MMLP - Earnings call transcript Q2 2024 | Martin Midstream Partners L.P.

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Operator

Good morning. My name is Audra, and I will be your conference operator today. At this time, I would like to welcome everyone to the MMLP Second Quarter 2024 Earnings Call. Today's conference is being recorded. [Operator Instructions]. At this time, I would like to turn the conference over to Sharon Taylor, Chief Financial Officer. ahead. go Please

Sharon Taylor

morning, Partners Good earnings. welcome the to Thank call everyone, to Midstream conference XXXX discuss Martin you. and second quarter

During on information are earnings for make the release this assumptions to filings made beliefs our will list afternoon issued our as posted website latest management could as SEC and as to call, cause our by team us. the that defined performance refer and as with well forward-looking well SEC. available upon press based statements factors statements differ by our actual the future results expectations. of a currently our and current These as of our we the to yesterday impact from materially Martin, Please

non-GAAP the call. comparable We Bob today includes Cavin, financial financial press release these today's and Controller; on reconciliation their Bondurant, Director measures COO; of to Midstream, measures Danny of me earnings call on a FP&A. measures. With Randy The of Tauscher, non-GAAP Martin David are Cannon, CEO financial will GAAP discuss

Bob turn discuss over to to I'll Now second quarter it earnings.

Robert Bondurant

Thanks, begin would like by discussion on overall I second operating performance. the our quarter Sharon. focusing to

the we distinct adjusted casualty second $XX.X losses that compared and exceeded quarter. $X.X the in $X we exceeded will by second guidance in my had I events We comments. million. later quarter, For second quarter as despite segment million EBITDA separate X million million $XX.X discuss of of guidance to guidance by these million $X.X totaled

$XX.X of guidance million had cash adjusted compared $XX.X adjusted transportation segment, our quarter, once segment, million. For to million. which of $X.X again EBITDA our this million largest had our land was of to generator Within business second compared $X.X the guidance of flow EBITDA Transportation

to operating million slowly the we new. to compared trader as replace quarter older truck lower Our expense operating trend with expenses $X.X and mileage forecast. guidance were Also, our relative should million second exceeded equipment forecast by we costs forecast forecasted as below primarily by to $X.X X%. beat when operating revenue This due continue

to other sulfur Looking seen from and such in continue area we towards the product Beaumont third strength but quarter, chemicals of lines refineries, hauling slowdown have as lubricants. in a a see bit our

or believe we our the guidance should for we However, be land at quarter near business. in third transportation

scheduled tow dock of Our explained marine that the reduced Marine had equipment coverage the revenue of in was policy. be result Marine longer loss miss of loss in X Transportation was of Texas marine casualty business underperformance The our policy inland May. protection EBITDA forecasted. which the our and utilization of loss under result second allision million our incident. that that a was $X.X bridge than million had This Galveston, $X.X majority during This guidance bridge Also, in involved fleet occurred to the $X.X indemnity whole and a to represents took May. The forecasted. compared occurred in million. inland was of performance balance Transportation from in adjusted transportation we allision relative result guidance insurance the quarter can coverage the dry in the the deductibles lower separate of casualty than This by

providing see Looking in quarter utilization full day forecast, than third our exceed guidance foresee opportunity towards quarter, Transportation continue of Marine business. we third to the and original also our the fleet we rates our to stronger marine

EBITDA segment to of flow strongest was million generator Our $X.X had million. Sulfur our guidance compared adjusted $XX.X quarter of which next second the cash in Services

second EBITDA Our fertilizer quarter. guidance for adjusted the group was same which our had million, $X.X EBITDA the of as

was relative the quarter forecast. to in a to improvement result margin we XX% in margin the actual than compared a XX% realized of fertilizers quarter ton gross of second improvement our the fertilizer less volume products in was sold sold of the per when While second guidance. mix forecast, This

X,XXX quarter, we seasonal to pure Sulfur cash of farmers The the normal Services million sulfur of their side towards segment to fields. harvesting Looking The adjusted as of anticipate from trough the the third EBITDA transition and planting guidance fertilizer flow business $X.X million. our compared primary for our of had sulfur through $X.X customers. our greater our sulfur production strong Beaumont day we production forecast this driver volume Coast into tons XX% as was a of sulfur outperformance volume of managed than was refinery daily logistically Gulf handled from of approximately terminals. or per The

we to weather or remain allow achieve production business. exceed that quarter, customers pure the third these at our side events, in Looking subject Gulf the sulfur higher refinery to us to the from of guidance optimistic towards sulfur levels should remain continue Coast will which

Our flow was million of EBITDA $X generator which third quarter second guidance the Storage largest Terminalling $X.X of and cash million. in adjusted had our segment, to compared

Storage pollution of spill, our liability policy. spot the of miss $X.X a of policy million mid-June. missed relative storage at impact guidance, to this and crude fully on explains under forecast when $X.X the our While a compared we loss spill refinery in pipeline loss a loss million underground by refinery. Because occurred insurance our were and terminals both Terminalling pipeline that tanks we of moves in due question from to Smackover the and to equaling segment oil accrued our The our the caused total shore-based casualty deductibles casualty oil our specialty The to general guidance. casualty storage crude

third this believe towards to Looking quarter, the cash flow return segment's should we guidance.

Specialty our EBITDA quarter underperformance per Greece $X.X comparing of packaged cost offset margin lubricant The our gallon driving our oils $X.X Finally, additive margins to guidance. In by from performance outperformance guidance the an benefited compared business which this business our was sold falling was our our lubricant actual Greece up I million reduced of we to cost. segment. compared in when to a underperformance the million. of entirely our in of to outperformance have we to almost Conversely, Relative in we unit Greece segment, was Products packaged In business adjusted guidance, had would discuss like base to to Greece improvement driver second had the pound business. in due packaged main business, margin per of business, the lubricant third-party cost, while substitute have had we higher forecast. of

we the unusual believe perform we should any Overall, approximate Looking quarter, or guidance towards Midstream's believe should segment. near third weather or guidance. Martin we continue in Specialty third barring at quarter Products our performance operating events, to

sheet, discuss capital to like I'd turn balance Now our capital back resources. and the over to Sharon expenditures to call

Sharon Taylor

Thanks, Bob.

of an $X our million which total was long-term increase outstanding balance $XXX million, on March As of from June XX, XXXX, XX. we had debt

million. credit facility revolving and of Our lien our was amount million, the balance was notes secured notional $XX second $XXX

our capacity $XXX facility million revolving approximately borrowing available $XX issued which was includes credit million, $X million Our under credit. of letters of

dropped $XXX and XXXX. At that million XX, on from the recall, end commitment interest adjusted X.XXx. $XXX June you coverage compliant facility million quarter, of was the bank ratio was X.XXx, our to As leverage

$XX.X gross goal the million capital on million, project million tower to $X.X continue spending ELSA related We growth spent ELSA the contribution a capital remains number, and to during to and we oleum Of projects. million was the with million X.XXx on which the on joint that includes $X.X of the venture. capital quarter below Our sustained a expenditures $XX.X work on $XX.X second basis leverage total toward that.

to a a in is CapEx $XX.X from business moment, in our projects: The million, X to approximately $XX.X total are to variety our for fertilizer our improvements are spend $X of Greece of related be additional City increase capital expenditures XXXX division one million. Seneca storage will majority other For the a up and which million. at is discuss million, for capacity facility Kansas our I in original we $XX.X budget which the increase to from at build adjusting our reasons, expected facility. our $XX.X Growth anticipated of now million

our business. increased the our by Services regulatory increased approximately side, CapEx plants in used costs Sulfur we incurred the and the fertilizer marine on at for have $X.X million On million anticipated $XX.X we equipment have inspection year to turnaround maintenance as higher the costs forecasted

barrel. as EBITDA the in anticipation Our terminals expense XXXX quarter results will guidance about that better, the today's reduced Resource the remains or call turn Conflicts to not we be Please from press the Management independent the $XXX.X MMLP in the for operator, is have questions Committee, actual million. offer direction though release we need the X shore-based but our made were slightly review the for not we call, we attached to of guidance maintenance those presentation I our full discussions received to adjusted moment, Hurricane earnings up inform XXXX of of first, discussions. to outcome will The speculate directors, to with group in will MRMC and which EBITDA taking guidance remains session a I Q&A you adjusted during back Martin yesterday buyout Even Corporation. related each impacts for individual year of business. In

topic. With from this to So any please questions refrain operator questions you that, may I'll have. over other the turn on for it

Operator

Akyol Stifel. We'll [Operator question from at Instructions]. take first our Selman

Selman Akyol

of on note than tower to to all, on chance timing? expected of first So sooner Any anything there? alpha, just there? in just everything terms track update Any

Randall Tauscher

Yes. Selman, is Randy. on this Everything track. is

middle at potential to we then potential of also of And plant oleum Oleum several August. We since begin and point, We it. processing times ELSA to customers. the the the in ship their timing end with that the the tie-ins anticipate -- and of will hasn't of the the will changed And tower beginning the testing middle venture and last by the July. plant speed the about with qualification spoke the and have in to complete them stock sales

Selman Akyol

in those Any then heard opportunity rates. marine, put in you to day any term on terms And I of Great. terms all? of contracts at of

Randall Tauscher

Yes.

spot some our have all first it early of year. sort of is into all third of to of getting us of much the the the us X and in next of the contracts. of the on getting the of quarter the we term, end It's market. end nothing contracts year quarter, Currently, some So through

been looking we do been so. the customers as wanting So the expand have to to term have

Selman Akyol

that Is update. of leak, to incident Great. any Or anything And beyond? all you? there going in to be pipeline bridge regulatory going behind terms that the is increased that's and Appreciate looks? is the linger then there

Randall Tauscher

Yes.

the spill, areas means maintenance by us. monitoring were So which happens now we that behind impacted which the could that the be bridge mid-May basically expect and that vision, that, in we're is mode,

went in happened earlier middle the the we in to this week, month, of remediation crude On last spill oil which from emergency mode Smackover, mode.

So do on of there. anything, in weeks some want have you insurance us add [ have on to we Bob, remediation ]. front the or still months did

Robert Bondurant

But full that not. to the have as both so do Well, economic we monitoring as situations. us, as accrued I deductible, more. impact said, is, don't be I there should No, really this, believe will of we Randy any add ongoing an far

Selman Akyol

Got and it. could just expand just maybe were then maybe impacted. little barrel And guys a it sounded you you on that bit? you to you alluded -- Can like

Randall Tauscher

That us Yes. over hurricane the hit to Houston area. Beaumont

our would facilities. Port maintenance in year, probably then and all We nonmaterial We hit damage it the in come be as But on have from have impact won't an that could sites to us work were did although financially several over bases down from that our it regard. at of operate week able that. I'd say, Houston and financially we Galveston impacted. but our the damage much, side see perspective, Arthur. And all our shore impact to customers different way at there, for nonmaterial I call have we'll I'd we entire how some being had shore-based which the say from that also in just locations, a the really through back

Robert Bondurant

impact we that refinery sulfur no And really statement? of production through storm. fair I'll add, that saw Is of a

Randall Tauscher

That's true.

then earlier, we second have -- third think under had the that Bob a which July, excuse and a tad anything tonnes in And we've me, day just Earl that. don't during As mentioned to quarter do I during the X,XXX quarter. with

Selman Akyol

of question my kind relates that it. And sort then of and last topic. it here, Got to just

this during In turnarounds, you terms turnarounds them do refinery expected? Or quarter? expect upcoming of anything no

Randall Tauscher

late any at point knowledge the us. impact We early in how have of Typically, quarter. would don't there third are turnarounds fourth quarter, the this turnarounds

Operator

take question & our We'll from May Company. next Kyle at Sidoti

Kyle May

to going just not buyout you're give was if potential but you events the any offer, I a wondering can time perspective, different maybe us information said you going know the about the I forward. of about talk line from Sharon,

Sharon Taylor

if negotiations those do negotiations don't to completing that can I are that know they those I I The Committee think MMLP's still will between that. anticipate occurring Conflicts on will agreement. time we nor do speak and not advisory a line come MRMC's be firm. be will have when on an occurring I if

speculate So I there. to like wouldn't

Kyle May

segment, And was the then really in transportation maybe out, pointed land transportation it. strong. Appreciate like you Understood.

maybe can think you experienced about of some you continuing if second and what third. quarter of how you the wondering in Just the on expand fundamentals in -- the that that

Randall Tauscher

the as Randy. is butane, and too, and bit, summer. one the has were we back chemicals little seasonally, the and in all a weak. the a is June, This saw work July, be bit then a the that way strong and June up And course, trend Yes. That's question a then would and picking May saw as heads lubricants propane around that both And slower of fabulous. through same little in is our and We year us were we we great ago, because our question June. commodities drop. across all to April board

the see was we'll tremendous. regard, the first In months. couple that things next over So of here week go July, how

The our acid bit, which all our do barrel ] tweaked we little by raw we've view a of their haul planned [ after down second truck. week materials plant, into had

down up August. in We June have months and and that had will coming July, be that back of

thinking see we're to so that business. as again an in August, uptick we And we might get

Kyle May

Great. really helpful. That's for last And X Okay. me.

leverage looking CapEx budget target ratio. year? the with update for the on about how higher yes, the -- thinking X.XXx you Just give ratio, that could an I if leverage sustained the of year, this you're you're know the exiting on sustained maybe wondering us

the Just progression about there. how you any see thoughts

Sharon Taylor

Yes.

right when at the we of X.XXx back now half year, about exit CapEx we'll are that think at level. consider we where the we think through the I the year same

Operator

at move to we'll Next, Patrick Baird. Fitzgerald

Patrick John Fitzgerald

there to expecting the kind is business? additional Yes, any you returns of of the out you're the investment about get way talk fertilizer could in

Randall Tauscher

Yes.

We're the to to going us the is months going in going now. -- and summer just winter warehouse -- Illinois fall do what complete is fertilizer. that's we that up area there is to make up because right the during that's So to about harder allow run a traditionally fertilizer early

bump expect expecting So to $XXX,XXX we we're from to $XXX,XXX hit. that, doing that and

quarter the fourth guidance. in I think quarter in put we -- the the fourth

Patrick John Fitzgerald

which right. million And just slide like quarter, puts you then I'm expect that cash could ramp looking $X.X to? like fourth the that $X.X last to in have you're at you beyond of to like there's how ELSA's in fourth the from kind upon of much guided operations. -- needs terms just online takes, remind Could And go of that EBITDA million All us then EBITDA remind in like you the more like quarter. the year additional from coming expecting you and the and how how to CapEx fourth out commencement of Okay. the in that quarter, into get us on all

that So just talk would if you that, could helpful. about be

Randall Tauscher

Sure.

pay the capital oleum us definitely in we that plan the had going to of sales up Marketing parties. to fee so is the that began spend will XXX,XXX-ish which that first the the And So reservation that the And begin has And we be we fourth we And when for there that between this XXXX. X tower be to revenue have and early back stream different for the. to will has the on in on to fee could the we're you that them feedstock the ramp streams, ramping providing will secure marketing the by per building. And venture agreements. think see a get then some year, that's on be will sales venture begin actually as those X October. be second the processing we And in and quarter, the currently yet second some half would the for a sales in to for might partnership for up ramp up. -- plan in quarter provide XXXX.

course, at investment point, that percentage on contingent revenue seeing that's venture, and of the capital the we're start when and expect million, getting ultimately, built sales into our venture. on operating. And expect and a to capital the we'll And to ELSA $X $XX of the then which pick share total front the up of million our Now investment fab the total clients $XX putting be was million the venture. $X to million we we the

Sharon Taylor

approximate that on spoke oleum additional there. have to an quarter. through tower, million And I'll joint contribution left $X The this far venture the million to, $X.X as you add was that the spent on That we that project. the was ELSA itself. as

Operator

back remarks. that turn And I to to closing would session. for over concludes like conference Q&A Bondurant Bob the our

Robert Bondurant

call appreciate DSM beginning today. Thanks have ribbon-cutting partners pleased Samsung I final on Audra. ceremony forward just very look to we DongJin, note, production everyone facility a you, our And Semichem were soon. the the the with to thank at for on and Well, a Monday plant again.

Operator

today's participation. concludes this conference And for your call. Thank you

disconnect. now may You

Martin Midstream Partners (MMLP) 18 Jul 242024 Q2 Earnings call transcript