $ | (0.47 | ) | $ | (0.28 | ) | |||||
| Weighted average common shares outstanding: | |||||||||||
| Basic | 62,132,007 | 57,289,925 | |||||||||
| Diluted | 62,132,007 | 57,289,925 | |||||||||
| Dividends declared per common share outstanding | $ | 0.15 | $ | 0.15 | |||||||
| Delek US Holdings, Inc. | |||||||||||
| Consolidated Statements of Cash Flows | |||||||||||
| (In millions) | |||||||||||
|
Three Months Ended March 31, |
|||||||||||
| 2016 | 2015 | ||||||||||
| Cash Flow Data | (Unaudited) | ||||||||||
| Operating activities | $ | 71.9 | $ | (61.5 | ) | ||||||
| Investing activities | (34.2 | ) | (76.6 | ) | |||||||
| Financing activities | 10.0 | 70.4 | |||||||||
| Net increase (decrease) | $ | 47.7 | $ | (67.7 | ) | ||||||
| Delek US Holdings, Inc. | ||||||||||||||||||||||||||
| Segment Data (Unaudited) | ||||||||||||||||||||||||||
| (In millions) | ||||||||||||||||||||||||||
| Three Months Ended March 31, 2016 |
||||||||||||||||||||||||||
| Refining | Logistics | Retail |
Corporate, Other and Eliminations |
Consolidated | ||||||||||||||||||||||
| Net sales (excluding intercompany fees and sales) | $ | 735.9 | $ | 67.7 | $ | 301.6 | $ | 0.7 | $ | 1,105.9 | ||||||||||||||||
| Intercompany fees and sales | 91.4 | 36.4 | — | (127.8 | ) | — | ||||||||||||||||||||
| Operating costs and expenses: | ||||||||||||||||||||||||||
| Cost of goods sold | 787.9 | 66.8 | 256.2 | (119.8 | ) | 991.1 | ||||||||||||||||||||
| Operating expenses | 58.3 | 10.5 | 33.4 | (0.3 | ) | 101.9 | ||||||||||||||||||||
| Insurance proceeds — business interruption | (42.4 | ) | — | — | — | (42.4 | ) | |||||||||||||||||||
| Segment contribution margin | $ | 23.5 | $ | 26.8 | $ | 12.0 | $ | (7.0 | ) | 55.3 | ||||||||||||||||
| General and administrative expenses | 34.6 | |||||||||||||||||||||||||
| Depreciation and amortization | 36.1 | |||||||||||||||||||||||||
| Other operating income | 0.3 | |||||||||||||||||||||||||
| Operating loss | $ | (15.7 | ) | |||||||||||||||||||||||
| Total assets | $ | 1,947.4 | $ | 379.2 | $ | 436.0 | $ | 543.7 | $ | 3,306.3 | ||||||||||||||||
| Capital spending (excluding business combinations) | $ | 3.3 | $ | 1.1 | $ | 1.9 | $ | 3.6 | $ | 9.9 | ||||||||||||||||
| Three Months Ended March 31, 2015 |
||||||||||||||||||||||||||
| Refining | Logistics | Retail |
Corporate, Other and Eliminations |
Consolidated | ||||||||||||||||||||||
| Net sales (excluding intercompany fees and sales) | $ | 700.7 | $ | 111.2 | $ | 338.0 | $ | 0.7 | $ | 1,150.6 | ||||||||||||||||
| Intercompany fees and sales | 126.3 | 32.3 | — | (158.6 | ) | — | ||||||||||||||||||||
| Operating costs and expenses: | ||||||||||||||||||||||||||
| Cost of goods sold | 756.9 | 108.4 | 293.2 | (152.4 | ) | 1,006.1 | ||||||||||||||||||||
| Operating expenses | 48.2 | 10.8 | 32.5 | (0.1 | ) | 91.4 | ||||||||||||||||||||
| Segment contribution margin | $ | 21.9 | $ | 24.3 | $ | 12.3 | $ | (5.4 | ) | 53.1 | ||||||||||||||||
| General and administrative expenses | 32.7 | |||||||||||||||||||||||||
| Depreciation and amortization | 28.3 | |||||||||||||||||||||||||
| Operating income | $ | (7.9 | ) | |||||||||||||||||||||||
| Total assets | $ | 1,932.9 | $ | 332.6 | $ | 450.2 | $ | 178.2 | $ | 2,893.9 | ||||||||||||||||
| Capital spending (excluding business combinations) | $ | 85.0 | $ | 3.8 | $ | 1.3 | $ | 0.6 | $ | 90.7 | ||||||||||||||||
|
Refining Segment |
Three Months Ended March 31, |
|||||||
| 2016 | 2015 | |||||||
|
Tyler Refinery |
(Unaudited) | |||||||
| Days in period | 91 | 90 | ||||||
| Total sales volume (average barrels per day)(1) | 72,320 | 23,200 | ||||||
| Products manufactured (average barrels per day): | ||||||||
| Gasoline | 36,606 | 11,514 | ||||||
| Diesel/Jet | 27,842 | 7,359 | ||||||
| Petrochemicals, LPG, NGLs | 1,948 | 410 | ||||||
| Other | 1,483 | 346 | ||||||
| Total production | 67,879 | 19,629 | ||||||
| Throughput (average barrels per day): | ||||||||
| Crude oil | 63,504 | 18,574 | ||||||
| Other feedstocks | 4,749 | 1,470 | ||||||
| Total throughput | 68,253 | 20,044 | ||||||
| Per barrel of sales: | ||||||||
| Tyler refining margin | $ | 4.93 | $ | 8.32 | ||||
| Direct operating expenses | $ | 4.24 | $ | 9.76 | ||||
|
El Dorado Refinery |
||||||||
| Days in period | 91 | 90 | ||||||
| Total sales volume (average barrels per day)(2) | 79,554 | 79,140 | ||||||
| Products manufactured (average barrels per day): | ||||||||
| Gasoline | 42,958 | 40,006 | ||||||
| Diesel | 26,773 | 28,440 | ||||||
| Petrochemicals, LPG, NGLs | 746 | 665 | ||||||
| Asphalt | 4,036 | 8,082 | ||||||
| Other | 892 | 1,757 | ||||||
| Total production | 75,405 | 78,950 | ||||||
| Throughput (average barrels per day): | ||||||||
| Crude oil | 72,619 | 76,695 | ||||||
| Other feedstocks | 4,467 | 3,380 | ||||||
| Total throughput | 77,086 | 80,075 | ||||||
| Per barrel of sales: | ||||||||
| El Dorado refining margin | $ | 0.77 | $ | 7.81 | ||||
| Direct operating expenses | $ | 4.00 | $ | 3.72 | ||||
|
Pricing statistics (average for the period presented): |
||||||||
| WTI — Cushing crude oil (per barrel) | $ | 33.73 | $ | 48.80 | ||||
| WTI — Midland crude oil (per barrel) | $ | 33.56 | $ | 47.18 | ||||
| US Gulf Coast 5-3-2 crack spread (per barrel) | $ | 7.68 | $ | 14.99 | ||||
| US Gulf Coast Unleaded Gasoline (per gallon) | $ | 1.04 | $ | 1.50 | ||||
| Ultra low sulfur diesel (per gallon) | $ | 1.03 | $ | 1.69 | ||||
| Natural gas (per MMBTU) | $ | 1.96 | $ | 2.87 | ||||
|
|
||||||||
(1) Sales volume includes 1,446 bpd and 478 bpd sold to the logistics segment during the three months ended March 31, 2016 and March 31, 2015, respectively. Sales volume also includes sales of 292 bpd and 1,340 bpd of intermediate and finished products to the
(2) Sales volume includes 4,387 bpd and 4,472 bpd of produced finished product sold to the retail segment during the three ended March 31, 2016 and March 31, 2015, respectively. Sales volume also includes 0 bpd and 139 bpd of produced finished product sold to the
| Delek US Holdings, Inc. | |||||||||
| Reconciliation of Refining Margin per barrel to Adjusted Refining Margin per barrel (3) | |||||||||
| $ in millions, except per share data | |||||||||
| Three Months Ended March 31, |
|||||||||
| 2016 | 2015 | ||||||||
| (Unaudited) | |||||||||
| Tyler (4) | |||||||||
| Reported refining margin, $ per barrel | $ | 4.93 | $ | 8.32 | |||||
|
Adjustments: |
|||||||||
| Lower of cost or market gain | (0.60 | ) | (1.66 | ) | |||||
| Hedging loss (gain) | 0.67 | (2.20 | ) | ||||||
| Other inventory loss | 0.17 | 3.75 | |||||||
| Adjusted refining margin $/bbl | $ | 5.17 | $ | 8.21 | |||||
| El Dorado (5) | |||||||||
| Reported refining margin, $ per barrel | $ | 0.77 | $ | 7.81 | |||||
|
Adjustments: |
|||||||||
| Lower of cost or market charge | 0.04 | — | |||||||
| Hedging loss (gain) | 0.44 | (0.48 | ) | ||||||
| Other inventory loss | 2.06 | 3.06 | |||||||
| Adjusted refining margin $/bbl | $ | 3.31 | $ | 10.39 | |||||
(3) Adjusted refining margin per barrel is presented to provide a measure to evaluate performance excluding inventory, hedging (realized and unrealized) and other items.
(4)
Lower of cost or market (“LCM”) valuation - Approximately
Hedging affect - Total hedging loss of
Other inventory - Charges of
(5)
Lower of cost or market (“LCM”) valuation - Approximately
Hedging affect - The total hedging loss of
Other inventory - Charges of
|
Logistics Segment |
Three Months Ended March 31, |
||||||||
| 2016 | 2015 | ||||||||
| (Unaudited) | |||||||||
| Pipelines & Transportation: (average bpd) | |||||||||
| Lion Pipeline System: | |||||||||
| Crude pipelines (non-gathered) | 56,342 | 56,687 | |||||||
| Refined products pipelines to Enterprise Systems | 53,779 | 55,929 | |||||||
| SALA Gathering System | 19,001 | 21,538 | |||||||
| East Texas Crude Logistics System | 9,346 | 19,054 | |||||||
| El Dorado Rail Offloading Rack | — | — | |||||||
| Wholesale Marketing & Terminalling: | |||||||||
| East Texas - Tyler Refinery sales volumes (average bpd)(6) | 66,414 | 26,956 | |||||||
| West Texas marketing throughputs (average bpd) | 14,370 | 16,645 | |||||||
| West Texas marketing margin per barrel | $ | 0.53 | $ | 1.40 | |||||
| Terminalling throughputs (average bpd)(7) | 118,218 | 66,828 | |||||||
(6) Excludes jet fuel and petroleum coke
(7) Consists of terminalling throughputs at our
|
Retail Segment |
Three Months Ended March 31, |
||||||||||
| 2016 | 2015 | ||||||||||
| (Unaudited) | |||||||||||
| Number of stores (end of period) | 355 | 360 | |||||||||
| Average number of stores | 357 | 362 | |||||||||
| Retail fuel sales (thousands of gallons) | 111,124 | 108,657 | |||||||||
| Average retail gallons per average number of stores (in thousands) | 311 | 300 | |||||||||
| Retail fuel margin ($ per gallon) | $ | 0.152 | $ | 0.163 | |||||||
| Merchandise sales (in thousands) | $ | 99,428 | $ | 94,547 | |||||||
| Merchandise margin % | 28.0 | % | 28.1 | % | |||||||
| Change in same-store fuel gallons sold | 0.4 | % | 6.0 | % | |||||||
| Change in same-store merchandise sales | 4.9 | % | 3.5 | % | |||||||
| Delek US Holdings, Inc. | |||||||||||
| Reconciliation of Amounts Reported Under U.S. GAAP | |||||||||||
| $ in millions, except per share data | |||||||||||
| Three Months Ended March 31, |
|||||||||||
| Reconciliation of Net Loss to Adjusted Net Loss | 2016 | 2015 | |||||||||
| (Unaudited) | |||||||||||
| Net loss attributable to Delek | $ | (29.2 | ) | $ | (16.1 | ) | |||||
|
Adjustments, after tax(8) |
|||||||||||
| Lower of cost or market inventory valuation gain | (2.4 | ) | (2.2 | ) | |||||||
| Business interruption proceeds | (27.3 | ) | — | ||||||||
| Unrealized hedging loss | 5.6 | 8.1 | |||||||||
| Total adjustments | (24.1 | ) | 6.0 | ||||||||
| Adjusted net loss | $ | (53.3 | ) | $ | (10.1 | ) | |||||
| Reported loss per share | $ | (0.47 | ) | $ | (0.28 | ) | |||||
|
Adjustments, after tax (per share)(8) |
|||||||||||
| Lower of cost or market inventory valuation gain | (0.04 | ) | (0.04 | ) | |||||||
| Business interruption proceeds | (0.44 | ) | — | ||||||||
| Unrealized hedging loss | 0.09 | 0.14 | |||||||||
| Total adjustments | (0.39 | ) | 0.10 | ||||||||
| Adjusted net loss per share | $ | (0.86 | ) | $ | (0.18 | ) | |||||
(8) A marginal income tax rate of 35 percent was applied to the adjusted items in the calculation of adjusted net income (loss) in all periods.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160505006763/en/
Source:
Delek US Holdings, Inc.
Keith Johnson, 615-435-1366
Vice President of Investor Relations
or
Alpha IR Group,
Chris Hodges, 312-445-2870
Founder & CEO