Delek Logistics Partners, L.p. · NYSE:DKL
Delek Logistics Partners, L.p — NAPTP MLP Conference 2014
29 slides from Delek Logistics Partners, L.p's conference presentation, May 19, 2014
Slide 1: Delek Logistics Partners, LP Investor Presentation
Delek Logistics Partners, LP Investor Presentation NAPTP MLP Conference MAY 2014
Slide 2: Forward-Looking Statements
Forward-Looking Statements 2 These slides, any accompanying oral and written presentation contain forward-looking statements by Delek Logistics Partners, LP (defined as “we”, “our”) that are based upon our current expectations and involve a number of risks and uncertainties. Statements concerning cu
Slide 3: Delek Logistics Partners, LP Overview
Delek Logistics Partners, LP (1) Based on price per common limited unit as of trading on May 14, 2014. (2) Annualized distribution as of May 14, 2014. (3) For reconciliation please refer to page 26. (4) Approximately 3.4% of the ownership interest in the general partner is owned by three members of
Slide 4: Delek US – A Growth Oriented, Financially Strong Sponsor
Delek US – A Growth Oriented, Financially Strong Sponsor • 140,000 bpd of refining capacity in Texas and Arkansas • Access to crude / product terminals, pipeline and storage assets • 361 convenience stores(1) Operational Strength 4 (1) As of March 31, 2014 financial statements. (2) As of May 14, 201
Slide 5: Delek Logistics Partners, LP Overview
Delek Logistics Partners, LP Overview
Slide 6: Stable Asset Base Positioned for Growth
Stable Asset Base Positioned for Growth 6 ~400 miles of crude transportation pipelines, includes the 195 mile crude oil pipeline from Longview to Nederland, TX ~ 600 mile crude oil gathering system in AR Storage facilities with 6.6 million barrels of active shell capacity Pipelines/Transportat
Slide 7: Continued Increase in SALA Gathering System
Continued Increase in SALA Gathering System 7 • Provides access to local Arkansas, east Texas and north Louisiana crudes to Delek US’s El Dorado refinery. • 600 mile crude oil gathering system, primarily within a 60-mile radius of the El Dorado refinery. • Positioned to benefit from development in B
Slide 8: Lion Pipeline System – Potential Throughput Increase
Lion Pipeline System – Potential Throughput Increase 8 • Provides non-gathered crude oil to Delek US’ El Dorado refinery. • Connects refinery to Enterprise TE Products Pipeline. • Throughput may benefit from improvements at Delek US’ El Dorado refinery completed in 1Q14 turnaround that increased lig
Slide 9: West Texas Wholesale Business – Margins Remain Strong
West Texas Wholesale Business – Margins Remain Strong 9 • Achieved record volume in 2013. • Operates in an area around the Permian Basin; benefiting from robust economic activity. • Purchases refined products from third parties for resale at owned and third party terminals in west Texas. (1) 2013 we
Slide 10: East Texas Marketing Volume Continues to Increase
East Texas Marketing Volume Continues to Increase 10 (1) East Texas marketing volumes exclude jet fuel and coke, which are not marketed by DKL. • Volumes have been increasing as Delek US’ Tyler refinery utilization improves; 1Q2014 volume 37% above 2009 level. • Exclusive rights to market 100% of th
Slide 11: Terminals – Growing Asset Base
Terminals – Growing Asset Base 11 • Serves Delek’s retail segment and independent third parties Nashville, TN • Refined products terminalling services for Delek and/or third parties. (1) For reporting purposes, storage operations at Big Sandy, North Little Rock, El Dorado and Tyler are in the pipeli
Slide 12: Delek Logistics' Strategy
Delek Logistics’ Strategy 12 Generate Stable Cash Flow Pursue Organic Expansion Optimize Existing Assets Pursue Accretive Acquisitions Ge n er a te C o ns iste n t Gro w th
Slide 13: DKL: Several Visible Pathways to Growth
DKL: Several Visible Pathways to Growth 13 Dropdowns from Delek US Organic Growth Acquisitive Growth $5 - $10 Million of potential EBITDA expected to be dropped down over next 12 months 25,000 bpd (light crude) rail offloading facility at El Dorado refinery 300,000 bbl crude oil tank (under co
Slide 14: DKL: Recent Acquisitions
DKL: Recent Acquisitions Approximately $22.1 million of expected annual EBITDA 14 Tyler Tank Farm and Product Terminal First drop down from Delek US after the IPO, acquired July 26, 2013 Purchase price: $94.8 million Assets Include: 72,000 bpd capacity product terminal Tank farm with appro
Slide 15: Paline Pipeline – Potential EBITDA Increase in 2015
Paline Pipeline – Potential EBITDA Increase in 2015 15 (1) Fee can be pro-rated upwards if volume exceeds 30,000 bpd 195 mile crude oil pipeline - Mainline pipeline flow reversed from northbound to southbound. 100% of mainline capacity contracted to major oil company through 12/31/2014 Current
Slide 16: Financial Overview
Financial Overview
Slide 17: Improving EBITDA Performance
Improving EBITDA Performance 17 (1) Amounts provided in the Nov. 1, 2012 IPO prospectus showing pro forma historical results for 2011 and forecasted performance for 12 months ending Sept. 30, 2013. Reconciliation on pg. 26 (2) Reconciliation provided on page 26. Results in 2013 and 2014 are as repor
Slide 18: Increased Distribution with Conservative Coverage
Increased Distribution with Conservative Coverage 18 (1) MQD = minimum quarterly distribution set pursuant to the Partnership Agreement. (2) Distribution coverage based on distributable cash flow divided by distribution amount in each period. Please see page 27 for reconciliation. Distribution has b
Slide 19: Questions and Answers
19 Questions and Answers Majority of assets support Delek US‘ strategically located inland refining system Inflation-indexed fees for most contracts Majority of all margin generated by long term, fee-based contracts with volume minimums Agreements with Delek US cap maintenance capex and limit Delek
Slide 20: Appendix
Appendix 2
Slide 21: Delek US' Refineries are Strategically Positioned and Flexible
Delek US' Refineries are Strategically Positioned and Flexible 21 Inland refinery located in East Texas 60,000 bpd, 9.5 complexity Primarily processes inland light sweet crudes (100% in 2013) 93% yield of gasoline, diesel and jet fuel in 2013 El Dorado Refinery (1) Tyler Refinery (1) Inlan
Slide 22: Summary of Certain Contracts
Summary of Certain Contracts (10) 22 Initial / Maximum Term (1) Service Year Ended Dec. 31, 2013 Throughput (bpd)(2) Minimum Commitment (bpd) Tariff / Fee Tariff / Fee Escalator Refinery Shutdown Force Majeure Until December 2014 Crude Oil Transportation N/A N/A $535,700/Month (6) PPI-fg N/A N/A Fiv
Slide 23: Summary of Certain Contracts - footnotes
Summary of Certain Contracts - footnotes 23 (1) Maximum term gives effect to the extension of the commercial agreement pursuant to the terms thereof. (2) Represents average daily throughput for the period indicated, excluding jet fuel and petroleum coke in the East Texas marketing operations. (3) Ex
Slide 24: Amended and Restated Omnibus Agreement
Amended and Restated Omnibus Agreement 24 Under the omnibus agreement, Delek Logistics has a ROFO for 10-years post IPO if Delek US decides to sell the following assets: Rail offloading racks in the El Dorado refinery. Delek Logistics has the right to purchase logistics assets Delek US acquire
Slide 25: Summary Organization Structure
Summary Organization Structure 25 38.0% interest Limited partner-common 96.6% ownership interest (1) 2.0% interest General partner interest Incentive distribution rights Delek Logistics Partners, LP NYSE: DKL (the Partnership) 100% ownership interest Public Unitholders Operating Subsidiaries 11.3% i
Slide 26: Non-GAAP Reconciliation
Non-GAAP Reconciliation 26 (1) Includes approximately $2.0 million of estimated annual incremental general and administrative expenses expected to incur as a result of being a separate publicly traded partnership. (2) Interest expense and cash interest both include commitment fees and interest expen
Slide 27: Cash Available for Distribution
Cash Available for Distribution 27 (1) Non-GAAP measure. See pg. 26 for the reconciliation to GAAP. (2) Distribution for forecast period based on $1.50 per unit; Distribution for year ended December 31, 2013 is based on actual amounts distributed during year; does not include a LTIP accrual in 2013.
Slide 28: Non-GAAP Reconciliation
Non-GAAP Reconciliation 28 LTM 2011 2012 2013 2013 2014 3/31/14 Operating Income $286.1 $473.1 $237.7 $134.4 $67.7 $171.0 Loss on Sale of Assets 3.6 (0.1) - - - - Impairment of Goodwill 2.2 - - - - - Depreciation and Amortization 74.1 82.5 89.8 22.0 24.6 92.4 EBITDA $366.0 $555.5 $327.5 $156.4 $92.3
Slide 29: Investor Relations Contact
29 Investor Relations Contact: Assi Ginzburg Keith Johnson Executive Vice President, CFO Vice President of Investor Relations 615-435-1452 615-435-1366