Company: DK
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001694426-25-000060
Chunk: 124

Company: Delek US Holdings, Inc.
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 8
Chunk 124
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TI Midland crude oil, from an average of $78.55 per barrel to an average of $72.52, or 7.7%; 

•a decrease in sales volumes (including purchased products); and

•a decrease in lease expense as a result of reclassification of certain fees with Delek Logistics from lease expense to interest expense under finance lease accounting. These finance leases have no impact to the Delek US consolidated results as these amounts eliminate in consolidation.

These decreases were partially offset by the following:

•an increase in RINs pricing.

Our refining segment purchases finished product from our logistics segment and has multiple service agreements with our logistics segment which, among other things, require the refining segment to pay terminalling and storage fees based on the throughput volume of crude and finished product in the logistics segment pipelines and the volume of crude and finished product stored in the logistics segment storage tanks, subject to minimum volume commitments. These costs and fees were $125.9 million and $139.2 million during the three months ended March 31, 2025 and 2024, respectively. We eliminate these intercompany fees in consolidation.

Operating Expenses

Operating expenses decreased $7.7 million, or 4.6%, in the three months ended March 31, 2025, compared to three months ended March 31, 2024. The decrease in operating expenses was primarily driven by the following:

•lower employee costs.

Refining Margin

Refining margin decreased by $131.0 million, or 48.8%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, with a refining margin percentage of 5.3% as compared to 8.6% for the three months ended March 31, 2025 and 2024, respectively, primarily driven by the following: 

•a 26.5% decrease in the 5-3-2 crack spread (the primary measure for the Tyler refinery and El Dorado refinery), a 26.7% decrease in the average Gulf Coast 3-2-1 crack spread (the primary measure for the Big Spring refinery) and a 37.1% decrease in the average Gulf Coast 2-1-1 crack spread (the primary measure for the Krotz Springs refinery); 

•a decrease in sales volumes (including purchased products); and

•higher RINs pricing.

These decreases were partially offset by the following:

•a decrease in