EXHIBIT 99.1
MARTIN MIDSTREAM PARTNERS L.P. REPORTS
SECOND QUARTER 2003 RESULTS
KILGORE, Texas, August 8, 2003 /PRNewswire-FirstCall via COMTEX/ --
Martin Midstream Partners L.P. (Nasdaq: MMLP) announced today its results of
operations for the second quarter ended June 30, 2003.
MMLP commenced the reporting of its own financial results on November
6, 2002, the date of its initial public offering. Prior to such date, MMLP's
financial results are reported through the financial statements of its
predecessor.
MMLP reported net income for the second quarter of 2003 of $2.8
million*, on revenues of $38.7 million, compared to predecessor net income
before income taxes of $0.9 million, on revenues of $32.7 million, for the
second quarter of 2002. MMLP's net income per limited partner unit for the
second quarter of 2003 was $0.39.
MMLP reported net income for the six months ending June 30, 2003 of
$6.2 million*, on revenues of $99.9 million, compared to predecessor net income
before income taxes of $3.7 million, on revenues of $68.3 million, for the six
months ending June 30, 2002. MMLP's net income per limited partner unit for the
six months ended June 30, 2003 was $0.84.
The Company's distributable cash flow for the second quarter of 2003
was $4.0 million, OR 1.09 times the amount required under our partnership
agreement to cover the minimum quarterly distribution of $3.65 million on our
common and subordinated units for such quarter. The Company's distributable cash
flow for the six months ended June 30, 2003 was $7.9 million, or 1.08 times the
amount required under our partnership agreement to cover the minimum quarterly
distribution of $7.3 million on our common and subordinated units for such six
month period. Distributable cash flow is a non-GAAP financial measure which is
explained in greater detail below under "Use of Non-GAAP Financial Information".
The Company has also included below a table entitled "Distributable Cash Flow"
in order to show the components to this non-GAAP financial measure and its
reconciliation to the most comparable GAAP measurement.
Included with this press release are MMLP's Consolidated Condensed
Balance Sheets as of June 30, 2003 and December 31, 2002, its Consolidated and
Combined Condensed Statements of Operations for the three months and six months
ended June 30, 2003 and 2002 and its Consolidated and Combined Condensed
Statements of Cash Flows for the six months ended June 30, 2003 and 2002. These
financial statements should be read in conjunction with the information
contained in the Company's Quarterly Report on Form 10-Q, filed with the
Securities and Exchange Commission on August 8, 2003.
Ruben Martin, President and Chief Executive Officer of Martin Midstream
GP LLC, the general partner of Martin Midstream Partners, said "We are pleased
with Martin Midstream's performance and the returns to our unitholders. We
continue to evaluate several potential acquisition targets which meet our
disciplined pricing criteria. These investments must be accretive to earnings
while maintaining our target long term debt to total capitalization ratio of
less than 50%. Any such acquisitions, along with our internal growth, will
continue to make Martin Midstream Partners an attractive investment."
* Contains no effect of income taxes since MMLP is a non-taxable partnership.
Conference Call
A conference call to review the second quarter 2003 results will be
held on Monday, August 11, 2003, at 4:00 p.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
August 12, 2003 through 10:59 p.m. Central Time on August 19, 2003. The access
codes for the conference call and the audio replay are as follows: Account No.
1628; Conference ID No. 72890. The audio replay of the conference call will also
be archived on the Company's website at http://www.martinmidstream.com.
About Martin Midstream Partners
Martin Midstream Partners provides marine transportation, terminalling,
distribution and midstream logistical services for producers and suppliers of
hydrocarbon products and by-products, specialty chemicals and other liquids. The
Company also manufactures and markets sulfur-based fertilizers and related
products and owns an unconsolidated non-controlling 49.5% limited partnership
interest in CF Martin Sulphur L.P., which operates a sulfur storage and
transportation business. MMLP operates primarily in the Gulf Coast region of the
United States.
Additional information concerning the Company is available on the
Company's website at http://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 in anticipating
or predicting certain important factors. These factors include, but are not
limited to: adverse weather conditions; reliance on its unconsolidated
non-controlling interest in CF Martin Sulphur L.P.; the incurrence of material
liabilities that are not fully covered by insurance; the price volatility and
the supply availability of hydrocarbon products and by-products; restrictions in
its debt agreements; the prospects for future acquisitions and its ability to
make future acquisitions; the performance of recently acquired businesses; the
seasonality of its business; the competition in the industry; changes in
regulations on the federal, state and local level that are applicable to its
business; the cost of attracting and retaining highly skilled personnel; the
loss of significant commercial relationships with Martin Resource Management
Corporation ("MRMC"); interruption in operations at its facilities; federal
regulations applicable to its marine vessels and regulations effecting the
domestic tank vessel industry; cost reimbursements it is required to pay to
MRMC; conflicts of interest and competition with MRMC; the decisions made by and
the control of its general partner; and a decision by the IRS
to tax MMLP as a corporation. 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
statements, including financial estimates, whether as a result of new
information, future event, 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 to 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
and Combined Condensed Statements of Operations), plus depreciation and
amortization and amortization of deferred debt issue costs (as reported in its
Consolidated and Combined Condensed Statements of Cash Flows), less maintenance
capital expenditures (as defined below), plus distributions from unconsolidated
partnership (as reported in its Consolidated and Combined Condensed Statements
of Cash Flows), less equity in earnings from unconsolidated entities (as
reported in its Consolidated and Combined Condensed Statements of Operations).
MMLP's maintenance capital expenditures, along with its expansion capital
expenditures, are components of payments for property, plant, and equipment
included in its Consolidated and Combined Condensed Statements of Cash Flows.
For the three months and six months ended June 30, 2003, MMLP did not have any
expansion capital expenditures.
Contacts:
Robert D. Bondurant, Executive Vice President and Chief Financial Officer of
Martin Midstream GP LLC, (903) 983-6200.
MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED CONDENSED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
<Table>
<Caption>
JUNE 30, DECEMBER 31
2003 2002
(UNAUDITED) (AUDITED)
----------- ---------
ASSETS
Cash .............................................................................. $ 5,536 $ 1,734
Accounts and other receivables, less allowance for doubtful accounts
of $293 and $355 ................................................................ 18,642 20,225
Product exchange receivables ...................................................... 170 1,040
Inventories ....................................................................... 11,305 15,511
Due from affiliates ............................................................... 653 332
Other current assets .............................................................. 510 273
--------- ---------
Total current assets ......................................................... 36,816 39,115
--------- ---------
Property, plant, and equipment, at cost ........................................... 84,203 83,345
Accumulated depreciation .......................................................... (29,765) (27,488)
--------- ---------
Property, plant and equipment, net ........................................... 54,438 55,857
--------- ---------
Goodwill .......................................................................... 2,922 2,922
Investment in unconsolidated entities ............................................ 1,027 1,081
Other assets, net ................................................................. 1,197 1,480
--------- ---------
$ 96,400 $ 100,455
========= =========
LIABILITIES AND PARTNERS' CAPITAL
Trade and other accounts payable .................................................. $ 10,877 $ 14,007
Product exchange payables ......................................................... 3,733 2,285
Due to affiliates ................................................................. 240 --
Other accrued liabilities ......................................................... 1,183 2,057
--------- ---------
Total current liabilities .................................................... 16,033 18,349
Long-term debt .................................................................... 33,000 35,000
--------- ---------
Total liabilities ............................................................ 49,033 53,349
--------- ---------
Partners' capital ................................................................. 47,367 47,106
Commitments and contingencies .....................................................
--------- ---------
$ 96,400 $ 100,455
========= =========
</Table>
These financial statements should be read in conjunction with the accompanying
notes and other information included in MMLP's related Quarterly Report on Form
10-Q, filed with the Securities and Exchange Commission on August 8, 2003.
MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND COMBINED CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<Table>
<Caption>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------------- -----------------------------
2003 2002 2003 2002
------------- ------------- ------------- -------------
(Partnership) (Predecessor) (Partnership) (Predecessor)
Revenues:
Marine transportation ......................... $ 6,659 $ 5,961 $ 13,112 $ 11,651
Terminalling .................................. 1,789 1,338 3,269 2,392
Product sales:
LPG distribution .......................... 23,455 16,845 68,718 38,379
Fertilizer ................................ 6,756 8,601 14,759 15,918
----------- ----------- ----------- -----------
30,211 25,446 83,477 54,297
----------- ----------- ----------- -----------
Total revenues ....................... 38,659 32,745 99,858 68,340
----------- ----------- ----------- -----------
Costs and expenses:
Cost of products sold:
LPG distribution .......................... 22,759 16,011 66,388 35,751
Fertilizer ................................ 5,887 7,192 12,646 12,724
----------- ----------- ----------- -----------
28,646 23,203 79,034 48,475
Expenses:
Operating expenses ............................ 4,860 5,316 9,931 10,018
Selling, general and administrative ........... 1,615 1,720 3,132 3,374
Depreciation and amortization ................. 1,176 1,186 2,323 2,216
----------- ----------- ----------- -----------
Total costs and expenses .................. 36,297 31,425 94,420 64,083
----------- ----------- ----------- -----------
Operating income .......................... 2,362 1,320 5,438 4,257
----------- ----------- ----------- -----------
Other income (expense):
Equity in earnings of unconsolidated entities.. 934 535 1,728 1,470
Interest expense .............................. (496) (955) (1,048) (2,039)
Other, net .................................... 23 7 39 15
----------- ----------- ----------- -----------
Total other income (expense) .............. 461 (413) 719 (554)
----------- ----------- ----------- -----------
Income before income taxes ................ 2,823 907 6,157 3,703
Income taxes ....................................... -- 194 -- 1,333
----------- ----------- ----------- -----------
Net income .................................... $ 2,823 $ 713 $ 6,157 $ 2,370
=========== =========== =========== ===========
General partner's interest in net income ........... $ 56 $ 123
Limited partners' interest in net income ........... $ 2,767 $ 6,034
Net income per limited partner unit ................ $ 0.39 $ 0.84
Weighted average limited partner units ............. 7,153,362 7,153,362
</Table>
These financial statements should be read in conjunction with the accompanying
notes and other information included in MMLP's related Quarterly Report on Form
10-Q, filed with the Securities and Exchange Commission on August 8, 2003.
MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND COMBINED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
<Table>
<Caption>
SIX MONTHS ENDED
JUNE 30,
---------------------------
2003 2002
------------- -------------
(PARTNERSHIP) (PREDECESSOR)
Cash flows from operating activities:
Net income ...................................................................... $ 6,157 $ 2,370
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization ............................................... 2,323 2,216
Amortization of deferred debt issuance costs ................................ 237 --
Deferred income taxes ....................................................... -- 1,257
Loss on sale of property, plant, and equipment .............................. -- 1
Equity in earnings of unconsolidated entities ............................... (1,728) (1,470)
Change in current assets and liabilities, excluding effects of
acquisitions and dispositions:
Accounts and other receivables .......................................... 1,583 2,448
Product exchange receivables ............................................ 870 (753)
Inventories ............................................................. 4,206 2,832
Due from affiliates ..................................................... (321) --
Other current assets .................................................... (237) (165)
Trade and other accounts payable ........................................ (3,130) 159
Product exchange payables ............................................... 1,448 (2,032)
Due to affiliates ....................................................... 240 --
Other accrued liabilities ............................................... (874) (203)
Change in other noncurrent assets, net ...................................... -- 6
-------- --------
Net cash provided by operating activities ............................ 10,774 6,666
-------- --------
Cash flows from investing activities:
Payments for property, plant, and equipment ..................................... (858) (2,016)
Proceeds from sale of property, plant and equipment ............................. -- 7
Distributions from unconsolidated partnership ................................... 1,782 --
Cash paid for acquisition ....................................................... -- (103)
-------- --------
Net cash provided by (used in) investing activities .................. 924 (2,112)
-------- --------
Cash flows from financing activities:
Payments of long-term debt ...................................................... (2,000) (398)
Cash distributions paid ......................................................... (5,896) --
Borrowings from affiliates ...................................................... -- 24,906
Payments to affiliates .......................................................... -- (28,882)
-------- --------
Net used in by financing activities .................................. (7,896) (4,374)
-------- --------
Net increase in cash and cash equivalents ............................ 3,802 180
Cash at beginning of period .......................................................... 1,734 62
-------- --------
Cash at end of period ................................................................ $ 5,536 $ 242
======== ========
</Table>
These financial statements should be read in conjunction with the accompanying
notes and other information included in MMLP's related Quarterly Report on Form
10-Q, filed with the Securities and Exchange Commission on August 8, 2003.
MARTIN MIDSTREAM PARTNERS L.P.
DISTRIBUTABLE CASH FLOW
(DOLLARS IN THOUSANDS)
(UNAUDITED NON-GAAP FINANCIAL MEASURE)
<Table>
<Caption>
THREE MONTHS SIX MONTHS
ENDED ENDED
MARCH 31, JUNE 30,
2003 2003
----------- ----------
Net income.................................................................. $ 2,823 $ 6,157
Adjustments to reconcile net income to
distributable cash flow:
Depreciation and amortization.......................................... 1,176 2,323
Amortization of deferred debt issue costs.............................. 118 237
Maintenance capital expenditures1...................................... (108) (858)
Distributions from unconsolidated partnership.......................... 891 1,782
Equity in earnings of unconsolidated entities.......................... (934) (1,728)
---------- ----------
Distributable cash flow..................................................... $ 3,966 $ 7,913
========== ==========
</Table>
- --------
(1) Maintenance capital expenditures, along with expansion capital expenditures,
are components of payments for property, plant, and equipment set forth in
MMLP's Consolidated and Combined Condensed Statements of Cash Flows. For the
three months and six months ended June 30, 2003, MMLP did not have any expansion
capital expenditures.