Executive Summary

Q1 2025 was weak on refining margins but showed progress on strategic priorities: adjusted net loss was $144.4M ($-2.32 per share) and adjusted EBITDA was $26.5M; GAAP net loss was $172.7M ($-2.78 per share). Logistics delivered record adjusted EBITDA ($116.5M), partially offsetting refining losses .
Revenue of $2.642B modestly beat Wall Street consensus ($2.628B) and adjusted EPS beat consensus ($-2.32 vs $-2.43), while EBITDA missed materially, reflecting lower crack spreads and seasonal headwinds; CFO highlighted sequential EBITDA improvement versus Q4 due to stronger refining margins and throughput . Values for estimates retrieved from S&P Global.*
Management raised EOP confidence to “at least $120M” run‑rate cash flow improvement in 2H’25 (from $80–$120M prior) and executed intercompany transactions that pro forma increase DKL third‑party EBITDA to ~80% and unlock >$250M of consolidated liquidity—advancing midstream deconsolidation .
Capital returns continued: ~$32M DK buybacks and $0.255/share dividend ($15.9M total) in Q1; liquidity remained solid with $623.8M cash and net debt of $2.41B (ex‑DKL net debt: $267.9M) .

What Went Well and What Went Wrong

What Went Well

Logistics posted another record quarter: Adjusted EBITDA rose to $116.5M (vs $99.7M YoY), aided by W2W dropdown and H2O/Gravity acquisitions; DKL reiterated FY25 Adjusted EBITDA guidance of $480–$520M and began commissioning Libby 2 .
Strategic progress on SOTP/deconsolidation: intercompany agreements increase DKL third‑party cash flows to ~80% and unlock >$250M of consolidated financial availability; “We remain confident that we will complete the DKL deconsolidation…that will create value” (CEO) .
EOP traction: management now expects “at least ~$120 million” run‑rate improvement in 2H’25; operational upgrades (e.g., Tyler alky upgrade +500 bpd of high‑value products; El Dorado capture rate improvement ~$0.80/bbl in Q1) underpin margin capture gains .

What Went Wrong

Refining profitability deteriorated due to lower crack spreads (benchmarks down ~29.8% YoY); refining adjusted EBITDA fell to $(27.4)M vs $110.1M YoY; total production margin per bbl dropped to $5.75 from $12.55 YoY .
Corporate/Other adjusted EBITDA loss widened to $(62.2)M (vs $(58.2)M YoY), driven by W2W dropdown impacts and restructuring/transaction costs .
Supply & marketing posted a $(23.7)M loss (seasonal wholesale and asphalt weakness), though trends improved into Q2 amid stronger group differentials (management commentary) .

Financial Results

Consolidated Results vs Prior Periods

Metric	Q1 2024	Q4 2024	Q1 2025
Revenue ($USD Billions)	$3.128	$2.374*	$2.642
GAAP Diluted EPS	$-0.51	$-6.55	$-2.78
Adjusted EPS	$-0.41	$-2.54	$-2.32
Adjusted EBITDA ($USD Millions)	$158.7	$-23.2	$26.5
Cash from Operations ($USD Millions)	$166.7	$-163.5	$-62.4

Values with an asterisk (*) retrieved from S&P Global.

Segment Adjusted EBITDA

Segment ($USD Millions)	Q1 2024	Q4 2024	Q1 2025
Refining	$110.1	$-69.6	$-27.4
Logistics	$99.7	$107.2	$116.5
Corporate, Other & Eliminations	$-58.2	$-60.3	$-62.2
Consolidated (continuing ops)	$151.6	$-22.7	$26.9

Refining KPIs

KPI	Q1 2024	Q1 2025
Total throughput (avg bpd)	296,652	289,203
Total production margin ($/bbl)	$12.55	$5.75
OpEx per bbl throughput	$5.90	$6.00

Per‑Refinery Performance (Q1)

Refinery	Throughput (bpd)	Prod. Margin ($/bbl)	OpEx ($/bbl)	Prior‑Year Throughput (bpd)	Prior‑Year Prod. Margin ($/bbl)	Prior‑Year OpEx ($/bbl)
Tyler, TX	69,230	$7.82	$5.69	72,265	$15.72	$5.28
El Dorado, AR	75,761	$3.83	$5.16	83,587	$9.29	$4.72
Big Spring, TX	59,415	$4.86	$8.36	64,853	$12.87	$8.08
Krotz Springs, LA	84,797	$6.40	$5.36	75,947	$12.85	$5.94

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Operating Expenses	Q1 2025	$220–$235M	Actual: $212.4M (OpEx excl. D&A $211.1M + wholesale OpEx $1.3M)	Beat vs guidance
G&A	Q1 2025	$55–$60M	Actual: $61.5M; ex‑restructuring/transactions $50.5M	Mixed (headline above; core below)
D&A	Q1 2025	$100–$105M	Actual: $101.3M	In‑line
Net Interest Expense	Q1 2025	$78–$88M	Actual: $84.1M	In‑line
DKL Adjusted EBITDA	FY 2025	$480–$520M (prior)	$480–$520M (reiterated)	Maintained
Operating Expenses	Q2 2025	—	$215–$225M	New
G&A	Q2 2025	—	$52–$57M	New
D&A	Q2 2025	—	$95–$105M	New
Net Interest Expense	Q2 2025	—	$80–$90M	New
Total Throughput (system)	Q2 2025	—	302–318 kbpd; refinery ranges: Tyler 73–77, El Dorado 80–84, Big Spring 67–71, Krotz 82–86	New
Dividend	Q2 2025	$0.255/sh (prior cadence)	$0.255/sh declared for May 19, 2025	Maintained
EOP Cash Flow Improvement	2H 2025 run‑rate	$80–$120M (Q4 2024)	“At least $120M”	Raised lower bound

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3’24, Q4’24)	Current Period (Q1’25)	Trend
EOP cash flow/margin capture	Introduced $100M run‑rate, ~$50M El Dorado plan; market‑agnostic projects	“At least $120M” run‑rate by 2H’25; Tyler alky upgrade, El Dorado +$0.80/bbl capture in Q1	Improving and raised confidence
Midstream deconsolidation (SOTP)	Ownership down; W2W dropdown; H2O deal; plan to deconsolidate; DKL undervalued vs peers	Intercompany transactions increase DKL third‑party to ~80%, unlock ~$250M liquidity; reiteration to complete deconsolidation	Advancing separation
Libby 2 / AGI sour gas	FID; commissioning planned H1’25	Libby 2 commissioning underway; AGI progressing; supports DKL guidance	On track
Supply/marketing	Seasonal weakness in Q4; improvement initiatives	Q1 loss $(23.7)M but stronger Q2 start in group diffs/asphalt	Seasonal recovery, structural improvements
Regulatory (SRE)	DC Circuit overturn; optimism post‑Chevron	Pursuing retroactive (2019–2020) and forward SREs; petitions ~$300M for 2019–2020 (commentary)	Active engagement
Cost structure (OpEx/G&A)	ZBB saved ~$100M; lower 2025 capex	Q2 OpEx guide higher on throughput/nat gas; core G&A ~$50.5M ex special items	Core costs trending lower

Management Commentary

“We are excited about the progress we are making with our EOP and expect to deliver cash flow improvements of at least ~$120 million by 2H’2025.” — Avigal Soreq, CEO .
“The transactions also improved financial liquidity at DK by around $250 million...and increase DKL’s third‑party cash flow to around 80%.” — Avigal Soreq, CEO .
“Delek Logistics is on track to meet its strong 2025 EBITDA guidance of $480 million to $520 million.” — Avigal Soreq, CEO .
“Tyler...upgrade allows us to increase production of high‑value products by approximately 500 barrels per day...El Dorado...achieved approximately $0.80 per barrel of improvements...on track to achieve the $2 per barrel annual rate.” — Joseph Israel, EVP Ops .
“Cash flow from operations was a use of $62 million...investing includes ~$180 million paid at the closing of the Gravity acquisition and PP&E additions of $136 million.” — Mark Hobbs, CFO .

Q&A Highlights

DKL guidance and Permian outlook: Management reiterated FY25 DKL EBITDA and detailed strong Midland water and Delaware gas/sour gas positioning supporting volumes despite macro uncertainty .
Capital returns: Balanced approach among dividends, buybacks and balance sheet; conviction to repurchase through cycles given valuation .
Supply/marketing trajectory: Structural EOP initiatives drove ~$10M improvement despite weak seasonal conditions; Q2 started strong in group diffs and improving asphalt .
SRE path: Pursuing retroactive relief back to 2019 (~$300M for 2019–2020 compliance) and forward‑looking exemptions; management optimistic on EPA outcomes .
EOP upside: Potential to exceed the $120M run‑rate; additional projects in execution pipeline .
OpEx clarity: Q2 OpEx guided higher mainly from throughput increases and new plant operations; expectation to improve OpEx per barrel into H2’25 .

Estimates Context

Metric	Q4 2024 Estimate	Q4 2024 Actual	Q1 2025 Estimate	Q1 2025 Actual
Revenue ($USD Billions)	$2.576	$2.374	$2.628	$2.642
Primary EPS ($)	$-2.82	$-2.54	$-2.43	$-2.32
EBITDA ($USD Millions)	$-35.0	$-34.6	$4.0	$-17.0

Values retrieved from S&P Global.
Notes: Q1 2025 saw modest beats on revenue and adjusted EPS, but a significant miss on EBITDA reflecting weak cracks and seasonal wholesale/asphalt headwinds. Q4 2024 was broadly in line on EBITDA and ahead on adjusted EPS despite weak margins .*

Key Takeaways for Investors

Logistics strength is durable and growing; DKL’s reiterated FY25 guidance, Libby 2 commissioning, and sour gas capability support cash flows and distribution growth—an ongoing offset to refining cyclicality .
EOP has tangible traction and is now targeted at “at least $120M” run‑rate cash flow uplift in 2H’25; expect incremental margin capture (El Dorado, Tyler upgrades) and lower core G&A as catalysts for estimate revisions .
Intercompany transactions accelerate SOTP execution and midstream deconsolidation, increasing third‑party EBITDA (~80%) and unlocking ~$250M consolidated liquidity; this supports balance sheet flexibility and potential valuation re‑rating .
Near‑term trading lens: Q2 guides imply higher throughput and OpEx tied to capacity utilization and nat gas; with improving rack/netbacks and seasonal upward move in cracks, refining profitability should trend better sequentially .
SRE optionality is material (retroactive and forward); if realized, it could meaningfully improve cash flows and reduce RFS burden—watch for EPA developments as a potential catalyst .
Capital allocation remains shareholder‑friendly (buybacks, maintained dividend) while preserving liquidity; DK repurchased ~$32M of shares and declared $0.255 dividend in Q1 .
Monitor Q2 execution vs guidance (throughput, OpEx per barrel) and ongoing EOP milestones (El Dorado capture rate to $2/bbl run‑rate) for confirmation of margin expansion trajectory .

Additional Notes

Liquidity: Cash $623.8M; consolidated long‑term debt $3,035.3M; net debt $2,411.5M; ex‑DKL net debt $267.9M .
Non‑GAAP adjustments: Other inventory impact (+$26.2M), restructuring costs (+$8.4M), transaction costs (+$3.5M), and updated inclusion of RINs fair value adjustments; reconciliations provided in release .
Other Q1 press releases: None identified beyond the 8‑K furnished press release (EX‑99.1); earnings call slide deck furnished as EX‑99.2 .

Delek US Holdings, Inc. (DK)·Q1 2025 Earnings Summary