DocumentEXHIBIT 99.1
MARTIN MIDSTREAM PARTNERS REPORTS FIRST QUARTER 2024 FINANCIAL RESULTS AND DECLARES QUARTERLY CASH DISTRIBUTION
•Net income of $3.3 million for the first quarter of 2024 compared to a net loss of $5.1 million for the same period in 2023
•Adjusted EBITDA of $30.4 million for the first quarter of 2024 and maintains full year adjusted EBITDA guidance of $116.1 million
•Total adjusted leverage of 3.81 times as of March 31, 2024
•Declares quarterly cash dividend of $0.005 per common unit
KILGORE, Texas, April 17, 2024 (BUSINESS WIRE) -- Martin Midstream Partners L.P. (Nasdaq: MMLP) (“MMLP” or the “Partnership”) today announced its financial results for the first quarter of 2024.
Bob Bondurant, President and Chief Executive Officer of Martin Midstream GP LLC, the general partner of the Partnership, stated, “The Partnership had a strong quarter resulting in adjusted EBITDA of $30.4 million compared to guidance of $31.6 million. Demand in both the marine and land transportation divisions remain robust leading to outperformance in the transportation segment when compared to our forecast. However, lower than forecasted margins in our fertilizer and lubricants businesses, along with extended Gulf Coast refinery turnarounds resulting in lower sulfur receipts into our system, negatively impacted results as compared to first quarter projections. However, current strength in our land and marine transportation divisions should result in meeting our annual adjusted EBITDA guidance of $116.1 million."
“For the quarter, growth capital expenditures totaled $6.2 million with $4.8 million for improvements at the Plainview facility related to the DSM Semichem Joint Venture. Maintenance capital expenditures were $11.2 million for the quarter including $5.3 million in refinery turnaround costs. These higher than historical quarterly
capital expenditures contributed to our adjusted leverage increasing slightly from 3.75 times at December 31, 2023,
to 3.81 times at March 31, 2024.”
FIRST QUARTER 2024 OPERATING RESULTS BY BUSINESS SEGMENT
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Operating Income (Loss) ($M) | | Adjusted EBITDA, After Giving Effect to the Exit of the Butane Optimization Business ($M) | | Adjusted EBITDA ($M) |
| Three Months Ended March 31, |
| | 2024 | | 2023 | | 2024 | | 2023 | | 2024 | | 2023 |
| (Amounts may not add or recalculate due to rounding) |
| Business Segment: | | | | | | | | | | | |
| Terminalling and Storage | $ | 3.7 | | | $ | 3.1 | | | $ | 9.0 | | | $ | 9.1 | | | $ | 9.0 | | | $ | 9.1 | |
| Transportation | 9.8 | | | 9.4 | | | 13.2 | | | 13.2 | | | 13.2 | | | 13.2 | |
| Sulfur Services | 3.7 | | | 4.6 | | | 6.7 | | | 7.2 | | | 6.7 | | | 7.2 | |
| Specialty Products | 4.5 | | | 4.6 | | | 5.4 | | | 5.2 | | | 5.4 | | | (3.7) | |
| Unallocated Selling, General and Administrative Expense | (3.8) | | | (4.2) | | | (3.8) | | | (4.1) | | | (3.8) | | | (4.1) | |
| $ | 17.9 | | | $ | 17.5 | | | $ | 30.4 | | | $ | 30.6 | | | $ | 30.4 | | | $ | 21.7 | |
Terminalling and storage adjusted EBITDA decreased $0.1 million, reflecting increased operating expenses across our divisions, offset by higher throughput in our shore-based terminals division.
Transportation adjusted EBITDA was consistent with the first quarter of 2023 at $13.2 million, reflecting increased transportation rates in our marine transportation division and higher mileage in our land transportation division. These increases were offset by lower transportation rates and increased operating expenses in our land transportation division.
Sulfur services adjusted EBITDA decreased $0.5 million, primarily reflecting lower margins in our molten sulfur divisions coupled with decreased sulfur prilling fees as a result of Gulf Coast refinery turnarounds, offset by increased fertilizer sales volume.
Specialty products adjusted EBITDA, after giving effect to the exit of the butane optimization business, increased $0.2 million, reflecting improved margins in our NGL marketing and grease divisions, offset by lower sales volume and higher product costs in our lubricants business.
Unallocated selling, general, and administrative expense decreased $0.3 million, reflecting reduced employee-related expenses and professional fees.
CAPITALIZATION
| | | | | | | | | | | |
| | March 31, 2024 | | December 31, 2023 |
| ($ in millions) |
| Debt Outstanding: | | | |
Revolving Credit Facility, Due February 2027 1 | $ | 50.0 | | | $ | 42.5 | |
| 11.50% Senior Secured Notes, Due February 2028 | 400.0 | | | 400.0 | |
| Total Debt Outstanding: | $ | 450.0 | | | $ | 442.5 | |
| | | |
| Summary Credit Metrics: | | | |
| Revolving Credit Facility - Total Capacity | $ | 175.0 | | | $ | 175.0 | |
| Revolving Credit Facility - Available Liquidity | $ | 101.4 | | | $ | 109.0 | |
Total Adjusted Leverage Ratio 2 | 3.81x | | 3.75x |
Senior Leverage Ratio 2 | 0.42x | | 0.36x |
Interest Coverage Ratio 2 | 2.21x | | 2.19x |
1 The Partnership was in compliance with all debt covenants as of March 31, 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 (Loss) | | Net Income (Loss) 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 March 31, 2024 | | $ | 3.3 | | | $ | 0.08 | | | $ | 30.4 | | | $ | 30.4 | | | $ | 10.1 | | | $ | 5.6 | | | $ | 180.8 | |
| Three Months Ended March 31, 2023 | | $ | (5.1) | | | $ | (0.13) | | | $ | 21.7 | | | $ | 30.6 | | | $ | 49.3 | | | $ | 9.5 | | | $ | 244.5 | |
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 first quarter 2024 to the Partnership's adjusted EBITDA guidance for the first quarter 2024.
QUARTERLY CASH DISTRIBUTION
The Partnership has declared a quarterly cash distribution of $0.005 per unit for the quarter ended March 31, 2024. The distribution is payable on May 15, 2024 to common unitholders of record as of the close of business on May 8, 2024. The ex-dividend date for the cash distribution is May 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, April 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 First 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.
Contact:
Sharon Taylor - Executive Vice President & Chief Financial Officer
(877) 256-6644
ir@martinmlp.com
MMLP-F
MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND CONDENSED BALANCE SHEETS
(Dollars in thousands)
| | | | | | | | | | | |
| | March 31, 2024 | | December 31, 2023 |
| (Unaudited) | | (Audited) |
| Assets | | | |
| Cash | $ | 54 | | | $ | 54 | |
Accounts and other receivables, less allowance for doubtful accounts of $511 and $530, respectively | 58,019 | | | 53,293 | |
| | | |
| Inventories | 41,410 | | | 43,822 | |
| Due from affiliates | 6,035 | | | 7,924 | |
| | | |
| Other current assets | 10,466 | | | 9,220 | |
| | | |
| Total current assets | 115,984 | | | 114,313 | |
| | | |
| Property, plant and equipment, at cost | 928,934 | | | 918,786 | |
| Accumulated depreciation | (622,392) | | | (612,993) | |
| Property, plant and equipment, net | 306,542 | | | 305,793 | |
| | | |
| Goodwill | 16,671 | | | 16,671 | |
| Right-of-use assets | 58,267 | | | 60,359 | |
| Deferred income taxes, net | 10,526 | | | 10,200 | |
| Other assets, net | 4,087 | | | 2,039 | |
| Total assets | $ | 512,077 | | | $ | 509,375 | |
| | | |
| Liabilities and Partners’ Capital (Deficit) | | | |
| | | |
| Trade and other accounts payable | $ | 58,995 | | | $ | 51,653 | |
| Product exchange payables | 253 | | | 426 | |
| Due to affiliates | 6,002 | | | 6,334 | |
| Income taxes payable | 1,715 | | | 652 | |
| | | |
| Other accrued liabilities | 26,057 | | | 41,499 | |
| Total current liabilities | 93,022 | | | 100,564 | |
| | | |
| Long-term debt, net | 430,024 | | | 421,173 | |
| | | |
| Operating lease liabilities | 43,606 | | | 45,684 | |
| Other long-term obligations | 6,921 | | | 6,578 | |
| Total liabilities | 573,573 | | | 573,999 | |
| | | |
| Commitments and contingencies | | | |
| Partners’ capital (deficit) | (61,496) | | | (64,624) | |
| | | |
| Total liabilities and partners' capital (deficit) | $ | 512,077 | | | $ | 509,375 | |
MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except per unit amounts)
| | | | | | | | | | | | | | | |
| | | Three Months Ended |
| | | March 31, |
| | | | | 2024 | | 2023 |
| Revenues: | | | | | | | |
| Terminalling and storage * | | | | | $ | 22,517 | | | $ | 20,858 | |
| Transportation * | | | | | 58,307 | | | 55,723 | |
| Sulfur services | | | | | 3,477 | | | 3,358 | |
| Product sales: * | | | | | | | |
| Specialty products | | | | | 66,325 | | | 132,269 | |
| Sulfur services | | | | | 30,204 | | | 32,321 | |
| | | | | | | |
| | | | | | 96,529 | | | 164,590 | |
| Total revenues | | | | | 180,830 | | | 244,529 | |
| | | | | | | |
| Costs and expenses: | | | | | | | |
Cost of products sold: (excluding depreciation and amortization) | | | | | | | |
| Specialty products * | | | | | 57,230 | | | 117,995 | |
| Sulfur services * | | | | | 20,399 | | | 21,817 | |
| Terminalling and storage * | | | | | 18 | | | 6 | |
| | | | | | 77,647 | | | 139,818 | |
| Expenses: | | | | | | | |
| Operating expenses * | | | | | 63,934 | | | 62,745 | |
| Selling, general and administrative * | | | | | 8,913 | | | 11,172 | |
| | | | | | | |
| | | | | | | |
| Depreciation and amortization | | | | | 12,649 | | | 12,901 | |
| Total costs and expenses | | | | | 163,143 | | | 226,636 | |
| | | | | | | |
| Other operating income (loss), net | | | | | 208 | | | (388) | |
| | | | | | | |
| Operating income | | | | | 17,895 | | | 17,505 | |
| | | | | | | |
| Other income (expense): | | | | | | | |
| Interest expense, net | | | | | (13,842) | | | (15,657) | |
| | | | | | | |
| Loss on extinguishment of debt | | | | | — | | | (5,121) | |
| | | | | | | |
| Other, net | | | | | 16 | | | 22 | |
| Total other expense | | | | | (13,826) | | | (20,756) | |
| | | | | | | |
| Net income (loss) before taxes | | | | | 4,069 | | | (3,251) | |
| Income tax expense | | | | | (796) | | | (1,835) | |
| | | | | | | |
| | | | | | | |
| Net income (loss) | | | | | 3,273 | | | (5,086) | |
| Less general partner's interest in net income (loss) | | | | | (65) | | | 102 | |
| | | | | | | |
| Less income (loss) allocable to unvested restricted units | | | | | (12) | | | 16 | |
| Limited partners' interest in net income (loss) | | | | | $ | 3,196 | | | $ | (4,968) | |
| | | | | | | |
| Net income (loss) per unit attributable to limited partners - basic | | | | | $ | 0.08 | | | $ | (0.13) | |
| Net income (loss) per unit attributable to limited partners - diluted | | | | | $ | 0.08 | | | $ | (0.13) | |
| Weighted average limited partner units - basic | | | | | 38,828,737 | | 38,769,794 |
| Weighted average limited partner units - diluted | | | | | 38,836,165 | | 38,769,794 |
*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 |
| | | March 31, |
| | | | | 2024 | | 2023 |
| Revenues:* | | | | | | | |
| Terminalling and storage | | | | | $ | 18,549 | | | $ | 17,502 | |
| Transportation | | | | | 8,601 | | | 5,511 | |
| | | | | | | |
| Product Sales | | | | | 129 | | | 925 | |
| Costs and expenses:* | | | | | | | |
Cost of products sold: (excluding depreciation and amortization) | | | | | | | |
| Specialty products | | | | | 6,573 | | | 9,510 | |
| Sulfur services | | | | | 2,993 | | | 2,708 | |
| Terminalling and storage | | | | | 18 | | | 6 | |
| Expenses: | | | | | | | |
| Operating expenses | | | | | 26,423 | | | 23,827 | |
| Selling, general and administrative | | | | | 6,863 | | | 8,516 | |
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 |
| | | | | | | | | | | |
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| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Balances - December 31, 2022 | | | 38,850,750 | | | $ | (61,110) | | | $ | 1,665 | | | | | $ | (59,445) | |
| Net loss | | | — | | | (4,984) | | | (102) | | | | | (5,086) | |
| | | | | | | | | | | |
| Issuance of restricted units | | | 64,056 | | | — | | | — | | | | | — | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Cash distributions | | | — | | | (194) | | | (4) | | | | | (198) | |
| Unit-based compensation | | | — | | | 52 | | | — | | | | | 52 | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Balances - March 31, 2023 | | | 38,914,806 | | | $ | (66,236) | | | $ | 1,559 | | | | | $ | (64,677) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Partners’ Capital (Deficit) | | |
| | | | Common Limited | | General Partner Amount | | | | |
| | | Units | | Amount | | | | Total |
| | | | | | | | | | | |
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| | | | | | | | | | | |
| Balances - December 31, 2023 | | | 38,914,806 | | | $ | (66,182) | | | $ | 1,558 | | | | | $ | (64,624) | |
| Net income | | | — | | | 3,208 | | | 65 | | | | | 3,273 | |
| | | | | | | | | | | |
| Issuance of restricted units | | | 86,280 | | | — | | | — | | | | | — | |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Cash distributions | | | — | | | (195) | | | (4) | | | | | (199) | |
| Unit-based compensation | | | — | | | 54 | | | — | | | | | 54 | |
| | | | | | | | | | | |
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| | | | | | | | | | | |
| | | | | | | | | | | |
| Balances - March 31, 2024 | | | 39,001,086 | | | $ | (63,115) | | | $ | 1,619 | | | | | $ | (61,496) | |
MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
| | | | | | | | | | | |
| | Three Months Ended |
| March 31, |
| | 2024 | | 2023 |
| Cash flows from operating activities: | | | |
| Net income (loss) | $ | 3,273 | | | $ | (5,086) | |
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | | | |
| Depreciation and amortization | 12,649 | | | 12,901 | |
| Amortization of deferred debt issuance costs | 766 | | | 1,675 | |
| Amortization of debt discount | 600 | | | 400 | |
| | | |
| Deferred income tax expense | (326) | | | 1,177 | |
| Gain on disposition or sale of property, plant and equipment, net | (208) | | | 388 | |
| | | |
| | | |
| | | |
| Loss on extinguishment of debt | — | | | 5,121 | |
| | | |
| | | |
| | | |
| Non cash unit-based compensation | 54 | | | 52 | |
| Change in current assets and liabilities, excluding effects of acquisitions and dispositions: | | | |
| Accounts and other receivables | (4,726) | | | 6,578 | |
| | | |
| Inventories | 2,412 | | | 33,181 | |
| Due from affiliates | 1,889 | | | 4,028 | |
| Other current assets | 705 | | | 4,595 | |
| Trade and other accounts payable | 7,579 | | | (2,016) | |
| Product exchange payables | (173) | | | 104 | |
| Due to affiliates | (332) | | | (2,676) | |
| Income taxes payable | 1,063 | | | 432 | |
| Other accrued liabilities | (15,365) | | | (11,818) | |
| Change in other non-current assets and liabilities | 249 | | | 228 | |
| | | |
| | | |
| Net cash provided by operating activities | 10,109 | | | 49,264 | |
| | | |
| Cash flows from investing activities: | | | |
| Payments for property, plant and equipment | (11,670) | | | (7,527) | |
| | | |
| Payments for plant turnaround costs | (5,960) | | | (229) | |
| | | |
| Proceeds from sale of property, plant and equipment | 235 | | | 3,538 | |
| | | |
| | | |
| Net cash used in investing activities | (17,395) | | | (4,218) | |
| | | |
| Cash flows from financing activities: | | | |
| Payments of long-term debt | (57,500) | | | (462,698) | |
| Payments under finance lease obligations | — | | | (6) | |
| Proceeds from long-term debt | 65,000 | | | 431,490 | |
| | | |
| | | |
| | | |
| | | |
| Payment of debt issuance costs | (15) | | | (13,622) | |
| | | |
| Cash distributions paid | (199) | | | (198) | |
| Net cash provided by (used in) financing activities | 7,286 | | | (45,034) | |
| | | |
| Net increase (decrease) in cash | — | | | 12 | |
| Cash at beginning of period | 54 | | | 45 | |
| Cash at end of period | $ | 54 | | | $ | 57 | |
| Non-cash additions to property, plant and equipment | $ | 2,706 | | | $ | 1,813 | |
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 March 31, 2024 and 2023
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | Variance | | Percent Change |
| | 2024 | | 2023 | | |
| | (In thousands, except BBL per day) | | |
| | | | | | | |
| Revenues | $ | 24,285 | | | $ | 23,919 | | | $ | 366 | | | 2 | % |
| Cost of products sold | 18 | | | 6 | | | 12 | | | 200 | % |
| Operating expenses | 15,035 | | | 14,308 | | | 727 | | | 5 | % |
| Selling, general and administrative expenses | 282 | | | 549 | | | (267) | | | (49) | % |
| Depreciation and amortization | 5,395 | | | 5,599 | | | (204) | | | (4) | % |
| | 3,555 | | | 3,457 | | | 98 | | | 3 | % |
| Other operating income (loss), net | 102 | | | (349) | | | 451 | | | 129 | % |
| | | | | | | |
| Operating income | $ | 3,657 | | | $ | 3,108 | | | $ | 549 | | | 18 | % |
| | | | | | | |
| Shore-based throughput volumes (gallons) | 45,769 | | | 43,349 | | | 2,420 | | | 6 | % |
| Smackover refinery throughput volumes (guaranteed minimum) (BBL per day) | 6,500 | | | 6,500 | | | — | | | — | % |
Transportation Segment
Comparative Results of Operations for the Three Months Ended March 31, 2024 and 2023
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | Variance | | Percent Change |
| | 2024 | | 2023 | | |
| | (In thousands) | | |
| Revenues | $ | 62,042 | | | $ | 61,939 | | | $ | 103 | | | — | % |
| Operating expenses | 46,641 | | | 46,190 | | | 451 | | | 1 | % |
| Selling, general and administrative expenses | 2,200 | | | 2,549 | | | (349) | | | (14) | % |
| | | | | | | |
| | | | | | | |
| Depreciation and amortization | 3,476 | | | 3,762 | | | (286) | | | (8) | % |
| $ | 9,725 | | | $ | 9,438 | | | $ | 287 | | | 3 | % |
| Other operating income, net | 106 | | | 4 | | | 102 | | | 2,550 | % |
| Operating income | $ | 9,831 | | | $ | 9,442 | | | $ | 389 | | | 4 | % |
Sulfur Services Segment
Comparative Results of Operations for the Three Months Ended March 31, 2024 and 2023
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | Variance | | Percent Change |
| | 2024 | | 2023 | | |
| | (In thousands) | | |
| Revenues: | | | | | | | |
| Services | $ | 3,477 | | | $ | 3,358 | | | $ | 119 | | | 4 | % |
| Products | 30,204 | | | 32,321 | | | (2,117) | | | (7) | % |
| Total revenues | 33,681 | | | 35,679 | | | (1,998) | | | (6) | % |
| | | | | | | |
| Cost of products sold | 22,771 | | | 23,949 | | | (1,178) | | | (5) | % |
| Operating expenses | 2,940 | | | 2,899 | | | 41 | | | 1 | % |
| Selling, general and administrative expenses | 1,303 | | | 1,617 | | | (314) | | | (19) | % |
| Depreciation and amortization | 2,982 | | | 2,677 | | | 305 | | | 11 | % |
| | 3,685 | | | 4,537 | | | (852) | | | (19) | % |
| Other operating income (loss), net | — | | | 16 | | | (16) | | | (100) | % |
| | | | | | | |
| Operating income | $ | 3,685 | | | $ | 4,553 | | | $ | (868) | | | (19) | % |
| | | | | | | |
| Sulfur (long tons) | 92 | | | 74 | | | 18 | | | 24 | % |
| Fertilizer (long tons) | 73 | | | 61 | | | 12 | | | 20 | % |
| Total sulfur services volumes (long tons) | 165 | | | 135 | | | 30 | | | 22 | % |
Specialty Products Segment
Comparative Results of Operations for the Three Months Ended March 31, 2024 and 2023
| | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended March 31, | | Variance | | Percent Change |
| | 2024 | | 2023 | | |
| | (In thousands) | | |
| Products revenues | $ | 66,346 | | | $ | 132,277 | | | $ | (65,931) | | | (50) | % |
| | | | | | | |
| Cost of products sold | 59,644 | | | 124,451 | | | (64,807) | | | (52) | % |
| Operating expenses | 25 | | | 14 | | | 11 | | | 79 | % |
| Selling, general and administrative expenses | 1,323 | | | 2,290 | | | (967) | | | (42) | % |
| Depreciation and amortization | 796 | | | 863 | | | (67) | | | (8) | % |
| | 4,558 | | | 4,659 | | | (101) | | | (2) | % |
| Other operating income (loss), net | — | | | (59) | | | 59 | | | 100 | % |
| Operating income | $ | 4,558 | | | $ | 4,600 | | | $ | (42) | | | (1) | % |
| | | | | | | |
| NGL sales volumes (Bbls) | 622 | | | 1,691 | | | (1,069) | | | (63) | % |
| Other specialty products volumes (Bbls) | 80 | | | 84 | | | (4) | | | (5) | % |
| Total specialty products volumes (Bbls) | 702 | | | 1,775 | | | (1,073) | | | (60) | % |
Unallocated Selling, General and Administrative Expenses
Comparative Results of Operations for the Three and Three Months Ended March 31, 2024 and 2023
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | Three Months Ended March 31, | | Variance | | Percent Change |
| | | | | | | | 2024 | | 2023 | | |
| | | | | | (In thousands) | | |
| Indirect selling, general and administrative expenses | | | | | | | | | $ | 3,836 | | | $ | 4,198 | | | $ | (362) | | | (9) | % |
`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 months ended March 31, 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 March 31, |
| |
| | | | | | 2024 | | 2023 |
| | | (in thousands) |
| Net income (loss) | | | | | $ | 3,273 | | | $ | (5,086) | |
| Adjustments: | | | | | | | |
| Interest expense | | | | | 13,842 | | | 15,657 | |
| Income tax expense | | | | | 796 | | | 1,835 | |
| Depreciation and amortization | | | | | 12,649 | | | 12,901 | |
| EBITDA | | | | | 30,560 | | | 25,307 | |
| Adjustments: | | | | | | | |
| (Gain) loss on disposition or sale of property, plant and equipment | | | | | (208) | | | 388 | |
| Loss on extinguishment of debt | | | | | — | | | 5,121 | |
| Lower of cost or net realizable value and other non-cash adjustments | | | | | — | | | (9,133) | |
| Unit-based compensation | | | | | 54 | | | 52 | |
| Adjusted EBITDA | | | | | $ | 30,406 | | | $ | 21,735 | |
| Adjustments: | | | | | | | |
| Less: net loss associated with butane optimization business | | | | | — | | | (305) | |
| Plus: lower of cost or net realizable value and other non-cash adjustments | | | | | — | | | 9,133 | |
Adjusted EBITDA after giving effect to the exit of the butane optimization business | | | | | $ | 30,406 | | | $ | 30,563 | |
Reconciliation of Net Cash Provided by (Used in) 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 March 31, |
| |
| | | | | | 2024 | | 2023 |
| | | (in thousands) |
| Net cash provided by (used in) operating activities | | | | | $ | 10,109 | | | $ | 49,264 | |
Interest expense 1 | | | | | 12,476 | | | 13,582 | |
| Current income tax expense | | | | | 1,122 | | | 658 | |
| Lower of cost or net realizable value and other non-cash adjustments | | | | | — | | | (9,133) | |
| Changes in operating assets and liabilities which (provided) used cash: | | | | | | | |
| Accounts and other receivables, inventories, and other current assets | | | | | (280) | | | (48,382) | |
| Trade, accounts and other payables, and other current liabilities | | | | | 7,228 | | | 15,974 | |
| Other | | | | | (249) | | | (228) | |
| Adjusted EBITDA | | | | | 30,406 | | | 21,735 | |
| Adjustments: | | | | | | | |
| Less: net loss associated with butane optimization business | | | | | — | | | (305) | |
| Plus: lower of cost or net realizable value and other non-cash adjustments | | | | | — | | | 9,133 | |
Adjusted EBITDA after giving effect to the exit of the butane optimization business | | | | | 30,406 | | | 30,563 | |
| Adjustments: | | | | | | | |
| Interest expense | | | | | (13,842) | | | (15,657) | |
| Income tax expense | | | | | (796) | | | (1,835) | |
| Deferred income taxes | | | | | (326) | | | 1,177 | |
| Amortization of debt discount | | | | | 600 | | | 400 | |
| Amortization of deferred debt issuance costs | | | | | 766 | | | 1,675 | |
| Payments for plant turnaround costs | | | | | (5,960) | | | (229) | |
| Maintenance capital expenditures | | | | | (5,202) | | | (6,634) | |
| Distributable cash flow | | | | | 5,646 | | | 9,460 | |
| Principal payments under finance lease obligations | | | | | — | | | (6) | |
| Expansion capital expenditures | | | | | (6,231) | | | (757) | |
| Adjusted free cash flow | | | | | $ | (585) | | | $ | 8,697 | |
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.
