Compass Minerals (NYSE: CMP), a leading global provider of
essential minerals, today reported fourth-quarter and fiscal 2022
results.
MANAGEMENT COMMENTARY
“This was a transformative year for Compass Minerals, in which
we took several strategic actions," said Kevin S. Crutchfield,
president and CEO. "Through our efforts to expand our essential
minerals portfolio into the adjacent, high-growth markets of
lithium and next-generation fire retardants, we are positioning
ourselves for growth, reducing our weather dependency and building
a foundation for long-term value creation. I am proud of our team
for their commitment to safety and relentless focus on execution
amid a year of significant headwinds, including ongoing
inflationary pressures and sulfate of potash production challenges,
which impacted the short-term financial performance of our Salt and
Plant Nutrition segments. Our successful North American highway
salt bid season has set the stage to improve Salt segment
profitability in fiscal 2023.”
FISCAL 2022 AND RECENT
HIGHLIGHTS
- Strong salt segment sales volumes drove an increase in
consolidated revenue for fourth quarter and fiscal 2022, up 18% and
9% respectively, versus the comparable year-over-year period;
- Average pricing for North America 2022-2023 highway deicing
contracts expected to rise 15% and total committed bid volumes
expected to decline by approximately 9%, compared to the prior
year's bid season;
- Exceptional safety performance with Total Case Incident Rate1
of 1.27 for fiscal 2022, an approximately 56% improvement from the
comparable year-over-year period;
- Achieved several strategic milestones during fiscal 2022 and
early fiscal 2023 including:
- Announced strategic path forward to advance phase-one
development of the company’s North American lithium brine resource,
including naming EnergySource Minerals as the DLE technology
provider, expected attractive project economics and confirmation of
positive phase-one life cycle assessment sustainability
profile;
- Announced and closed $252 million strategic equity partnership
with Koch Minerals & Trading LLC (KM&T) with proceeds
expected to fund the first two years of phase-one lithium
development with the remaining net proceeds used to pay down
debt;
- Announced binding, multiyear supply agreement with LG Energy
Solution to deliver up to 40% of planned phase-one battery-grade
lithium carbonate from Ogden, Utah solar evaporation lithium brine
development for an initial six-year term;
- Completed $45 million equity investment in Fortress North
America (Fortress), a next-generation fire retardant company
focused on reinventing wildfire application technologies,
increasing minority equity ownership stake to approximately
45%;
- Completed sale of South America chemicals business for cash
proceeds of approximately $51.5 million and received the maximum
earnout payment of approximately $18.5 million associated with the
sale of South America specialty plant nutrition business, with
proceeds from both used to reduce debt; and
- Enabled strategic shift toward expanding essential minerals
product portfolio and strengthened the company's financial outlook
through recalibration of the company's dividend and broader capital
allocation policy
- Bolstered senior management team’s lithium industry expertise
through the addition of Lorin Crenshaw, chief financial officer,
and Chris Yandell, head of lithium; and
- Appointed Gareth Joyce, Richard P. Dealy, Melissa M. Miller,
Edward C. Dowling, Jon Chisholm and Shane Wagnon to the company’s
board of directors, deepening the board’s operational, financial,
advanced battery supply chain and human capital management
expertise and experience.
1 Rate of work-related injuries per 100 full-time workers during
a one-year period.
RESULTS2,3
For the Three Months
Ended
For the Twelve Months
Ended
(From continuing operations; in
millions, except per share data)
Sept. 30, 2022
Revenue
$
249.4
$
1,244.1
Operating earnings
7.5
44.4
Adjusted EBITDA*
35.0
187.1
Net loss
(4.9
)
(36.7
)
Net loss per diluted share
(0.14
)
(1.08
)
Adjusted Net Earnings*
0.4
19.8
Adjusted Net Earnings* per diluted
share
$
0.01
$
0.57
*Non-GAAP financial measure. Reconciliations to the most
directly comparable GAAP financial measure are provided in tables
at the end of this press release.
Fiscal 2022 fourth quarter consolidated revenue grew 18% year
over year, driven by increased Salt segment sales volumes and
favorable Plant Nutrition average selling price. Plant Nutrition
SOP average selling price increased 48%, partially offset by
reduced sales volumes year over year. Consolidated operating
earnings of $7.5 million, up $5.4 million year over year, and
adjusted EBITDA of $35.0 million up $2.0 million year over year,
were also driven by strong Salt segment sales volume and the
favorable impact of Plant Nutrition higher average selling price
partially offset by increased production and distribution
costs.
Fiscal 2022 consolidated revenue grew 9% year over year, driven
primarily by higher Salt segment sales volumes. Plant Nutrition SOP
average selling price increased 33%, partially offset by a 29%
decline in sales volumes year over year. Consolidated operating
earnings of $44.4 million, down $62.7 million year over year, and
adjusted EBITDA of $187.1 million, down $53.7 million year over
year, were impacted by increased production and distribution costs
partially offset by the favorable impact of increased pricing in
the Plant Nutrition segment.
2 The company’s fiscal 2022 results in this earnings release
reflect the change in the fiscal year-end from Dec. 31 to Sept. 30.
The fiscal 2022 results are reported for the twelve-month period
from Oct. 1, 2021 to Sept. 30, 2022, and the company has presented
comparable results for the Oct. 1, 2020 to Sept. 30, 2021
period.
3 All amounts in this press release represent results from
continuing operations, except for amounts pertaining to the
condensed consolidated statements of cash flows which include
results from discontinued operations, unless otherwise noted.
SALT BUSINESS SUMMARY
Salt segment fiscal 2022 fourth-quarter revenue totaled $188.9
million, up 18% year over year, driven by a 15% increase in sales
volumes and a 3% increase in average selling price. Fourth-quarter
sales volume increased for both the highway deicing and consumer
and industrial salt businesses from the prior year. Highway deicing
average selling price increased 7% year over year. Consumer and
industrial average selling price increased 5% from prior year due
to continued price increases across most product categories.
Operating earnings decreased 27% to $16.3 million, while EBITDA
declined 17% to $33.1 million from the prior-year period, both
impacted by continued inflationary pressures and increased
production and distribution costs.
For the full fiscal year, Salt segment revenue grew 12% to $1.0
billion from $899.6 million in the comparable 2021 period,
primarily driven by a 11% increase in sales volumes. Highway
deicing sales volumes rose 12% on higher bid season commitments and
consumer and industrial sales volumes grew 6%. Salt segment average
selling price was up 1% year over year. Salt segment generated
$117.4 million in operating earnings and EBITDA of $181.9 million,
down 34% and 27% respectively, from comparable 2021 period results.
Fiscal 2022 operating margins of 12% and EBITDA margins of 18% were
down 820 and 960 basis points respectively, versus the comparable
prior-period results, also driven primarily by continued
inflationary pressures and increased production and distribution
costs.
PLANT NUTRITION BUSINESS
SUMMARY
Plant Nutrition segment fourth-quarter revenue totaled $57.8
million, up 17% year over year, driven by a 48% increase in average
selling price partially offset by a 22% decrease in sales volumes.
Operating earnings totaled $12.6 million for the quarter, up $12.8
million from an operating loss of $0.2 million in the prior-year
period, and EBITDA increased $13.1 million to $21.8 million, as
higher average selling price more than offset reduced sales
volumes, which were impacted by inventory constraints and higher
per-unit costs due to reduced production volumes.
For the full fiscal year, the segment generated $222.3 million
in revenue, 5% below the comparable prior-period results, primarily
due to a 29% decrease in sales volumes, largely offset by a 33%
increase in average selling price. Operating earnings for the full
fiscal year totaled $37.1 million and EBITDA totaled $72.7 million,
up $28.0 million and $27.8 million respectively from the comparable
prior-year period, both impacted by higher average selling price
reflecting strong global fertilizer supply-demand conditions
partially offset by reduced sales volumes due to inventory
constraints and higher per-unit product and logistics costs related
to lower production volumes.
CASH FLOW
Net cash provided by operating activities amounted to $120.5
million for fiscal 2022, down $28.9 million year over year, driven
by reduced earnings.
Net cash used in investing activities was $80.0 million for
fiscal 2022 compared to net cash provided by investing activities
of $253.2 million in the comparable prior-year period, largely
reflecting a substantial decrease in year-over-year asset sale
proceeds and the fiscal 2022 $45 million investment in Fortress.
Capital spending for fiscal 2022 was essentially flat year over
year, totaling $96.7 million versus $93.8 million in the comparable
year-ago period.
Net cash used for financing activities was $14.3 million for
fiscal 2022 compared to $417.5 million in the comparable prior-year
period, primarily reflecting lower net asset sale proceeds which
were applied to debt reduction during the prior year, partially
offset by a year-over-year reduction in dividends paid in fiscal
2022.
The company ended the fiscal year with $181.0 million of
liquidity, comprised of $46.1 million in cash and cash equivalents
and $134.9 million of availability under its $300 million revolving
credit facility. Subsequent to fiscal year-end, the company closed
the previously announced equity transaction with KM&T and
received $252 million in cash, before fees.
FISCAL 2023 OUTLOOK
For fiscal 2023, the company has modified its approach to
providing annual earnings guidance. While demand for deicing salt
is stable over time, the nature of winter weather and the manner in
which customers respond to weather events make forecasting deicing
sales volumes difficult during any single year. Below the company
provides a range of estimated potential earnings outcomes that
consider various winter weather scenarios.
Salt Segment
Mild Winter1
2023 Range2
Strong Winter1
Highway deicing sales volumes (thousands
of tons)
8,000
9,350 - 10,050
11,050
Consumer and industrial sales volumes
(thousands of tons)
2,000
2,000 - 2,150
2,150
Total salt sales volumes (thousands of
tons)
10,000
11,350 - 12,200
13,200
Revenue (in millions)
$895
$990 - $1,065
$1,125
EBITDA (in millions)
$175
$215 - $255
$275
(1)
Mild and Strong Winter scenarios reflect
management estimates of the potential impact to the presented line
items assuming mild or strong winter weather. The company utilizes
an array of information, including historical weather data and
sales-to-commitment outcomes, to develop measures that are then
applied to its 2023 Range to estimate these amounts.
(2)
Range for fiscal 2023 reflects the
company's estimated book of business for the period and assumes
normalized weather conditions and average historical
sales-to-commitment outcomes.
The company’s focus for the Salt segment in 2023 is on improving
profitability to historical levels by adjusting its pricing
strategy and recalibrating its sales mix to areas where it has
natural competitive advantages that result in higher profit
margins. The company's North American highway deicing bidding
process for the 2022-2023 winter season has been completed and the
company expects its average contract price for the upcoming winter
season to be approximately 15% above the prior year's bid season
results. The company estimates that its total committed bid volumes
will decrease by approximately 9% compared to prior-year bid season
results as it prioritizes value over volume. Consistent with prior
years, Compass Minerals expects that approximately 75% of its
highway deicing sales will be achieved in the first half of the
fiscal year.
Plant Nutrition
Segment
2023 Range
Sales volumes (thousands of tons)
265 - 295
Revenue (in millions)
$200 - $240
EBITDA (in millions)
$55 - $70
Within the Plant Nutrition segment, the company expects the
average sales price for the fiscal year to be moderately higher
year over year despite moderating sequentially throughout the year.
Sales volumes in fiscal 2023 are expected to be comparable to the
prior year. The company expects higher production costs due to
adverse weather conditions during the most recent evaporation
season, resulting in higher per-unit processing costs at its Ogden,
Utah facility. The segment is also expected to incur incremental
costs related to operational strategies to mitigate the effects of
ongoing drought conditions in Utah.
Other Assumptions
($ in millions)
2023 Range
Corporate and other expense*
$75 - $80
Depreciation, depletion and
amortization
$95 - $105
Interest expense
$50 - $55
Effective income tax rate (excl. valuation
allowance)
30% - 35%
Capital expenditures:
Sustaining
$100 - $110
Lithium
$75 - $120
Total
$175 - $230
* Corporate and other expense includes operating expenses of $10
to 12 million related to lithium development and non-cash losses of
approximately $5 million related to the equity investment in
Fortress; it excludes depreciation, amortization and stock-based
compensation.
As the company continues to invest in developing its lithium
resource, related operating expenses in the range of $10 to $12
million are projected for fiscal 2023, versus approximately $8
million in fiscal 2022.
Total capital expenditures for fiscal 2023 are projected to be
in the range of $175 million and $230 million, comprised of lithium
development capital spending in the range of $75 million to $120
million (funded by proceeds from recent KM&T transaction) and
sustaining capital spending in the range of $100 million to $110
million.
CONFERENCE CALL
Compass Minerals will discuss its results on a conference call
tomorrow morning, Wednesday, Nov. 30, at 9:30 a.m. ET. To access
the conference call, please visit the company’s website at
investors.compassminerals.com or dial 888-550-5768. Callers must
provide the conference ID number 3632674. Outside of the U.S. and
Canada, callers may dial 646-960-0469. Replays of the call will be
available on the company’s website.
A corporate presentation with fiscal 2022 results is available
at investors.compassminerals.com.
About Compass Minerals
Compass Minerals (NYSE: CMP) is a leading global provider of
essential minerals focused on safely delivering where and when it
matters to help solve nature’s challenges for customers and
communities. The company’s salt products help keep roadways safe
during winter weather and are used in numerous other consumer,
industrial, chemical and agricultural applications. Its plant
nutrition products help improve the quality and yield of crops,
while supporting sustainable agriculture. Additionally, the company
is pursuing development of a sustainable lithium brine resource to
support the North American battery market and is a minority owner
of Fortress North America, a next-generation fire retardant
company. Compass Minerals operates 12 production and packaging
facilities with nearly 2,000 employees throughout the U.S., Canada
and the U.K. Visit compassminerals.com for more information about
the company and its products.
Forward-Looking Statements and Other
Disclaimers
This press release may contain forward-looking statements,
including, without limitation, statements about pricing; the
company's lithium brine development project, including its expected
economics and funding; efforts to expand the company's minerals
portfolio; growth; reduction of weather dependency; value creation;
expected pricing and volumes; and the company's outlook for 2023,
including its expectations regarding sales volumes, revenue,
EBITDA, corporate and other expense, depreciation, depletion and
amortization, interest expense, tax rates, capital expenditures,
operating expenses and Adjusted EBITDA. Forward-looking statements
are those that predict or describe future events or trends and that
do not relate solely to historical matters. We use words such as
“may,” “would,” “could,” “should,” “will,” “likely,” “expect,”
“anticipate,” “believe,” “intend,” “plan,” “forecast,” “outlook,”
“project,” “estimate” and similar expressions suggesting future
outcomes or events to identify forward-looking statements or
forward-looking information. These statements are based on the
company’s current expectations and involve risks and uncertainties
that could cause the company’s actual results to differ materially.
The differences could be caused by a number of factors, including
without limitation (i) weather conditions, (ii) inflation, the cost
and availability of transportation for the distribution of the
company’s products and foreign exchange rates, (iii) pressure on
prices and impact from competitive products, (iv) any inability by
the company to successfully implement its strategic priorities or
its cost-saving or enterprise optimization initiatives, and (v) the
risk that the company may not realize the expected financial or
other benefits from the proposed development of its lithium mineral
resource or its investment in Fortress North America. For further
information on these and other risks and uncertainties that may
affect the company’s business, see the “Risk Factors” and
“Management’s Discussion and Analysis of Financial Condition and
Results of Operations” sections of the company’s Annual Report on
Form 10-K for the period ended Sept. 30, 2022 and its Quarterly
Reports on Form 10-Q for the quarters ended Dec. 31, 2021, March
31, 2022 and June 30, 2022 filed or to be filed with the SEC, as
well as the company's other SEC filings. The company undertakes no
obligation to update any forward-looking statements made in this
press release to reflect future events or developments, except as
required by law. Because it is not possible to predict or identify
all such factors, this list cannot be considered a complete set of
all potential risks or uncertainties.
The company has completed an initial assessment to define the
lithium resource at Compass Minerals’ existing operations in
accordance with applicable SEC regulations, including Subpart 1300.
Pursuant to Subpart 1300, mineral resources are not mineral
reserves and do not have demonstrated economic viability. The
company’s mineral resource estimates, including estimates of the
lithium resource, are based on many factors, including assumptions
regarding extraction rates and duration of mining operations, and
the quality of in-place resources. For example, the process
technology for commercial extraction of lithium from brines with
low lithium and high impurity (primarily magnesium) is still
developing. Accordingly, there is no certainty that all or any part
of the lithium mineral resource identified by the company’s initial
assessment will be converted into an economically extractable
mineral reserve.
Non-GAAP Measures
In addition to using U.S. generally accepted accounting
principles (“GAAP”) financial measures, management uses a variety
of non-GAAP financial measures described below to evaluate the
company’s and its operating segments’ performance. While the
consolidated financial statements provide an understanding of the
company’s overall results of operations, financial condition and
cash flows, management analyzes components of the consolidated
financial statements to identify certain trends and evaluate
specific performance areas.
Management uses EBITDA, EBITDA adjusted for items which
management believes are not indicative of the company’s ongoing
operating performance (“Adjusted EBITDA”) and EBITDA margin to
evaluate the operating performance of the company’s core business
operations because its resource allocation, financing methods and
cost of capital, and income tax positions are managed at a
corporate level, apart from the activities of the operating
segments, and the operating facilities are located in different
taxing jurisdictions, which can cause considerable variation in net
earnings. Management also uses adjusted operating earnings,
adjusted operating margin, adjusted net earnings, and adjusted net
earnings per diluted share, which eliminate the impact of certain
items that management does not consider indicative of underlying
operating performance. The presentation of these measures should
not be construed as an inference that future results will be
unaffected by unusual or non-recurring items. Management believes
these non-GAAP financial measures provide management and investors
with additional information that is helpful when evaluating
underlying performance. EBITDA and Adjusted EBITDA exclude interest
expense, income taxes and depreciation, depletion and amortization,
each of which are an essential element of the company’s cost
structure and cannot be eliminated. In addition, Adjusted EBITDA
and Adjusted EBITDA margin exclude certain cash and non-cash items,
including stock-based compensation. Consequently, any measure that
excludes these elements has material limitations. The non-GAAP
financial measures used by management should not be considered in
isolation or as a substitute for net earnings, operating earnings,
cash flows or other financial data prepared in accordance with GAAP
or as a measure of overall profitability or liquidity. These
measures are not necessarily comparable to similarly titled
measures of other companies due to potential inconsistencies in the
method of calculation. The calculation of non-GAAP financial
measures as used by management is set forth in the following
tables. All margin numbers are defined as the relevant measure
divided by sales. The company does not provide a reconciliation of
forward-looking non-GAAP financial measures to the most directly
comparable financial measures calculated and reported in accordance
with GAAP, as the company is unable to estimate significant
non-recurring or unusual items without unreasonable effort. The
amounts and timing of these items are uncertain and could be
material to the company’s results.
Adjusted operating earnings, adjusted operating earnings margin,
adjusted net earnings, and adjusted net earnings (loss) per diluted
share are presented as supplemental measures of the company’s
performance. Management believes these measures provide management
and investors with additional information that is helpful when
evaluating underlying performance and comparing results on a
year-over-year normalized basis. These measures eliminate the
impact of certain items that management does not consider
indicative of underlying operating performance. These adjustments
are itemized below. Adjusted net earnings (loss) per diluted share
is adjusted net earnings (loss) divided by weighted average diluted
shares outstanding. You are encouraged to evaluate the adjustments
itemized above and the reasons management considers them
appropriate for supplemental analysis. In evaluating these measures
you should be aware that in the future the company may incur
expenses that are the same as or similar to some of the adjustments
presented below.
The following tables reflect financial information for
continuing operations for the three and twelve months ended Sept.
30, 2022 and 2021.
Reconciliation for Adjusted
Net Earnings (Loss)
(unaudited, in millions)
Three months ended
Sept. 30,
Twelve months ended
Sept. 30,
2022
2021
2022
2021
Net (loss) earnings
$
(4.9
)
$
(4.6
)
$
(36.7
)
$
35.6
Executive transition costs, net of
tax(1)
—
—
3.2
—
Accrued loss and legal costs related to
SEC investigation, net of tax(2)
(1.7
)
0.2
.
15.9
3.7
Deferred tax valuation allowance(3)
7.0
—
.
37.4
—
Adjusted net earnings (loss)
$
0.4
$
(4.4
)
$
19.8
$
39.3
Diluted net (loss) earnings per common
share
$
(0.14
)
$
(0.14
)
$
(1.08
)
$
1.00
Adjusted net earnings (loss) per diluted
share
$
0.01
$
(0.14
)
$
0.57
$
1.11
Weighted-average common shares outstanding
(in thousands):
Diluted
34,164
34,099
34,120
34,042
(1)
The company incurred severance and other
costs related to executive transition of $3.8 million ($3.2 million
net of tax) for the twelve months ended Sept. 30, 2022.
(2)
The company recognized costs, net of
reimbursements, related to the recently completed SEC investigation
of $(2.4) million and $0.3 million ($(1.7) million and $0.2 million
net of tax) in the three months ended Sept. 30, 2022 and 2021,
respectively. The company recorded a loss accrual and incurred net
costs related to the recently completed SEC investigation of $17.1
million and $5.0 million ($15.9 million and $3.7 million net of
tax) for the twelve months ended Sept. 30, 2022 and 2021,
respectively.
(3)
The company recognized a valuation
allowance for certain deferred tax assets due to their uncertainty
of being realized.
Reconciliation for Adjusted
Operating Earnings
(unaudited, in millions)
Three months ended
Sept. 30,
Twelve months ended
Sept. 30,
2022
2021
2022
2021
Operating earnings
$
7.5
$
2.1
$
44.4
$
107.1
Executive transition costs(1)
—
—
.
3.8
—
Accrued loss and legal costs related to
SEC investigation(2)
(2.4
)
0.3
.
17.1
5.0
Adjusted operating earnings
$
5.1
$
2.4
$
65.3
$
112.1
Sales
249.4
211.7
1,244.1
1,145.8
Operating margin
3.0
%
1.0
%
3.6
%
9.3
%
Adjusted operating margin
2.0
%
1.1
%
5.2
%
9.8
%
(1)
The company incurred severance and other
costs related to executive transition.
(2)
The company recorded a loss accrual during
the twelve months ended Sept. 30, 2022, and recognized costs, net
of reimbursements, related to the recently completed SEC
investigation during the three and twelve months ended Sept. 30,
2022 and 2021.
Reconciliation for EBITDA and
Adjusted EBITDA
(unaudited, in millions)
Three months ended
Sept. 30,
Twelve months ended
Sept. 30,
2022
2021
2022
2021
Net (loss) earnings from continuing
operations
$
(4.9
)
$
(4.6
)
$
(36.7
)
$
35.6
Interest expense
14.0
13.6
55.2
59.8
Income tax expense (benefit)
7.7
(3.5
)
35.8
5.8
Depreciation, depletion and
amortization
27.7
29.9
110.9
119.9
EBITDA from continuing operations
44.5
35.4
165.2
221.1
Adjustments to EBITDA:
Stock-based compensation - non cash
4.1
1.0
15.7
9.2
(Gain) loss on foreign exchange
(11.4
)
(3.8
)
(14.9
)
5.6
Executive transition costs(1)
—
—
4.3
—
Accrued loss and legal costs related to
SEC investigation(2)
(2.4
)
0.3
17.1
5.0
Other expense (income), net
0.2
0.1
(0.3
)
(0.1
)
Adjusted EBITDA from continuing
operations
35.0
33.0
187.1
240.8
Adjusted EBITDA from discontinued
operations
—
7.0
19.0
51.9
Adjusted EBITDA
$
35.0
$
40.0
$
206.1
$
292.7
EBITDA margin from continuing
operations
17.8
%
16.7
%
13.3
%
19.3
%
Adjusted EBITDA margin from continuing
operations
14.0
%
15.6
%
15.0
%
21.0
%
(1)
The company incurred severance and other
costs related to executive transition.
(2)
The company recorded a loss accrual during
the twelve months ended Sept. 30, 2022, and recognized costs, net
of reimbursements, related to the recently completed SEC
investigation during the three months ended Sept. 30, 2022 and the
twelve months ended Sept. 30, 2022 and 2021.
Salt Segment Performance
(in millions, except for sales volumes and prices per short
ton)
Three months ended
Sept. 30,
Twelve months ended
Sept. 30,
2022
2021
2022
2021
Sales
$
188.9
$
159.5
$
1,010.3
$
899.6
Operating earnings
$
16.3
$
22.4
$
117.4
$
177.7
Operating margin
8.6
%
14.0
%
11.6
%
19.8
%
EBITDA(1)
$
33.1
$
40.1
$
181.9
$
248.4
EBITDA(1) margin
17.5
%
25.1
%
18.0
%
27.6
%
Sales volumes (in thousands of tons):
Highway deicing
1,581
1,329
10,435
9,295
Consumer and industrial
522
496
2,122
1,997
Total Salt
2,103
1,825
12,557
11,292
Average sales prices (per ton):
Highway deicing
$
61.89
$
57.92
$
61.34
$
61.40
Consumer and industrial
$
174.36
$
166.45
$
174.45
$
164.67
Total Salt
$
89.79
$
87.42
$
80.45
$
79.67
(1)
Non-GAAP financial measure.
Reconciliations follow in these tables.
Reconciliation for Salt
Segment EBITDA
(unaudited, in millions)
Three months ended
Sept. 30,
Twelve months ended
Sept. 30,
2022
2021
2022
2021
Reported GAAP segment operating
earnings
$
16.3
$
22.4
$
117.4
$
177.7
Depreciation, depletion and
amortization
16.8
17.7
64.5
70.7
Segment EBITDA
$
33.1
$
40.1
$
181.9
$
248.4
Segment sales
188.9
159.5
1,010.3
899.6
Segment EBITDA margin
17.5
%
25.1
%
18.0
%
27.6
%
Plant Nutrition Segment
Performance
(dollars in millions, except for
prices per short ton)
Three months ended
Sept. 30,
Twelve months ended
Sept. 30,
2022
2021
2022
2021
Sales
$
57.8
$
49.3
$
222.3
$
235.0
Operating earnings (loss)
$
12.6
$
(0.2
)
$
37.1
$
9.1
Operating margin
21.8
%
(0.4
) %
16.7
%
3.9
%
EBITDA(1)
$
21.8
$
8.7
$
72.7
$
44.9
EBITDA(1) margin
37.7
%
17.6
%
32.7
%
19.1
%
Sales volumes (in thousands of tons)
62
79
286
403
Average sales price (per ton)
$
929
$
627
$
777
$
583
(1)
Non-GAAP financial measure.
Reconciliations follow in these tables.
Reconciliation for Plant
Nutrition Segment EBITDA
(unaudited, in millions)
Three months ended
Sept. 30,
Twelve months ended
Sept. 30,
2022
2021
2022
2021
Reported GAAP segment operating (loss)
earnings
$
12.6
$
(0.2
)
$
37.1
$
9.1
Depreciation, depletion and
amortization
9.2
8.9
35.6
35.8
Segment EBITDA
$
21.8
$
8.7
$
72.7
$
44.9
Segment sales
57.8
49.3
222.3
235.0
Segment EBITDA margin
37.7
%
17.6
%
32.7
%
19.1
%
COMPASS MINERALS
INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(unaudited, in millions,
except share and per-share data)
Three Months Ended
Twelve Months Ended
Sept. 30,
Sept. 30,
2022
2021
2022
2021
Sales
$
249.4
$
211.7
$
1,244.1
$
1,145.8
Shipping and handling cost
65.0
45.4
379.5
295.8
Product cost
144.8
133.2
666.6
619.8
Gross profit
39.6
33.1
198.0
230.2
Selling, general and administrative
expenses
32.1
31.0
153.6
123.1
Operating earnings
7.5
2.1
44.4
107.1
Other expense/(income):
Interest expense
14.0
13.6
55.2
59.8
(Gain) loss on foreign exchange
(11.4
)
(3.8
)
(14.9
)
5.6
Net loss in equity investees
1.9
0.3
5.3
0.5
Other expense (income), net
0.2
0.1
(0.3
)
(0.2
)
Earnings (loss) before income taxes from
continuing operations
2.8
(8.1
)
(0.9
)
41.4
Income tax expense (benefit) from
continuing operations
7.7
(3.5
)
35.8
5.8
Net (loss) earnings from continuing
operations
(4.9
)
(4.6
)
(36.7
)
35.6
Net (loss) earnings from discontinued
operations
(2.0
)
(51.4
)
12.2
(220.8
)
Net loss
$
(6.9
)
$
(56.0
)
$
(24.5
)
$
(185.2
)
Basic net (loss) earnings from continuing
operations per common share
$
(0.14
)
$
(0.14
)
$
(1.08
)
$
1.01
Basic net (loss) earnings from
discontinued operations per common share
(0.06
)
(1.51
)
0.36
(6.49
)
Basic net loss per common share
$
(0.20
)
$
(1.65
)
$
(0.73
)
$
(5.48
)
Diluted net (loss) earnings from
continuing operations per common share
$
(0.14
)
$
(0.14
)
$
(1.08
)
$
1.00
Diluted net (loss) earnings from
discontinued operations per common share
(0.06
)
(1.51
)
0.36
(6.49
)
Diluted net loss per common share
$
(0.20
)
$
(1.65
)
$
(0.73
)
$
(5.48
)
Cash dividends per share
$
0.15
$
0.72
$
0.60
$
2.88
Weighted-average common shares outstanding
(in thousands):(1)
Basic
34,164
34,043
34,120
33,999
Diluted
34,164
34,099
34,120
34,042
(1) Excludes weighted participating securities such as RSUs and
PSUs that receive non-forfeitable dividends, which consist of
360,000 and 407,000 weighted participating securities for the three
and twelve months ended Sept. 30, 2022, respectively, and 402,000
and 414,000 weighted participating securities for the three and
twelve months ended Sept. 30, 2021, respectively.
COMPASS MINERALS
INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(unaudited, in
millions)
Sept. 30,
Sept. 30,
2022
2021
ASSETS
Cash and cash equivalents
$
46.1
$
18.1
Receivables, net
167.2
132.8
Inventories
302.2
321.7
Current assets held for sale
—
9.9
Other current assets
43.7
48.9
Property, plant and equipment, net
780.2
830.5
Equity method investments
46.6
5.8
Intangible and other noncurrent assets
258.3
263.2
Total assets
$
1,644.3
$
1,630.9
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current portion of long-term debt
$
—
$
—
Current liabilities held for sale
—
9.6
Other current liabilities
233.1
185.8
Long-term debt, net of current portion
947.6
935.4
Deferred income taxes and other noncurrent
liabilities
206.6
207.0
Total stockholders' equity
257.0
293.1
Total liabilities and stockholders'
equity
$
1,644.3
$
1,630.9
COMPASS MINERALS
INTERNATIONAL, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(unaudited, in
millions)
Twelve Months Ended
Sept. 30,
2022
2021
Net cash provided by operating
activities(1)
$
120.5
$
149.4
Cash flows from investing activities:
Capital expenditures(2)
(96.7
)
(93.8
)
Proceeds from sale of businesses
61.2
348.6
Investments in equity method investees
(46.3
)
(5.0
)
Other, net
1.8
3.4
Net cash (used in) provided by investing
activities
(80.0
)
253.2
Cash flows from financing activities:
Proceeds from revolving credit facility
borrowings
466.2
505.1
Principal payments on revolving credit
facility borrowings
(403.1
)
(516.9
)
Proceeds from the issuance of long-term
debt
55.9
120.6
Principal payments on long-term debt
(109.1
)
(427.3
)
Dividends paid
(20.8
)
(98.0
)
Deferred financing costs
(0.4
)
(0.1
)
Proceeds from stock option exercised
0.3
1.6
Shares withheld to satisfy employee tax
obligations
(2.0
)
(1.3
)
Other, net
(1.3
)
(1.2
)
Net cash used in financing activities
(14.3
)
(417.5
)
Effect of exchange rate changes on cash
and cash equivalents
(1.1
)
1.8
Net change in cash and cash
equivalents
25.1
(13.1
)
Cash and cash equivalents, beginning of
the year
21.0
34.1
Cash and cash equivalents, end of
period
46.1
21.0
Less: cash and cash equivalents included
in current assets held for sale
—
(2.9
)
Cash and cash equivalents of continuing
operations, end of period.
$
46.1
$
18.1
(1)
Includes cash flows provided by (used in)
discontinued operations of $9.4 million and $(369.3) million for
the twelve months ended Sept. 30, 2022 and 2021, respectively.
(2)
Includes capital expenditures of $1.6
million and $9.8 million related to discontinued operations for the
twelve months ended Sept. 30, 2022 and 2021, respectively. Capital
expenditures related to continuing operations were $95.1 million
and $84.0 million for the twelve months ended Sept. 30, 2022 and
2021, respectively.
COMPASS MINERALS
INTERNATIONAL, INC.
SEGMENT INFORMATION
(unaudited, in
millions)
Three Months Ended Sept. 30,
2022
Salt
Plant Nutrition
Corporate and Other(1)
Total
Sales to external customers
$
188.9
$
57.8
$
2.7
$
249.4
Intersegment sales
—
1.4
(1.4
)
—
Shipping and handling cost
59.3
5.7
—
65.0
Operating earnings (loss)(2)
16.3
12.6
(21.4
)
7.5
Depreciation, depletion and
amortization
16.8
9.2
1.7
27.7
Total assets
1,022.0
475.1
147.2
1,644.3
Three Months Ended Sept. 30,
2021
Salt
Plant Nutrition
Corporate and Other(1)
Total
Sales to external customers
$
159.5
$
49.3
$
2.9
$
211.7
Intersegment sales
—
1.5
(1.5
)
—
Shipping and handling cost
39.1
6.3
—
45.4
Operating earnings (loss)(2)
22.4
(0.2
)
(20.1
)
2.1
Depreciation, depletion and
amortization
17.7
8.9
3.3
29.9
Total assets
1,040.2
458.9
121.9
1,621.0
Twelve Months Ended Sept. 30,
2022
Salt
Plant Nutrition
Corporate and Other(1)
Total
Sales to external customers
$
1,010.3
$
222.3
$
11.5
$
1,244.1
Intersegment sales
—
6.4
(6.4
)
—
Shipping and handling cost
353.3
26.2
—
379.5
Operating earnings (loss)(2)
117.4
37.1
(110.1
)
44.4
Depreciation, depletion and
amortization
64.5
35.6
10.8
110.9
Twelve Months Ended Sept. 30,
2021
Salt
Plant Nutrition
Corporate and Other(1)
Total
Sales to external customers
$
899.6
$
235.0
$
11.2
$
1,145.8
Intersegment sales
—
6.9
(6.9
)
—
Shipping and handling cost
262.7
33.1
—
295.8
Operating earnings (loss)(2)
177.7
9.1
(79.7
)
107.1
Depreciation, depletion and
amortization
70.7
35.8
13.4
119.9
(1)
Corporate and other includes corporate
entities, records management operations, equity method investments
and other incidental operations and eliminations. Operating
earnings (loss) for corporate and other includes indirect corporate
overhead including costs for general corporate governance and
oversight, lithium-related expenditures, as well as costs for the
human resources, information technology, legal and finance
functions.
(2)
Corporate operating results include
reimbursements related to the recently completed SEC investigation
of $2.4 million for the three months ended Sept. 30, 2022. The
twelve months ended Sept. 30, 2022 results include executive
transition costs of $3.8 million and a loss accrual and net costs
related to the recently completed SEC investigation of $17.1
million. Corporate operating results also include costs related to
the recently completed SEC investigation of $0.3 million and $5.0
million for the three and twelve months ended Sept. 30, 2021,
respectively.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221129005975/en/
Investor Contact Brent Collins Vice President, Investor
Relations +1.913.344.9111 InvestorRelations@compassminerals.com
Media Contact Rick Axthelm Chief Public Affairs and
Sustainability Officer +1.913.344.9198
MediaRelations@compassminerals.com
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