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Martin Midstream Partners Reports Second Quarter 2021 Financial Results and Declares Quarterly Cash Distribution

  • 2021 financial performance in line with annual guidance
  • Reported net loss of $6.6 million and $4.1 million for the three and six months ended June 30, 2021, respectively
  • Reported adjusted EBITDA of $22.5 million and $53.4 million for the three and six months ended June 30, 2021, respectively
  • Generated distributable cash flow of $7.3 and $20.1 million for the three and six months ended June 30, 2021, respectively
  • Declares quarterly distribution of $0.005 or $0.02 per unit annually
  • Announces Revolving Credit Facility Amendment

Martin Midstream Partners L.P. (Nasdaq:MMLP) (the "Partnership") today announced its financial results for the second quarter of 2021.

“For the second quarter of 2021, the Partnership had a solid performance in line with our annual projected cash flows of between $95 million to $102 million,” stated Bob Bondurant, President and Chief Executive Officer of Martin Midstream GP LLC, the general partner of the Partnership. “As the country returns to a more open economy and refinery utilization increases, we have seen heightened demand for our services particularly within the land transportation and lubricants businesses. However, the impact of COVID-19 is still reflected in a reduction in sulfur service volumes and lower marine day rates year over year. As expected, marine utilization has increased from last quarter and we anticipate the continued economic recovery will drive demand upward allowing for the further utilization of our asset base.”

“Looking to the third quarter, which is seasonally our weakest due to the cyclical nature of both the fertilizer and butane businesses, we amended our revolving credit facility in response to rising commodity prices and the continued impact of COVID-19 on the Partnership’s trailing twelve month cash flows. I’d like thank our lenders for recognizing our ongoing commitment to capital discipline through their support of the amendment.”

SECOND QUARTER 2021 OPERATING RESULTS BY BUSINESS SEGMENT

TERMINALLING AND STORAGE (“T&S”)

T&S Operating Income for the three months ended June 30, 2021 and 2020 was $3.7 million and $3.3 million, respectively.

Adjusted segment EBITDA for T&S was $10.6 million for each of the three month periods ended June 30, 2021 and 2020, reflecting increased volumes on packaged lubricants products, offset by expired capital recovery fees at the Smackover Refinery.

TRANSPORTATION

Transportation Operating Income for the three months ended June 30, 2021 and 2020 was $0.7 million and $0.6 million, respectively.

Adjusted segment EBITDA for Transportation was $5.0 million and $4.9 million for the three months ended June 30, 2021 and 2020, respectively, reflecting higher land transportation load count and rates, offset by lower marine day rates coupled with a reduction in marine equipment.

SULFUR SERVICES

Sulfur Services Operating Income for the three months ended June 30, 2021 and 2020 was $6.3 million and $7.4 million, respectively.

Adjusted segment EBITDA for Sulfur Services was $8.9 million and $10.8 million for the three months ended June 30, 2021 and 2020, respectively, reflecting lower refinery utilization volumes during the second quarter of 2021 as a result of continued effects of COVID-19.

NATURAL GAS LIQUIDS (“NGL”)

NGL Operating Income for the three months ended June 30, 2021 and 2020 was $0.7 million and $1.1 million, respectively.

Adjusted segment EBITDA for NGL was $1.7 million and $1.6 million for the three months ended June 30, 2021 and 2020, respectively, primarily reflecting increased margins in our butane optimization business, offset by a reduction in NGL margins due to rising commodity prices.

UNALLOCATED SELLING, GENERAL AND ADMINISTRATIVE EXPENSE (“USGA”)

USGA expenses included in operating income for the three months ended June 30, 2021 and 2020 were $3.8 million and $4.4 million, respectively.

USGA expenses included in adjusted EBITDA for the three months ended June 30, 2021 and 2020 were $3.7 million and $4.0 million, respectively, primarily reflecting a reduction in overhead allocated from Martin Resource Management.

LIQUIDITY

At June 30, 2021, the Partnership had $180 million drawn on its $300 million revolving credit facility, an increase of $4 million from March 31, 2021. The Partnership’s leverage ratio, as calculated under the revolving credit facility, was 5.3 times and 5.4 times on June 30, 2021 and March 31, 2021, respectively. The Partnership is in compliance with all debt covenants as of June 30, 2021 and March 31, 2021.

REVOLVING CREDIT FACILITY AMENDMENT

The Partnership announced today the amendment of its revolving credit facility effective July 16, 2021. The amendment revises certain financial covenant ratios and reduces the aggregate amount of commitments from $300 million to $275 million, among other things.

Royal Bank of Canada serves as administrative agent and collateral agent for the facility. Baker Botts L.L.P acted as legal counsel to the Partnership.

QUARTERLY CASH DISTRIBUTION

The Partnership has declared a quarterly cash distribution of $0.005 per unit for the quarter ended June 30, 2021. The distribution is payable on August 13, 2021 to common unitholders of record as of the close of business on August 6, 2021. The ex-dividend date for the cash distribution is August 5, 2021.

QUALIFIED NOTICE TO NOMINEES

This release serves as qualified notice to nominees as provided for under Treasury Regulation Section 1.1446-4(b)(4) and (d). Please note that 100 percent of the Partnership's distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, all of the Partnership's distributions to foreign investors are subject to federal income tax withholding at the highest effective tax rate for individuals or corporations, as applicable. Nominees, and not the Partnership, are treated as withholding agents responsible for withholding on the distributions received by them on behalf of foreign investors.

COVID-19 RESPONSE

The Partnership continues to evaluate protocols in response to the COVID-19 pandemic, including the impact of variants of COVID-19, such as the Delta variant. Where possible, employee work from home initiatives remain and travel restrictions have been lifted. Employees are encouraged to continue to exercise safety measures to protect the welfare of each other and the communities they serve.

RESULTS OF OPERATIONS

The Partnership had a net loss for the three months ended June 30, 2021 of $6.6 million, a loss of $0.17 per limited partner unit. The Partnership had a net loss for the three months ended June 30, 2020 of $2.2 million, a loss of $0.06 per limited partner unit. Adjusted EBITDA for the three months ended June 30, 2021 was $22.5 million compared to the three months ended June 30, 2020 of $23.9 million. Distributable cash flow for the three months ended June 30, 2021 was $7.3 million compared to the three months ended June 30, 2020 of $12.5 million.

The Partnership had a net loss for the six months ended June 30, 2021 of $4.1 million, a loss of $0.10 per limited partner unit. The Partnership had net income for the six months ended June 30, 2020 of $6.6 million, or $0.17 per limited partner unit. Adjusted EBITDA for the six months ended June 30, 2021 was $53.4 million compared to the six months ended June 30, 2020 of $54.9 million. Distributable cash flow for the six months ended June 30, 2021 was $20.1 million compared to the six months ended June 30, 2020 of $30.8 million.

Revenues for the three months ended June 30, 2021 were $184.3 million compared to the three months ended June 30, 2020 of $140.6 million. Revenues for the six months ended June 30, 2021 were $385.3 million compared to the six months ended June 30, 2020 of $339.5 million.

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 2021 to the Partnership's Adjusted EBITDA for the second quarter 2020.

Investors' Conference Call

Date: Friday, July 23, 2021

Time: 8:00 a.m. CT (please dial in by 7:55 a.m.)

Dial In #: (833) 900-2251

Conference ID: 1691938

Replay Dial In # (800) 585-8367 – Conference ID: 1691938

A webcast of the conference call 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 L.P., headquartered in Kilgore, Texas, is a publicly traded limited partnership with a diverse set of operations focused primarily in the United States Gulf Coast region. The Partnership's primary business lines include: (1) terminalling, processing, storage, and packaging 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) natural gas liquids marketing, distribution and transportation services. To learn more, visit www.MMLP.com.

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 guidance or to financial or operational estimates or projections rely on a number of assumptions concerning future events and are subject to a number of uncertainties, including (i) the current and potential impacts of the COVID-19 pandemic generally, on an industry-specific basis, and on the Partnership’s specific operations and business, (ii) the effects of the continued volatility of commodity prices and the related macroeconomic and political environment, and (iii) 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.

Use of Non-GAAP Financial Information

The Partnership's management uses a variety of financial and operational measurements other than its financial statements prepared in accordance with United States Generally Accepted Accounting Principles ("GAAP") to analyze its performance. These include: (1) net income before interest expense, income tax expense, and depreciation and amortization ("EBITDA"), (2) adjusted EBITDA, (3) distributable cash flow and (4) adjusted free cash flow. The Partnership's management views these measures as important performance measures of core profitability for its operations and the ability to generate and distribute cash flow, and as key components of its internal financial reporting. The Partnership's management believes investors benefit from having access to the same financial measures that management uses.

EBITDA and Adjusted EBITDA. The Partnership defines 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. 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. The Partnership has included information concerning EBITDA and adjusted EBITDA because it provides investors and management with additional information to better understand the following: financial performance of the Partnership's assets without regard to financing methods, capital structure or historical cost basis; the Partnership's operating performance and return on capital as compared to those of other similarly situated entities; and the viability of acquisitions and capital expenditure projects. The Partnership's method of computing adjusted EBITDA may not be the same method used to compute similar measures reported by other entities. The economic substance behind the Partnership's use of adjusted EBITDA is to measure the ability of the Partnership's assets to generate cash sufficient to pay interest costs, support its indebtedness and make distributions to its unitholders.

Distributable Cash Flow. The Partnership defines Distributable Cash Flow as Adjusted EBITDA less cash paid for interest, cash paid for income taxes, maintenance capital expenditures, and plant turnaround costs. Distributable cash flow is a significant performance measure used by the Partnership's management and by external users of its financial statements, such as investors, commercial banks and research analysts, to compare basic cash flows generated by the Partnership to the cash distributions it expects to pay unitholders. Distributable cash flow is also an important financial measure for the Partnership's unitholders since it serves as an indicator of the Partnership's success in providing a cash return on investment. Specifically, this financial measure indicates to investors whether or not the Partnership is generating cash flow at a level that can sustain or support an increase in its 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.

Adjusted Free Cash Flow. Adjusted free cash flow is defined 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 the Partnership's 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. The Partnership believes 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. The Partnership's calculation of adjusted free cash flow may or may not be comparable to similarly titled measures used by other entities.

EBITDA, adjusted EBITDA, distributable cash flow, and adjusted free cash flow should not be considered alternatives to, or more meaningful than, net income, cash flows from operating activities, or any other measure presented in accordance with GAAP. The Partnership's method of computing these measures may not be the same method used to compute similar measures reported by other entities.

MMLP-F

MARTIN MIDSTREAM PARTNERS L.P.

CONSOLIDATED AND CONDENSED BALANCE SHEETS

(Dollars in thousands)

 

 

June 30, 2021

 

December 31, 2020

 

(Unaudited)

 

(Audited)

Assets

 

 

 

Cash

$

681

 

 

$

4,958

 

Accounts and other receivables, less allowance for doubtful accounts of $225 and $261, respectively

 

55,051

 

 

 

52,748

 

Inventories

 

71,358

 

 

 

54,122

 

Due from affiliates

 

20,619

 

 

 

14,807

 

Other current assets

 

6,913

 

 

 

8,991

 

Total current assets

 

154,622

 

 

 

135,626

 

 

 

 

 

Property, plant and equipment, at cost

 

891,746

 

 

 

889,108

 

Accumulated depreciation

 

(530,624

)

 

 

(509,237

)

Property, plant and equipment, net

 

361,122

 

 

 

379,871

 

 

 

 

 

Goodwill

 

16,823

 

 

 

16,823

 

Right-of-use assets

 

19,955

 

 

 

22,260

 

Deferred income taxes, net

 

21,495

 

 

 

22,253

 

Other assets, net

 

2,862

 

 

 

2,805

 

Total assets

$

576,879

 

 

$

579,638

 

 

 

 

 

Liabilities and Partners’ Capital (Deficit)

 

 

 

Current installments of long-term debt and finance lease obligations

$

236

 

 

$

31,497

 

Trade and other accounts payable

 

55,453

 

 

 

51,900

 

Product exchange payables

 

700

 

 

 

373

 

Due to affiliates

 

1,939

 

 

 

435

 

Income taxes payable

 

308

 

 

 

556

 

Fair value of derivatives

 

412

 

 

 

207

 

Other accrued liabilities

 

29,394

 

 

 

34,407

 

Total current liabilities

 

88,442

 

 

 

119,375

 

 

 

 

 

Long-term debt, net

 

517,311

 

 

 

484,597

 

Finance lease obligations

 

169

 

 

 

289

 

Operating lease liabilities

 

13,423

 

 

 

15,181

 

Other long-term obligations

 

8,631

 

 

 

7,067

 

Total liabilities

 

627,976

 

 

 

626,509

 

 

 

 

 

Commitments and contingencies

 

 

 

Partners’ capital (deficit)

 

(51,097

)

 

 

(46,871

)

Total partners’ capital (deficit)

 

(51,097

)

 

 

(46,871

)

Total liabilities and partners' capital (deficit)

$

576,879

 

 

$

579,638

 

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,

 

2021

 

2020

 

2021

 

2020

Revenues:

 

 

 

 

 

 

 

Terminalling and storage *

$

18,702

 

 

$

19,908

 

 

$

37,080

 

 

$

40,382

 

Transportation *

 

34,926

 

 

 

31,485

 

 

 

64,741

 

 

 

70,426

 

Sulfur services

 

2,949

 

 

 

2,914

 

 

 

5,899

 

 

 

5,829

 

Product sales: *

 

 

 

 

 

 

 

Natural gas liquids

 

67,232

 

 

 

30,299

 

 

 

165,317

 

 

 

112,510

 

Sulfur services

 

35,337

 

 

 

30,506

 

 

 

67,222

 

 

 

55,914

 

Terminalling and storage

 

25,147

 

 

 

25,526

 

 

 

45,008

 

 

 

54,460

 

 

 

127,716

 

 

 

86,331

 

 

 

277,547

 

 

 

222,884

 

Total revenues

 

184,293

 

 

 

140,638

 

 

 

385,267

 

 

 

339,521

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

Cost of products sold: (excluding depreciation and amortization)

 

 

 

 

 

 

 

Natural gas liquids *

 

61,590

 

 

 

24,293

 

 

 

140,725

 

 

 

94,128

 

Sulfur services *

 

24,177

 

 

 

17,559

 

 

 

45,391

 

 

 

32,854

 

Terminalling and storage *

 

20,226

 

 

 

21,438

 

 

 

34,728

 

 

 

45,118

 

 

 

105,993

 

 

 

63,290

 

 

 

220,844

 

 

 

172,100

 

Expenses:

 

 

 

 

 

 

 

Operating expenses *

 

47,313

 

 

 

44,202

 

 

 

91,947

 

 

 

95,484

 

Selling, general and administrative *

 

8,960

 

 

 

9,858

 

 

 

19,569

 

 

 

20,320

 

Depreciation and amortization

 

14,483

 

 

 

15,343

 

 

 

28,917

 

 

 

30,582

 

Total costs and expenses

 

176,749

 

 

 

132,693

 

 

 

361,277

 

 

 

318,486

 

 

 

 

 

 

 

 

 

Other operating income (loss), net

 

89

 

 

 

15

 

 

 

(671

)

 

 

2,525

 

Operating income

 

7,633

 

 

 

7,960

 

 

 

23,319

 

 

 

23,560

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

Interest expense, net

 

(13,309

)

 

 

(9,377

)

 

 

(26,262

)

 

 

(19,302

)

Gain on retirement of senior unsecured notes

 

 

 

 

 

 

 

 

 

 

3,484

 

Other, net

 

(1

)

 

 

4

 

 

 

(1

)

 

 

7

 

Total other expense

 

(13,310

)

 

 

(9,373

)

 

 

(26,263

)

 

 

(15,811

)

 

 

 

 

 

 

 

 

Net income (loss) before taxes

 

(5,677

)

 

 

(1,413

)

 

 

(2,944

)

 

 

7,749

 

Income tax expense

 

(935

)

 

 

(790

)

 

 

(1,157

)

 

 

(1,137

)

Net income (loss)

 

(6,612

)

 

 

(2,203

)

 

 

(4,101

)

 

 

6,612

 

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

 

132

 

 

 

44

 

 

 

82

 

 

 

(132

)

Less (income) loss allocable to unvested restricted units

 

20

 

 

 

10

 

 

 

10

 

 

 

(45

)

Limited partners' interest in net income (loss)

$

(6,460

)

 

$

(2,149

)

 

$

(4,009

)

 

$

6,435

 

 

 

 

 

 

 

 

 

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

$

(0.17

)

 

$

(0.06

)

 

$

(0.10

)

 

$

0.17

 

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

$

(0.17

)

 

$

(0.06

)

 

$

(0.10

)

 

$

0.17

 

Weighted average limited partner units - basic

 

38,687,874

 

 

 

38,661,852

 

 

 

38,690,228

 

 

 

38,651,357

 

Weighted average limited partner units - diluted

 

38,687,874

 

 

 

38,661,852

 

 

 

38,690,228

 

 

 

38,651,897

 

 

*Related Party Transactions Shown Below

MARTIN MIDSTREAM PARTNERS L.P.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(Dollars in thousands, except per unit amounts)

 

*Related Party Transactions Included Above

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

2021

 

2020

 

2021

 

2020

Revenues:*

 

 

 

 

 

 

 

Terminalling and storage

$

15,569

 

$

15,942

 

$

30,875

 

$

31,816

Transportation

 

4,889

 

 

5,393

 

 

8,899

 

 

11,287

Product Sales

 

71

 

 

38

 

 

185

 

 

130

Costs and expenses:*

 

 

 

 

 

 

 

Cost of products sold: (excluding depreciation and amortization)

 

 

 

 

 

 

 

Sulfur services

 

2,403

 

 

2,554

 

 

4,938

 

 

5,321

Terminalling and storage

 

7,036

 

 

4,249

 

 

11,604

 

 

10,026

Expenses:

 

 

 

 

 

 

 

Operating expenses

 

19,590

 

 

19,440

 

 

37,958

 

 

41,211

Selling, general and administrative

 

7,285

 

 

8,055

 

 

15,965

 

 

16,367

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 - January 1, 2020

38,863,389

 

 

$

(38,342

)

 

$

2,146

 

 

$

(36,196

)

Net income

 

 

 

6,480

 

 

 

132

 

 

 

6,612

 

Issuance of common units, net

 

 

 

 

 

 

 

 

 

 

Issuance of restricted units

81,000

 

 

 

 

 

 

 

 

 

 

Forfeiture of restricted units

(84,134

)

 

 

 

 

 

 

 

 

 

General partner contribution

 

 

 

 

 

 

 

 

 

 

Cash distributions

 

 

 

(4,825

)

 

 

(98

)

 

 

(4,923

)

Unit-based compensation

 

 

 

709

 

 

 

 

 

 

709

 

Purchase of treasury units

(7,748

)

 

 

(9

)

 

 

 

 

 

(9

)

Balances - June 30, 2020

38,852,507

 

 

$

(35,987

)

 

$

2,180

 

 

$

(33,807

)

 

 

 

 

 

 

 

 

Balances - January 1, 2021

38,851,174

 

 

$

(48,776

)

 

$

1,905

 

 

$

(46,871

)

Net loss

 

 

 

(4,019

)

 

 

(82

)

 

 

(4,101

)

Issuance of restricted units

42,168

 

 

 

 

 

 

 

 

 

 

Forfeiture of restricted units

(83,436

)

 

 

 

 

 

 

 

 

 

Cash distributions

 

 

 

(388

)

 

 

(8

)

 

 

(396

)

Unit-based compensation

 

 

 

288

 

 

 

 

 

 

288

 

Purchase of treasury units

(7,156

)

 

 

(17

)

 

 

 

 

 

(17

)

Balances - June 30, 2021

38,802,750

 

 

$

(52,912

)

 

$

1,815

 

 

$

(51,097

)

MARTIN MIDSTREAM PARTNERS L.P.

CONSOLIDATED AND CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

(Dollars in thousands)

 

 

Six Months Ended

 

June 30,

 

2021

 

2020

Cash flows from operating activities:

 

 

 

Net income (loss)

$

(4,101

)

 

$

6,612

 

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

 

 

 

Depreciation and amortization

 

28,917

 

 

 

30,582

 

Amortization of deferred debt issuance costs

 

1,521

 

 

 

991

 

Amortization of premium on notes payable

 

 

 

 

(153

)

Deferred income tax expense

 

758

 

 

 

1,018

 

Loss on sale of property, plant and equipment, net

 

671

 

 

 

175

 

Gain on retirement of senior unsecured notes

 

 

 

 

(3,484

)

Derivative (income) loss

 

884

 

 

 

(1,463

)

Net cash received (paid) for commodity derivatives

 

(679

)

 

 

796

 

Unit-based compensation

 

288

 

 

 

709

 

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

 

 

 

Accounts and other receivables

 

(2,303

)

 

 

37,180

 

Inventories

 

(17,572

)

 

 

(3,128

)

Due from affiliates

 

(5,812

)

 

 

(1,060

)

Other current assets

 

1,435

 

 

 

(5,547

)

Trade and other accounts payable

 

3,335

 

 

 

(16,502

)

Product exchange payables

 

327

 

 

 

811

 

Due to affiliates

 

1,504

 

 

 

(1,026

)

Income taxes payable

 

(248

)

 

 

26

 

Other accrued liabilities

 

(3,053

)

 

 

(2,452

)

Change in other non-current assets and liabilities

 

213

 

 

 

541

 

Net cash provided by operating activities

 

6,085

 

 

 

44,626

 

 

 

 

 

Cash flows from investing activities:

 

 

 

Payments for property, plant and equipment

 

(8,200

)

 

 

(19,053

)

Payments for plant turnaround costs

 

(1,694

)

 

 

(231

)

Proceeds from involuntary conversion of property, plant and equipment

 

 

 

 

4,369

 

Proceeds from sale of property, plant and equipment

 

133

 

 

 

1,768

 

Net cash used in investing activities

 

(9,761

)

 

 

(13,147

)

 

 

 

 

Cash flows from financing activities:

 

 

 

Payments of long-term debt

 

(144,790

)

 

 

(156,860

)

Payments under finance lease obligations

 

(2,591

)

 

 

(3,222

)

Proceeds from long-term debt

 

147,500

 

 

 

131,000

 

Purchase of treasury units

 

(17

)

 

 

(9

)

Payment of debt issuance costs

 

(307

)

 

 

(269

)

Cash distributions paid

 

(396

)

 

 

(4,923

)

Net cash used in financing activities

 

(601

)

 

 

(34,283

)

 

 

 

 

Net decrease in cash

 

(4,277

)

 

 

(2,804

)

Cash at beginning of period

 

4,958

 

 

 

2,856

 

Cash at end of period

$

681

 

 

$

52

 

Non-cash additions to property, plant and equipment

$

686

 

 

$

1,276

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, 2021 and 2020

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Variance

 

Percent

Change

 

2021

 

2020

 

 

 

(In thousands, except BBL per day)

 

 

Revenues:

 

 

 

 

 

 

 

Services

$

20,358

 

$

21,436

 

 

$

(1,078

)

 

(5

)%

Products

 

25,166

 

 

25,540

 

 

 

(374

)

 

(1

)%

Total revenues

 

45,524

 

 

46,976

 

 

 

(1,452

)

 

(3

)%

 

 

 

 

 

 

 

 

Cost of products sold

 

20,759

 

 

22,697

 

 

 

(1,938

)

 

(9

)%

Operating expenses

 

12,664

 

 

12,254

 

 

 

410

 

 

3

%

Selling, general and administrative expenses

 

1,468

 

 

1,398

 

 

 

70

 

 

5

%

Depreciation and amortization

 

6,996

 

 

7,272

 

 

 

(276

)

 

(4

)%

 

 

3,637

 

 

3,355

 

 

 

282

 

 

8

%

Other operating income (loss), net

 

61

 

 

(3

)

 

 

64

 

 

2,133

%

Operating income

$

3,698

 

$

3,352

 

 

$

346

 

 

10

%

 

 

 

 

 

 

 

 

Shore-based throughput volumes (guaranteed minimum) (gallons)

 

20,000

 

 

20,000

 

 

 

 

 

%

Smackover refinery throughput volumes (guaranteed minimum BBL per day)

 

6,500

 

 

6,500

 

 

 

 

 

%

Comparative Results of Operations for the Six Months Ended June 30, 2021 and 2020

 

 

Six Months Ended

June 30,

 

Variance

 

Percent

Change

 

2021

 

2020

 

 

 

(In thousands, except BBL per day)

 

 

Revenues:

 

 

 

 

 

 

 

Services

$

40,317

 

 

$

43,603

 

 

$

(3,286

)

 

(8

)%

Products

 

45,041

 

 

 

54,507

 

 

 

(9,466

)

 

(17

)%

Total revenues

 

85,358

 

 

 

98,110

 

 

 

(12,752

)

 

(13

)%

 

 

 

 

 

 

 

 

Cost of products sold

 

35,700

 

 

 

47,685

 

 

 

(11,985

)

 

(25

)%

Operating expenses

 

25,457

 

 

 

25,205

 

 

 

252

 

 

1

%

Selling, general and administrative expenses

 

2,967

 

 

 

3,057

 

 

 

(90

)

 

(3

)%

Depreciation and amortization

 

14,101

 

 

 

14,728

 

 

 

(627

)

 

(4

)%

 

 

7,133

 

 

 

7,435

 

 

 

(302

)

 

(4

)%

Other operating loss, net

 

(5

)

 

 

(3,054

)

 

 

3,049

 

 

100

%

Operating income

$

7,128

 

 

$

4,381

 

 

$

2,747

 

 

63

%

 

 

 

 

 

 

 

 

Shore-based throughput volumes (guaranteed minimum) (gallons)

 

40,000

 

 

 

40,000

 

 

 

 

 

%

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, 2021 and 2020

 

 

Three Months Ended

June 30,

Variance

Percent

Change

 

2021

2020

 

(In thousands)

 

 

Revenues

$

38,349

 

$

35,259

 

$

3,090

 

9

%

Operating expenses

 

31,485

 

28,331

 

3,154

 

11

%

Selling, general and administrative expenses

 

1,858

 

2,058

 

(200

)

(10

)%

Depreciation and amortization

 

4,331

 

4,328

 

3

 

%

 

 

675

 

542

 

133

 

25

%

Other operating income, net

 

21

 

13

 

8

 

62

%

Operating income

$

696

$

555

$

141

 

25

%

Comparative Results of Operations for the Six Months Ended June 30, 2021 and 2020

 

 

Six Months Ended

June 30,

 

Variance

 

Percent

Change

 

2021

 

2020

 

 

 

(In thousands)

 

 

Revenues

$

72,318

 

 

$

80,433

 

 

$

(8,115

)

 

(10

)%

Operating expenses

 

60,989

 

 

 

63,493

 

 

 

(2,504

)

 

(4

)%

Selling, general and administrative expenses

 

3,658

 

 

 

4,193

 

 

 

(535

)

 

(13

)%

Depreciation and amortization

 

8,329

 

 

 

8,608

 

 

 

(279

)

 

(3

)%

 

$

(658

)

 

$

4,139

 

 

$

(4,797

)

 

(116

)%

Other operating income (loss), net

 

17

 

 

 

(1,195

)

 

 

1,212

 

 

101

%

Operating income (loss)

$

(641

)

 

$

2,944

 

 

$

(3,585

)

 

(122

)%

Sulfur Services Segment

 

Comparative Results of Operations for the Three Months Ended June 30, 2021 and 2020

 

 

Three Months Ended

June 30,

 

Variance

 

Percent

Change

 

2021

 

2020

 

 

 

(In thousands)

 

 

Revenues:

 

 

 

 

 

 

 

Services

$

2,949

 

$

2,914

 

$

35

 

 

1

%

Products

 

35,337

 

 

30,506

 

 

4,831

 

 

16

%

Total revenues

 

38,286

 

 

33,420

 

 

4,866

 

 

15

%

 

 

 

 

 

 

 

 

Cost of products sold

 

25,397

 

 

18,601

 

 

6,796

 

 

37

%

Operating expenses

 

2,804

 

 

3,142

 

 

(338

)

 

(11

)%

Selling, general and administrative expenses

 

1,215

 

 

1,166

 

 

49

 

 

4

%

Depreciation and amortization

 

2,568

 

 

3,131

 

 

(563

)

 

(18

)%

 

 

6,302

 

 

7,380

 

 

(1,078

)

 

(15

)%

Other operating income, net

 

6

 

 

5

 

 

1

 

 

20

%

Operating income

$

6,308

 

$

7,385

 

$

(1,077

)

 

(15

)%

 

 

 

 

 

 

 

 

Sulfur (long tons)

 

146

 

 

166

 

 

(20

)

 

(12

)%

Fertilizer (long tons)

 

84

 

 

91

 

 

(7

)

 

(8

)%

Total sulfur services volumes (long tons)

 

230

 

 

257

 

 

(27

)

 

(11

)%

Comparative Results of Operations for the Six Months Ended June 30, 2021 and 2020

 

 

Six Months Ended

June 30,

 

Variance

 

Percent

Change

 

2021

 

2020

 

 

 

(In thousands)

 

 

Revenues:

 

 

 

 

 

 

 

Services

$

5,899

 

$

5,829

 

$

70

 

 

1

%

Products

 

67,222

 

 

55,927

 

 

11,295

 

 

20

%

Total revenues

 

73,121

 

 

61,756

 

 

11,365

 

 

18

%

 

 

 

 

 

 

 

 

Cost of products sold

 

47,820

 

 

35,405

 

 

12,415

 

 

35

%

Operating expenses

 

4,813

 

 

6,052

 

 

(1,239

)

 

(20

)%

Selling, general and administrative expenses

 

2,456

 

 

2,369

 

 

87

 

 

4

%

Depreciation and amortization

 

5,288

 

 

6,025

 

 

(737

)

 

(12

)%

 

 

12,744

 

 

11,905

 

 

839

 

 

7

%

Other operating income, net

 

6

 

 

6,776

 

 

(6,770

)

 

(100

)%

Operating income

$

12,750

 

$

18,681

 

$

(5,931

)

 

(32

)%

 

 

 

 

 

 

 

 

Sulfur (long tons)

 

219

 

 

349

 

 

(130

)

 

(37

)%

Fertilizer (long tons)

 

179

 

 

165

 

 

14

 

 

8

%

Total sulfur services volumes (long tons)

 

398

 

 

514

 

 

(116

)

 

(23

)%

Natural Gas Liquids Segment

 

Comparative Results of Operations for the Three Months Ended June 30, 2021 and 2020

 

 

Three Months Ended

June 30,

 

Variance

 

Percent

Change

 

2021

 

2020

 

 

 

(In thousands)

 

 

Products Revenues

$

67,232

 

$

30,300

 

$

36,932

 

 

122

%

Cost of products sold

 

64,176

 

 

26,579

 

 

37,597

 

 

141

%

Operating expenses

 

1,061

 

 

1,150

 

 

(89

)

 

(8

)%

Selling, general and administrative expenses

 

697

 

 

930

 

 

(233

)

 

(25

)%

Depreciation and amortization

 

588

 

 

612

 

 

(24

)

 

(4

)%

 

 

710

 

 

1,029

 

 

(319

)

 

(31

)%

Other operating income, net

 

1

 

 

 

 

1

 

 

 

Operating income

$

711

 

$

1,029

 

$

(318

)

 

(31

)%

 

 

 

 

 

 

 

 

NGL sales volumes (Bbls)

 

1,259

 

 

1,698

 

 

(439

)

 

(26

)%

Comparative Results of Operations for the Six Months Ended June 30, 2021 and 2020

 

 

Six Months Ended

June 30,

 

Variance

 

Percent

Change

 

2021

 

2020

 

 

 

(In thousands)

 

 

Products Revenues

$

165,317

 

 

$

112,515

 

 

$

52,802

 

 

47

%

Cost of products sold

 

146,688

 

 

 

100,839

 

 

 

45,849

 

 

45

%

Operating expenses

 

2,056

 

 

 

2,089

 

 

 

(33

)

 

(2

)%

Selling, general and administrative expenses

 

2,904

 

 

 

2,077

 

 

 

827

 

 

40

%

Depreciation and amortization

 

1,199

 

 

 

1,221

 

 

 

(22

)

 

(2

)%

 

 

12,470

 

 

 

6,289

 

 

 

6,181

 

 

98

%

Other operating loss, net

 

(689

)

 

 

(2

)

 

 

(687

)

 

(34,350

)%

Operating income

$

11,781

 

 

$

6,287

 

 

$

5,494

 

 

87

%

 

 

 

 

 

 

 

 

NGL sales volumes (Bbls)

 

3,404

 

 

 

4,143

 

 

 

(739

)

 

(18

)%

Unallocated Selling, General and Administrative Expenses

 

Comparative Results of Operations for the Three and Six Months Ended June 30, 2021 and 2020

 

 

Three Months Ended

June 30,

 

Variance

 

Percent

Change

 

Six Months Ended

June 30,

 

Variance

 

Percent

Change

 

2021

 

2020

 

 

 

2021

 

2020

 

 

 

(In thousands)

 

 

 

(In thousands)

 

 

Unallocated selling, general and administrative expenses

$

3,780

 

$

4,361

 

$

(581

)

 

(13

)%

 

$

7,699

 

$

8,733

 

$

(1,034

)

 

(12

)%

Non-GAAP Financial Measures

The following table reconciles the non-GAAP financial measurements used by management to our most directly comparable GAAP measures for the six months ended June 30, 2021 and 2020.

Reconciliation of EBITDA, Adjusted EBITDA, Distributable Cash Flow and Adjusted Free Cash Flow

 

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

2021

 

2020

 

2021

 

2020

 

(in thousands)

 

(in thousands)

Net income (loss)

$

(6,612

)

 

$

(2,203

)

 

$

(4,101

)

 

$

6,612

 

Adjustments:

 

 

 

 

 

 

 

Interest expense, net

 

13,309

 

 

 

9,377

 

 

 

26,262

 

 

 

19,302

 

Income tax expense

 

935

 

 

 

790

 

 

 

1,157

 

 

 

1,137

 

Depreciation and amortization

 

14,483

 

 

 

15,343

 

 

 

28,917

 

 

 

30,582

 

EBITDA

 

22,115

 

 

 

23,307

 

 

 

52,235

 

 

 

57,633

 

Adjustments:

 

 

 

 

 

 

 

(Gain) loss on sale of property, plant and equipment, net

 

(89

)

 

 

(15

)

 

 

671

 

 

 

175

 

Unrealized mark-to-market on commodity derivatives

 

424

 

 

 

 

 

 

205

 

 

 

(669

)

Lower of cost or market adjustments

 

 

 

 

 

 

 

 

 

 

335

 

Gain on repurchase of senior unsecured notes

 

 

 

 

 

 

 

 

 

 

(3,484

)

Unit-based compensation

 

48

 

 

 

363

 

 

 

288

 

 

 

709

 

Adjusted EBITDA

 

22,498

 

 

 

23,905

 

 

 

53,399

 

 

 

54,949

 

Adjustments:

 

 

 

 

 

 

 

Interest expense, net

 

(13,309

)

 

 

(9,377

)

 

 

(26,262

)

 

 

(19,302

)

Income tax expense

 

(935

)

 

 

(790

)

 

 

(1,157

)

 

 

(1,137

)

Amortization of debt premium

 

 

 

 

(76

)

 

 

 

 

 

(153

)

Amortization of deferred debt issuance costs

 

766

 

 

 

499

 

 

 

1,521

 

 

 

991

 

Deferred income tax expense

 

683

 

 

 

732

 

 

 

758

 

 

 

1,018

 

Payments for plant turnaround costs

 

(20

)

 

 

(81

)

 

 

(1,694

)

 

 

(231

)

Maintenance capital expenditures

 

(2,370

)

 

 

(2,280

)

 

 

(6,441

)

 

 

(5,306

)

Distributable Cash Flow

$

7,313

 

 

$

12,532

 

 

$

20,124

 

 

$

30,829

 

Adjustments:

 

 

 

 

 

 

 

Expansion capital expenditures

$

(1,147

)

 

$

(2,585

)

 

$

(1,977

)

 

$

(7,931

)

Principal payments under finance lease obligations

 

(160

)

 

 

(1,358

)

 

 

(2,591

)

 

 

(3,222

)

Adjusted Free Cash Flow

$

6,006

 

 

$

8,589

 

 

$

15,556

 

 

$

19,676

 

 

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