Martin Midstream Partners Reports Increased Distributable Cash Flow and Adjusted EBITDA in 2015 Third Quarter Results
•Distributable Cash Flow From Continuing Operations Increased 53% Compared to the Third Quarter of 2014
•Adjusted EBITDA of $41.4 Million Representing an Increase of 20% Compared to the Third Quarter of 2014
•Distribution Coverage Ratio for Trailing Twelve Months of 1.02 times
KILGORE, Texas, Oct. 28, 2015 (GLOBE NEWSWIRE) -- Martin Midstream Partners L.P. (MMLP) (the "Partnership") announced today its financial results for the quarter ended September 30, 2015.
Ruben Martin, President and Chief Executive Officer of Martin Midstream GP LLC, the general partner of MMLP, said, "We finished the third quarter 2015 with a 0.87 times distribution coverage ratio. For the twelve months ended September 30, 2015 our distribution coverage ratio was 1.02 times. This quarter once again demonstrated the benefit of the diverse nature of our revenue streams even as underlying fundamentals across energy markets are experiencing weakness as we beat our internal cash flow forecast by approximately $2.1 million.
"Looking at our operations, performance for the third quarter included the full positive benefit of our new Arcadia Rail Terminal which is housed within our Natural Gas Services segment and provides us nationwide access to natural gas liquids where previously we were confined to servicing customers within the geographic footprint of trucking capabilities. The true benefit of this asset should be seen in the fourth quarter this year and the first quarter next year as we realize the cash flow from forward sales of butane to the refineries during blending season.
"Our Cardinal Gas Storage operating subsidiary, also within our Natural Gas Services segment, continued its strong year to date performance in the third quarter delivering better than expected cash flow from interruptible business services. Cardinal has now exceeded forecasted cash flow in all four quarters since being wholly-owned by the Partnership. Additionally, we saw an increased distribution from our West Texas LPG Pipeline joint venture of $1.1 million based on new shipping tariffs. We also outperformed our internal forecast in the Terminalling and Storage segment, particularly in our legacy specialty terminals division and at the Smackover refinery, both aided by reduced operating expenses.
"Going forward, our focus continues to be increasing our coverage ratio by improving upon our predominantly refinery-facing lines of business. For the fourth quarter 2015, we are optimistic we can achieve improved results from higher marine utilization and lower repair and maintenance costs. Additionally, we will begin the early seasonal shipment of next spring’s fertilizer volumes, which combined with realized sales in our refinery grade butane business is expected to improve our balance sheet by reducing working capital and providing additional cash flow."
The Partnership's distributable cash flow from continuing operations for the third quarter of 2015 was $29.1 million compared to distributable cash flow from continuing operations for the third quarter of 2014 of $19.1 million, an increase of 53%.
The Partnership's distributable cash flow from continuing operations for the nine months ended September 30, 2015 was $98.1 million compared to distributable cash flow from continuing operations for the nine months ended September 30, 2014 of $60.9 million, an increase of 61%.
The Partnership's adjusted EBITDA from continuing operations for the third quarter of 2015 was $41.4 million compared to adjusted EBITDA from continuing operations for the third quarter of 2014 of $34.5 million, an increase of 20%. Net income for the third quarter of 2015 was $3.3 million, which resulted in a loss per limited partner unit of $0.02 after the incentive distribution rights were allocated to the general partner. As a result of a $30.1 million non-cash reduction in the carrying value of the Partnership's 42.2% unconsolidated investment in Cardinal Gas Storage Partners LLC and a $3.4 million non-cash asset impairment in the Partnership's Marine Transportation segment, the Partnership reported a loss for the third quarter of 2014 of $26.9 million, or $0.82 per limited partner unit.
The Partnership's adjusted EBITDA from continuing operations for the nine months ended September 30, 2015 was $136.8 million compared to adjusted EBITDA from continuing operations for the nine months ended September 30, 2014 of $106.4 million, an increase of 29%. Net income for the nine months ended September 30, 2015 was $31.5 million, or $0.54 per limited partner unit. As a result of a the non-cash charges referenced above, the Partnership reported a net loss of $16.1 million, or $0.54 per limited partner unit for nine months ended September 30, 2014.
Revenues for the third quarter of 2015 were $226.0 million compared to $377.1 million for the third quarter of 2014. Revenues for the nine months ended September 30, 2015 were $782.5 million compared to $1.3 billion for the nine months ended September 30, 2014. The decline in revenues is attributable primarily to significantly lower natural gas liquids prices.
On February 12, 2015, the Partnership exited the natural gas liquids floating storage and trans-loading businesses as a result of the sale of its six liquefied petroleum gas pressure barges, collectively referred to as the "Floating Storage Assets", for $41.3 million. The Partnership recorded a gain on the disposition of $1.5 million.
The Partnership had no net income, distributable cash flow or adjusted EBITDA from discontinued operations related to the Floating Storage Assets in the third quarter of 2015. Distributable cash flow and EBITDA from discontinued operations were negative $0.9 million for the third quarter of 2014. Discontinued operations resulted in a loss of $1.2 million, or $0.04 per limited partner unit, for the third quarter of 2014.
Distributable cash flow and adjusted EBITDA from discontinued operations were $1.2 million for the nine months ended September 30, 2015. The Partnership had net income from discontinued operations for the nine months ended September 30, 2015 of $1.2 million, or $0.02 per limited partner unit.
Distributable cash flow and adjusted EBITDA from discontinued operations were negative $2.0 million for the nine months ended September 30, 2014. Discontinued operations resulted in a loss of $3.0 million, or $0.10 per limited partner unit, for the nine months ended September 30, 2014.
Distributable cash flow, EBITDA and adjusted EBITDA are non-GAAP financial measures which are explained in greater detail below under the heading “Use of Non-GAAP Financial Information.” The Partnership has also included below a table entitled “Reconciliation of EBITDA, Adjusted EBITDA, and Distributable Cash Flow” in order to show the components of these non-GAAP financial measures and their reconciliation to the most directly comparable GAAP measurement.
Included with this press release are the Partnership's consolidated financial statements as of and for the three and nine months ended September 30, 2015 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, to be filed with the Securities and Exchange Commission on October 28, 2015.
Quarterly Cash Distribution
The quarterly cash distribution of $0.8125 per common unit, which was announced on October 22, 2015, is payable on November 13, 2015 to common unitholders of record as of the close of business on November 6, 2015. The ex-dividend date for the cash distribution is November 4, 2015. This distribution reflects an annualized distribution rate of $3.25 per unit.
