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0001176334False00011763342024-07-172024-07-17

UNITED STATES
 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K
 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d)
 
of the Securities Exchange Act of 1934
 
Date of report (date of earliest event reported): July 17, 2024
 
MARTIN MIDSTREAM PARTNERS L.P.
(Exact name of Registrant as specified in its charter)
Delaware  
000-50056
  
05-0527861
 (State of incorporation
or organization)
 (Commission file number) (I.R.S. employer identification number)
4200 Stone Road  
Kilgore, Texas 75662
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (903) 983-6200
 
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Units representing limited partnership interests MMLP The NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ☐

Exchange Act. o




Item 2.02   Results of Operations and Financial Condition.
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the On July 17, 2024, Martin Midstream Partners L.P. (the "Partnership") issued a press release reporting its financial results for the quarter ended June 30, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and will be published on the Partnership's website at www.MMLP.com. In accordance with General Instruction B.2 of Form 8-K, the information set forth herein and in the press release is deemed to be “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Item 9.01   Financial Statements and Exhibits.
 
(d)      Exhibits
 
      In accordance with General Instruction B.2 of Form 8-K, the information set forth in the attached Exhibit 99.1 and Exhibit 99.2 are deemed to be “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act.
Exhibit
Number		 Description
99.1
99.2
104
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document (contained in Exhibit 101).



 SIGNATURES
 
     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
MARTIN MIDSTREAM PARTNERS L.P.
 
By: Martin Midstream GP LLC,
Its General Partner
 
Date: July 17, 2024
   By: /s/ Sharon L. Taylor  
  Sharon L. Taylor
   
Executive Vice President and
Chief Financial Officer 
 
 

EX-99.1 2 exhibit991earningspressrel.htm EX-99.1 Document

EXHIBIT 99.1

MARTIN MIDSTREAM PARTNERS REPORTS SECOND QUARTER 2024 FINANCIAL RESULTS AND DECLARES QUARTERLY CASH DISTRIBUTION

•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

KILGORE, Texas, July 17, 2024 (BUSINESS WIRE) -- 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.




Contact:

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

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 *Related Party Transactions Included Above


MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED 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 $ 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.




EX-99.2 3 mmlp2q2024earningssummar.htm EX-99.2 mmlp2q2024earningssummar
July 17, 2024 Second Quarter 2024 Earnings Summary MARTIN MIDSTREAM PARTNERS Exhibit 99.2

 
MMLP 2Q 2024 Adjusted EBITDA Reconciliation & Comparison to Guidance (in millions) Page 2 Terminalling & Storage 2024E Guidance 2Q24 Guidance 2Q24A Smackover Refinery $16.1 $4.4 $3.1 Specialty Terminals $12.2 $3.1 $2.9 Shore-Based Terminals $5.5 $1.4 $1.5 Underground Storage $1.6 $0.5 $0.6 Total Terminalling & Storage $35.4 $9.4 $8.0 Specialty Products 2024E Guidance 2Q24 Guidance 2Q24A Lubricants $9.2 $2.9 $2.5 Grease $9.5 $2.2 $2.7 Propane $2.5 $0.2 $0.3 Natural Gasoline $1.1 $0.2 $0.3 Total Specialty Products $22.2 $5.6 $5.7 Adjusted EBITDA* $131.3 $35.0 $35.5 Unallocated SG&A $(15.2) $(3.8) $(3.8) Total Adjusted EBITDA $116.1 $31.2 $31.7 Sulfur Services 2024E Guidance 2Q24 Guidance 2Q24A Fertilizer $14.8 $6.7 $6.7 ELSA $0.9 — — Sulfur $12.5 $3.1 $3.8 Total Sulfur Services $28.3 $9.8 $10.6 Transportation 2024E Guidance 2Q24 Guidance 2Q24A Land $29.7 $6.5 $8.2 Marine $15.6 $3.8 $2.9 Total Transportation $45.4 $10.2 $11.2 Note: numbers may not add due to rounding *Pre-Unallocated SG&A Transportation Terminalling & Storage Sulfur Services Specialty Products SG&A Interest Expense 2Q 2024 Actual Net income (loss) $8.0 $3.3 $7.5 $4.9 $(5.6) $(14.4) $3.8 Interest expense add back — — — — — $14.4 $14.4 Income tax expense — — — — $1.8 — $1.8 Operating income (loss) $8.0 $3.3 $7.5 $4.9 $(3.8) $0.0 $19.9 Depreciation and amortization $3.4 $5.7 $2.8 $0.8 — — $12.7 (Gain) loss on sale of property, plant, and equipment $(0.3) $(1.0) 0.3 — — — $(1.0) Unit-based compensation — — — — $0.1 — 0.1 Adjusted EBITDA $11.2 $8.0 $10.6 $5.7 $(3.8) $0.0 $31.7

 
Page 3 MMLP 2024E Adjusted EBITDA Guidance (in millions) Note: numbers may not add due to rounding *Pre-Unallocated SG&A Terminalling & Storage 1Q24A 2Q24A 3Q24E 4Q24E 2024E Smackover Refinery $4.1 $3.1 $4.5 $4.5 $16.1 Specialty Terminals $3.1 $2.9 $3.2 $3.0 $12.2 Shore-Based Terminals $1.7 $1.5 $0.9 $1.4 $5.5 Underground Storage $0.1 $0.6 $0.5 $0.4 $1.6 Total Terminalling & Storage $9.0 $8.0 $9.0 $9.4 $35.4 Fixed-Fee Specialty Products 1Q24A 2Q24A 3Q24E 4Q24E 2024E Lubricants $1.5 $2.5 $3.6 $1.6 $9.2 Margin Grease $2.5 $2.7 $2.4 $1.9 $9.5 Margin Propane $1.1 $0.3 $0.3 $0.9 $2.5 Margin Natural Gasoline $0.3 $0.3 $0.2 $0.3 $1.1 Fixed-Fee Total Specialty Products $5.4 $5.7 $6.5 $4.6 $22.2 Sulfur Services 1Q24A 2Q24A 3Q24E 4Q24E 2024E Fertilizer $4.2 $6.7 $0.7 $3.2 $14.8 Margin ELSA — — — $0.9 $0.9 Fixed-Fee Sulfur $2.5 $3.8 $3.1 $3.1 $12.5 Fixed-Fee Total Sulfur Services $6.7 $10.6 $3.7 $7.3 $28.3 Transportation 1Q24A 2Q24A 3Q24E 4Q24E 2024E Land $9.0 $8.2 $6.4 $6.2 $29.7 Marine $4.2 $2.9 $4.4 $4.0 $15.6 Total Transportation $13.2 $11.2 $10.8 $10.2 $45.4 Fixed-Fee Adjusted EBITDA* $34.2 $35.5 $30.2 $31.5 $131.3 Unallocated SG&A $(3.8) $(3.8) $(3.8) $(3.8) $(15.2) Total Adjusted EBITDA $30.4 $31.7 $26.4 $27.7 $116.1 Included in maintenance capex is $9.8 million of turnaround costs. Included in growth capex is $18.4 million for ELSA.

 
Disclaimers Page 4 Use of Non-GAAP Financial Measures Forward Looking Statements This presentation includes certain non-GAAP financial measures such as EBITDA, Adjusted EBITDA, Distributable Cash Flow and Adjusted Free Cash Flow. 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.MMLP.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. The Partnership has not provided comparable GAAP financial information on a forward-looking basis because it would require the Partnership to create estimated ranges on a GAAP basis, which would entail unreasonable effort. Adjustments required to reconcile forward-looking non-GAAP measures cannot be predicted with reasonable certainty but may include, among others, costs related to debt amendments and unusual charges, expenses and gains. Some or all of those adjustments could be significant. 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 or operational estimates rely on a number of assumptions concerning future events and are subject to a number of uncertainties, (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 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.

 
Martin Midstream Partners 4200 B Stone Road Kilgore, Texas 75662 903.983.6200 www.MMLP.com