T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
A N A L Y S T &
I N V E S T O R D A Y
M A R C H 2 3
2017
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
3
MARTIN MIDSTREAM PARTNERS L.P. ANALYST & INVESTOR DAY 2017
A G E N D A
Welcome & MMLP
Overview
Operational
Overview
Financial
Foundation
Question
& Answer
Closing Remarks
Bob Bondurant, Executive Vice President & Chief Financial Officer
Joe McCreery, Vice President – Finance & Head of Investor Relations
Panel & Audience
Ruben Martin, President & Chief Executive Officer
Joe McCreery, Vice President – Finance & Head of Investor Relations
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
4
MARTIN MIDSTREAM PARTNERS L.P. ANALYST & INVESTOR DAY 2017
U S E O F N O N - G A A P F I N A N C I A L M E A S U R E S
This presentation includes certain non-GAAP financial measures such as EBITDA and Adjusted EBITDA. These non-GAAP financial
measures are not meant to be considered in isolation or as a substitute for results prepared in accordance with accounting principles
generally accepted in the United States (GAAP). A reconciliation of non-GAAP financial measures included in this presentation to the
most directly comparable financial measures calculated and presented in accordance with GAAP is set forth in the Appendix of this
presentation or on our web site at www.martinmidstream.com.
MMLP’s management believes that these non-GAAP financial measures may provide useful information to investors regarding MMLP’s
financial condition and results of operations as they provide another measure of the profitability and ability to service its debt and are
considered important measures by financial analysts covering MMLP and its peers.
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
5
MARTIN MIDSTREAM PARTNERS L.P. ANALYST & INVESTOR DAY 2017
F O R WA R D L O O K I N G S TAT E M E N T S
Statements included that are not historical facts (including any statements concerning plans and objectives of management for future
operations or economic performance or assumptions or forecasts related thereto), are forward-looking statements. These statements
can be identified by the use of forward-looking terminology including “forecast,” “may,” “believe,” “will,” “expect,” “anticipate,”
“estimate,” “continue,” or other similar words. These statements discuss future expectations, contain projections of results of
operations or of financial condition or state other “forward-looking” information. We and our representatives may from time to time
make other oral or written statements that are also forward-looking statements.
These forward-looking statements are based upon management’s current plans, expectations, estimates, assumptions and beliefs
concerning future events impacting us and therefore involve a number of risks and uncertainties. We caution that forward-looking
statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking
statements.
Because these forward-looking statements involve risks and uncertainties, actual results could differ materially from those expressed or
implied by these forward-looking statements for a number of important reasons. A discussion of these factors, including risks and
uncertainties, is set forth in Martin Midstream Partners L.P.’s annual and quarterly reports filed from time to time with the Securities
and Exchange Commission. Martin Midstream Partners L.P. expressly disclaims any intention or obligation to revise or update any
forward-looking statements whether as a result of new information, future events, or otherwise.
W E L C O M E & M M L P O V E RV I E W
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
7
• NASDAQ Listed: MMLP
• Formed October 31, 2002
• MMLP is a publicly traded, diversified master limited partnership
with operations including:
• Terminalling & Storage
• Natural Gas Services
• Sulfur Services
• Marine Transportation
• MMLP Trading Summary (1)
• Unit Price: $19.20
• Units Outstanding 38.5 million
• Market Cap: $738 million
• Quarterly Distribution: $0.50/$2.00 annualized
• Current Yield: 10.4%
(1) As of March 21, 2017 close
MARTIN MIDSTREAM PARTNERS L.P. OVERVIEW
( M M L P ) O V E R V I E W
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
8
• Majority (nearly 70%) of cash flows generated from fee-based contracts which include take or pay,
reservation and minimum volume commitments
• Diversified asset base with four complementary business units that create an integrated distribution
network with the ability to handle and transport specialty products
• Strategically located assets in areas of concentrated customer activity; primarily U.S. Gulf Coast –
“Refinery Belt”
• 12 public equity offerings since IPO for approximately $925 million in net proceeds(1)
• High-quality base of industry leading customers including major oil and gas companies,
independent refiners, large chemical companies and fertilizer manufacturers
(1) Includes GP Contribution and net ATM issuance proceeds
Fee-Based Contracts
Fully Integrated,
Diversified Service
Provider
Attractive Operating
Footprint
Proven Access
To Capital
Stable, Diversified
Customer Base
MARTIN MIDSTREAM PARTNERS L.P.
K E Y I N V E S T M E N T H I G H L I G H T S
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
9
($191.4 million before $14.8 million unallocated SG&A
and other non-operating income)
Natural Gas Services
$78.7
Sulfur Services
$35.1
Marine Transportation
$8.1
Terminalling & Storage
$69.5
$176.6 million Adjusted EBITDA
MARTIN MIDSTREAM PARTNERS L.P.
U N I Q U E LY D I V E R S I F I E D O P E R AT I N G M I X
$ millions
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
10
MARTIN MIDSTREAM PARTNERS L.P. OVERVIEW
M M L P A S S E T L O C AT I O N S – A L L S E G M E N T S
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
11
*Adjusted for divestiture of Corpus Christi
terminal assets fee/margin split would be
68%/32%
MARTIN MIDSTREAM PARTNERS L.P.
S T R O N G F E E B A S E D C O N T R A C T M I X
Natural Gas Services
• Fee-based, multi-year natural gas storage contracts (weighted average
life approximately 4 years as of December 31, 2016)
• Fee-based, regulated common carrier tariffs (WTLPG)
• Margin-based, wholesale NGLs
Terminalling & Storage
• Fee-based, multi-year contracts for traditional storage assets – Specialty and Shore Base
Terminals (with minimum volume commitments)
• Fee-based, long-term tolling agreement for Smackover Refinery (with guaranteed
minimum volume)
• Margin-based, lubricants contracts/revenue
Sulfur Services
• Fee-based, multi-year “take-or-pay” contracts for prilling assets
• Fee-based, molten sulfur transportation and handling contract
• Margin-based, fertilizer contracts/revenue
Marine Transportation
• Fee-based, day-rate contracts
Note: “Margin-based” contracts typically represent buy/sell contracts that are priced off of the same benchmark
simultaneously
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
12
MARTIN MIDSTREAM PARTNERS L.P.
H I G H Q U A L I T Y L O N G - T E R M C U S TO M E R B A S E
• Long-term customer relationships are a key driver of our success
• Full value chain solutions for handling and logistics
• Customers include some of the largest, most recognizable
businesses in the energy industry. These include major oil and
gas companies, independent refiners, large chemical companies,
and fertilizer manufacturers
• Top customers by revenue shown to the right
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
13
MARTIN RESOURCE MANAGEMENT CORPORATION OVERVIEW
( M R M C ) O V E R V I E W
• Based in Kilgore, TX, since 1951, MRMC is a leading independent provider of storage, manufacturing, marketing, and distribution
services to energy, petrochemical and other industrial concerns
• Approximately 1,900 employees
• In 2016, MRMC operating entities generated revenue in excess of $1.1 billion(1)
• Fully employee-owned through ESOP as of December 2013
• IRS approved S-Corp 1/1/2014
• Owns 51% voting interest in the general partner of MMLP
• 6.3 million units (16.3% limited partnership unit ownership)
• Key MRMC Operating Subsidiaries
• Martin Energy Services LLC
• Martin Transport, Inc.
• Cross Oil Refining & Marketing, Inc.
• Martin Product Sales LLC
• As a major counterparty of MMLP, MRMC’s financial stability is vitally important to the Partnership. MRMC has and continues to
enhance its credit profile. Forecasted senior secured leverage for FYE2017 is 3.1x, and liquidity remains strong.
(1) MRMC revenue reflects pre-audited results
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
14
MARTIN MIDSTREAM PARTNERS L.P.
S T R O N G G E N E R A L PA R T N E R S U P P O R T
• MRMC’s operations support MMLP’s cash flow
• MRMC’s distinct assets and business units are
complementary to MMLP
• MRMC’s contractual relationships with MMLP are
designed to move commodity pricing volatility
away from MMLP leaving behind stable, fee-
based cash flow
• Approximately 25% of 2016 MMLP Adjusted
EBITDA derived from contracts with MRMC
• MRMC has significantly assisted in MMLP’s growth and is
committed to the Partnership
• MRMC has provided over $400 million in asset
drop-downs since IPO
• MRMC owns 16.3% of outstanding LP units
• Alinda Capital Partners (“Alinda”) has a 49% voting/50%
economic interest in the general partner of MMLP
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
15
Natural Gas Services
$76.9
Sulfur Services
$29.8
Marine Transportation
$7.2
Terminalling & Storage
$59.1
MARTIN MIDSTREAM PARTNERS L.P.
2 0 1 7 E G U I D A N C E B Y S E G M E N T
2017
($173.0 million before $15.6 million unallocated SG&A
and other non-operating income)
$157.4 million Adjusted EBITDA
$ millions
Maintenance Capital expenditures (incl. tunaround expenses)
projected to be $20 to $25 million
16
O P E R AT I O N A L O V E RV I E W
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
17
MARTIN MIDSTREAM PARTNERS L.P.
N AT U R A L G A S S E R V I C E S O V E R V I E W
• Cardinal Gas Storage operates approximately 50 billion cubic feet of natural gas storage capacity across four facilities throughout
northern Louisiana and Mississippi.
• MMLP distributes NGLs purchased primarily from refineries and natural gas processors. MMLP stores and transports NGLs for
wholesale delivery to propane retailers, refineries and industrial NGL users in Texas and the Southeastern U.S. MMLP owns a
NGL pipeline, which spans approximately 200 miles from Kilgore, TX to Beaumont, TX and owns approximately 2.4 million barrels
of underground storage capacity for NGLs.
• MMLP owns a combined 20% non-operating interest in WTLPG. WTLPG owns an approximate 2,300 mile common carrier
pipeline system that transports NGLs from New Mexico and Texas to Mont Belvieu, TX for fractionation.
Key Assets
2016
Adj. EBITDA
2017E
Adj. EBITDA
Cardinal $42.0 $36.3
Butane $23.5 $26.1
WTLPG $7.5 $8.8
NGLs $1.2 $2.5
Propane $4.5 $3.2
Total NGS $78.7 $76.9
$ millions
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
18
• Firm contracted model for natural gas storage with
interruptible service upside
• Long term contracts – Cardinal’s weighted average contract
life of approximately 4 years protects against significant cash
flow deterioration in the near term
• Potential storage demand drivers:
• LNG exports
• Natural gas exports to Mexico
• Increasing industrial and petrochemical use
• Coal-fired power conversions to natural gas
• Increased volatility – Due to demand drivers above, natural
gas price volatility should enhance the value of storage assets
Type
Working Gas
Capacity (bcf)
Currently
Contracted Years
Arcadia Salt Cavern 16.3 89% 2.6
Cadeville
Depleted
Reservoir
17.0 100% 6.4
Perryville Salt Cavern 9.0 94% 2.0
Monroe
Depleted
Reservoir
7.4 89% 3.3
Total 49.7 94%
Source 10K, December 31, 2016
Firm Contracted/Fee-Based Storage Model Cardinal Contract Summary
MARTIN MIDSTREAM PARTNERS L.P. – NATURAL GAS SERVICES
C A R D I N A L G A S S TO R A G E
$44.3
$42.0
$36.3
$20.0
$25.0
$30.0
$35.0
$40.0
$45.0
$50.0
2015 2016 2017E
Cardinal Gas Storage Adjusted EBITDA
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
19
Arcadia Gas Storage
• Salt dome facility (Arcadia, LA) – 16.3 bcf
Perryville Gas Storage
• Salt dome facility (Delhi, LA) – 9.0 bcf
Cadeville Gas Storage
• Depleted reservoir facility (Monroe, LA) – 17.0 bcf
Monroe Gas Storage
• Depleted reservoir facility (Amory, MS) – 7.4 bcf
MARTIN MIDSTREAM PARTNERS L.P. – NATURAL GAS SERVICES
C A R D I N A L G A S S TO R A G E A S S E T L O C AT I O N S
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
20
• Refineries adjust the vapor pressure of gasoline to
meet seasonal EPA standards and are allowed to blend
butane into gasoline pool during winter months
• MMLP owns and leases a network of underground
storage facilities in Louisiana. At the owned Arcadia,
LA facility, MMLP has rail and truck transloading
capabilities.
MARTIN MIDSTREAM PARTNERS L.P. – NATURAL GAS SERVICES
B U TA N E O P T I M I Z AT I O N
Butane Optimization
$19.9
$23.5
$26.1
$-
$5.0
$10.0
$15.0
$20.0
$25.0
$30.0
2015 2016 2017E
Butanes Adjusted EBITDA
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
21
• The WTLPG system is approximately 2,300 miles of Y-grade pipeline from Eastern New Mexico to Mt. Belvieu, TX
• MMLP owns 20% interests in WTLPG. (OKS is owner/operator of remaining 80%)
• Nameplate capacity of approximately 240 MBbls/day; 2016 volumes were approximately 194MBbls/day
• Connection to Cajun Sibon pipeline provides delivery alternative to Mt. Belvieu, TX
• WTLPG is connected to MAPL system for further NGL supply from the Rockies region
• Moves west to east/southeast across multiple producing regions
• Permian Basin
• Barnett Shale
• East Texas/Cotton Valley
• Opportunistically looking at access to Delaware Basin
• Texas Railroad Commission tariff dispute hearing scheduled for
week of March 27, 2017
MARTIN MIDSTREAM PARTNERS L.P. – NATURAL GAS SERVICES
W E S T T E X A S L P G P I P E L I N E L . P. ( W T L P G )
System Map
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
22
• Assets include 200-mile East Texas Pipeline transporting Y-
grade from Kilgore, TX to Beaumont, TX for fractionation; East
Texas market volumes gathered by truck for pipeline injection
• Spindeltop terminal supplies natural gasoline to Beaumont
area customers
• Wholesale propane distribution to approximately 100
regional customers throughout the Southeastern U.S.
• Propane volumes have declined over the past several
decades as distributors are consolidated and alternative
heat sources are utilized
• Martin LP provides retail propane distribution in the East
Texas market
MARTIN MIDSTREAM PARTNERS L.P. – NATURAL GAS SERVICES
N G L s & P R O PA N E
Propane NGL
$4.1
$1.2
$2.5
$-
$1.5
$3.0
$4.5
$6.0
2015 2016 2017E
NGLs Adjusted EBITDA
$4.0
$4.5
$3.2
$-
$1.5
$3.0
$4.5
$6.0
2015 2016 2017E
Propane Adjusted EBITDA
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
23
MARTIN MIDSTREAM PARTNERS L.P.
T E R M I N A L L I N G & S TO R A G E O V E R V I E W
• MMLP operates 40 terminal facilities with an aggregate storage capacity of 3.7 million barrels
• These facilities provide storage, refining, blending, packaging and handling services of petroleum products and by-products and
petrochemicals through:
• 26 marine shore-based terminals across the U.S. Gulf Coast
• 14 specialty terminals throughout the U.S. Gulf Coast and other regions
• The location and composition of these terminals are structured to complement MMLP’s other businesses
T&S
Segment
2016
Adj. EBITDA
2017E
Adj. EBITDA
Shore-Based
Terminals
$18.4 $15.7
Martin Lubricants $8.7 $9.4
Smackover Refinery $20.4 $20.7
Specialty Terminals
– Other
$10.4 $13.3
Specialty Terminals
– CCCT(1)
$11.6 $0.0
Total T&S $69.5 $59.1
$ millions
(1) Divestiture of Corpus Christi terminalling assets closed December 21, 2016
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
24
Port of Tampa Terminal, Tampa, FL
MARTIN MIDSTREAM PARTNERS L.P. – TERMINALLING & STORAGE
S P E C I A LT Y T E R M I N A L S
Specialty Terminals Overview
• Network of 14 terminals which facilitate the movement of
petroleum products and by-products and petrochemicals
from oil refiners and natural gas processing facilities
• Specialized capabilities include the ability to store and handle
products with a wide range of temperature requirements
(-30° to +400°F) and receive products transported by vessel,
barge, rail or truck
• Products handled include:
• Anhydrous ammonia (temp requirement: -30°F)
• Asphalt (temp requirement: up to 400°F)
• Crude oil
• Fuel oil
• Molten Sulfur (temp requirement: 270°F)
• Sulfuric acid
• Other assorted petroleum products and by-products
(1) 2015 and 2016 exclude Adjusted EBITDA from Corpus Christi terminalling
assets sold on December 21, 2016 of $17.1 million and $11.6 million,
respectively
$6.8
$10.4
$13.3
$-
$3.0
$6.0
$9.0
$12.0
$15.0
2015 2016 2017E
Specialty Terminals Adjusted EBITDA (1)
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
25
MARTIN MIDSTREAM PARTNERS L.P. – TERMINALLING & STORAGE
S P E C I A LT Y T E R M I N A L S
Expertise In “Hard to Handle” Product and By-Product Logistics
• Beaumont Neches
• Multi-service terminal
• Sulfur offtake and gathering point for Texas and Louisiana
refiners
• Deep water and barge dock access
• Serviced by 3 rail lines (BNSF, KCS, UP)
• Dry bulk shiploader – 20,000 tons/day
• Additional 96 acres available for expansion
• Beaumont Spindletop
• Natural gasoline terminal providing feedstock to
petrochemical manufacturer
• Beaumont Stanolind
• Multi-product handling facility
• Hondo Asphalt Terminal
• Acquired February 2017
• Partially in service now (in-bound storage
capability) with substantial completion expected in
mid year 2017 (blending and outbound loading
capabilities)
• South Houston and Omaha Asphalt
• Asphalt terminalling and processing facilities
Backed with minimum throughput guarantee (with
MRMC)
• Dunphy
• Elko, NV sulfuric acid terminal serving the mining
industry
• Minimum throughput guarantee (with MRMC)
• Tampa
• Asphalt and fuel oil terminalling capabilities
• Minimum throughput guarantees (with MRMC and
multiple other counterparties)
Specialized Sites (continued) Specialized Sites
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
26
MARTIN MIDSTREAM PARTNERS L.P. – TERMINALLING & STORAGE
M A R I N E S H O R E - B A S E D T E R M I N A L S
Gulf Coast Fuel and Lubricant Distribution Network
• 26 terminals along the Gulf Coast from Blakeley Island, AL to
Port O’Connor, TX
• Terminalling assets utilized by Martin Energy Services (MRMC)
to facilitate the distribution and marketing of fuel and
lubricants to oil and gas exploration and production companies,
oilfield service companies, marine transportation companies
and offshore construction companies
• Additional logistical support services provided:
• Storage and handling of tubular goods
• Loading and unloading bulk materials
• Providing facilities and equipment to store and mix
drilling fluids
• Fee-based contract structure provides stable cash flow
• MVC contract with MRMC guaranteeing minimum
fuel throughput
$19.5 $18.4
$15.7
$-
$5.0
$10.0
$15.0
$20.0
$25.0
2015 2016 2017E
Shore-Based Terminals Adjusted EBITDA
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
27
MARTIN MIDSTREAM PARTNERS L.P. – TERMINALLING & STORAGE
S M A C KO V E R R E F I N E R Y
Specialized Naphthenic Refinery
• 7,700 bpd capacity naphthenic lube refinery located in
Smackover, AR
• Specialized facility processes crude oil into finished products
including naphthenic lubricants, distillates and asphalt
• Naphthenic lubricants have customized industrial uses
including
• Transformer oils
• Rubber extenders
• Base oil for lubricants
• Fee-based contract structure provides stable cash flow
• Long-term tolling agreement with MRMC eliminates
commodity exposure and working capital
requirements
$15.4
$20.4 $20.6
$-
$5.0
$10.0
$15.0
$20.0
$25.0
2015 2016 2017E
Smackover Refinery Adjusted EBITDA
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
28
MARTIN MIDSTREAM PARTNERS L.P. – TERMINALLING & STORAGE
M A R T I N L U B R I C A N T S
Lubricant Blending & Packaging
• Specialty lubricant product blending and packaging assets
located within MMLP’s Smackover Refinery in Smackover, AR
includes:
• 235,000 sq. ft. warehouse
• 3.9 million gallons bulk storage
• MMLP purchases base oils to blend and package branded
and private label lubricants for agriculture, fleet, and
industrial applications
Grease
• Additional commercial and industrial grease processing and
packaging assets located in Kansas City, MO including:
• 75,000 sq. ft. warehouse
• 0.2 million gallons bulk storage
Packaging Facility, Smackover, AR
$8.5 $8.7
$9.4
$-
$2.0
$4.0
$6.0
$8.0
$10.0
$12.0
2015 2016 2017E
Lubricants & Grease
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
29
MARTIN MIDSTREAM PARTNERS L.P.
S U L F U R S E R V I C E S O V E R V I E W
• Molten sulfur, a refinery by-product, is aggregated, stored, prilled and transported through MMLP’s integrated value chain systems
• MMLP manufactures and markets sulfur-based fertilizers and related sulfur products (sulfuric acid) to wholesale fertilizer
distributors and industrial users
Sulfur Services
Segment
2016
Adj. EBITDA
2017E
Adj. EBITDA
Fertilizer $21.7 $15.8
Molten Sulfur $6.7 $6.6
Sulfur Prilling $6.7 $7.4
Total Sulfur
Services
$35.1 $29.8
$ millions
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
30
• Provides transportation, processing and marketing services necessary to move product from producer to consumer
• Intermodal transportation offers multiple fee opportunities for MMLP
MARTIN MIDSTREAM PARTNERS L.P. – SULFUR SERVICES
I N T E G R AT E D VA L U E C H A I N
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
31
• MMLP manufactures and markets sulfur-based fertilizers
and related sulfur products for agricultural and industrial
use from manufacturing plants in Texas, Illinois and Utah
• Typical customers include large distributors that own or
control local retail and wholesale distribution outlets
MARTIN MIDSTREAM PARTNERS L.P. – SULFUR SERVICES
F E R T I L I Z E R
Fertilizer Overview
$19.5
$21.7
$15.7
$0.0
$5.0
$10.0
$15.0
$20.0
$25.0
2015 2016 2017E
Fertilizer Adjusted EBITDA
• The single largest factor influencing fertilizer demand in the
U.S. is corn acres planted
• Global population growth is expected to further increase
demand for corn from the U.S. (food/fuel-ethanol)
• 94 million corn acres were planted in 2016, current USDA
estimate for 2017 is 90 million acres
Supply/Demand
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
32
Assets Capacity Products
Offshore Tank Barge 10,450 Long Tons Molten Sulfur
Offshore Tugboat 7,200 Horsepower N/A
Inland Push Boat 1,200 Horsepower N/A
MGM 101 2,450 Long Tons Molten Sulfur
MGM 102 2,450 Long Tons Molten Sulfur
Note: MMLP has molten sulfur storage in Tampa, FL, Beaumont, TX, Plainview, TX
and Stockton, CA
MARTIN MIDSTREAM PARTNERS L.P. – SULFUR SERVICES
M O LT E N S U L F U R
• Sulfur production is driven by refinery utilization and
demand for refined products
• Refiners require security of by-product offtake
Supply
Demand
• Demand for sulfur is primarily driven by fertilizer and
sulfuric acid demand both of which are correlated with
global economic drivers
$9.8
$6.7 $6.6
$0.0
$3.0
$6.0
$9.0
$12.0
2015 2016 2017E
Molten Sulfur Adjusted EBITDA
Handling and Transportation Agreement
• MMLP handles molten sulfur and fulfills customer needs by
transporting product from Gulf Coast refineries to the
Tampa market for fertilizer production
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
33
Terminal Location Production
Capacity
Products Stored
Neches Beaumont, TX 5,500 metric
tons/day
Molten, prilled &
granulated sulfur
Stockton Stockton, CA 1,000 metric
tons/day
Molten & prilled
sulfur
MARTIN MIDSTREAM PARTNERS L.P. – SULFUR SERVICES
P R I L L E D S U L F U R
• Refiners pay MMLP minimum reservation fees, plus
operating fees for prilling services
• Contracts consist of 3 to 5 year service agreements with
evergreen provisions – long term customer relationships
Prilling Agreements
• Security of sulfur/by-product offtake is critical to
operational stability of all refiners
• Prilled sulfur enables large scale transportation for export
on dry bulk vessels
• At Beaumont, TX the export option provides pricing
leverage for Gulf Coast refiners selling sulfur into the
domestic market
• At Stockton, CA, export is the primary option for disposal of
a refinery’s residual sulfur production
Supply/Demand
$6.7 $6.7
$7.5
$0.0
$2.0
$4.0
$6.0
$8.0
$10.0
2015 2016 2017E
Sulfur Prilling Adjusted EBITDA
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
34
MARTIN MIDSTREAM PARTNERS L.P.
M A R I N E T R A N S P O R TAT I O N O V E R V I E W
• MMLP utilizes a fleet of inland and offshore tows to provide marine transportation of petroleum products and by-products
• MMLP’s marine transportation business operates coastwise along the Gulf of Mexico, East Coast and on the U.S. inland waterway
system, primarily between domestic ports along the Gulf of Mexico, Intracoastal Waterway, the Mississippi River system and the
Tennessee-Tombigbee Waterway system.
Marine
Transportation
Segment
2016
Adj. EBITDA
2017E
Adj. EBITDA
Inland $9.6 $9.6
Offshore $3.0 $2.4
Marine SG&A $(4.5) $(4.8)
Total Marine $8.1 $7.2
$ millions
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
35
• 35 inland marine tank barges
• 19 inland push-boats
• 1 offshore tug and barge unit
• Ability to handle specialty products (asphalt, fuel oil,
gasoline, sulfur and other bulk liquids), which complements
the MMLP Specialty Terminals
• Marine Transportation contracts with other MMLP
segments, MRMC, major and independent oil and gas
refiners, and select international and domestic trading
companies
• Fee-based day-rate contracts
Insulated Hot Oil Barge Launch
MARTIN MIDSTREAM PARTNERS L.P. – MARINE TRANSPORTATION
A S S E T S
Marine Transportation
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
36
MARTIN MIDSTREAM PARTNERS L.P. – MARINE TRANSPORTATION
I N L A N D & O F F S H O R E
Profitability Drivers
• Supply of available marine equipment
• Refinery utilization and runs
• Demand for asphalt, heavy fuel oil and cutters
Current Environment
• Weak day-rate environment due to oversupply of marine
equipment
• Contract tenor trending toward short term and spot market
bias
• Asset rationalization underway. Completed divestitures
expected to reduce operating expenses by $1.4 million
annually
$16.3
$9.6 $9.7
$-
$4.0
$8.0
$12.0
$16.0
$20.0
2015 2016 2017E
Inland Marine Adjusted EBITDA
$7.3
$3.0 $2.4
$-
$2.0
$4.0
$6.0
$8.0
$10.0
2015 2016 2017E
Offshore Marine Adjusted EBITDA
R E C E N T A C Q U I S I T I O N
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
38
• $36.0 million purchase price
• $27.4 million cash at closing, with $8.6 million remaining to be spent over the next few months
• Expect substantial completion by end of second quarter and contract to commence July 1, 2017
• $5.0 million annual EBITDA supported by minimum throughput commitments (~7.2x purchase multiple)
• Contract runs through the paving season of 2030
• Approximately 178,000 barrel (32,000 ton) asphalt storage, blending and processing facility
• Approximately 40 miles west of the San Antonio city center
• Transportation advantaged over the competition in relation to serving San Antonio and the surrounding markets
• Located in close proximity to multiple major quarries
• Surrounded by numerous hot mix plants
• Strategic complement to our existing specialty terminals; specifically South Houston Asphalt, Omaha Asphalt, Tampa, and Port
Neches Asphalt
• Third party supply optionality from the gulf coast and mid-west regions
MARTIN MIDSTREAM PARTNERS L.P.
H O N D O A S P H A LT T E R M I N A L D R O P - D O W N
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
39
MARTIN MIDSTREAM PARTNERS L.P.
H O N D O A S P H A LT T E R M I N A L D R O P - D O W N
F I N A N C I A L F O U N D AT I O N
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
41
12/31/2015 12/31/2016
DEBT
Revolving Credit Facility Due 2020 $498.0 $443.0
Senior Secured Debt $498.0 $443.0
Senior Notes Due February 2021 $373.8 $373.8
Total Debt $871.8 $816.8
Partners’ Capital $393.9 $312.0
Total Capitalization $1,265.7 $1,128.8
Market Capitalization $769.4 $650.6
Enterprise Value $1,641.2 $1,467.4
CREDIT METRICS
Revolver Capacity $700.0 $664.4
Availability $202.0 $221.4
Adjusted EBITDA per lender compliance (1) $190.0 $166.4(2)
Senior Debt/Adjusted EBITDA 2.62x 2.66x
Total Debt/Adjusted EBITDA 4.59x 4.91x
Debt/Cap 68.9% 72.4%
(1) Adjusted EBITDA per lender compliance certificates
(2) Per lender compliance adjusted for divestiture of Corpus Christi terminal assets
MARTIN MIDSTREAM PARTNERS L.P.
C A P I TA L I Z AT I O N
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
42
Natural Gas
Services
Terminalling
& Storage
Sulfur Services
Marine
Transportation
SG&A
Interest
Expense
2016
Actual
Net income (loss) $43.1 $44.1 $26.8 $(19.8) $(16.4) $(46.1) $31.7
Interest expense add back -- -- -- -- -- $46.1 $46.1
Depreciation and amortization $28.1 $45.5 $8.0 $10.5 -- -- $92.1
(Gain) loss on sale of property, plant and equipment $0.1 $(35.4) $0.3 $1.6 -- -- $(33.4)
Impairment of goodwill -- -- -- $4.1 -- -- $4.1
Impairment of long lived assets -- $15.3 -- $11.7 -- -- $27.0
Unrealized mark-to-market on commodity derivatives $4.6 -- -- -- -- -- $4.6
Distributions from unconsolidated entities $7.5 -- -- -- -- -- $7.5
Equity in earnings of unconsolidated entities $(4.7) -- $(4.7)
Unit-based compensation -- -- -- -- $0.9 -- $0.9
Income tax expense -- -- -- -- $0.7 -- $0.7
Adjusted EBITDA $78.7 $69.5 $35.1 $8.1 $(14.8)* $0.0 $176.6
* Adjusted for non-cash unit based compensation of $0.9 million and non-operating income of $1.1 million.
MARTIN MIDSTREAM PARTNERS L.P.
2 0 1 6 A D J U S T E D E B I T D A A N D G A A P R E C O N C I L I AT I O N
T E X T G O E S H E R E
S U B T E X T I S P L A C E D H E R E
43
MARTIN MIDSTREAM PARTNERS L.P.
2 0 1 7 E A D J U S T E D E B I T D A G U I D A N C E R E C O N C I L I AT I O N
Natural Gas
Services
Terminalling
& Storage
Sulfur Services
Marine
Transportation
SG&A
Interest
Expense
2017E
Net income (loss) $47.5 $9.8 $21.5 $(1.2) $(17.1) $(45.6) $14.9
Interest expense add back -- -- -- -- -- $45.6 $45.6
Depreciation and amortization $28.0 $49.3 $8.3 $8.4 -- -- $94.0
Distributions from unconsolidated entities $8.8 -- -- -- -- -- $8.8
Equity in earnings of unconsolidated entities $(7.4) -- -- -- -- -- $(7.4)
Unit-based compensation -- -- -- -- $0.9 -- $0.9
Income tax expense -- -- -- -- $0.6 -- $0.6
Adjusted EBITDA $76.9 $59.1 $29.8 $7.2 $(15.6) $0.0 $157.4
2 0 1 7 | M A R T I N M I D S T R E A M P A R T N E R S
S U B T E X T I S P L A C E D H E R E