KILGORE, Texas, May 4, 2011 (GLOBE NEWSWIRE) -- Martin Midstream Partners L.P. (Nasdaq:MMLP) announced today its financial results for the first quarter ended March 31, 2011.
Martin Midstream Partners L.P. ("the Partnership") reported net income for the first quarter of 2011 of $7.1 million, or $0.30 per limited partner unit. This compared to net income for the first quarter of 2010 of $1.8 million, or $0.04 per limited partner unit. Revenues for the first quarter of 2011 were $283.0 million compared to $242.7 million for the first quarter of 2010.
For the quarter ended March 31, 2011, net income was negatively impacted by $0.5 million, or $0.02 per limited partner unit, in non-cash derivatives net losses from certain commodity and interest rate hedges that are subject to mark-to-market accounting,
The Partnership's distributable cash flow for the first quarter of 2011 was $12.5 million. Distributable cash flow is a non-GAAP financial measure which is explained in greater detail below under "Use of Non-GAAP Financial Information." The Partnership 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.
Included with this press release are the Partnership's consolidated financial statements as of and for the quarter ended March 31, 2011 and certain prior periods. These financial statements should be read in conjunction with the information contained in the Partnership's Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on May 4, 2011.
Ruben Martin, President and Chief Executive Officer of Martin Midstream GP LLC, the general partner of Martin Midstream Partners, said, "The Partnership's distributable cash flow coverage as viewed on a trailing twelve-month basis remains healthy. Further, our outlook is strong given the additional cash flow we anticipate in the coming quarters. On that basis, our board of directors voted to increase our distribution to unit holders for the second consecutive quarter. Looking ahead, our new ammonium sulfate plant came on line in mid-March of this year. Built on a low cost multiple, we expect strong performance from this new asset given the high demand from agricultural sources. Elsewhere, we have begun to conceptualize logistic chains for customers who expect high future liquid transport needs from Eagle Ford shale production. We believe we can play a meaningful role given our terminalling assets and marine transportation expertise.
"Now, let me discuss our first quarter coverage of .84 times. Although this is below our expectations, we can reconcile the performance back to our forecast and affirm that the Partnership is well-positioned for stronger coverage in coming quarters. Several factors were present during the quarter that adversely affected our distributable cash flow. First, our maintenance capital expenditures of approximately $7.3 million in the first quarter reflects nearly half of the anticipated expenditures for 2011. As previously mentioned, we have forecasted abnormally high maintenance expenditures for the year driven primarily from our marine equipment. During 2011, our entire off-shore barge fleet has scheduled or completed regulatory dry-docking work-overs. To date, approximately two-thirds of the marine equipment work-overs have been completed. Secondly, our terminalling and storage segment experienced a weaker than expected quarter due to higher than expected operating expenses for our specialty terminals. Also, we experienced lower than anticipated through-put volumes at our marine shore base terminals as a result of weaker offshore drilling activity. Activity levels during the quarter improved due to increases in new deep water offshore permits issued after BOEMER. Through-put volumes have been stronger during March and April as the overall Gulf of Mexico activity increases coming out of the winter months.
"In conclusion, I am pleased to announce that in mid-April, we successfully closed a new upsized revolving credit facility. We saw very good demand in the bank market and were able to achieve improved pricing and structure. We expect the new credit facility will have a positive impact on our distributable cash flow of approximately $2.0 million annualized versus our previous bank facility. The facility gives MMLP ample liquidity and flexibility for continued growth."
Investors' Conference Call
An investor's conference call to review the first quarter results will be held on Thursday, May 5, 2011, at 8:00 a.m. Central Time. The conference call can be accessed by calling (877) 878-2695. An audio replay of the conference call will be available by calling (800) 642-1687 from 11:00 a.m. Central Time on May 5, 2011 through 10:59 p.m. Central Time on May 19, 2011. The access codes for the conference call and the audio replay are as follows: Conference ID No. 63291052. The audio replay of the conference call will also be archived on the Partnership's website at .
About Martin Midstream Partners
Martin Midstream Partners is a publicly traded limited partnership with a diverse set of operations focused primarily in the United States Gulf Coast region. The Partnership's primary business lines include: terminalling and storage services for petroleum products and by-products; natural gas gathering, processing and NGL distribution; sulfur and sulfur-based products processing, manufacturing, and distribution; and marine transportation services for petroleum products and by-products.
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 Partnership'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
The Partnership reports its financial results in accordance with United States generally accepted accounting principles (GAAP). However, from time to time, the Partnership uses certain non-GAAP financial measures such as distributable cash flow because the Partnership's 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 Partnership's cash available to pay distributions. Distributable cash flow should not be considered an alternative to cash flow from operating activities or any other measure of financial performance in accordance with GAAP. Distributable cash flow is not intended to represent cash flows for the period, nor is it presented as an alternative to income from continuing operations. 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, the Partnership 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 Partnership 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. The Partnership calculates distributable cash flow as follows: net income (as reported in statements of operations), plus depreciation and amortization, amortization of debt discount and amortization of deferred debt issue costs (as reported in statements of cash flows), less deferred taxes (as reported in statements of cash flows), less payments of installment notes payable and capital lease obligations expenditures (as reported in statements of cash flows), plus distribution equivalents from unconsolidated entities (as described below), less invested cash in unconsolidated entities (as described below), less equity in earnings of unconsolidated entities (as reported in statements of operations), plus non-cash mark-to-market on derivatives (as reported in statements of cash flows), less payments for plant turnaround costs (as reported in statements of cash flows), less maintenance capital expenditures (as reported under the caption "Liquidity and Capital Resources" in the Partnership's Quarterly Report on Form 10-Q filed with the SEC on May 4, 2011), plus unit-based compensation (as reported in statements of changes in capital).
The Partnership's distribution equivalents from unconsolidated entities is calculated as distributions from unconsolidated entities (as reported in statements of cash flows), plus return of investments from unconsolidated entities (as reported in statements of cash flows), plus distributions in-kind from unconsolidated entities (as reported in statements of cash flows). For the quarter ended March 31, 2011, the Partnership's distributions from unconsolidated entities, return of investments from unconsolidated entities and distributions in-kind from equity investments were $0.0 million, $0.1 million and $3.9 million, respectively.
The Partnership's invested cash in unconsolidated entities is calculated as distributions from (contributions to) unconsolidated entities for operations (as reported in statements of cash flows), plus expansion capital expenditures in unconsolidated entities (as reported under the caption "Liquidity and Capital Resources" in the Partnership's Annual Report on Form 10-K filed with the SEC on March 2, 2011). For the quarter ended March 31, 2011, the Partnership's distributions from (contributions to) unconsolidated entities for operations and expansion capital expenditures in unconsolidated entities were ($3.7) million and $2.2 million, respectively.
Additional information concerning the Partnership is available on the Partnership's website at .
CONTACT: Joe McCreery, Vice President - Finance and Head of Investor Relations, Martin Midstream Partners L.P. Phone (903) 812-7989 joe.mccreery@martinmlp.com