MMLP Martin Midstream Partners LP

• Net income of $3.8 million and $7.1 million for the three and six months ended June 30, 2024, respectively
• Adjusted EBITDA of $31.7 million and $62.1 million for the three and six months ended June 30, 2024, respectively
• Total adjusted leverage of 3.88 times as of June 30, 2024
• Declares quarterly cash dividend of $0.005 per common unit

Martin Midstream Partners L.P. (Nasdaq: MMLP) (“MMLP” or the “Partnership”) today announced its financial results for the second quarter of 2024.

Bob Bondurant, President and Chief Executive Officer of Martin Midstream GP LLC, the general partner of the Partnership, stated, “For the second quarter of 2024, the Partnership exceeded guidance by $0.5 million with adjusted EBITDA of $31.7 million compared to guidance of $31.2 million. Within our Transportation Services segment the land division continued to outperform projections assisted by higher than forecasted mileage along with lower maintenance expense. The marine division, however, was negatively impacted by a casualty loss reserve of $0.5 million from a bridge allision that occurred in May. The marine division also experienced lower fleet utilization this quarter as a result of both the allision and extended time of equipment in dry dock for regulatory inspection compared to forecasted duration.”

“The Sulfur Services segment results were above guidance as the division benefited from strong fertilizer margins and high sulfur production from the Gulf Coast refineries. Results in the Specialty Products segment were in line with guidance as strength in our grease division offset underperformance by the packaged lubricants business. Finally, the Terminalling and Storage segment results were below guidance as a direct result of a $1.5 million casualty loss reserve related to the previously announced crude oil spill from a crude pipeline that connects our Sandyland Terminal to the Smackover refinery.”

SECOND QUARTER 2024 OPERATING RESULTS BY BUSINESS SEGMENT

 

Operating Income

(Loss) ($M)

 

Adjusted EBITDA,

After Giving Effect to

the Exit of the Butane

Optimization

Business ($M)

 

Adjusted EBITDA ($M)

 

Three Months Ended June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

 

(Amounts may not add or recalculate due to rounding)

Business Segment:

 

 

 

 

 

 

 

 

 

 

 

Terminalling and Storage

$

3.3

 

 

$

4.4

 

 

$

8.0

 

 

$

9.6

 

 

$

8.0

 

 

$

9.6

 

Transportation

 

8.0

 

 

 

9.0

 

 

 

11.2

 

 

 

12.1

 

 

 

11.2

 

 

 

12.1

 

Sulfur Services

 

7.5

 

 

 

5.3

 

 

 

10.6

 

 

 

8.0

 

 

 

10.6

 

 

 

8.0

 

Specialty Products

 

4.9

 

 

 

2.5

 

 

 

5.7

 

 

 

5.9

 

 

 

5.7

 

 

 

(0.4

)

Unallocated Selling, General and Administrative Expense

 

(3.8

)

 

 

(3.9

)

 

 

(3.8

)

 

 

(3.9

)

 

 

(3.8

)

 

 

(3.9

)

 

$

19.9

 

 

$

17.3

 

 

$

31.7

 

 

$

31.8

 

 

$

31.7

 

 

$

25.5

 

Terminalling and storage adjusted EBITDA decreased $1.6 million, primarily reflecting the $1.5 million casualty loss reserve related to the crude oil spill from a crude pipeline that connects our Sandyland Terminal to the Smackover refinery. This casualty loss reserve was coupled with higher employee-related expenses across our divisions, offset by increased throughput in our shore-based terminals and underground NGL storage divisions.

Transportation adjusted EBITDA decreased $0.9 million, reflecting higher expenses in our marine division related to a casualty loss reserve of $0.5 million stemming from a bridge allision that occurred in May. This was coupled with lower fleet utilization as a result of both the allision and an acceleration of equipment into dry dock for regulatory inspection. Our marine division was positively impacted during the quarter by higher day rates. The land division experienced increased operating expenses, offset by increased mileage and transportation rates.

Sulfur services adjusted EBITDA increased $2.6 million, primarily reflecting increased fertilizer margins and high sulfur production from the Gulf Coast refineries.

Specialty products adjusted EBITDA, after giving effect to the exit of the butane optimization business, decreased $0.2 million, reflecting decreased margins in our NGL marketing business, offset by higher margins in our grease division.

Unallocated selling, general, and administrative expense decreased $0.1 million, reflecting reduced overhead expenses allocated from Martin Resource Management.

CAPITALIZATION

 

June 30, 2024

 

December 31, 2023

 

($ in millions)

Debt Outstanding:

 

 

 

Revolving Credit Facility, Due February 2027 1

$

58.0

 

$

42.5

Finance lease obligations

 

0.1

 

 

—

11.50% Senior Secured Notes, Due February 2028

 

400.0

 

 

400.0

Total Debt Outstanding:

$

458.1

 

$

442.5

 

 

 

 

Summary Credit Metrics:

 

 

 

Revolving Credit Facility - Total Capacity

$

150.0

 

$

175.0

Revolving Credit Facility - Available Liquidity

$

82.9

 

$

109.0

Total Adjusted Leverage Ratio 2

3.88x

 

3.75x

Senior Leverage Ratio 2

0.49x

 

0.36x

Interest Coverage Ratio 2

2.24x

 

2.19x

 

1 The Partnership was in compliance with all debt covenants as of June 30, 2024 and December 31, 2023. 

2 As calculated under the Partnership's revolving credit facility. 

     

RESULTS OF OPERATIONS SUMMARY (in millions, except per unit amounts)

Period

 

Net

Income

 

Net

Income

Per Unit

 

Adjusted

EBITDA

 

Adjusted

EBITDA,

After Giving

Effect to the

Exit of the

Butane

Optimization

Business

 

Net Cash

Provided by

Operating

Activities

 

Distributable

Cash Flow

 

Revenues

 

Three Months Ended June 30, 2024

 

$

3.8

 

$

0.09

 

$

31.7

 

$

31.7

 

$

11.8

 

$

9.5

 

$

184.5

Three Months Ended June 30, 2023

 

$

1.1

 

$

0.03

 

$

25.5

 

$

31.8

 

$

49.5

 

$

9.7

 

$

195.6

EBITDA, adjusted EBITDA, distributable cash flow and adjusted free cash flow are non-GAAP financial measures which are explained in greater detail below under the heading "Use of Non-GAAP Financial Information." The Partnership has also included below a table entitled "Reconciliation of EBITDA, Adjusted EBITDA, Distributable Cash Flow and Adjusted Free Cash Flow" in order to show the components of these non-GAAP financial measures and their reconciliation to the most comparable GAAP measurement.

An attachment included in the Current Report on Form 8-K to which this announcement is included contains a comparison of the Partnership’s adjusted EBITDA for the second quarter 2024 to the Partnership's adjusted EBITDA guidance for the second quarter 2024.

QUARTERLY CASH DISTRIBUTION

The Partnership has declared a quarterly cash distribution of $0.005 per unit for the quarter ended June 30, 2024. The distribution is payable on August 14, 2024 to common unitholders of record as of the close of business on August 7, 2024. The ex-dividend date for the cash distribution is August 7, 2024.

Qualified Notice to Nominees

This release is intended to serve as qualified notice under Treasury Regulation Section 1.1446-4(b)(4) and (d). Brokers and nominees should treat one hundred percent (100%) of MMLP’s distributions to non-U.S. investors as being attributable to income that is effectively connected with a United States trade or business. Accordingly, MMLP’s distributions to non-U.S. investors are subject to federal income tax withholding at the highest applicable effective tax rate. For purposes of Treasury Regulation section 1.1446(f)-4(c)(2)(iii), brokers and nominees should treat one hundred percent (100%) of the distributions as being in excess of cumulative net income for purposes of determining the amount to withhold. Nominees, and not Martin Midstream Partners L.P., are treated as withholding agents responsible for any necessary withholding on amounts received by them on behalf of foreign investors.

Investors' Conference Call

Date: Thursday, July 18, 2024 Time: 8:00 a.m. CT (please dial in by 7:55 a.m.) Dial In #: (888) 330-2384 Conference ID: 8536096 Replay Dial In # (800) 770-2030 – Conference ID: 8536096

A webcast of the conference call along with the Second Quarter 2024 Earnings Summary will also be available by visiting the Events and Presentations section under Investor Relations on our website at www.MMLP.com.

About Martin Midstream Partners

Martin Midstream Partners LP, headquartered in Kilgore, Texas, is a publicly traded limited partnership with a diverse set of operations focused primarily in the Gulf Coast region of the United States. MMLP’s primary business lines include: (1) terminalling, processing, and storage services for petroleum products and by-products; (2) land and marine transportation services for petroleum products and by-products, chemicals, and specialty products; (3) sulfur and sulfur-based products processing, manufacturing, marketing and distribution; and (4) marketing, distribution, and transportation services for natural gas liquids and blending and packaging services for specialty lubricants and grease. To learn more, visit www.MMLP.com. Follow Martin Midstream Partners L.P. on LinkedIn, Facebook, and X (formerly known as Twitter).

Forward-Looking Statements

Statements about the Partnership’s outlook and all other statements in this release other than historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements and all references to financial estimates rely on a number of assumptions concerning future events and are subject to a number of uncertainties, including (i) the effects of the continued volatility of commodity prices and the related macroeconomic and political environment and (ii) other factors, many of which are outside its control, which could cause actual results to differ materially from such statements. While the Partnership believes that the assumptions concerning future events are reasonable, it cautions that there are inherent difficulties in anticipating or predicting certain important factors. A discussion of these factors, including risks and uncertainties, is set forth in the Partnership’s annual and quarterly reports filed from time to time with the Securities and Exchange Commission (the “SEC”). The Partnership disclaims any intention or obligation to revise any forward-looking statements, including financial estimates, whether as a result of new information, future events, or otherwise except where required to do so by law.

Use of Non-GAAP Financial Information

To assist management in assessing our business, we use the following non-GAAP financial measures: earnings before interest, taxes, and depreciation and amortization ("EBITDA"), adjusted EBITDA (as defined below), distributable cash flow available to common unitholders (“distributable cash flow”), and free cash flow after growth capital expenditures and principal payments under finance lease obligations ("adjusted free cash flow"). Our management uses a variety of financial and operational measurements other than our financial statements prepared in accordance with U.S. GAAP to analyze our performance.

Certain items excluded from EBITDA and adjusted EBITDA are significant components in understanding and assessing an entity's financial performance, such as cost of capital and historical costs of depreciable assets.

EBITDA and adjusted EBITDA. We define adjusted EBITDA as EBITDA before unit-based compensation expenses, gains and losses on the disposition of property, plant and equipment, impairment and other similar non-cash adjustments. Adjusted EBITDA is used as a supplemental performance and liquidity measure by our management and by external users of our financial statements, such as investors, commercial banks, research analysts, and others, to assess:

• the financial performance of our assets without regard to financing methods, capital structure, or historical cost basis;
• the ability of our assets to generate cash sufficient to pay interest costs, support our indebtedness, and make cash distributions to our unitholders; and
• our operating performance and return on capital as compared to those of other companies in the midstream energy sector, without regard to financing methods or capital structure.

The GAAP measures most directly comparable to adjusted EBITDA are net income (loss) and net cash provided by (used in) operating activities. Adjusted EBITDA should not be considered an alternative to, or more meaningful than, net income (loss), operating income (loss), net cash provided by (used in) operating activities, or any other measure of financial performance presented in accordance with GAAP. Adjusted EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate adjusted EBITDA in the same manner.

Adjusted EBITDA does not include interest expense, income tax expense, and depreciation and amortization. Because we have borrowed money to finance our operations, interest expense is a necessary element of our costs and our ability to generate cash available for distribution. Because we have capital assets, depreciation and amortization are also necessary elements of our costs. Therefore, any measures that exclude these elements have material limitations. To compensate for these limitations, we believe that it is important to consider net income (loss) and net cash provided by (used in) operating activities as determined under GAAP, as well as adjusted EBITDA, to evaluate our overall performance.

Distributable cash flow and adjusted free cash flow. We define distributable cash flow as net cash provided by (used in) operating activities less cash received (plus cash paid) for closed commodity derivative positions included in Accumulated Other Comprehensive Income (Loss), plus changes in operating assets and liabilities which (provided) used cash, less maintenance capital expenditures and plant turnaround costs. Distributable cash flow is a significant performance measure used by our management and by external users of our financial statements, such as investors, commercial banks and research analysts, to compare basic cash flows generated by us to the cash distributions we expect to pay unitholders. Distributable cash flow is also an important financial measure for our unitholders since it serves as an indicator of our success in providing a cash return on investment. Specifically, this financial measure indicates to investors whether or not we are generating cash flow at a level that can sustain or support an increase in our quarterly distribution rates. Distributable cash flow is also a quantitative standard used throughout the investment community with respect to publicly-traded partnerships because the value of a unit of such an entity is generally determined by the unit's yield, which in turn is based on the amount of cash distributions the entity pays to a unitholder.

We define adjusted free cash flow as distributable cash flow less growth capital expenditures and principal payments under finance lease obligations. Adjusted free cash flow is a significant performance measure used by our management and by external users of our financial statements and represents how much cash flow a business generates during a specified time period after accounting for all capital expenditures, including expenditures for growth and maintenance capital projects. We believe that adjusted free cash flow is important to investors, lenders, commercial banks and research analysts since it reflects the amount of cash available for reducing debt, investing in additional capital projects, paying distributions, and similar matters. Our calculation of adjusted free cash flow may or may not be comparable to similarly titled measures used by other entities.

The GAAP measure most directly comparable to distributable cash flow and adjusted free cash flow is net cash provided by (used in) operating activities. Distributable cash flow and adjusted free cash flow should not be considered alternatives to, or more meaningful than, net income (loss), operating income (loss), Net cash provided by (used in) operating activities, or any other measure of liquidity presented in accordance with GAAP. Distributable cash flow and adjusted free cash flow have important limitations because they exclude some items that affect net income (loss), operating income (loss), and net cash provided by (used in) operating activities. Distributable cash flow and adjusted free cash flow may not be comparable to similarly titled measures of other companies because other companies may not calculate these non-GAAP metrics in the same manner. To compensate for these limitations, we believe that it is important to consider net cash provided by (used in) operating activities determined under GAAP, as well as distributable cash flow and adjusted free cash flow, to evaluate our overall liquidity.

MMLP-F

     

MARTIN MIDSTREAM PARTNERS L.P. CONSOLIDATED AND CONDENSED BALANCE SHEETS (Dollars in thousands) 

 

 

June 30, 2024

 

December 31, 2023

 

(Unaudited)

 

(Audited)

Assets

 

 

 

Cash

$

55

 

 

$

54

 

Accounts and other receivables, less allowance for doubtful accounts of $506 and $530, respectively

 

50,910

 

 

 

53,293

 

Inventories

 

41,597

 

 

 

43,822

 

Due from affiliates

 

22,151

 

 

 

7,924

 

Other current assets

 

10,284

 

 

 

9,220

 

Total current assets

 

124,997

 

 

 

114,313

 

 

 

 

 

Property, plant and equipment, at cost

 

939,570

 

 

 

918,786

 

Accumulated depreciation

 

(631,219

)

 

 

(612,993

)

Property, plant and equipment, net

 

308,351

 

 

 

305,793

 

 

 

 

 

Goodwill

 

16,671

 

 

 

16,671

 

Right-of-use assets

 

63,768

 

 

 

60,359

 

Investment in DSM Semichem LLC

 

7,938

 

 

 

—

 

Deferred income taxes, net

 

10,174

 

 

 

10,200

 

Other assets, net

 

3,179

 

 

 

2,039

 

Total assets

$

535,078

 

 

$

509,375

 

 

 

 

 

Liabilities and Partners’ Capital (Deficit)

 

 

 

Current installments of long-term debt and finance lease obligations

$

14

 

 

$

—

 

Trade and other accounts payable

 

51,874

 

 

 

51,653

 

Product exchange payables

 

—

 

 

 

426

 

Due to affiliates

 

3,269

 

 

 

6,334

 

Income taxes payable

 

1,374

 

 

 

652

 

Other accrued liabilities

 

42,178

 

 

 

41,499

 

Total current liabilities

 

98,709

 

 

 

100,564

 

 

 

 

 

Long-term debt, net

 

439,397

 

 

 

421,173

 

Finance lease obligations

 

62

 

 

 

—

 

Operating lease liabilities

 

47,187

 

 

 

45,684

 

Other long-term obligations

 

7,589

 

 

 

6,578

 

Total liabilities

 

592,944

 

 

 

573,999

 

 

 

 

 

Commitments and contingencies

 

 

 

Partners’ capital (deficit)

 

(57,866

)

 

 

(64,624

)

Total liabilities and partners' capital (deficit)

$

535,078

 

 

$

509,375

 

       

MARTIN MIDSTREAM PARTNERS L.P. CONSOLIDATED AND CONDENSED STATEMENTS OF OPERATIONS (Unaudited) (Dollars in thousands, except per unit amounts) 

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Revenues:

 

 

 

 

 

 

 

Terminalling and storage *

$

22,375

 

 

$

21,684

 

 

$

44,892

 

 

$

42,542

 

Transportation *

 

57,676

 

 

 

54,750

 

 

 

115,983

 

 

 

110,473

 

Sulfur services

 

3,477

 

 

 

3,357

 

 

 

6,954

 

 

 

6,715

 

Product sales: *

 

 

 

 

 

 

 

Specialty products

 

67,288

 

 

 

78,872

 

 

 

133,613

 

 

 

211,141

 

Sulfur services

 

33,715

 

 

 

36,973

 

 

 

63,919

 

 

 

69,294

 

 

 

101,003

 

 

 

115,845

 

 

 

197,532

 

 

 

280,435

 

Total revenues

 

184,531

 

 

 

195,636

 

 

 

365,361

 

 

 

440,165

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

Cost of products sold: (excluding depreciation and amortization)

 

 

 

 

 

 

 

Specialty products *

 

57,553

 

 

 

71,570

 

 

 

114,783

 

 

 

189,565

 

Sulfur services *

 

19,234

 

 

 

25,654

 

 

 

39,633

 

 

 

47,471

 

Terminalling and storage *

 

24

 

 

 

25

 

 

 

42

 

 

 

31

 

 

 

76,811

 

 

 

97,249

 

 

 

154,458

 

 

 

237,067

 

Expenses:

 

 

 

 

 

 

 

Operating expenses *

 

65,358

 

 

 

60,737

 

 

 

129,292

 

 

 

123,482

 

Selling, general and administrative *

 

10,701

 

 

 

8,447

 

 

 

19,614

 

 

 

19,619

 

Depreciation and amortization

 

12,687

 

 

 

12,547

 

 

 

25,336

 

 

 

25,448

 

Total costs and expenses

 

165,557

 

 

 

178,980

 

 

 

328,700

 

 

 

405,616

 

 

 

 

 

 

 

 

 

Other operating income (loss), net

 

953

 

 

 

673

 

 

 

1,161

 

 

 

285

 

Operating income

 

19,927

 

 

 

17,329

 

 

 

37,822

 

 

 

34,834

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

Interest expense, net

 

(14,377

)

 

 

(15,263

)

 

 

(28,219

)

 

 

(30,920

)

Loss on extinguishment of debt

 

—

 

 

 

—

 

 

 

—

 

 

 

(5,121

)

Other, net

 

2

 

 

 

11

 

 

 

18

 

 

 

33

 

Total other expense

 

(14,375

)

 

 

(15,252

)

 

 

(28,201

)

 

 

(36,008

)

 

 

 

 

 

 

 

 

Net income (loss) before taxes

 

5,552

 

 

 

2,077

 

 

 

9,621

 

 

 

(1,174

)

Income tax expense

 

(1,772

)

 

 

(996

)

 

 

(2,568

)

 

 

(2,831

)

Net income (loss)

 

3,780

 

 

 

1,081

 

 

 

7,053

 

 

 

(4,005

)

Less general partner's interest in net income (loss)

 

(76

)

 

 

(22

)

 

 

(141

)

 

 

80

 

Less income (loss) allocable to unvested restricted units

 

(16

)

 

 

(4

)

 

 

(28

)

 

 

12

 

Limited partners' interest in net income (loss)

$

3,688

 

 

$

1,055

 

 

$

6,884

 

 

$

(3,913

)

 

 

 

 

 

 

 

 

Net income (loss) per unit attributable to limited partners - basic and diluted

$

0.09

 

 

$

0.03

 

 

$

0.18

 

 

$

(0.10

)

Weighted average limited partner units - basic

 

38,832,222

 

 

 

38,772,266

 

 

 

38,833,039

 

 

 

38,771,037

 

Weighted average limited partner units - diluted

 

38,891,375

 

 

 

38,777,600

 

 

 

38,872,192

 

 

 

38,771,037

 

 

*Related Party Transactions Shown Below 

       

MARTIN MIDSTREAM PARTNERS L.P. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Dollars in thousands, except per unit amounts) 

 

 *Related Party Transactions Included Above 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

2024

 

2023

 

2024

 

2023

Revenues:*

 

 

 

 

 

 

 

Terminalling and storage

$

18,078

 

$

18,077

 

$

36,627

 

$

35,579

Transportation

 

8,318

 

 

7,277

 

 

16,919

 

 

12,788

Product Sales

 

123

 

 

7,497

 

 

252

 

 

8,422

Costs and expenses:*

 

 

 

 

 

 

 

Cost of products sold: (excluding depreciation and amortization)

 

 

 

 

 

 

 

Specialty products

 

8,368

 

 

7,918

 

 

14,941

 

 

17,428

Sulfur services

 

2,919

 

 

2,644

 

 

5,912

 

 

5,352

Terminalling and storage

 

24

 

 

25

 

 

42

 

 

31

Expenses:

 

 

 

 

 

 

 

Operating expenses

 

26,501

 

 

25,058

 

 

52,924

 

 

48,885

Selling, general and administrative

 

8,638

 

 

6,556

 

 

15,501

 

 

15,072

       

MARTIN MIDSTREAM PARTNERS L.P. CONSOLIDATED AND CONDENSED STATEMENTS OF CAPITAL (DEFICIT) (Unaudited) (Dollars in thousands) 

 

 

 

Partners’ Capital (Deficit)

 

 

 

Common Limited

 

General

Partner

Amount

 

 

 

 

Units

 

Amount

 

 

Total

Balances - March 31, 2024

 

39,001,086

 

$

(63,115

)

 

$

1,619

 

 

$

(61,496

)

Net income

 

—

 

 

3,704

 

 

 

76

 

 

 

3,780

 

Cash distributions

 

—

 

 

(195

)

 

 

(4

)

 

 

(199

)

Unit-based compensation

 

—

 

 

49

 

 

 

—

 

 

 

49

 

Balances - June 30, 2024

 

39,001,086

 

 

(59,557

)

 

 

1,691

 

 

 

(57,866

)

 

 

 

 

 

 

 

 

 

Balances - December 31, 2023

 

38,914,806

 

$

(66,182

)

 

$

1,558

 

 

$

(64,624

)

Net income

 

—

 

 

6,912

 

 

 

141

 

 

 

7,053

 

Issuance of restricted units

 

86,280

 

 

—

 

 

 

—

 

 

 

—

 

Cash distributions

 

—

 

 

(390

)

 

 

(8

)

 

 

(398

)

Unit-based compensation

 

—

 

 

103

 

 

 

—

 

 

 

103

 

Balances - June 30, 2024

 

39,001,086

 

$

(59,557

)

 

$

1,691

 

 

$

(57,866

)

 

 

Partners’ Capital (Deficit)

 

 

 

Common Limited

 

General

Partner

Amount

 

 

 

 

Units

 

Amount

 

 

Total

Balances - March 31, 2023

 

38,914,806

 

$

(66,236

)

 

$

1,559

 

 

$

(64,677

)

Net income

 

—

 

 

1,059

 

 

 

22

 

 

 

1,081

 

Cash distributions

 

—

 

 

(195

)

 

 

(4

)

 

 

(199

)

Unit-based compensation

 

—

 

 

38

 

 

 

—

 

 

 

38

 

Balances - June 30, 2023

 

38,914,806

 

 

(65,334

)

 

 

1,577

 

 

 

(63,757

)

 

 

 

 

 

 

 

 

 

Balances - December 31, 2022

 

38,850,750

 

$

(61,110

)

 

$

1,665

 

 

$

(59,445

)

Net loss

 

—

 

 

(3,925

)

 

 

(80

)

 

 

(4,005

)

Issuance of restricted units

 

64,056

 

 

—

 

 

 

—

 

 

 

—

 

Cash distributions

 

—

 

 

(389

)

 

 

(8

)

 

 

(397

)

Unit-based compensation

 

—

 

 

90

 

 

 

—

 

 

 

90

 

Balances - June 30, 2023

 

38,914,806

 

$

(65,334

)

 

$

1,577

 

 

$

(63,757

)

       

MARTIN MIDSTREAM PARTNERS L.P. CONSOLIDATED AND CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (Dollars in thousands) 

 

 

Six Months Ended

 

June 30,

 

 

2024

 

 

 

2023

 

Cash flows from operating activities:

 

 

 

Net income (loss)

$

7,053

 

 

$

(4,005

)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

25,336

 

 

 

25,448

 

Amortization of deferred debt issuance costs

 

1,539

 

 

 

2,435

 

Amortization of debt discount

 

1,200

 

 

 

1,000

 

Deferred income tax expense

 

26

 

 

 

1,867

 

Gain on disposition or sale of property, plant and equipment, net

 

(1,161

)

 

 

(285

)

Loss on extinguishment of debt

 

—

 

 

 

5,121

 

Non cash unit-based compensation

 

103

 

 

 

90

 

Change in current assets and liabilities, excluding effects of acquisitions and dispositions:

 

 

 

Accounts and other receivables

 

2,383

 

 

 

22,619

 

Inventories

 

2,031

 

 

 

58,933

 

Due from affiliates

 

(14,227

)

 

 

5,654

 

Other current assets

 

174

 

 

 

5,296

 

Trade and other accounts payable

 

523

 

 

 

(19,459

)

Product exchange payables

 

(426

)

 

 

278

 

Due to affiliates

 

(3,065

)

 

 

(6,641

)

Income taxes payable

 

722

 

 

 

(215

)

Other accrued liabilities

 

(1,196

)

 

 

1,907

 

Change in other non-current assets and liabilities

 

922

 

 

 

(1,269

)

Net cash provided by operating activities

 

21,937

 

 

 

98,774

 

 

 

 

 

Cash flows from investing activities:

 

 

 

Payments for property, plant and equipment

 

(24,194

)

 

 

(17,024

)

Payments for plant turnaround costs

 

(6,705

)

 

 

(661

)

Investment in DSM Semichem LLC

 

(6,938

)

 

 

—

 

Proceeds from sale of property, plant and equipment

 

738

 

 

 

4,275

 

Net cash used in investing activities

 

(37,099

)

 

 

(13,410

)

 

 

 

 

Cash flows from financing activities:

 

 

 

Payments of long-term debt

 

(113,000

)

 

 

(519,197

)

Payments under finance lease obligations

 

(1

)

 

 

(9

)

Proceeds from long-term debt

 

128,577

 

 

 

448,489

 

Payment of debt issuance costs

 

(15

)

 

 

(14,238

)

Cash distributions paid

 

(398

)

 

 

(397

)

Net cash provided by (used in) financing activities

 

15,163

 

 

 

(85,352

)

 

 

 

 

Net increase in cash

 

1

 

 

 

12

 

Cash at beginning of period

 

54

 

 

 

45

 

Cash at end of period

$

55

 

 

$

57

 

 

 

 

 

Non-cash additions to property, plant and equipment

$

2,641

 

 

$

1,679

 

Non-cash contribution of land to DSM Semichem LLC

$

1,000

 

 

$

—

 

       

MARTIN MIDSTREAM PARTNERS L.P. SEGMENT OPERATING INCOME (Unaudited) (Dollars and volumes in thousands, except BBL per day) 

 

Terminalling and Storage Segment 

 

Comparative Results of Operations for the Three Months Ended June 30, 2024 and 2023 

 

 

Three Months Ended June 30,

 

Variance

 

Percent Change

 

2024

 

2023

 

 

 

(In thousands, except BBL per day)

 

 

 

 

 

 

 

 

 

 

Revenues

$

24,402

 

$

23,906

 

$

496

 

 

2

%

Cost of products sold

 

24

 

 

25

 

 

(1

)

 

(4

)%

Operating expenses

 

15,522

 

 

13,932

 

 

1,590

 

 

11

%

Selling, general and administrative expenses

 

820

 

 

333

 

 

487

 

 

146

%

Depreciation and amortization

 

5,729

 

 

5,195

 

 

534

 

 

10

%

 

 

2,307

 

 

4,421

 

 

(2,114

)

 

(48

)%

Other operating income, net

 

995

 

 

25

 

 

970

 

 

3,880

%

Operating income

$

3,302

 

$

4,446

 

$

(1,144

)

 

(26

)%

 

 

 

 

 

 

 

 

Shore-based throughput volumes (gallons)

 

42,491

 

 

42,434

 

 

57

 

 

—

%

Smackover refinery throughput volumes (guaranteed minimum BBL per day)

 

6,500

 

 

6,500

 

 

—

 

 

—

%

 

Comparative Results of Operations for the Six Months Ended June 30, 2024 and 2023 

 

 

Six Months Ended June 30,

 

Variance

 

Percent Change

 

2024

 

 

2023

 

 

 

 

(In thousands, except BBL per day)

 

 

 

 

 

 

 

 

 

 

Revenues

$

48,687

 

$

47,825

 

 

$

862

 

 

2

%

Cost of products sold

 

42

 

 

31

 

 

 

11

 

 

35

%

Operating expenses

 

30,557

 

 

28,240

 

 

 

2,317

 

 

8

%

Selling, general and administrative expenses

 

1,102

 

 

882

 

 

 

220

 

 

25

%

Depreciation and amortization

 

11,124

 

 

10,794

 

 

 

330

 

 

3

%

 

 

5,862

 

 

7,878

 

 

 

(2,016

)

 

(26

)%

Other operating income (loss), net

 

1,097

 

 

(324

)

 

 

1,421

 

 

439

%

Operating income

$

6,959

 

$

7,554

 

 

$

(595

)

 

(8

)%

 

 

 

 

 

 

 

 

Shore-based throughput volumes (gallons)

 

88,260

 

 

85,783

 

 

 

2,477

 

 

3

%

Smackover refinery throughput volumes (guaranteed minimum) (BBL per day)

 

6,500

 

 

6,500

 

 

 

—

 

 

—

%

   

Transportation Segment 

 

Comparative Results of Operations for the Three Months Ended June 30, 2024 and 2023 

 

 

Three Months Ended June 30,

 

Variance

 

Percent Change

 

2024

 

2023

 

 

 

(In thousands)

 

 

Revenues

$

61,467

 

$

58,395

 

$

3,072

 

 

5

%

Operating expenses

 

47,783

 

 

44,285

 

 

3,498

 

 

8

%

Selling, general and administrative expenses

 

2,527

 

 

1,981

 

 

546

 

 

28

%

Depreciation and amortization

 

3,381

 

 

3,760

 

 

(379

)

 

(10

)%

 

 

7,776

 

 

8,369

 

 

(593

)

 

(7

)%

Other operating income, net

 

260

 

 

647

 

 

(387

)

 

(60

)%

Operating income

$

8,036

 

$

9,016

 

$

(980

)

 

(11

)%

 

Comparative Results of Operations for the Six Months Ended June 30, 2024 and 2023 

 

 

Six Months Ended June 30,

 

Variance

 

Percent Change

 

2024

 

2023

 

 

 

(In thousands)

 

 

Revenues

$

123,509

 

$

120,334

 

$

3,175

 

 

3

%

Operating expenses

 

94,424

 

 

90,475

 

 

3,949

 

 

4

%

Selling, general and administrative expenses

 

4,727

 

 

4,530

 

 

197

 

 

4

%

Depreciation and amortization

 

6,857

 

 

7,522

 

 

(665

)

 

(9

)%

 

$

17,501

 

$

17,807

 

$

(306

)

 

(2

)%

Other operating income, net

 

366

 

 

651

 

 

(285

)

 

(44

)%

Operating income

$

17,867

 

$

18,458

 

$

(591

)

 

(3

)%

   

Sulfur Services Segment 

 

Comparative Results of Operations for the Three Months Ended June 30, 2024 and 2023 

 

 

Three Months Ended June 30,

 

Variance

 

Percent Change

 

 

2024

 

 

2023

 

 

 

(In thousands)

 

 

Revenues:

 

 

 

 

 

 

 

Services

$

3,477

 

 

$

3,357

 

$

120

 

 

4

%

Products

 

33,716

 

 

 

36,973

 

 

(3,257

)

 

(9

)%

Total revenues

 

37,193

 

 

 

40,330

 

 

(3,137

)

 

(8

)%

 

 

 

 

 

 

 

 

Cost of products sold

 

22,183

 

 

 

28,141

 

 

(5,958

)

 

(21

)%

Operating expenses

 

2,744

 

 

 

3,186

 

 

(442

)

 

(14

)%

Selling, general and administrative expenses

 

1,717

 

 

 

962

 

 

755

 

 

78

%

Depreciation and amortization

 

2,778

 

 

 

2,756

 

 

22

 

 

1

%

 

 

7,771

 

 

 

5,285

 

 

2,486

 

 

47

%

Other operating income (loss), net

 

(308

)

 

 

1

 

 

(309

)

 

(30,900

)%

Operating income

$

7,463

 

 

$

5,286

 

$

2,177

 

 

41

%

 

 

 

 

 

 

 

 

Sulfur (long tons)

 

91

 

 

 

123

 

 

(32

)

 

(26

)%

Fertilizer (long tons)

 

64

 

 

 

73

 

 

(9

)

 

(12

)%

Total sulfur services volumes (long tons)

 

155

 

 

 

196

 

 

(41

)

 

(21

)%

 

Comparative Results of Operations for the Six Months Ended June 30, 2024 and 2023 

 

 

Six Months Ended June 30,

 

Variance

 

Percent Change

 

 

2024

 

 

2023

 

 

 

(In thousands)

 

 

Revenues:

 

 

 

 

 

 

 

Services

$

6,954

 

 

$

6,715

 

$

239

 

 

4

%

Products

 

63,920

 

 

 

69,294

 

 

(5,374

)

 

(8

)%

Total revenues

 

70,874

 

 

 

76,009

 

 

(5,135

)

 

(7

)%

 

 

 

 

 

 

 

 

Cost of products sold

 

44,954

 

 

 

52,090

 

 

(7,136

)

 

(14

)%

Operating expenses

 

5,684

 

 

 

6,085

 

 

(401

)

 

(7

)%

Selling, general and administrative expenses

 

3,020

 

 

 

2,579

 

 

441

 

 

17

%

Depreciation and amortization

 

5,760

 

 

 

5,433

 

 

327

 

 

6

%

 

 

11,456

 

 

 

9,822

 

 

1,634

 

 

17

%

Other operating income (loss), net

 

(308

)

 

 

17

 

 

(325

)

 

(1,912

)%

Operating income

$

11,148

 

 

$

9,839

 

$

1,309

 

 

13

%

 

 

 

 

 

 

 

 

Sulfur (long tons)

 

182

 

 

 

197

 

 

(15

)

 

(8

)%

Fertilizer (long tons)

 

136

 

 

 

134

 

 

2

 

 

1

%

Total sulfur services volumes (long tons)

 

318

 

 

 

331

 

 

(13

)

 

(4

)%

   

Specialty Products Segment 

 

Comparative Results of Operations for the Three Months Ended June 30, 2024 and 2023 

 

 

Three Months Ended June 30,

 

Variance

 

Percent Change

 

2024

 

2023

 

 

 

(In thousands)

 

 

Products revenues

$

67,317

 

$

78,898

 

$

(11,581

)

 

(15

)%

Cost of products sold

 

59,711

 

 

74,270

 

 

(14,559

)

 

(20

)%

Operating expenses

 

26

 

 

18

 

 

8

 

 

44

%

Selling, general and administrative expenses

 

1,842

 

 

1,299

 

 

543

 

 

42

%

Depreciation and amortization

 

799

 

 

836

 

 

(37

)

 

(4

)%

 

 

4,939

 

 

2,475

 

 

2,464

 

 

100

%

Other operating income, net

 

6

 

 

—

 

 

6

 

 

 

Operating income

$

4,945

 

$

2,475

 

$

2,470

 

 

100

%

 

 

 

 

 

 

 

 

NGL sales volumes (Bbls)

 

540

 

 

827

 

 

(287

)

 

(35

)%

Other specialty products volumes (Bbls)

 

93

 

 

90

 

 

3

 

 

3

%

Total specialty products volumes (Bbls)

 

633

 

 

917

 

 

(284

)

 

(31

)%

 

Comparative Results of Operations for the Six Months Ended June 30, 2024 and 2023 

 

 

Six Months Ended June 30,

 

Variance

 

Percent Change

 

2024

 

 

2023

 

 

 

 

(In thousands)

 

 

Products revenues

$

133,663

 

$

211,175

 

 

$

(77,512

)

 

(37

)%

Cost of products sold

 

119,355

 

 

198,721

 

 

 

(79,366

)

 

(40

)%

Operating expenses

 

51

 

 

32

 

 

 

19

 

 

59

%

Selling, general and administrative expenses

 

3,165

 

 

3,589

 

 

 

(424

)

 

(12

)%

Depreciation and amortization

 

1,595

 

 

1,699

 

 

 

(104

)

 

(6

)%

 

 

9,497

 

 

7,134

 

 

 

2,363

 

 

33

%

Other operating income (loss), net

 

6

 

 

(59

)

 

 

65

 

 

110

%

Operating income

$

9,503

 

$

7,075

 

 

$

2,428

 

 

34

%

 

 

 

 

 

 

 

 

NGL sales volumes (Bbls)

 

1,162

 

 

2,518

 

 

 

(1,356

)

 

(54

)%

Other specialty products volumes (Bbls)

 

172

 

 

174

 

 

 

(2

)

 

(1

)%

Total specialty products volumes (Bbls)

 

1,334

 

 

2,692

 

 

 

(1,358

)

 

(50

)%

   

Unallocated Selling, General and Administrative Expenses 

 

Comparative Results of Operations for the Three and Six Months Ended June 30, 2024 and 2023 

 

 

Three Months Ended

June 30,

 

Variance

 

Percent

Change

 

Six Months Ended

June 30,

 

Variance

 

Percent

Change

 

2024

 

2023

 

 

 

2024

 

2023

 

 

 

(In thousands)

 

 

 

(In thousands)

 

 

Indirect selling, general and administrative expenses

$

3,819

 

$

3,894

 

$

(75

)

 

(2

)%

 

$

7,655

 

$

8,092

 

$

(437

)

 

(5

)%

       

Non-GAAP Financial Measures 

 

The following tables reconcile the non-GAAP financial measurements used by management to our most directly comparable GAAP measures for the three and six months ended June 30, 2024 and 2023, which represents EBITDA, adjusted EBITDA, adjusted EBITDA after giving effect to the exit of the butane optimization business, distributable cash flow, and adjusted free cash flow:

 

Reconciliation of Net Income (Loss) to EBITDA, Adjusted EBITDA, and Adjusted EBITDA After Giving Effect to the Exit of the Butane Optimization Business 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

 

(in thousands)

 

(in thousands)

Net income (loss)

$

3,780

 

 

$

1,081

 

 

$

7,053

 

 

$

(4,005

)

Adjustments:

 

 

 

 

 

 

 

Interest expense

 

14,377

 

 

 

15,263

 

 

 

28,219

 

 

 

30,920

 

Income tax expense

 

1,772

 

 

 

996

 

 

 

2,568

 

 

 

2,831

 

Depreciation and amortization

 

12,687

 

 

 

12,547

 

 

 

25,336

 

 

 

25,448

 

EBITDA

 

32,616

 

 

 

29,887

 

 

 

63,176

 

 

 

55,194

 

Adjustments:

 

 

 

 

 

 

 

Gain on disposition or sale of property, plant and equipment

 

(953

)

 

 

(673

)

 

 

(1,161

)

 

 

(285

)

Loss on extinguishment of debt

 

—

 

 

 

—

 

 

 

—

 

 

 

5,121

 

Lower of cost or net realizable value and other non-cash adjustments

 

—

 

 

 

(3,717

)

 

 

—

 

 

 

(12,850

)

Unit-based compensation

 

49

 

 

 

38

 

 

 

103

 

 

 

90

 

Adjusted EBITDA

$

31,712

 

 

$

25,535

 

 

$

62,118

 

 

$

47,270

 

Adjustments:

 

 

 

 

 

 

 

Less: net loss associated with butane optimization business

 

—

 

 

 

2,564

 

 

 

—

 

 

 

2,255

 

Plus: lower of cost or net realizable value and other non-cash adjustments

 

—

 

 

$

3,717

 

 

 

—

 

 

 

12,850

 

Adjusted EBITDA after giving effect to the exit of the butane optimization business

$

31,712

 

 

$

31,816

 

 

$

62,118

 

 

$

62,375

 

     

Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA, Adjusted EBITDA After Giving Effect to the Exit of the Butane Optimization Business, Distributable Cash Flow, and Adjusted Free Cash Flow 

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

 

(in thousands)

 

(in thousands)

Net cash provided by operating activities

$

11,828

 

 

$

49,510

 

 

$

21,937

 

 

$

98,774

 

Interest expense 1

 

13,004

 

 

 

13,903

 

 

 

25,480

 

 

 

27,485

 

Current income tax expense

 

1,420

 

 

 

306

 

 

 

2,542

 

 

 

964

 

Lower of cost or net realizable value and other non-cash adjustments

 

—

 

 

 

(3,717

)

 

 

—

 

 

 

(12,850

)

Changes in operating assets and liabilities which (provided) used cash:

 

 

 

 

 

 

 

Accounts and other receivables, inventories, and other current assets

 

9,919

 

 

 

(43,135

)

 

 

9,639

 

 

 

(91,517

)

Trade, accounts and other payables, and other current liabilities

 

(3,786

)

 

 

7,171

 

 

 

3,442

 

 

 

23,145

 

Other

 

(673

)

 

 

1,497

 

 

 

(922

)

 

 

1,269

 

Adjusted EBITDA

 

31,712

 

 

 

25,535

 

 

 

62,118

 

 

 

47,270

 

Adjustments:

 

 

 

 

 

 

 

Less: net loss associated with butane optimization business

 

—

 

 

 

2,564

 

 

 

—

 

 

 

2,255

 

Plus: lower of cost or net realizable value and other non-cash adjustments

 

—

 

 

 

3,717

 

 

 

—

 

 

 

12,850

 

Adjusted EBITDA after giving effect to the exit of the butane optimization business

 

31,712

 

 

 

31,816

 

 

 

62,118

 

 

 

62,375

 

Adjustments:

 

 

 

 

 

 

 

Interest expense

 

(14,377

)

 

 

(15,263

)

 

 

(28,219

)

 

 

(30,920

)

Income tax expense

 

(1,772

)

 

 

(996

)

 

 

(2,568

)

 

 

(2,831

)

Deferred income taxes

 

352

 

 

 

690

 

 

 

26

 

 

 

1,867

 

Amortization of debt discount

 

600

 

 

 

600

 

 

 

1,200

 

 

 

1,000

 

Amortization of deferred debt issuance costs

 

773

 

 

 

760

 

 

 

1,539

 

 

 

2,435

 

Payments for plant turnaround costs

 

(745

)

 

 

(432

)

 

 

(6,705

)

 

 

(661

)

Maintenance capital expenditures

 

(7,009

)

 

 

(7,438

)

 

 

(12,211

)

 

 

(14,072

)

Distributable cash flow

 

9,534

 

 

 

9,737

 

 

 

15,180

 

 

 

19,193

 

Principal payments under finance lease obligations

 

(1

)

 

 

(3

)

 

 

(1

)

 

 

(9

)

Investment in DSM Semichem LLC

 

(6,938

)

 

 

—

 

 

 

(6,938

)

 

 

—

 

Expansion capital expenditures

 

(5,450

)

 

 

(1,925

)

 

 

(11,681

)

 

 

(2,682

)

Adjusted free cash flow

$

(2,855

)

 

$

7,809

 

 

$

(3,440

)

 

$

16,502

 

 

1 Net of amortization of debt issuance costs and discount, which are included in interest expense but not included in net cash provided by (used in) operating activities. 

   

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240717514885/en/

Sharon Taylor - Executive Vice President & Chief Financial Officer (877) 256-6644 investor.relations@mmlp.com