Delek Reports A Profit Despite Falling Revenue

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On March 5, 2009, Delek US Holdings ( DK) reported a net profit during Q4 FY08, helped by a significant decline in operating costs and expenses. Net income stood at $2.10 million or $0.04 per share compared to a loss of $12.10 million or $0.23 per share in the prior year's quarter. Excluding special items, income from continuing operations was $18.00 million or $0.33 per share, which beat the most recent consensus estimate of a loss of $0.05 per share.

Total revenue plunged 38.3% to $658.10 million from $1.07 billion a year ago due to lower revenue across segments. Looking at the company's business segments, revenue from the Refining segment slipped 51.0% to $237.20 million from $484.50 million, while total production increased 15.5% to 60,553 barrels per day from 52,424 barrels per day in the year-ago quarter. Revenue from the Retail segment dipped 24.3% to $322.90 million from $426.30 million, as sales fell 6.7% to 99.23 million gallons from 106.41 million gallons in Q4 FY07. Finally, revenue from the Marketing segment dived 37.4% to $97.80 million from $156.30 million, as total sales decreased 12.0% to 14,297 barrels per day from 16,246 barrels per day on a year-over-year basis.

Delek US Holdings Inc. temporarily halted production at its 60,000-barrel-per-day Tyler, Texas refinery due to fire. The company had 458 stores at the end of December 31, 2008, compared to 461 a year ago.

The company recently declared a quarterly cash dividend of $0.0375 per share, payable on March 11, 2009.

For FY08, total revenue increased 18.3% to $4.62 billion from $3.90 billion in the previous year. Net income plummeted 72.5% to $26.50 million or $0.49 per share from $96.40 million or $1.82 per share in FY07.

Looking forward, the company anticipates that its Tyler refinery will resume production in May 2009.

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