Martin Midstream Partners L.p. · NASDAQ:MMLP
Martin Midstream Partners L.p — 9th Annual Pipeline, MLP & Energy Symposium December 2010
41 slides from Martin Midstream Partners L.p's conference presentation, Dec 7, 2010
Slide 1: 9th Annual Pipeline, MLP & Energy Symposium December 2010
9th Annual Pipeline, MLP & Energy Symposium December 2010
Slide 2: Forward-Looking Statements
Forward-Looking Statements 2 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
Use of Non-GAAP Financial Measures 3 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 gener
Slide 4: Martin Resource Management Corporation (MRMC) Our Parent and General Partner
Martin Resource Management Corporation (MRMC) Our Parent and General Partner Closely held corporation based in Kilgore, TX - Founded in 1951 by R. S. Martin, Jr. Leading independent provider of integrated logistics solutions and marketing & distribution services to energy, petrochemical and other in
Slide 5: MRMC support and ownership structure of MMLP
5 Over the past 50 years, MRMC has developed infrastructure and brand reputation in petroleum product and by-products that now support MMLP Structured to support the Partnership Maintains distinct set of assets and business units Demonstrated historical support Over $100MM invested through unit purc
Slide 6: Martin Resource Management Corp structure and significant operating entities
6 Martin Resource Management Corp Martin Transport (MTI) Martin Product Sales (MPS) Midstream Fuel Service (MFS) Cross Oil Refining & Marketing Joint Ventures Cardinal Gas Storage Ican Energy Company 100% of General Partner Interest Martin Midstream Partners - (MMLP:NASDAQ) 6,593,267 Limited Partner
Slide 7: Martin Midstream Partners LP Overview
7 Listed: NASDAQ GS: MMLP October 31, 2002 MRMC owns a ~35% L.P. interest and 100% G.P. interest in MMLP MMLP is a publicly-traded, diversified MLP with operations: Natural Gas Services Terminalling and Storage Marine Transportation Sulfur Services MMLP Trading Summary (1) Unit Price: $37.33 Market
Slide 8: Significant Milestone Events for MMLP
8 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
Slide 9: Disciplined Growth Through Acquisitions
Typical Acquisition Criteria Modest size (less than $100MM) Strongly prefer non-competitive, "under the radar" situations Substantial prior knowledge of each acquired entity (as customer or supplier) Consistent use of equity to finance acquisitions within target leverage (3.0x - 3.5x) 9 $30MM Marine
Slide 10: Exceptional LP Unitholder Returns since IPO
10 Exceptional LP Unitholder Returns since IPO Total Return to Unit holders (including cash distributions) Since IPO (11/2002) 202.0% CAGR 14.7% Current Yield 8.0% MMLP Unit Performance
Slide 11: Growing Fee-Based Cash Flow Concentration
11 Terminalling and Storage: Multi-year, fee-based Specialized products have fee minimums Natural Gas Services: Stable, margin-based wholesale NGLs Multi-year up to life of reserves for gathering and processing Sulfur Services: Take-or-pay prilling Stable, margin-based molten sulfur Stable, margin-b
Slide 12: Marquee Customer Base
12 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 ener
Slide 13: Fully Integrated Service Provider
13 Fully Integrated Service Provider Broad provider of products and services in energy-focused regions through: Specialized equipment and facilities to store and transport hard-to-handle products Lubricant distributors and marketers Marine service terminals Coast-to-coast integrated sulfur infrastru
Slide 14: MMLP Areas of Operation
14 MMLP Areas of Operation
Slide 15: Operating Segment Overview
Operating Segment Overview
Slide 16: MMLP's Diversified Operating Mix
16 MMLP's Diversified Operating Mix Sulfur Services Marine Transportation Terminalling & Storage Natural Gas Services 35-40% 25-30% 20-25% 15-20% PRO FORMA 2010 EBITDA Mix Marine Transportation Transportation services for petroleum products and by-products Natural Gas Services Gathering and processi
Slide 17: MMLP - Terminalling & Storage Overview
17 MMLP's Terminalling & Storage business consists of 23 terminal facilities with an aggregate storage capacity of 3.6 million barrels 17 marine terminals: ~2.6 million barrels of storage capacity 6 inland terminals: ~0.4 million barrels of storage capacity Cross naphthenic lube processing facility
Slide 18: Terminalling & Storage - Cross Oil
November 2009 drop-down from a subsidiary of MRMC for $45MM in MMLP units 7,500 bpd capacity in Smackover, AR ~ 10% total US market share Specialized refinery that converts crude oil into naphthenic lubricants for high quality, customized industrial uses: Transformer oils Rubber extenders Base oils
Slide 19: Terminalling & Storage - Marine Terminals
19 Galveston, TX Harbor Island, TX Freeport, TX Port O'Connor, TX Sabine Pass, TX Cameron East, LA Cameron West, LA Venice, LA Galveston Amelia, LA Berwick, LA Intracoastal City, LA Fourchon, LA Fuel & Lubricant Marine Terminals Intracoastal City Lubricant Terminal Houston (Channelview), TX Full Ser
Slide 20: Terminalling & Storage - Specialty Terminals
Expertise in "hard to handle" products such as: Asphalt ~ 700,000 bbls Distillates ~ 230,000 bbls Residual fuel oils ~ 190,000 bbls Molten sulfur ~ 53,000 long tons Prilled sulfur ~ 150,000 long tons Sulfuric acids ~ 420,000 bbls Ammonia ~ 342,000 bbls Ammonium thiosulfate ~ 35,000 bbls Specialty Te
Slide 21: Operating Segment Overview Natural Gas Services
Operating Segment Overview Natural Gas Services
Slide 22: MMLP - Natural Gas Services Segment Overview
22 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 MMcf/d natural gas processing plant with full fractionation c
Slide 23: Natural Gas Services - Integrated Solutions
Locked-in, higher Natural Gas Services - Integrated Solutions 23 Wet Gas Liquids separated under fee-based POP or POL pricing arrangements Third party purchasers (Pipelines, trucks) Martin storage facilities Third party purchasers NGLs Martin wholesale propane business MTI. Belvieu Propane retailers
Slide 24: MMLP - Natural Gas Services Segment
24 MMLP - Natural Gas Services Segment 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 Transmissio
Slide 25: Operating Segment Overview Sulfur Services
Operating Segment Overview Sulfur Services
Slide 26: MMLP - Sulfur Services Overview
MMLP - Sulfur Services Overview 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 dri
Slide 27: MMLP - Sulfur Services Integrated Value Chain
27 Refinery Gas Fertilizer Production Industrial Uses International Demand Beaumont, TX Stockton, CA Tampa, FL Truck, Barge, Rail Truck, Barge, Rail Barge Barge Prilling (take or pay) Molten Form China, Brazil, Morocco * Martin can take physical delivery at this point Beaumont, TX (Neches, Stanolind
Slide 28: 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 and natural gas produc
Slide 29: MMLP - Sulfur Services - Fertilizer
MMLP - Sulfur Services - Fertilizer 29 Manufactures and markets processed sulfur products, fertilizers, and sulfuric acid Regional fertilizer plant locations with strong leading localized market share positions: Plainview, TX Odessa, TX Beaumont, TX Texarkana, TX Seneca, IL Salt Lake City, UT 450 to
Slide 30: MMLP - Fee Based, Cross Segment Integration
MMLP - Fee Based, Cross Segment Integration Neches Terminal, Beaumont, TX
Slide 31: Operating Segment Overview Marine Transportation
Operating Segment Overview Marine Transportation
Slide 32: MMLP - Marine Transportation Overview
MMLP - Marine Transportation Overview Segment's Key Assets 45 inland marine tank barges 18 inland push-boats 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 (in
Slide 33: MMLP - Marine Transportation
33 "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 MMLP - Marine Transportation
Slide 34: MMLP - Marine Transportation Overview
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 34 MMLP - Marine Transportation Overview Launch of MMLP 321 Inland Barge
Slide 35: MMLP Investment Considerations
35 Four fully integrated and complementary business segments that span the midstream value chain Proven Management Consistently conservative leverage profile (3.0x - 3.5x) with sustained growth Majority of cash flows are fee-based with minimal commodity exposure High quality, stable base of leading
Slide 36: Appendix: Adjusted EBITDA Reconciliations
APPENDIX ADJUSTED EBITDA RECONCILIATIONS
Slide 37: Adjusted EBITDA Reconciliation - 3Q 2010
37 Adjusted EBITDA Reconciliation - 3Q 2010
Slide 38: Adjusted EBITDA Reconciliation - 2009
38 Adjusted EBITDA Reconciliation - 2009
Slide 39: Adjusted EBITDA Reconciliation - 2008
39 Adjusted EBITDA Reconciliation - 2008
Slide 40: Adjusted EBITDA Reconciliation - 2007
40 Adjusted EBITDA Reconciliation - 2007
Slide 41: Privately Held - MRMC; Publicly Traded - Martin Midstream Partners L.P.
Privately Held - Martin Resource Management Corporation Publicly Traded - Martin Midstream Partners L.P.
Martin Midstream Partners — 9th Annual Pipeline, MLP & Energy Symposium December 2010 on 6ix