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MARTIN MIDSTREAM PARTNERS L.P. (MMLP)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 missed internal guidance, with Adjusted EBITDA of $23.3M vs $29.0M guided, driven primarily by weak marine utilization and hurricane-related disruptions in land transport; net loss was $(8.9)M including $3.7M merger-termination costs .
  • FY 2024 Adjusted EBITDA was $110.6M (below guidance by ~$5.5M), and 2025 guidance was set at $109.1M Adjusted EBITDA with $34.9M capex (maintenance/turnaround $25.9M, growth $9.0M) and projected Adjusted FCF of ~$18.8M .
  • Merger with MRMC was terminated Dec 26, 2024; management emphasized balance sheet focus ahead of 2028 note refinancing (total debt $453.6M; adjusted leverage 3.96x at 12/31/24) .
  • Street consensus (S&P Global) was unavailable at the time of writing, so we cannot benchmark Q4 results versus external estimates; internal guidance variances and 2025 outlook are key stock narrative drivers*.

What Went Well and What Went Wrong

  • What Went Well

    • Sulfur Services outperformed: Q4 segment Adjusted EBITDA $9.4M vs $7.6M guidance, aided by fertilizer volume/mix and pure sulfur margin strength; ELSA reservation fee began contributing in Q4 .
    • Specialty Products held in line with guidance: Q4 Adjusted EBITDA $4.5M vs $4.6M guided; stronger lubricant/grease margins offset weaker propane volumes from warm winter weather .
    • Liquidity remained adequate with $80.7M available on revolver at year-end, supporting near-term flexibility while management prioritizes deleveraging (adjusted leverage 3.96x) .

  • What Went Wrong

    • Transportation missed materially: Q4 Adjusted EBITDA $6.5M vs $11.2M guided; marine utilization for heated barges fell with refinery slowdowns, and Florida trucking was disrupted by Hurricane Milton .
    • Terminalling & Storage underperformed: Q4 Adjusted EBITDA $7.4M vs $9.4M guided due to Smackover operating challenges and hurricane-related maintenance at specialty terminals .
    • Headline GAAP loss impacted by non-recurring costs: Q4 net loss $(8.9)M included $3.7M merger termination expenses; FY24 came in below guidance by ~$5.5M concentrated in Q4 .

Financial Results

Q4 performance vs prior quarter and prior year

MetricQ4 2023Q3 2024Q4 2024
Revenues ($M)$181.1 $170.9 $171.3
Net Income (Loss) ($M)$0.5 $(3.3) $(8.9)
EPS ($/unit)$0.01 $(0.08) $(0.22)
Adjusted EBITDA ($M)$29.2 $25.1 $23.3
Net Cash from Ops ($M)$31.4 $(15.8) $42.2
Distributable Cash Flow ($M)$8.5 $2.4 $2.8

Q4 segment Adjusted EBITDA ($M): YoY

SegmentQ4 2023Q4 2024
Transportation12.0 6.5
Terminalling & Storage9.0 7.4
Sulfur Services7.4 9.4
Specialty Products4.9 4.5
Unallocated SG&A(4.1) (4.4)
Total Adjusted EBITDA29.2 23.3

Balance sheet & cash KPIs

KPI12/31/202312/31/2024
Total Debt Outstanding ($M)442.5 453.6
Revolver Capacity ($M)175.0 150.0
Available Liquidity ($M)109.0 80.7
Total Adjusted Leverage (x)3.75x 3.96x
Interest Coverage (x)2.19x 2.14x
Quarterly Distribution ($/unit)—$0.005 (declared for Q4’24)

Non-GAAP notes and adjustments: Q4 included $3.7M in merger-termination transaction expenses; Q4 Adjusted EBITDA reconciles from net loss with interest, taxes, D&A, and adjustments (including the transaction expense and a non-cash revenue deferral) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent Guidance/ActualChange
Total Adjusted EBITDA ($M)Q4 2024$29.0 (pre-SG&A reconciliation provided) $23.3 actual Lower/Miss vs guidance
Transportation Adj EBITDA ($M)Q4 2024$11.2 $6.5 Lower/Miss
Terminalling & Storage Adj EBITDA ($M)Q4 2024$9.4 $7.4 Lower/Miss
Sulfur Services Adj EBITDA ($M)Q4 2024$7.6 $9.4 Raised/Beat
Specialty Products Adj EBITDA ($M)Q4 2024$4.6 $4.5 In line
Total Adjusted EBITDA ($M)FY 2025N/A$109.1 (segment pre-SG&A: $123.8; unallocated SG&A $(14.7)) Initiated
Transportation Adj EBITDA ($M)FY 2025N/A$35.4 Initiated
Terminalling & Storage Adj EBITDA ($M)FY 2025N/A$35.6 Initiated
Sulfur Services Adj EBITDA ($M)FY 2025N/A$31.9 (incl. $2.8M DSM Semichem) Initiated
Specialty Products Adj EBITDA ($M)FY 2025N/A$20.8 Initiated
Maintenance + Turnaround Capex ($M)FY 2025N/A$25.9 Initiated
Growth Capex ($M)FY 2025N/A$9.0 Initiated
Interest Expense (net) ($M)FY 2025N/A$51.1 Initiated
Income Taxes (net) ($M)FY 2025N/A$4.2 Initiated
Distributable Cash Flow ($M)FY 2025N/A$27.8 Initiated
Adjusted Free Cash Flow ($M)FY 2025N/A$18.8 Initiated

Earnings Call Themes & Trends

Note: No Q4 2024 earnings call transcript was available in the document set; themes below reflect Q2 and Q3 disclosures vs Q4 press release.

TopicQ2 2024 (Prior-2)Q3 2024 (Prior-1)Q4 2024 (Current)Trend
ELSA project & DSM SemichemGrowth capex focused on ELSA; project progressing Feedstock timing slid to Oct; reservation fee to start 10/1; 2025 sales likely muted near term Reservation fee recognized in Q4; contributes to Sulfur Services; 2025 EBITDA includes $2.8M DSM Monetization beginning; commercial ramp slower
Marine barge rates/utilizationMarine impacted by casualty/allision and inspections; day rates higher Heated barge rates $11k–$11.5k/day; clean ~$9.6k–$9.8k; stable to slightly up; good Q4 outlook Q4 underperformed as refinery activity slowed; lower heated utilization Rates firm; utilization variable with refinery cadence
Hurricane/weather impactsCasualty reserves (Smackover pipe spill; bridge allision) Hurricane Milton: Florida assets largely okay; modest repair capex $0.5–$1.0M Land trucking in Central FL disrupted early Q4; specialty terminals maintenance costs elevated Weather headwinds persisted into Q4
Specialty Products demandIn line in Q2; grease strength offset packaged lubes weakness Weaker lubricant/grease demand amid slowing economy; Q4 seasonally softer expected In line overall; propane volumes weak on warm winter; lubes/grease margins better Mixed: margin resilience vs volume softness
Balance sheet/leverageTotal adjusted leverage 3.88x; focus on debt reduction Aim <4.0x by YE; no change to MMLP structure from potential MRMC buyout YE leverage 3.96x; strategy refocused on deleveraging and 2028 notes refi post-merger termination Deleveraging remains priority
M&A / Corporate actions—MRMC merger agreement announced; to proceed to proxy Merger terminated 12/26; standalone go-forward strategy Takeout removed; internal execution focus

Management Commentary

  • “For the fourth quarter and full year 2024 the Partnership generated Adjusted EBITDA of $23.3 million and $110.6 million, respectively, which was below our annual guidance level by approximately $5.5 million... We ended the year with an adjusted leverage ratio of 3.96 times based on Credit Adjusted EBITDA...” .
  • “Transportation... the marine business experienced much lower levels of utilization for our heated barges... Results for the land transportation business were negatively impacted early in the quarter by Hurricane Milton in Central Florida...” .
  • “Sulfur Services... benefited from increased sales volumes... and the revenue related to the guaranteed reservation fee, beginning this quarter as part of the improvements to our Plainview, Texas facility for the ELSA project.” .
  • “The Partnership expects to generate Adjusted EBITDA of $109.1 million in 2025... We anticipate capital expenditures for growth, maintenance, and plant turnaround costs to be $34.9 million... Adjusted Free Cash Flow of approximately $18.8 million” .
  • “Our focus should remain on improving the balance sheet through debt reduction... to strengthen the Partnership’s position when the time arrives to refinance our outstanding notes due in 2028.” .

Q&A Highlights

No Q4 2024 earnings call transcript was found. Context from Q3 call:

  • ELSA ramp/timing: feedstock start in Oct; reservation fee commenced 10/1; 2025 ELSA sales likely muted pending customer qualifications .
  • Marine markets: heated day rates $11k–$11.5k/day; clean ~$9.6k–$9.8k; stable rates with tightness; mix of term and spot .
  • Hurricane Milton repairs: ~$0.5–$1.0M repair capex at Tampa/Mulberry; minimal commercial impact expected .
  • FY25 cash generation (pre-Q4 guidance): management indicated improved FCF potential as capex normalizes post-ELSA .

Estimates Context

  • Street consensus (S&P Global) for Q4 2024 EPS/Revenue was unavailable at the time of writing due to data access limitations. As a result, external “vs estimates” comparisons are not included. We benchmarked performance versus company guidance and prior periods instead .
  • Implications: Q4’s sizable underperformance vs internal guidance in Transportation and Terminalling & Storage likely forces downward revisions to near-term segment expectations, partially offset by higher Sulfur Services contribution (ELSA fees). 2025 Adjusted EBITDA guide of $109.1M suggests a flat-to-slightly down year vs 2024 actual ($110.6M), implying limited upside without operational execution improvements in transport utilization and stable refinery activity .

Key Takeaways for Investors

  • Q4 miss concentrated in marine utilization and hurricane-driven land transport disruptions; Sulfur Services was a bright spot aided by ELSA reservation fees—execution on transport utilization and weather normalization are near-term swing factors .
  • 2025 guide implies flat EBITDA YoY ($109.1M vs $110.6M FY24), with DCF of $27.8M and Adjusted FCF of $18.8M after $34.9M total capex—capital allocation and deleveraging remain center stage into the 2028 notes refi window .
  • Post-merger termination, the standalone path increases emphasis on operational improvements and debt reduction; at YE, leverage was 3.96x with $80.7M liquidity—balance sheet progress is a key narrative driver .
  • Specialty Products showed margin resilience despite softer demand; propane volumes are weather-sensitive (warm winter); discipline in pricing/mix and cost control remain important .
  • Q4 non-recurring merger-termination costs ($3.7M) weighed on GAAP loss; focus on non-GAAP trends (Adjusted EBITDA, DCF) helps isolate core operations .
  • Watch refinery operating cadence (marine heated utilization), barge day rates, and ELSA commercialization updates; each can move quarterly results materially .
  • Distribution remains de minimis ($0.005/unit for Q4), consistent with debt reduction priorities and covenant constraints near-term .

* S&P Global consensus data was unavailable at time of writing.