Exhibit 99.1
MARTIN MIDSTREAM PARTNERS REPORTS
2009 FOURTH QUARTER AND ANNUAL FINANCIAL RESULTS
2009 FOURTH QUARTER AND ANNUAL FINANCIAL RESULTS
KILGORE, Texas, March 4, 2010/Globe Newswire/ — Martin Midstream Partners L.P. (Nasdaq: MMLP) announced today its financial results for the fourth quarter and year ended December 31, 2009.
MMLP reported net income for the fourth quarter of 2009 of $2.0 million, or $0.15 per limited partner unit. This compared to net income for the fourth quarter of 2008 of $17.0 million, or $1.08 per limited partner unit. Revenues for the fourth quarter of 2009 were $200.9 million compared to $236.1 million for the fourth quarter of 2008. Fourth quarter 2009 net income was negatively impacted by a $0.2 million, or $0.01 per limited partner unit, non-cash derivatives loss from certain commodity and interest rate hedges that did not qualify for hedge accounting. Fourth quarter 2008 net income was positively impacted by a $0.8 million, or $0.06 per limited partner unit, non-cash derivatives gain from certain commodity and interest rate hedges that did not qualify for hedge accounting.
MMLP reported net income for the year ended December 31, 2009 of $22.2 million, or $1.17 per limited partner unit. This compared to net income for the year ended December 31, 2008 of $43.6 million, or $2.72 per limited partner unit. Revenues for the year ended December 31, 2009 were $662.3 million, compared to revenues of $1.2 billion for the year ended December 31, 2008. Net income for the year ended December 31, 2009 was negatively impacted by $2.5 million, or $0.15 per limited partner unit, of non-cash derivatives losses from certain commodity and interest rate hedges that did not qualify for hedge accounting. Net income for the year ended December 31, 2009 was positively impacted by $6.0 million, or $0.41 per limited partner unit, of gains from the sale of property, plant and equipment ($5.0 million) and on the involuntary conversion of property, plant and equipment ($1.0 million) resulting from Hurricanes Gustav and Ike. Net income for the year ended December 31, 2008 was positively impacted by $2.3 million, or $0.16 per limited partner unit, of non-cash derivatives gains from certain commodity and interest rate hedges that did not qualify for hedge accounting. Additionally net income for the year ended December 31, 2008 was negatively impacted by $1.5 million, or $0.10 per limited partner unit, from losses in excess of insurance reimbursements resulting from Hurricanes Gustav and Ike.
The Partnership’s distributable cash flow for the three months ended December 31, 2009 was $10.3 million and for the year ended December 31, 2009 was $55.7 million. Distributable cash flow is a non-GAAP financial measure which is explained in greater detail below under “Use of Non-GAAP Financial Information.” The Partnership has also included below a table entitled “Distributable Cash Flow” in order to show the components of this non-GAAP financial measure and its reconciliation to the most comparable GAAP measurement.
Due to FASB ASC 850, the Partnership is required to account for the Cross Oil asset contribution as a transfer of net assets between entities under common control. As such, the revenues, earnings and distributable cash flow data set forth above and elsewhere herein require adjustment to be viewed on a comparable year over year basis. Before giving effect to the Cross transaction, revenue for the year ended December 31, 2009 would have been $633.8 million, compared to revenues of $1.2 billion for the year ended December 31, 2008. Additionally, net income for the year ended December 31, 2009 would have been $20.5 million compared to net income of $42.8 million for the year ended December 31, 2008. Finally, distributable cash flow for the year ended December 31, 2009 would have been $49.4 million. For a more detailed reconciliation of the Cross asset acquisition, please refer toItem 6. Selected Financial Datain our Form 10-K filed with the SEC on March 4, 2010.
Included with this press release are MMLP’s consolidated financial statements as of and for the quarter and year ended December 31, 2009 and certain prior periods. These financial statements
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should be read in conjunction with the information contained in the Partnership’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 4, 2010.
Ruben Martin, President and Chief Executive Officer of Martin Midstream GP LLC, the general partner of Martin Midstream Partners, said “For the year ended 2009, we are pleased with the Partnership’s operational results and our position for continued future growth. Our distributable cash flow was $49.4 million, before giving effect to the Cross transaction, giving us a distribution coverage ratio of 1.04 times. Although we strive for higher coverage, this level was acceptable due to the diverse nature of our operating segments. Our marine transportation and natural gas services segments both experienced softness throughout most of the year. In contrast, our sulfur services division showed strong performance, specifically from its fertilizer business. Finally, our largest segment, terminalling and storage, generated its usual steady and consistent cash flow.
Last November, we completed the acquisition of the Cross lube processing assets from the owner of our General Partner, Martin Resource Management Corp. With that transaction, your partnership added approximately $10-$12 million of fee-based cash flow to its terminalling and storage segment. This significant enhancement to the Partnership follows our strategic plan to grow our fee-based cash flow. With the addition of Cross, we estimate that approximately 65% of our 2010 cash flow will come from fee-based contracts. This supports our continued ability to pay distributions to our unitholders. Also in the fourth quarter, we sold $20 million in common units to our Martin Resource Management. This important equity infusion not only provided additional liquidity, it also assisted the Partnership in the successfully refinancing and upsizing of its credit facilities to $336.4 million.
Looking ahead, I am pleased to report that the Partnership’s liquidity position is substantially improved from where we were one year ago. Further, thus far in 2010, we have issued additional common units raising approximately $51.7 million in net proceeds and increased our credit facilities to $350.0 million. Our improved liquidity and strengthened balance sheet better position the Partnership for strategic growth. Looking ahead, we are excited about the opportunities that an improved balance sheet will provide. This includes the development of new organic growth projects and potential acquisitions.”
Investors’ Conference Call
An investor’s conference call to review the fourth quarter and year end results will be held on Friday, March 5, 2010, at 8:00 a.m. Central Time. The conference call can be accessed by calling (877) 878-2695. An audio replay of the conference call will be available by calling (800) 642-1687 from 10:30 a.m. Central Time on March 5, 2010 through 11:59 p.m. Central Time on March 12, 2010. The access codes for the conference call and the audio replay are as follows: Conference ID No. 59938853. The audio replay of the conference call will also be archived on the Partnership’s website at www.martinmidstream.com.
About Martin Midstream Partners
Martin Midstream Partners 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: terminalling and storage services for petroleum products and by-products; natural gas gathering, processing and NGL distribution; sulfur and sulfur-based products processing, manufacturing, and distribution; and marine transportation services for petroleum products and by-products.
Additional information concerning the Partnership is available on the Partnership’s website at www.martinmidstream.com.
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Forward-Looking Statements
Statements about Martin Midstream Partners’ 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 and other factors, many of which are outside its control, which could cause actual results to differ materially from such statements. While MMLP 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. Martin Midstream Partners 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.
Use of Non-GAAP Financial Information
MMLP reports its financial results in accordance with United States generally accepted accounting principles (GAAP). However, from time to time, MMLP uses certain non-GAAP financial measures such as distributable cash flow because MMLP’s management believes that this measure may provide users of this financial information with meaningful comparisons between current results and prior reported results and a meaningful measure of MMLP’s cash available to pay distributions. Distributable cash flow should not be considered an alternative to cash flow from operating activities or any other measure of financial performance in accordance with GAAP in the United States. Distributable cash flow is not intended to represent cash flows for the period, nor is it presented as an alternative to income from continuing operations. Furthermore, it should not be seen as a measure of liquidity or a substitute for comparable metrics prepared in accordance with GAAP. This information may constitute non-GAAP financial measures within the meaning of Regulation G adopted by the Securities and Exchange Commission. Accordingly, MMLP has presented herein, and will present in other information it publishes that contains this non-GAAP financial measure, a reconciliation of this measure to the most directly comparable GAAP financial measure.
The Partnership has included below a table entitled “Distributable Cash Flow” in order to show the components of this non-GAAP financial measure and its reconciliation to the most comparable GAAP measure. MMLP calculates distributable cash flow as follows: net income (as reported in statements of operations), plus depreciation and amortization and amortization of deferred debt issue costs (as reported in statements of cash flows), less deferred income taxes (as reported in statements of cash flows), plus distribution equivalents from unconsolidated entities (as described below), plus invested cash in unconsolidated entities (as described below), less equity in earnings of unconsolidated entities (as reported in statements of operations), less non-cash mark-to-market on derivatives (as reported in statements of cash flows, less maintenance capital expenditures (as reported under the caption “Liquidity and Capital Resources” in MMLP’s Annual Report on Form 10-K filed with the SEC on March 4, 2010), less gain on disposition or sale of property, plant and equipment (as reported in statements of cash flows), less gain on involuntary conversion of property, plant and equipment (as reported in statements of cash flows), plus (less) unit-based compensation (as reported in statements of changes in capital).
MMLP’sdistribution equivalents from unconsolidated entitiesis calculated as distributions from unconsolidated entities (as reported in statements of cash flows), plus return of investments from unconsolidated entities (as reported in statements of cash flows), plus distributions in-kind from unconsolidated entities (as reported in statements of cash flows).
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MMLP’sinvested cash in unconsolidated entitiesis calculated as distributions from (contributions to) unconsolidated entities for operations (as reported in statements of cash flows), plus expansion capital expenditures in unconsolidated entities (as reported under the caption “Liquidity and Capital Resources” in MMLP’s Annual Report on Form 10-K filed with the SEC on March 4, 2010).
Contacts:Robert D. Bondurant, Executive Vice President and Chief Financial Officer of Martin Midstream GP LLC, the Partnership’s general partner at (903) 983-6200.
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS
| �� | December 31, | |||||||
| 2009 | 20081 | |||||||
| (Dollars in thousands) | ||||||||
Assets | ||||||||
| Cash | $ | 5,956 | $ | 7,983 | ||||
| Accounts and other receivables, less allowance for doubtful accounts of $1,025 and $481, respectively | 77,413 | 68,168 | ||||||
| Product exchange receivables | 4,132 | 6,924 | ||||||
| Inventories | 35,510 | 42,754 | ||||||
| Due from affiliates | 3,051 | 555 | ||||||
| Fair value of derivatives | 1,872 | 3,623 | ||||||
| Other current assets | 1,340 | 3,418 | ||||||
| Total current assets | 129,274 | 133,425 | ||||||
| Property, plant and equipment, at cost | 584,036 | 576,608 | ||||||
| Accumulated depreciation | (162,121 | ) | (130,976 | ) | ||||
| Property, plant and equipment, net | 421,915 | 445,632 | ||||||
| Goodwill | 37,268 | 37,405 | ||||||
| Investment in unconsolidated entities | 80,582 | 79,843 | ||||||
| Fair value of derivatives | — | 1,469 | ||||||
| Other assets, net | 16,900 | 8,548 | ||||||
| $ | 685,939 | $ | 706,322 | |||||
Liabilities and Partners’ Capital | ||||||||
| Current installments of lease obligations | $ | 111 | $ | — | ||||
| Trade and other accounts payable | 71,911 | 94,146 | ||||||
| Product exchange payables | 7,986 | 10,924 | ||||||
| Due to affiliates | 13,810 | 23,085 | ||||||
| Income taxes payable | 454 | 414 | ||||||
| Fair value of derivatives | 7,227 | 6,478 | ||||||
| Other accrued liabilities | 5,000 | 6,428 | ||||||
| Total current liabilities | 106,499 | 141,475 | ||||||
| Long-term debt and capital leases, less current maturities | 304,372 | 295,000 | ||||||
| Deferred income taxes | 8,628 | 17,499 | ||||||
| Fair value of derivatives | — | 4,302 | ||||||
| Other long-term obligations | 1,489 | 1,667 | ||||||
| Total liabilities | 420,988 | 459,943 | ||||||
| Partners’ capital | 267,027 | 251,314 | ||||||
| Accumulated other comprehensive loss | (2,076 | ) | (4,935 | ) | ||||
| Total partners’ capital | 264,951 | 246,379 | ||||||
| Commitments and contingencies | ||||||||
| $ | 685,939 | $ | 706,322 | |||||
| 1 | Financial information for 2008 has been revised to include balances attributable to the Cross assets acquired in November 2009. |
These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in MMLP’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 4, 2010.
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
CONSOLIDATED STATEMENTS OF OPERATIONS
| Year Ended December 31, | ||||||||||||
| 20091 | 20081 | 20071 | ||||||||||
| (Dollars in thousands, except per unit amounts) | ||||||||||||
| Terminalling and storage * | $ | 69,710 | $ | 68,552 | $ | 67,905 | ||||||
| Marine transportation * | 68,480 | 76,349 | 59,579 | |||||||||
| Product sales: * | ||||||||||||
| Natural gas services | 408,982 | 679,375 | 515,992 | |||||||||
| Sulfur services | 79,629 | 371,949 | 131,326 | |||||||||
| Terminalling and storage | 35,584 | 50,219 | 29,525 | |||||||||
| 524,195 | 1,101,543 | 676,843 | ||||||||||
| Total revenues | 662,385 | 1,246,444 | 804,327 | |||||||||
| Costs and expenses: | ||||||||||||
| Cost of products sold: (excluding depreciation and amortization) | ||||||||||||
| Natural gas services * | 382,542 | 657,662 | 495,641 | |||||||||
| Sulfur services * | 43,386 | 313,143 | 97,577 | |||||||||
| Terminalling and storage | 31,331 | 42,721 | 25,471 | |||||||||
| 457,259 | 1,013,526 | 618,689 | ||||||||||
| Expenses: | ||||||||||||
| Operating expenses * | 117,438 | 126,808 | 104,165 | |||||||||
| Selling, general and administrative * | 19,775 | 19,062 | 13,918 | |||||||||
| Depreciation and amortization | 39,506 | 34,893 | 26,323 | |||||||||
| Total costs and expenses | 633,978 | 1,194,289 | 763,095 | |||||||||
| Other operating income | 6,013 | 209 | 703 | |||||||||
| Operating income | 34,420 | 52,364 | 41,935 | |||||||||
| Other income (expense): | ||||||||||||
| Equity in earnings of unconsolidated entities | 7,044 | 13,224 | 10,941 | |||||||||
| Interest expense | (18,995 | ) | (21,433 | ) | (15,125 | ) | ||||||
| Other, net | 326 | 801 | 405 | |||||||||
| Total other income (expense) | (11,625 | ) | (7,408 | ) | (3,779 | ) | ||||||
| Net income before taxes | 22,795 | 44,956 | 38,156 | |||||||||
| Income tax benefit (expense) | (592 | ) | (1,398 | ) | (5,595 | ) | ||||||
| Net income | $ | 22,203 | $ | 43,558 | $ | 32,561 | ||||||
General partner’s interest in net income2 | $ | 3,249 | $ | 3,301 | $ | 1,564 | ||||||
Limited partners’ interest in net income2 | $ | 17,179 | $ | 39,509 | $ | 23,375 | ||||||
| Net income per limited partner unit — basic and diluted | $ | 1.17 | $ | 2.72 | $ | 1.67 | ||||||
| Weighted average limited partner units — basic | 14,680,807 | 14,529,826 | 14,018,799 | |||||||||
| Weighted average limited partner units — diluted | 14,684,775 | 14,534,722 | 14,022,545 | |||||||||
| 1 | Financial information for 2007, 2008 and for the period January 1, 2009 through November 24, 2009 has been revised to include results attributable to the Cross assets acquired in November 2009. | |
| 2 | General and limited partner’s interest in net income includes net income attributable to the Cross assets since the date of the acquisition noted above. |
These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in MMLP’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 4, 2010.
| * | Related Party Transactions Included Above |
| Revenues: | ||||||||||||
| Terminalling and storage | $ | 19,998 | $ | 18,362 | $ | 11,816 | ||||||
| Marine transportation | 19,370 | 24,956 | 23,729 | |||||||||
| Product Sales | 5,838 | 26,704 | 7,577 | |||||||||
| Costs and expenses: | ||||||||||||
| Cost of products sold: (excluding depreciation and amortization) | ||||||||||||
| Natural gas services | 56,914 | 92,322 | 62,686 | |||||||||
| Sulfur services | 12,583 | 13,282 | 13,992 | |||||||||
| Expenses: | ||||||||||||
| Operating expenses | 37,284 | 37,661 | 28,991 | |||||||||
| Selling, general and administrative | 7,162 | 6,284 | 4,089 |
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL
For the years ended December 31, 20091, 20081 and 20071
CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL
For the years ended December 31, 20091, 20081 and 20071
| Partners’ Capital | Accumulated | |||||||||||||||||||||||||||||||
| General | Comprehensive | |||||||||||||||||||||||||||||||
| Parent Net | Common | Subordinated | Partner | Income | ||||||||||||||||||||||||||||
| Investment1 | Units | Amount | Units | Amount | Amount | Amount | Total | |||||||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||||||||||||||
Balances – December 31, 2006 | $ | 3,295 | 10,603,808 | $ | 201,426 | 2,552,018 | $ | (6,224 | ) | $ | 3,201 | $ | 122 | $ | 201,820 | |||||||||||||||||
| Net Income | 7,622 | — | 19,781 | — | 3,594 | 1,564 | — | 32,561 | ||||||||||||||||||||||||
| Follow-on public offering | — | 1,380,000 | 55,933 | — | — | — | — | 55,933 | ||||||||||||||||||||||||
| General partner contribution | — | — | — | — | — | 1,192 | — | 1,192 | ||||||||||||||||||||||||
| Conversion of subordinated units to common units | — | 850,672 | (3,243 | ) | (850,672 | ) | 3,243 | — | — | — | ||||||||||||||||||||||
| Unit-based compensation | — | 3,000 | 46 | — | — | — | — | 46 | ||||||||||||||||||||||||
| Cash distributions ($2.60 per unit) | — | — | (29,423 | ) | — | (6,635 | ) | (1,845 | ) | — | (37,903 | ) | ||||||||||||||||||||
| Commodity hedging gains reclassified to earnings | — | — | — | — | — | — | 478 | 478 | ||||||||||||||||||||||||
| Adjustment in fair value of derivatives | — | — | — | — | — | — | (7,362 | ) | (7,362 | ) | ||||||||||||||||||||||
Balances – December 31, 2007 | $ | 10,917 | 12,837,480 | $ | 244,520 | 1,701,346 | $ | (6,022 | ) | $ | 4,112 | $ | (6,762 | ) | $ | 246,765 | ||||||||||||||||
| Net Income | 748 | — | 34,978 | — | 4,531 | 3,301 | — | 43,558 | ||||||||||||||||||||||||
| Cash distributions ($2.91 per unit) | — | — | (37,357 | ) | — | (4,951 | ) | (3,409 | ) | — | (45,717 | ) | ||||||||||||||||||||
| Conversion of subordinated units to common units | — | 850,672 | (2,754 | ) | (850,672 | ) | 2,754 | — | — | — | ||||||||||||||||||||||
| Unit-based compensation | — | 3,000 | 39 | — | — | — | — | 39 | ||||||||||||||||||||||||
| Purchase of treasury units | — | (3,000 | ) | (93 | ) | — | — | — | — | (93 | ) | |||||||||||||||||||||
| Adjustment in fair value of derivatives | — | — | — | — | — | — | 1,827 | 1,827 | ||||||||||||||||||||||||
Balances – December 31, 2008 | $ | 11,665 | 13,688,152 | $ | 239,333 | 850,674 | $ | (3,688 | ) | $ | 4,004 | $ | (4,935 | ) | $ | 246,379 | ||||||||||||||||
| Net Income | 1,664 | — | 16,310 | — | 980 | 3,249 | — | 22,203 | ||||||||||||||||||||||||
| General partner contribution | — | — | — | — | — | 1,324 | — | 1,324 | ||||||||||||||||||||||||
| Units issued in connection with Cross acquisition | 804,721 | 16,523 | 889,444 | 16,434 | — | — | 32,957 | |||||||||||||||||||||||||
| Recognition of beneficial conversion feature | — | — | (111 | ) | — | 111 | — | — | — | |||||||||||||||||||||||
| Issuance of common units | — | 714,285 | 20,000 | — | — | — | — | 20,000 | ||||||||||||||||||||||||
| Cash distributions ($3.00 per unit) | — | — | (41,064 | ) | — | (2,552 | ) | (3,846 | ) | — | (47,462 | ) | ||||||||||||||||||||
| Conversion of subordinated units to common units | — | 850,674 | (5,328 | ) | (850,674 | ) | 5,328 | — | — | — | ||||||||||||||||||||||
| Unit-based compensation | — | 3,000 | 98 | — | — | — | — | 98 | ||||||||||||||||||||||||
| Purchase of treasury units | — | (3,000 | ) | (78 | ) | — | — | — | — | (78 | ) | |||||||||||||||||||||
| Distributions to parent | (13,329 | ) | — | — | — | — | — | — | (13,329 | ) | ||||||||||||||||||||||
| Adjustment in fair value of derivatives | — | — | — | — | — | — | 2,859 | 2,859 | ||||||||||||||||||||||||
Balances – December 31, 2009 | $ | — | 16,057,832 | $ | 245,683 | 889,444 | $ | 16,613 | $ | 4,731 | $ | (2,076 | ) | $ | 264,951 | |||||||||||||||||
| 1 | Financial information for 2007, 2008 and for the period January 1, 2009 through November 24, 2009 has been revised to include results attributable to the Cross assets acquired in November 2009. |
These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in MMLP’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 4, 2010.
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in thousands)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in thousands)
| Year Ended December 31, | ||||||||||||
| 20091 | 20081 | 20071 | ||||||||||
| (Dollars in thousands) | ||||||||||||
| Net income | $ | 22,203 | $ | 43,558 | $ | 32,561 | ||||||
| Changes in fair values of commodity cash flow hedges | 14 | 4,219 | (3,569 | ) | ||||||||
| Commodity cash flow hedging (gains) losses reclassified to earnings | (2,646 | ) | 3,043 | 478 | ||||||||
| Changes in fair value of interest rate cash flow hedges | (1,854 | ) | (5,435 | ) | (3,793 | ) | ||||||
| Interest rate cash flow hedging losses reclassified to earnings | 7,345 | — | — | |||||||||
| Comprehensive income | $ | 25,062 | $ | 45,385 | $ | 25,677 | ||||||
| 1 | Financial information for 2007, 2008 and for the period January 1, 2009 through November 24, 2009 has been revised to include results attributable to the Cross assets acquired in November 2009. |
These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in MMLP’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 4, 2010.
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Year Ended December 31, | ||||||||||||
| 20091 | 20081 | 20071 | ||||||||||
| (Dollars in thousands) | ||||||||||||
| Cash flows from operating activities: | ||||||||||||
| Net income | $ | 22,203 | $ | 43,558 | $ | 32,561 | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
| Depreciation and amortization | 39,506 | 34,895 | 26,322 | |||||||||
| Amortization of deferred debt issue costs | 1,689 | 1,120 | 1,233 | |||||||||
| Deferred income taxes | 294 | 2,442 | 680 | |||||||||
| Gain on disposition or sale of property, plant, and equipment | (4,996 | ) | (131 | ) | (484 | ) | ||||||
| Gain on involuntary conversion of property, plant, and equipment | (1,017 | ) | (65 | ) | — | |||||||
| Equity in earnings of unconsolidated entities | (7,044 | ) | (13,224 | ) | (10,941 | ) | ||||||
| Distributions from unconsolidated entities | 650 | 500 | 1,523 | |||||||||
| Distribution in-kind from unconsolidated entities | 5,826 | 9,725 | 9,337 | |||||||||
| Non-cash mark-to-market on derivatives | 2,526 | (2,327 | ) | 3,904 | ||||||||
| Other | 98 | 39 | 47 | |||||||||
| Change in current assets and liabilities, excluding effects of acquisitions and dispositions: | ||||||||||||
| Accounts and other receivables | (10,471 | ) | 19,753 | (26,992 | ) | |||||||
| Product exchange receivables | 2,792 | 3,988 | (3,422 | ) | ||||||||
| Inventories | 7,135 | 9,398 | (18,651 | ) | ||||||||
| Due from affiliates | 1,560 | 1,770 | (995 | ) | ||||||||
| Other current assets | 2,461 | (992 | ) | (1,241 | ) | |||||||
| Trade and other accounts payable | (15,874 | ) | (14,904 | ) | 46,119 | |||||||
| Product exchange payables | (2,938 | ) | (13,629 | ) | 9,817 | |||||||
| Due to affiliates | 4,133 | 5,966 | (5,583 | ) | ||||||||
| Income taxes payable | 569 | (453 | ) | (1,225 | ) | |||||||
| Other accrued liabilities | 871 | 101 | 793 | |||||||||
| Change in other non-current assets and liabilities | (2,381 | ) | (1,190 | ) | (1,593 | ) | ||||||
| Net cash provided by operating activities | 47,592 | 86,340 | 61,209 | |||||||||
| Cash flows from investing activities: | ||||||||||||
| Payments for property, plant, and equipment | (35,846 | ) | (101,450 | ) | (85,359 | ) | ||||||
| Acquisitions, net of cash acquired | (327 | ) | (5,983 | ) | (41,271 | ) | ||||||
| Proceeds from sale of property, plant, and equipment | 19,445 | 463 | 1,293 | |||||||||
| Insurance proceeds from involuntary conversion of property, plant and equipment | 2,224 | 1,503 | — | |||||||||
| Return of investments from unconsolidated entities | 877 | 1,225 | 1,952 | |||||||||
| Distributions from (contributions to) unconsolidated entities for operations | (1,048 | ) | (2,379 | ) | (6,910 | ) | ||||||
| Net cash used in investing activities | (14,675 | ) | (106,621 | ) | (130,295 | ) | ||||||
| Cash flows from financing activities: | ||||||||||||
| Payments of long-term debt | (431,982 | ) | (257,191 | ) | (169,024 | ) | ||||||
| Proceeds from long-term debt | 433,700 | 327,170 | 219,950 | |||||||||
| Net proceeds from follow on public offering | — | — | 55,933 | |||||||||
| General partner contribution | 1,324 | — | 1,192 | |||||||||
| Purchase of treasury units | (78 | ) | (93 | ) | — | |||||||
| Proceeds from issuance of common units | 20,000 | — | — | |||||||||
| Payments of debt issuance costs | (10,446 | ) | (18 | ) | (252 | ) | ||||||
| Cash distributions paid | (47,462 | ) | (45,717 | ) | (37,903 | ) | ||||||
| Net cash provided by (used in) financing activities | (34,944 | ) | 24,151 | 69,896 | ||||||||
| Net increase(decrease) in cash | (2,027 | ) | 3,870 | 810 | ||||||||
| Cash at beginning of period | 7,983 | 4,113 | 3,303 | |||||||||
| Cash at end of period | $ | 5,956 | $ | 7,983 | $ | 4,113 | ||||||
| Supplemental schedule of non-cash investing and financing activities: | ||||||||||||
| Purchase of assets under capital lease obligations | $ | 7,764 | $ | — | $ | — | ||||||
| Issuance of common and subordinated units in connection with Cross acquisition | $ | 32,957 | $ | — | $ | — | ||||||
| 1 | Financial information for 2007, 2008 and for the period January 1, 2009 through November 24, 2009 has been revised to include results attributable to the Cross assets acquired in November 2009. |
These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in MMLP’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 4, 2010.
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
CONSOLIDATED STATEMENTS OF OPERATIONS
| 4th Quarter | 4th Quarter | |||||||
| 20091 | 20081 | |||||||
| (Dollars in thousands, except | ||||||||
| per unit amounts) | ||||||||
| (Unaudited) | ||||||||
| Revenues: | ||||||||
| Terminalling and storage | $ | 16,039 | $ | 17,407 | ||||
| Marine transportation | 19,258 | 20,521 | ||||||
| Product sales: | ||||||||
| Natural gas services | 140,233 | 102,058 | ||||||
| Sulfur | 18,600 | 82,421 | ||||||
| Terminalling and storage | 6,731 | 13,693 | ||||||
| 165,564 | 198,172 | |||||||
| Total revenues | 200,861 | 236,100 | ||||||
| Costs and expenses: | ||||||||
| Cost of products sold: | ||||||||
| Natural gas services | 133,849 | 95,492 | ||||||
| Sulfur | 8,644 | 59,680 | ||||||
| Terminalling and storage | 5,773 | 11,500 | ||||||
| 148,266 | 166,672 | |||||||
| Expenses: | ||||||||
| Operating expenses | 32,790 | 31,379 | ||||||
| Selling, general and administrative | 6,023 | 6,944 | ||||||
| Depreciation and amortization | 10,250 | 9,580 | ||||||
| Total costs and expenses | 197,329 | 214,575 | ||||||
| Other operating income (loss) | 962 | 66 | ||||||
| Operating income | 4,494 | 21,591 | ||||||
| Other income (expense): | ||||||||
| Equity in earnings of unconsolidated entities | 1,817 | 1,839 | ||||||
| Interest expense | (5,408 | ) | (6,416 | ) | ||||
| Other, net | (19 | ) | 323 | |||||
| Total other income (expense) | (3,612 | ) | (4,252 | ) | ||||
| Income tax expense (benefit) | (1,072 | ) | 309 | |||||
| Net income | $ | 1,956 | $ | 17,028 | ||||
| General partner’s interest in net income | $ | 774 | $ | 1,044 | ||||
| Limited partners’ interest in net income | $ | 2,342 | $ | 15,685 | ||||
| Net income per limited partner unit — basic and diluted. | $ | 0.15 | $ | 1.08 | ||||
| Weighted average limited partner units | 15,149,731 | 14,538,826 | ||||||
| 1 | Financial information for 2007, 2008 and for the period January 1, 2009 through November 24, 2009 has been revised to include results attributable to the Cross assets acquired in November 2009. | |
| 2 | General and limited partner’s interest in net income includes net income of the Cross assets since the date of the acquisition. |
These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in MMLP’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 4, 2010.
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DISTRIBUTABLE CASH FLOW
(Dollars in thousands)
(Unaudited Non-GAAP Financial Measure)
(Dollars in thousands)
(Unaudited Non-GAAP Financial Measure)
| Three Months Ended | Year Ended | |||||||||||||||||||||||
| December 31, 20094 | December 31, 20094 | |||||||||||||||||||||||
| Historical | Historical | |||||||||||||||||||||||
| Martin | Martin | |||||||||||||||||||||||
| Midstream | Cross Assets | Midstream | Cross Assets | |||||||||||||||||||||
| Partners LP | Results | Revised Total | Partners LP | Results | Revised Total | |||||||||||||||||||
| Net income | $ | 3,227 | $ | (1,271 | ) | $ | 1,956 | $ | 20,539 | $ | 1,664 | $ | 22,203 | |||||||||||
| Adjustments to reconcile net income to distributable cash flow: | ||||||||||||||||||||||||
| Depreciation and amortization | 9,486 | 764 | 10,250 | 35,143 | 4,363 | 39,506 | ||||||||||||||||||
| Amortization of deferred debt issue costs | 847 | — | 847 | 1,689 | — | 1,689 | ||||||||||||||||||
| Deferred income taxes | 20 | (1,543 | ) | (1,523 | ) | 90 | 204 | 294 | ||||||||||||||||
Distribution equivalents from unconsolidated entities1 | 2,053 | — | 2,053 | 7,353 | — | 7,353 | ||||||||||||||||||
Invested cash in unconsolidated entities2 | 210 | — | 210 | 2,712 | — | 2,712 | ||||||||||||||||||
| Equity in earnings of unconsolidated entities | (1,817 | ) | — | (1,817 | ) | (7,044 | ) | — | (7,044 | ) | ||||||||||||||
| Non-cash mark-to-market on derivatives | 194 | — | 194 | 2,526 | — | 2,526 | ||||||||||||||||||
Maintenance capital expenditures3 | (849 | ) | (62 | ) | (911 | ) | (7,531 | ) | (69 | ) | (7,600 | ) | ||||||||||||
| Gain on disposition or sale of property, plant and equipment | 55 | — | 55 | (5,143 | ) | 147 | (4,996 | ) | ||||||||||||||||
| Gain on involuntary conversion of property, plant and equipment | (1,017 | ) | — | (1,017 | ) | (1,017 | ) | — | (1,017 | ) | ||||||||||||||
| Unit based compensation | 39 | — | 39 | 98 | — | 98 | ||||||||||||||||||
| Distributable cash flow | $ | 12,448 | $ | (2,112 | ) | $ | 10,336 | $ | 49,415 | $ | 6,309 | $ | 55,724 | |||||||||||
| Three Months | ||||||||
| Ended | Year Ended | |||||||
| December 31, | December 31, | |||||||
| 2009 | 2009 | |||||||
1Distribution equivalents from unconsolidated entities: | ||||||||
| Distributions from unconsolidated entities | $ | — | $ | 650 | ||||
| Return of investments from unconsolidated entities | 217 | 877 | ||||||
| Distributions in-kind from unconsolidated entities | 1,836 | 5,826 | ||||||
| Distribution equivalents from unconsolidated entities | $ | 2,053 | $ | 7,353 | ||||
2Invested cash in unconsolidated entities:: | ||||||||
| Distributions from (contributions to) unconsolidated entities for operations | $ | (215 | ) | $ | (1,048 | ) | ||
| Expansion capital expenditures in unconsolidated entities | 425 | 3,760 | ||||||
| Invested cash in unconsolidated entities | $ | 210 | $ | 2,712 | ||||
| 3 | Maintenance capital expenditures exclude hurricane-related maintenance capital expenditures. | |
| 4 | Financial information for 2007, 2008 and for the period January 1, 2009 through November 24, 2009 has been revised to include results attributable to the Cross assets acquired by MMLP on November 24, 2009. |
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