Martin Midstream Partners LP (MMLP), Kilgore, Texas, credited ammonium thiosulfate (ATS) for much of the improvement in its fertilizer business in the third quarter. MMLP reported a doubling of the third-quarter operating income in its Sulfur Services segment, which includes both sulfur and fertilizer (GM Oct. 22, p. 26).
“Fertilizer had a very strong quarter, considering the third quarter is our seasonally weakest quarter,” said President and CEO Robert Bondurant in a third-quarter earnings call Oct. 21. “Cash flow for fertilizer was $2.2 million in the third quarter compared to $0.6 million a year ago. We had very strong demand in our ATS product line this year compared to a year ago, accounting for the majority of the improvement.
“Looking forward to the fourth quarter, we plan to take the ATS production facility down for turnaround in November,” he added. “So we will have lower production volumes of ATS, which will limit some of our fixed cost absorption. Offsetting this could be early demand from farmers for AMS product, which we manufacture at Plainview.”
Company-wide, Bondurant said MMLP exceeded its internal EBITDA forecast by over $2 million. “As a result of this stronger third quarter performance, I believe we are positioned to exceed the range of our disclosed EBITDA forecast of $95-$102 million for 2021,” he said. “Our third quarter performance, along with the anticipated fourth quarter performance, will be a significant catalyst to helping us achieve our deleveraging goals. This should set us up for a beneficial refinancing of our high-cost secured notes next fall.”