MMLP - Earnings call transcript Q3 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 Third Quarter Earnings Conference 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

thank call and everyone us joining Good you the today. on morning, to

the Bondurant, of Here COO; are room in Bob Controller; Danny David CEO; and Cavin, Director FP&A. Cannon, Tauscher, Randy

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

financial comparable release press financial We on will includes measures financial these discuss GAAP to measures. of a non-GAAP The today's non-GAAP call. earnings their measures reconciliation

And earnings. to with that, I discuss third over to Bob will turn it quarter

Robert Bondurant

Sharon. Thanks,

First, I our our begin on the regarding and people Milton comments assets. of with Hurricane impact on would like to

who operations members hours landfall. team and Central were people And themselves safety. for. Tampa a reposition safe to manage down are and trucking XX operations Martin Our in terminal and Florida shut We our result, accounted more all our than both our operate as before able to

terminal which tank our no surge the will storm Tampa assets, had and of repaired. infield farm our Regarding submerged our rain be our filled issues, but several heavy pumps,

be that also to tank repaired. damage insulation also some will have We need

to people we feel locations. minor very had and experienced all, to terminal very minimal in located our have trucking Our Mulberry All only in blessed our to impact damage.

on our quarter like would performance. overall third I Now to operating focus

adjusted quarter, third million. million of $XX.X guidance had to EBITDA million For guidance we of short third $X.X $XX.X quarter we compared of as by the fell

long-term incentive press fair of increase yesterday's to tied expense plans, primary our the in common contributor an which was market release, in our units. related guidance mentioned shortfall to are the I value As to our

an to million recognized we result, compared additional a expense when in $X.X As guidance.

have by million. million. this recognition, Without segment impacted to and $X.X our would Sulfur Products Terminalling Services million million. Storage compared $X.X by and by our our expense this our Both guidance Specialty we transportation forecast impact expense $X.X The negatively by recognition of and exceeded when segment segments each $X.X

I our down to adjusted performance Now would break each by EBITDA segment. like

of and was segment, business the For EBITDA generator will of once our a million. segment, of had million. Land stability our believe guidance $XX.X very transportation guidance Transportation this which quarter fourth this cash third continue quarter, in this business. $X.X our $XX.X to the quarter had stable adjusted $X.X million in We had adjusted largest flow Within to compared of EBITDA again million compared

Our EBITDA $X.X guidance Marine Transportation to of adjusted million $X.X of compared had business million.

While target inland our X%. forecast forecasted day with guidance, our average utilization was on exceeded by rate

in expect We to and this in see to due result, market rates flow as a business stability the fourth line in the tightness stable continued inland cash in quarter.

in EBITDA compensation the was our be can charge, missing our Storage attributed had Terminalling million million. with which segment, Terminalling generator the of entirely third line flow cash guidance. quarter segment to The guidance adjusted this of guidance and strongest to next Our increased million. $X compared incentive Without in $X.X was of $X.X and expense Storage

and for we the operations toward fourth Storage stable and both will Looking adjusted segment. believe remain Terminalling quarter, our EBITDA

adjusted segment, Products miss generator which Our $X.X third of compared guidance largest Specialty was $X.X our had to of million a cash of $X.X EBITDA flow million, million.

weaker grease $X.X million, U.S. the weak we and packaged being their demand groups economy. performance business result million. charge products our weak by from missed guidance believe forecasted. was this compensation is saw incentive slowing miss expense of We driven primarily both long-term for than Excluding This $X.X by demand lines. lubricant the Both of the

the quarter, combined in the the seasonal grease in fourth economy other fourth cash quarter the X flow softer toward and relative overall should with for weaker Looking products the result our reduced lubricant to demand quarters.

outperformance would sulfur our like million million, would segment, Gulf Finally, compared to in logistically the compensation sulfur this per of of to adjusted of $X.X the performance The segment $X.X I of to Sulfur tons XX% guidance strong of refinery by had Beaumont discuss EBITDA was handled adjusted forecast production $X.X our from $X.X sulfur EBITDA long-term manage million our Sulfur of approximately The sulfur of incentive-based volume guidance guidance this day we of our customers. segment Services volume of exceeded was into have side charge had our we of which greater million. Without pure $X.X driver Coast or Services production the as X,XXX compared $X.X terminals. of primary than million. The through million. daily

unexpected levels should sulfur in subject sulfur refinery any optimistic turnarounds, fourth refinery of the to at the or which achieve our continue higher toward to that these us the will side remain from business. remain Looking quarter, pure to allow production customers we guidance exceed

fertilizer Our the $X.X of quarter. $X.X group which adjusted million for than million third less EBITDA EBITDA had was guidance

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

quarter, quarters fertilizer anticipate seasonal normal and Looking the toward the in to the cash relative fourth trough business. second flow first we for the

to the with like transaction Management Resource turn a pending call Martin our I regarding Corporation. would few Sharon, comments I make over Before to

MMLP will deliver robust than proposal. of XX, directors nearly which an transaction the pending by negotiated the $X MRMC committee unit and initial XXXX, and unaffiliated on independent more buyout on value. and advisers. financial A maximize which per legal our reviewed to process The independent initial assisted hard Board's approached unitholders May ensued As was the by you was behalf consists with proposal know, X Committee of Conflicts

the forward unitholders follow to secure look to more transaction with necessary In with and as the a will to we we ahead, we proxy the work engaging approvals complete detail weeks the statement transaction. on

forward all you we share more information proxy the transaction. keeping filed, no updated to have to the until regarding While pending is we look

As focus We operational such, the focused will of quarter that and keep please performance. today ask questions financial our our on performance. third call you on our be

call turn to I'll the Now Sharon. back over

Sharon Taylor

Thank you, Bob.

remaining long-term XXXX. total September our outstanding XX, under which due our million of revolving second the was lien of million consists was February our As XXXX, $XX.X of and notes million $XXX.X $XXX XX.X% facility, credit drawn debt

our credit of was approximately facility million, issued $XX.X revolving including capacity borrowing credit. a reduction under $XXX of approximately available for letters million Our $X.X million

quarter, of end Our bank leverage ratio compliant X.XXx. X.XXx and at was coverage interest was adjusted the the

our both August debt coupled While on interest reduces needs, debt outstanding to the payment remain capital debt with at leverage leverage our notes total exiting committed adjusted increased and adjusted year below from our working anticipate that to reduction level the to we second the due outstanding a quarter and Xx.

of primarily maintenance in million, CapEx. at or of covenants, to tower and expansion expansion At in the banking the Texas, our venture. consisting third associated expenditures plants. compliance CapEx were costs CapEx all the the our majority Capital The with million of of $XX.X during oleum was to full of quarter end in the in the in the The otherwise. related $X.X was maintenance with partnership inspection $X.X fertilizer quarter regulatory in and support was ELSA on CapEx improvements turnarounds joint Plainview, million marine equipment quarter,

second which expenditures quarter capital year $XX.X tower currently full XXXX $XX.X improvements the venture. year either or full to million, maintenance the from to to now for contributions full joint our ownership be call. forecast conference $XX.X and million million for down of JV We through $XX.X previous ELSA the expansion CapEx Our cash during totals discussed anticipate the year $XX.X for million the be XX% CapEx million includes oleum

Bob overall, allowing million. EBITDA maintain partnership adjusted the As full us quarter, year well our for the of performed XXXX guidance to $XXX.X discussed, in third

Services quarter, Marine For we divisions. the adjusted both the for slightly fourth forecast and our Sulfur have

guidance XXXX our reportable earnings individual adjusted yesterday's find business each You will in segments for attached our to press EBITDA the presentation X under release.

to turn over and remarks will for That back I concludes for Q&A. my today, it Audra

Operator

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

Timothy O'Toole

on appreciate you I my This Selman. is call. taking for Tim

wanted start all are off personnel just in But cash have wanted that the any needs implications okay. for I glad damage I'm from I and the Florida, allocated kind there? the assets So to update, to of fix potentially some to remainder and as the to capital appreciate of this just will those the if any be kind far year and of minor of as see flow

Randall Tauscher

Tim, this is Randy.

to have damage installation the did going terminal of Tampa to be are a sustain Our tanks. of repaired. bit of Pumps some little

and So the we're than first CapEx much don't $X.X outlay quarter fourth that, going impact Other $X expect somewhere over expenses. have to between to commercially. million quarter of and we a cover those million

Timothy O'Toole

I it. over And then I that. Got to jumping ELSA. guess appreciate

updates wanted of potential out from been indications for that Samsung to on prospects everything other on any still any there And get Just track? has then growth there, future JV?

Randall Tauscher

Yes.

It the ELSA in call to July. So is was hasn't taking the take supposed taken yet. plant feedstock talked to soon provide to Martin it. about in as We feedstock DSM ready the last We're ready August. that as begin from feedstock

We be expect of to month that October. within the

week. this not told I'm but -- So

of and the to processes So testing their ELSA, with it taking start next customers. the improving qualifying and that's producing feedstock, whole week, it should start be the process ready to the going ELSA, then

imminent. that is So

it I of be delayed thought we think terms be. the was likely from is the program what to going sales to In program, sales

articles out announcements for You've We've there seen some probably delays. on news the seen that. public

sales commercial hoping we be. not as the in see robust going were discussion development, around they to to not need first. much be probably to probably plant that think we there's as And XXXX would I make this next is plant going because sure until be are we

Robert Bondurant

to does that likely one a have a be more fee But Randy's begin will muted the actual X for add to most customers while. I'll October of And that reservation the will earned. comment ELSA be that we sales is the point, do

Timothy O'Toole

that Understood. currently updates what certainly have the but rates contracting outperformed, and kind there? just to And then there, and it's any highlighted barge curious of I to you're guess, for on business kind guys turning strength of you seeing

Randall Tauscher

Yes.

the to So clean day, was and it currently on is a a year of where which $XX,XXX to par ago a the day, $XX,XXX currently is ago. thousand of year greater dollars $X,XXX rates a are than $X,XXX couple per are was which it rates

now seen So in a we've heated in seeing the those business to that quarter months. winter well least and rise see continuing the the first stable don't at now. rates But continued rise last year They've expect we do rates through are We've stable rates. is we over unit the fourth What out. a the clean quarter. rates. for We very seen market to the stabilized in the

into the tows XX% of terms up have the of tows dock. Other we term of In in we locked of on than our term rates, XXXX. dry one our had that, third-party

think X, The have are term a rest I of some its those remaining contract are our during some yet and days, is on to of XX months next remaining. on those long, those XX XX% the And XX that coming rates of then were end negotiated. fleet spot. we are them or of being

Timothy O'Toole

And one guys it inside kind proposed I a But last holders a vote be the Or majority? you the it. could. can't majority of understand one, if of it. outside Got be And merger, ownership? the will just then will simple if of regarding I answer

Sharon Taylor

simple majority be That Yes. a vote. will

Operator

We'll to move May next Sidoti. Kyle at

Kyle May

just appreciate given if we're for probably can thoughts it's needed soon I preliminary give capital in capital any year, getting ELSA. the but spend formal wondering for wrapped So guidance XXXX next us you too on just up about

So curious about year. preliminary just of kind next thoughts

Randall Tauscher

Yes.

now capital but So spend we dollars the as The ELSA be of right I somewhere a refinery $X gotten less we few significant budgeting will still the we year. going tell perspective, done from and to a because yet. a we has turnaround we -- and to really this growth maintenance in think perspective, haven't not believe haven't have our on what as ballpark near of a everything year process ELSA. will next saw as we committed From that have you, to million year, planned for the to next with shipyard barges project. don't I

talk this be that enough $XX.X don't think with -- that to would looks to we I the that. would achieve like we haven't certainty under around going So million we're year. But done any yet we

Kyle May

kind your you an then helpful. give Martin. indicated us slowdown $X good that amount, you're that another Okay. annual Great. And about next ELSA outlook total it's That's question a operational, then for first progression Can rate? the basis project. previously, that figure. full million how million on it fully on on I that the year, still just And maybe $X that you've could to with an it's once generate fully is believe run on about once operational, thinking of update

Randall Tauscher

Yes.

this the in the So we get as with gets would the value ran consumers, other reservation reservation the about price would fee Bob value When month. we the commented, we're come and And come the in the originally of project then the XX% sales depending starting upon volume sold to XX% getting the XX% the sell. ultimate the ELSA. ELSA economics when to fee we to XX% and would

to in Samsung are this, our feed year. So with budget yet relying I XXXX. for have relying next good that remember, our minority We we're information. -- us on their working would information we're around say marketer, what expectations a we're don't We're for XXXX, on again,

Operator

next Patrick at to move We'll Baird. Fitzgerald

Patrick John Fitzgerald

the So going implies so the fair? of borrowings the guidance have the Is about million I that to guess you're revolver end that or of year. on $XX at

Sharon Taylor

Yes.

going somewhere year-end. at million I think million and to $XX-ish end between we're $XX up

Patrick John Fitzgerald

-- and in the cash projects. flow commentary guess, outlook, then I Okay. last no CapEx question But your given about free the major

be will Is generation flow that cash free fair? in Your improved XXXX.

Sharon Taylor

that's but neighborhood we out probably projections well, think haven't million. our -- Yes, sir, got somewhere there, the of in fair. $XX We

Patrick John Fitzgerald

just the Awesome. on financing. And then acquisition

there's the out of think there how I to debt it structure. confusion relates MMLP some

mean, prohibited, I maybe question that's MMLP just and really that financing this, talk if about could just but think a be but So helpful. if how would could you that like the be you it I -- impacts don't would

Sharon Taylor

Sure.

capital transaction is As should after the our far as structure level MMLP MMLP, nothing change to at closed, close. the will it related

So either is 'XX. for X credit don't anything changing remains credit our in the our But facilities. and notes consideration -- I there the we mature outstanding. those believe matures remain And within at in 'XX outstanding facility notes no moment facility this and of

Patrick John Fitzgerald

you're not anything at right? the MMLP borrowing acquisition, And help to finance

Sharon Taylor

correct. That's not. No, we are

Patrick John Fitzgerald

like Refinery, I is more be, think, resource relationship guess, the just you I your a only the because the -- on, the And potential bit a guess levered? one Martin I Okay. headwind would of -- have Smackover little

Sharon Taylor

I question, go I'm not to back I'll the sure understand the contracts. but

have of then MMLP's will and have negotiated on side, continue be numerous contracts to prior effective outstanding MRMC are this And and approval. have with buyout. be We outstanding. between Those the for to MMLP committee that deal their they and MRMC through the own conflicts been the will finalization gone have financing, which

Patrick John Fitzgerald

And would All with that increased could work? up their how cash of need distribute the -- would kind that MRMC right. what deal to they or so a then be there to be financing

Sharon Taylor

under current revolving are the notes. of So facility is the at or able a to, and that the MRMC the depending as the choose on they sole make not of unitholder we constraints credit MRMC the MMLP are whether should which would time, recipient to unitholder be under able indenture or vote, to closes, subject when deal any when again, our to distributions that

Operator

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

Robert Bondurant

until we'll I'd in closing, for weeks provide to which agreement the Circling again, participating information that our filed, statement call Thanks and great on like the to thank have But a day. a again have detail file MRMC, back the will In you is no transaction. I'll proxy we share. with coming we to the reiterate in today. merger more more proxy

Operator

today's concludes for your conference call. you thank participation. This Again,

now may You disconnect.

Martin Midstream Partners (MMLP) 17 Oct 242024 Q3 Earnings call transcript