Martin Midstream Partners(MMLP) - 2025 Q3 - Quarterly Results

Executive Summary & Q3 2025 Highlights Martin Midstream Partners reported Q3 2025 adjusted EBITDA below projections, withdrew full-year guidance, and saw its leverage ratio increase Q3 2025 Performance Overview Martin Midstream Partners reported Q3 2025 adjusted EBITDA of $19.3 million, which was below internal projections, primarily due to weaker performance in marine and grease businesses. The Partnership is withdrawing its full-year 2025 guidance due to demand softness in inland barge fuel transportation and an increased adjusted leverage ratio to 4.63x, though it remains compliant with debt covenants - Adjusted EBITDA for Q3 2025 was $19.3 million, falling below internal projections due to weaker performance in marine and grease businesses[2] - The Partnership is withdrawing its full-year 2025 guidance amid current demand softness impacting inland barge utilization in the Transportation segment[2][22] - The adjusted leverage ratio increased to 4.63 times as of September 30, 2025, up from 4.20 times on June 30, 2025, though the Partnership remained in compliance with all debt covenants[2] Key Financial Highlights For the three months ended September 30, 2025, Martin Midstream Partners reported a net loss of $8.4 million and adjusted EBITDA of $19.3 million. The Partnership also declared a quarterly cash distribution of $0.005 per common unit - Net loss of $8.4 million for the three months ended September 30, 2025[3] - Adjusted EBITDA of $19.3 million for the three months ended September 30, 2025[3] - Declared a quarterly cash distribution of $0.005 per common unit[3][24] Operating Results by Business Segment This section provides a detailed breakdown of operating income and Adjusted EBITDA across the Transportation, Terminalling and Storage, Sulfur Services, and Specialty Products segments Segment Performance Summary Overall Adjusted EBITDA for Q3 2025 decreased to $19.3 million from $25.1 million in Q3 2024. The Transportation and Specialty Products segments experienced declines, while Terminalling and Storage showed an increase, and Sulfur Services saw a modest decrease | Business Segment | Operating Income (Loss) (Millions of USD) 2025 | Operating Income (Loss) (Millions of USD) 2024 | Adjusted EBITDA (Millions of USD) 2025 | Adjusted EBITDA (Millions of USD) 2024 | | :----------------- | :--------------------------------------------- | :--------------------------------------------- | :------------------------------------- | :------------------------------------- | | Transportation | $2.8 | $8.6 | $5.3 | $11.6 | | Terminalling and Storage | $4.6 | $2.7 | $9.7 | $8.4 | | Sulfur Services | $0.2 | $1.3 | $3.9 | $4.2 | | Specialty Products | $3.2 | $3.9 | $3.9 | $4.6 | | Indirect Selling, General and Administrative Expenses | $(3.9) | $(3.7) | $(3.6) | $(3.7) | | Total | $6.9 | $12.7 | $19.3 | $25.1 | Transportation Segment The Transportation segment experienced a significant decline in Q3 2025, with Adjusted EBITDA decreasing by $6.3 million (54.3%) year-over-year, primarily due to reduced demand for inland barge fuel transportation and lower day rates in the marine division, and lower miles and rates in the land division - Adjusted EBITDA for the Transportation segment decreased by $6.3 million (54.3%) to $5.3 million in Q3 2025 from $11.6 million in Q3 2024[4][6] - The marine division's Adjusted EBITDA decreased by $5.0 million due to reduced demand for inland barge fuel transportation and lower day rates[6] - Operating income for the Transportation segment decreased by $5.795 million (68%) to $2.788 million in Q3 2025 from $8.583 million in Q3 2024[51] Terminalling and Storage Segment The Terminalling and Storage segment showed improved performance in Q3 2025, with Adjusted EBITDA increasing by $1.3 million (15.5%) year-over-year, driven by increased storage and throughput volumes in the underground NGL storage division. However, operating income saw a decline - Adjusted EBITDA for the Terminalling and Storage segment increased by $1.3 million (15.5%) to $9.7 million in Q3 2025 from $8.4 million in Q3 2024[4][7] - The increase was primarily due to a $1.4 million rise in Adjusted EBITDA in the underground NGL storage division, driven by increased storage and throughput volumes[7] - Operating income decreased by $1.902 million (71%) to $2.675 million in Q3 2025 from $4.577 million in Q3 2024[53] Sulfur Services Segment The Sulfur Services segment experienced a slight decrease in Adjusted EBITDA by $0.3 million (7.1%) in Q3 2025, primarily due to reduced sales volume in the pure sulfur and sulfur prilling businesses, despite an increase in the fertilizer division - Adjusted EBITDA for the Sulfur Services segment decreased by $0.3 million (7.1%) to $3.9 million in Q3 2025 from $4.2 million in Q3 2024[4][8] - The fertilizer division's Adjusted EBITDA increased by $1.0 million due to reservation fees and higher sales volume, while pure sulfur and sulfur prilling businesses saw decreases[8] - Operating income decreased by $1.059 million (84%) to $0.195 million in Q3 2025 from $1.254 million in Q3 2024[54] Specialty Products Segment The Specialty Products segment's Adjusted EBITDA decreased by $0.7 million (15.2%) in Q3 2025, mainly due to lower margins from a higher mix of lower-margin product sales in the grease division, despite a slight increase in lubricants - Adjusted EBITDA for the Specialty Products segment decreased by $0.7 million (15.2%) to $3.9 million in Q3 2025 from $4.6 million in Q3 2024[4][9] - The grease division's Adjusted EBITDA decreased by $0.9 million, primarily due to lower margins associated with a higher mix of lower-margin product sales[9] - Operating income decreased by $0.680 million (18%) to $3.201 million in Q3 2025 from $3.881 million in Q3 2024[56] Indirect Selling, General and Administrative Expenses Indirect selling, general, and administrative expenses decreased by $0.1 million in Q3 2025, primarily due to lower professional fees - Indirect selling, general, and administrative expenses decreased by $0.1 million in Q3 2025, primarily due to lower professional fees[10] Indirect Selling, General and Administrative Expenses | Period | 2025 (Thousands of USD) | 2024 (Thousands of USD) | Variance | Percent Change | | :----- | :---------------------- | :---------------------- | :------- | :------------- | | 3 Months Ended Sep 30 | $3,860 | $3,742 | $118 | 3% | | 9 Months Ended Sep 30 | $12,472 | $11,397 | $1,075 | 9% | Consolidated Financial Statements This section provides an overview of the Partnership's consolidated balance sheets, statements of operations, capital, and cash flows for the reported periods Consolidated Balance Sheets As of September 30, 2025, total assets decreased to $510.1 million from $538.5 million at December 31, 2024. Total liabilities also decreased, while partners' capital (deficit) widened Consolidated Balance Sheets | Metric | Sep 30, 2025 (Thousands of USD) | Dec 31, 2024 (Thousands of USD) | | :---------------------------------- | :------------------------------ | :------------------------------ | | Total current assets | $117,317 | $130,479 | | Property, plant and equipment, net | $291,771 | $305,450 | | Total assets | $510,122 | $538,509 | | Total current liabilities | $97,617 | $115,501 | | Long-term debt, net | $441,292 | $437,635 | | Total liabilities | $592,855 | $608,948 | | Partners' capital (deficit) | $(82,733) | $(70,439) | Consolidated Statements of Operations For the three months ended September 30, 2025, the Partnership reported a net loss of $8.4 million, a significant increase from the $3.3 million net loss in the prior year period. Total revenues slightly decreased, while total costs and expenses increased Consolidated Statements of Operations | Metric | 3 Months 2025 (Thousands of USD) | 3 Months 2024 (Thousands of USD) | 9 Months 2025 (Thousands of USD) | 9 Months 2024 (Thousands of USD) | | :-------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Total revenues | $168,717 | $170,934 | $541,936 | $536,295 | | Total costs and expenses | $162,218 | $158,442 | $507,244 | $487,142 | | Operating income | $6,894 | $12,651 | $36,179 | $50,473 | | Net income (loss) | $(8,412) | $(3,319) | $(11,852) | $3,734 | | Net income (loss) per unit | $(0.21) | $(0.08) | $(0.30) | $0.09 | Consolidated Statements of Capital (Deficit) The Partners' Capital (Deficit) for common limited units widened to $(83,922) thousand as of September 30, 2025, from $(71,877) thousand at December 31, 2024, primarily due to net losses and cash distributions Consolidated Statements of Capital (Deficit) | Metric | Sep 30, 2025 (Thousands of USD) | Dec 31, 2024 (Thousands of USD) | | :-------------------------- | :------------------------------ | :------------------------------ | | Common Limited Units Amount | $(83,922) | $(71,877) | | General Partner Amount | $1,189 | $1,438 | | Total Partners' Capital (Deficit) | $(82,733) | $(70,439) | - The net loss of $(8,244) thousand for the three months ended September 30, 2025, contributed to the widening deficit[45] Consolidated Statements of Cash Flows For the nine months ended September 30, 2025, net cash provided by operating activities significantly increased to $23.7 million from $6.2 million in the prior year period. However, net cash used in investing activities decreased, and net cash used in financing activities shifted from a net cash provided in 2024 to a net cash used in 2025 Consolidated Statements of Cash Flows | Metric | 9 Months 2025 (Thousands of USD) | 9 Months 2024 (Thousands of USD) | | :------------------------------------ | :------------------------------- | :------------------------------- | | Net cash provided by operating activities | $23,683 | $6,184 | | Net cash used in investing activities | $(22,405) | $(49,642) | | Net cash provided by (used in) financing activities | $(1,284) | $43,460 | | Net increase (decrease) in cash | $(6) | $2 | Capitalization, Guidance & Distributions This section details the Partnership's capitalization, credit metrics, the withdrawal of 2025 guidance, and quarterly cash distribution information Capitalization and Credit Metrics Total debt outstanding remained stable at $453.6 million as of September 30, 2025. However, the total adjusted leverage ratio increased to 4.63x from 3.96x at December 31, 2024, while the interest coverage ratio declined. The Partnership remained in compliance with all debt covenants Capitalization and Credit Metrics | Metric | Sep 30, 2025 (Millions of USD) | Dec 31, 2024 (Millions of USD) | | :---------------------------------- | :----------------------------- | :----------------------------- | | Total Debt Outstanding | $453.6 million | $453.6 million | | Revolving Credit Facility - Available Liquidity | $11.4 million | $80.7 million | | Total Adjusted Leverage Ratio | 4.63x | 3.96x | | Senior Leverage Ratio | 0.55x | 0.47x | | Interest Coverage Ratio | 1.85x | 2.14x | - The Partnership was in compliance with all debt covenants as of September 30, 2025, and December 31, 2024[20] Withdrawal of 2025 Guidance Martin Midstream Partners has withdrawn its previously issued full-year 2025 guidance for Adjusted EBITDA, Distributable Cash Flow, and Adjusted Free Cash Flow. This decision was made due to significant uncertainty in the Transportation segment, specifically related to demand softness for inland barge fuel transportation - The Partnership is withdrawing its previously issued 2025 guidance, including Adjusted EBITDA, Distributable Cash Flow, and Adjusted Free Cash Flow[22] - The withdrawal is due to uncertainty in the Transportation segment related to demand softness for inland barge fuel transportation[22] - New guidance will not be provided until there is greater visibility into the factors impacting demand in this segment[2] Quarterly Cash Distribution The Partnership declared a quarterly cash distribution of $0.005 per unit for the quarter ended September 30, 2025, payable on November 14, 2025, to common unitholders of record as of November 7, 2025 - Declared a quarterly cash distribution of $0.005 per unit for the quarter ended September 30, 2025[24] - The distribution is payable on November 14, 2025, to common unitholders of record as of November 7, 2025[24] - Distributions to non-U.S. investors are subject to federal income tax withholding at the highest applicable effective tax rate[25] Non-GAAP Financial Measures This section explains the Partnership's use of non-GAAP financial measures and provides reconciliations to their most directly comparable GAAP financial measures Use of Non-GAAP Financial Information The Partnership utilizes non-GAAP financial measures such as EBITDA, Adjusted EBITDA, Distributable Cash Flow, and Adjusted Free Cash Flow to assess business performance and liquidity, providing insights into asset performance, cash generation for distributions, and comparative operating performance within the midstream energy sector. These measures are supplemental and should be considered alongside GAAP results due to inherent limitations - Non-GAAP financial measures used include EBITDA, Adjusted EBITDA, Distributable Cash Flow, and Adjusted Free Cash Flow[17][28] - These measures help assess financial performance without regard to financing methods, capital structure, or historical cost basis, and evaluate the ability to generate cash for interest, debt, and distributions[30][33][34] - Non-GAAP measures have limitations as they exclude significant GAAP components like interest expense, income tax expense, and depreciation/amortization, and may not be comparable to similarly titled measures of other companies[29][32][37] Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA For the three months ended September 30, 2025, Adjusted EBITDA was $19.3 million, a decrease from $25.1 million in the prior year. For the nine months, Adjusted EBITDA was $74.2 million, down from $87.3 million, reflecting the overall financial performance Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA | Metric | 3 Months 2025 (Thousands of USD) | 3 Months 2024 (Thousands of USD) | 9 Months 2025 (Thousands of USD) | 9 Months 2024 (Thousands of USD) | | :-------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Net income (loss) | $(8,412) | $(3,319) | $(11,852) | $3,734 | | EBITDA | $19,253 | $24,947 | $73,183 | $88,123 | | Adjusted EBITDA | $19,273 | $25,144 | $74,249 | $87,262 | Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA, Distributable Cash Flow, and Adjusted Free Cash Flow For the three months ended September 30, 2025, Distributable Cash Flow was $(3.4) million, a decrease from $2.4 million in the prior year, and Adjusted Free Cash Flow was $(4.7) million, down from $(1.6) million. For the nine months, Distributable Cash Flow was $12.4 million, and Adjusted Free Cash Flow was $9.4 million Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA, Distributable Cash Flow, and Adjusted Free Cash Flow | Metric | 3 Months 2025 (Thousands of USD) | 3 Months 2024 (Thousands of USD) | 9 Months 2025 (Thousands of USD) | 9 Months 2024 (Thousands of USD) | | :---------------------------------------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Net cash provided by (used in) operating activities | $(1,213) | $(15,753) | $23,683 | $6,184 | | Adjusted EBITDA | $19,273 | $25,144 | $74,249 | $87,262 | | Distributable Cash Flow | $(3,405) | $2,357 | $12,355 | $17,537 | | Adjusted Free Cash Flow | $(4,681) | $(1,550) | $9,351 | $(4,990) | Corporate Information This section provides an overview of Martin Midstream Partners, outlines forward-looking statement disclaimers, and lists investor contact information About Martin Midstream Partners Martin Midstream Partners L.P. is a publicly traded limited partnership headquartered in Kilgore, Texas, with diverse operations primarily in the Gulf Coast region. Its main business lines include terminalling, processing, and storage; land and marine transportation; sulfur and sulfur-based products; and marketing, distribution, and transportation services for NGLs and specialty lubricants/grease - Headquartered in Kilgore, Texas, Martin Midstream Partners L.P. is a publicly traded limited partnership with diverse operations primarily in the Gulf Coast region[26] - Primary business lines include terminalling, processing, and storage services; land and marine transportation services; sulfur and sulfur-based products processing; and marketing, distribution, and transportation services for natural gas liquids and specialty lubricants/grease[26] Forward-Looking Statements The report contains forward-looking statements regarding the Partnership's outlook and future events, which are subject to various uncertainties including commodity price volatility, future cash flows, ability to pay distributions, market conditions, governmental regulation, and taxation. The Partnership disclaims any intention or obligation to revise these statements unless required by law - Statements about the Partnership's outlook and future events are forward-looking statements[27] - These statements are subject to uncertainties such as commodity price volatility, future cash flows, ability to pay future distributions, market conditions, governmental regulation, and taxation[27] - The Partnership disclaims any intention or obligation to revise any forward-looking statements, except where required by law[27] Investor Contacts Investor relations inquiries can be directed to Danny Cavin, Director, FP&A and Investor Relations, or Sharon Taylor, EVP & Chief Financial Officer, via email at ir@mmlp.com or by phone at (877) 256-6644 - Investor contacts include Danny Cavin (Director, FP&A and Investor Relations) and Sharon Taylor (EVP & Chief Financial Officer)[38] - Contact information: ir@mmlp.com or (877) 256-6644[38]