Martin Midstream Partners L.p. · NASDAQ:MMLP
Martin Midstream Partners L.p — Investor Day (November 2009)
46 slides from Martin Midstream Partners L.p's investor day presentation, Nov 12, 2009
Slide 1: Martin Midstream Partners L.P. Investor Day
SS Martin Midstream Partners L.P. Investor Day Kilgore, Texas > MIDSTREAMPARTNERS ST November 12, 2009
Slide 2: Forward-Looking Statements
2 Forward-Looking Statements Statements included that are not historical facts (including any statements concerning plans and objectives of management for future operations or economic performance, or assumptions or forecasts related thereto), are forward-looking statements. These statements can be
Slide 3: Use of Non-GAAP Financial Measures
3 Use of Non-GAAP Financial Measures This presentation includes certain non-GAAP financial measures, such as EBITDA, Adjusted EBITDA and Distributable Cash Flow. These non-GAAP financial measures are not meant to be considered in isolation or as a substitute for results prepared in accordance with a
Slide 4: Investor Day Agenda
4 Investor Day Agenda Joe McCreery Vice President - Finance / Head of Investor Relations Ruben Martin President & Chief Executive Officer Bob Dunn Sr. Vice President / Head of Prism Gas Ed Grimm Sr. Vice President / Head of Marine Transportation Matt Yost Vice President - Terminalling & Storage Rube
Slide 5: Company Overview
5 Company Overview
Slide 6: Martin Resource Management Corporation
6 Privately held MRMC owns the General Partner of MMLP and is based in Kilgore, TX Founded in 1951 by R. S. Martin, Jr. Provides outsourcing solutions for Petroleum products and by-products Transportation Marketing Terminalling Primarily operates in Gulf Coast and Southeast U.S. 1,950 employees MRMC
Slide 7: Martin Resource Management Corp (MRMC) and MMLP structure
7 Martin Resource Management Corp (MRMC) Martin Transport Martin Product Sales Midstream Fuel Service Martin Underground Storage Cross Oil Refining & Marketing* Joint Ventures Cardinal Gas Storage Ican Energy Company 100% of General Partner Interest Martin Midstream Partners - (MMLP:NASDAQ) 5,184,81
Slide 8: MRMC & MMLP Pro-Forma Corporate Organization Chart
MRMC & MMLP Pro-Forma Corporate Organization Chart* 8 *Assumes completion of the Cross Dropdown and equity issuance expected to close in November 2009 7,598,980 LP
Slide 9: MMLP's Interests are Aligned with our Unitholders
9 MMLP's Interests are Aligned with our Unitholders After giving effect to the Dropdown and the new equity, our General Partner (MRMC) will own approximately 43.9% of the LP interests, plus an additional 2.0% GP interest Public Unitholders 38.8% LP Interest (Common) 5.2% LP Interest (Subordinated) 5
Slide 10: MMLP's High Quality Customer Base
10 Integrated yet complementary business segments uniquely positions MMLP. This is a key driver of long- term customer relationships Breadth, scale and brand recognition make MMLP a premier supplier of products and services Customers include some of the largest, most profitable businesses in the ene
Slide 11: How MMLP Plays in the Midstream Value Chain
11 How MMLP Plays in the Midstream Value Chain Marine Transportation Terminalling & Storage Natural Gas Services Wellhead Crude Oil & Natural Gas Refining & Processing Storage Consumer Sulfur Services Wellhead Refined / Processed Products
Slide 12: Diversified Cash Flow Profile - Largely Fee-Based
Diversified Cash Flow Profile - Largely Fee-Based Sulfur Services Marine Transportation Terminalling and Storage Natural Gas Services 35-40% 25-30% 20-25% 15-20% Percentages in segments based on estimated 2010 EBITDA contribution, excluding unallocated SG&A and including the effects of the Cross Dro
Slide 13: Our Geographical Diversity
Our Geographical Diversity 13
Slide 14: Operating Segment Overview: Natural Gas Services
14 Operating Segment Overview Natural Gas Services
Slide 15: MMLP - Natural Gas Services
MMLP - Natural Gas Services MMLP's Natural Gas Services segment includes the following key assets Ownership interests in over 870 miles of gathering and transmission pipelines located primarily in East Texas and Northwest Louisiana 50% operating interest in a 285 MMcfd natural gas processing plant w
Slide 16: Natural Gas Services Contract Mix
MMLP - Natural Gas Services MMLP's Natural Gas Services segment contract mix includes the following Percent of Liquids (POL) 45% Pure Fee 36% Percent of Proceeds (POP) 19% Keep whole < 1% Major Customers Include: BP America Production Company EXCO Samson CenterPoint Energy Gas Transmission GMX Resou
Slide 17: Natural Gas Services Outlook & Opportunities
MMLP - Natural Gas Services Our Outlook & Opportunities for Natural Gas Services Substantial opportunities exist to develop grassroots midstream infrastructure in support of Haynesville drilling activities Opportunities also exist to consolidate and improve existing infrastructure MMLP can be a "one
Slide 18: Operating Segment Overview: Marine Transportation
18 Operating Segment Overview Marine Transportation
Slide 19: MMLP - Marine Transportation
MMLP - Marine Transportation Segment's Key Assets 45 inland marine tank barges 18 inland pushboats 5 offshore tug barge units Market Drivers Equipment Supply vs. Demand Economic Activity Refinery Runs & Crack Spreads Equipment Retirement vs. New Floating Storage Adjusted EBITDA to MMLP (1) (in milli
Slide 20: MMLP - Marine Transportation
20 MMLP - Marine Transportation "HSSEQT - First " - OCIMF Member Term vs. Spot - Long vs. Short Revenue Diversity Geographic Business Sector Specialty Products Diverse Internal Customer Base Cost Reductions New Construction Upgrade Existing Equipment Process Automation
Slide 21: Marine Transportation Contract Mix and Outlook
MMLP - Marine Transportation MMLP's Marine Transportation contract mix reflects Major Oil Companies International Trading Companies Martin Family of Companies Underlying Risks Supply/Demand Imbalance Economic Stagnation No Retirements Oil Comes Ashore Our Outlook Consolidate Our Position Improve Cos
Slide 22: Operating Segment Overview: Terminalling & Storage
22 Operating Segment Overview Terminalling & Storage
Slide 23: MMLP - Terminalling & Storage
MMLP - Terminalling & Storage MMLP's Terminalling & Storage business consists of 23 terminal facilities with an aggregate storage capacity of 3.0 million barrels (excluding Cross Dropdown) 17 marine terminals: ~2.6 million barrels of storage capacity 6 inland terminals: ~0.4 million barrels of stora
Slide 24: Terminalling & Storage Marine Terminals
24 Galveston, TX Harbor Island, TX Freeport, TX Port O'Connor, TX Sabine Pass, TX Cameron East, LA Cameron West, LA Venice, LA Galveston Full Service Marine Terminals MMLP - Terminalling & Storage Amelia, LA Berwick, LA Intracoastal City, LA Fourchon, LA Fuel & Lubricant Marine Terminals Intracoasta
Slide 25: Specialty Petroleum Terminals
25 Hard to Handle Products such as: Asphalt ~ 700,000 bbls Distillates ~ 230,000 bbls Residual Fuel Oils ~ 190,000 bbls Molten Sulfur ~ 162,500 Long Tons Sulfuric Acids ~ 420,000 bbls Ammonia ~ 342,000 bbls Ammonium Thiosulfate ~ 35,000 bbls Specialty Terminal Locations: Tampa, FL - Asphalt & Sulfur
Slide 26: Terminalling & Storage Contract Mix and Outlook
MMLP - Terminalling & Storage MMLP's Terminalling & Storage Contract Mix Reflects Cornerstone of MMLP's Fee-Based Cash flow Strength in product & geographic diversity - niche products / markets Will become largest segment, post-Cross Dropdown We See Underlying Risks in the Business as Follows Compet
Slide 27: Operating Segment Overview: Sulfur Services
27 Operating Segment Overview Sulfur Services
Slide 28: MMLP - Sulfur Services
MMLP - Sulfur Services MMLP's Sulfur Services segment includes the following key assets: 3 sulfur prillers (TX & CA) with a combined prilling capacity of 5,000 tons per day 6 sulfur-based fertilizer production plants 1 sulfuric acid plant 1 emulsified sulfur blending plant Profitability Drivers for
Slide 29: Sulfur Services Contract Mix and Outlook
MMLP - Sulfur Services MMLP's Sulfur Service contract mix reflects Typically 1-5 year prilling services agreements with ExxonMobil, Shell, ConocoPhillips, Valero and Motiva that are fee-based "take or pay" in nature, guaranteeing payment to MMLP Typically 1-2 year supply agreements with oil refiners
Slide 30: MMLP - Sulfur Services
MMLP - Sulfur Services 30 Manufactures and markets processed sulfur products, fertilizers, sulfuric acid Fertilizer Plant locations Plainview, TX Odessa, TX Beaumont, TX Texarkana, TX Seneca, IL Salt Lake City, UT 450 Tons per day sulfuric acid plant in Plainview, TX MMLP's Plainview, TX - Sulfuric
Slide 31: MMLP Snapshot & Financial Overview
31 MMLP Snapshot & Financial Overview
Slide 32: Martin Midstream Partners L.P. Trading Summary
Martin Midstream Partners L.P. (NASDAQ: MMLP) Following the closing of the Cross Dropdown and unit purchase, MRMC will own a 43.9% L.P. interest and a 100% G.P. interest in MMLP MMLP is a publicly-traded, diversified MLP with operations in Natural Gas Services Terminalling and Storage Marine Transpo
Slide 33: Significant Milestone Events for MMLP
Significant Milestone Events for MMLP 2002: $55 million Initial Public Offering at $19.00 per unit 2003: $30 million acquisition of marine terminals along the Texas and Louisiana Gulf Coast from Tesoro Petroleum Company 2004: $32 million follow-on equity offering $27 million acquisition of Neches In
Slide 34: MMLP - Historical Financial Overview
34 MMLP - Historical Financial Overview EBITDA = Operating Income + Depreciation & Amortization Capitalization = Total Debt + Partners' Capital
Slide 35: MMLP $325MM Credit Facilities Refinancing
35 MMLP $325MM Credit Facilities Refinancing MMLP's existing revolving credit facility and term loan mature in November of 2010. This afternoon, The Partnership launches its refinancing process continuing on our Plan of Finance articulated in our 3rd Quarter Earnings Call MMLP has selected Wells Far
Slide 36: Business Development & Growth Opportunities
36 Business Development & Growth Opportunities
Slide 37: MMLP Equity Issuance & Cross Dropdown
MMLP Equity Issuance & Cross Dropdown As announced on November 4th, MMLP will issue $20 million in common LP units (715,308 units priced at @$27.96) to be purchased by MRMC. The purpose of they equity and its proceeds are to repay indebtedness of the Partnership Also announced on November 4th, MRMC
Slide 38: Cross Transaction - Description of Dropdown Assets
Cross Transaction - Description of Dropdown Assets MMLP will receive Cross assets, located in Smackover, AR that refine naphthenic lube oils such as: Transformer oils Rubber extenders Base oils for lubricants 7,500 bpd naphthenic lube refinery and over 475,000 barrels of storage capacity The assets
Slide 39: Drivers for Profitability of Cross Assets
Drivers for Profitability of Cross Assets 39 Profitability Drivers for the Cross assets contributed to MMLP include Refinery efficiency (utilization / lube yield maximization) Industrial demand (utility maintenance, metalworking, etc.) Environmental regulation (driving switch to naphthenic lubes for
Slide 40: MMLP's Growth Opportunities for the Cross Assets
MMLP's Growth Opportunities for the Cross Assets New Vacuum Tower (~$17 million investment) MMLP is considering installing a new vacuum tower that will increase yields of higher valued viscosity lubes and reduce yields of asphalt, which is a lower valued finished product The European Union has manda
Slide 41: Other MMLP Potential Growth Opportunities
41 Other MMLP Potential Growth Opportunities Expanded prilling opportunities We anticipate 1-2 additional new priller projects in 2010 and 2011 MRMC has recently entered into a joint venture to design, develop and construct sulfur prilling and granulation systems ("Martin Brimrock") MMLP will have a
Slide 42: MIDSTREAMPARTNERS
— MIDSTREAMPARTNERS 2
Slide 43: MMLP EBITDA definition
43 MMLP calculates EBITDA as follows: operating income (as reported on the Consolidated Statement of Operations) plus depreciation and amortization expense (as reported on the Consolidated Statement of Operations). MMLP currently owns 50% partnership interests in Waskom Gas Processing Company ("Wask
Slide 44: GAAP Reconciliation to EBITDA
44 GAAP Reconciliation to EBITDA (1) Excludes the gains (losses) from the sale of assets and includes distributable cash from unconsolidated entities (2) Excludes the gains (losses) from the sale of assets and gains (losses) from involuntary conversion of assets
Slide 45: Follow up & MMLP Contact Information
45 Follow up & MMLP Contact Information
Slide 46: MIDSTREAMPARTNERS
—- MIDSTREAMPARTNERS 46
Martin Midstream Partners — Investor Day (November 2009) on 6ix