1 Martin Midstream Partners L.P. Third Quarter 2020 Earnings Summary October 21, 2020 Disclaimers Use of Non-GAAP Financial Measures This presentation includes certain non-GAAP financial measures such as EBITDA and Adjusted EBITDA. These non-GAAP financial measures are not meant to be considered in isolation or as a substitute for results prepared in accordance with accounting principles generally accepted in the United States (GAAP). A reconciliation of non-GAAP financial measures included in this presenta ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2020 OR TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number 000-50056 MARTIN MIDSTREAM PARTNERS L.P. (Exact name of registrant as specified in its charter) (State or other jurisdicti ...

PART I – FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The Partnership achieved net income of **$8.8 million** in Q1 2020, facing asset declines and debt reclassification that raise going concern issues [Consolidated and Condensed Balance Sheets](index=4&type=section&id=Consolidated%20and%20Condensed%20Balance%20Sheets) Balance Sheet Summary (in thousands) | Account | March 31, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Total Current Assets** | $127,469 | $181,364 | | **Total Assets** | **$612,199** | **$667,156** | | **Total Current Liabilities** | $448,914 | $107,280 | | **Long-term Debt, net** | $165,543 | $569,788 | | **Total Liabilities** | $641,700 | $703,352 | | **Total Partners' Capital (Deficit)** | $(29,501) | $(36,196) | - Total current liabilities increased significantly from **$107.3 million** to **$448.9 million**, primarily due to the reclassification of long-term debt maturing in February 2021[14](index=14&type=chunk)[54](index=54&type=chunk) [Consolidated and Condensed Statements of Operations](index=5&type=section&id=Consolidated%20and%20Condensed%20Statements%20of%20Operations) Statement of Operations Summary (in thousands, except per unit amounts) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | **Total Revenues** | $198,883 | $240,033 | | **Operating Income** | $15,600 | $9,606 | | **Net Income (Loss)** | $8,815 | $(3,656) | | **Limited Partners' Interest in Net Income (Loss)** | $8,584 | $(3,581) | | **Net Income (Loss) per Unit - Basic** | $0.22 | $(0.09) | - The Partnership reported a net income of **$8.8 million** in Q1 2020, compared to a net loss of **$3.7 million** in Q1 2019, despite a **17%** decrease in total revenues. The improvement was driven by lower cost of products sold and a **$3.5 million** gain on the retirement of senior unsecured notes[17](index=17&type=chunk) [Consolidated and Condensed Statements of Cash Flows](index=11&type=section&id=Consolidated%20and%20Condensed%20Statements%20of%20Cash%20Flows) Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | **Net Cash from Operating Activities** | $44,889 | $40,603 | | **Net Cash used in Investing Activities** | $(6,295) | $(33,946) | | **Net Cash used in Financing Activities** | $(41,382) | $(6,730) | | **Net Decrease in Cash** | $(2,788) | $(73) | - Cash from operations increased to **$44.9 million** from **$40.6 million** YoY. Cash used in investing activities decreased significantly due to the absence of acquisitions in Q1 2020, which amounted to **$23.7 million** in Q1 2019. Cash used in financing increased due to higher net payments of long-term debt[28](index=28&type=chunk)[202](index=202&type=chunk)[203](index=203&type=chunk) [Notes to Consolidated and Condensed Financial Statements](index=13&type=section&id=Notes%20to%20Consolidated%20and%20Condensed%20Financial%20Statements) - The COVID-19 pandemic has impacted performance, leading to triggering events for impairment testing. This resulted in impairment charges of **$4.4 million** related to long-lived assets in Q1 2020[36](index=36&type=chunk)[37](index=37&type=chunk) - The **7.25%** senior unsecured notes due February 2021 have been reclassified as a current liability. The amended revolving credit facility's maturity accelerates to August 19, 2020, if these notes are not refinanced. This situation has raised substantial doubt about the Partnership's ability to continue as a going concern[57](index=57&type=chunk) - In March 2020, the Partnership repurchased **$9.3 million** of its 2021 Notes on the open market, resulting in a gain on retirement of **$3.5 million**[58](index=58&type=chunk) - On April 22, 2020, the Partnership declared a quarterly cash distribution of **$0.0625** per common unit for Q1 2020[132](index=132&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=40&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the COVID-19 pandemic's adverse impact on demand, noting revenue declines but increased operating income, and reiterates critical liquidity challenges - The COVID-19 pandemic has negatively impacted performance starting in February 2020 and is expected to continue affecting results throughout the year due to reduced demand for refined products. The company anticipates downside risk in its packaged lubricant, land transportation, and butane optimization businesses[141](index=141&type=chunk)[142](index=142&type=chunk) - The Partnership has been executing a strategy to strengthen its balance sheet by divesting non-core assets, resulting in a debt paydown of **$300.5 million**. Additionally, the annual cash distribution was reduced by **$0.75** per unit, retaining **$29.2 million** annually to further support the balance sheet[147](index=147&type=chunk) Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Net income (loss) | $8,815 | $(3,656) | | EBITDA from Continuing Operations | $34,326 | $24,510 | | **Adjusted EBITDA from Continuing Operations** | **$31,044** | **$25,619** | | **Distributable Cash Flow from Continuing Operations** | **$18,297** | **$4,753** | [Results of Operations by Segment](index=45&type=section&id=Results%20of%20Operations%20by%20Segment) - **Terminalling and Storage:** Operating income fell to **$1.0 million** from **$5.1 million** YoY, primarily due to decreased throughput fees and an impairment charge of **$3.1 million** classified under 'Other operating income (loss), net'[176](index=176&type=chunk) - **Transportation:** Operating income decreased to **$2.4 million** from **$3.5 million** YoY, mainly due to lower land transportation freight revenue and higher depreciation expense[181](index=181&type=chunk)[182](index=182&type=chunk) - **Sulfur Services:** Operating income surged to **$11.3 million** from **$3.8 million** YoY. This was driven by a **$6.8 million** increase in 'Other operating income, net', which included business interruption insurance recoveries and gains on asset dispositions, despite lower product revenues[187](index=187&type=chunk)[191](index=191&type=chunk) - **Natural Gas Liquids:** Operating income increased significantly to **$5.3 million** from **$1.7 million** YoY. Although revenues fell **29%** due to lower prices and volumes, cost of products sold decreased even more (**33%**), leading to an **83%** increase in margin per barrel[192](index=192&type=chunk)[193](index=193&type=chunk) [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) - As of March 31, 2020, the Partnership had **$0.1 million** in cash and **$46.2 million** of available borrowing capacity under its revolving credit facility[224](index=224&type=chunk) - The revolving credit facility's maturity will accelerate from August 2023 to August 19, 2020, if the 2021 Senior Notes are not refinanced. Failure to refinance would result in a default[210](index=210&type=chunk)[227](index=227&type=chunk) Contractual Cash Obligations as of March 31, 2020 (in thousands) | Type of Obligation | Total Obligation | Less than One Year | | :--- | :--- | :--- | | Revolving credit facility | $170,000 | $— | | 7.25% senior unsecured notes, due 2021 | $364,456 | $364,456 | | Operating leases | $30,668 | $9,519 | | Finance lease obligations | $5,640 | $5,114 | | **Total contractual cash obligations** | **$603,774** | **$409,284** | [Quantitative and Qualitative Disclosures About Market Risk](index=56&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The Partnership faces commodity price and interest rate risks, with minimal hedges, where a **100 basis point** rate increase would raise annual interest expense by approximately **$1.7 million** - The Partnership has hedging arrangements for NGLs with a gross notional quantity of **25,000 barrels** settling in April 2020[234](index=234&type=chunk) - Based on unhedged floating rate debt as of March 31, 2020, a **100 basis point (1%)** increase in interest rates would result in an approximate **$1.7 million** annual increase in interest expense[235](index=235&type=chunk) [Controls and Procedures](index=57&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO concluded that disclosure controls and procedures were effective, with no material changes to internal controls over financial reporting during the quarter - The CEO and CFO concluded that disclosure controls and procedures were effective as of March 31, 2020[238](index=238&type=chunk) - No material changes to internal controls over financial reporting occurred during the first quarter of 2020[239](index=239&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=58&type=section&id=Item%201.%20Legal%20Proceedings) The Partnership is involved in various ordinary course legal proceedings, including a specific dispute regarding customer indemnity, with no material adverse impact anticipated - The company is involved in a legal dispute with a customer in its lubricants packaging business regarding a demand for defense and indemnity. The ultimate exposure, if any, is currently indeterminable[118](index=118&type=chunk)[120](index=120&type=chunk) [Risk Factors](index=58&type=section&id=Item%201A.%20Risk%20Factors) A new material risk factor highlights the adverse impact of the COVID-19 pandemic on refined product demand, affecting operations, cash flows, and financial condition - A new material risk factor has been added regarding the adverse effects of the COVID-19 pandemic on the demand for refined products, which negatively impacts the company's operations, cash flows, and financial condition[244](index=244&type=chunk) [Exhibits](index=58&type=section&id=Item%206.%20Exhibits) This section incorporates by reference the Index to Exhibits, listing all documents filed as part of the quarterly report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K Mark One Annual Report Pursuant to Section 13 or 15(d) of the ☒ Securities Exchange Act of 1934 For the fiscal year ended December 31, 2019 OR 903-983-6200 (Registrant's telephone number, including area code) _______________________ Securities Registered Pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Common Units representing limited partnership interests M ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2019 OR TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Registrant's telephone number, including area code: (903) 983-6200 Securities registered pursuant to Section 12(b) of the Act | Title of eac ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2019 OR TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number 000-50056 MARTIN MIDSTREAM PARTNERS L.P. (Exact name of registrant as specified in its charter) Delaware 05-0527861 (State ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ý QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2019 OR o TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number 000-50056 MARTIN MIDSTREAM PARTNERS L.P. (Exact name of registrant as specified in its charter) Delaware 05-0527861 ( ...

PART I [Item 1. Business](index=4&type=section&id=Item%201.%20Business) Martin Midstream Partners L.P. operates in the U.S. Gulf Coast region across four business lines: terminalling and storage, NGLs transportation and distribution, sulfur services, and marine transportation, with Martin Resource Management maintaining significant control - The Partnership's four primary business lines are natural gas liquids transportation and distribution, terminalling and storage, sulfur and sulfur-based products, and marine transportation services[15](index=15&type=chunk) - Formed in 2002 by Martin Resource Management, which owned **15.7%** of outstanding common limited partner units and controls the general partner as of December 31, 2018[16](index=16&type=chunk) - On October 22, 2018, the Partnership agreed to acquire Martin Transport, Inc. for **$135.0 million** with a **$10.0 million** earn-out, effective January 1, 2019, for strategic long-term growth[20](index=20&type=chunk) - On July 31, 2018, the Partnership sold its **20%** non-operating interest in West Texas LPG Pipeline L.P. (WTLPG) for **$195.0 million** in cash, reducing revolving credit facility borrowings[21](index=21&type=chunk) - The Partnership's growth strategy includes organic projects, attracting new customers, strategic acquisitions, and forming commercial alliances[24](index=24&type=chunk)[31](index=31&type=chunk) - Key competitive strengths include generating a majority of cash flow from **fee-based contracts**, a diversified asset base, strategically located assets, specialized equipment, a strong industry reputation, and an experienced management team[25](index=25&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk) Terminalling and Storage Segment Facilities (Selected) | Terminal | Location | Aggregate Capacity (barrels) | Products | Description | | :--- | :--- | :--- | :--- | :--- | | Tampa | Tampa, Florida | 719,000 | Asphalt and fuel oil | Marine terminal, loading/unloading for vessels, barges, railcars and trucks | | Stanolind | Beaumont, Texas | 593,000 | Asphalt, crude oil, sulfur, sulfuric acid and fuel oil | Marine terminal, marine dock for loading/unloading of vessels, barges, railcars and trucks | | Neches | Beaumont, Texas | 548,000 | Molten sulfur, formed sulfur, ammonia, asphalt, fuel oil, crude oil and sulfur-based fertilizer | Marine terminal, loading/unloading for vessels, barges, railcars and trucks | | Smackover Refinery | Smackover, Arkansas | 7,700 barrels per day; 275,000 barrels of crude bulk storage; 647,000 barrels of lubricant storage | Naphthenic lubricants, distillates, asphalt, crude oil | Crude refining facility | | Martin Lubricants | Smackover, Arkansas | 3.9 million gallons bulk storage | Agricultural, automotive, and industrial lubricants and grease | Lubricants packaging facility | Natural Gas Services Segment Facilities | NGL Facility | Location | Capacity | Description | | :--- | :--- | :--- | :--- | | Wholesale terminals | Arcadia, Louisiana | 2,400,000 barrels | Underground storage | | Retail terminals | Kilgore, Texas | 90,000 gallons | Retail propane distribution | | Retail terminals | Longview, Texas | 30,000 gallons | Retail propane distribution | | Retail terminals | Henderson, Texas | 12,000 gallons | Retail propane distribution | | Rail terminal | Arcadia, Louisiana | 24 railcars per day | NGL railcar loading and unloading capabilities | Cardinal Gas Storage Facilities | Facility Name / Location | Facility Type | Working Storage Capacity | Percent of Capacity Contracted (1) | Weighted Average Life of Remaining Contract Term | | :--- | :--- | :--- | :--- | :--- | | Arcadia Gas Storage, LLC Bienville Parish, Louisiana | Salt dome | 15.25 billion cubic feet (bcf) | 100% | 2.2 years | | Cadeville Gas Storage, LLC Ouachita Parish, Louisiana | Depleted reservoir | 17.0 bcf | 100% | 4.4 years | | Perryville Gas Storage, LLC Franklin Parish, Louisiana | Salt dome | 11.85 bcf | 74% | 2.2 years | | Monroe Gas Storage Company, LLC Monroe County, Mississippi | Depleted reservoir | 6.7 bcf | 100% | 3.0 years | Sulfur Services Segment Marine Assets | Asset | Class of Equipment | Capacity/Horsepower | Products Transported | | :--- | :--- | :--- | :--- | | Margaret Sue | Offshore tank barge | 10,500 long tons | Molten sulfur | | M/V Martin Explorer | Offshore tugboat | 7,130 horsepower | N/A | | M/V Martin Express | Inland push boat | 1,200 horsepower | N/A | | MGM 101 | Inland tank barge | 2,500 long tons | Molten sulfur | | MGM 102 | Inland tank barge | 2,500 long tons | Molten sulfur | Sulfur Services Segment Manufacturing Plants | Facility | Location | Annual Capacity | Description | | :--- | :--- | :--- | :--- | | Fertilizer plant | Plainview, Texas | 150,000 tons | Fertilizer production | | Fertilizer plant | Beaumont, Texas | 110,000 tons | Liquid sulfur fertilizer production | | Fertilizer plants | Odessa, Texas | 35,000 tons | Dry sulfur fertilizer production | | Fertilizer plant | Seneca, Illinois | 36,000 tons | Dry sulfur fertilizer production | | Fertilizer plant | Cactus, Texas | 20,000 tons | Dry sulfur fertilizer production | | Industrial sulfur plant | Nash, Texas | 18,000 tons | Emulsified sulfur production | | Sulfuric acid plant | Plainview, Texas | 150,000 tons | Sulfuric acid production | Marine Transportation Segment Fleet | Class of Equipment | Number in Class | Capacity/Horsepower | Description of Products Carried | | :--- | :--- | :--- | :--- | | Inland tank barges | 7 | Under 20,000 barrels | Asphalt, crude oil, fuel oil, gasoline and sulfur | | Inland tank barges | 24 | 20,000 - 31,000 barrels | Asphalt, crude oil, fuel oil and gasoline | | Inland push boats | 17 | 800 - 2,650 horsepower | N/A | | Offshore tank barge | 1 | 59,000 barrels | Diesel fuel | | Offshore tugboat | 1 | 5,100 horsepower | N/A | [Item 1A. Risk Factors](index=23&type=section&id=Item%201A.%20Risk%20Factors) The Partnership faces risks including insufficient cash for distributions, demand volatility for terminalling services, increased interest expense, limited capital for growth, adverse weather, operational hazards, and tax reclassification risks - The Partnership may lack sufficient cash for minimum quarterly distributions due to acquisition costs, petroleum product prices, working capital fluctuations, capital expenditures, debt restrictions, and general partner cash reserve decisions[134](index=134&type=chunk)[135](index=135&type=chunk)[138](index=138&type=chunk) - Demand for terminalling and storage services is highly dependent on volatile offshore oil and gas exploration, development, and production activity, influenced by commodity prices, drilling rates, global demand, political conditions, and environmental regulations[137](index=137&type=chunk)[139](index=139&type=chunk)[140](index=140&type=chunk) - A **100 basis point** increase in interest rates would increase annual interest expense by approximately **$2.9 million**, impacting future earnings and cash flows[142](index=142&type=chunk) - Growth through acquisitions may be limited by insufficient capital resources or a higher cost of capital compared to peers[145](index=145&type=chunk)[146](index=146&type=chunk) - Adverse weather conditions in the Gulf Coast region can significantly delay marine transportation, disrupt offshore drilling, and decrease demand for NGLs and fertilizers, reducing net income and cash flow[152](index=152&type=chunk)[153](index=153&type=chunk) - Operations are subject to significant hazards (accidents, spills, fires, natural disasters, terrorist attacks) that may not be fully covered by insurance, potentially leading to material liabilities[154](index=154&type=chunk)[156](index=156&type=chunk)[157](index=157&type=chunk) - The U.S. Internal Revenue Service (IRS) could treat the Partnership as a corporation for tax purposes if it fails to meet the 'qualifying income' requirement, substantially reducing cash available for distribution to unitholders[209](index=209&type=chunk)[210](index=210&type=chunk)[211](index=211&type=chunk)[212](index=212&type=chunk)[214](index=214&type=chunk) - Unitholders may be required to pay taxes on allocated income, including from cancellation of debt, even without receiving corresponding cash distributions[225](index=225&type=chunk)[226](index=226&type=chunk) [Item 1B. Unresolved Staff Comments](index=35&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) There are no unresolved staff comments to report - No unresolved staff comments[238](index=238&type=chunk) [Item 2. Properties](index=35&type=section&id=Item%202.%20Properties) The Partnership's properties are detailed in Item 1, with satisfactory title to assets and necessary consents obtained, and any encumbrances are not believed to materially detract from value or interfere with operations - A description of the Partnership's properties is contained in "Item 1. Business"[239](index=239&type=chunk) - The Partnership believes it has satisfactory title to its assets and has obtained sufficient third-party consents, permits, and authorizations for business operations in all material respects[240](index=240&type=chunk) - Property titles may be subject to encumbrances, including liens from secured lenders, but these are not believed to materially detract from value or interfere with business operations[240](index=240&type=chunk) [Item 3. Legal Proceedings](index=35&type=section&id=Item%203.%20Legal%20Proceedings) The Partnership is involved in various legal proceedings in the ordinary course of business, which management believes will not materially impact its financial position, results of operations, or liquidity - The Partnership is subject to various legal proceedings, claims, and disputes in the ordinary course of business[241](index=241&type=chunk) - Management believes the ultimate disposition of these matters will not have a material adverse impact on the Partnership's financial position, results of operations, or liquidity[241](index=241&type=chunk) - A description of legal proceedings is included in "Item 8. Financial Statements and Supplementary Data, Note 22. Commitments and Contingencies"[241](index=241&type=chunk) [Item 4. Mine Safety Disclosures](index=35&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Partnership - Not applicable[242](index=242&type=chunk) PART II [Item 5. Market for Our Common Equity, Related Unitholder Matters and Issuer Purchases of Equity Securities](index=36&type=section&id=Item%205.%20Market%20for%20Our%20Common%20Equity%2C%20Related%20Unitholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The Partnership's common units trade on NASDAQ under "MMLP", with distributions restricted by credit facility covenants, and a **$0.50** per common unit quarterly distribution declared for Q4 2018 - The Partnership's common units are traded on the NASDAQ under the symbol "MMLP"[245](index=245&type=chunk) - As of January 25, 2019, there were approximately **279** holders of record and **20,329** beneficial owners of common units[245](index=245&type=chunk) - The Partnership distributes all available cash quarterly, with the general partner having broad discretion to establish cash reserves for business conduct, legal compliance, debt reduction, or future distributions[246](index=246&type=chunk) - Distributions are contractually restricted by the credit facility, prohibiting payments during a default or if a distribution would cause a default[247](index=247&type=chunk) - On January 17, 2019, a quarterly cash distribution of **$0.50** per common unit (**$2.00** annualized) for Q4 2018 was declared, payable on February 14, 2019[247](index=247&type=chunk) [Item 6. Selected Financial Data](index=36&type=section&id=Item%206.%20Selected%20Financial%20Data) This section provides a five-year overview of the Partnership's selected financial data from 2014 to 2018, including revenues, net income, total assets, long-term debt, and cash dividends per common unit Selected Financial Data (2014-2018) | | 2018 | 2017 | 2016 | 2015 | 2014 | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenues | $972,655 | $946,116 | $827,391 | $1,036,844 | $1,642,141 | | Income (loss) from continuing operations | $(7,595) | $13,007 | $27,003 | $32,088 | $(11,590) | | Income (loss) from discontinued operations, net of tax | $51,700 | $4,128 | $4,649 | $10,169 | $(115) | | Net income (loss) | $44,105 | $17,135 | $31,652 | $42,257 | $(11,705) | | Net income (loss) attributable to limited partners | $43,195 | $16,750 | $23,143 | $21,902 | $(15,176) | | Net income (loss) per limited partner unit – continuing operations | $(0.19) | $0.33 | $0.55 | $0.47 | $(0.48) | | Net income (loss) per limited partner unit – discontinued operations | $1.30 | $0.11 | $0.10 | $0.15 | $(0.01) | | Net income (loss) per limited partner unit | $1.11 | $0.44 | $0.65 | $0.62 | $(0.49) | | Total assets | $1,033,398 | $1,253,498 | $1,246,363 | $1,380,473 | $1,553,919 | | Long-term debt | $656,459 | $812,632 | $808,107 | $865,003 | $902,005 | | Cash dividends per common unit (in dollars) | $2.00 | $2.00 | $2.94 | $3.25 | $3.18 | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes the Partnership's financial condition and operational results across its four business lines, utilizing non-GAAP measures like EBITDA and Distributable Cash Flow, and discusses segment performance, interest expense, liquidity, and capital resources - The Partnership's management uses non-GAAP financial measures such as EBITDA, Adjusted EBITDA, and Distributable Cash Flow to analyze performance, assess core profitability, and evaluate cash flow generation for distributions[262](index=262&type=chunk)[265](index=265&type=chunk)[266](index=266&type=chunk) Reconciliation of EBITDA, Adjusted EBITDA, and Distributable Cash Flow (2016-2018) | | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | | Net income | $44,105 | $17,135 | $31,652 | | Income (loss) from continuing operations | $(7,595) | $13,007 | $27,003 | | EBITDA | $121,677 | $146,297 | $165,961 | | Adjusted EBITDA | $123,669 | $151,021 | $169,142 | | Distributable Cash Flow | $51,004 | $85,854 | $106,264 | Operating Revenues and Income by Segment (2016-2018) | Segment | 2018 Revenues | 2018 Operating Income | 2017 Revenues | 2017 Operating Income | 2016 Revenues | 2016 Operating Income | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Terminalling and storage | $241,614 | $13,725 | $230,171 | $629 | $236,710 | $40,660 | | Natural gas services | $548,135 | $28,570 | $532,682 | $51,849 | $391,333 | $41,503 | | Sulfur services | $132,536 | $14,276 | $134,684 | $23,205 | $141,058 | $23,393 | | Marine transportation | $50,370 | $6,116 | $48,579 | $1,650 | $58,290 | $(16,039) | | Indirect selling, general and administrative | — | $(17,901) | — | $(17,332) | — | $(16,794) | | Total | $972,655 | $44,786 | $946,116 | $60,001 | $827,391 | $72,723 | - Terminalling and Storage segment revenues increased by **$11.7 million (5%)** in 2018, driven by a **28%** increase in lubricant sales volumes and a **4%** increase in average sales price, partially offset by decreased throughput fees at shore-based terminals[276](index=276&type=chunk)[277](index=277&type=chunk) - Natural Gas Services segment revenues increased by **$15.2 million (3%)** in 2018, primarily due to a **7%** increase in NGL average sales price per barrel, despite a **3%** decrease in sales volumes, while operating income decreased by **49%** due to higher cost of products sold and increased operating expenses[291](index=291&type=chunk)[292](index=292&type=chunk)[293](index=293&type=chunk)[294](index=294&type=chunk) - Sulfur Services segment revenues decreased by **$2.1 million (2%)** in 2018, mainly due to an **11%** decrease in sales volumes (primarily sulfur), partially offset by a **10%** rise in average sales prices, with operating income decreasing by **33%** due to higher cost of products sold[305](index=305&type=chunk)[306](index=306&type=chunk) - Marine Transportation segment revenues increased by **$0.9 million (2%)** in 2018, driven by new equipment and increased pass-through revenue, partially offset by revenue from equipment sold or classified as idle[316](index=316&type=chunk) - Total interest expense, net, increased by **$4.3 million (9%)** in 2018, primarily due to a **$2.0 million** increase in revolving loan facility interest and a **$0.7 million** increase in other interest expenses[329](index=329&type=chunk) - Indirect selling, general and administrative expenses increased by **$0.6 million (3%)** in 2018, mainly due to increased unit-based compensation expense[330](index=330&type=chunk) - Net cash provided by operating activities increased by **$23.2 million (34%)** in 2018, driven by a **$52.6 million** favorable variance in working capital and a **$4.8 million** decrease in other non-cash charges, partially offset by a **$20.6 million** decrease in operating results[341](index=341&type=chunk) - Net cash provided by investing activities increased by **$185.5 million (490%)** in 2018, primarily due to a **$177.3 million** increase in net cash from discontinued investing activities (WTLPG sale) and a **$19.5 million** decrease in cash used for acquisitions[342](index=342&type=chunk) - Net cash used in financing activities increased by **$208.6 million (704%)** in 2018, mainly due to a **$160.0 million** increase in net repayments of long-term borrowings and a **$52.3 million** decrease in proceeds from common unit issuance[343](index=343&type=chunk) Total Contractual Obligations as of December 31, 2018 | Type of Obligation | Total Obligation | Less than One Year | 1-3 Years | 3-5 Years | More than 5 years | | :--- | :--- | :--- | :--- | :--- | :--- | | Revolving credit facility | $287,000 | $— | $287,000 | $— | $— | | 2021 senior unsecured notes | $373,800 | $— | $373,800 | $— | $— | | Throughput commitment | $16,030 | $6,194 | $9,836 | $— | $— | | Operating leases | $27,921 | $7,869 | $8,633 | $3,596 | $7,823 | | Interest payable on fixed long-term obligations | $57,589 | $27,101 | $30,488 | $— | $— | | Total contractual cash obligations | $762,340 | $41,164 | $709,757 | $3,596 | $7,823 | - As of December 31, 2018, the Partnership had **$287.0 million** outstanding under its **$664.4 million** revolving credit facility, with **$16.9 million** in letters of credit, leaving **$360.5 million** available, of which **$25.8 million** could be borrowed based on financial covenants[357](index=357&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures about Market Risk](index=64&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The Partnership manages commodity price risk for NGLs through hedging, with a **$0.10** change in settlement price impacting net income by **$0.2 million**, and faces interest rate risk on its variable-rate credit facility, where a **100 basis point** increase would raise annual interest expense by **$2.9 million** - The Partnership uses derivatives, primarily NGL swaps, to manage commodity price fluctuation risk[374](index=374&type=chunk) - As of December 31, 2018, the Partnership had hedging instruments for **55,000 barrels** of NGLs, with a **$0.10** change in expected settlement price impacting net income by **$0.2 million**[375](index=375&type=chunk) - The Partnership is exposed to interest rate risk on its variable-rate credit facility (weighted-average interest rate of **5.24%** at December 31, 2018); a **100 basis point** increase in interest rates would increase annual interest expense by approximately **$2.9 million**[376](index=376&type=chunk) - The senior unsecured notes are fixed-rate; a hypothetical **100 basis point** increase in interest rates would decrease their fair value by approximately **$6.8 million** at December 31, 2018[377](index=377&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=65&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements of Martin Midstream Partners L.P. for 2016-2018, including balance sheets, statements of operations, changes in capital, and cash flows, along with comprehensive notes and the independent auditor's opinion - The consolidated financial statements include the Partnership's wholly-owned subsidiaries and equity method investees, prepared in conformity with U.S. GAAP[415](index=415&type=chunk) - On July 31, 2018, the Partnership completed the sale of its **20%** non-operating interest in WTLPG, which is presented as discontinued operations for the years ended December 31, 2018, 2017, and 2016[416](index=416&type=chunk) Consolidated Balance Sheets (Selected Data, 2017-2018) | Assets | December 31, 2018 | December 31, 2017 | | :--- | :--- | :--- | | Cash | $237 | $27 | | Total current assets | $194,042 | $242,663 | | Property, plant and equipment, net | $798,349 | $831,928 | | Total assets | $1,033,398 | $1,253,498 | | Liabilities and Partners' Capital | | | | Total current liabilities | $101,513 | $134,408 | | Long-term debt, net | $656,459 | $812,632 | | Total liabilities | $768,686 | $955,257 | | Total partners' capital | $264,712 | $298,241 | Consolidated Statements of Operations (Selected Data, 2016-2018) | | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | | Total revenues | $972,655 | $946,116 | $827,391 | | Total costs and expenses | $927,490 | $886,638 | $788,068 | | Operating income | $44,786 | $60,001 | $72,723 | | Interest expense, net | $(52,037) | $(47,743) | $(46,100) | | Net income (loss) before taxes | $(7,226) | $13,359 | $27,729 | | Income (loss) from continuing operations | $(7,595) | $13,007 | $27,003 | | Income from discontinued operations, net of income taxes | $51,700 | $4,128 | $4,649 | | Net income | $44,105 | $17,135 | $31,652 | | Limited partner's interest in net income | $43,195 | $16,750 | $23,143 | | Net income per limited partner unit | $1.11 | $0.44 | $0.65 | Consolidated Statements of Cash Flows (Selected Data, 2016-2018) | Cash flows from: | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | | Operating activities | $90,726 | $67,506 | $110,848 | | Investing activities | $147,654 | $(37,878) | $63,839 | | Financing activities | $(238,170) | $(29,616) | $(174,703) | | Net increase (decrease) in cash | $210 | $12 | $(16) | | Cash at end of year | $237 | $27 | $15 | - The Partnership adopted ASU 2014-09, Revenue from Contracts with Customers, on January 1, 2018, using the cumulative effect method, resulting in no significant changes in revenue recognition timing[462](index=462&type=chunk) - The Partnership expects to adopt ASU 2016-02, Leases, on January 1, 2019, and estimates approximately **$19.9 million** of additional assets and liabilities will be reflected on its Consolidated Balance Sheet[462](index=462&type=chunk)[465](index=465&type=chunk) Estimated Future Revenue from Unsatisfied Performance Obligations (2019-Thereafter) | Segment | 2019 | 2020 | 2021 | 2022 | 2023 | Thereafter | Total | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Terminalling and storage | $50,079 | $49,354 | $46,642 | $42,735 | $42,854 | $392,624 | $624,288 | | Natural gas services | $37,979 | $32,119 | $26,276 | $24,615 | $10,107 | $— | $131,096 | | Sulfur services | $17,082 | $4,898 | $1,181 | $295 | $— | $— | $23,456 | | Marine transportation | $6,205 | $— | $— | $— | $— | $— | $6,205 | | Total | $111,345 | $86,371 | $74,099 | $67,645 | $52,961 | $392,624 | $785,045 | - As of December 31, 2018, Martin Resource Management owned approximately **15.7%** of the Partnership's outstanding common limited partnership units and controls the general partner, MMGP, which holds a **2%** general partner interest and incentive distribution rights[517](index=517&type=chunk)[560](index=560&type=chunk) - The general partner was allocated **$0** in incentive distributions for 2018 and 2017, and **$7,786** in 2016[565](index=565&type=chunk) - On January 2, 2019, the Partnership acquired Martin Transport, Inc. for a total consideration of **$135.0 million**, plus a **$2.8 million** working capital adjustment, and assumed **$11.7 million** in capital leases[607](index=607&type=chunk)[610](index=610&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=107&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) There have been no changes in or disagreements with accountants on accounting and financial disclosure - None[613](index=613&type=chunk) [Item 9A. Controls and Procedures](index=107&type=section&id=Item%209A.%20Controls%20and%20Procedures) As of December 31, 2018, the Partnership's disclosure controls and procedures were effective, with ongoing implementation of a new ERP system and changes related to ASC 606, and management concluded internal control over financial reporting was effective - As of December 31, 2018, the Chief Executive Officer and Chief Financial Officer of the general partner concluded that the Partnership's disclosure controls and procedures were effective[614](index=614&type=chunk) - The Partnership began implementing a new enterprise resource planning (ERP) system in 2017, which is expected to take several years to fully deploy and requires significant capital and human resources[615](index=615&type=chunk) - Changes were implemented in processes related to revenue recognition and control activities following the adoption of ASC 606 on January 1, 2018[616](index=616&type=chunk) - Management concluded that the Partnership's internal control over financial reporting was effective as of December 31, 2018, based on criteria established in the Internal Control — Integrated Framework (2013)[619](index=619&type=chunk) [Item 9B. Other Information](index=109&type=section&id=Item%209B.%20Other%20Information) There is no other information to report - None[621](index=621&type=chunk) PART III [Item 10. Directors, Executive Officers and Corporate Governance](index=110&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) The Partnership is managed by its general partner, Martin Midstream GP LLC, whose directors and executive officers are also employees of Martin Resource Management, with independent directors serving on key committees and adherence to a Code of Ethics - The Partnership is managed by its general partner, Martin Midstream GP LLC, whose directors and executive officers are not elected by unitholders and are also employees of Martin Resource Management[622](index=622&type=chunk)[626](index=626&type=chunk) - The general partner's board includes a Conflicts Committee, Audit Committee, Compensation Committee, and Nominating Committee, with independent directors serving on these committees[623](index=623&type=chunk)[624](index=624&type=chunk)[625](index=625&type=chunk) Directors and Executive Officers of Martin Midstream GP LLC | Name | Age | Position with the General Partner | | :--- | :--- | :--- | | Ruben S. Martin | 67 | President, Chief Executive Officer and Director | | Robert D. Bondurant | 60 | Executive Vice President and Chief Financial Officer and Director | | Randall L. Tauscher | 53 | Executive Vice President and Chief Operating Officer | | Chris H. Booth | 49 | Executive Vice President, Chief Legal Officer, General Counsel and Secretary | | Scot A. Shoup | 58 | Senior Vice President of Operations | | C. Scott Massey | 66 | Director | | James M. Collingsworth | 64 | Director | | Byron R. Kelley | 71 | Director | | Sean P. Dolan | 45 | Director | | Zachary S. Stanton | 43 | Director | - Messrs. Massey, Collingsworth, and Kelley qualify as "independent" directors according to NASDAQ listing requirements and applicable securities laws[640](index=640&type=chunk) - The Audit Committee reviews financial reporting, recommends independent auditors, and oversees internal controls, with C. Scott Massey designated as an "audit committee financial expert"[644](index=644&type=chunk) - The Partnership has adopted a Code of Ethics and Business Conduct applicable to all employees and independent directors, promoting ethical conduct and compliance[647](index=647&type=chunk) [Item 11. Executive Compensation](index=115&type=section&id=Item%2011.%20Executive%20Compensation) This section outlines the compensation for Named Executive Officers, who are employees of Martin Resource Management, including base salary, cash awards, and restricted unit grants from the 2017 LTIP, with director compensation also detailed - The Partnership does not directly compensate its executive officers; they are employed by Martin Resource Management, which allocates a portion of their compensation costs to the Partnership under the Omnibus Agreement[651](index=651&type=chunk)[652](index=652&type=chunk)[660](index=660&type=chunk) - Executive compensation elements include annual base salary, discretionary annual cash awards, and awards from the Martin Midstream Partners L.P. 2017 Restricted Unit Plan and Martin Resource Management employee benefit plans[653](index=653&type=chunk) - The 2017 Long-Term Incentive Plan (LTIP) permits grants of time-based restricted units (TBRUs) and performance-based restricted units (PBRUs) to key employees and directors, with vesting tied to service periods and achievement of performance targets[667](index=667&type=chunk)[669](index=669&type=chunk) Summary Compensation Table for Named Executive Officers (2016-2018) | Name and Principal Position | Year | Salary | Bonus | Stock Awards (1) | Total Compensation | | :--- | :--- | :--- | :--- | :--- | :--- | | Ruben S. Martin, President and Chief Executive Officer | 2018 | $262,500 | $— | $1,158,913 | $1,421,413 | | | 2017 | $412,500 | $— | $— | $412,500 | | | 2016 | $412,500 | $— | $— | $412,500 | | Robert D. Bondurant, Executive Vice President and Chief Financial Officer | 2018 | $240,000 | $— | $740,870 | $980,870 | | | 2017 | $230,000 | $— | $— | $230,000 | | | 2016 | $230,000 | $— | $— | $230,000 | | Randall L. Tauscher, Executive Vice President and Chief Operating Officer | 2018 | $288,000 | $— | $740,870 | $1,028,870 | | | 2017 | $276,000 | $— | $— | $276,000 | | | 2016 | $308,200 | $— | $— | $308,200 | | Chris H. Booth, Executive Vice President, General Counsel and Secretary | 2018 | $192,500 | $— | $556,000 | $748,500 | | | 2017 | $183,600 | $— | $— | $183,600 | | | 2016 | $165,240 | $— | $— | $165,240 | | Scot A. Shoup, Senior Vice President of Operations | 2018 | $279,000 | $— | $222,400 | $501,400 | | | 2017 | $270,000 | $— | $— | $270,000 | | | 2016 | $180,000 | $— | $— | $180,000 | Director Compensation (2018) | Name | Fees Earned Paid in Cash | Stock Awards (2) | Total | | :--- | :--- | :--- | :--- | | Ruben S. Martin | $— | $1,158,913 | $1,158,913 | | Robert D. Bondurant | $— | $740,870 | $740,870 | | C. Scott Massey | $65,000 | $74,633 | $139,633 | | Byron R. Kelley | $65,000 | $74,633 | $139,633 | | James M. Collingsworth | $65,000 | $74,633 | $139,633 | | Sean P. Dolan | $— | $— | $— | | Zachary S. Stanton | $— | $— | $— | [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=121&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) This section details the beneficial ownership of the Partnership's common units as of February 19, 2019, highlighting significant control by Martin Resource Management Corporation and its affiliates, and provides information on equity compensation plans Beneficial Ownership of Common Units as of February 19, 2019 | Name of Beneficial Owner | Common Units Beneficially Owned | Percentage of Common Units Beneficially Owned | | :--- | :--- | :--- | | MRMC ESOP Trust | 6,114,532 | 15.7% | | Martin Resource Management Corporation | 6,114,532 | 15.7% | | Martin Resource, LLC | 4,203,823 | 10.8% | | Martin Product Sales LLC | 1,021,265 | 2.6% | | Cross Oil Refining & Marketing Inc. | 889,444 | 2.3% | | OppenheimerFunds, Inc. | 7,760,760 | 19.9% | | Ruben S. Martin | 6,446,851 | 16.5% | | Robert D. Bondurant | 69,772 | —% | | Randall L. Tauscher | 55,145 | —% | | Chris H. Booth | 31,330 | —% | | Scot A. Shoup | 10,100 | —% | | Sean Dolan | — | —% | | Zachary S. Stanton | — | —% | | C. Scott Massey | 41,298 | —% | | Byron R. Kelley | 26,898 | —% | | James M. Collingsworth | 24,298 | —% | | All directors and executive officers as a group (10 persons) | 6,705,692 | 17.2% | - Martin Resource Management Corporation, through its affiliates, owns approximately **15.7%** of the Partnership's outstanding common limited partner units and controls the general partner, giving it significant influence over management[698](index=698&type=chunk)[706](index=706&type=chunk) Equity Compensation Plan Information as of December 31, 2018 | Plan Category | Number of securities to be issued upon exercise of outstanding options, Warrants and rights (a) | Weighted-average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | | :--- | :--- | :--- | :--- | | Equity compensation plans approved by security holders | N/A | N/A | 2,393,575 | | Total | — | $— | 2,393,575 | - In February 2019, **5,648** restricted common units were issued to independent directors under the long-term incentive plan, vesting in equal installments through January 2023[704](index=704&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=124&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) This section details the extensive related party transactions and agreements between the Partnership and Martin Resource Management, which controls the general partner, ensuring fairness through Conflicts Committee approval for material transactions - Martin Resource Management controls the Partnership's general partner and owns approximately **15.7%** of its outstanding common limited partnership units, granting it significant influence over the Partnership's management and actions[706](index=706&type=chunk) Distributions and Payments to General Partner and Affiliates | Stage | Description | | :--- | :--- | | Formation Stage | Ÿ 4,253,362 subordinated units (converted to common units); Ÿ 2% general partner interest; and Ÿ the incentive distribution rights. | | Operational Stage | Ÿ Cash distributions 98% to unitholders and 2% to general partner, with increasing percentages (up to 50%) for general partner based on incentive distribution rights if target distribution levels are exceeded. Ÿ Reimbursement to Martin Resource Management for all direct expenses and a portion of indirect general and administrative and corporate overhead expenses, approved by the Conflicts Committee. | | Withdrawal or removal of our general partner | General partner interest and incentive distribution rights sold to new general partner or converted to common units at fair market value. | | Liquidation Stage | Partners receive liquidating distributions according to capital account balances. | - The Omnibus Agreement governs potential competition, indemnification, related party transactions, and the provision of general administration and support services by Martin Resource Management[709](index=709&type=chunk)[710](index=710&type=chunk) - The Partnership reimbursed Martin Resource Management **$16.4 million** for indirect general and administrative and corporate overhead expenses in 2018 and 2017, and **$13.0 million** in 2016, as approved by the Conflicts Committee[713](index=713&type=chunk) - The Partnership had a **$15.0 million** note receivable from an affiliate of Martin Resource Management, which was fully repaid in the second quarter of 2017[730](index=730&type=chunk) - On February 22, 2017, the Partnership acquired MEH South Texas Terminals LLC, a Martin Resource Management subsidiary, for **$27.4 million**, with the **$7.9 million** excess purchase price over carrying value recorded as an adjustment to "Partners' capital"[732](index=732&type=chunk) - Material related party transactions require prior approval from the Conflicts Committee to ensure fairness and reasonableness to the Partnership and its unitholders[735](index=735&type=chunk) [Item 14. Principal Accounting Fees and Services](index=129&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) This section details the fees paid to KPMG LLP for audit, audit-related, and tax services in 2017 and 2018, all of which were pre-approved by the Audit Committee to maintain auditor independence Fees Paid to KPMG LLP (2017-2018) | | 2018 | 2017 | | :--- | :--- | :--- | | Audit fees | $1,238,500 | $1,349,934 | | Audit related fees | $— | $— | | Audit and audit related fees | $1,238,500 | $1,349,934 | | Tax fees | $82,106 | $123,167 | | All other fees | $— | $124,550 | | Total fees | $1,320,606 | $1,597,651 | - All audit and non-audit services performed by KPMG LLP were pre-approved by the Audit Committee to ensure auditor independence[738](index=738&type=chunk) PART IV [Item 15. Exhibits, Financial Statement Schedules](index=130&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists all exhibits and financial statement schedules, including the Partnership's and WTLPG's financial statements, along with WTLPG's Independent Auditor's Report and notes detailing its operations, accounting policies, and legal proceedings - This section includes the Partnership's financial statements, financial statement schedules, and the separate financial statements of West Texas LPG Pipeline Limited Partnership (WTLPG)[741](index=741&type=chunk) - The Independent Auditor's Report for WTLPG covers its balance sheets as of July 31, 2018, and December 31, 2017, and statements of operations, changes in partners' capital, and cash flows for the period from January 1, 2018, to July 31, 2018, and the year ended December 31, 2017[743](index=743&type=chunk) - WTLPG's financial statements for the year ended December 31, 2016, are presented for SEC compliance but are not covered by the auditor's report[748](index=748&type=chunk) West Texas LPG Pipeline Limited Partnership Balance Sheets (Selected Data) | Assets | July 31, 2018 | December 31, 2017 | | :--- | :--- | :--- | | Cash and cash equivalents | $6,247 | $27,927 | | Total current assets | $25,692 | $47,312 | | Property, plant and equipment, net | $902,501 | $789,515 | | Total assets | $928,504 | $837,164 | | Liabilities and Partners' Capital | | | | Total current liabilities | $53,717 | $43,774 | | Total liabilities | $59,610 | $49,738 | | Partners' capital | $868,894 | $787,426 | West Texas LPG Pipeline Limited Partnership Statements of Operations (Selected Data) | | Period from Jan 1, 2018 through July 31, 2018 | Year Ended Dec 31, 2017 | Year Ended Dec 31, 2016* | | :--- | :--- | :--- | :--- | | Revenue | $55,534 | $87,049 | $88,467 | | Total costs and expenses | $38,853 | $65,530 | $64,562 | | Net income | $16,642 | $21,572 | $23,883 | West Texas LPG Pipeline Limited Partnership Statements of Cash Flows (Selected Data) | Cash flows from: | Period from Jan 1, 2018 through July 31, 2018 | Year Ended Dec 31, 2017 | Year Ended Dec 31, 2016* | | :--- | :--- | :--- | :--- | | Operating activities | $1,671 | $54,877 | $39,305 | | Investing activities | $(90,094) | $(5,555) | $(3,946) | | Financing activities | $66,743 | $(24,552) | $(37,500) | | Net increase (decrease) in cash and cash equivalents | $(21,680) | $24,770 | $(2,141) | | Cash and cash equivalents at end of period | $6,247 | $27,927 | $3,157 | - WTLPG's revenue is derived from fees for transporting NGLs, based on tariffs regulated by governmental agencies or contractual arrangements[763](index=763&type=chunk) - WTLPG has no employees; the Operator's employees support and maintain its assets, with WTLPG reimbursing for direct costs and paying a management fee for administrative costs[800](index=800&type=chunk) - WTLPG's 2015 rate complaints with the Railroad Commission of Texas (RRC) regarding market-based common carrier rates were resolved by a settlement formally approved in January 2019[806](index=806&type=chunk)[807](index=807&type=chunk) - The Occidental Energy Marketing, Inc. v. WTLPG lawsuit, alleging breach of contract for failure to redeliver NGLs, was remanded to the trial court in October 2018 for further proceedings, with potential material charges[808](index=808&type=chunk)[809](index=809&type=chunk)[810](index=810&type=chunk)