Q1 2023 Delek US Holdings Inc Earnings Call
Cash from operations. In addition, we reduced consolidated debt by $281 million.
Our team executed well in the quarter.
We generated significant earning in the refining segment.
This was achieved despite the Tyler refinery major plant turnaround during the quarter.
With this turnaround behind US, we are well positioned to capture market opportunities as they present themselves we.
We do not have a major turnaround in our system schedule until late Q4 of 2024.
Our logistics segment delivered strong adjusted EBITDA.
This is the results of the investment we've made in our midstream businesses.
As an example.
Compared with last year, we have more than doubled the volume in the Midland gathering system.
We remain focused on our key priorities I'll now take few minutes to provide an update on each and every one of them.
First returning value to shareholders and optimizing our balance sheet.
During the first quarter, we used excess cash to do what we committed to do.
So the Delek U S holdings, we paid down $327 million of debt.
Given the strong performance, we started buying back our sales in the second quarter.
Today, we have up to today, we have repurchased $40 million of vacations.
Also on May <unk>, our board of directors approved four 5% increase to.
The regular dividend.
Second strategic is the vision to create long term value to our shareholders.
Our team is dedicated.
We are working night and day on the sum of the parts initiative.
We continue to make progress.
We are committed to make a long term good decisions that drive shareholder value.
A key focus area since becoming CEO has been safe and reliable operation.
We moved in the right direction during the first quarter.
The Tyler turnaround was completed with zero recordable and on time and on budget.
As of the end of March <unk> employees and contractors have words, combined 4 million man hours with zero lost time injuries.
We are being proactive in our approach to safety.
We are developing and implementing plans that will drive the improvement toward our long term goal of top quartile safety and reliability performance.
Our final key priority is improving efficiency in our cost structure.
We remain focused on this goal.
<unk> will provide additional updates on this effort.
To accomplish our key priorities, we must make sure we have the right people in there at all.
Over the past several months, we have made strategic addition to our team that will position ourselves for future success.
In March we welcome Joseph Israel as EVP of operations.
Joseph is a well rounded industry veteran with over 25 years of energy experience and proven track record of driving safe and reliable operations.
Please join me in welcoming Joseph to the call today.
Patrick Riley has joined us as EVP and Chief commercial officer.
He brings a wealth of experience from best in class businesses, his experience and background aligns well with our vision for future growth.
We have also strengthened our team with Tommy Shabbas, joining us as SVP refining operation.
<unk> brings over 35 years of refining experience.
Our team is strong and well positioned to execute on our strategic plan.
In closing I would like to thank our entire team of over 3500 employees.
Their hard work and dedication are driving our success.
I appreciate the effort and look forward to a strong future together.
I would also like to thank our investors and board of directors for their continued support now.
I will turn the call over to Joseph who will provide additional color on our operations.
Thank you Rodrigo.
I am thrilled to join the Delek family and I have no doubt, our strong talent and competitive position across the system are positioning us well for future success.
Our safe and reliable operations in the first quarter allowed us to leverage favorable market conditions and deliver strong results.
I will now provide additional details about our operations and a slightly modified format with the objective to provide more visibility.
Our performance and plans going forward.
Same thing with our own refinery.
As Eric mentioned the team successfully executed 49 days oil to oil majors tuna beyond routine maintenance and reliability upgrades.
<unk> included yield improvement projects, mainly around the FCC and DHT with an estimated 40 per barrel of margin capture improvement going forward.
Turnaround cost was consistent with our plan at approximately $100 million.
Due to the turnaround total throughput in Tyler in the first quarter was approximately 35000 barrels per day.
Production margin in the quarter was $21 65 per barrel and operating expenses were $8 70 per barrel <unk>.
<unk> approximately $1 25 per barrel of accelerated maintenance due to the turnaround.
In the second quarter. The estimated total throughput in Tyler is in the 74 to 77000 barrels per day range and Opex is expected to go back to the normal range.
$4 50.
To $5 per barrel.
El Dorado.
Throughput in the first quarter was approximately 77000 barrels per day.
Our production margin was $13.38 per barrel.
And operating expenses.
$4 47 per barrel.
Estimated throughput for the second quarter is in the 78 to 81000 barrels per day range.
In Big Spring.
Total throughput for the quarter was consistent with plan at approximately 73000 barrels per day.
The production margin was $18 33 per barrel and operating expenses were $5 80 per barrel, including approximately 60 per barrel of maintenance activities.
The estimated throughput from the second quarter is approximately 70000 barrels per day after completing maintenance work in the month of April .
In Krotz Springs total throughput was approximately 84000 barrels today.
Our production margin was $15 47.
Per barrel and operating expenses were $5.21 per barrel, including 35 cents per barrel maintenance in our reformer and <unk> units.
Plant throughput in the second quarter is in the 80 to 82000 barrels per day range.
Overall.
Estimated system throughput in the second quarter is in the 301 to 311000 barrels per day range compared with approximately 269000 barrels per day.
In the first quarter.
We continue to focus on safety.
Our ability and environmental compliance.
Our top priorities and we expect margin capture and cost performance to follow.
As far as market conditions, good day to be an inland refinery in the U S. GAAP.
Gasoline is tight and going to this summer.
And specifically for the Lake crude oil pricing dynamics are favorable and demand for products is strong across our system.
I will now turn the corner over to Rosie for the financial variants.
Thank you Joseph.
Starting on slide four for.
For the first quarter of 2023, Delek U S had net income of $64 million or <unk> 95 per share.
Adjusted net income was $93 million or $1 37 per share and adjusted EBITDA was $285 million.
Cash flow from operations was $395 million.
On slide five we provide a waterfall of our adjusted EBITDA by segment for the fourth quarter at 2022 to the first quarter of 2023.
A significant improvement over last quarter was primarily from higher results in refining.
As avocado and Joseph mentioned during the quarter, we operated well and we are and we're positioned to capture favorable market condition.
In addition, corporate contributed $16 million benefit over last quarter, primarily due to lower G&A costs.
For your reference we have provided a year over year waterfall slides in the backup.
Moving to slide six to discuss cash flow.
We built $24 million in cash during the quarter.
$395 million and operating activities reflects the strong cash from operations. In addition, it includes approximately $180 million of the $240 million of cash associated with the two year end timing event disclosed during the fourth quarter earnings call.
Investing activities of $222 million is primarily for capital expenditures.
The majority being for the Tyler refinery turnaround.
Financing activities includes the debt pay down during the quarter, partially offset by approximately $16 million cash inflow for the year end timing events.
On slide seven we show capital expenditures first quarter compared with our full year estimate.
For 2023 capital expense will be heavily weighted to the first half of the year.
We still estimate the full year to remain at approximately $350 million.
Net debt is broken out between Gaelic and Delek logistics on slide eight.
During the quarter consolidated net debt improved approximately $303 million and Delek U S. Excluding delek logistics improved $346 million.
The last slide covers outlook items for the second quarter of 2023.
In addition to the throughput guidance Josef provided we expect operating expenses to be between $195 million and $205 million.
G&A to be between 70 and 80 million.
D&A to be between 80, and $90 million and we expect net interest expense to be between $70 million $80 million.
For interest expense, we have updated our guidance to include non cash deferred financing costs.
Prior to the fourth quarter of 2022, when we refinanced various debt facilities the impact of deferred financing cost was less significant.
Before we move on to Q&A, a few update as <unk> mentioned, we have made progress on our cost reduction and process improvement effort. During the quarter. We completed the first phase of this initiative, we realized $3 million of G&A cost savings, which is $12 million on a run rate basis.
The next phase is scheduled to start in the second quarter, and we expect to see G&A improvements in the second half of this year.
Part of our assessment on costs has been a deep dive to drive industry standard on G&A and Opex classification. This quarter, we made an adjustment of approximately $6 million between these costs.
This adjustment was retrospective.
We have provided two years of history in our supplemental slides.
Finally during the quarter, we changed the benchmark for Krotz Springs refinery to better reflect its product mix.
This was also a retrospective change we have provided two years of history in our supplemental slides and detailed disclosures in the supplemental tables of the earnings release we.
We will now open the line for questions.
We will now begin the question and answer session.
Thanks again to ask a question you May Press Star then one on your telephone keypad.
If youre using a speakerphone please pick up your handset before pressing the keys and to withdraw your question. Please press Star then two.
Again, we ask that you please limit yourself to one question and one follow up for this call.
At this time, we will take our first question, which will come from Neil Mehta with Goldman Sachs. Please go ahead with your question.
Yes, thanks, so much and congrats on some good progress here this quarter and Thats, where I want to start off on the refining segment. It looks like even when you adjust for.
The G&A it was better captures the unexpected in our model in particular was at Krotz and Tyler as well and so just curious on anything you could talk about in terms of the refining business, if youre seeing underlying improvements.
Now that we're in a little bit of a tougher margin environment than where we were in Q1 do you think that strength and capture can flow through.
Hey, Neil good morning, its actually got it. Thanks for the question and thank you for the support yes, we have experienced a good day.
Yes, good progress with our initiatives.
First of all we had.
Safe reliable operation always.
He is a key driver and I think that the team. We have is externally focused around that so that's where the focus the execution of the <unk> group great success in our focus and fewer <unk>.
While project that helped us as well.
That's a good opportunity for me to welcome Joseph alive, and they allow him to give some more color around it.
Thank you and good morning Neil.
Yes, the system executed well from a safety and reliability standpoint.
Mentioned throughput capture Opex for the full refineries were in the planned range with Tyler obviously.
Under a turnaround we.
We saw store domestic crude oil efficiently with a more favorable mill.
Midland differentials and the right market structure, we blended low cost butane in our gasoline and then on the distillate.
Distillate side.
We all know the jet fuel was good capture component.
Quarter for all of the finance, including ourselves HST.
Octane priced well to support our capture so good quarter all in all and we're looking forward to the next one.
And welcome Joseph Thank you and then that's the follow up you talked a lot about the path towards some of the parts realization and there is no update here. So can you talk a little bit about.
Where we stand on the plan and what are the different things that you've rolled in and rolled out.
Yeah, Hey, Neely and again, thank you so listen I can tell you that the tenure of the team and Mark is here as well and you can chime in.
After I finish.
Is extremely focused on working on the very extensively.
We continue to make in our mind great progress.
Meaningful progress, but we all understand that those type of transactions take time and more than anything we want to get it right. We do not want to make is to make some something quickly which is not right.
I am very optimistic about it.
The progress is being done very very very very well and we're very satisfied with it.
We'll keep you we'll keep you posted on our modules.
No I think that was well.
Articulated.
We continue to work on it we see opportunities out there.
For us that we're evaluating as I said on our fourth quarter call.
Thing that we're focused on is positioning all of our businesses too.
You have to pursue accretive growth and have financial flexibility. So that continues to be a focus on anything and everything we do.
Just a quick follow up on that market is it fair to say that the area, where you see the best opportunity to unlock value is still around the logistics assets is that what you believe the market is undervalued.
Yes, I think Thats a fair statement.
We obviously have a high value benchmark sort of a marker if you will out there the trades.
Sort of every day.
And we feel like that.
Just given how we're structured right now we're not getting adequate look through value to our to our midstream business.
Thanks, Tim.
And our next question will come from Manav Gupta with UBS. Please go ahead with your question.
You guys, a little bit of a follow up here crops used to be one of your weaker assets.
It's clearly one of the stronger assets at this point of time.
Help us understand.
What has changed in the last one and half or two years to make this a much more competitive asset than what it used to be.
Yes, absolutely.
You want to take it yes I'll start.
Talking about reliability again across this very unique special place. It was just certified as.
The pp plant and I think the stories.
Right.
<unk>.
We have seen great reliability, which was reflected in our yields. In addition, we have a new catalyst in the reformer that really helps our yields.
And.
Providing a small gasoline components.
Components.
Butane blending is really efficient at Krotz Springs, and we make a lot of jet fuel in our crude units. So when jet is strong and recovering krotz springs to kind of do well. So a great team favourable market conditions give us good results and we cannot undermine the important of the alky.
Over the last two quarters do we have to be the final without alky I'll keep pricing was good and we see a nicely 10 12 investment we did years ago.
Makes sense guys. A quick follow up here you mentioned a little bit of this but looks like you have made some improvements at Tyler at in during the <unk> turnaround, which is giving you more confidence of a higher capture help us understand what was executed and what gives you confidence that the captured at Tyler.
Improve and make it more competitive.
Thank you Manav like we said in our prepared remarks beyond just stop reliability projects and the address in Greece.
<unk>.
<unk> done some.
Upgrades.
I think the most significant one.
A revamp of our vacuum dollar which helps in the feed quality to the FCC.
The FCC is performing.
Much better with better conversion better yields in addition will replace the catalyst.
DHT that gives us a much better liquidity recovery and metal soil. So we think this <unk>.
Is just a snapshot on the Eagle Ford to capture those benefits in the future.
Think personally 40 is probably on the conservative side.
Perfect guys I'll leave it there, but I do want to say one thing we are seeing the way you report earnings.
Is improved a lot there's a lot more consistency and I think the feedback we're getting from shareholders is that this is exactly what they wanted so all of those who are involved in making it a lot more consistent and easier to understand reporting would like to congratulate and thank you.
One of the biotech and thank you. Thank you.
And our next question will come from John Royall with Jpmorgan. Please go ahead with your question.
Hi, good morning, Thanks for taking my question.
I'd also like to Echo <unk> comments on the reporting I think that's it.
It's been much easier to get through on earnings days.
So my first question is on capital allocation.
Specifically being out of the buyback market in <unk>.
A big quarter from a cash flow perspective.
Assume it had to do with the turnaround, but any color on that and then.
The 40 million pace.
For <unk> to date is pretty robust is there some catch up there should we think of that as a good pace going forward.
$75 million to $100 million was something you had said for the full year and maybe if you could just comment on that if that's still a good number.
Yes. Thanks, Thank you John for the question.
I will take a bit broader look on our capital allocation. We obviously, we cannot lose sight from the February .
Increasing dividend for three or four quarters and the rollout. So we see that dividend going towards a cycle and we are committed to this.
Much as we can to continue that through the cycles. So that's point number one point.
Number two around the buyback, we obviously wanted to make sure that we are clearing any risk from all of the pool.
<unk> imager.
Significantly with the Taliban.
Behind us and as you probably can know.
We are taking ourself as a first tier.
Return to shareholder company and we are the right you can see is there on the 19, 9% last 12 plus.
The last 12 months, which is which is where we want to be we want to be very competitive and to give a good return to our investors. Both on the short term and on the long term I am not going to change the guidance. We gave today around 75 to 100, but I'm going to say that we are actively looking on that and we are using the buyback.
It's a flex if I can say is the flex tool.
And we have a.
Our solid.
Site for margin and operation, we are still going to do it.
And so that's something we are keep looking at and obviously, if something changed we will come back.
Great. Thanks, I'll have a go and then maybe on the cost reduction program.
Maybe just a little more detail on the $12 million captured.
$30 million to $40 million you expect for this year.
What are the key sources of what you've captured so far in this year's portion of the program in general.
Absolutely John I will let the <unk>.
<unk>, our CFO to comment on that if it's fine.
Thank you Aldo.
First of all our guidance that we gave in the fourth quarter for the year was $30 million to $40 million savings and on a run rate of $90 million to $100 million based on Q4 Slash Q1, 24 that number is divided around 65% between opex and 35% between G&A.
The $3 million, we have materialized in the first quarter our initiatives that we took late in the fourth quarter early in the first quarter and will impact obviously.
The run rate.
30% to 44. This year there are additional I mean, the program goes throughout the year, we have additional.
The segments that we're going to implement in the second quarter and in the fourth quarter. Some of them are IP related some of them are not.
The initial effort was around G&A org.
And structure.
As we progress in the second and third quarters will be more focused on the operation.
Thank you.
And our next question will come from Doug Leggate with Bank of America. Please go ahead with your question.
Thank you. Thanks for taking my question and let me add my.
Welcome to George Nice to actually see by Joe.
Yes.
I Wonder if I could just first of all other gal the some of the policy question again.
To the extent you can if midstream is the.
As soon as the problem what are the range of auctions.
But you are considering in terms of obviously the balance sheet is one question Mark, but how do you how do you see that playing out to the extent you can share at this point.
Your view.
Yeah. So.
Doug It's a great question, but I'm not going to give too much color about that I'm going to say is that we have a line of sight.
That is going to be very accretive to both dk and detail and I'm sure that you're going to you're going to be very happy.
Okay, and retail is that part of the discussion as well or no.
So we want to tackle first would move the needle the most light. So we have our priorities and the priority is to do what is the most meaningful.
His first priority.
And that's how we work here to make sure that we are being as meaningful as we possibly can with the.
Creating value to shareholders.
Just one last one on this topic timing when do you expect to be able to reveal to the market your plan.
So I.
<unk> more aggressive than you and I wanted badly more embedded in <unk>.
So we are on the same side of the equation, but this is not a simple plain vanilla.
Lots of work and planning and detailed so.
We all have the same camp and we want it sooner than later.
Okay.
I don't think we will have a related.
We will watch with interest my follow up is maybe for <unk> I guess, just a housekeeping question, we already tried to walk through with.
Rosy, but I think it would be good for everyone to hear that Youre cash flow was obviously pretty strong, but you don't breakout at least not in the release the working capital moves. So we're trying to understand what the I guess the underlying cash flow was in the quarter and more importantly, how much of the working capital is will.
We will reverse in the future in other words is this a one time benefit or is it.
Something be Cunard, we can look to is more of an underlying improvement.
So the underlying cash flow. Our guess is a question on the nature of the working capital.
So thank you for the question.
I think the one number to remember is on the fourth quarter call. We mentioned that we had a timing issue with the intermediation.
The agreement with the city and $180 million are supposed to come in in January and they did come in and I think that is the number that probably.
Should be taken out of that.
The reported number because that was a fourth quarter event that reconciled itself in the first quarter other than that what impacted the working capital is less cash flow was the Tyler turnaround.
And.
On the negative side, the capital expenditure, which was higher in the first quarter as expected.
And below the operating line Rubin.
140, the difference in depth in the financing activities.
Alright.
That makes up the 40 40 right.
Got it thanks, so much.
I appreciate it.
And our next question will come from Matthew Blair with Tudor Pickering Holt. Please go ahead with your question.
Hey, good morning, Thanks for taking my questions.
Joseph It looks like southwest cracks are still at new five year highs, whereas most other regions are roughly around five year averages or even a little bit below could you talk about the drivers that are supporting the strong margin environment in the southwest and is that something that you can capitalize on in Q2 or does the big spring.
Maintenance in April .
The picture there.
Yes. Thanks for the question actually we are very optimistic about what we see on the demand side, we see it.
Strong net backs and the strong pull form already rocks.
Demand in dollars type in our side of the world looks a solid that this could be.
There is a different discussion in the macro and the macro and the Mako in our inland is a solid and robust and we see that on the results.
And if I can add.
The southwest market, you're right is probably the strongest in the country. This days and Fortunately this is where a lot of our businesses. So you can see it in the op is Iraq versus Gulf Coast and we capture.
That and it's coming back to the refining not through the big spring number but.
Definitely through our profitability.
As far as the second quarter dynamics and US specifically in Big Spring look we think the fundamentals are favorable from inventory standpoint try come in gasoline is type going to the summer global economic trends are still a concern, but we don't have <unk>.
Mr Ball to predict future trends, but the great thing about our system, we are well insulated within our niche markets, we have seen strong demand.
Going into April and the marketing uplift really reflect our location advantage, we continue to leverage our advantaged crude pricing octane capabilities and now asphalt capabilities as we move through the second quarter.
Okay sounds good and then on the retail side. It looks like your same store volumes were down one 7% Q1 do you have a rough number on what that's looking like so far in Q2.
So we are not going to give there.
The forecast for Q2.
But we are going to sell on the other side merchandise was higher so all in all our retail is doing good.
Okay. Thank you very much.
And our next question will come from Paul Cheng with Scotiabank. Please go ahead with your question.
Guys good morning.
Okay.
Two question please.
John .
Hopefully that simple maybe as Paul Rubin.
Trading and supply again.
First quarter, you have some thoughts about 18 mainland and last year's 100.
Five yes.
I wanted to also just.
One sign up to it.
To trade that you loss on OUI, Pablo SBA, and then you're accurate.
David we are not.
The hedge gain on.
On the other side on the vehicle market.
Physical barrel, so just trying to understand what the user will also at that sort of late <unk>.
How do we pulled yet David.
Loss of a one contribute to the loss.
The second question, maybe is for ever done that.
How important is M&A.
Acquisition for your strategy over the next three years.
In refining.
And retail and that's important.
Or even maybe it is not.
Kind of financial metrics, you would be using when you are.
Looking at potential.
Pockets. Thank you.
Yes, so part of its operation I will start with the strategic question and then we'll talk with Golar to tactics. So M&A is obviously a told itself delek in the past very successfully and very good and but M&A, we're going to do it only if we are going to be disciplined tight and when I mean disciplined it's going to be accretive for investor we are not.
Going to do M&A just to check the box, we're going to do it when it makes sense for <unk>.
Synergetic and we can drive value for shareholders built end of story Thats, what going to divest.
Obviously on the refining side, its more accretive versus retail, which is 10 times. So we're not probably going to do M&A on the retail side, because it's not it's not the case.
So therefore, the strategic strategic side, but we're obviously looking and if we find something that will make sense on the short term and in the long term.
We will not shy about that we will not shy about that in the past, but again, it's going to be a cadence that makes sense around the split between refining.
All the technicalities in front of me, Paul, but there is nothing with them in those in the and that is mainly the way we split between refining and the different assets. So.
I can ask cause it to look into that and come back to you with more color I don't have a department.
Ken can I ask that on.
Refining <unk>.
Do you go into it and the acquisition.
Yes.
Particular regions that you would be interested or that you are not really focusing on the region.
So.
Again, we are not going to be specific but I think the rules that we have it's we need to have add value to any assets to be accretive and we are not going to hurt ourselves satisfied Paul we're going to make something that is going to make sense for the long term and can they bring.
And going to be accretive for our share price.
So there is no loss, but its something going to come up with new type.
Okay.
Thank you you bet.
Thank you. Thank you Paul.
Yeah.
And our next question will come from Jason <unk> with Cowen. Please go ahead with your question.
Good morning, Thanks for taking my questions.
I wanted to first go back to capital allocation and pay down a lot of debt and one Q.
Does that get the parent balance sheet.
In an appropriate place excluding MLP debt.
Or do you want to pay down.
Additional data.
Kind of on the topic of the.
Our balance sheet and capital allocation you had previously discussed.
To one ratio between buybacks and debt pay down is that kind of.
The right split moving forward or do you have a different.
<unk>.
Allocation plan going forward. Thanks.
Yeah. So thank you for the question I'll start and then the.
We'll continue so.
The Dk side.
We are probably have the best balance sheet, among our peers with only two out of the $1 million.
Most of our debt as you well know who is on the.
<unk> side that has a completely different level of.
Income against it so two different ballgame, and we cannot lose sight of that and obviously we have.
Very high level of third party income.
That's the philosophy behind it so we said in the past and we are sticking to it especially on a higher interest environment that we are that we will have a balanced approach between reducing debt.
<unk> and <unk>.
Buyback, we demonstrate in the last four months that we are not shy of doing buybacks and the market continues to be good we will use that tool in the past in the future like music in the past maybe.
Maybe you can.
Sure well thank you <unk>.
As you recall during the fourth quarter, we had to increase our debt as a result of the intermediation agreement timing so going into the first quarter. We had two priorities one is to pay down that debt and the other one was to support the elevated capital expenditure level of the first quarter, which were mainly as a result of the dialogue.
Turnaround.
Once we realize that we can accomplish that and it's a very strong quarter.
We did additional $60 million of debt from the original plan, which put us at the 300 range and we started the buyback.
Buyback program, and we bought $40 million.
Got it and just one clarifying question on that so going forward do you expect to be balanced between buybacks and debt.
Hey, Paydown or does it swing back the other way just given <unk> debt pay down was so high.
Yes, so we didn't change the philosophy.
But it doesn't mean that the market conditions change with no change versus what we do.
As we said our philosophy is terrific.
Return to shareholder and we are still around it and we'll keep being first around that so we are taking a buyback.
The priority obviously interest rate is where it is so.
We're going to do both as effective as we possibly can.
Okay understood and my follow up is on corporate expenses those came in a lot lower than expected.
And <unk> what.
Drove that it doesn't seem like you expect that.
To repeat in the second quarter. So just wondering what the variance was in the first quarter. Thanks.
Yes, when you want to take that.
So it's actually a composition of three numbers.
As part of our cost.
Our reduction efforts, we review every line item and we reclassified 6 million.
From G&A to Opex, which is in line with industry practices and our peers.
In addition to that there were $3 million of timing.
The expense and the last component, which is the 3 million that is directly related to the cost efficiency steps that were taken late in the fourth quarter early in the in the first quarter, which will impact.
G&A for the remainder of the year with.
With about $200 million.
Great. Thanks.
Thank you.
And our next question will be a follow up from Paul Cheng with Scotiabank. Please go ahead with your follow up.
Hey, guys real quick.
Evergreen Devon Youre looking at logistics have you guys ever consider.
Similar to what some of your peers that to roll up that that too and so.
You spin it off or doing other things that actually.
Michael <unk> public unitholders.
And secondly that do you have a number you can share what is the Vietnam gain.
And the wind expansion in the quarter.
Any meaningful number and also debt.
Can talk about what is in your hedging strategy going forward.
Yes.
Thanks, Paul for the follow up.
Let's start one by one.
Buying back the asset.
We said that we believe that we have a good vehicle understand we understand why other fields did what we did what they do.
And we'll come back to you again, when we have something meaningful to share.
We believe that we have much more accretive way for everyone going forward is that we have seen other the dividend was not as successful as they expected so.
We have we believe we have a more meaningful way to do it that's going to be better from a leverage and.
The accretive for both the Dk and.
And regarding the rain, we historically didn't.
Provide.
Special guidance or information around it but this quarter I'm sure that we are very pleased from all the new information. We got so we are moving very fast on the on the other direction to give a lot of a lot of clarity.
Alright, Thank you you.
You bet. Thank you for the question.
And that concludes our question and answer session I would like to turn the conference back over to <unk> for any closing remarks, yes. Thank you.
They invest or the board of directors and mainly our employees.
Great.
Distribution.
Our first priority is to have safe and reliable operation and to have a greater return to shareholders and we are committed to do so thank you for your time and therefore I appreciate it.
Okay.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.