Martin Midstream Partners L.P. Q1 FY2024 earnings call

• Overall first quarter operating performance: Adjusted EBITDA was $30.4 million, a $1.2 million miss vs guidance. Transportation segment's land transportation had $1 million revenue excess due to 8% higher mileage; marine transportation had $0.8 million revenue excess. - Terminalling and Storage segment had $0.5 million expense overage due to refinery restart costs. - Sulfur Services: Fertilizer group had $2.4 million miss due to lower margins despite 11% higher sales volume; pure sulfur side had miss due to reduced refinery volumes. - Specialty Products: Packaged lubricant business underperformed due to operating issues in January, but corrective actions taken. - Second quarter outlook: Transportation business lines potential to outperform; terminalling group expected to perform at forecast; fertilizer business has margin headwinds; pure sulfur side expected to meet forecast; Specialty Products segment expected to meet guidance. - Balance sheet: Total long-term debt $450 million, revolving credit facility balance $50 million, total liquidity $101.4 million. 2024 adjusted EBITDA guidance maintained at $116.1 million despite first quarter miss.

For the first quarter, adjusted EBITDA was $30.4 million. Transportation segment was the largest cash flow generator with adjusted EBITDA of $13.2 million (land transportation: $9 million vs guidance $7.1 million; marine transportation: $4.2 million vs guidance $3.1 million). Terminalling and Storage segment had adjusted EBITDA of $9 million vs guidance $9.4 million. Sulfur Services segment: fertilizer group $4.2 million vs guidance $6.6 million; pure sulfur side $2.5 million vs guidance $3.2 million. Specialty Products segment had adjusted EBITDA of $5.4 million vs guidance $6 million.

• Maintained 2024 adjusted EBITDA guidance of $116.1 million. - Shift in forecasted earnings between segments: Higher earnings for transportation and sulfur segments offset by competitive pressure on fertilizer and refinery turnarounds affecting sulfur services in first quarter.

• Competitive pressure on fertilizer business. - Extended refinery turnarounds reducing sulfur services volumes in first quarter. - Operating issues in packaged lubricant business in January.

Q: Asked about rate environment for marine and land transportation, and difference in 1Q vs 2Q guidance.

A: Marine rates up 50% over 2 years, currently locked in term; land transportation rates stable with some fluctuations. 2Q transportation business potential to outperform guidance.

Q: Inquired about fertilizer business outlook change, driving factors.

A: Small growth investment in Senate Cap warehouse for expanded operations into summer months.

Q: Asked about Samsung's second chip factory and DSM Semichem joint venture.

A: Unknown size of second factory, but potential upside; ELSA project sales expected in second half of 2025, oleum tower completion by Oct 2024.

Q: Followed up on marine dry dock, number of barges, and ELSA timeline.

A: 2 barges in dry dock in 2Q, most maintenance done by end of 2Q; ELSA sales expected in second half of 2025, oleum tower to start reservation fee by Oct 2024.

Q: Asked about turnaround expenses, unusual aspects.

A: Heavy turnaround year, inflation part of it; $32 million budgeted, $24.5-$26.5 million spent by end of 2Q due to refinery and marine maintenance.