Martin Midstream Partners L.P. (NASDAQ:MMLP) Q4 2023 Earnings Call Transcript

Martin Midstream Partners L.P. (NASDAQ:MMLP) Q4 2023 Earnings Call Transcript February 15, 2024

Martin Midstream Partners L.P. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

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 Fourth Quarter Earnings Conference Call. Today's conference is being recorded. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. [Operator Instructions] At this time, I'd like to turn the conference over to Sharon Taylor, Chief Financial Officer. Please go ahead.

Sharon Taylor: Thank you, operator, and good morning everyone and thank you for joining us today. In the room are, Bob Bondurant, CEO; Randy Tauscher, COO; David Cannon, Controller; and Danny Cavin, Director of FP&A. I'll begin with our cautionary statement. During this call, management may be making forward-looking statements as defined by the SEC. These statements are based upon our current beliefs, as well as assumptions and information currently available to us. Please refer to our press release issued yesterday afternoon, as well as our latest filings with the SEC for a list of factors that could impact the future performance of Martin and cause our actual results to differ from our expectations. We will discuss non-GAAP financial measures on today's call, such as, adjusted EBITDA, distributable cash flow and free cash flow.

In addition, we will refer to adjusted EBITDA after giving effect to the exit of the butane optimization business. You will find a reconciliation of these non-GAAP measures to their nearest GAAP measures in our earnings press release posted on our website. Now, I will turn the call over to Bob to discuss fourth quarter and full year results. Presenter Speech

Oil and natural gas pumps glowing in the sunrise, symbolic of the company's power.

Bob Bondurant: Thanks, Sharon. I would now like to begin my discussion with a recap of Martin Midstream Partners execution of significant achievements in 2023. In February, we refinanced our existing secured notes, extending their maturity to February 2028. At the same time, we amended our revolving credit facility and extended its maturity to February 2027. In the second quarter of 2023, we completed our exit from the volatile butane optimization business, while retaining the stable cash flow component of the business associated with our North Louisiana underground storage assets. Also in 2023, we began construction of the Oleum Tower at our sulfuric acid plant in Plainview Texas in order to be the supplier of Oleum to the DSM Semichem joint venture.

This joint venture is between us, Samsung, C&T America Inc. and Dongjin, USA. The joint venture is currently in the construction phase of facilities that will provide electronic-level sulfuric acid commonly known as ELSA to the semiconductor manufacturing industry. The final significant achievement we had in 2023 was exceeding our disclosed EBITDA guidance and also meeting our targeted leverage ratio of 3.75 times. I would like to acknowledge and thank our team of executive leadership, segment leadership and the entire Martin Midstream workforce for executing our 2023 game plan in order to achieve these goals. Now, I would like to focus on our fourth quarter operating performance. For the fourth quarter, we had adjusted EBITDA of $29.2 million compared to a fourth quarter revised guidance of $26.9 million, an improvement over guidance of $2.3 million or 9%.

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