Martin Midstream Partners L.P. Q2 FY2024 earnings call

• Bob discussed second quarter operating performance, exceeding guidance by $0.5 million despite $2 million in casualty losses. Segmented performance by each business unit, including Transportation, Marine, Sulfur Services, Terminalling, and Specialty Products. - Sharon talked about balance sheet as of June 30, 2024, with long-term debt at $458 million, revolving credit facility balance at $58 million, and adjusted leverage ratio at 3.88 times. CapEx spent $20.2 million in Q2, with adjusted 2024 CapEx to $58.4 million. - Mentioned no Q&A on the buyout offer from Martin Resource Management Corporation, with MMLP Conflicts Committee in discussions.

For the second quarter, the Transportation segment was the largest cash flow generator with adjusted EBITDA of $11.2 million vs. guidance of $10.2 million. Within Transportation, land transportation had adjusted EBITDA of $8.2 million vs. guidance of $6.5 million, with revenue exceeding forecast by $1.4 million due to 5% higher mileage. Marine Transportation had adjusted EBITDA of $2.9 million vs. guidance of $3.8 million, impacted by a $0.5 million casualty loss and lower inland fleet utilization. Sulfur Services: Fertilizer group had adjusted EBITDA of $6.7 million (in line with guidance), pure sulfur side had $3.8 million vs. guidance of $3.1 million due to strong sulfur production. Terminalling and Storage had adjusted EBITDA of $8 million vs. guidance of $9.4 million, missing due to a crude oil spill casualty loss. Specialty Products had adjusted EBITDA of $5.7 million vs. guidance of $5.6 million, with grease outperforming and packaged lubricant underperforming.

• Third quarter performance expected to approximate guidance. - 2024 adjusted EBITDA guidance remains $116.1 million, with adjustments for segments like shore based terminals due to Hurricane Beryl. - Growth CapEx now expected at ~$23.1 million, maintenance CapEx increased to $35.3 million. - Leverage goal remains below 3.75 times on a sustained basis.

• Casualty losses in Marine Transportation (bridge allision) and Terminalling and Storage (crude oil spill) totaling $2.5 million. - Impact of Hurricane Beryl on Houston sites and shore bases, potentially affecting shore based revenue. - Substitution of higher cost third party base oils in Specialty Products' packaged lubricant business driving up unit costs.

Q: Any update on ELSA timing?

A: Oleum tower and tie-ins to ELSA plant complete by end of July, beginning to ship in mid-August.

Q: Marine contracts, any term opportunities?

A: All contracts on term, some through end of year, others into early next year, with customers wanting to expand terms.

Q: Bridge incident and crude oil spill regulatory looks?

A: Bridge allision in maintenance mode, crude oil spill in remediation mode, ongoing monitoring.

Q: Impact of Hurricane Beryl?

A: Nonmaterial maintenance impact, some potential shore based financial impact, no impact on refinery sulfur production.

Q: Refinery turnarounds in upcoming quarter?

A: Typically late third quarter/early fourth quarter, no current knowledge of impact.

Q: Leverage ratio progression?

A: Current at 3.88 times, expect to exit year at similar level despite higher CapEx.