Delek Logistics Partners, LP (DKL): Results of Operations and Financial Condition
Delek Logistics Partners, LP (DKL) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 Delek Logistics Reports Second Quarter 2026 Results • Delek Logistics reported net income of $28.9 million or $0.54 per unit, and adjusted EBITDA of $143.5 million • Nearing completion of the integrated sour gas processing, treating, and handling solution at the Libb
How this was made
The 30-second read
Why it matters
The filing provides fresh, tradable inputs: Q2 earnings and adjusted EBITDA, segment-level drivers, a declared quarterly distribution, leverage and liquidity updates, and reaffirmed 2026 EBITDA guidance.
Market read
Traders can update models for DKL’s cash-flow outlook using the reaffirmed 2026 EBITDA range, the higher quarterly distribution, and the disclosed leverage/liquidity position.
What to watch
Operating cash flow fell year over year (net cash from operations $71.2M vs $107.4M), so investors may scrutinize working-capital and lease accounting impacts behind distributable cash flow.
Delek Logistics Reports Second Quarter 2026 Results
Adjusted EBITDA and distributable cash flow increased from the second quarter 2025, and the partnership reaffirmed 2026 EBITDA guidance, but GAAP net income, EPS, operating cash flow, Wholesale Marketing and Terminalling Adjusted EBITDA, Storage and Transportation Adjusted EBITDA, and Corporate Adjusted EBITDA declined year over year.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net incomeGAAP | $28.9 million | – | – |
| Net income per diluted common limited partner unitGAAP | $0.54 per diluted common limited partner unit | – | – |
| Net cash provided by operating activitiesGAAP | $71.2 million | – | – |
| Distributable cash flow, as adjustednon-GAAP | $80.5 million | – | – |
| EBITDAnon-GAAP | $120.0 million | – | – |
| Adjusted EBITDAnon-GAAP | $143.5 million | – | – |
| Transaction costs included in EBITDAnon-GAAP | $0.1 million | – | – |
| Sales-type lease accounting impacts included in EBITDAnon-GAAP | $24.0 million | – | – |
| Gathering and Processing Segment Adjusted EBITDAnon-GAAP | $104.1 million | – | – |
| Wholesale Marketing and Terminalling Segment Adjusted EBITDAnon-GAAP | $12.6 million | – | – |
| Storage and Transportation Segment Adjusted EBITDAnon-GAAP | $16.3 million | – | – |
| Adjusted EBITDA from equity method investmentsnon-GAAP | $20.7 million | – | – |
| Corporate Adjusted EBITDAnon-GAAP | a loss of $10.1 million | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Gathering and Processing SegmentAdjusted EBITDA increased primarily due to increased margins. | not reported | – | – |
| Wholesale Marketing and Terminalling SegmentAdjusted EBITDA decreased primarily due to the termination of the East Texas marketing agreement with Delek Holdings and a decrease in wholesale margins. | not reported | – | – |
| Storage and Transportation SegmentAdjusted EBITDA decreased primarily due to decreased income from sales-type leases. | not reported | – | – |
| Investments in Pipeline Joint Ventures SegmentAdjusted EBITDA from equity method investments increased primarily due to increase in income from W2W, partially offset by a decrease in income from investments in other joint ventures. | not reported | – | – |
| CorporateCorporate Adjusted EBITDA was a loss of $10.1 million compared to a loss of $7.9 million in the second quarter 2025. | not reported | – | – |
2026 outlook
- NoteEBITDA guidance of $520 to $560 million
Capital returns
- Declared a quarterly cash distribution of $1.135 per common limited partner unit for the second quarter 2026.
- Distribution will be paid on August 10, 2026 to unitholders of record on August 3, 2026.
- The distribution represents a 1.8% increase over the second quarter 2025 distribution of $1.115 per common limited partner unit.
- 54th consecutive quarterly increase to $1.135/unit.
What drove it
- Consolidated Adjusted EBITDA increased due to higher margins and increased interest income related to sales-type leases.
- EBITDA increased primarily due to performance from the DPG business associated with the prior year dropdown from Delek.
- DDG achieved record crude oil gathered volumes, reflecting strong commercial execution across the crude gathering platform.
- The integrated sour gas processing, treating, and handling solution at the Libby Gas Complex was nearing completion.
- Management cited growing demand for sour gas treating and acid gas injection capabilities.
Concerns
- GAAP net income was $28.9 million compared to $44.6 million in the second quarter 2025.
- Net cash provided by operating activities was $71.2 million compared to $107.4 million in the second quarter 2025.
- Wholesale Marketing and Terminalling Segment Adjusted EBITDA declined due to the termination of the East Texas marketing agreement with Delek Holdings and a decrease in wholesale margins.
- Storage and Transportation Segment Adjusted EBITDA declined due to decreased income from sales-type leases.
- Corporate Adjusted EBITDA was a loss of $10.1 million compared to a loss of $7.9 million in the second quarter 2025.
- A significant portion of revenue is derived from Delek US, subjecting the partnership to Delek US' business risks.
What to watch
- Completion of the integrated sour gas processing, treating, and handling solution at the Libby Gas Complex.
- Demand for sour gas treating and acid gas injection capabilities.
- Execution against 2026 EBITDA guidance of $520 to $560 million.
- Gathering and Processing margins and DDG crude oil gathered volumes.
- Wholesale Marketing and Terminalling margins following the termination of the East Texas marketing agreement with Delek Holdings.
- Liquidity and leverage management following the refinancing of portions of the capital structure.
Balance sheet and cash flow
- Net cash provided by operating activities was $71.2 million in the second quarter 2026 compared to $107.4 million in the second quarter 2025.
- As of June 30, 2026, total debt was approximately $2.4 billion.
- As of June 30, 2026, cash was $13.7 million.
- Leverage ratio was approximately 4.23x.
- Additional borrowing capacity under the $1.3 billion third party revolving credit facility increased to $1.1 billion.
- Successfully refinanced portions of the capital structure, extending debt maturities while reducing interest expense.
Analysis
Delek Logistics delivered higher non-GAAP earnings in the second quarter 2026, with EBITDA of $120.0 million compared to $96.6 million in the second quarter 2025 and Adjusted EBITDA of $143.5 million compared to $127.4 million. The partnership attributed the EBITDA increase primarily to DPG performance associated with the prior year dropdown from Delek. Consolidated Adjusted EBITDA also benefited from higher margins and increased interest income related to sales-type leases.
The GAAP and cash-flow results moved in the other direction. Net income was $28.9 million, or $0.54 per diluted common limited partner unit, compared to $44.6 million, or $0.83 per diluted common limited partner unit, in the second quarter 2025. Net cash provided by operating activities was $71.2 million compared to $107.4 million. Distributable cash flow, as adjusted increased to $80.5 million from $72.5 million, while the reported EBITDA includes $0.1 million of transaction costs and $24.0 million of sales-type lease accounting impacts.
Segment performance was concentrated in Gathering and Processing, where Adjusted EBITDA was $104.1 million compared with $78.0 million, primarily due to increased margins. DDG achieved record crude oil gathered volumes. In contrast, Wholesale Marketing and Terminalling Adjusted EBITDA was $12.6 million compared with $23.3 million, pressured by the termination of the East Texas marketing agreement with Delek Holdings and lower wholesale margins. Storage and Transportation Adjusted EBITDA was $16.3 million compared with $16.9 million due to decreased income from sales-type leases.
Pipeline joint-venture contributions improved, with Adjusted EBITDA from equity method investments of $20.7 million compared to $17.0 million, primarily reflecting higher income from W2W. This was partially offset by lower income from other joint-venture investments. Corporate Adjusted EBITDA was a loss of $10.1 million compared to a loss of $7.9 million. The partnership highlighted nearing completion of the Libby Gas Complex integrated sour gas solution and cited growing demand for its sour gas treating and acid gas injection capabilities.
Capital allocation remained focused on distributions and financial flexibility. The partnership declared a $1.135 per common limited partner unit distribution, a 1.8% increase over the second quarter 2025 distribution of $1.115 per common limited partner unit. At June 30, 2026, it had approximately $2.4 billion of total debt, $13.7 million of cash, an approximately 4.23x leverage ratio, and $1.1 billion of additional borrowing capacity under its $1.3 billion third party revolving credit facility. Management reaffirmed 2026 EBITDA guidance of $520 to $560 million, making execution at Libby, gathering margins, joint-venture income, and wholesale-margin recovery central items for the second half.
Management, verbatim
Delek Logistics delivered another strong quarter in 2026, underscoring the durability of our integrated crude, gas, and water platform and the growing contribution from third-party cash flows. As we continue positioning Delek Logistics for long-term success, we are pleased to announce that Mark Hobbs has transitioned into the role of Executive Vice President of DKL, and that Kris Kindrick has joined Delek Logistics Partners as Senior Vice President, Commercial. These changes reflect our ongoing investment in commercial leadership and the expertise needed to support our growth strategy.
Avigal Soreq, President of Delek Logistics’ general partner
With the near completion of the integrated sour gas system at the Libby Complex and growing demand for our sour gas treating and acid gas injection capabilities, DKL is increasingly positioned as a differentiated Delaware Basin midstream platform with a clear path to long-term value creation.
Avigal Soreq, President of Delek Logistics’ general partner
We are reaffirming our 2026 EBITDA guidance of $520 to $560 million, supported by a more diversified cash flow profile, disciplined management of liquidity and leverage, and the strategic progress made to enhance DKL’s standalone financial profile. As we enter the second half of the year, we remain focused on executing against our growth opportunities, optimizing our asset base, and continuing to deliver attractive returns to unitholders.
Avigal Soreq, President of Delek Logistics’ general partner
Not in the filing
stated, not guessed- Total revenue and total revenue comparisons were not reported in the provided filing text.
- Segment revenue and segment revenue comparisons were not reported in the provided filing text.
- Gross profit, gross margin, operating income, operating expenses, income-tax expense, and tax rate were not reported in the provided filing text.
- Non-GAAP EPS was not reported in the provided filing text.
- Free cash flow, capital expenditures, and unit repurchases were not reported in the provided filing text.
- Prior-quarter comparisons for reported financial metrics were not reported in the provided filing text.
- Percentage year-over-year changes for the reported financial metrics were not reported in the provided filing text.
- Prior outlook was not provided, so no comparison of actual results with prior guidance is available.
- Debt maturity amounts and interest-expense amounts were not reported in the provided filing text.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
This is Delek Logistics Partners, LP’s SEC Form 8-K with Exhibit 99.1 reporting second quarter 2026 results and financial condition.
Ticker impact
Delek Logistics reported Q2 2026 net income of $28.9M, adjusted EBITDA of $143.5M, and reaffirmed 2026 EBITDA guidance of $520M to $560M.
Moderately positive bias for DKL as guidance reaffirmation and distribution growth support cash-flow expectations.
The filing discloses multiple decision-relevant datapoints: Q2 adjusted EBITDA beat vs prior year, explicit 2026 EBITDA range reaffirmation, and a 1.8% higher distribution per unit, all of which typically influence midstream MLP/unit-holder sentiment and yield expectations.
Market effects
Reinforces demand and execution strength in Permian Basin midstream integrated crude and sour gas processing, a read-through for peers with similar assets.
Supports sentiment around Delaware Basin midstream cash flows and sour gas infrastructure utilization.
Limited direct global linkage; primarily regional energy infrastructure and MLP cash-flow expectations.
Counterpoint
Wholesale marketing and terminalling EBITDA declined due to termination of an East Texas marketing agreement, which could cap upside if similar contract headwinds spread.
Key entities
- issuerDelek Logistics Partners, LP
Midstream energy master limited partnership reporting Q2 2026 results, distribution, leverage, and reaffirmed 2026 EBITDA guidance.
- assetLibby Gas Complex
Site where integrated sour gas processing, treating, and handling solution is nearing completion.
- financingThird-party revolving credit facility
Credit facility whose additional borrowing capacity increased to $1.1B as of the filing.
