Delek US Holdings Reports Second Quarter 2020 Results

BRENTWOOD, Tenn., Aug. 4, 2020 /PRNewswire/ -- Delek US Holdings, Inc. (NYSE: DK) ("Delek US") today announced financial results for its second quarter ended June 30, 2020. Delek US reported second quarter 2020 net income of $87.7 million, or $1.18 per diluted share, versus net income of $77.3 million, or $1.00 per diluted share, for the quarter ended June 30, 2019, which included a $16.8 million income tax benefit relating to incremental loss carrybacks provided by the CARES Act. On an adjusted basis, Delek US reported Adjusted net loss of $110.5 million, or $(1.50) per share for the second quarter 2020. This compares to Adjusted net income of $97.5 million, or $1.27 per share, in the prior-year period. Adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") was $(85.1) million compared to Adjusted EBITDA of $210.7 million in the prior-year period. Reconciliations of net income reported under U.S. GAAP to Adjusted net income and Adjusted EBITDA are included in the financial tables attached to this release.

Adjusted quarterly results were impacted by net losses totaling approximately $(74.9) million (after-tax) or $(1.02) per share, which is comprised of the following: an inventory headwind (or, an unfavorable "other inventory impact") on margin in the amount of $(91.4) million pre-tax, or $(69.9) million after-tax, related to FIFO accounting as compared to current market prices; and a negative margin impact of $(29.0) million pre-tax, or $(22.2) million after-tax, related to the sale of purchased product; realized hedging losses in the amount of $(134.0) million pre-tax, or $(103.9) million after-tax, the majority of which related to fixed price crude transactions that resulted in margin gains at our Tyler Refinery totaling $111.0 million pre-tax, or $84.9 million after-tax, where the magnitude was driven by the historic volatility in the crude market during the second quarter; and a reversal of the $36.1 million tax headwind disclosed in the first quarter of 2020. Note, the other inventory impact is separate from LCM inventory impacts that are excluded from adjusted results. Additionally, a breakdown of realized and unrealized hedging by segment is provided in the tables on page 10.

Uzi Yemin, Chairman, President and Chief Executive Officer of Delek US, stated, "Our diversified portfolio is providing resilience during this period of weak refining margins with the logistics and retail segments generating a contribution margin above $80 million collectively. Our transition to midstream and more stable cash flow is well underway with previous capital investments poised to support ongoing growth from robust second quarter levels."

Mr. Yemin continued, "Our company has a long history of being nimble and we remain agile in terms of flexing our capital spending and cost structure to the prevailing macro environment. We are on-track to exceed guidance of $100 million of cost reductions year over year. Capital spending was reduced dramatically from first quarter levels and we expect to remain disciplined with minimal outlay anticipated for the balance of the year. As of June 30th, the company had a cash balance of $849 million and is well positioned for a turbulent macro environment."

Regular Quarterly Dividend

Delek US announced today its Board of Directors declared a regular quarterly cash dividend of $0.31 per share. Shareholders of record on August 19, 2020 will receive this cash dividend payable on September 3, 2020.

Liquidity

As of June 30, 2020, Delek US had a cash balance of $849.0 million and total consolidated long-term debt of $2,454.9 million, resulting in net debt of $1,605.9 million. As of June 30, 2020, Delek Logistics Partners, LP (NYSE: DKL) ("Delek Logistics") had $995.2 million of total debt and $16.2 million of cash, which is included in the consolidated amounts on Delek US' balance sheet. Excluding Delek Logistics, Delek US had approximately $832.8 million in cash and $1,459.7 million of debt, or a $626.9 million net debt position.

Refining Segment

Refining contribution margin decreased to $59.7 million in the second quarter 2020 from $198.1 million in the second quarter 2019. On an adjusted basis, adjusted refining contribution margin was $(124.1) million in the second quarter 2020 compared to $216.5 million in the second quarter 2019. The current period adjusted refining contribution margin reflects $(90.6) million of other inventory impact, $(29.0) million of losses related to the sale of purchased product, and $(137.0) million of realized hedging losses, partially offset by a $111.0 million benefit from fixed price crude cost transactions.

On a year-over-year basis, results were reduced primarily due to lower crude oil differentials, crack spreads and throughputs as a result of decreased demand due to COVID-19. Further, during the second quarter 2020, the realized Midland-Cushing crude oil discount was $0.48 per barrel compared to a realized discount of $1.77 per barrel in the prior year period. These factors were partially offset by the crude oil futures market that was in contango of $3.06 per barrel in the second quarter 2020 compared to contango of $0.20 per barrel in the second quarter 2019.

Other inventory impact is primarily calculated by multiplying the change of barrels in refined inventory by the difference between current period average NYMEX WTI price and per barrel cost of materials and other for the period recognized on a FIFO basis. The other inventory impact on adjusted refining contribution margin was a charge of $(90.6) million in the second quarter 2020 compared to a charge of $(12.0) million in the second quarter 2019. Other inventory impact included a (charge) benefit to the refineries during the second quarter of 2020 of $(11.8) million for Big Spring, $(59.8) million for El Dorado and $(17.5) million Krotz Springs, as compared to a (charge) benefit of $(11.6) million for Big Spring, $1.1 million for El Dorado and $(1.5) million for Krotz Springs in the second quarter of 2019. Additionally, we buy and sell purchased product to optimize margins and to meet contractual demands, as needed. We recognized losses of $(29.0) million within the refining margins during the second quarter 2020, of which $(30.5) million relates to the Krotz Springs refinery, compared to gains totaling $8.3 million during the second quarter 2019.

Logistics Segment

The logistics segment contribution margin in the second quarter 2020 was $61.4 million compared to $44.2 million in the second quarter 2019. Results improved on a year-over-year basis primarily due to the drop down of the Delek Permian Gathering business and Trucking Assets, increased crude gathering, operating expense reductions and an increase in income from equity method investments. This was partially offset by lower West Texas gross margin on a year-over-year basis.

Logistics segment contribution margin reflected another inventory impact to earnings relating to its West Texas inventory consisting of a charge totaling $(0.5) million during the second quarter of 2020 compared to a charge of $(0.8) million during the second quarter of 2019.

Retail Segment

For the second quarter 2020, contribution margin was $24.3 million compared to $17.6 million in the prior year period for the retail segment. Merchandise sales were approximately $89.4 million with an average retail margin of 30.8% in the second quarter 2020, compared to merchandise sales of approximately $83.3 million with an average retail margin of 31.2% in the prior-year period. Approximately 42.4 million retail fuel gallons were sold at an average margin of $0.45 per gallon in the second quarter 2020 compared to 53.7 million retail fuel gallons sold at an average margin of $0.29 per gallon in the second quarter 2019. In the second quarter 2020, the average merchandise store count was 253 compared to 277 in the prior year period. On a same store sales basis in the second quarter 2020, merchandise sales increased 13.1% and fuel gallons sold decreased 19.7% compared to the prior-year period.

Retail segment contribution margin reflected another inventory impact to earnings relating to its fuel inventory consisting of a charge totaling $(3.2) million during the second quarter of 2020 compared to no charge during the second quarter of 2019.

Corporate/Other

Contribution margin from Corporate/Other was a loss of $15.5 million in the second quarter 2020 compared to a loss of $9.6 million in the prior-year period. Note, hedging gains (losses) related to the refining segment have been reclassified from the corporate and other segment to the refining segment starting in the first quarter of 2020 and have been retrospectively reclassified in 2019 for comparison purposes.

Corporate/Other segment contribution margin reflected another inventory impact to earnings consisting of a benefit totaling $2.9 million during the second quarter of 2020 compared to no benefit during the second quarter of 2019.

Second Quarter 2020 Results | Conference Call Information

Delek US will hold a conference call to discuss its second quarter 2020 results on Wednesday, August 5, 2020 at 8:30 a.m. Central Time. Investors will have the opportunity to listen to the conference call live by going to www.DelekUS.com and clicking on the Investor Relations tab. Participants are encouraged to register at least 15 minutes early to download and install any necessary software. Presentation materials accompanying the call will be available on the investor relations tab of the Delek US website approximately five minutes prior to the start of the call. For those who cannot listen to the live broadcast, the online replay will be available on the website for 90 days.

Investors may also wish to listen to Delek Logistics' (NYSE: DKL) second quarter 2020 earnings conference call that will be held on Wednesday, August 5, 2020 at 7:30 a.m. Central Time and review Delek Logistics' earnings press release. Market trends and information disclosed by Delek Logistics may be relevant to the logistics segment reported by Delek US. Both a replay of the conference call and press release for Delek Logistics are available online at www.deleklogistics.com.

About Delek US Holdings, Inc.

Delek US Holdings, Inc. is a diversified downstream energy company with assets in petroleum refining, logistics, renewable fuels and convenience store retailing. The refining assets consist of refineries operated in Tyler and Big Spring, Texas, El Dorado, Arkansas and Krotz Springs, Louisiana with a combined nameplate crude throughput capacity of 302,000 barrels per day.

The logistics operations primarily consist of Delek Logistics Partners, LP (NYSE: DKL). Delek US Holdings, Inc. and its affiliates own approximately 71% (including the 2% general partner interest) of Delek Logistics Partners, LP. Delek Logistics Partners, LP is a growth-oriented master limited partnership focused on owning and operating midstream energy infrastructure assets.

The convenience store retail operates approximately 253 convenience stores in central and West Texas and New Mexico.

Safe Harbor Provisions Regarding Forward-Looking Statements

This press release contains forward-looking statements that are based upon current expectations and involve a number of risks and uncertainties. Statements concerning current estimates, expectations and projections about future results, performance, prospects, opportunities, plans, actions and events and other statements, concerns, or matters that are not historical facts are "forward-looking statements," as that term is defined under the federal securities laws. These statements contain words such as "possible," "believe," "should," "could," "would," "predict," "plan," "estimate," "intend," "may," "anticipate," "will," "if", "potential," "expect" or similar expressions, as well as statements in the future tense. These forward-looking statements include, but are not limited to, statements regarding throughput at the Company's refineries; crude oil prices, discounts and quality and our ability to benefit therefrom; share repurchases; returning cash to shareholders; payments of dividends; growth; investments into our business; the performance and execution of our midstream growth initiatives, including the Big Spring Gathering System, the Red River joint venture and the Wink to Webster long-haul crude oil pipeline, and the flexibility, benefits and the expected returns therefrom; RINs waivers and tax credits and the value and benefit therefrom; cash and liquidity; opportunities and anticipated performance and financial position.

Investors are cautioned that the following important factors, among others, may affect these forward-looking statements. These factors include, but are not limited to: uncertainty related to timing and amount of future share repurchases and dividend payments; risks and uncertainties with respect to the quantities and costs of crude oil we are able to obtain and the price of the refined petroleum products we ultimately sell; including uncertainties regarding future decisions by OPEC regarding production and pricing disputes between OPEC members and Russia; uncertainty relating to the impact of the COVID-19 outbreak on the demand for crude oil, refined products and transportation and storage services; risks related to Delek US' exposure to Permian Basin crude oil, such as supply, pricing, gathering, production and transportation capacity; gains and losses from derivative instruments; management's ability to execute its strategy of growth, including risks associated with acquisitions and dispositions; acquired assets may suffer a diminishment in fair value as a result of which we may need to record a write-down or impairment in carrying value of the asset; the possibility of litigation challenging renewable fuel standard waivers;changes in the scope, costs, and/or timing of capital and maintenance projects; the ability to grow the Big Spring Gathering System; the ability of the Red River joint venture to complete the expansion project to increase the Red River pipeline capacity; the ability of the joint venture to construct the Wink to Webster long haul crude oil pipeline; operating hazards inherent in transporting, storing and processing crude oil and intermediate and finished petroleum products; our competitive position and the effects of competition; the projected growth of the industries in which we operate; general economic and business conditions affecting the geographic areas in which we operate; and other risks described in Delek US' filings with the United States Securities and Exchange Commission (the "SEC"), including risks disclosed in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other filings and reports with the SEC.

Forward-looking statements should not be read as a guarantee of future performance or results and will not be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking information is based on information available at the time and/or management's good faith belief with respect to future events, and is subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements. Delek US undertakes no obligation to update or revise any such forward-looking statements to reflect events or circumstances that occur, or which Delek US becomes aware of, after the date hereof, except as required by applicable law or regulation.

Non-GAAP Disclosures:

Our management uses certain "non-GAAP" operational measures to evaluate our operating segment performance and non-GAAP financial measures to evaluate past performance and prospects for the future to supplement our GAAP financial information presented in accordance with U.S. GAAP. These financial and operational non-GAAP measures are important factors in assessing our operating results and profitability and include:

    --  Adjusted net income (loss) - calculated as net income attributable to
        Delek US adjusted for certain identified infrequently occurring items,
        non-cash items and items that are not attributable to our on-going
        operations (collectively, "Adjusting Items") recorded during the period;
    --  Adjusted net income (loss) per share - calculated as Adjusted net income
        (loss) divided by weighted average shares outstanding, assuming
        dilution, as adjusted for any anti-dilutive instruments that may not be
        permitted for consideration in GAAP earnings per share calculations but
        that nonetheless favorably impact dilution;
    --  Earnings before interest, taxes, depreciation and amortization
        ("EBITDA") - calculated as net income attributable to Delek adjusted to
        add back interest expense, income tax expense, depreciation and
        amortization;
    --  Adjusted EBITDA - calculated as EBITDA adjusted for the identified
        Adjusting Items in Adjusted net income (loss) that do not relate to
        interest expense, income tax expense, depreciation or amortization, and
        adjusted to include income (loss) attributable to non-controlling
        interests;
    --  Adjusted Segment Contribution Margin - calculated as Segment
        Contribution Margin adjusted for the identified Adjusting Items in
        Adjusted net income (loss) that impact Segment Contribution Margin;
    --  Refining margin - calculated as the difference between total refining
        revenues and total cost of materials and other;
    --  Adjusted refining margin -- calculated as refining margin adjusted for
        certain identified infrequently occurring items, non-cash items and
        items that are not attributable to our on-going refining operations
        recorded during the period;
    --  Refining margin per sales barrel - calculated as refining margin divided
        by our average refining sales in barrels per day (excluding purchased
        barrels) multiplied by 1,000 and multiplied by the number of days in the
        period; and
    --  Adjusted refining margin per sales barrel - calculated as adjusted
        refining margin divided by our average refining sales in barrels per day
        (excluding purchased barrels) multiplied by 1,000 and multiplied by the
        number of days in the period;

We believe these non-GAAP operational and financial measures are useful to investors, lenders, ratings agencies and analysts to assess our ongoing performance because, when reconciled to their most comparable GAAP financial measure, they provide improved comparability between periods through the exclusion of certain items that we believe are not indicative of our core operating performance and that may obscure our underlying results and trends.

Non-GAAP measures have important limitations as analytical tools, because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures. Additionally, because Adjusted net income or loss, adjusted net income or loss per share, EBITDA and adjusted EBITDA, and Adjusted Segment Contribution Margin or any of our other identified non-GAAP measures may be defined differently by other companies in its industry, Delek US' definition may not be comparable to similarly titled measures of other companies. See the accompanying tables in this earnings release for a reconciliation of these non-GAAP measures to the most directly comparable GAAP measures.



     
              Delek US Holdings, Inc.



     
              Condensed Consolidated Balance Sheets (Unaudited)



     
              (In millions, except share and per share data)


                                                                    June 30,                      December 31,
                                                                        2020                2019




     
              ASSETS



     Current assets:



     Cash and cash equivalents                                                $
       849.0                        $
       955.3



     Accounts receivable, net                                         480.4                 792.6


      Inventories, net of inventory valuation
       reserves                                                        653.5                 946.7



     Other current assets                                             390.0                 268.7



     Total current assets                                           2,372.9               2,963.3




     Property, plant and equipment:



     Property, plant and equipment                                  3,514.9               3,362.8



     Less: accumulated depreciation                               (1,031.5)              (934.5)


      Property, plant and equipment, net                             2,483.4               2,428.3



      Operating lease right-of-use assets                              183.9                 183.6



     Goodwill                                                         855.7                 855.7



     Other intangibles, net                                           110.0                 110.3



     Equity method investments                                        367.3                 407.3



     Other non-current assets                                          64.4                  67.8



     Total assets                                                           $
       6,437.6                      $
       7,016.3





                 LIABILITIES AND STOCKHOLDERS' EQUITY



     Current liabilities:



     Accounts payable                                                       $
       1,004.2                      $
       1,599.7


      Current portion of long-term debt                                 33.4                  36.4


      Obligation under Supply and Offtake
       Agreements                                                       99.0                 332.5


      Current portion of operating lease
       liabilities                                                      43.4                  40.5


      Accrued expenses and other current
       liabilities                                                     409.3                 346.8



     Total current liabilities                                      1,589.3               2,355.9




     Non-current liabilities:


      Long-term debt, net of current portion                         2,421.5               2,030.7


      Obligation under Supply and Offtake
       Agreements                                                      215.0                 144.8


      Environmental liabilities, net of
       current portion                                                 106.3                 137.9



     Asset retirement obligations                                      36.8                  68.6



     Deferred tax liabilities                                         335.4                 267.9


      Operating lease liabilities, net of
       current portion                                                 140.2                 144.3



     Other non-current liabilities                                     33.8                  30.9



     Total non-current liabilities                                  3,289.0               2,825.1




     Stockholders' equity:


      Preferred stock, $0.01 par value,
       11,000,000 shares and 10,000,000
       shares authorized at June 30,2020 and
       December 31, 2019, respectively, no
       shares issued and outstanding


      Common stock, $0.01 par value,
       110,000,000 shares authorized,
       91,232,964 shares and 90,987,025
       shares issued at June 30, 2020 and
       December 31, 2019, respectively                                   0.9                   0.9



     Additional paid-in capital                                     1,160.1               1,151.9


      Accumulated other comprehensive income                             0.5                   0.1


      Treasury stock, 17,575,527 shares and
       17,516,814 shares, at cost, as of June
       30, 2020 and December 31, 2019,
       respectively                                                  (694.1)              (692.2)



     Retained earnings                                                926.4               1,205.6


      Non-controlling interests in
       subsidiaries                                                    165.5                 169.0




     Total stockholders' equity                                     1,559.3               1,835.3



      Total liabilities and stockholders'
       equity                                                                $
       6,437.6                      $
       7,016.3



     
                Delek US Holdings, Inc.



     
                Condensed Consolidated Statements of Income (Unaudited) (1)



     
                (In millions, except share and per share data)


                                                                       Three Months Ended June 30,                    Six Months Ended June 30,


                                                     2020                                          2019           2020                      2019






     Net revenues                                          $
              1,535.5                           $
        2,480.3                          $
          3,356.7            $
        4,680.2



     Cost of sales:


      Cost of materials and other                 1,277.8                                         2,067.7                       3,188.4                   3,767.1


      Operating expenses (excluding
       depreciation and amortization
       presented below)                             103.4                                           135.8                         232.6                     276.7


      Depreciation and amortization                  53.6                                            42.6                         100.6                      81.9




     Total cost of sales                         1,434.8                                         2,246.1                       3,521.6                   4,125.7


      Operating expenses related to
       retail and wholesale business
       (excluding depreciation and
       amortization presented below)                 24.4                                            26.5                          49.7                      52.3


      General and administrative
       expenses                                      61.7                                            69.5                         127.4                     131.7


      Depreciation and amortization                   6.0                                             7.5                          11.6                      15.0


      Other operating income, net                  (14.2)                                          (3.6)                       (14.9)                    (1.2)


      Total operating costs and
       expenses                                   1,512.7                                         2,346.0                       3,695.4                   4,323.5



      Operating income (loss)                        22.8                                           134.3                       (338.7)                    356.7




     Interest expense                               29.8                                            32.8                          66.1                      61.5



     Interest income                               (0.5)                                          (3.3)                        (2.2)                    (5.8)


      Income from equity method
       investments                                 (10.7)                                          (9.3)                       (15.8)                   (11.9)


      Gain on sale on non-operating
       refinery                                    (56.9)                                                                      (56.9)


      Other (income) expense, net                   (1.5)                                            4.9                         (2.4)                      3.5


      Total non-operating (income)
       expense, net                                (39.8)                                           25.1                        (11.2)                     47.3



      Income (loss) before income tax
       (benefit) expense                             62.6                                           109.2                       (327.5)                    309.4


      Income tax (benefit) expense                 (35.9)                                           24.6                       (119.0)                     70.4



      Income (loss) from continuing
       operations, net of tax                        98.5                                            84.6                       (208.5)                    239.0



      Discontinued operations:


      Loss from discontinued
       operations, including gain
       (loss) on sale of discontinued
       operations                                                                                  (1.0)                                                 (1.0)



     Income tax benefit                                                                           (0.2)                                                 (0.2)



      Loss from discontinued
       operations, net of tax                                                                      (0.8)                                                 (0.8)




     Net income (loss)                              98.5                                            83.8                       (208.5)                    238.2


      Net income attributed to non-
       controlling interests                         10.8                                             6.5                          18.2                      11.6


      Net income (loss) attributable to
       Delek                                                   $
              87.7                              $
        77.3                          $
          (226.7)             $
        226.6





      Basic income (loss) per share:


      Income (loss) from continuing
       operations                                              $
              1.19                              $
        1.02                           $
          (3.08)              $
        2.95


      Loss from discontinued operations                                                           (0.01)                 
              $                             $
     (0.01)



      Basic (loss) income per share                            $
              1.19                              $
        1.01                           $
          (3.08)              $
        2.94





      Diluted income (loss) per share:


      Income (loss) from continuing
       operations                                              $
              1.18                              $
        1.01                           $
          (3.08)              $
        2.92


      Loss from discontinued operations                                                           (0.01)                 
              $                             $
     (0.01)



      Diluted (loss) income per share                          $
              1.18                              $
        1.00                           $
          (3.08)              $
        2.91



      Weighted average common shares
       outstanding:



     Basic                                    73,547,582                                      76,598,846                    73,492,656                77,192,763



     Diluted                                  74,028,043                                      77,280,692                    73,492,656                77,883,285



      Dividends declared per common
       share outstanding                                       $
              0.31                              $
        0.28                             $
          0.93               $
        0.55



     
                Delek US Holdings, Inc.



     
                Condensed Cash Flow Data (Unaudited)



     
                (In millions)


                                                        Three Months Ended June 30,                    Six Months Ended June 30,


                                       2020                              2019           2020                     2019

                                                                                                               ---

                   Cash flows from operating
                    activities:


      Net cash (used in)
       provided by
       operating
       activities                             $
             (169.0)                             $
      102.0                           (323.1)              235.4



                   Cash flows from investing
                    activities:


      Net cash used in
       investing
       activities                     (9.3)                                    (202.4)                      (155.9)                         (329.4)



                   Cash flows from financing
                    activities:


      Net cash provided
       by (used in)
       financing
       activities                     242.4                                        62.1                        372.7                           (33.9)



      Net decrease in
       cash and cash
       equivalents                     64.1                                      (38.3)                     (106.3)                         (127.9)


      Cash and cash
       equivalents at the
       beginning of the
       period                         784.9                                       989.7                        955.3                          1,079.3


      Cash and cash
       equivalents of
       continuing
       operations at the
       end of the period                        $
             849.0                              $
      951.4                                  $
        849.0        $
     951.4

COVID-19 Tax Legislative Changes

On March 27, 2020, the Coronavirus Aid Relief, and Economic Security Act (the "CARES Act") was enacted into law. The Act includes several significant provisions for corporations, including the usage of net operating losses, interest deductions and payroll benefits. Pursuant to the provisions of the CARES Act, we recognized $16.8 million of current federal income tax benefit for the three and six months ended June 30, 2020, attributable to anticipated tax refunds from net operating loss carryback to prior 35% tax rate years. Additionally, we recorded an income tax receivable totaling $193 million as of June 30, 2020 related to the net operating loss carryback, which we expect to collect in the first half of 2021. Finally, we deferred $4.4 million of payroll tax payments under the provisions of the CARES Act during the six months ended June 30, 2020, which will be payable in equal installments in December 2021 and December 2022.


                   Delek US Holdings, Inc.


                   Segment Data (Unaudited)


                    (In millions)


                                                                       
      
                Three Months Ended June 30, 2020


                                              Refining                       Logistics                                  Retail                    Corporate, Other
                                                                                                                                                   and Eliminations                          Consolidated



      Net revenues (excluding
       inter-segment fees and
       revenues)                                         $
        1,001.9                                                           $
        27.3                    $
              165.4                                        $
         340.9              $
          1,535.5


      Inter-segment fees and
       revenues                                     75.1                                       90.4                                                                      (165.5)


      Operating costs and
       expenses:


      Cost of materials and
       other                                       928.6                                       43.9                                         119.6                           185.7                             1,277.8


      Operating expenses
       (excluding depreciation
       and amortization
       presented below)                             88.7                                       12.4                                          21.5                             5.2                               127.8


      Segment contribution
       margin                                               $
        59.7                                                           $
        61.4                     $
              24.3                                       $
         (15.5)               $
          129.9



      Depreciation and
       amortization                                         $
        44.8                                                            $
        8.7                      $
              3.3                                          $
         2.8       59.6



      General and
       administrative expenses                                                                                                                                            61.7


      Other operating income,
       net                                                                                                                                                              (14.2)


      Operating income                                                                                                                                                            $
        22.8



      Capital spending
       (excluding business
       combinations)                                        $
        12.2                                                            $
        0.7                      $
              1.3                                          $
         0.8                 $
          15.0





                                                                       
      
                Three Months Ended June 30, 2019


                                            Refining (1)                     Logistics                                  Retail                    Corporate,
                                                                                                                                                       Other and
                                                                                                                                                       Eliminations (1)                          Consolidated



      Net revenues (excluding
       inter-segment fees and
       revenues)                                         $
        2,152.5                                                           $
        93.1                    $
              224.5                                         $
         10.2              $
          2,480.3


      Inter-segment fees and
       revenues                                    215.3                                       62.2                                                                      (277.5)


      Operating costs and
       expenses:


      Cost of materials and
       other                                     2,054.7                                       93.8                                         182.1                         (262.9)                            2,067.7


      Operating expenses
       (excluding depreciation
       and amortization
       presented below)                            115.0                                       17.3                                          24.8                             5.2                               162.3


      Segment contribution
       margin                                              $
        198.1                                                           $
        44.2                     $
              17.6                                        $
         (9.6)               $
          250.3



      Depreciation and
       amortization                                         $
        33.2                                                            $
        6.7                      $
              4.2                                          $
         6.0       50.1



      General and
       administrative expenses                                                                                                                                            69.5


      Other operating income,
       net                                                                                                                                                               (3.6)


      Operating income                                                                                                                                                           $
        134.3



      Capital spending
       (excluding business
       combinations)                                        $
        48.9                                                            $
        1.3                      $
              5.4                                         $
         30.4                 $
          86.0





                   Delek US Holdings, Inc.


                   Segment Data (Unaudited)


                    (In millions)


                                                                        
      
                Six Months Ended June 30, 2020


                                              Refining                       Logistics                                  Retail                    Corporate, Other
                                                                                                                                                   and Eliminations                          Consolidated



      Net revenues (excluding
       inter-segment fees and
       revenues)                                         $
        2,571.1                                                           $
        84.2                    $
              344.0                                        $
         357.4              $
          3,356.7


      Inter-segment fees and
       revenues                                    233.8                                      196.9                                                                      (430.7)


      Operating costs and
       expenses:


      Cost of materials and
       other                                     2,835.2                                      145.2                                         263.7                          (55.7)                            3,188.4


      Operating expenses
       (excluding depreciation
       and amortization
       presented below)                            200.4                                       27.2                                          43.7                            11.0                               282.3



      Segment contribution
       margin                                            $
        (230.7)                                                         $
        108.7                     $
              36.6                                       $
         (28.6)             $
          (114.0)



      Depreciation and
       amortization                                         $
        82.0                                                           $
        15.0                      $
              6.2                                          $
         9.0      112.2



      General and
       administrative expenses                                                                                                                                           127.4


      Other operating income,
       net                                                                                                                                                              (14.9)




     Operating loss                                                                                                                                                           $
        (338.7)



      Capital spending
       (excluding business
       combinations)                                       $
        180.3                                                            $
        3.7                      $
              7.5                                         $
         11.8                $
          203.3





                                                                        
      
                Six Months Ended June 30, 2019


                                            Refining (1)                     Logistics                                  Retail                                   Corporate, Other
                                                                                                                                                                  and E
                                                                                                                                                                   liminations (1)                          Consolidated



      Net revenues (excluding
       inter-segment fees and
       revenues)                                         $
        4,059.9                                                          $
        182.9                    $
              421.7                                         $
         15.7              $
          4,680.2


      Inter-segment fees and
       revenues                                    399.9                                      124.9                                                                      (524.8)


      Operating costs and
       expenses:


      Cost of materials and
       other                                     3,723.8                                      190.1                                         345.5                         (492.3)                            3,767.1


      Operating expenses
       (excluding depreciation
       and amortization
       presented below)                            236.0                                       33.4                                          48.4                            11.2                               329.0


      Segment contribution
       margin                                              $
        500.0                                                           $
        84.3                     $
              27.8                                       $
         (28.0)               $
          584.1



      Depreciation and
       amortization                                         $
        64.3                                                           $
        13.2                      $
              8.5                                10.9                 96.9



      General and
       administrative expenses                                                                                                                                           131.7


      Other operating income,
       net                                                                                                                                                               (1.2)


      Operating income                                                                                                                                                           $
        356.7



      Capital spending
       (excluding business
       combinations)                                       $
        130.5                                                            $
        2.2                     $
              10.5                                         $
         71.1                $
          214.3




              
                (1)              The refining segment results of
                                               operations for the three and
                                               six months ended June 30, 2019,
                                               includes hedging gains, a
                                               component of cost of materials
                                               and other, of $19.8 million and
                                               $27.4 million, respectively,
                                               which was previously included
                                               and reported in corporate,
                                               other and eliminations.


                      Delek US Holdings, Inc.



        
                Schedule of Hedging Gains (Losses)


        
              
                $ in millions


                                                                                
      
          Three Months Ended June 30, 2020


                      Hedging Gains (Losses)
                       Included in Segment
                       Contribution Margin               Refining                     Logistics                               Retail                                           Corporate, Other and                     Consolidated
                                                                                                                                                   Eliminations

    ---

         Unrealized hedging gain
          (loss)                                                    $
        (9.9)                                                       $
        (2.3)               
              $                                                            $
          (11.2)    $
           (23.4)


         Realized hedging gain (loss)                     (137.0)                                       1.3                                                                                           1.7                       (134.0)



         Total hedging gain (loss)                                $
        (146.9)                                                       $
        (1.0)               
              $                                                             $
          (9.5)   $
           (157.4)





                      Delek US Holdings, Inc.



        
                Schedule of Hedging Gains (Losses)


        
              
                $ in millions


                                                                                
      
          Three Months Ended June 30, 2019


                      Hedging Gains (Losses)
                       Included in Segment
                       Contribution Margin               Refining                     Logistics                               Retail                            Corporate, Other and                       Consolidated
                                                                                                                                                   Eliminations

    ---

         Unrealized hedging gain
          (loss)                                                    $
        (6.8)                                                         $
        0.2                
              $                                                               $
          3.0      $
           (3.6)


         Realized hedging gain (loss)                        32.4                                        0.2                                                                                           0.4                          33.0



         Total hedging gain (loss)                                   $
        25.6                                                          $
        0.4                
              $                                                               $
          3.4       $
           29.4





                      Delek US Holdings, Inc.



        
                Schedule of Hedging Gains (Losses)


        
              
                $ in millions


                                                                                 
      
          Six Months Ended June 30, 2020


                      Hedging Gains (Losses)
                       Included in Segment
                       Contribution Margin               Refining                     Logistics                               Retail                            Corporate, Other and                       Consolidated
                                                                                                                                                   Eliminations

    ---

         Unrealized hedging gain
          (loss)                                                     $
        38.7                                             
           $                            
              $                                                            $
          (10.1)      $
           28.6


         Realized hedging gain (loss)                     (105.2)                                       2.1                                                                                         (6.9)                      (110.0)



         Total hedging gain (loss)                                 $
        (66.5)                                                         $
        2.1                
              $                                                            $
          (17.0)    $
           (81.4)





                      Delek US Holdings, Inc.



        
                Schedule of Hedging Gains (Losses)


        
              
                $ in millions


                                                                                 
      
          Six Months Ended June 30, 2019


                      Hedging Gains (Losses)
                       Included in Segment
                       Contribution Margin               Refining                     Logistics                               Retail                            Corporate, Other and                       Consolidated
                                                                                                                                                   Eliminations

    ---

         Unrealized hedging gain
          (loss)                                                   $
        (23.2)                                            
           $                            
              $                                                             $
          (7.5)    $
           (30.7)


         Realized hedging gain (loss)                        67.4                                      (0.6)                                                                                          8.4                          75.2



         Total hedging gain (loss)                                   $
        44.2                                                        $
        (0.6)               
              $                                                               $
          0.9       $
           44.5


                     Refining Segment                                      Three Months Ended June 30,                              Six Months Ended June 30,


                                                             2020                           2019              2020                             2019



                                    Tyler, TX Refinery           
          (Unaudited)                        
             (Unaudited)

    ---


       Days in period                                         91                                       91                                     182                               181


        Total sales volume -
         refined product (average
         barrels per day)(1)                               69,746                                   77,657                                  72,364                            73,863


        Products manufactured
         (average barrels per
         day):



       Gasoline                                           37,225                                   39,997                                  38,633                            39,671



       Diesel/Jet                                         27,897                                   31,505                                  27,650                            29,455


        Petrochemicals, LPG, NGLs                           3,216                                    3,318                                   2,604                             2,690



       Other                                               1,319                                    1,654                                   1,281                             1,411



        Total production                                   69,657                                   76,474                                  70,168                            73,227



        Throughput (average
         barrels per day):



          Crude oil                                       64,408                                   71,918                                  65,187                            68,219


        Other feedstocks                                    5,848                                    5,106                                   5,648                             5,785



        Total throughput                                   70,256                                   77,024                                  70,835                            74,004



        Per barrel of refined
         product sales:


        Tyler refining margin (2)                                   $
           32.72                                 $
              12.15                                      $
       4.62            $
       16.84


        Tyler adjusted refining
         margin (2)                                                 $
           21.24                                 $
              12.12                                     $
       10.32            $
       13.98


        Operating expenses                                           $
           3.00                                  $
              3.65                                      $
       3.38             $
       4.15


        Crude Slate: (% based on
         amount received in
         period)



       WTI crude oil                                        94.2                                     87.7                                    93.3                              89.3
                                                                %                                       %                                      %                                %


        East Texas crude oil                                  5.8                                     12.3                                     6.7                              10.7
                                                                %                                       %                                      %                                %




                                    El Dorado, AR Refinery

    ---


       Days in period                                         91                                       91                                     182                               181


        Total sales volume -
         refined product (average
         barrels per day)(1)                               76,059                                   51,002                                  76,805                            51,717


        Products manufactured
         (average barrels per
         day):



       Gasoline                                           34,346                                   21,821                                  35,376                            21,159



       Diesel                                             30,060                                   17,802                                  28,849                            16,633


        Petrochemicals, LPG, NGLs                           2,063                                      551                                   2,062                               678



       Asphalt                                             6,049                                    6,961                                   6,345                             5,899



       Other                                                 605                                      683                                     788                               661


        Total production                                   73,123                                   47,818                                  73,420                            45,030



        Throughput (average
         barrels per day):



       Crude oil                                          71,406                                   47,935                                  71,514                            44,542


        Other feedstocks                                    2,369                                      359                                   2,506                             1,270


        Total throughput                                   73,775                                   48,294                                  74,020                            45,812



        Per barrel of refined
         product sales:


        El Dorado refining margin                                    $
           3.08                                  $
              8.93                                    $
       (2.74)           $
       11.21


        El Dorado adjusted
         refining margin                                           $
           (4.29)                          8.98                                              $
     (2.74)              $
     10.84


        Operating expenses                                           $
           3.53                                  $
              5.93                                      $
       3.98             $
       6.31


        Crude Slate: (% based on
         amount received in
         period)



       WTI crude oil                                        51.4                                     43.9                                    42.9                              42.6
                                                                %                                       %                                      %                                %


        Local Arkansas crude oil                             14.7                                     29.0                                    17.0                              28.3
                                                                %                                       %                                      %                                %



       Other                                                33.9                                     27.1                                    40.1                              29.1
                                                                %                                       %                                      %                                %


                     Refining Segment                                   Three Months Ended June 30,                             Six Months Ended June 30,


                                                              2020                       2019             2020                             2019



                                    Big Spring, TX Refinery        
        (Unaudited)                     
          (Unaudited)

    ---

        Days in period -based on
         date acquired                                          91                                   91                                    182                       181


        Total sales volume -
         refined product (average
         barrels per day) (1)                               70,679                               78,158                                 54,382                    79,993


        Products manufactured
         (average barrels per
         day):



       Gasoline                                            35,789                               36,428                                 25,198                    37,657



       Diesel/Jet                                          27,924                               26,638                                 18,860                    27,494


        Petrochemicals, LPG, NGLs                            3,563                                3,679                                  2,472                     3,763



       Asphalt                                              2,055                                1,900                                  1,452                     1,707



       Other                                                1,208                                1,354                                    844                     1,296



        Total production                                    70,539                               69,999                                 48,826                    71,917



        Throughput (average
         barrels per day):



       Crude oil                                           70,327                               72,965                                 50,116                    72,649


        Other feedstocks                                     1,483                                (581)                                    78                       648



        Total throughput                                    71,810                               72,384                                 50,194                    73,297



        Per barrel of refined
         product sales:


        Big Spring refining
         margin                                                      $
        7.88                                $
              13.77                             $
        0.71    $
        16.00


        Big Spring adjusted
         refining margin                                             $
        3.76                                $
              13.82                             $
        0.73    $
        15.79


        Operating expenses                                           $
        3.55                                 $
              3.69                             $
        4.89     $
        3.75


        Crude Slate: (% based on
         amount received in
         period)



       WTI crude oil                                         83.9                                 73.3                                   75.1                      76.3
                                                                 %                                   %                                     %                        %



       WTS crude oil                                         16.1                                 26.7                                   24.9                      23.7
                                                                 %                                   %                                     %                        %




                                    Krotz Springs, LA
                                     Refinery

    ---

        Days in period -based on
         date acquired                                          91                                   91                                    182                       181


        Total sales volume -
         refined product (average
         barrels per day) (1)                               61,441                               75,283                                 71,229                    76,749


        Products manufactured
         (average barrels per
         day):



       Gasoline                                            17,461                               34,498                                 24,135                    36,270



       Diesel/Jet                                          21,742                               29,776                                 26,337                    30,082



       Heavy oils                                             215                                1,110                                    473                     1,100


        Petrochemicals, LPG, NGLs                              840                                4,264                                  1,923                     5,758



       Other                                               18,871                                                                     14,704                        52



        Total production                                    59,129                               69,648                                 67,572                    73,262



        Throughput (average
         barrels per day):



       Crude oil                                           59,468                               70,162                                 65,975                    71,240


        Other feedstocks                                     1,114                              (1,327)                                  2,104                       908


        Total throughput                                    60,582                               68,835                                 68,079                    72,148



        Per barrel of refined
         product sales:


        Krotz Springs refining
         margin                                                    $
        (0.64)                                $
              9.69                           $
        (1.12)   $
        10.84


        Krotz Springs adjusted
         refining margin                                           $
        (8.12)                                $
              9.72                           $
        (1.12)   $
        10.36


        Operating expenses                                           $
        3.53                                 $
              4.39                             $
        3.47     $
        4.14


        Crude Slate: (% based on
         amount received in
         period)



       WTI Crude                                             69.7                                 61.0                                   67.7                      62.0
                                                                 %                                   %                                     %                        %


        Gulf Coast Sweet Crude                                30.3                                 39.0                                   32.3                      38.0
                                                                 %                                   %                                     %                        %




     
     (1) Includes inter-refinery sales and
              sales to other segments which are
              eliminated in consolidation. See
              tables below.





     
     (2) Tyler's refining margin per barrel
              and the adjusted refining margin
              per barrel for the second quarter
              2020 both reflect the $111.0
              million margin benefit of
              favorable fixed price crude cost
              transactions during the quarter,
              but exclude the offsetting
              realized hedging losses of
              approximately $(111.0) million.
              Giving effect to the related
              hedging losses, both the refining
              margin per barrel and the adjusted
              refining margin per barrel would
              have decreased by $(17.49). Such
              margin impact was unusually large
              because of the historic volatility
              in the crude commodities market
              during the period.

Included in the refinery statistics above are the following inter-refinery and sales to other segments:


                    Inter-
                     refinery
                     Sales


                                                   Three Months Ended June                      Six Months Ended June
                                                    30,                                     30,


                    (in
                     barrels
                     per day)    2020            2019                 2020              2019

    ---

                              
           (Unaudited)              
              (Unaudited)






        Tyler
         refined
         product
         sales to
         other
         Delek
         refineries             2,190                        914                      1,477             557


        El Dorado
         refined
         product
         sales to
         other
         Delek
         refineries             1,074                        988                        446           1,886


        Big Spring
         refined
         product
         sales to
         other
         Delek
         refineries             1,269                        653                      1,147             903


        Krotz
         Springs
         refined
         product
         sales to
         other
         Delek
         refineries               197                     10,211                        245           5,530


                     Refinery
                      Sales to
                      Other
                      Segments


                                                       Three Months Ended June                      Six Months Ended June
                                                        30,                                     30,


                     (in barrels
                      per day)       2020             2019                 2020              2019

    ---

                                 
            (Unaudited)              
              (Unaudited)




        Tyler refined
         product
         sales to
         other Delek
         segments                   1,592                          24                      2,400              281


        El Dorado
         refined
         product
         sales to
         other Delek
         segments                      11                          58                        169              155


        Big Spring
         refined
         product
         sales to
         other Delek
         segments                  20,570                      25,215                     22,841           26,034


                  Pricing
                   statistics


                  (average for
                   the period
                   presented)


                                             Three Months Ended June 30,                    Six Months Ended June 30,


                               2020                            2019           2020              2019



                                    
         (Unaudited)                       
       (Unaudited)




     WTI -Cushing
      crude oil (per
      barrel)                         $
         29.77                       $
       59.80                                 $
      37.93 $
      57.36


     WTI -Midland
      crude oil (per
      barrel)                         $
         29.77                       $
       57.56                                 $
      37.90 $
      55.65


     WTS --Midland
      crude oil (per
      barrel) (1)                     $
         29.61                       $
       57.93                                 $
      37.69 $
      55.95


     LLS (per
      barrel) (1)                     $
         31.30                       $
       67.06                                 $
      39.73 $
      64.73


     Brent crude oil
      (per barrel)                    $
         33.35                       $
       68.44                                 $
      42.16 $
      66.14




     U.S. Gulf Coast
      5-3-2 crack
      spread (per
      barrel) (1)                      $
         6.67                       $
       17.74                                  $
      8.74 $
      15.77


     U.S. Gulf Coast
      3-2-1 crack
      spread (per
      barrel) (1)                      $
         7.08                       $
       19.24                                  $
      9.32 $
      17.23


     U.S. Gulf Coast
      2-1-1 crack
      spread (per
      barrel) (1)                      $
         2.35                        $
       9.75                                  $
      5.35  $
      8.55




     U.S. Gulf Coast
      Unleaded
      Gasoline (per
      gallon)                          $
         0.81                        $
       1.79                                  $
      1.02  $
      1.66


     Gulf Coast
      Ultra low
      sulfur diesel
      (per gallon)                     $
         0.91                        $
       1.94                                  $
      1.19  $
      1.91


     U.S. Gulf Coast
      high sulfur
      diesel (per
      gallon)                          $
         0.73                        $
       1.80                                  $
      1.04  $
      1.78


     Natural gas
      (per MMBTU)                      $
         1.75                        $
       2.51                                  $
      1.81  $
      2.69




     
     (1) For our Tyler and El Dorado
              refineries, we compare our per
              barrel refining product margin
              to the Gulf Coast 5-3-2 crack
              spread consisting of WTI Cushing
              crude, U.S. Gulf Coast CBOB and
              U.S, Gulf Coast Pipeline No. 2
              heating oil (ultra low sulfur
              diesel).  For our Big Spring
              refinery, we compare our per
              barrel refined product margin to
              the Gulf Coast 3-2-1 crack
              spread consisting of WTI Cushing
              crude, Gulf Coast 87
              Conventional gasoline and Gulf
              Coast ultra-low sulfur diesel,
              and for our Krotz Springs
              refinery, we compare our per
              barrel refined product margin to
              the Gulf Coast 2-1-1 crack
              spread consisting of LLS crude
              oil, Gulf Coast 87 Conventional
              gasoline and U.S, Gulf Coast
              Pipeline No. 2 heating oil (high
              sulfur diesel).  The Tyler
              refinery's crude oil input is
              primarily WTI Midland and east
              Texas, while the El Dorado
              refinery's crude input is
              primarily a combination of WTI
              Midland, local Arkansas and
              other domestic inland crude oil.
              The Big Spring refinery's crude
              oil input is primarily comprised
              of WTS and WTI Midland. The
              Krotz Springs refinery's crude
              oil input is primarily comprised
              of LLS and WTI Midland.



       
                Delek US Holdings, Inc.



       
                Reconciliation of Refining Margin per barrel to Adjusted Refining Margin per barrel (1)


                                                                                                                                                     
         
           $ in millions, except per share data


                                                                  Three Months Ended June 30,                                    Six Months Ended June 30,


                                                2020                              2019                    2020                            2019



                                                   
              (Unaudited)                             
             (Unaudited)


                     Tyler (2)


        Reported refining margin,
         $ per barrel                                   $
              32.72                                      $
              12.15                                $
             4.62                           $
       16.84


                     Adjustments:

    ---

        LCM net inventory
         valuation loss (benefit)            (11.48)                                     (0.03)                                        5.70                             (2.86)




        Adjusted refining margin
         $/bbl                                          $
              21.24                                      $
              12.12                               $
             10.32                           $
       13.98





                     El Dorado (3)


        Reported refining margin,
         $ per barrel                                    $
              3.08                                       $
              8.93                              $
             (2.74)                          $
       11.21


                     Adjustments:

    ---

        LCM net inventory
         valuation loss (benefit)             (7.37)                                       0.05                                                                         (0.37)




        Adjusted refining margin
         $/bbl                                         $
              (4.29)                                      $
              8.98                              $
             (2.74)                          $
       10.84





                     Big Spring (4)


        Reported refining margin,
         $ per barrel                                    $
              7.88                                      $
              13.77                                $
             0.71                           $
       16.00


                     Adjustments:

    ---

        LCM net inventory
         valuation loss (benefit)             (4.12)                                       0.05                                         0.02                             (0.21)




        Adjusted refining margin
         $/bbl                                           $
              3.76                                      $
              13.82                                $
             0.73                           $
       15.79





                     Krotz Springs (5)


        Reported refining margin,
         $ per barrel                                  $
              (0.64)                                      $
              9.69                              $
             (1.12)                          $
       10.84


                     Adjustments:

    ---

        LCM net inventory
         valuation loss (benefit)             (7.48)                                       0.03                                                                         (0.48)




        Adjusted refining margin
         $/bbl                                         $
              (8.12)                                      $
              9.72                              $
             (1.12)                          $
       10.36




     
     (1) Adjusted refining margin per barrel is presented to provide a
              measure to evaluate performance excluding inventory
              valuation adjustments and other items at the individual
              refinery level. Delek US believes that the presentation of
              adjusted measures provides useful information to investors
              in assessing its results of operations at each refinery.
              Because adjusted refining margin per barrel may be defined
              differently by other companies in its industry, Delek US'
              definition may not be comparable to similarly titled
              measures of other companies.





     
     (2) Tyler adjusted refining margins exclude the following items.


                                         Net inventory valuation loss/benefit
                 -There
                                          was approximately $72.8 million and $0.2 million of
                                          valuation benefit in the second quarter 2020 and 2019,
                                          respectively. There was approximately $75.1 million of
                                          valuation loss and $38.3 million of valuation benefit for
                                          the six months ended June 30, 2020 and 2019, respectively.
                                          These amounts resulted from lower of cost or market
                                          adjustments on LIFO inventory in the respective periods.



              Note also that Tyler's refining margin per barrel and the
               adjusted refining margin per barrel for the second quarter
               2020 both reflect the $111.0 million margin benefit of
               favorable fixed price crude cost transactions during the
               quarter, but exclude the offsetting realized hedging losses
               of approximately $(111.0) million. Giving effect to the
               related hedging losses, both the refining margin per barrel
               and the adjusted refining margin per barrel would have
               decreased by $(17.49). Such margin impact was unusually
               large because of the historic volatility in the crude
               commodities market during the period.





     
     (3) El Dorado adjusted refining margins exclude the following
              items.


                                         Net inventory valuation loss/benefit
                 -There
                                          was approximately $51.0 million of valuation benefit as
                                          compared to a $0.3 million of valuation loss in the second
                                          quarter 2020 and 2019, respectively. There was a nominal
                                          amount of valuation benefit and $3.4 million of valuation
                                          benefit for the six months ended June 30, 2020 and 2019,
                                          respectively. These amounts resulted from lower of cost or
                                          net realizable value adjustments on FIFO inventory in the
                                          respective periods.






     
     (4) Big Spring adjusted refining margins exclude the following
              items.


                                         Net inventory valuation loss/benefit
                 -There
                                          was approximately $26.5 million of valuation benefit and
                                          $0.4 million of valuation losses in the second quarter 2020
                                          and 2019, respectively. There was approximately $0.2 million
                                          of valuation loss and $3.0 million of valuation benefit for
                                          the six months ended June 30, 2020 and 2019, respectively.
                                          These amounts resulted from lower of cost or net realizable
                                          value adjustments on FIFO inventory in the respective
                                          periods.






     
     (5) Krotz Springs adjusted refining margins exclude the following
              items.


                                         Net inventory valuation loss/benefit
                 -There
                                          was approximately $41.8 million of valuation benefit and
                                          $0.2 million of valuation loss in the second quarter 2020
                                          and 2019, respectively. There was nominal amount of
                                          valuation benefit and $6.7 million of valuation benefit for
                                          the six months ended June 30, 2020 and 2019,
                                          respectively.These amounts resulted from lower of cost or
                                          net realizable value adjustments on FIFO inventory in the
                                          respective periods.


                  Logistics Segment                           Three Months Ended June 30,                              Six Months Ended June 30,


                                               2020                     2019                2020                      2019



                                                
          (Unaudited)                        
           (Unaudited)


                  Pipelines &
                   Transportation: (average
                   bpd)


     Lion Pipeline System:


     Crude pipelines (non-
      gathered)                              79,066                             37,625                             75,995                            33,179


     Refined products
      pipelines                              56,093                             29,893                             55,110                            26,511


     SALA Gathering System                    9,447                             14,315                             13,449                            14,798


     East Texas Crude
      Logistics System                       10,275                             19,550                             12,224                            18,835




                  Wholesale Marketing &
                   Terminalling:


     East Texas -Tyler
      Refinery sales volumes
      (average bpd) (1)                      65,028                             71,123                             68,839                            69,857


     West Texas wholesale
      marketing throughputs
      (average bpd)                           9,143                             11,404                             12,612                            12,418


     West Texas wholesale
      marketing margin per
      barrel                                        $
            0.64                               $
              6.25                                $
       1.96  $
     4.84


     Big Spring wholesale
      marketing throughputs
      (average bpd)                          76,004                             82,964                             71,195                            85,339


     Terminalling throughputs
      (average bpd) (2)                     138,593                            156,922                            136,961                           154,643




              
                (1)              Excludes jet fuel and
                                               petroleum coke.





              
                (2)              Consists of terminalling
                                               throughputs at our Tyler, Big
                                               Spring, Big Sandy and Mount
                                               Pleasant, Texas, El Dorado
                                               and North Little Rock,
                                               Arkansas and Memphis and
                                               Nashville, Tennessee
                                               terminals.


                            Retail Segment                 Three Months Ended June 30,                      Six Months Ended June 30,


                                             2020                        2019          2020                       2019



                                                
         (Unaudited)                       
           (Unaudited)


               Number of stores
                (end of period)               253                                  263                            253                          263


               Average number of
                stores                        253                                  277                            253                          279


               Retail fuel sales
                (thousands of
                gallons)                   42,436                               53,743                         90,376                      107,633


               Average retail
                gallons sold per
                average number
                of fuel stores
                (in thousands)                171                                  201                            365                          399


               Retail fuel
                margin ($ per
                gallon) (1)                       $
           0.45                             $
            0.29                             $
        0.37   $
       0.25


               Merchandise sales
                (in millions)                     $
           89.4                             $
            83.3                            $
        161.1  $
       158.6


               Merchandise sales
                per average
                number of stores
                (in millions)                      $
           0.4                              $
            0.3                              $
        0.6    $
       0.6


    Merchandise                              30.8                                 31.2                           31.1                         31.1
     margin %                                 %                                   %                             %                           %


     Same-Store               Three Months Ended June
      Comparison (2)             30,                        Six Months Ended June 30,


                         2020                  2019                  2020                 2019



                     
            (Unaudited)              
              (Unaudited)


     Change in same-   (19.7)                          1.7                            (13.9)    3.1
      store fuel            %                                                             %
      gallons sold                                       %                                       %


     Change in same-
      store                 %                                                             %
      merchandise                                        %                                       %
      sales              13.1                         (2.5)                              7.6   (0.5)




              
                (1)              Retail fuel margin represents
                                               gross margin on fuel sales in
                                               the retail segment, and is
                                               calculated as retail fuel sales
                                               revenue less retail fuel cost
                                               of sales. The retail fuel
                                               margin per gallon calculation
                                               is derived by dividing retail
                                               fuel margin by the total retail
                                               fuel gallons sold for the
                                               period.





              
                (2)              Same-store comparisons include
                                               period-over-period increases
                                               or decreases in specified
                                               metrics for stores that were in
                                               service at both the beginning
                                               of the earliest period and the
                                               end of the most recent period
                                               used in the comparison.


                     Delek US Holdings,
                      Inc.


                     Reconciliation of
                      Amounts Reported
                      Under U.S. GAAP


           
              
                $ in millions




                                                               Three Months Ended June 30,                      Six Months Ended June 30,


                     Reconciliation of Net
                      Income (Loss)
                      attributable to Delek
                      to Adjusted Net
                      Income (Loss)                 2020                                   2019        2020                                 2019

    ---

                                                            
        (Unaudited)                                 
      (Unaudited)


                     Reported net income
                      (loss) attributable
                      to Delek                              $
        
                87.7                          $
      
                77.3                $
      
      (226.7)  $
      
      226.6




                                     Adjustments

    ---

        Net inventory
         valuation (benefit)
         loss                                    (203.1)                                          0.6                                     75.1            (51.5)


        Tax effect of
         inventory valuation                        47.7                                         (0.1)                                  (17.7)             12.1



        Net after tax
         inventory valuation
         (benefit) loss                          (155.4)                                          0.5                                     57.4            (39.4)




        Unrealized hedging
         (gain) loss                                23.4                                           3.6                                   (28.6)             30.7


        Tax effect of
         unrealized hedging
         (gain) loss                               (5.3)                                        (0.8)                                     6.5             (6.9)



        Net after tax
         unrealized hedging
         (gain) loss                                18.1                                           2.8                                   (22.1)             23.8




        Gain from sale of
         Bakersfield non-
         operating refinery                       (56.9)                                                                               (56.9)


        Tax effect of gain
         from sale of
         Bakersfield non-
         operating refinery                         12.8                                                                                  12.8



        Net after tax effect
         of gain from sale of
         Bakersfield non-
         operating refinery                       (44.1)                                                                               (44.1)




        Non-operating, pre-
         acquisition
         litigation contingent
         losses and related
         legal expenses                                                                           6.7                                                       6.7


        Tax effect of non-
         operating pre-
         acquisition
         litigation contingent
         losses and related
         legal expenses                                                                         (1.5)                                                    (1.5)



        Net after tax non-
         operating pre-
         acquisition
         litigation contingent
         losses and related
         legal expenses                                                                           5.2                                                       5.2




        Retroactive biodiesel
         tax credit (1)                                                                          11.0                                                      20.7


        Tax effect of
         retroactive biodiesel
         tax credit                                                                             (0.1)                                                    (0.2)



        Net after tax
         retroactive biodiesel
         tax credit                                                                              10.9                                                      20.5




        Discontinued
         operations (income)
         loss                                                                                     1.0                                                       1.0


        Tax effect of
         discontinued
         operations                                                                             (0.2)                                                    (0.2)



        Net after tax
         discontinued
         operations (income)
         loss                                                                                     0.8                                                       0.8




        Tax benefit from loss
         carryback provided by
         CARES Act (2)                            (16.8)                                                                               (16.8)


        Tax adjustment to
         reduce deferred tax
         asset valuation
         allowance resulting
         from Big Springs
         Gathering Assets
         Acquisition                                                                                                                   (22.3)




         Total after tax
          adjustments                            (198.2)                                         20.2                                   (47.9)             10.9




                      Adjusted net income
                       (loss)                            $
        
                (110.5)                         $
      
                97.5                $
      
      (274.6)  $
      
      237.5




     
     (1) An adjustment for the portion of
              the retroactive biodiesel tax
              credit reenacted in December 2019
              that was attributable to 2019 has
              been included in the three and six
              months ended June 30, 2019 for
              comparability.





     
     (2) As a result of the reinstatement of
              the tax-loss carryback provisions
              under the Coronavirus Aid, Relief,
              and Economic Security Act (the
              "CARES" Act), we recognized an
              additional tax benefit in the
              second quarter 2020 from applying
              the carryback to periods with a
              35% tax rate.


                     Delek US Holdings,
                      Inc.


                     Reconciliation of
                      Amounts Reported
                      Under U.S. GAAP


                     per share data


                                                                                Three Months Ended June 30,                     Six Months Ended June 30,


                     Reconciliation of U.S.
                      GAAP Income (Loss)
                      per share to Adjusted
                      Net Income (Loss) per
                      share                                           2020                                  2019       2020                                    2019

    ---

                                                                             
        (Unaudited)                           
           (Unaudited)




                     Reported diluted
                      income (loss) per
                      share                                                  $
        
                1.18                         $
           
                1.00              $
      
      (3.08)  $
      
      2.91




                                     Adjustments, after tax
                                      (per share)

                                                            (1) (2)

    ---

        Adjustment to convert
         reported diluted
         income (loss) per
         share to basic (in
         periods when adjusted
         earnings is a loss
         but we have GAAP net
         income)                                                      0.01


        Net inventory
         valuation loss
         (benefit)                                                  (2.11)                                       0.01                                        0.78           (0.51)


        Unrealized hedging
         (gain) loss                                                  0.25                                        0.04                                      (0.30)            0.30


        Gain from sale of
         Bakersfield non-
         operating refinery                                         (0.60)                                                                                (0.60)


        Non-operating, pre-
         acquisition
         litigation contingent
         losses and related
         legal expenses                                                                                          0.07                                                        0.07


        Retroactive biodiesel
         tax credit                                                                                              0.14                                                        0.26


        Discontinued
         operations (income)
         loss                                                                                                    0.01                                                        0.01


        Tax benefit from loss
         carryback provided by
         CARES Act                                                  (0.23)                                                                                (0.23)


        Tax adjustment to
         reduce deferred tax
         asset valuation
         allowance resulting
         from Big Springs
         Gathering Assets
         Acquisition                                                                                                                                      (0.30)




         Total adjustments                                          (2.68)                                       0.27                                      (0.65)            0.13


                      Adjusted net income
                       (loss) per share                                    $
        
                (1.50)                        $
           
                1.27              $
      
      (3.73)  $
      
      3.04




              
                (1)              The tax calculation is based on
                                               the appropriate marginal income
                                               tax rate related to each
                                               adjustment and for each
                                               respective time period, which
                                               is applied to the adjusted
                                               items in the calculation of
                                               adjusted net income in all
                                               periods.





              
                (2)              For periods of Adjusted net
                                               loss, Adjustments (Adjusting
                                               Items) and Adjusted net loss
                                               per share are presented using
                                               basic weighted average shares
                                               outstanding.


                     Delek US Holdings,
                      Inc.


                     Reconciliation of
                      Amounts Reported
                      Under U.S. GAAP


          
              
                $ in millions




                                                             Three Months Ended June 30,                      Six Months Ended June 30,


                     Reconciliation of Net
                      Income (Loss)
                      attributable to Delek
                      to Adjusted EBITDA           2020                                  2019       2020                                  2019



                                                          
        (Unaudited)                                
        (Unaudited)


                     Reported net income
                      (loss) attributable
                      to Delek                            $
        
                87.7                          $
        
                77.3              $
      
      (226.7)   $
      
      226.6





       Add:


        Interest expense, net                      29.3                                        29.5                                      63.9              55.7


        Income tax (benefit)
         expense -continuing
         operations                              (35.9)                                       24.6                                   (119.0)              70.4


        Depreciation and
         amortization                              59.6                                        50.1                                     112.2              96.9




       EBITDA                                    140.7                                       181.5                                   (169.6)             449.6




                                    Adjustments

    ---

        Net inventory
         valuation (benefit)
         loss                                   (203.1)                                        0.6                                      75.1            (51.5)


        Unrealized hedging
         (gain) loss                               23.4                                         3.6                                    (28.6)             30.7


        Gain from sale of
         Bakersfield non-
         operating refinery                      (56.9)                                                                              (56.9)


        Non-operating, pre-
         acquisition
         litigation contingent
         losses and related
         legal expenses                                                                        6.7                                                        6.7


        Retroactive biodiesel
         tax credit (1)                                                                       11.0                                                       20.7


        Discontinued
         operations (income)
         loss, net of tax                                                                      0.8                                                        0.8


        Net income
         attributable to non-
         controlling interest                      10.8                                         6.5                                      18.2              11.6



         Total adjustments                      (225.8)                                       29.2                                       7.8              19.0




         Adjusted EBITDA                                $
        
                (85.1)                        $
        
                210.7              $
      
      (161.8)   $
      
      468.6




              
                (1)               The portion of the
                                                retroactive biodiesel tax
                                                credit reenacted in December
                                                2019 that was attributable
                                                to 2019 has been added to
                                                the three and six months
                                                ended June 30, 2019.


                     Delek US Holdings, Inc.



       
                Reconciliation of Amounts Reported Under U.S. GAAP


             
              
                $ in millions




                                                                                                         
           
     Three Months Ended June 30, 2020


                     Reconciliation of U.S. GAAP                        Refining               Logistics                    Retail                       Corporate,
                      Segment Contribution Margin                                                                                                             Other
                      to Adjusted Segment                                                                                                                       and
                      Contribution Margin                                                                                                               Eliminations Consolidated

    ---

                     Reported segment contribution
                      margin                                                        $
        59.7                                         $
              61.4                              $
        24.3            $
     (15.5)     $
         129.9




                                    Adjustments

    ---

        Net inventory valuation
         (benefit) loss                                                  (193.7)                          (2.9)                                                (3.2)                    (3.3)   (203.1)


        Unrealized hedging (gain) loss                                       9.9                             2.3                                                                           11.2       23.4



             Total adjustments                                                   $
        (183.8)                                       $
              (0.6)                            $
        (3.2)              $
     7.9    $
         (179.7)



        Adjusted segment contribution
         margin                                                                  $
        (124.1)                                        $
              60.8                              $
        21.1             $
     (7.6)    $
         (49.8)


                     Delek US Holdings, Inc.



       
                Reconciliation of Amounts Reported Under U.S. GAAP


             
              
                $ in millions




                                                                                           
     
              Three Months Ended June 30, 2019


                     Reconciliation of U.S. GAAP                                                                                                           Corporate,
                      Segment Contribution Margin                                                                                                           Other and
                      to Adjusted Segment                                                                                                                 Eliminations
                      Contribution Margin                               Refining              Logistics                                  Retail                        Consolidated

    ---

                     Reported segment contribution
                      margin                                                     $
      198.1                                                       $
      44.2                            $
     17.6              $
       (9.6)      $
      250.3




                                    Adjustments

    ---

        Net inventory valuation
         (benefit) loss                                                      0.6                                                                                                                    0.6


        Unrealized hedging (gain) loss                                       6.8                           (0.2)                                                                             (3.0)                   3.6


        Retroactive biodiesel tax
         credit (1)                                                         11.0                                                                                                                   11.0



             Total adjustments                                                    $
      18.4                                                      $
      (0.2)               
              $                    $
       (3.0)       $
      15.2



        Adjusted segment contribution
         margin                                                                  $
      216.5                                                       $
      44.0                            $
     17.6             $
       (12.6)      $
      265.5


                     Delek US Holdings, Inc.



       
                Reconciliation of Amounts Reported Under U.S. GAAP


             
              
                $ in millions




                                                                                                               
     
            Six Months Ended June 30, 2020


                     Reconciliation of U.S. GAAP                                                                                                          Corporate,
                      Segment Contribution Margin                                                                                                          Other and
                      to Adjusted Segment                                                                                                                Eliminations
                      Contribution Margin                               Refining               Logistics           Retail                                             Consolidated

    ---

                     Reported segment contribution
                      margin                                                     $
        (230.7)                             $
              108.7                                        $
      36.6        $
      (28.6) $
        (114.0)




                                    Adjustments

    ---

        Net inventory valuation
         (benefit) loss                                                     75.3                         (0.1)                                                                         (0.1)   75.1


        Unrealized hedging (gain) loss                                    (38.7)                                                                                                       10.1  (28.6)



             Total adjustments                                                      $
        36.6                              $
              (0.1)                          
              $                  $
      10.0     $
        46.5



        Adjusted segment contribution
         margin                                                                  $
        (194.1)                             $
              108.6                                        $
      36.6        $
      (18.6)  $
        (67.5)


                     Delek US Holdings, Inc.



       
                Reconciliation of Amounts Reported Under U.S. GAAP


             
              
                $ in millions


                                                                                                     
        
     Six Months Ended June 30, 2019


                     Reconciliation of U.S. GAAP                                                                                                Corporate,
                      Segment Contribution Margin                                                                                                Other and
                      to Adjusted Segment                                                                                                      Eliminations
                      Contribution Margin                               Refining          Logistics                Retail                                   Consolidated

    ---

                     Reported segment contribution
                      margin                                                     $
     500.0                                     $
              84.3                           $
     27.8          $
     (28.0)   $
       584.1




                                    Adjustments

    ---

        Net inventory valuation
         (benefit) loss                                                   (51.4)                    (0.1)                                                                        (51.5)


        Unrealized hedging (gain) loss                                      23.2                                                                                            7.5      30.7


        Retroactive biodiesel tax
         credit (1)                                                         20.7                                                                                                    20.7



             Total adjustments                                                   $
     (7.5)                                   $
              (0.1)               
              $                  $
     7.5    $
       (0.1)



        Adjusted segment contribution
         margin                                                                  $
     492.5                                     $
              84.2                           $
     27.8          $
     (20.5)   $
       584.0




     
     (1) An adjustment for the portion of
              the retroactive biodiesel tax
              credit reenacted in December 2019
              that was attributable to 2019 has
              been included in the three and six
              months ended June 30, 2019 for
              comparability.


                                                          Three Months Ended June 30,                       Six Months Ended June 30,


                     Reconciliation of
                      Refining Segment
                      Gross Margin to
                      Refining Margin     2020                                   2019                 2020               2019

    ---

                                       
            (Unaudited)                           
     (Unaudited)


        Net revenues                           $
              1,077.0                            $
        2,367.8                           $
      2,804.9  $
      4,459.8


        Cost of sales                  1,062.1                                  2,202.9                      3,117.6                       4,024.1



        Gross margin                      14.9                                    164.9                      (312.7)                         435.7


        Add back (items
         included in cost of
         sales):


        Operating expenses
         (excluding
         depreciation and
         amortization)                    88.7                                    115.0                        200.4                         236.0


        Depreciation and
         amortization                     44.8                                     33.2                         82.0                          64.3



        Refining margin                          $
              148.4                              $
        313.1                            $
      (30.3)   $
      736.0

Information about Delek US Holdings, Inc. can be found on its website (www.delekus.com), investor relations webpage (ir.delekus.com), news webpage (www.delekus.com/news) and its Twitter account (@DelekUSHoldings).

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SOURCE Delek US Holdings, Inc.