Martin Midstream Partners, L.P.



Martin Midstream Partners L.P. provides marine transportation, terminaling, distribution and midstream logistical services for producers and suppliers of hydrocarbon products and by-products, lubricants and other liquids.  It also manufactures and markets sulfur-based fertilizers and related products.  The partnership operates primarily in the Gulf region, which a major hub for petroleum refining, natural gas processing and support services to the offshore exploration and production industry.


Martin Midstream organizes its operations into four general lines of business that can be summarized as follows:


Ø    Marine Transportation Business. Martin Midstream owns a marine fleet of 34 inland tank barges, 12 inland pushboats and two offshore tug/barge tanker units that transport hydrocarbon products and by-products. It provides these transportation services on a fee basis primarily under annual contracts. The marine transportation system operates on the United States inland waterway system, primarily between domestic ports along the Gulf of Mexico Intracoastal Waterway, the Mississippi River system and the Tennessee-Tombigbee Waterway system.


Ø    Terminaling Business. The partnership owns or operates 16 marine terminal facilities and two inland terminal facilities that provide storage and handling services for hydrocarbon products and by-products, lubricants, and other liquids. The nine product tanks Martin Midstream owns at these facilities have an aggregate storage capacity of approximately 879,000 barrels. Martin Midstream charges a fixed fee for terminaling services and has several long-term terminaling contracts with customers.


Ø    LPG Distribution Business. The partnership purchases LPGs primarily from oil refiners and natural gas processors and store them in its supply and storage facilities for resale to propane retailers and industrial LPG users in Texas and the southeastern United States. Martin Midstream owns three LPG supply and storage facilities with an aggregate storage capacity of approximately 132,000 gallons and leases approximately 128 million gallons of underground storage capacity. The partnership generally tries to coordinate its sales and purchases of LPGs based on the same daily price index for LPGs in order to decrease the impact of LPG price fluctuations on its profitability.


Ø    Fertilizer Business. Martin Midstream manufactures and sells fertilizer products, which are primarily sulfur-based, and other sulfur related products to regional wholesale distributors and industrial users.


Martin Midstream receives a material portion of its net income and cash available for distribution from its unconsolidated non-controlling 49.5% limited partner interest in CF Martin Sulphur, L.P., a limited partnership formed by Martin Resource Management and CF Industries, Inc. in November 2000. CF Martin Sulphur collects and aggregates, transports, stores and markets molten sulfur supplied by oil refiners and natural gas processors.


Martin Midstream Partners’ business strategy is to:


Ø    Expand services provided to existing customers.  Martin Midstream typically begins customer relationships by transporting or marketing a limited number of products, or providing a limited range of other services.  It believes that expanding services and products provided to existing customers is the most efficient means of expansion, and that there is significant opportunity to do so.


Ø    Pursue strategic acquisitions.  Martin Midstream pursues acquisitions that will expand either its products and services offerings or its geographic presence.  After acquiring a business, it endeavors to use its knowledge and experience to operate the business more cost effectively, thereby generating increased revenues and cash flow.


Ø    Attract new customers in existing geographic markets.  For marine transportation these are the Gulf Coast and southern inland waterways.  Fertilizer products are sold throughout the United States, and industrial sulfur products primarily in the eastern United States.


Ø    Expand geographically.  Martin Midstream typically enters a new market through an acquisition or by securing at least one major customer or supplier and then dedicating or purchasing assets for operation in the new market. Once in a new territory, it seeks to expand operations there both by targeting new customers and by selling additional services and products to the original customers in the territory.


Ø    Pursue strategic alliances.  Many larger customers are establishing strategic alliances with midstream logistics management service providers to address logistical and transportation problems or achieve operational synergies. Martin Midstream intends to pursue such alliances with its significant customers.


The partnership cites a number of competitive strengths that it believes make it well positioned to execute its business strategy.  These include:


Ø    A diversified asset base which, together with the services provided by Martin Resource Management, provides customers with an integrated distribution network consisting of transportation, terminaling and midstream logistical services while minimizing dependence on the availability and pricing of services provided by third parties.


Ø    Strategically located terminal facilities.  The partnership believes itself to be one of the largest providers of shore bases, one of the largest lubricant distributors, and one of the largest operators of marine service terminals in the Gulf Coast region.


Ø    Specialized transportation equipment and storage facilities.  Martin Midstream has the expertise to handle certain hydrocarbon products and byproducts with unique requirements for transportation and storage, such as molten sulfur, asphalt, and sulfuric acid.


Ø    Experienced management team and operational expertise. Members of Martin Midstream’s management team have, on average, more than 23 years of experience in the industries in it operates, and have worked for the company for  an average of 20 years.


Ø    Strong industry reputation and established relationships with suppliers and customers.  Martin Midstream believes it has established an industry reputation as a provider of reliable and cost-effective services and a record of safe, efficient operation of its facilities.  It has established long-term relationships with many of its customers.


Ø    Financial flexibility provided by borrowings available under the partnership’s revolving credit facility and by its ability to issue new partnership equity.


Martin Midstream Partners is traded on the NASDAQ under the symbol MMLP.  For further information contact Scott D. Martin at 713-350-6800 or visit Martin Midstream’s website at

Financial Information from 2003 10-K
(in thousands, except per unit amounts)
Nov. 6 -- 
Dec. 31, 2002
Jan. 1 -- Nov. 5, 2002
Market value(1)
Current assets
Net property plant and equipment
Total assets
Current liabilities
Long-term debt
Partnership capital
Operating income (2)
Net income(2)
Net income/unit(2)
High unit price
Low unit price
(1)  As of June 30, 2003 and December 31, 2002.
(2)  Martin Midstream Partners’ initial public offering was on November 6, 2002.  
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