Delek Logistics (DKL) Q2 2026 Earnings Report

The call was broadly positive: management reported a record quarter (adjusted EBITDA $144M), strong segment and volume growth (notably Gathering & Processing and crude/water/gas QoQ ramps), progressive sour gas infrastructure execution at Libby, proactive refinancing and healthy liquidity, and a 54th consecutive distribution increase. The primary negatives were a sizable YoY decline in Wholesale Marketing & Terminalling, a modest dip in Storage & Transportation, and a temporarily elevated leverage ratio (4.23x) tied to near-term growth spending. Management reaffirmed full-year guidance and highlighted potential upside as Libby sour capabilities come online, indicating confidence that the strong operational momentum will offset near-term headwinds.

Management reaffirmed full‑year 2026 adjusted EBITDA guidance of $520–$560 million after reporting a Q2 record adjusted EBITDA of ~$144 million and distributable cash flow (as adjusted) of ~$81 million with a DCF coverage ratio of ~1.33x. They expect a step‑change in gas utilization as the Libby sour‑gas solution comes online later this year, and said ~80% of pro forma run‑rate EBITDA in 2026 will be third‑party; growth capital of ~$180–$190 million (part of a ~$185 million program) is expected to generate up to $75 million of run‑rate EBITDA (about $15 million in 2026 and $60 million in 2027), Q2 capex was ~$61 million ( ~$51 million growth), leverage ended the quarter at 4.23x (long‑term target 3.5x; managing around ~4x), liquidity is ~ $1.1 billion, they issued an $800 million senior note due 2034 to lower interest costs, and the quarterly distribution was increased to $1.135 per unit (54th consecutive increase).