Delek Logistics Partners Sees Record Quarter, Strong Performance in 2024
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Delek Logistics Partners reported a record-breaking quarter with approximately $107 million in quarterly adjusted EBITDA. The company's strong performance in 2024 has been transformational, and it expects to continue on this path moving forward.
The company took key steps to becoming a premier full-service crude, natural gas, and water provider in the prolific Permian Basin, with plans to make further progress in 2025. In 2024, Delek Logistics increased its financial and trading liquidity, was the first MLP to do two primary offerings in a year since 2017, amended and extended its contract with DK for up to seven years, and completed several significant acquisitions.
The acquisition of Delek's portion in the Wink to Webster pipeline enhanced DKL's overall asset quality and strengthened its position in the Permian Basin. Additionally, the company announced two more acquisitions in the Midland Basin, H2O Midstream and Gravity Water Midstream, which significantly improved its competitive position.
Delek Logistics also made significant progress in its processing plant expansion in the Delaware Basin. The expansion is on track to be completed on time and within budget by the first half of 2025, with an FID announced for acid gas injection at the Libby Complex. This development enhances the company's competitive position in the Delaware Basin and provides a solid foundation for future growth.
Looking ahead to 2025, Delek Logistics expects to continue growing through prudent management of leverage and coverage. The company has initiated strong EBITDA guidance of $480 million to $520 million, representing around 20% growth over its adjusted EBITDA in 2024. Delek Logistics aims to increase its economic separation from its sponsor, DK, with the Board of Directors authorizing up to a $150 million buyback to enhance value for unitholders.
The company's strong performance has been recognized by investors, as it continues to provide one of the best combinations of yield and growth in the AMZI Index. Delek Logistics is excited about its prospects moving forward, with plans to increase its distribution in the future.