Delek US Holdings, Inc.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Management's Discussion and Analysis
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Management’s Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is management’s analysis of our financial performance and of significant trends that may affect our future performance. The MD&A should be read in conjunction with our condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and in the Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on February 27, 2026 (the "Annual Report on Form 10-K"). Those statements in the MD&A that are not historical in nature should be deemed forward-looking statements that are inherently uncertain.
Delek US Holdings, Inc. is a registrant pursuant to the Securities Act of 1933, as amended ("Securities Act") and is listed on the New York Stock Exchange ("NYSE") under the ticker symbol "DK". Unless otherwise noted or the context requires otherwise, the terms "we," "our," "us," "Delek" and the "Company" are used in this report to refer to Delek US Holdings, Inc. and its consolidated subsidiaries for all periods presented. You should read the following discussion of our financial condition and results of operations in conjunction with our historically condensed consolidated financial statements and notes thereto.
The Company announces material information to the public about the Company, its products and services and other matters through a variety of means, including filings with the SEC, press releases, public conference calls, the Company’s website (www.delekus.com), the investor relations section of its website (ir.delekus.com), the news section of its website (www.delekus.com/news), and/or social media, including its X account (@DelekUSHoldings). The Company encourages investors and others to review the information it makes public in these locations, as such information could be deemed to be material information. Please note that this list may be updated from time to time.
This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. These forward-looking statements reflect our current estimates, expectations and projections about our future results, performance, prospects, and opportunities. Forward-looking statements include, among other things, statements that refer to acquisitions, including any statements regarding the expected benefits, synergies, growth opportunities, impact on liquidity and prospects, and other financial and operating benefits thereof, statements regarding the effect, impact, potential duration or other implications of, or expectations expressed with respect to, the outbreak of a pandemic and its impact on oil production and pricing, and statements regarding our efforts and plans in response to such events, the information concerning possible future results of operations, business and growth strategies, including as the same may be impacted by any ongoing military conflict, such as the armed conflicts in Ukraine and the Middle East, financing plans, expectations that regulatory developments or other matters will or will not have a material adverse effect on our business or financial condition, our competitive position and the effects of competition, the projected growth of the industry in which we operate, and the benefits and synergies to be obtained from our completed and any future acquisitions or dispositions, statements of management’s goals and objectives, and other similar expressions concerning matters that are not historical facts. Words such as "may," "will," "should," "could," "would," "predicts," "potential," "continue," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "appears," "projects" and similar expressions, as well as statements in future tense, identify forward-looking statements.
Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily 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. Important factors that, individually or in the aggregate, could cause such differences include, but are not limited to:
•volatility in our refining margins or fuel gross profit as a result of changes in the prices of crude oil, other feedstocks, and refined petroleum products;
•reliability of our operating assets;
•actions of our competitors and customers;
•changes in, or the failure to comply with, the extensive government regulations applicable to our industry segments, including current and future restrictions on commercial and economic activities in response to future public health crises;
•our ability to execute our long-term sustainability strategy and growth through acquisitions, such as the Gravity Water Intermediate Holdings LLC ("Gravity") acquisition (the "Gravity Acquisition"), and dispositions, and joint ventures, including our ability to successfully integrate acquisitions, complete strategic transactions, safety initiatives and capital projects, realize expected synergies, cost savings and other benefits therefrom, return value to shareholders, or achieve operational efficiencies;
•diminishment in value of long-lived assets may result in an impairment in the carrying value of the assets on our balance sheet and a resultant loss recognized in the statement of operations;
•the impact on commercial activity and other economic effects of any widespread public health crisis, including uncertainty regarding the timing, pace and extent of economic recovery following any such crisis;
•general economic and business conditions affecting the southern, southwestern, and western United States ("U.S"), particularly levels of spending related to travel and tourism;
•volatility under our derivative instruments;
•deterioration of creditworthiness or overall financial condition of a material counterparty (or counterparties);
•unanticipated increases in cost or scope of, or significant delays in the completion of, our capital improvement safety initiative and periodic turnaround projects;
•risks and uncertainties with respect to the quantities and costs of refined petroleum products supplied to our pipelines and/or held in our terminals;
•operating hazards, natural disasters, weather related disruptions, casualty losses, and other matters beyond our control;
•increases in our debt levels or costs;
•possibility of accelerated repayment on a portion of our Inventory Intermediation Agreement obligation if the purchase price adjustment feature triggers a change on the re-pricing dates;
•changes in our ability to continue to access the credit markets;
•compliance, or failure to comply, with restrictive and financial covenants in our various debt agreements;
•changes in our ability to pay dividends;
•seasonality;
•the decline in margins impacting current results and forecasts could result in impairments in certain of our long-lived or indefinite-lived assets, including goodwill, or have other financial statement impacts that cannot currently be anticipated;
Management's Discussion and Analysis
•earthquakes, hurricanes, tornadoes, and other weather events, which can unforeseeably affect the price or availability of electricity, natural gas, crude oil, and other feedstocks, critical supplies, refined petroleum products and ethanol;
•increases in costs of compliance with, or liability for violation of, existing or future laws, regulations and other requirements;
•societal, legislative, and regulatory measures to address climate change and greenhouse gases emissions ("GHG");
•our ability to execute our sustainability improvement plans, including GHG reduction targets;
•acts of terrorism (including cyber-terrorism) aimed at either our facilities or other facilities;
•impacts of global conflicts such as the armed conflicts in Ukraine and the Middle East;
•future decisions by the Organization of Petroleum Exporting Countries ("OPEC") and the members of other leading oil producing countries (together with OPEC, “OPEC+”) regarding production and pricing and disputes between OPEC+ members regarding the same;
•disruption, failure, or cybersecurity breaches affecting or targeting our information technology ("IT") systems and controls, our infrastructure, or the infrastructure of our cloud-based IT service providers;
•changes in the cost or availability of transportation for feedstocks and refined products; and
•other factors discussed under Item 1A. Risk Factors and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and in our other filings with the SEC.
In light of these risks, uncertainties and assumptions, our actual results of operations and execution of our business strategy could differ materially from those expressed in, or implied by, the forward-looking statements, and you should not place undue reliance upon them. In addition, past financial and/or operating performance is not necessarily a reliable indicator of future performance, and you should not use our historical performance to anticipate future results or period trends. We can give no assurances that any of the events anticipated by any forward-looking statements will occur or, if any of them do, what impact they will have on our results of operations and financial condition. All forward-looking statements included in this report are based on information available to us on the date of this report. We undertake no obligation to revise or update any forward-looking statements as a result of new information, future events or otherwise.
Management's Discussion and Analysis
Executive Summary: Management's View of Our Business and Strategic Overview
We are an integrated downstream energy business focused on petroleum refining and the transportation, storage and wholesale distribution of crude oil, intermediate and refined products as well as wastewater processing, disposal, and recycling.
Business and Economic Environment Overview
Our focus on safe and reliable operations is a pillar which underlines all of our business activities. We continue to identify opportunities to mitigate market risk and focus on efforts that improve our overall cost structure without compromising operational excellence. Our disciplined approach to cost control, coupled with a focus on our enterprise optimization plan ("EOP") margin enhancements supported strong earnings before interest, taxes, depreciation and amortization, and proportional interest, taxes, depreciation and amortization of equity method investments ("EBITDA") and cash flow, while our capital deployment remained aligned with our strategic priorities. We remain committed to building on the progress achieved through the EOP since 2024 and unlocking further free cash flow improvements across all business lines. In 2026, we completed the Big Spring Refinery turnaround safely, on budget and on-time, positioning us to maximize operations for the summer driving season. We also advanced our strong balance sheet initiatives, including issuing new 6.875% Notes due 2034, redeeming all 7.125% Notes due 2028 and a portion of the 8.625% Notes due 2029, and entering into amended and new credit facilities for Delek and Delek Logistics. Additionally, we executed asset purchase agreements with Delek Logistics, (collectively referred to as “the Intercompany Agreements”) which will return refining-related activities and assets back to our refining segment and create further economic independence for our Logistics business.
Global crude oil and refined product markets have experienced significant volatility in 2026, driven by geopolitical instability in the Middle East, including the ongoing conflict involving Iran and resulting disruptions to maritime transit through the Strait of Hormuz. During the second quarter of 2026, our Refining segment continued to benefit from a constructive margin environment compared to 2025, supported by increased crack spreads and favorable crude oil differentials. The domestic West Texas Intermediate ("WTI") differentials compared to Brent continued to be favorable, but the WTI Midland to Cushing differential widened in the second quarter of 2026. We will continue to execute on our priorities of safe and reliable operations, advancing our EOP cost saving initiatives, and delivering shareholder value while maintaining our financial strength and flexibility.
The near term economic outlook remains uncertain due to geopolitical instability, commodity market volatility and our requirements to comply with the U.S. Environmental Protection Agency’s Renewable Fuel Standard - 2 ("RFS-2") regulations. On August 3, 2026 EPA announced its final action on certain petitions for small refinery exemptions under the Renewable Fuel Standard program, which included the petition submitted for the Krotz Springs refinery for the 2024 compliance year. The EPA’s action follows the D.C. Court of Appeals’ April 7, 2026 decision vacating the EPA’s prior denial of the 2024 exemption application. We believe this action reinforces the important role that SREs play in ensuring the RFS program appropriately recognizes the disproportionate economic hardship that is experienced by qualifying small refineries.
In response to uncertainty, we continue to progress our business transformation focused on enterprise-wide opportunities to improve the efficiency of our cost structure. We continued to advance our strategic initiatives aimed at long-term value creation. This includes the progress made on our EOP. The EOP includes leaner costs including lower general and administrative expenses, lower operating expenses and lower interest expense.
We want to reward our shareholders with a disciplined and balanced capital allocation framework. As we strengthen our relative financial position, we believe a balanced approach between shareholder returns and balance sheet improvement is appropriate. As of June 30, 2026, we returned $51.2 million of capital in 2026 to shareholders through dividends and share buybacks.
Our near-term focus is centered around the following: (1) operational excellence, (2) financial strength and flexibility, (3) strategic initiatives which includes unlocking the "sum of the parts" value of our existing business while identifying growth opportunities to enhance the Company's scale and diversify revenue streams, (4) continuing our EOP efforts to enhance margin and cash flow and (5) returns to investors. See further discussion in the "Strategic Objectives" section below.
See further discussion on macroeconomic factors and market trends, including the impact on 2026, in the ‘Market Trends’ section below.
Other 2026 Developments
Delek Debt Agreements
On May 15, 2026, Delek entered into an amendment (“Amendment No. 1”) to the Delek Term Loan Credit Facility. Proceeds and cash on hand were used to refinance the Company’s existing term loan facility. As a result of the refinancing effected pursuant to Amendment No. 1, outstanding term loans of the Company were reduced to an aggregate principal amount of $850.0 million. Amendment No. 1, among other modifications, (i) extended the maturity of the Delek Term Credit Facility to May 15, 2032 and (ii) reduced the rate of interest on borrowings, at the Company’s election, to either term SOFR plus 300 basis points or base rate plus 200 basis points. The amendment also allows for up to 750.0 million in incremental loans subject to certain restrictions.
On April 9, 2026, the Company entered into Amendment No. 4 to Third Amended and Restated Credit Agreement (“Amendment No. 4” and, as amended, the "ABL Credit Agreement"). Amendment No. 4, among other modifications, (i) increased the revolving loan commitments from
Management's Discussion and Analysis
$1,100.0 million to $1,250.0 million, (ii) extended the maturity date of the Delek Revolving Credit Facility from October 26, 2027 to April 9, 2031, (iii) reduced the interest rate margins applicable to the Delek Revolving Credit Facility by 0.25% and (iv) amended certain thresholds for obligations under the Existing ABL Credit Agreement.
Delek Logistics
On January 30, 2026, we entered into the Intercompany Agreements, pursuant to which we agreed to acquire a Tyler refinery tank for total consideration of $19.0 million (the “Tyler Tank Purchase”) and El Dorado tank and terminal assets for total consideration of $66.0 million (the “El Dorado Terminal Purchase”). The Tyler Tank Purchase closed on April 1, 2026 with consideration paid through transfer of Delek Logistics common units, based on a 30-day volume weighted average unit price. The El Dorado Terminal Purchase is expected to close on October 1, 2027, subject to the satisfaction of customary closing conditions. In addition, pursuant to the Intercompany Agreements, Delek waived Omnibus fees for an aggregate of $4.0 million during the first two quarters of 2026.
These transactions with Delek Logistics have been eliminated in consolidation.
Delek Logistics Debt Agreement
On May 14, 2026, Delek Logistics sold $800.0 million in aggregate principal amount of the Co-issuers 6.875% Senior Notes due 2034 (the “Delek Logistics 2034 Notes”). Net proceeds were used to redeem the Delek Logistics 2028 Notes and a portion of the Delek Logistics 2029 Notes.
Cybersecurity Incident
In July 2026, we identified a cybersecurity incident in which an unauthorized third party accessed a single employee's account and copied certain files from our email and SharePoint environment. Upon discovery, we promptly contained the incident, disabled the affected credentials, and engaged a third-party forensic firm and outside legal counsel. The incident did not affect our refining or logistics operations, or financial reporting systems, and did not result in any loss of availability of our data. Management has determined, based on information known to date, that the incident is not material and is not reasonably likely to have a material impact on our business, financial condition, or results of operations. Our assessment of applicable notification and other legal obligations remains ongoing.
Information About Our Segments
We aggregated our operating segments into two reportable segments: Refining and Logistics.
Operations that are not specifically included in the reportable segments are included in Corporate, Other and Eliminations, which consist of our corporate activities, results of certain immaterial operating segments and intercompany eliminations.
The refining segment processes crude oil and other feedstocks for the manufacture of transportation motor fuels, including various grades of gasoline, diesel fuel, aviation fuel, asphalt, and other petroleum-based products that are distributed through owned and third-party product terminals. The refining segment has a combined nameplate capacity of 302,000 bpd as of June 30, 2026. A high-level summary of the refinery activities is presented below:
| Tyler, Texas refinery (the "Tyler refinery") | El Dorado, Arkansas refinery (the "El Dorado refinery") | Big Spring, Texas refinery (the "Big Spring refinery") | Krotz Springs, Louisiana refinery (the "Krotz Springs refinery") | |||||||||||
| Total Nameplate Capacity (bpd) | 75,000 | 80,000 | 73,000 | 74,000 | ||||||||||
| Primary Products | Gasoline, jet fuel, ultra-low-sulfur diesel, liquefied petroleum gases, propylene, petroleum coke and sulfur | Gasoline, jet fuel, ultra-low-sulfur diesel, liquefied petroleum gases, propylene, asphalt and sulfur | Gasoline, jet fuel, ultra-low-sulfur diesel, liquefied petroleum gases, propylene, aromatics and sulfur | Gasoline, jet fuel, high-sulfur diesel, light cycle oil, liquefied petroleum gases, propylene and ammonium thiosulfate | ||||||||||
| Relevant Crack Spread Benchmark | Gulf Coast 5-3-2 | Gulf Coast 5-3-2 (1) | Gulf Coast 3-2-1 (2) | Gulf Coast 2-1-1 (3) | ||||||||||
| Marketing and Distribution | The refining segment's petroleum-based products are marketed primarily in the south central and southwestern regions of the United States, and the refining segment also ships and sells gasoline into wholesale markets in the southern and eastern United States. In addition, we sell motor fuels through our wholesale distribution network on an unbranded basis. | |||||||||||||
(1) While there is variability in the crude slate and the product output at the El Dorado refinery, we compare our per barrel refined product margin to the U.S. Gulf Coast ("Gulf Coast") 5-3-2 crack spread because we believe it to be the most closely aligned benchmark.
(2) Our Big Spring refinery is capable of processing substantial volumes of sour crude oil, which has historically cost less than intermediate, and/or substantial volumes of sweet crude oil, and therefore the WTI Cushing/ West Texas Sour ("WTS") price differential, taking into account differences in production yield, is an important measure for helping us make strategic, market-respondent production decisions.
(3) The Krotz Springs refinery has the capability to process substantial volumes of light sweet crude oil to produce a high percentage of refined light products.
Our refining segment also owns two biodiesel facilities involved in the production of biodiesel fuels and related activities, located in Crossett, Arkansas and New Albany, Mississippi. During the second quarter of 2024, we made the decision to idle the biodiesel facilities, while exploring viable and sustainable alternatives. In the fourth quarter of 2025, we sold our Cleburne, Texas facility. In addition, the refining segment includes
Management's Discussion and Analysis
our wholesale crude operations and our 50% interest in a joint venture that owns asphalt terminals located in the southwestern region of the U.S.
Our logistics segment contains a full suite of gas, crude and water systems that gathers, transports and stores crude oil and natural gas; markets, distributes, transports and stores refined products; and disposes and recycles water in select regions of the southern United States, West Texas, New Mexico and North Dakota for our refining segment and third parties. It is comprised of the consolidated balance sheet and results of operations of Delek Logistics (NYSE: DKL), where we owned a 63.0% interest at June 30, 2026. Delek Logistics was formed by Delek in 2012 to own, operate, acquire and construct crude oil and refined products logistics and marketing assets. The logistics segment's gathering and processing business owns or leases capacity on approximately 390 miles of crude oil transportation pipelines, approximately 169 miles of refined product pipelines, and approximately 767-mile of crude oil gathering system. Additionally, in the Delaware Basin, we have been expanding our natural gas processing capabilities by constructing a new natural gas processing plant and adding acid gas injection and sour gas processing capabilities. This segment also includes water disposal and recycling operations, located in the Delaware Basin of New Mexico, the Midland Basin of Texas, and the Bakken Basin of North Dakota. The storage and transportation business owns or leases associated crude oil storage tanks. The logistics segment has an aggregate of approximately 11.3 million barrels of active shell capacity. It also owns and operates nine light product terminals and markets light products using third-party terminals. Logistics has strategic investments in pipeline joint ventures that provide access to pipeline capacity as well as the potential for earnings from joint venture operations. The logistics segment owns or leases approximately 161 tractors and 306 trailers used to haul primarily crude oil and other products for related and third parties.
Management's Discussion and Analysis
It is vitally important that our strategic objectives, especially in view of the evolutionary direction of our macroeconomic and geopolitical environment, involve a process of continuous evaluation of our business model in terms of cost structure, as well as long-term economic and operational sustainability. More consolidation in our industry is expected from increased cost pressures due in part to the regulatory environment continuing to move towards reducing carbon emissions and transitioning to renewable energy in the long-term. However, we believe we are uniquely positioned as a leader in operating and excelling in niche markets and could continue capitalizing on our niche position by being the supplier of choice in our markets.
Key Objectives
Certain fundamental principles are foundational to our long-term strategy and direct us as we develop our strategic objectives. With that in mind, we have identified the following overarching key objectives:
I. Operational Excellence
II. Financial Strength and Flexibility - EOP
III. Strategic Initiatives - "sum of the parts"
Operational Excellence
We are committed to operational excellence which includes maintaining safe, reliable, and environmentally responsible operations. It also encompasses the dedication and drive for constant improvement across our operations in reliability, safety, and efficiency. Delek prioritizes stewardship of the environment, and we focus on how to positively impact our shareholders, employees, customers, and the communities where we operate. We believe that focusing on people, processes and equipment will lead to improved utilization and yields and ultimately better employee retention and lower costs, which translates to improved returns for our shareholders. For 2026, we are focused on the following:
•Prioritize safety and environmental compliance through the continued implementation of foundational best practices to increase our ability to provide safe, compliant, and reliable operations.
•Focus on operational excellence by building out our operations centric area business teams, as well as other key competency training.
•Identify and execute on low-capital organic growth projects that improve yield and increase utilization.
•Continue our progression of digital system implementations that will do the following:
◦improve our ability to understand all aspects of our business as well as our ability to make real-time and forward-looking operational decisions; and
◦automate processes and shift operational roles to higher value-added activities.
Financial Strength and Flexibility
In our industry, as with many volatile businesses, it is very important to make capital investments with accretive returns and maintain a strong balance sheet. We want to reward our shareholders and investors with a disciplined and balanced capital allocation framework, which we believe will strengthen shareholder value by, among other things, a stable dividend complemented by opportunistic share repurchases. We are also committed to lowering costs and improving the efficiency of our cost structure in all aspects of our business. For 2026, we are focused on the following:
•Rewarding our shareholders and investors with a disciplined and balanced capital allocation framework, including opportunities to strengthen our balance sheet by reducing debt or opportunistically repurchasing shares with excess cash.
•Maintaining our successful efforts to date with the EOP, and expanding our cost saving initiatives with EOP 2.0. This includes leaner costs, including lower general and administrative expenses, lower operating expenses, specifically at our refineries, and lowering interest expense. The EOP also includes margin initiatives including accretive, minimal capital projects in our refining segment and commercial improvements through market optionality, improved Delek Logistics, and product slate optimization.
Strategic Initiatives
For 2026, we will continue to focus on furthering our "sum of the parts" efforts, focusing on the following:
•Execute on our strategic initiatives, which may include opportunities to monetize our investment in Delek Logistics. The goal being to help unlock value embedded in the Delek valuation by reducing Delek's ownership in Delek Logistics.
•Identify and evaluate investment opportunities that fit our sustainability view and integrate into our current asset footprint, including strategic investments or joint ventures in renewables or carbon capture and incubator investments in new technologies.
Management's Discussion and Analysis
The following table highlights our 2026 Strategic Developments:
2026 Key Initiatives | |||||||||||||
2026 Strategic Developments | Operational Excellence | Financial Strength & Flexibility | Strategic Initiatives | ||||||||||
| Enterprise Optimization Plan | |||||||||||||
| In 2024, we implemented additional cost reduction measures across the organization and announced an EOP which included initiatives focused on improving our financial health and ability to generate cash flows. In 2026, we are focused on maintaining the successful efforts achieved since 2024 and unlocking further free cash flow improvements across all lines of our business. | ü | ü | ü | ||||||||||
| Executing Strategic Transactions with Delek Logistics | |||||||||||||
| On January 30, 2026, we entered into additional asset purchase agreements with Delek Logistics, pursuant to which we agreed to reacquire a Tyler refinery tank and El Dorado tank and terminal assets. The Tyler Tank Purchase closed on April 1, 2026 with payment made through the return of approximately 359.4 thousand Delek Logistics common units. These transactions put additional midstream commercial activities in Delek Logistics and bring refining related activities and assets back to the Refining Segment. Additionally, on January 1, 2026 we closed on the previously announced repurchase of the El Dorado rail facility. | ü | ü | |||||||||||
| Minimizing Financial Risk | |||||||||||||
On April 1, 2026, we entered into an interest rate swap agreement to hedge floating rate debt by exchanging interest rate cash flows, based on a notional amount from a floating rate to a fixed rate, which effectively fixed the variable Secured Overnight Financing Rate ("SOFR") interest component on certain Delek debt. The aggregate notional amount under this agreement covers $200.0 million of the outstanding principal throughout the duration of the interest rate swap. | ü | ||||||||||||
| Efficient Access to Capital | |||||||||||||
On May 14, 2026, Delek Logistics and its wholly owned subsidiary Delek Logistics Finance Corp. (“Finance Corp.” and together with Delek Logistics, the “Co-issuers”), sold $800.0 million in aggregate principal amount of the Co-issuers 6.875% Senior Notes due 2034 (the “Delek Logistics 2034 Notes”). Net proceeds were used to redeem the Delek Logistics 2028 Notes and a portion of the Delek Logistics 2029 Notes. | ü | ||||||||||||
On May 15, 2026, Delek entered into an Amendment No. 1 to the Delek Term Loan Credit Facility. Proceeds and cash on hand were used to refinance the Company’s existing term loan facility. As a result of the refinancing effected pursuant to Amendment No. 1, outstanding term loans of the Company were reduced to an aggregate principal amount of $850.0 million. Amendment No. 1, among other modifications, (i) extended the maturity of the Delek Term Credit Facility to May 15, 2032 and (ii) reduced the rate of interest on borrowings, at the Company’s election, to either term SOFR plus 300 basis points or base rate plus 200 basis points. The amendment also allows for up to 750.0 million in incremental loans subject to certain restrictions. | ü | ||||||||||||
On April 9, 2026, the Company entered into Amendment No. 4 to Third Amended and Restated Credit Agreement. Amendment No. 4, among other modifications, (i) increased the revolving loan commitments from $1,100.0 million to $1,250.0 million, (ii) extended the maturity date of the Delek Revolving Credit Facility from October 26, 2027 to April 9, 2031, (iii) reduced the interest rate margins applicable to the Delek Revolving Credit Facility by 0.25% and (iv) amended certain thresholds for obligations under the Existing ABL Credit Agreement. | ü | ||||||||||||
On March 26, 2026, Delek Logistics Partners, LP entered into a new credit agreement that provides for revolving commitments up to $1,300.0 million in the aggregate with a sublimit up to $150.0 million for letters of credit and up to $50.0 million for swing line loans. | ü | ||||||||||||
Market Trends
Our results of operations are significantly affected by fluctuations in the prices of certain commodities, including, but not limited to, crude oil, gasoline, distillate fuel, biofuels, natural gas, and electricity, among others. Historically, the impact of commodity price volatility on our refining margins (as defined in our "Non-GAAP Measures" in MD&A Item 2), specifically as it relates to the price of crude oil as compared to the price of refined products and timing differences in the movements of those prices (subject to our inventory costing methodology), as well as location differentials, may be favorable or unfavorable compared to peers. Additionally, our refining margin profitability is impacted by regulatory factors, including the cost of renewable identification numbers ("RINs").
We have positioned the Company to continue to run safely, reliably, and environmentally responsibly while leveraging our Delek Logistics business. Crack spreads were higher in 2026 than 2025, and higher than any period in the past four years. RINs also reached pricing levels higher than any period in the past four years which negatively impacted our refining expenses. Many uncertainties remain in 2026 with respect to the global supply and demand of the crude oil and refined products markets heightened by the ongoing conflict in Iran and it is difficult to predict the ultimate economic impacts this may have on our operations. Additionally, U.S. policy changes and escalating conflicts in the Middle East, Europe, and South America could potentially result in supply disruptions or further volatility in crude oil and refined products prices.
See below for further discussion on how certain key market trends impact our operating results.
Management's Discussion and Analysis
WTI crude oil represents the largest component of our crude slate at all of our refineries and can be sourced through our gathering channels or optimization efforts from Midland, Texas, Cushing, Oklahoma, or other locations. We manage our supply chain risk to ensure that we have the barrels to meet our crude slate consumption plan for each month through gathering supply contracts and throughput agreements on various strategic pipelines, some of which include those where we hold equity method investments. We manage market price risk on crude oil through financial derivative hedges, in accordance with our risk management strategies.
The table below reflects the quarterly average prices of WTI Midland and WTI Cushing crude oil for each of the quarterly periods in 2025 and for the two quarterly periods in 2026.
Historically, domestic refiners have benefited from the discount for WTI Cushing compared to Brent, a global benchmark crude. This generally leads to higher margins in our refineries, as refined product prices are influenced by Brent crude prices and the majority of our crude supply is WTI-linked. Because of our positioning in the Permian basin, including our access to significant sources of WTI Midland crude through our gathering system, we are even further benefited by discounts for WTI Midland/WTI Cushing differentials. When these discounts shrink or become premiums, our reliance on WTI-linked crude pricing, and specifically WTI Midland crude, can negatively impact our refining margins. Conversely, as these price discounts widen, so does our competitive advantage, created specifically by our access to WTI Midland crude sourced through our gathering systems.
The chart below illustrates the key differentials impacting our refining operations, including WTI Cushing to Brent, WTI Midland to WTI Cushing, and Louisiana Light Sweet crude oil ("LLS") to WTI Cushing for each of the quarterly periods in 2025 and for the two quarterly periods in 2026.
Management's Discussion and Analysis
We are impacted by refined product prices in two ways: (1) in terms of the prices we are able to sell our refined product for in our refining segment, and (2) in terms of the cost to acquire the refined products to meet refining production shortfalls (e.g., when we have outages), or to acquire refined fuel products we sell to our wholesale customers in our logistics segment. These prices largely depend on numerous factors beyond our control, including the supply of, and demand for, crude oil, gasoline and other refined petroleum products which, in turn, depend on, among other factors, changes in domestic and foreign economies, weather conditions, domestic and foreign political affairs, production levels, the availability of imports, the marketing of competitive fuels and government regulation.
Our refineries produce the following products:
| Tyler Refinery | El Dorado Refinery | Big Spring Refinery | Krotz Springs Refinery | |||||||||||
| Primary Products | Gasoline, jet fuel, ultra-low-sulfur diesel, liquefied petroleum gases, propylene, petroleum coke, and sulfur | Gasoline, jet fuel, ultra-low-sulfur diesel, liquefied petroleum gases, propylene, asphalt, and sulfur | Gasoline, jet fuel, ultra-low-sulfur diesel, liquefied petroleum gases, propylene, aromatics, and sulfur | Gasoline, jet fuel, high-sulfur diesel, light cycle oil, liquefied petroleum gases, propylene, and ammonium thiosulfate |
Management's Discussion and Analysis
The charts below illustrate the quarterly average prices of Gulf Coast Gasoline ("CBOB"), U.S. High Sulfur Diesel ("HSD") and U.S. Ultra Low Sulfur Diesel ("ULSD") for each of the quarterly periods in 2025 and for the two quarterly periods in 2026.
Crack spreads are used as benchmarks for predicting and evaluating a refinery's product margins by measuring the difference between the market price of feedstocks/crude oil and the resultant refined products. Generally, a crack spread represents the approximate refining margin resulting from processing one barrel of crude oil into its outputs, generally gasoline and diesel fuel.
The table below reflects the quarterly average Gulf Coast 5-3-2 ULSD, 3-2-1 ULSD and 2-1-1 HSD/LLS crack spreads for each of the quarterly periods in 2025 and for the two quarterly periods in 2026.
Management's Discussion and Analysis
Environmental regulations and the political environment continue to affect our refining margins in the form of volatility in the price of RINs. We enter into future commitments to purchase or sell RINs at fixed prices and quantities, which are used to manage the costs of our credits for commitments required by the U.S. Environmental Protection Agency (“EPA”) to blend biofuels into fuel products ("RINs Obligation"). On a consolidated basis, we work to balance our RINs Obligation in order to minimize the effect of RINs prices on our results. While we obtain RINs in our refining and logistics segments through our ethanol and biodiesel blending, our refining segment still must purchase additional RINs to satisfy its obligations. Additionally, our ability to obtain RINs through blending is limited by our refined product slate, blending capabilities and market constraints. The cost to purchase these additional RINs is a significant cash outflow for our business. Increases in the market prices of RINs generally adversely affect our results of operations through changes in fair value to our existing RINs Obligation, to the extent we do not have offsetting RINs inventory on hand or effective economic hedges through net forward purchase commitments. RINs prices are highly sensitive to regulatory and political influence and conditions, and therefore often do not correlate to movements in crude oil prices, refined product prices or crack spreads. Because of the volatility in RINs prices, it is not possible to predict future RINs cost with certainty, and movements in RINs prices can have significant and unanticipated adverse effects on our refining margins that are outside of our control.
The chart below illustrates the volatility in RINs for each of the quarterly periods in 2025 and for the two quarterly periods in 2026.
Management's Discussion and Analysis
Energy costs are a significant element of our refining segment's EBITDA and can significantly impact our ability to capture crack spreads, with natural gas representing the largest component. Natural gas prices are driven by supply-side factors such as the amount of natural gas production, level of natural gas in storage and import and export activity, while demand-side factors include variability of weather, economic growth and the availability and price of other fuels. Refiners and other large-volume fuel consumers may be more or less susceptible to volatility in natural gas prices depending on their consumption levels as well as their capabilities to switch to more economical sources of fuel/energy. Additionally, geographic location of facilities makes consumers vulnerable to price differentials of natural gas available at different supply hubs. Within Delek’s geographic footprint, we source the majority of our natural gas from the Gulf Coast, and secondarily from the Permian Basin, coinciding with the physical locations of our refineries. We manage our risk around natural gas prices by entering into variable and fixed-price supply contracts in both the Gulf and Permian Basin or by entering into derivative hedges based on forecasted consumption and forward curve prices, as appropriate, in accordance with our risk policy.
The chart below illustrates the quarterly average prices of Waha (Permian Basin) and Henry Hub (Gulf Coast) per million British Thermal Units ("MMBtu") for each of the quarterly periods in 2025 and for the two quarterly periods in 2026.
Non-GAAP Measures
Our management uses certain non-Generally Accepted Accounting Principles (“non-GAAP”) operational measures to evaluate our operating segment performance and non-GAAP financial measures to evaluate past performance and prospects for the future to supplement our GAAP financial information presented in accordance with U.S. GAAP. These financial and operational non-GAAP measures are important factors in assessing our operating results and profitability and include:
•EBITDA - calculated as net income (loss) attributable to Delek adjusted to add back interest expense, income tax expense, depreciation, amortization and proportional interest, taxes, depreciation and amortization of equity method investments; and
•Refining margin - calculated as gross margin (which we define as sales minus cost of sales) adjusted for operating expenses and depreciation and amortization included in cost of sales.
We believe these non-GAAP operational and financial measures are useful to investors, lenders, ratings agencies and analysts to assess our ongoing performance because, when reconciled to their most comparable GAAP financial measure, they provide improved comparability between periods through the exclusion of certain items that we believe are not indicative of our core operating performance and they may obscure our underlying results and trends.
Non-GAAP measures have important limitations as analytical tools because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures.
Management's Discussion and Analysis
Non-GAAP Reconciliations
The following table provides a reconciliation of EBITDA attributable to Delek to the most directly comparable U.S. GAAP measure, net (loss) income attributable to Delek:
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||
| Reported net (loss) income attributable to Delek US | $ | 169.5 | $ | (106.4) | $ | (31.8) | $ | (279.1) | ||||||||||||||||||||
| Proportional interest, taxes, depreciation and amortization of equity-method investments | 6.8 | 7.7 | 14.1 | 14.8 | ||||||||||||||||||||||||
| Interest expense, net | 100.1 | 85.9 | 184.6 | 170.0 | ||||||||||||||||||||||||
| Income tax expense (benefit) | 41.8 | (14.3) | (16.5) | (51.2) | ||||||||||||||||||||||||
| Depreciation and amortization | 115.7 | 94.1 | 219.0 | 195.4 | ||||||||||||||||||||||||
| EBITDA attributable to Delek | $ | 433.9 | $ | 67.0 | $ | 369.4 | $ | 49.9 | ||||||||||||||||||||
The following table provides a reconciliation of refining margin to the most directly comparable U.S. GAAP measure, gross margin:
Reconciliation of refining margin to gross margin (in millions)
| Refining Segment | ||||||||||||||||||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||
| Total revenues | $ | 4,056.0 | $ | 2,716.8 | $ | 6,686.5 | $ | 5,325.1 | ||||||||||||||||||||||
| Cost of sales | 3,581.2 | 2,695.5 | 6,198.5 | 5,396.4 | ||||||||||||||||||||||||||
| Gross margin | $ | 474.8 | $ | 21.3 | $ | 488.0 | $ | (71.3) | ||||||||||||||||||||||
| Add back (items included in cost of sales): | ||||||||||||||||||||||||||||||
| Operating expenses (excluding depreciation and amortization) | 156.1 | 150.5 | 306.3 | 308.6 | ||||||||||||||||||||||||||
| Depreciation and amortization | 76.6 | 66.5 | 141.9 | 138.4 | ||||||||||||||||||||||||||
| Refining margin | $ | 707.5 | $ | 238.3 | $ | 936.2 | $ | 375.7 | ||||||||||||||||||||||
Management's Discussion and Analysis
Summary Financial and Other Information
The following table provides summary financial data for Delek (in millions):
Summary Statement of Operations Data (1) | Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||
| Net revenues | $ | 4,087.0 | $ | 2,764.6 | $ | 6,740.1 | $ | 5,406.5 | ||||||||||||||||||||
| Cost of sales: | ||||||||||||||||||||||||||||
| Cost of materials and other | 3,390.6 | 2,415.0 | 5,856.4 | 4,814.5 | ||||||||||||||||||||||||
| Operating expenses (excluding depreciation and amortization presented below) | 220.1 | 209.8 | 440.0 | 420.9 | ||||||||||||||||||||||||
| Depreciation and amortization | 111.2 | 87.6 | 208.8 | 182.6 | ||||||||||||||||||||||||
| Total cost of sales | 3,721.9 | 2,712.4 | 6,505.2 | 5,418.0 | ||||||||||||||||||||||||
| Operating expenses related to wholesale business (excluding depreciation and amortization presented below) | 2.9 | 2.2 | 4.5 | 3.5 | ||||||||||||||||||||||||
| General and administrative expenses | 56.7 | 76.6 | 100.7 | 138.1 | ||||||||||||||||||||||||
| Depreciation and amortization | 4.5 | 6.5 | 10.2 | 12.8 | ||||||||||||||||||||||||
| Other operating expense (income), net | (1.4) | 0.4 | (3.6) | (6.6) | ||||||||||||||||||||||||
| Total operating costs and expenses | 3,784.6 | 2,798.1 | 6,617.0 | 5,565.8 | ||||||||||||||||||||||||
| Operating income (loss) | 302.4 | (33.5) | 123.1 | (159.3) | ||||||||||||||||||||||||
| Interest expense, net | 100.1 | 85.9 | 184.6 | 170.0 | ||||||||||||||||||||||||
| Income from equity method investments | (19.7) | (22.2) | (34.3) | (35.5) | ||||||||||||||||||||||||
| Other expense (income), net | 0.1 | 6.2 | (0.2) | 4.6 | ||||||||||||||||||||||||
| Total non-operating expenses, net | 80.5 | 69.9 | 150.1 | 139.1 | ||||||||||||||||||||||||
| Income (loss) from continuing operations before income tax expense (benefit) | 221.9 | (103.4) | (27.0) | |||||||||||||||||||||||||
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-09-04 | Sutil Vicky | Director | Sell | -6,397 | $71.50 | -$457,386 |
| 2026-09-01 | Spiegel Reuven | EVP, Special Projects | Sell | -7,500 ×2 | $73.21 | -$549,094 |
| 2026-08-24 | Sullivan Gary M Jr. | Director | Sell | -27,688 | $69.01 | -$1,910,749 |
| 2026-08-21 | Marcogliese Richard J indirect | Director | Sell | -2,000 | $71.05 | -$142,100 |
| 2026-08-21 | FINNERTY WILLIAM J | Director | Sell | -1,457 | $64.70 | -$94,268 |
| 2026-08-18 | Spiegel Reuven | EVP, Special Projects | Sell | -10,000 | $68.21 | -$682,100 |
| 2026-08-17 | Soreq Avigal | President & CEO | Sell | -80,000 ×4 | $66.51 | -$5,320,815 |
| 2026-08-17 | Hobbs Mark Wayne | EVP, Delek Logistics | Sell | -20,000 ×2 | $64.59 | -$1,291,766 |
| 2026-08-13 | Yemin Ezra Uzi indirect | Director | Sell | -200,000 ×4 | $67.52 | -$13,503,583 |
| 2026-06-29 | FINNERTY WILLIAM J | Director | Sell | -5,000 | $51.50 | -$257,500 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-11-06 10-Q expected by 2026-11-08 (in 54 days)
- ~2027-02-26 10-K expected by 2027-02-27 (in 166 days)
- ~2027-04-28 10-Q expected by 2027-04-30 (in 227 days)
- ~2027-08-04 10-Q expected by 2027-08-06 (in 325 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-08-07 8-K/A Earnings Release; Financial Statements and Exhibits
- 2026-08-05 10-Q Quarterly Report
- 2026-07-23 8-K Other Events; Financial Statements and Exhibits
- 2026-07-02 8-K Officer/Director Change
- 2026-06-09 S-8 Employee Benefit Plan Registration
- 2026-05-15 8-K Material Agreement Entered; Material Financial Obligation; Financial Statements and Exhibits
- 2026-04-29 8-K Earnings Release; Financial Statements and Exhibits
- 2026-04-29 10-Q Quarterly Report
- 2026-04-22 8-K Officer/Director Change; Shareholder Vote Results; Financial Statements and Exhibits
- 2026-04-21 8-K Officer/Director Change; Regulation FD Disclosure; Financial Statements and Exhibits
- 2026-04-21 8-K Other Events; Financial Statements and Exhibits
- 2026-04-10 8-K Material Agreement Entered; Material Financial Obligation; Financial Statements and Exhibits
- 2026-02-27 10-K Annual Report
- 2026-02-27 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
- 2026-02-19 8-K Other Events; Financial Statements and Exhibits