Delek US Holdings, Inc. (DK) - Q2 2026 10-Q Summary
Business Context and Reporting Period
This report covers the quarterly period ended June 30, 2026. Delek US Holdings, Inc. operates as an integrated downstream energy business with two primary reportable segments: Refining (processing crude oil into transportation fuels) and Logistics (transportation, storage, and water disposal/recycling). The company owns a 63.0% interest in Delek Logistics Partners, LP, which is consolidated as a variable interest entity (VIE).
Key Financial Metrics
| Metric | Q2 2026 (3 Months) | Q2 2025 (3 Months) | YTD 2026 (6 Months) | YTD 2025 (6 Months) |
|---|---|---|---|---|
| Net Revenues | $4,087.0 million | $2,764.6 million | $6,740.1 million | $5,406.5 million |
| Net Income (Loss) Attributable to Delek | $169.5 million | $(106.4) million | $(31.8) million | $(279.1) million |
| Diluted EPS (Attributable to Delek) | $2.71 | $(1.76) | $(0.52) | $(4.55) |
| Operating Income (Loss) | $302.4 million | $(33.5) million | $123.1 million | $(159.3) million |
| EBITDA Attributable to Delek | $433.9 million | $67.0 million | $369.4 million | $49.9 million |
| Cash from Operating Activities | N/A | N/A | $724.0 million | $(11.0) million |
| Cash and Cash Equivalents | $628.6 million | $615.5 million | $628.6 million | $615.5 million |
| Total Debt (Principal) | $3,248.1 million | $3,283.3 million | $3,248.1 million | $3,283.3 million |
| Total Liquidity | $2,477.2 million | N/A | $2,477.2 million | N/A |
Note: Liquidity consists of $628.6 million in cash and $1,848.6 million in unused credit commitments.
Material Changes vs. Prior Period
- Revenue Growth: Q2 2026 net revenues increased 47.8% year-over-year, driven by significant increases in refined product prices (Gasoline +57.4%, ULSD +76.9%) and higher crude activity in the Delaware Gathering operations.
- Profitability Turnaround: The company reported a net income of $169.5 million in Q2 2026, a stark contrast to the $106.4 million net loss in Q2 2025. This was primarily due to improved refining margins (crack spreads) and lower restructuring costs.
- Refining Margins: Refining segment margin increased 196.9% in Q2 2026 compared to Q2 2025, with the refining margin percentage rising to 17.4% from 8.8%.
- Cost of Materials: Increased 40.4% in Q2 2026 due to higher crude oil costs (WTI Cushing +45.4%) and higher Renewable Identification Number (RIN) prices.
- Restructuring Costs: General and administrative expenses decreased 26.0% in Q2 2026, largely due to a $15.8 million reduction in restructuring costs compared to the prior year.
Guidance, Outlook, and Risks
- Capital Spending: Management revised the 2026 full-year capital forecast to a range of $500 million to $550 million. Actual spending for the first six months was $319.0 million.
- Debt Management: The company successfully refinanced its Term Loan Credit Facility in May 2026, reducing the principal to $850.0 million, extending maturity to 2032, and lowering interest rates. Delek Logistics issued $800.0 million in 2034 Notes to redeem older, higher-cost debt.
- Regulatory Developments: On August 3, 2026, the EPA granted a full exemption for the Krotz Springs refinery's 2024 Renewable Fuel Standard obligations, following a favorable court ruling. This reduces RIN compliance costs.
- Risks and Contingencies:
- Geopolitical Volatility: Ongoing conflicts in the Middle East (specifically involving Iran) have caused crude price spikes and supply uncertainty.
- RIN Volatility: RIN prices reached levels higher than any period in the past four years, negatively impacting refining expenses. The company holds a significant "Consolidated Net RINs deficit" liability of $822.5 million.
- Cybersecurity: A non-material cybersecurity incident occurred in July 2026 involving unauthorized access to a single employee account; no operational or financial impact was determined.
Investor Verification Checklist
- RIN Liability Exposure: Verify the magnitude of the $822.5 million Consolidated Net RINs deficit liability and the sensitivity of future earnings to RIN price fluctuations.
- Refining Margin Sustainability: Assess whether the 17.4% refining margin percentage is sustainable given the volatility in global crude prices and geopolitical tensions.
- Debt Covenant Compliance: Confirm continued compliance with debt covenants, particularly the Delek Term Loan Credit Facility, given the company's leverage profile.
- Capital Allocation: Monitor the execution of the revised $500M-$550M capital spending plan and the balance between sustaining maintenance and growth projects.
- Intercompany Transactions: Review the impact of the "Intercompany Agreements" with Delek Logistics regarding the reacquisition of refining assets and the waiver of Omnibus fees.