Martin Midstream Partners (MMLP) 8-K Martin Midstream Partners Reports 2005 Fourth Quarter and Annual Financial Results

Exhibit 99.1

MARTIN MIDSTREAM PARTNERS REPORTS 2005 FOURTH QUARTER AND ANNUAL FINANCIAL RESULTS

     KILGORE, Texas, March 14, 2006 / PRNewswire-First Call via COMTEX/ — Martin Midstream Partners announced today its financial results for the fourth quarter and year ended December 31, 2005.

     MMLP reported net income for the fourth quarter ended December 31, 2005 of $2.6 million on revenues of $144.6 million compared to net income for the quarter ended December 31, 2004 of $4.4 million on revenues of $91.6 million. MMLP’s net income per limited partner unit for the fourth quarter of 2005 was $0.28 compared to net income per limited partner unit for the fourth quarter of 2004 of $0.51.

     MMLP reported net income for the year ended December 31, 2005 of $13.9 million on revenues of $438.4 million compared to net income for the year ended December 31, 2004 of $12.3 million on revenues of $294.1 million. MMLP’s net income per limited partner unit for the year ended December 31, 2005 was $1.58 compared to net income per limited partner unit for the year ended December 31, 2004 of $1.45.

     The Company’s distributable cash flow for the year ended December 31, 2005 was $21.1 million, or 1.11 times the actual cash distributed by MMLP to unitholders in 2005. The Company’s distributable cash flow for the year ended December 31, 2004 was $18.0 million, or 1.03 times the actual cash distributed by MMLP to unitholders in 2004. As a result of the growth in distributable cash flow, MMLP increased its 2005 quarterly distributions per limited partner unit from $0.535 paid in respect of the first quarter of 2005 to $0.61 paid in respect of the fourth quarter of 2005. Distributable cash flow is a non-GAAP financial measure which is explained in greater detail below under “Use of Non-GAAP Financial Information”.

     Fourth quarter 2005 results were negatively impacted by $0.09 per limited partner unit due to the down-time resulting from the conversion of one of MMLP’s offshore marine vessels and the conversion of tankage at its Tampa terminal to different product specifications. The Company anticipates that the conversion of these assets should result in higher levels of service at higher margins in 2006.

     Ruben Martin, President and Chief Executive Officer of Martin Midstream GP LLC, MMLP’s general partner, stated: “2005 has been a pivotal year for our company. Prism Gas, our largest acquisition to date, has been successfully integrated with our company and has provided us with immediate entry into the growing East Texas and North Louisiana natural gas gathering and processing business. Furthermore, the acquisition of Prism Gas has provided us with substantial organic growth opportunities at favorable rates of return in 2006 and beyond. We currently have $70 to $80 million in organic growth projects currently in progress, which we anticipate will come on line in 2006 and 2007. In addition to our growing natural gas/ LPG services segment, we have also experienced significant growth in our newly formed sulfur segment. With the acquisitions of Bay Sulfur and the remaining interest in CF Martin Sulphur during 2005, as well as the construction of a new sulfur processing facility at our Neches terminal, we have further developed our sulfur gathering, processing and distribution

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infrastructure. This expanded infrastructure gives us and our customers access to the world sulfur markets. We look forward to a full year of operations from Prism Gas and these new sulfur assets.”

     Included with this press release are MMLP’s Consolidated Balance Sheets as of December 31, 2005 and 2004, its Consolidated Statements of Operations for the years ended December 31, 2005, 2004 and 2003, its Consolidated Statements of Cash Flows for the years ended December 31, 2005, 2004 and 2003 and its Consolidated Statements of Operations for the quarters ended December 31, 2005 and 2004. These financial statements should be read in conjunction with the information contained in the Company’s Annual Report on Form 10-K, to be filed with the Securities and Exchange Commission.

Investors’ Conference Call

     An investors’ conference call to review the fourth quarter and year end results will be held on Wednesday, March 15, 2006, at 8:30 a.m. Central Time. The conference call can be accessed by calling (877) 407-9205. An audio replay of the conference call will be available by calling (877) 660-6853 from 10:00 a.m. Central Time on March 15, 2006 through 11:59 p.m. Central Time on March 22, 2006. The access codes for the conference call and the audio replay are as follows: Account No. 286; Conference ID No. 195687. The audio replay of the conference call will also be archived on the Company’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 LPG distribution; marine transportation services for petroleum products and by-products; sulfur gathering, processing and distribution; and fertilizer manufacturing and distribution.

     Additional information concerning the Company is available on the Company’s website at www.martinmidstream.com.

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 and anticipating or predicting certain important factors. A discussion of these factors, including risks and uncertainties, is set forth in the Company’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

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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 generally accepted accounting principles. However, from time to time, MMLP uses certain non-GAAP financial measures such as distributable cash flow because 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 flow after it has satisfied the capital and related requirements of its operations. Distributable cash flow is not a measure of financial performance or liquidity under GAAP. It should not be considered in isolation or as an indicator of MMLP’s performance. 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 Company 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 its Consolidated Statements of Operations), plus depreciation and amortization and amortization of deferred debt issue costs (as reported in its Consolidated Statements of Cash Flows), plus proceeds from sale of property, plant and equipment (as reported in its Consolidated Statements of Cash Flows), less gain on sale of property, plant and equipment (as reported in its Consolidated Statements of Cash Flows), plus distributions from unconsolidated entities (as reported in its Consolidated Statements of Cash Flows), plus distributions in-kind from equity investments (as reported in its Consolidated Statements of Cash Flows), less non-cash mark-to-market on derivatives (as reported in its Consolidated Statements of Cash Flows), plus distributions in-kind from equity investments (as reported in its Consolidated Statements of Cash Flows), less repayment of debt (as described below), less maintenance capital expenditures (as described below), less investments in unconsolidated partnerships (as reported in its Consolidated Statements of Cash Flows), less equity in earnings of unconsolidated entities (as reported in its Consolidated Statements of Operations). Repayment of debt represents a semi-annual payment by MMLP of principal on U.S. Government Guaranteed Ship Financing Bonds assumed in connection with the acquisition of the partnership interests in CF Martin Sulphur not previously owned by MMLP. Such indebtedness was paid in full by MMLP on March 6, 2006. MMLP’s maintenance capital expenditures, along with its expansion capital expenditures, are components of payments for property, plant, and equipment included in its Consolidated Statements of Cash Flows. For the year ended December 31, 2005, MMLP had $5.1 million in maintenance capital expenditures and $74.1 million in expansion capital expenditures.

Contacts:

     Robert D. Bondurant, Executive Vice President and Chief Financial Officer of Martin Midstream GP LLC, the Company’s general partner at (903) 983-6200.

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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED BALANCE SHEETS

	December 31,
	2005			2004
	(Dollars in thousands)
Assets
Cash	$	6,465		$	3,184
Accounts and other receivables, less allowance for doubtful accounts of $140 and $427		72,162			43,526
Product exchange receivables		2,141			50
Inventories		33,909			23,165
Due from affiliates		1,475			1,892
Other current assets		1,420			724
Total current assets		117,572			72,541
Property, plant, and equipment, at cost		235,218			148,241
Accumulated depreciation		(59,505	)		(38,472	)
Property, plant and equipment, net		175,713			109,769
Goodwill		27,600			2,922
Investment in unconsolidated entities		59,879			—
Other assets, net		8,280			3,100
	$	389,044		$	188,332
Liabilities and Capital
Current installments of long-term debt	$	9,104			—
Trade and other accounts payable		67,387		$	26,537
Product exchange payables		9,624			9,081
Due to affiliates		3,492			429
Income taxes payable		6,345			—
Other accrued liabilities		3,617			2,443
Total current liabilities		99,569			38,490
Long-term debt		192,200			73,000
Other long-term obligations		1,710			1,308
Total liabilities		293,479			112,798
Partners’ capital		95,565			75,534
Commitments and contingencies
	$	389,044		$	188,332

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 to be filed with the Securities and Exchange Commission.

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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS

	Year Ended December 31,
	2005			2004			2003
	(Dollars in thousands, except per unit
	amounts)
Revenues:
Terminalling and storage	$	23,081		$	17,919		$	6,921
Marine transportation		35,451			34,780			26,342
Product sales:
Natural gas/LPG services		301,676			203,427			133,038
Sulfur		36,784			—			—
Fertilizer		31,634			29,780			26,296
Terminalling and storage		9,817			8,238			134
		379,911			241,445			159,468
Total revenues		438,443			294,144			192,731
Costs and expenses:
Cost of products sold:
Natural gas/LPG services		291,109			197,859			128,055
Sulfur		25,657			—			—
Fertilizer		26,975			25,342			22,730
Terminalling and storage		8,079			6,775			107
		351,820			229,976			150,892
Expenses:
Operating expenses		46,888			34,475			21,590
Selling, general and administrative		8,133			6,198			4,986
Depreciation and amortization		12,642			8,766			4,765
Total costs and expenses		419,483			279,415			182,233
Other operating income		—			—			589
Operating income		18,960			14,729			11,087
Other income (expense):
Equity in earnings of unconsolidated entities		1,591			912			2,801
Interest expense		(6,909	)		(3,326	)		(2,001	)
Other, net		238			11			94
Total other income (expense)		(5,080	)		(2,403	)		894
Net income	$	13,880		$	12,326		$	11,981
General partner’s interest in net income	$	278		$	247		$	240
Limited partners’ interest in net income	$	13,602		$	12,079		$	11,741
Net income per limited partner unit	$	1.58		$	1.45		$	1.64
Weighted average limited partner units		8,583,634			8,349,551			7,153,362

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 to be filed with the Securities and Exchange Commission.

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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL/EQUITY
For the years ended December 31, 2005, 2004 and 2003

	Partners' Capital
												General
	Limited Partners											Partner
	Common					Subordinated
	Units		Amount			Units			Amount			Amount			Total
	(Dollars in thousands)
Balances — December 31, 2002		2,900,000	$	48,396			4,253,362		$	(1,288	)	$	(2	)	$	47,106
Net income				4,760			—			6,981			240			11,981
Cash distributions ($1.81 per unit)		—		(5,242	)		—			(7,689	)		(264	)		(13,195	)
Balances — December 31, 2003		2,900,000		47,914			4,253,362			(1,996	)		(26	)		45,892
Net income		—		5,923			—			6,156			247			12,326
Follow-on public offering		1,322,500		34,016			—			—			—			34,016
General partner contribution		—		—			—			—			754			754
Cash distributions ($2.10 per unit)		—		(8,173	)		—			(8,932	)		(349	)		(17,454	)
Balances — December 31, 2004		4,222,500		79,680			4,253,362			(4,772	)		626			75,534
Net income		—		6,756			—			6,846			278			13,880
Units issued in connection with Prism Gas acquisition		756,480		24,616			—			—			—			24,616
Conversion of subordinated units to common units		850,672		(1,599	)		(850,672	)		1,599			—			—
General partner contribution		—		—			—			—			502			502
Cash distributions ($2.19 per unit)		—		(9,247	)		—			(9,315	)		(405	)		(18,967	)
Balances — December 31, 2005		5,829,652	$	100,206			3,402,690		$	(5,642	)	$	1,001		$	95,565

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 to be filed with the Securities and Exchange Commission.

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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS

	Year Ended December 31,
	2005			2004			2003
	(Dollars in thousands)
Cash flows from operating activities:
Net income	$	13,880		$	12,326		$	11,981
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		12,628			8,753			4,765
Amortization of deferred debt issue costs		600			886			486
Accretion of asset retirement obligations		14			13			—
(Gain) loss on disposition or sale of property, plant, and equipment		(37	)		48			(3	)
(Gain) loss on involuntary conversion of property, plant, and equipment		—			—			(589	)
Equity in earnings of unconsolidated entities		(1,591	)		(912	)		(2,801	)
Non-cash mark-to-market on derivatives		(555	)		—			—
Distribution in-kind from equity investments		1,115			—			—
Change in current assets and liabilities, excluding effects of acquisitions and dispositions:
Accounts and other receivables		(10,565	)		(16,499	)		(6,802	)
Product exchange receivables		(1,974	)		1,733			(743	)
Inventories		(4,474	)		(3,502	)		(4,152	)
Due from affiliates		417			(1,730	)		170
Other current assets		36			32			(483	)
Trade and other accounts payable		27,669			9,171			3,359
Product exchange payables		(8,238	)		1,859			4,937
Due to affiliates		3,063			(131	)		560
Other accrued liabilities		(496	)		765			(412	)
Change in other non-current assets, net		288			—			—
Change in other non-current liabilities, net		323			—			—
Net cash provided by operating activities		32,103			12,812			10,273
Cash flows from investing activities:
Payments for property, plant, and equipment		(24,814	)		(5,182	)		(2,904	)
Acquisitions, net of cash acquired		(114,167	)		(31,234	)		(29,028	)
Proceeds from sale of property, plant, and equipment		95			114			3
Insurance proceeds on fire loss		—			—			744
Investments in unconsolidated partnerships		(322	)		—			—
Distributions from unconsolidated partnerships		697			1,980			3,564
Net cash used in investing activities		(138,511	)		(34,322	)		(27,621	)
Cash flows from financing activities:
Payments of long-term debt		(134,091	)		(43,215	)		—
Net proceeds from follow on public offering		—			34,016			—
General partner contribution		502			754			—
Proceeds from long-term debt		250,900			49,215			32,000
Payments of debt issuance costs		(3,655	)		(892	)		(921	)
Cash distributions paid		(18,967	)		(17,454	)		(13,195	)
Proceeds from issuance of common units		15,000			—			—
Net cash provided by financing activities		109,689			22,424			17,884
Net increase in cash		3,281			914			536
Cash at beginning of period		3,184			2,270			1,734
Cash at end of period	$	6,465		$	3,184		$	2,270
Non-cash:
Financed portion of non-compete agreement	$	690		$	398
Common units issued for acquisitions	$	9,616

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 to be filed with the Securities and Exchange Commission.

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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

	4thQuarter			4thQuarter
	2005			2004
	(Dollars in thousands, except per
	unit amounts)
Revenues:
Terminalling and storage	$	6,223		$	5,296
Marine transportation		8,817			9,701
Product sales:
Natural gas/LPG services		102,189			67,078
Sulfur		19,041			—
Fertilizer		5,654			7,383
Terminalling and storage		2,703			2,175
		129,587			76,636
Total revenues		144,627			91,633
Costs and expenses:
Cost of products sold:
Natural gas/LPG services		98,922			65,392
Sulfur		13,627			—
Fertilizer		5,020			5,891
Terminalling and storage		2,110			1,784
		119,679			73,067
Expenses:
Operating expenses		14,110			8,989
Selling, general and administrative		2,713			2,034
Depreciation and amortization		3,970			2,490
Total costs and expenses		140,472			86,580
Operating income		4,155			5,053
Other income (expense):
Equity in earnings of unconsolidated entities		1,369			380
Interest expense		(3,075	)		(988	)
Other, net		111			(41	)
Total other income (expense)		(1,595	)		(649	)
Net income	$	2,560		$	4,404
General partner’s interest in net income	$	51		$	88
Limited partners’ interest in net income	$	2,509		$	4,316
Net income per limited partner unit	$	.28		$	.51
Weighted average limited partner units		8,903,438			8,475,862

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 to be filed with the Securities and Exchange Commission.

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MARTIN MIDSTREAM PARTNERS L.P.
DISTRIBUTABLE CASH FLOW
(Dollars in thousands)
(Unaudited Non-GAAP Financial Measure)

	Three Months
	Ended			Year Ended
	December 31,			December 31,
	2005			2005
Net income	$	2,560		$	13,880
Adjustments to reconcile net income to distributable cash flow:
Depreciation and amortization		3,970			12,642
Proceeds from sale of property, plant and equipment		49			95
Gain on sale of property, plant and equipment		(37	)		(37	)
Distributions from unconsolidated entities		697			697
Distributions in-kind from equity investments		1,115			1,115
Amortization of deferred debt issue costs		204			600
Non-cash mark-to-market on derivatives		(555	)		(555	)
Repayment of debt (1)		—			(291	)
Maintenance capital expenditures (2)		(1,922	)		(5,100	)
Investments in unconsolidated partnerships		(322	)		(322	)
Equity in earnings of unconsolidated entities		(1,369	)		(1,591	)
Distributable cash flow	$	4,390		$	21,133

(1) Represents a semi-annual payment by MMLP of principal on U.S. Government Guaranteed Ship Financing Bonds assumed in connection with the acquisition of the partnership interests in CF Martin Sulphur not owned by MMLP. Such indebtedness was paid in full by MMLP on March 6, 2006.

(2) Maintenance capital expenditures, along with expansion capital expenditures, are components of payments for property, plant and equipment set forth in MMLP’s Consolidated Statements of Cash Flows. MMLP had $5.1 million in maintenance capital expenditures and $74.1 million in expansion capital expenditures for the year ended December 31, 2005. MMLP had $1.9 million in maintenance capital expenditures and $41.0 million in expansion capital expenditures for the quarter ended December 31, 2005.

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