Martin cuts back

Martin Midstream Partners reported revenue improvements in both its terminal and barge businesses, but headwinds in 2009 are leading the company to sell assets.

Chief executive Ruben Martin said in a conference call Thursday that the company is in the process of selling two pairs of deepwater tugs and barges.

Terminal for sale

Also, Martin Midstream is in negotiations with a potential buyer of a "non-strategic" terminal. The deal would bring in $24m in proceeds.

The Nasdaq-listed company has reported 3.5% revenue growth in its barge fleet, which brought in $20.5m.

Martin Midstream is in the process of selling a marine terminal.Terminalling and storage revenues gained by 23.9% to $9.72m, an improvement from $7.84m in the same period of 2007.

Overall, the company reported net profits of $16.7m during the quarter, a 117% improvement compared to the fourth quarter of the prior year. The $1.08 in earnings per share beat the average analyst estimate of $0.90.

Chief executive Ruben Martin tied much of the rise to an "outstanding quarter" in the company's sulphur sales. In addition to transportation and terminalling, Martin Midstream has natural gas and sulphur services business.

“Given the overall challenging economic conditions, I am pleased to say that we performed extremely well in the fourth quarter," the chief executive said.

But in 2009, he says the company faces headwinds not present a year ago from the combination "financial malaise" and litigation impacting parent Martin Resource Management.

Growth spending cut

The firm is responding by reducing capital growth expenditures, in addition to selling "non-strategic assets."

For the year, Martin Midstream's profits were $42.8m, a 71.9% improvement.

Based in Kilgore, Texas, Martin Midstream operates 16 marine terminals for petroleum products. It has a fleet of inland and deepwater tugs and tank-barges, which operate in the spot market or on one- to 12-month time-charters.

The company's shares slid by 2.7% to $16.16 in late-afternoon trading.