BRENTWOOD, Tenn. - Delek US Holdings, Inc. (NYSE: NYSE:DK) reported a fourth-quarter adjusted net loss of $93.2 million, or -$1.46 per share, which fell short of the analyst consensus estimate of -$1.23 per share. Despite the earnings miss, the company's revenue for the quarter was $4.05 billion, surpassing the consensus estimate of $3.62 billion.
The company's stock is down 6% in premarket trading.
During the fourth quarter, Delek experienced a net loss of $164.9 million or -$2.57 per share, compared to a net loss of $118.7 million or -$1.73 per share in the same quarter last year. However, the adjusted EBITDA for the quarter was $60.6 million. The refining segment faced challenges with an adjusted EBITDA of $(10.4) million, reflecting lower refining crack spreads, partially offset by higher sales volume. The logistics segment, on the other hand, had a strong quarter with an adjusted EBITDA of $99.4 million, driven by contributions from the Midland and Delaware Gathering systems and annual rate increases.
Avigal Soreq, President and CEO of Delek US, attributed the record total throughput in refining to operational excellence despite a less favorable market environment. Soreq highlighted the company's strategic investments throughout 2023, which focused on people, processes, and equipment to support safe and reliable operations. These efforts led to one of Delek's safest years and a significant reduction of net debt by $435 million while returning $146 million to shareholders through dividends and share buybacks.
Looking ahead, Delek US estimates the 2024 capital program to be approximately $330 million, which is lower than the 2023 capital expenditures. The company plans to invest $220 million in the refining segment and approximately $70 million in the logistics segment, with a focus on sustaining and regulatory projects as well as strategic growth initiatives.
The company's financial strength and flexibility, along with its operational achievements, position it to deliver competitive returns in the future, as per Soreq's statement.
InvestingPro Insights
Delek US Holdings, Inc. (NYSE: DK) has shown resilience in a challenging market, as evidenced by the company's performance in the last quarter. Investors looking to understand the stock's potential might find the following insights from InvestingPro particularly valuable:
InvestingPro data indicates that Delek's market capitalization stands at $1.81 billion, with a P/E ratio of 28.52. Notably, the company's revenue for the last twelve months as of Q3 2023 was approximately $17.35 billion, despite a decline in revenue growth by 8.09%. The gross profit margin during the same period was 6.18%, which aligns with the challenges faced by the refining segment mentioned in the company's earnings report.
InvestingPro Tips suggest that Delek's management has been focused on rewarding shareholders, as indicated by an aggressive share buyback strategy and a high shareholder yield. In addition, the stock is known for its low price volatility, which could appeal to investors seeking stability. On the flip side, the company's weak gross profit margins and low revenue valuation multiple are areas that prospective investors might monitor closely. Nonetheless, analysts are optimistic about Delek's profitability, predicting the company will be profitable this year, with profitability already achieved over the last twelve months.
For those interested in further insights and tips, InvestingPro offers additional detailed analysis on Delek US Holdings, which can be found at https://www.investing.com/pro/DK. There are 6 more InvestingPro Tips available, which could provide a more nuanced understanding of the company's financial health and stock performance. Readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, accessing a broader range of professional investment tools and data.
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