Earnings wrap: Delek, Delek Logistics

Refiner, Mapco parent declares yet another special dividend

Delek US Holdings has reported fourth-quarter earnings of $64.3 million, reversing a small year-ago loss on the back of better refining margins and more profitable logistics operations. Per diluted share, profits were $1.06, five cents better than what analysts had expected.

Revenues at Brentwood-based Delek, whose retail arm includes the Mapco brand, rose 9 percent to almost $2.2 billion. Segment contribution from the company's refineries in Arkansas and east Texas jumped to $148 million for the quarter from about $32 million in late 2011, thanks in large part to a greater use of cheaper West Texas Intermediate Midland crude oil.

"Our operations continued to perform well as we benefited from elevated Gulf Coast refined product margins," said Chairman, President and CEO Uzi Yemin. "We continued to increase our rail supplied crude ability and reached approximately 19,000 barrels per day in November. Our Tyler refinery continued to perform well as we averaged approximately 60,000 barrels per day of crude throughput during the second half of 2012, fully utilizing the refinery's capacity."

Yemin and the other Delek directors have declared a special dividend of 10 cents per share that will be payable next month to shareholders of record March 26. It will be the company's sixth such payout in less than two years.

At about 1:15 p.m., shares of Delek (Ticker: DK) were trading down slightly at about $38.80. Year to date, they're up more than 50 percent.

Delek US' results include those of Delek Logistics, the infrastructure master limited partnership it spun out last November. That operation earned $26.1 million versus $3.5 million in the last three months of 2011. Net sales jumped 33 percent to $249 million, and the bottom line was helped by lower-than-expected infrastructure costs. Going forward, Yemin said his team is looking at buying other assets, both from Delek US and others.

"During the first quarter 2013, we completed our Nettleton pipeline reversal project, as well as the pipeline connection for the rail offloading facility at Delek US' El Dorado, Arkansas refinery," Yemin said. "In addition, we expect our agreements with our sponsor, Delek US, will give us the opportunity to purchase multiple logistics assets from Delek US over the next two years, beginning in the second half of this year. We believe that these assets have a combined potential EBITDA of $25 [million] to $30 million annually, as we continue to explore additional third party opportunities."

Delek Logistics interests (Ticker: DKL) were up slightly in Thursday afternoon trading to $28.80. They've climbed 27 percent year to date.