EXHIBIT 99.1
MARTIN MIDSTREAM PARTNERS REPORTS
THIRD QUARTER 2004 RESULTS -- MULTIPLE HURRICANES IMPACT EARNINGS -- AND
ANNOUNCES NEW CREDIT FACILITY
KILGORE, Texas, November 2, 2004 /PRNewswire-FirstCall via COMTEX/ --
Martin Midstream Partners L.P. (Nasdaq: MMLP) announced today its results of
operations for the third quarter ended September 30, 2004 and a new credit
facility with the Royal Bank of Canada.
Third Quarter 2004 Results
MMLP reported net income for the third quarter of 2004 of $1.9 million,
on revenues of $72.2 million, compared to net income for the third quarter of
2003 of $2.2 million, on revenues of $40.2 million. MMLP's net income per
limited partner unit for the third quarter of 2004 was $0.22, compared to net
income per limited partner unit for the third quarter of 2003 of $0.30.
MMLP reported net income for the nine months ended September 30, 2004
of $7.9 million, on revenues of $202.5 million, compared to net income of $8.3
million, on revenues of $140.1 million, for the nine months ended September 30,
2003. MMLP's net income per limited partner unit for the nine months ended
September 30, 2004 was $0.93, compared to net income per limited partner unit
for the nine months ended September 30, 2003 of $1.14.
The Company's distributable cash flow for the third quarter of 2004 was
$4.0 million, or 0.93 times the amount required under its partnership agreement
to cover the minimum quarterly distribution of $4.3 million on its common and
subordinated units for such quarter. The Company's distributable cash flow for
the nine months ended September 30, 2004 was $12.5 million, or 0.98 times the
amount required under its partnership agreement to cover the minimum quarterly
distributions of $12.7 million on its common and subordinated units for such
nine month period. As previously announced, MMLP has made or will make cash
distributions to its common and subordinated unitholders of $0.525 per unit in
respect of each of the first, second and third quarters of 2004. These
distributions were or will be in excess of the minimum quarterly distributions
of $0.50 per common and subordinated unit required under its partnership
agreement. 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 of this non-GAAP financial measure and its
reconciliation to the most comparable GAAP measurement.
Ruben S. Martin, President and Chief Executive Officer of Martin
Midstream GP LLC, MMLP's general partner, said "the four hurricanes experienced
in Florida and the Gulf of Mexico during the third quarter contributed directly
to a reduction in our net income. The hurricanes disrupted CF Martin Sulphur's
ability to make deliveries of sulfur to Tampa, Florida, thereby resulting in a
reduction in the amount of cash distributed to us by CF Martin Sulphur. In
addition, our marine transportation business suffered adverse effects from the
hurricanes. We believe the impact to our net income was approximately $0.11 per
unit. Our distributable cash
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was also adversely affected as a result of the hurricanes, as well as by an
increase in capital expenditures resulting from increased steel and shipyard
costs. Except for the negative impact of the four hurricanes, we were pleased
with the financial performance of the Company."
"We are encouraged that the sulfur deliveries of CF Martin Sulphur as
well as marine transportation activity levels have shown steady improvement over
the last several weeks. In September we acquired an additional full service
marine terminal in Freeport Texas to better serve our Gulf of Mexico customers."
"We are pleased to have closed on October 29, 2004 a new $100 million
credit facility with Royal Bank of Canada, which includes $30 million for
working capital and $70 million for acquisitions and capital expenditures. At
closing, we had approximately $13.5 million in unused working capital capacity,
which provides us with more than enough excess working capital capacity to
operate in this high commodity price environment. Also, at closing we had $55
million drawn on our acquisition facility, leaving us with $15 million available
for growth. However, we will, with lender participation, be able to expand the
facility to $150 million without any amendments, giving us debt capacity to
continue our disciplined growth strategy."
Included with this press release are MMLP's Consolidated and Condensed
Balance Sheets as of September 30, 2004 and December 31, 2003, its Consolidated
and Condensed Statements of Operations for the three months and nine months
ended September 30, 2004 and 2003 and its Consolidated and Condensed Statements
of Cash Flows for the nine months ended September 30, 2004 and 2003. 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 November 2, 2004.
Investors' Conference Call
An investors' conference call to review the third quarter results will
be held on Wednesday, November 3, 2004, at 3:00 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 6:00 p.m.
Central Time on November 3, 2004 through 11:59 p.m. Central Time on November 10,
2004. The access codes for the conference call and the audio replay are as
follows: Account No. 1628; Conference ID No. 122687. 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 provides terminalling, marine transportation,
distribution and midstream logistical services for producers and suppliers of
hydrocarbon products and by-products, lubricants 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.
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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 in 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 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
and Condensed Statements of Operations), plus depreciation and amortization and
amortization of deferred debt issue costs (as reported in its Consolidated and
Condensed Statements of Cash Flows), plus proceeds from sale of property, plant
and equipment (as reported in its Consolidated and Condensed Statements of Cash
Flows), less gain on sale of property, plant and equipment (as reported in its
Consolidated and Condensed Statements of Cash Flows), less maintenance capital
expenditures (as defined below), plus distributions from unconsolidated
partnership (as reported in its Consolidated and Condensed Statements of Cash
Flows), less equity in earnings (loss) from unconsolidated entities (as reported
in its Consolidated and 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 Condensed
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Statements of Cash Flows. For the three months ended September 30, 2004, MMLP
had $4.6 million of capital expenditures and for the nine months ended September
30, 2004, MMLP had $32.6 million of capital expenditures. For the three months
ended September 30, 2004, MMLP had $3.2 million of expansion capital
expenditures and for the nine months ended September 30, 2004, MMLP had $28.9
million of expansion capital expenditures.
Contacts:
Robert D. Bondurant, Executive Vice President and Chief Financial Officer of
MMLP's general partner, Martin Midstream GP LLC, at (903) 983-6200.
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND CONDENSED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
SEPTEMBER 30, DECEMBER 31,
2004 2003
------------- ------------
(UNAUDITED) (AUDITED)
ASSETS
Cash .................................................................... $ 2,227 $ 2,270
Accounts and other receivables, less allowance for doubtful accounts
of $488 and $329 ...................................................... 32,493 27,027
Product exchange receivables ............................................ 158 1,783
Inventories ............................................................. 21,943 19,663
Due from affiliates ..................................................... 3,257 162
Other current assets .................................................... 932 756
--------- ---------
Total current assets .................................................. 61,010 51,661
--------- ---------
Property, plant, and equipment, at cost ................................. 145,842 113,907
Accumulated depreciation ................................................ (36,586) (30,946)
--------- ---------
Property, plant and equipment, net .................................... 109,256 82,961
--------- ---------
Goodwill ................................................................ 2,922 2,922
Investment in unconsolidated entities ................................... -- 318
Other assets, net ....................................................... 2,406 1,823
--------- ---------
$ 175,594 $ 139,685
========= =========
LIABILITIES AND PARTNERS' CAPITAL
Trade and other accounts payable ........................................ $ 19,134 $ 17,366
Product exchange payables ............................................... 8,230 7,222
Due to affiliates ....................................................... 210 560
Other accrued liabilities ............................................... 2,150 1,645
--------- ---------
Total current liabilities ............................................. 29,724 26,793
--------- ---------
Long-term debt .......................................................... 69,000 67,000
Other long-term obligations ............................................. 1,199 --
--------- ---------
Total liabilities ..................................................... 99,923 93,793
--------- ---------
Partners' capital ....................................................... 75,671 45,892
Commitments and contingencies
--------- ---------
$ 175,594 $ 139,685
========= =========
These financial statements should be read in conjunction with the financial
statements and accompanying notes and the other information included in MMLP's
Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission
on November 2, 2004.
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER UNIT AMOUNTS)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
---------------------------- ----------------------------
2004 2003 2004 2003
----------- ----------- ----------- -----------
Revenues:
Terminalling ........................................... $ 5,194 $ 1,769 $ 12,623 $ 5,038
Marine transportation .................................. 8,394 6,470 25,079 19,582
Product sales:
LPG distribution .................................... 51,527 26,617 136,349 95,335
Fertilizer .......................................... 5,016 5,384 22,397 20,143
Terminalling ........................................ 2,059 -- 6,063 --
----------- ----------- ----------- -----------
58,602 32,001 164,809 115,478
----------- ----------- ----------- -----------
Total revenues .................................. 72,190 40,240 202,511 140,098
----------- ----------- ----------- -----------
Costs and expenses:
Cost of products sold:
LPG distribution .................................... 49,697 25,728 132,467 92,116
Fertilizer .......................................... 4,559 4,933 19,316 17,579
Terminalling ........................................ 1,668 -- 4,991 --
----------- ----------- ----------- -----------
55,924 30,661 156,774 109,695
Expenses:
Operating expenses ..................................... 8,474 4,977 23,434 14,908
Selling, general and administrative .................... 2,315 1,444 6,351 4,576
Depreciation and amortization .......................... 2,404 1,192 6,276 3,515
----------- ----------- ----------- -----------
Total costs and expenses ............................ 69,117 38,274 192,835 132,694
----------- ----------- ----------- -----------
Operating income .................................... 3,073 1,966 9,676 7,404
----------- ----------- ----------- -----------
Other income (expense):
Equity in earnings (loss) of unconsolidated entities ... (359) 580 532 2,308
Interest expense ....................................... (876) (394) (2,338) (1,442)
Other, net ............................................. 24 29 52 68
----------- ----------- ----------- -----------
Total other income (expense) ........................ (1,211) 215 (1,754) 934
----------- ----------- ----------- -----------
Net income ............................................. $ 1,862 $ 2,181 $ 7,922 $ 8,338
=========== =========== =========== ===========
General partner's interest in net income ................. $ 37 $ 44 $ 158 $ 167
Limited partners' interest in net income ................. $ 1,825 $ 2,137 $ 7,764 $ 8,171
Net income per limited partner unit ...................... $ 0.22 $ 0.30 $ 0.93 $ 1.14
Weighted average limited partner units ................... 8,475,862 7,153,362 8,307,139 7,153,362
These financial statements should be read in conjunction with the financial
statements and accompanying notes and the other information included in MMLP's
Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission
November 2, 2004.
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MARTIN MIDSTREAM PARTNERS L.P.
CONSOLIDATED AND CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
NINE MONTHS ENDED
SEPTEMBER 30,
---------------------------
2004 2003
-------- --------
Cash flows from operating activities:
Net income ....................................................................... $ 7,922 $ 8,338
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization ................................................. 6,276 3,515
Amortization of deferred debt issuance costs .................................. 725 355
Gain on sale of property, plant and equipment ................................. (9) --
Equity in earnings of unconsolidated entities ................................. (532) (2,308)
Change in current assets and liabilities, excluding effects of acquisitions
and dispositions:
Accounts and other receivables ............................................... (5,466) 2,038
Product exchange receivables ................................................. 1,625 (1,245)
Inventories .................................................................. (2,280) (1,737)
Due from affiliates .......................................................... (3,095) (463)
Other current assets ......................................................... (176) (79)
Trade and other accounts payable ............................................. 1,768 (2,157)
Product exchange payables .................................................... 1,008 6,193
Due to affiliates ............................................................ (350) 770
Other accrued liabilities .................................................... 473 (779)
-------- --------
Net cash provided by operating activities .......................... 7,889 12,441
-------- --------
Cash flows from investing activities:
Payments for property, plant and equipment ....................................... (4,335) (1,346)
Acquisitions ..................................................................... (29,251) --
Proceeds from sale of property, plant and equipment .............................. 114 --
Distributions from unconsolidated partnership .................................... 1,683 2,673
-------- --------
Net cash provided by (used in) investing activities ................ (31,789) 1,327
-------- --------
Cash flows from financing activities:
Payments of long-term debt ....................................................... (39,350) --
Proceeds from long-term debt ..................................................... 41,350 --
Cash distributions paid .......................................................... (12,913) (9,546)
General partner contribution ..................................................... 754 --
Follow on offering ............................................................... 34,016 --
-------- --------
Net cash provided by (used in) by financing activities ............. 23,857 (9,546)
-------- --------
Net increase(decreae) in cash and cash equivalents ................. (43) 4,222
Cash at beginning of period ........................................................ 2,270 1,734
-------- --------
Cash at end of period .............................................................. $ 2,227 $ 5,956
======== ========
Non-cash:
Financed portion of non-compete agreement .......................................... $ 398 $ --
======== ========
These financial statements should be read in conjunction with the financial
statements and accompanying notes and the other information included in MMLP's
Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission
on November 2, 2004.
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MARTIN MIDSTREAM PARTNERS L.P.
DISTRIBUTABLE CASH FLOW
(DOLLARS IN THOUSANDS)
(UNAUDITED NON-GAAP FINANCIAL MEASURE)
THREE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
2004 2004
------------- -------------
Net income ................................................... $ 1,862 $ 7,922
Adjustments to reconcile net income to distributable cash
flow:
Depreciation and amortization ............................. 2,404 6,276
Proceeds from sale of property, plant and equipment ....... 114 114
Gain on sale of property, plant and equipment ............. (9) (9)
Amortization of deferred debt issue costs ................. 240 725
Maintenance capital expenditures(1) ....................... (1,462) (3,694)
Distributions from unconsolidated partnership(2)........... 495 1,683
Equity in (earnings) loss of unconsolidated entities ...... 359 (532)
-------- --------
Distributable cash flow ...................................... $ 4,003 $ 12,485
======== ========
- --------
(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 ended September 30, 2004, MMLP had $4.6 million of capital expenditures
and for the nine months ended September 30, 2004, MMLP had $32.6 million of
capital expenditures. For the three months ended September 30, 2004, MMLP had
$3.2 million of expansion capital expenditures and for the nine months ended
September 30, 2004, MMLP had $28.9 million of expansion capital expenditures.
(2) Distributions from unconsolidated partnership represents distributions
received by MMLP from CF Martin Sulphur, L.P., in which MMLP owns an
unconsolidated non-controlling 49.5% limited partnership interest. As reported
in MMLP's Consolidated and Condensed Statements of Cash Flows, MMLP received
distributions of $1.7 million for the nine months ended September 30, 2004. MMLP
received distributions of $0.5 million for the three months ended Septebmber 30,
2004.
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