Compass Minerals (NYSE: CMP), a leading global provider of
essential minerals, today reported fiscal 2023 first-quarter
results.
MANAGEMENT COMMENTARY
"Compass Minerals is off to a mixed start in fiscal year 2023.
While we saw improved results within our Salt business and made
progress on our strategic priorities, weak demand in our Plant
Nutrition segment and cost pressures are tempering our financial
performance and outlook," said Kevin S. Crutchfield, president and
CEO. "Consolidated sales revenue, operating earnings, and adjusted
EBITDA for the quarter all increased year over year. From a
strategic standpoint, we were successful in realizing an
improvement in the profitability of our Salt business during the
quarter, and saw meaningful progress within one of our key growth
pillars with Fortress announcing the addition of two aerial fire
retardants to the U.S. Forest Service's Qualified Product List. In
the lithium business, we closed the strategic equity placement with
Koch Minerals & Trading during the quarter, providing funding
for a substantial portion of phase-one lithium development while
enhancing our financial standing. As we look forward to the rest of
the year, we are focused on maintaining and improving upon the
operational performance we've achieved and navigating the uncertain
short-term price and demand dynamics related to our premium sulfate
of potash fertilizer business. We will also address the challenges
being caused by cost pressures across the business by executing on
opportunities to reduce our cost structure where appropriate."
Mr. Crutchfield continued, "We are committed to building a
foundation for long-term value creation here at Compass Minerals.
We're making important strides in our efforts to accelerate growth
and reduce weather dependency through expansion of our essential
minerals portfolio into adjacent, high-growth markets while
optimizing the earnings potential of our existing businesses. As we
execute on our plans, I am confident that we will unlock the
significant value embedded in our company."
FISCAL 2023 FIRST-QUARTER
HIGHLIGHTS
- Generated 6% year-over-year growth in consolidated revenue
driven by strong pricing in both Salt and Plant Nutrition
businesses and improved Salt volumes;
- Continued on path to fully restoring Salt segment profitability
to historic levels with first quarter operating earnings and EBITDA
increasing 17% and 7%, respectively, year over year on a per-ton
basis;
- Closed the gross $252 million strategic equity investment by
Koch Minerals & Trading LLC (KM&T) with $200 million in
proceeds expected to fund the first two years of phase-one lithium
development; remaining net proceeds used to pay down debt during
the quarter; and
- Progressed Fortress North America (Fortress), a next-generation
fire-retardant company of which Compass Minerals owns 45%, toward
full commercialization through the qualification of two aerial
long-term fire retardants on the U.S. Forest Service’s (USFS)
Qualified Product List (QPL).
FINANCIAL RESULTS1
(in millions, except per share
data)
Three Months Ended Dec.
31, 2022
Revenue
$
352.4
Operating earnings
27.9
Adjusted EBITDA*
61.8
Net loss
(0.3
)
Net loss per diluted share
(0.01
)
Adjusted net earnings*
(0.1
)
Adjusted net earnings* per diluted
share
—
*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 2023 first quarter consolidated revenue grew 6% year over
year, driven by higher prices in both business segments and
stronger Salt segment sales volumes, partially offset by weaker
sales volumes in the Plant Nutrition segment. Consolidated
operating earnings of $27.9 million were up 37% from $20.4 million
in the corresponding quarter in fiscal 2022, with operating margins
improving to 7.9% from 6.2%. Consolidated adjusted EBITDA improved
to $61.8 million in the quarter, up 6% year over year. Consolidated
adjusted EBITDA margin was essentially flat at 17.5% compared to
17.6% last year.
1 All amounts in this press release represent results from
continuing operations, except for amounts pertaining to the fiscal
2022 condensed consolidated statements of cash flows which include
results from discontinued operations, unless otherwise noted.
SALT BUSINESS SUMMARY
Salt fiscal 2023 first-quarter revenue totaled $308.1 million,
up 12% year over year, driven by a 10% increase in average sales
price and a 2% increase in segment sales volumes. Management's
commercial focus on value over sales volume during the recent
highway bidding season was evident in the Salt segment results,
which showed improvement toward profitability more in line with
historical levels, driven in part by highway deicing average
selling price for the period increasing 12% year over year to
$65.60 per ton. Average winter weather enabled the Salt segment to
show volume growth year over year despite the company narrowing its
service market to higher margin geographies, with highway deicing
sales volumes up 3% year over year.
Consumer and industrial average selling price increased 9% from
the prior year driven by continued price increases across most
product categories, while sales volumes were down 2% year over year
due to timing of water care sales and slightly weaker consumer
deicing demand.
For the segment, per-unit distribution costs rose 14% year over
year, reflecting higher fuel and logistics costs. Operating costs
per ton were up 6% year over year due to the inflationary
environment over the last year.
Higher average sales prices and sales volumes tempered by
increased costs resulted in operating earnings increasing 20% year
over year to $47.1 million, while also driving increased EBITDA to
$61.0 million, up 10% from the prior-year period.
PLANT NUTRITION BUSINESS
SUMMARY
Plant Nutrition first-quarter revenue totaled $41.6 million,
down 24% year over year. While the average segment sales price for
the quarter was up 40% year over year, segment sales volumes were
down 46%. A combination of recent drought conditions in California
and grower expectations of lower future prices caused many
customers to rescind or defer normal levels of fertilizer
purchases. Year over year, per-ton distribution costs increased
19%, reflecting increased fuel rates and fewer sales volumes to
absorb fixed expenses. Operating costs increased 26% over the
comparable quarter in the prior year due primarily to the
inflationary environment over the last twelve months.
Despite strong pricing, weak sales volumes and higher costs in
the quarter resulted in muted profitability. Operating earnings
totaled $11.0 million for the quarter, up from operating earnings
of $9.5 million in the prior-year period. EBITDA increased to $19.3
million versus $18.3 million in the comparable period of fiscal
2022.
GROWTH INITIATIVES
UPDATE
In December 2022, Fortress announced that its two primary aerial
long-term fire retardants had been upgraded to fully qualified
status on the USFS QPL, becoming the first new company in over
twenty years to reach that milestone. This status change provides
positive momentum for the Fortress team ahead of the 2023 wildfire
season and allows the USFS, as well as others who use the QPL for
purchasing policies, to begin purchasing those approved products
for widespread use.
Regarding the development of the company’s lithium brine
resource at its Ogden, Utah facility, Compass Minerals remains on
track to complete its FEL-2 engineering estimate by the end of the
fiscal 2023 second quarter.
CASH FLOW
Net cash provided by operating activities amounted to $2.1
million for the three months ended Dec. 31, 2022, compared to net
cash used by operating activities of $14.3 million in the prior
year. The improvement year over year is principally due to higher
operating earnings and reduced working capital requirements.
Net cash used in investing activities was $20.1 million in the
first quarter of fiscal 2023 compared to net cash used in investing
activities of $41.2 million in the comparable prior-year period,
which included approximately $28 million related to the company’s
investment in Fortress. Total capital spending for the first
quarter of fiscal 2023 was $19.9 million, which included
approximately $2 million in capital spending related to the
company's lithium growth opportunity.
Net cash provided by financing activities was $117.7 million for
the three months ended Dec. 31, 2022, compared to $63.3 million in
the comparable prior-year period. The significant items affecting
the quarter were closing the $252 million gross ($240.7 million,
net of fees) strategic equity investment by KM&T partially
offset by debt reduction of $116.1 million.
The company ended the quarter with $432.6 million of liquidity,
comprised of $146.1 million in cash and cash equivalents and $286.5
million of availability under its $300 million revolving credit
facility.
UPDATED FISCAL 2023
OUTLOOK
The company has provided updated commentary regarding its 2023
financial outlook.
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 profitability range for the Salt segment across various
weather scenarios remains unchanged from the company's prior
guidance. However, at this time, the company's expectation is that
results are more likely to come in below the midpoint of the 2023
Range based on higher production costs and below-trend sales to
commitment ratios fiscal year-to-date through January in select
geographies with relatively heavy commitment levels. Costs are
being impacted primarily by higher natural gas costs consumed at
the company's Ogden facility.
The company's strategic focus for the Salt segment in 2023
remains 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. For the current deicing season, this resulted in a lower
volume of total sales commitments compared to prior-year bid season
results, reflecting a prioritization of value over volume.
Plant Nutrition
Segment
2023 Range
Sales volumes (thousands of tons)
205 – 270
Revenue (in millions)
$155 - $225
EBITDA (in millions)
$30 - $60
The company’s full-year outlook for Plant Nutrition has declined
and widened from its prior guidance range, reflecting lower
full-year sales volumes than previously assumed based on
year-to-date trends, heightened uncertainty regarding sulfate of
potash (SOP) fertilizer pricing and higher production costs.
In the first fiscal quarter, a combination of drought conditions
in California, the company's largest market for SOP, and
just-in-time customer buying behavior led to sharply lower
purchases, resulting in lower-than-expected sales volumes. This
dynamic has been followed by torrential rains and flooding in the
second fiscal quarter that has created considerable uncertainty
regarding whether application rates resembling historical levels
will be realized this spring.
Production costs are anticipated to be higher as a result of
increased natural gas prices at the company's Ogden facility,
driven by supply and demand dynamics in that geography.
Other Assumptions
($ 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)
45% - 50%
Capital expenditures:
Sustaining
$90 - $100
Lithium
$75 - $120
Total
$165 - $220
* 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 million to
$12 million are projected for fiscal 2023, versus approximately $8
million in fiscal 2022 – unchanged from its prior forecast.
Projected total capital expenditures for fiscal 2023 have been
lowered to a range of $165 million to $220 million, comprised of
lithium development capital spending in the range of $75 million to
$120 million (funded by proceeds from the recent KM&T
transaction) - unchanged from the company's prior estimate - and
sustaining capital spending in the range of $90 million to $100
million, down $10 million from the company's prior estimate.
CONFERENCE CALL
Compass Minerals will discuss its results on a conference call
tomorrow morning, Wednesday, Feb. 8, at 9:30 a.m. ET (8:30 a.m.
CT). 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 supporting corporate presentation with fiscal 2023 first
quarter 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 expected costs;
pricing; efforts to create value, accelerate growth, reduce weather
dependency and expand our minerals portfolio; earnings potential;
the company's lithium brine development project, including its
expected expenses, economics and funding; the company's investment
in Fortress; and the company's outlook for fiscal 2023, including
its expectations regarding sales volumes, revenue, EBITDA,
corporate and other expense, depreciation, depletion and
amortization, interest expense, tax rates, and capital
expenditures. 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 Report on
Form 10-Q for the quarter ended Dec. 31, 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.
Reconciliation for Adjusted
Net (Loss) Earnings
(unaudited, in millions)
Three Months Ended Dec.
31,
2022
2021
Net (loss) earnings from continuing
operations
$
(0.3
)
$
7.9
Executive transition costs, net of
tax(1)
—
2.8
Accrued loss and legal costs related to
SEC investigation, net of tax(2)
0.2
2.3
Adjusted net (loss) earnings from
continuing operations
$
(0.1
)
$
13.0
Net (loss) earnings from continuing
operations per diluted share
$
(0.01
)
$
0.23
Adjusted net earnings from continuing
operations per diluted share
$
—
$
0.38
Weighted-average common shares outstanding
(in thousands):
Diluted
39,751
34,089
(1)
The company incurred severance and other
costs related to executive transition of $3.3 million ($2.8 million
net of tax) for the three months ended Dec. 31, 2021.
(2)
The company recognized costs, net of
reimbursements, related to the settled SEC investigation of $0.3
million and $3.1 million ($0.2 million and $2.3 million net of tax)
in the three months ended Dec. 31, 2022 and 2021, respectively.
Reconciliation for Adjusted
Operating Earnings
(unaudited, in millions)
Three Months Ended Dec.
31,
2022
2021
Operating earnings
$
27.9
$
20.4
Executive transition costs(1)
—
3.3
Accrued loss and legal costs related to
SEC investigation(2)
0.3
3.1
Adjusted operating earnings
$
28.2
$
26.8
Sales
352.4
331.5
Operating margin
7.9
%
6.2
%
Adjusted operating margin
8.0
%
8.1
%
(1)
The company incurred severance and other
costs related to executive transition.
(2)
The company recognized costs, net of
reimbursements, related to the settled SEC investigation during the
three months ended Dec. 31, 2022 and 2021.
Reconciliation for EBITDA and
Adjusted EBITDA
(unaudited, in millions)
Three Months Ended Dec.
31,
2022
2021
Net (loss) earnings from continuing
operations
$
(0.3
)
$
7.9
Interest expense
13.9
13.9
Income tax expense (benefit)
11.9
(1.2
)
Depreciation, depletion and
amortization
23.9
28.3
EBITDA from continuing operations
49.4
48.9
Adjustments to EBITDA from continuing
operations:
Stock-based compensation - non cash
10.6
3.2
Interest income
(1.1
)
(0.3
)
Loss (gain) on foreign exchange
2.5
(0.4
)
Executive transition costs(1)
—
3.8
Accrued loss and legal costs related to
SEC investigation(2)
0.3
3.1
Other expense, net
0.1
0.1
Adjusted EBITDA from continuing
operations
61.8
58.4
Adjusted EBITDA from discontinued
operations
—
8.6
Adjusted EBITDA including discontinued
operations
$
61.8
$
67.0
(1)
The company incurred severance and other
costs related to executive transition.
(2)
The company recognized costs, net of
reimbursements, related to the settled SEC investigation during the
three months ended Dec. 31, 2022 and 2021.
Salt Segment
Performance
(unaudited, in millions, except
for sales volumes and prices per short ton)
Three Months Ended Dec.
31,
2022
2021
Sales
$
308.1
$
273.9
Operating earnings
$
47.1
$
39.4
Operating margin
15.3
%
14.4
%
EBITDA(1)
$
61.0
$
55.6
EBITDA(1) margin
19.8
%
20.3
%
Sales volumes (in thousands of tons):
Highway deicing
2,901
2,807
Consumer and industrial
620
633
Total Salt
3,521
3,440
Average prices (per ton):
Highway deicing
$
65.60
$
58.34
Consumer and industrial
$
190.04
$
174.00
Total Salt
$
87.51
$
79.63
(1)
Non-GAAP financial measure.
Reconciliations follow in these tables.
Reconciliation for Salt
Segment EBITDA
(unaudited, in millions)
Three Months Ended Dec.
31,
2022
2021
Reported GAAP segment operating
earnings
$
47.1
$
39.4
Depreciation, depletion and
amortization
13.9
16.2
Segment EBITDA
$
61.0
$
55.6
Segment sales
308.1
273.9
Segment EBITDA margin
19.8
%
20.3
%
Plant Nutrition Segment
Performance
(unaudited, dollars in millions,
except for sales volumes and prices per short ton)
Three Months Ended Dec.
31,
2022
2021
Sales
$
41.6
$
54.6
Operating earnings
$
11.0
$
9.5
Operating margin
26.4
%
17.4
%
EBITDA(1)
$
19.3
$
18.3
EBITDA(1) margin
46.4
%
33.5
%
Sales volumes (in thousands of tons)
45
83
Average price (per ton)
$
924
$
660
(1)
Non-GAAP financial measure.
Reconciliations follow in these tables.
Reconciliation for Plant
Nutrition Segment EBITDA
(unaudited, in millions)
Three Months Ended Dec.
31,
2022
2021
Reported GAAP segment operating
earnings
$
11.0
$
9.5
Depreciation, depletion and
amortization
8.3
8.8
Segment EBITDA
$
19.3
$
18.3
Segment sales
41.6
54.6
Segment EBITDA margin
46.4
%
33.5
%
COMPASS MINERALS
INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(unaudited, in millions,
except share and per-share data)
Three Months Ended Dec.
31,
2022
2021
Sales
$
352.4
$
331.5
Shipping and handling cost
107.4
95.7
Product cost
175.0
175.9
Gross profit
70.0
59.9
Selling, general and administrative
expenses
42.1
39.5
Operating earnings
27.9
20.4
Other (income) expense:
Interest income
(1.1
)
(0.3
)
Interest expense
13.9
13.9
Loss (gain) on foreign exchange
2.5
(0.4
)
Net loss in equity investee
0.9
0.4
Other expense, net
0.1
0.1
Earnings from continuing operations before
income taxes
11.6
6.7
Income tax expense (benefit) from
continuing operations
11.9
(1.2
)
Net (loss) earnings from continuing
operations
(0.3
)
7.9
Net loss from discontinued operations
—
(5.5
)
Net (loss) earnings
$
(0.3
)
$
2.4
Basic net (loss) earnings from continuing
operations per common share
$
(0.01
)
$
0.23
Basic net loss from discontinued
operations per common share
—
(0.16
)
Basic net (loss) earnings per common
share
$
(0.01
)
$
0.07
Diluted net (loss) earnings from
continuing operations per common share
$
(0.01
)
$
0.23
Diluted net loss from discontinued
operations per common share
—
(0.16
)
Diluted net (loss) earnings per common
share
$
(0.01
)
$
0.07
Weighted-average common shares outstanding
(in thousands):(1)
Basic
39,751
34,060
Diluted
39,751
34,089
(1)
Weighted participating securities include
RSUs and PSUs that receive non-forfeitable dividends and consist of
514,000 weighted participating securities for the three months
ended Dec. 31, 2022, and 430,000 weighted participating securities
for the three months ended Dec. 31, 2021.
COMPASS MINERALS
INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(unaudited, in
millions)
Dec. 31,
Sept. 30,
2022
2022
ASSETS
Cash and cash equivalents
$
146.1
$
46.1
Receivables, net
202.2
167.2
Inventories
301.0
304.4
Other current assets
35.4
44.3
Property, plant and equipment, net
774.8
776.6
Equity method investments
45.7
46.6
Intangible and other noncurrent assets
259.5
258.3
Total assets
$
1,764.7
$
1,643.5
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current portion of long-term debt
$
—
$
—
Other current liabilities
218.7
233.1
Long-term debt, net of current portion
832.1
947.6
Deferred income taxes and other noncurrent
liabilities
204.1
206.4
Total stockholders' equity
509.8
256.4
Total liabilities and stockholders'
equity
$
1,764.7
$
1,643.5
COMPASS MINERALS
INTERNATIONAL, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(unaudited, in
millions)
Three Months Ended Dec.
31,
2022
2021
Net cash provided by (used in) operating
activities(1)
$
2.1
$
(14.3
)
Cash flows from investing activities:
Capital expenditures(2)
(19.9
)
(14.5
)
Investments in equity method investees
—
(28.2
)
Other, net
(0.2
)
1.5
Net cash used in investing activities
(20.1
)
(41.2
)
Cash flows from financing activities:
Proceeds from revolving credit facility
borrowings
16.7
162.4
Principal payments on revolving credit
facility borrowings
(168.2
)
(122.8
)
Proceeds from issuance of long-term
debt
35.4
32.5
Principal payments on long-term debt
—
(3.3
)
Net proceeds from private placement of
common stock
240.7
—
Dividends paid
(6.3
)
(5.3
)
Proceeds from stock options exercised
—
0.2
Shares withheld to satisfy employee tax
obligations
(0.3
)
—
Other, net
(0.3
)
(0.4
)
Net cash provided by financing
activities
117.7
63.3
Effect of exchange rate changes on cash
and cash equivalents
0.3
0.1
Net change in cash and cash
equivalents
100.0
7.9
Cash and cash equivalents, beginning of
the year
46.1
21.0
Cash and cash equivalents, end of
period
146.1
28.9
Less: cash and cash equivalents
included in current assets held for sale
—
(8.6
)
Cash and cash equivalents of continuing
operations, end of period
$
146.1
$
20.3
(1)
Includes cash flows provided by
discontinued operations of $5.0 million in 2021.
(2)
Includes capital expenditures of $0.7
million related to discontinued operations in 2021.
COMPASS MINERALS
INTERNATIONAL, INC.
SEGMENT INFORMATION
(unaudited, in
millions)
Three Months Ended Dec. 31,
2022
Salt
Plant Nutrition
Corporate &
Other(1)
Total
Sales to external customers
$
308.1
$
41.6
$
2.7
$
352.4
Intersegment sales
—
2.9
(2.9
)
—
Shipping and handling cost
102.7
4.7
—
107.4
Operating earnings (loss)(2)
47.1
11.0
(30.2
)
27.9
Depreciation, depletion and
amortization
13.9
8.3
1.7
23.9
Total assets (as of end of period)
985.2
456.5
323.0
1,764.7
Three Months Ended Dec. 31,
2021
Salt
Plant Nutrition
Corporate &
Other(1)
Total
Sales to external customers
$
273.9
$
54.6
$
3.0
$
331.5
Intersegment sales
—
2.4
(2.4
)
—
Shipping and handling cost
88.4
7.3
—
95.7
Operating earnings (loss)(2)
39.4
9.5
(28.5
)
20.4
Depreciation, depletion and
amortization
16.2
8.8
3.3
28.3
Total assets (as of end of period)
1,035.4
445.3
206.7
1,687.4
(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 costs,
net of reimbursements, related to the settled SEC investigation of
$0.3 million and $3.1 million for the three months ended Dec. 31,
2022 and 2021, respectively. In addition, the three months ended
Dec. 31, 2021 include executive transition costs of $3.3
million.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230207005864/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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