Delek Logistics Partners, LP reported record adjusted EBITDA of $136.0 million for the third quarter of 2025, a 27 % year‑over‑year increase from $106.8 million in the same period last year. Net income rose 35 % to $45.6 million, while revenue reached $261.28 million, beating the consensus estimate of $251.65 million to $253.62 million. The company’s earnings per share of $0.85 fell short of the analyst expectation of $0.97 to $1.04, marking an EPS miss that tempered the otherwise strong financial performance.
The revenue beat was driven by robust demand in the Permian and Delaware Basins, with record crude gathering volumes and accelerated progress on the Libby II gas‑processing expansion. However, the EPS miss can be attributed to higher operating costs and a one‑time charge related to the integration of recent acquisitions, which offset the margin gains from the higher throughput. Management noted that “strong execution, record crude gathering volumes, and progress on the Libby Complex” were key contributors to the quarter’s performance, but also acknowledged that “cost inflation and integration expenses” weighed on profitability.
Management raised its full‑year EBITDA guidance to $500 million–$520 million, up from the previously reiterated $480 million–$520 million range. The upward revision signals confidence in continued demand growth and the successful scaling of the company’s third‑party‑focused midstream model. The quarterly distribution was increased to $1.120 per unit, marking the 51st consecutive hike, and the distributable cash‑flow coverage ratio was reported at 1.24×, reflecting a modest improvement from 1.09× in Q3 2024.
Despite the operational strengths, the company’s financial health shows emerging concerns. Leverage stands at 4.44×, and the current ratio is below 1, indicating potential liquidity pressure. An Altman Z‑Score in the distress zone further highlights the risk profile. Additionally, a significant rise in related‑party accounts receivable from parent Delek Holdings introduces counterparty risk that could impact cash flow stability.
Investors reacted cautiously to the earnings release. The EPS miss, despite a revenue beat and raised guidance, was the primary driver of the muted market response. Management’s emphasis on disciplined cost management and continued investment in high‑return infrastructure projects suggests a focus on sustaining long‑term growth while addressing the identified financial risks.
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