Intrepid Potash, Inc. ("Intrepid", the "Company", "we", "us", or
"our") (NYSE:IPI) today reported its results for the second quarter
of 2024.
Key Highlights for Second Quarter 2024
Financial & Operational
- Total sales of $62.1 million, which compares to $81.0 million
in the second quarter of 2023.
- Net loss of $0.8 million (or $0.06 per diluted share), which
compares to net income of $4.3 million (or $0.33 per diluted share)
in the second quarter of 2023.
- Gross margin of $7.6 million, which compares to $15.4 million
in the second quarter of 2023.
- Cash flow provided by operations of $27.7 million, which
compares to $30.5 million in the second quarter of 2023.
- Adjusted EBITDA(1) of $9.2 million, which compares to $15.8
million in the second quarter of 2023.
- Potash and Trio® sales volumes of 55 thousand and 63 thousand
tons, respectively, which compares to 79 thousand and 63 thousand
tons, respectively, in the second quarter of 2023.
- Potash and Trio® average net realized sales prices(1) of $405
and $314 per ton, respectively, which compares to $479 and $333 per
ton, respectively, in the second quarter of 2023.
Management & Board of Directors Update
- On July 10, 2024, we announced that the Board of Directors
(“the Board”) of Intrepid elected Barth Whitham, formerly Lead
Independent Director, as its Chair. On that date, the Board also
announced that it initiated a search process to identify a
successor for Intrepid’s CEO, Bob Jornayvaz, who is currently out
on an extended medical leave of absence, as it is unlikely that Mr.
Jornayvaz will return to his CEO role. During this process,
Intrepid’s CFO, Matt Preston, will continue to serve as acting
principal executive officer, working closely with the rest of the
Company’s management team and the Board.
Capital Expenditures
- Capital expenditures were $11.3 million in the second quarter
of 2024, bringing our total capital expenditures to $23.0 million
for the first six months ended June 30, 2024. We continue to expect
full-year 2024 capital expenditures of $40 million to $50
million.
Project & Operational Updates
- HB Solar Solution Mine in Carlsbad, New Mexico
- Replacement Extraction Well ("IP30B"): We successfully
completed the IP30B project in June 2024 and the new extraction
well is now serving as our primary source of brine for the current
evaporation season. We expect IP30B will be our primary extraction
well for the Eddy Cavern for future evaporation seasons.
- Phase Two of HB Injection Pipeline Project ("Phase Two"): Phase
Two is the installation of an in-line pigging system to clean the
HB injection pipeline and remove scaling to help ensure more
consistent flow rates. All pipeline is now installed and tanks have
been set, and we expect to commission the project in the third
quarter of 2024.
- Brine Recovery Mine in Wendover, Utah
- Primary Pond 7 ("PP7"): Construction of PP7 is complete and the
new pond is being filled with brine. This new primary pond is
expected to increase the brine evaporative area at Wendover and
help us meet our goals of maximizing brine availability, increasing
brine grade, and improving production. We expect to see the
production benefits of the new primary pond in the fall of
2025.
- Lithium Project: We continue to advance our lithium project in
Wendover and are in the process of reviewing proposals from
multiple partners. The lithium already present in our byproduct
magnesium brine is estimated to support approximately two thousand
tons of lithium carbonate production per year assuming the
existence of a commercially feasible extraction technology.
- Intrepid South
- Sand Project: We have all necessary permits in place to begin
construction and operation on our sand project. While our sand
project shows good potential, owing to softening conditions in the
oilfield services market, we’re pausing development and will be
dedicating our resources to other strategic priorities at this
time.
- East Underground Trio® Mine
- Operational & Cost Efficiencies: Owing to efficiencies from
the two continuous miners placed into service in 2023 and the
operation of our fine langbeinite recovery system, we've seen
significant improvement in our production rates and cost structure
compared to the prior year. For the first six months of 2024, our
cost of goods sold totaled approximately $284 per ton, which
compares to the same prior-year figure of $320 per ton. Improving
our margins in the Trio® segment through operational efficiencies
and cost savings initiatives remains a key focus for Intrepid.
Liquidity
- During the second quarter of 2024, cash flow provided by
operations was $27.7 million, while cash used in investing
activities was $9.8 million. As of July 31, 2024, Intrepid had
approximately $51.1 million in cash and cash equivalents and had no
outstanding borrowings on our $150 million revolving credit
facility.
- Intrepid maintains an investment account of short-and-long-term
fixed income securities that had a balance of approximately $2.5
million as of July 31, 2024.
Consolidated Results, Management Commentary, &
Outlook
In the second quarter of 2024, Intrepid generated sales of $62.1
million, a 23% decrease from second quarter 2023 sales of $81.0
million. Consolidated gross margin totaled $7.6 million, while net
loss totaled $0.8 million, or a net loss of $0.06 per diluted
share, which compares to second quarter 2023 net income of $4.3
million, or $0.33 per diluted share. The Company delivered adjusted
EBITDA(1) of $9.2 million, down from $15.8 million in the same
prior year period, with the lower profitability primarily being
driven by lower pricing for our key products. Our second quarter
2024 average net realized sales prices(1) for potash and Trio®
averaged $405 and $314 per ton, respectively, which compares to
$479 and $333 per ton, respectively, in the second quarter of
2023.
Matt Preston, Intrepid's Chief Financial Officer and acting
principal executive officer commented: "Our strategic focus
continues to be improving our potash production, and I'm happy to
share that we saw the first indications of this in our second
quarter results. Improved brine grades at HB from the Eddy Cavern
and good early-season evaporation rates, allowed us to extend our
spring production season and we still expect our 2024 potash
production to be approximately 15% higher than 2023.
As for our second quarter results, our operational and financial
performance continues to be solid. In Trio®, our sales volumes and
production are well ahead of last year's pace through the first six
months of the year as increased operating rates from our new
continuous miners and our modified operating schedule have driven
significant improvement in both our total and per ton production
costs. Trio® segment gross margin of $2.2 million in the second
quarter was an increase of approximately $3.3 million sequentially
and $1 million year-over-year. As the broader potash market looks
to be finding its midcycle pricing floor, we remain focused on
improving our unit economics by means of higher potash
production.
Lastly, we want to again extend our best wishes to Bob as he
continues his recovery. We will provide updates on our search for a
new CEO as that process unfolds in the coming months."
Segment Highlights
Potash
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
(in thousands, except per ton
data)
Sales
$
30,034
$
47,264
$
67,610
$
99,761
Gross margin
$
3,312
$
12,876
$
8,886
$
27,304
Potash sales volumes (in tons)
55
79
129
167
Potash production volumes (in tons)
40
12
127
102
Average potash net realized sales price
per ton(1)
$
405
$
479
$
399
$
485
Our total sales in the potash segment decreased $17.2 million in
the second quarter of 2024, compared to the second quarter of 2023,
as potash sales decreased $17.0 million, or 41%, and potash segment
byproduct sales decreased $0.3 million. Our potash sales decreased
in the second quarter of 2024, compared to the second quarter of
2023, as our average net realized sales price per ton decreased
15%, and we sold 30% fewer tons. We sold fewer tons of potash in
the second quarter of 2024, compared to the second quarter of 2023,
as we had fewer tons of potash to sell due to lower potash
production from our HB and Wendover facilities.
Our potash segment cost of goods sold decreased by 25% in the
second quarter of 2024, compared to the second quarter of 2023, as
we sold 30% fewer tons of potash, although our production costs
remained elevated due to decreased production volumes over the past
year. A significant portion of our potash production costs are
fixed and an increase in potash tons produced reduces our potash
per ton cost.
During the second quarter of 2024, we recorded lower of cost or
net realizable value inventory adjustments of $1.4 million as our
weighted average carrying cost per ton for inventoried potash
products at our HB and Wendover facilities was higher than our
expected selling price per ton for those products.
Our potash segment gross margin decreased $9.6 million in the
second quarter of 2024, compared to the second quarter of 2023, due
to the factors discussed above.
Trio®
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
(in thousands, except per ton
data)
Sales
$
26,522
$
28,748
$
63,010
$
59,022
Gross margin
$
2,182
$
1,222
$
1,043
$
2,674
Trio® sales volume (in tons)
63
63
154
128
Trio® production volume (in tons)
68
58
122
107
Average Trio® net realized sales price per
ton(1)
$
314
$
333
$
306
$
339
Trio® segment sales decreased 8% during the second quarter of
2024, compared to the second quarter of 2023. Trio® sales decreased
$0.8 million, and our Trio® segment byproduct sales decreased $1.4
million. Trio® sales volumes were flat year-over year, and similar
to potash prices discussed above, our Trio® average net realized
sales price per ton has decreased since the peak prices realized
during the second quarter of 2022, as potassium fertilizer supplies
have improved.
Our Trio® cost of goods sold decreased 18% in the second quarter
of 2024 despite sales volumes matching the prior year quarter, as
improved production rates and decreased total production costs led
to an improvement in our per unit costs. In the second quarter of
2024, we produced 68 thousand tons of Trio® which compares to 58
thousand tons in the same prior-year period. A significant portion
of our production costs are fixed and an increase in tons produced
decreases our per ton production costs.
Our Trio® segment generated gross margin of $2.2 million in the
second quarter of 2024, compared to gross margin of $1.2 million in
the second quarter of 2023, due to the factors discussed above.
Oilfield Solutions
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
(in thousands)
Sales
$
5,539
$
5,111
$
10,862
$
9,361
Gross margin
$
2,130
$
1,284
$
4,129
$
1,756
Our oilfield solutions segment sales increased $0.4 million in
the second quarter of 2024, compared to the second quarter of 2023,
primarily due to a $0.2 million increase in brine water sales and a
$0.3 million increase in other oilfield solution products and
services. Our water sales increased compared to the prior year
period due to increased sales of water on our South ranch. Our
brine water sales and sales of other oilfield solutions segments
products and services increased due to continued strong demand from
oil and gas operators in the Permian Basin near Intrepid South.
Our cost of goods sold decreased $0.4 million, or 11%, in the
second quarter of 2024, compared to the second quarter of 2023, due
to using less contract labor. In the second quarter of 2023, we
used contract labor to complete various projects at Intrepid
South.
Gross margin for the second quarter of 2024 increased $0.8
million compared to the second quarter of 2023, due to the factors
discussed above.
Notes
1 Adjusted net (loss) income, adjusted net (loss) income per
diluted share, adjusted earnings before interest, taxes,
depreciation, and amortization (or adjusted EBITDA) and average net
realized sales price per ton are non-GAAP financial measures. See
the non-GAAP reconciliations set forth later in this press release
for additional information.
Unless expressly stated otherwise or the context otherwise
requires, references to tons in this press release refer to short
tons. One short ton equals 2,000 pounds. One metric tonne, which
many international competitors use, equals 1,000 kilograms or
2,204.62 pounds.
Conference Call Information
Intrepid will host a conference call on Tuesday, August 6, 2024,
at 12:00 p.m. Eastern Time to discuss the results and other
operating and financial matters and answer investor questions.
Management invites you to listen to the conference call by using
the toll-free dial-in number 1 (800) 715-9871 or International
dial-in number 1 (646) 307-1963; please use conference ID 1179359.
The call will also be streamed on the Intrepid website,
intrepidpotash.com. A recording of the conference call will be
available approximately two hours after the completion of the call
by dialing 1 (800) 770-2030 for toll-free, 1 (609) 800-9909 for
International, or at intrepidpotash.com. The replay of the call
will require the input of the replay access code 1179359. The
recording will be available through August 13, 2024.
About Intrepid
Intrepid is a diversified mineral company that delivers
potassium, magnesium, sulfur, salt, and water products essential
for customer success in agriculture, animal feed, and the oil and
gas industry. Intrepid is the only U.S. producer of muriate of
potash, which is applied as an essential nutrient for healthy crop
development, utilized in several industrial applications, and used
as an ingredient in animal feed. In addition, Intrepid produces a
specialty fertilizer, Trio®, which delivers three key nutrients,
potassium, magnesium, and sulfate, in a single particle. Intrepid
also provides water, magnesium chloride, brine, and various
oilfield products and services. Intrepid serves diverse customers
in markets where a logistical advantage exists and is a leader in
the use of solar evaporation for potash production, resulting in
lower cost and more environmentally friendly production. Intrepid's
mineral production comes from three solar solution potash
facilities and one conventional underground Trio® mine.
Intrepid routinely posts important information, including
information about upcoming investor presentations and press
releases, on its website under the Investor Relations tab.
Investors and other interested parties are encouraged to enroll at
intrepidpotash.com, to receive automatic email alerts for new
postings.
Forward-looking Statements
This document contains forward-looking statements - that is,
statements about future, not past, events. The forward-looking
statements in this document relate to, among other things,
statements about Intrepid's future financial performance, cash flow
from operations expectations, water sales, production costs,
acquisition expectations and operating plans, its market outlook,
and statements regarding management matters. These statements are
based on assumptions that Intrepid believes are reasonable.
Forward-looking statements by their nature address matters that are
uncertain. The particular uncertainties that could cause Intrepid's
actual results to be materially different from its forward-looking
statements include the following:
- changes in the price, demand, or supply of our products and
services;
- challenges and legal proceedings related to our water
rights;
- our ability to successfully identify and implement any
opportunities to grow our business whether through expanded sales
of water, Trio®, byproducts, and other non-potassium related
products or other revenue diversification activities;
- the costs of, and our ability to successfully execute, any
strategic projects;
- declines or changes in agricultural production or fertilizer
application rates;
- declines in the use of potassium-related products or water by
oil and gas companies in their drilling operations;
- our ability to prevail in outstanding legal proceedings against
us;
- our ability to comply with the terms of our revolving credit
facility, including the underlying covenants;
- further write-downs of the carrying value of assets, including
inventories;
- circumstances that disrupt or limit production, including
operational difficulties or variances, geological or geotechnical
variances, equipment failures, environmental hazards, and other
unexpected events or problems;
- changes in reserve estimates;
- currency fluctuations;
- adverse changes in economic conditions or credit markets;
- the impact of governmental regulations, including environmental
and mining regulations, the enforcement of those regulations, and
governmental policy changes;
- adverse weather events, including events affecting
precipitation and evaporation rates at our solar solution
mines;
- increased labor costs or difficulties in hiring and retaining
qualified employees and contractors, including workers with mining,
mineral processing, or construction expertise;
- changes in management and the board of directors, and our
reliance on key personnel, including our ability to identify,
recruit, and retain key personnel;
- changes in the prices of raw materials, including chemicals,
natural gas, and power;
- our ability to obtain and maintain any necessary governmental
permits or leases relating to current or future operations;
- interruptions in rail or truck transportation services, or
fluctuations in the costs of these services;
- our inability to fund necessary capital investments;
- global inflationary pressures and supply chain challenges;
- the impact of global health issues, and other global
disruptions on our business, operations, liquidity, financial
condition and results of operations; and
- the other risks, uncertainties, and assumptions described in
Item 1A. Risk Factors of our Annual Report on Form 10-K for the
year ended December 31, 2023, and our other reports we file with
the Securities and Exchange Commission.
In addition, new risks emerge from time to time. It is not
possible for Intrepid to predict all risks that may cause actual
results to differ materially from those contained in any
forward-looking statements Intrepid may make. All information in
this document speaks as of the date of this release. New
information or events after that date may cause our forward-looking
statements in this document to change. We undertake no obligation
to update or revise publicly any forward-looking statements to
conform the statements to actual results or to reflect new
information or future events.
INTREPID POTASH, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE AND SIX MONTHS
ENDED JUNE 30, 2024 AND 2023
(In thousands, except per
share amounts)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Sales
$
62,055
$
81,035
$
141,342
$
167,955
Less:
Freight costs
9,423
10,516
22,253
22,106
Warehousing and handling costs
2,586
2,801
5,675
5,534
Cost of goods sold
41,070
52,336
97,501
108,581
Lower of cost or net realizable value
inventory adjustments
1,352
—
1,855
—
Gross Margin
7,624
15,382
14,058
31,734
Selling and administrative
7,937
7,948
16,294
16,806
Accretion of asset retirement
obligation
622
535
1,244
1,070
Impairment of long-lived assets
831
—
2,208
—
Loss (gain) on sale of assets
241
(7
)
492
193
Other operating income
(1,266
)
(439
)
(2,659
)
(730
)
Other operating expense
887
77
2,413
1,753
Operating (Loss) Income
(1,628
)
7,268
(5,934
)
12,642
Other Income
Equity in (loss) earnings of
unconsolidated entities
(116
)
(1,059
)
33
(238
)
Interest income
547
76
791
161
Other income
60
43
68
56
(Loss) Income Before Income
Taxes
(1,137
)
6,328
(5,042
)
12,621
Income Tax Benefit (Expense)
304
(2,023
)
1,079
(3,810
)
Net (Loss) Income
$
(833
)
$
4,305
$
(3,963
)
$
8,811
Weighted Average Shares Outstanding:
Basic
12,886
12,766
12,852
12,730
Diluted
12,886
12,855
12,852
12,865
(Loss) Earnings Per Share:
Basic
$
(0.06
)
$
0.34
$
(0.31
)
$
0.69
Diluted
$
(0.06
)
$
0.33
$
(0.31
)
$
0.68
INTREPID POTASH, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS (UNAUDITED)
AS OF JUNE 30, 2024 AND
DECEMBER 31, 2023
(In thousands, except share
and per share amounts)
June 30,
December 31,
2024
2023
ASSETS
Cash and cash equivalents
$
51,663
$
4,071
Short-term investments
2,464
2,970
Accounts receivable:
Trade, net
21,617
22,077
Other receivables, net
1,679
1,470
Inventory, net
101,932
114,252
Prepaid expenses and other current
assets
3,832
7,200
Total current assets
183,187
152,040
Property, plant, equipment, and mineral
properties, net
354,294
358,249
Water rights
19,184
19,184
Long-term parts inventory, net
30,899
30,231
Long-term investments
5,090
6,627
Other assets, net
9,000
8,016
Non-current deferred tax asset, net
195,337
194,223
Total Assets
$
796,991
$
768,570
LIABILITIES AND STOCKHOLDERS'
EQUITY
Accounts payable
$
7,173
$
12,848
Accrued liabilities
11,310
14,061
Accrued employee compensation and
benefits
6,856
7,254
Other current liabilities
8,100
12,401
Total current liabilities
33,439
46,564
Advances on credit facility
—
4,000
Asset retirement obligation, net of
current portion
31,321
30,077
Operating lease liabilities
345
741
Finance lease liabilities
1,428
1,451
Deferred other income, long-term
46,617
—
Other non-current liabilities
1,593
1,309
Total Liabilities
114,743
84,142
Commitments and Contingencies
Common stock, $0.001 par value; 40,000,000
shares authorized;
12,908,078 and 12,807,316 shares
outstanding
at June 30, 2024, and December 31, 2023,
respectively
14
13
Additional paid-in capital
667,419
665,637
Retained earnings
36,827
40,790
Less treasury stock, at cost
(22,012
)
(22,012
)
Total Stockholders' Equity
682,248
684,428
Total Liabilities and Stockholders'
Equity
$
796,991
$
768,570
INTREPID POTASH, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE AND SIX MONTHS
ENDED JUNE 30, 2024 AND 2023
(In thousands)
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Cash Flows from Operating
Activities:
Net (loss) income
$
(833
)
$
4,305
$
(3,963
)
$
8,811
Adjustments to reconcile net (loss) income
to net cash provided by operating activities:
Depreciation, depletion and
amortization
8,594
8,892
17,898
18,183
Accretion of asset retirement
obligation
622
535
1,244
1,070
Amortization of deferred financing
costs
76
75
151
151
Amortization of intangible assets
84
80
164
161
Stock-based compensation
1,235
1,803
2,557
3,549
Lower of cost or net realizable value
inventory adjustments
1,352
—
1,855
—
Impairment of long-lived assets
831
—
2,208
—
Loss (gain) on disposal of assets
241
(7
)
492
193
Allowance for parts inventory
obsolescence
419
—
472
—
Equity in loss (earnings) of
unconsolidated entities
116
1,059
(33
)
238
Distribution of earnings from
unconsolidated entities
—
132
—
452
Changes in operating assets and
liabilities:
Trade accounts receivable, net
20,208
15,391
459
2,917
Other receivables, net
(497
)
(867
)
(250
)
(959
)
Inventory, net
(1,509
)
3,117
9,326
10,763
Prepaid expenses and other current
assets
1,353
656
2,275
906
Deferred tax assets, net
(325
)
2,016
(1,114
)
3,676
Accounts payable, accrued liabilities, and
accrued employee compensation and benefits
(3,271
)
(2,827
)
(6,892
)
(8,132
)
Operating lease liabilities
(356
)
(408
)
(740
)
(809
)
Deferred other income
(562
)
—
43,872
—
Other liabilities
(32
)
(3,455
)
(703
)
(2,222
)
Net cash provided by operating
activities
27,746
30,497
69,278
38,948
Cash Flows from Investing
Activities:
Additions to property, plant, equipment,
mineral properties and other assets
(11,301
)
(20,895
)
(22,974
)
(41,934
)
Purchase of investments
—
(459
)
—
(1,415
)
Proceeds from sale of assets
55
24
4,651
89
Proceeds from redemptions/maturities of
investments
1,000
2,500
1,500
4,000
Other investing, net
416
508
416
508
Net cash used in investing activities
(9,830
)
(18,322
)
(16,407
)
(38,752
)
Cash Flows from Financing
Activities:
Payments of financing lease
(176
)
(167
)
(500
)
(210
)
Proceeds from short-term borrowings on
credit facility
—
—
—
5,000
Repayments of short-term borrowings on
credit facility
—
(5,000
)
(4,000
)
(5,000
)
Employee tax withholding paid for
restricted stock upon vesting
(142
)
(298
)
(775
)
(1,337
)
Net cash used in financing activities
(318
)
(5,465
)
(5,275
)
(1,547
)
Net Change in Cash, Cash Equivalents
and Restricted Cash
17,598
6,710
47,596
(1,351
)
Cash, Cash Equivalents and Restricted
Cash, beginning of period
34,649
11,023
4,651
19,084
Cash, Cash Equivalents and Restricted
Cash, end of period
$
52,247
$
17,733
$
52,247
$
17,733
INTREPID POTASH, INC. UNAUDITED
NON-GAAP RECONCILIATIONS FOR THE THREE AND SIX MONTHS ENDED
JUNE 30, 2024 AND 2023 (In thousands)
To supplement Intrepid's consolidated financial statements,
which are prepared and presented in accordance with GAAP, Intrepid
uses several non-GAAP financial measures to monitor and evaluate
its performance. These non-GAAP financial measures include adjusted
net (loss) income, adjusted net (loss) income per diluted share,
adjusted EBITDA, and average net realized sales price per ton.
These non-GAAP financial measures should not be considered in
isolation, or as a substitute for, or superior to, the financial
information prepared and presented in accordance with GAAP. In
addition, because the presentation of these non-GAAP financial
measures varies among companies, these non-GAAP financial measures
may not be comparable to similarly titled measures used by other
companies.
Intrepid believes these non-GAAP financial measures provide
useful information to investors for analysis of its business.
Intrepid uses these non-GAAP financial measures as one of its tools
in comparing period-over-period performance on a consistent basis
and when planning, forecasting, and analyzing future periods.
Intrepid believes these non-GAAP financial measures are used by
professional research analysts and others in the valuation,
comparison, and investment recommendations of companies in the
potash mining industry. Many investors use the published research
reports of these professional research analysts and others in
making investment decisions.
Adjusted Net (Loss) Income and Adjusted Net (Loss) Income Per
Diluted Share
Adjusted net (loss) income and adjusted net (loss) income per
diluted share are calculated as net (loss) income or net (loss)
income per diluted share adjusted for certain items that impact the
comparability of results from period to period, as set forth in the
reconciliation below. Intrepid considers these non-GAAP financial
measures to be useful because they allow for period-to-period
comparisons of its operating results excluding items that Intrepid
believes are not indicative of its fundamental ongoing
operations.
Reconciliation of Net (Loss) Income to Adjusted Net (Loss)
Income:
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
(in thousands)
Net (Loss) Income
$
(833
)
$
4,305
$
(3,963
)
$
8,811
Adjustments
Impairment of long-lived assets
831
—
2,208
—
Loss (gain) on sale of assets
241
(7
)
492
193
Calculated income tax effect(1)
(279
)
2
(702
)
(50
)
Total adjustments
793
(5
)
1,998
143
Adjusted Net (Loss) Income
$
(40
)
$
4,300
$
(1,965
)
$
8,954
Reconciliation of Net (Loss) Income per Share to Adjusted Net
(Loss) Income per Share:
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
Net (Loss) Income Per Diluted Share
$
(0.06
)
$
0.33
$
(0.31
)
$
0.68
Adjustments
Impairment of long-lived assets
0.06
—
0.17
—
Loss on sale of assets
0.02
—
0.04
0.02
Calculated income tax effect(1)
(0.02
)
—
(0.05
)
—
Total adjustments
0.06
—
0.16
0.02
Adjusted Net (Loss) Income Per Diluted
Share
$
—
$
0.33
$
(0.15
)
$
0.70
(1) Assumes an annual effective tax rate of 26% for 2024
and 2023.
Adjusted EBITDA
Adjusted earnings before interest, taxes, depreciation, and
amortization (or adjusted EBITDA) is calculated as net (loss)
income adjusted for certain items that impact the comparability of
results from period to period, as set forth in the reconciliation
below. Intrepid considers adjusted EBITDA to be useful, and believe
it to be useful for investors, because the measure reflects
Intrepid's operating performance before the effects of certain
non-cash items and other items that Intrepid believes are not
indicative of its core operations. Intrepid uses adjusted EBITDA to
assess operating performance.
Reconciliation of Net (Loss) Income to Adjusted EBITDA:
Three Months Ended June
30,
Six Months Ended June
30,
2024
2023
2024
2023
(in thousands)
Net (Loss) Income
$
(833
)
$
4,305
$
(3,963
)
$
8,811
Impairment of long-lived assets
831
—
2,208
—
Loss (gain) on sale of assets
241
(7
)
492
193
Interest expense
—
—
—
—
Income tax (benefit) expense
(304
)
2,023
(1,079
)
3,810
Depreciation, depletion, and
amortization
8,594
8,892
17,898
18,183
Amortization of intangible assets
84
80
164
161
Accretion of asset retirement
obligation
622
535
1,244
1,070
Total adjustments
10,068
11,523
20,927
23,417
Adjusted EBITDA
$
9,235
$
15,828
$
16,964
$
32,228
Average Potash and Trio® Net Realized Sales Price per
Ton
Average net realized sales price per ton for potash is
calculated as potash segment sales less potash segment byproduct
sales and potash freight costs and then dividing that difference by
the number of tons of potash sold in the period. Likewise, average
net realized sales price per ton for Trio® is calculated as Trio®
segment sales less Trio® segment byproduct sales and Trio® freight
costs and then dividing that difference by Trio® tons sold.
Intrepid considers average net realized sales price per ton to be
useful, and believe it to be useful for investors, because it shows
Intrepid's potash and Trio® average per ton pricing without the
effect of certain transportation and delivery costs. When Intrepid
arranges transportation and delivery for a customer, it includes in
revenue and in freight costs the costs associated with
transportation and delivery. However, some of Intrepid's customers
arrange for and pay their own transportation and delivery costs, in
which case these costs are not included in Intrepid's revenue and
freight costs. Intrepid uses average net realized sales price per
ton as a key performance indicator to analyze potash and Trio®
sales and price trends.
Reconciliation of Sales to Average Net Realized Sales Price per
Ton:
Three Months Ended June
30,
2024
2023
(in thousands, except per ton amounts)
Potash
Trio®
Potash
Trio®
Total Segment Sales
$
30,034
$
26,522
$
47,264
$
28,748
Less: Segment byproduct sales
5,896
109
6,158
1,520
Freight costs
1,871
6,660
3,272
6,266
Subtotal
$
22,267
$
19,753
$
37,834
$
20,962
Divided by:
Tons sold
55
63
79
63
Average net realized sales price per
ton
$
405
$
314
$
479
$
333
Six Months Ended June
30,
2024
2023
(in thousands, except per ton amounts)
Potash
Trio®
Potash
Trio®
Total Segment Sales
$
67,610
$
63,010
$
99,761
$
59,022
Less: Segment byproduct sales
11,060
313
11,500
2,740
Freight costs
5,017
15,634
7,264
12,952
Subtotal
$
51,533
$
47,063
$
80,997
$
43,330
Divided by:
Tons sold
129
154
167
128
Average net realized sales price per
ton
$
399
$
306
$
485
$
339
Three Months Ended June 30,
2024
Product
Potash Segment
Trio® Segment
Oilfield Solutions
Segment
Intersegment
Eliminations
Total
Potash
$
24,138
$
—
$
—
$
(40
)
$
24,098
Trio®
—
26,413
—
—
26,413
Water
—
—
2,572
—
2,572
Salt
3,335
109
—
—
3,444
Magnesium Chloride
932
—
—
—
932
Brine Water
1,584
—
1,166
—
2,750
Other
45
—
1,801
—
1,846
Total Revenue
$
30,034
$
26,522
$
5,539
$
(40
)
$
62,055
Six Months Ended June 30,
2024
Product
Potash Segment
Trio® Segment
Oilfield Solutions
Segment
Intersegment
Eliminations
Total
Potash
$
56,550
$
—
$
—
$
(140
)
$
56,410
Trio®
—
62,697
—
—
62,697
Water
—
—
4,741
—
4,741
Salt
6,479
313
—
—
6,792
Magnesium Chloride
1,351
—
—
—
1,351
Brine Water
3,167
—
2,293
—
5,460
Other
63
—
3,828
—
3,891
Total Revenue
$
67,610
$
63,010
$
10,862
$
(140
)
$
141,342
Three Months Ended June 30,
2023
Product
Potash Segment
Trio® Segment
Oilfield Solutions
Segment
Intersegment
Eliminations
Total
Potash
$
41,106
$
—
$
—
$
(88
)
$
41,018
Trio®
—
27,228
—
—
27,228
Water
100
1,474
2,568
—
4,142
Salt
3,278
46
—
—
3,324
Magnesium Chloride
1,667
—
—
—
1,667
Brine Water
1,113
—
1,001
—
2,114
Other
—
—
1,542
—
1,542
Total Revenue
$
47,264
$
28,748
$
5,111
$
(88
)
$
81,035
Six Months Ended June 30,
2023
Product
Potash Segment
Trio® Segment
Oilfield Solutions
Segment
Intersegment
Eliminations
Total
Potash
$
88,261
$
—
$
—
$
(189
)
$
88,072
Trio®
—
56,282
—
—
56,282
Water
180
2,522
4,187
—
6,889
Salt
6,321
218
—
—
6,539
Magnesium Chloride
2,804
—
—
—
2,804
Brine Water
2,195
—
1,823
—
4,018
Other
—
—
3,351
—
3,351
Total Revenue
$
99,761
$
59,022
$
9,361
$
(189
)
$
167,955
Three Months Ended
June 30, 2024
Potash
Trio®
Oilfield Solutions
Other
Consolidated
Sales
$
30,034
$
26,522
$
5,539
$
(40
)
$
62,055
Less: Freight costs
2,803
6,660
—
(40
)
9,423
Warehousing and handling
costs
1,343
1,243
—
—
2,586
Cost of goods sold
21,224
16,437
3,409
—
41,070
Lower of cost or net
realizable value inventory
adjustments
1,352
—
—
—
1,352
Gross Margin
$
3,312
$
2,182
$
2,130
$
—
$
7,624
Depreciation, depletion, and amortization
incurred1
$
6,178
$
851
$
1,195
$
454
$
8,678
Six Months Ended June 30, 2024
Potash
Trio®
Oilfield Solution
Other
Consolidated
Sales
$
67,610
$
63,010
$
10,862
$
(140
)
$
141,342
Less: Freight costs
6,759
15,634
—
(140
)
22,253
Warehousing and handling
costs
3,070
2,605
—
—
5,675
Cost of goods sold
47,040
43,728
6,733
—
97,501
Lower of cost or net
realizable value inventory
adjustments
1,855
—
—
—
1,855
Gross Margin
$
8,886
$
1,043
$
4,129
$
—
$
14,058
Depreciation, depletion, and amortization
incurred1
$
13,149
$
1,735
$
2,266
$
912
$
18,062
Three Months Ended
June 30, 2023
Potash
Trio®
Oilfield Solution
Other
Consolidated
Sales
$
47,264
$
28,748
$
5,111
$
(88
)
$
81,035
Less: Freight costs
4,338
6,266
—
(88
)
10,516
Warehousing and handling
costs
1,609
1,192
—
—
2,801
Cost of goods sold
28,441
20,068
3,827
—
52,336
Gross Margin
$
12,876
$
1,222
$
1,284
$
—
$
15,382
Depreciation, depletion, and amortization
incurred1
$
6,429
$
1,405
$
915
$
223
$
8,972
Six Months Ended June 30, 2023
Potash
Trio®
Oilfield Solution
Other
Consolidated
Sales
$
99,761
$
59,022
$
9,361
$
(189
)
$
167,955
Less: Freight costs
9,343
12,952
—
(189
)
22,106
Warehousing and handling
costs
3,089
2,445
—
—
5,534
Cost of goods sold
60,025
40,951
7,605
—
108,581
Gross Margin
$
27,304
$
2,674
$
1,756
$
—
$
31,734
Depreciation, depletion and amortization
incurred1
$
13,482
$
2,611
$
1,822
$
429
$
18,344
(1) Depreciation, depletion, and amortization incurred for
potash and Trio® excludes depreciation, depletion, and amortization
amounts absorbed in or relieved from inventory.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240805586709/en/
Evan Mapes, CFA, Investor Relations Manager Phone: 303-996-3042
Email: evan.mapes@intrepidpotash.com
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