Compass Minerals International (CMP)

Theresa Womble Director of Investor Relations
Kevin Crutchfield Chief Executive Officer
Jamie Standen Chief Financial Officer
Brad Griffith Chief Commercial Officer
George Schuller Chief Operating Officer
Vincent Anderson Stifel
Mark Connelly Stephens
Joel Jackson BMO Capital Markets
David Silver CL King
Chris Shaw Monness, Crespi
Call transcript
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Good day, and welcome to the Compass Minerals' First Quarter Earnings Conference. Today's conference is being recorded. At this time, I would like to turn the conference over to Theresa Womble. Please go ahead.

Theresa Womble

Good morning everyone.

to and this unprecedented glad during with very challenging these times. are be call hosting you We

On Q&A the for bear so call Officer; George Crutchfield; we are and Schuller. today, as Griffith, through as we session. have CFO, Brad during us Chief organize Standen. any our well Jamie Several as pauses Also Operating Chief of please joining our the our session our Q&A the Commercial CEO, Officer, Kevin remote are

me remind today risks let X, at our in that We the of Before financial the make started, located we expectations filings outlook and SEC May everyone remarks we could materially. cause discuss today's company's represent our these involve Relations get that XXXX. Investor online compassminerals.com. These date view actual risks our uncertainties differ as results and operational of to

today Our and cash flow. also financial adjusted as non-GAAP EBITDA remarks measures free include such

find our reconciliations these can that our both to I website. in of also on housekeeping items are now presentation out With call the which our earnings You Kevin. over the available way, release or of turn earnings of

Kevin Crutchfield

Thanks, Theresa, and everyone. good morning,

Theresa times of as by for address indeed are us posed mentioned, the the all challenges pandemic. these we current As unprecedented

have and customer responders our period environment. and uncertain the working get us who started, service delivery extend health who care continuity keeping lines on going others thank to on first front to to from on the change. we team Before are during products, of to COVID-XX we Compass also business company, entire produce essential and and needs behalf many leadership pandemic continued uncertainty this I'd you in personnel food service at employees the And of those of behalf and our like professionals the of our Minerals, here a maintain thank an heartfelt

governmental such our we as business animal while products support pharmaceutical food, to potential view scenario impacts and to I from transportation, we've and our and spread provide safety employees current and producing industries want current and for how to current planning essential to responded minutes be results. we on then will just few COVID-XX, performance by financial insight remarks. detail prepared the our our the George quarter delivering also adhere the will agriculture, undertaken a before and Minerals nutrition liquidity pandemic posed Compass on prevent after to move we'll where we outlook. and safeguard that share beyond Brad follow-up the we've recommendations challenges and of an rigorous protocols the to vital critical greater as of chemical As But and more think our the at sharing detail available all into spend have first continued COVID-XX. Jamie seeking summarizing additional crisis, the these exposure questions be

performance older XXXX hard our safeguarding and safety these one for them cash our from compared and as X,XXX-plus mode executed Since quarter outages maintenance crisis in thank continued mines Production priority from performance. back-office in has now Behind business. even again was very XX% while to at health on strong to and areas: achieved management, million. this $XXX operations management our full quarter our commissioning first number earnings we from North efforts the uncertain than deeply the rates on improvements healthy March our expectations; sales challenges have leave peaking unit. our business this almost XX% the in no employees XX% increased things, XX% increased upside's is operations two, we've improvements and Goderich, First four incredible four exactly rose systems continue stone improvement through our EBITDA to three, to were results, are business despite operating at cash and times results focus has emerged, at which show This our XXXX dedication earnings analysis. results to From employees production of to worked flow to level other improvement of experienced of North more and our logistics in a customer despite planning segments. volume of salt Nutrition lower through times and our who pricing these execution on the both business salt mild miner drove America three cutting rate Plant delivering testing to and delivering I in focused by fulfilling and continuous and enhance deicing been the liquidity; scenario have the procurement demand areas at businesses XX% their for senior remained sales the a all included essential positive growth of planned. Among marketing, employees; well responsibilities as strong as EBITDA absolutely pressure number and winter efforts. our to an engage all our American rigorous unturned up that team due and sharpen our the effort as and Strong as salt And U.K. in of maintaining operating adaptability in our driving

our working as our a of undertaken priority the actions frankly priority And employees. this the so. first to and of ensure pandemic challenges to we safety number of first times we've Our all health do at faced is

roles had social significant operating temporary a air our implemented we and outside headquarters North international; certain operation both Brazil support to business on around placed in America at and good sanitation loading for safety related ongoing provided shift to sizes from visitation we've reductions support as our and offices; and I'm Specifically, program. at mental not policy temporarily lay impacts. heightened of across assistance offices home our COVID-XX organization-wide; result professional crew all enacted support common travel increased sites; to hygiene sites continued our areas staggered and emphasis practices; employees to facilities due have implemented restricted ceased health work a times restrictions of confidential platform domestic products, wage enable the at any our to company site; report both for that employee operating through our contractor on sites unloading enact essential within off and on the operational or distancing; thankful our protocols need commercial increased

in In us. idle. while addition, manner continue U.K. our focus to mine employees there demand is products is also receiving timely and pay for customers' Ensuring their our efficient full essential top our for a a our we serve are

set produce array an mineral essential that products a has for critical privileged of of company industries. assets Our

salt helps rock wintry a Our for critical industrial is on roadways keep people and chemical and safe input products.

food ultimately water In care these commercial plant our nutrition. crops food for nutrients used total, is salt evaporated healthy specialty and support the growth security. And of mechanically and production, animal and Our demand of maintained and meet North relatively healthy products consistent at facilities our America has production crisis. the levels remain essential and them To demand, we all during Brazil. for been in have this continued yield

plans serve unexpected workforce, to to as prepare material today, I work disruption our We material contingency continue customers. can production experienced any not of continuity distribution we've our ability customer’s, and plans our with review for report for of in any production logistics suppliers the prevent forecasts disruptions to to our our or networks. all develop partners and and and proactively sites, update business or

inputs been precisely essential confident not rely do end the still we the certain short-term, and pandemic for will Compass we own and that will This have markets While and has customers are over long these the on impact be products continue on this services. expect an our of medium know resilience important in Minerals. attribute to may that we long-term their

in a refund intense I'm a focus management from the combination very flow report first the from quarter. working resulted of operations to in now on tax an IRS to Turning $XXX.X liquidity. of cash capital that pleased and million

about continue a quarter liquidity in that The been liquidity from and million to variety resilience you I identify priority supply end business. of the navigate also planning stress cash necessary. detail risks become our I tested to what will about and We'll to results, to roughly these ensure has all management our more levers discuss those hear more so, be can to hand of financial will of in to deploy specifics to that of and this We agility and been you to laser on though we see a our last focus operations, tell on these have team uncertainty We're and ended scenarios area of unique in period compared focus at mean the and circumstances. to for and the $XX that $XXX have of want on and pressure for we perspective XXXX. our we've business. pull chains markets To Jamie just the million what various potential the should we do but from for of some our to capital in today, variety comfortably outlook. analysis. currently confident a from keep risk this continue a would we cash how Jamie well-positioned with shortly financial preparedness

COVID-related performance taken in of far it year. we've will and we've through conducting, look XXXX our rest overall a been at the the also pressure testing business thus In seasonal impact addition demand to how the hard

modestly to to tighten conservatism, our with reflect better our and result current prudent it EBITDA a guidance As an decided lowered eye expectations. and toward we

to I'd and Now, environment. key as in priorities on we stated February the these for light we strategic what priorities of update XXXX to current you return like see in our where

Plant First, I'd strategic America our business. of like South discuss Nutrition to in our review

and capital been the We to impacts and this caused the interest have best our generated value. by business that strong for the in XXXX. that process due increased of performance pandemic. performance assets its belief value we'd determined remain is very of one markets, steadfast to the This consider an our planning the our time transaction it's sufficiently to global that recognizes unexpected this with in we for logistics pleased inherent This the team in the these excellent and it that uncertainty also in we've travel shareholders the only reinforces business thus and suspend and has of being is position management asset far

improvements we our our delivering to and business. enterprise-wide to we financial the efforts implement optimization continued Turning commitments them I be by benefits We're to and tangible to identify the inspired do year. our on to some impressed as and just of way expect through from have see build effort, both progress and the dedication people these beginning to

environment, While on original a by plan. track our current the for part with initiatives been small number most have the of partially the we delayed remain

last compaction from at the volumes beginning For incremental project the half see to of expect the been quarter Goderich year. in lower we we mentioned project and has example, cost initiated this second

to rest of expect growth the improvements we a time, over build from company range enhancement. commercial and our forms through our safety other we'll we and effort optimization customers to year, top of employees, things logistics on the and demonstrate responsibilities essential to production line look to maintaining as as our can our discipline to and sites to and of the benefits lower continue of the In the As across costs production business. control; meantime in our well-being of protecting focus an our margin we those fulfilling communities our channels

Before me conclude of a Jamie, couple let turning to final with thoughts.

resulted made of believe further economic is business assets. resilience crisis mining we have strong products set efforts operations our Nutrition the well, the essential of of as be cycles. our portfolio in combined and and grounded in on strength considerable the and of our with a engagement underway variety has is we've that inherent in mineral manufacture we're innovation employees. a from built of many our our nature during and a improvements essential the The optimization from active through assets of production products this stability Our and the that'll experiencing Plant product case advantages I unique and in of the the belief

demonstrate confident coming of to as business's its storm we to resiliency. I continue and the in remain ability So the to the course over short-term months, adapt weather our challenges any to continue

Jamie and assessments the risk greater outlook our for crisis. liquidity, COVID-XX Now results, and we'll details hear from financial on Jamie? regarding

Jamie Standen

a within light before Thanks, bolstered will our outlook. start quarter to all I'll take lower COVID-XX X% our year increase and going potential liquidity detail sales positions. pandemic we revenue operating results South year-over-year sales have Kevin on and our consolidated in I leverage our results. in and segments. growth and minutes first on than highlight offset our earnings and good on morning, increases the North segment by first X businesses year-over-year into results with Consolidated Strong America risks volume EBITDA slide the quarter as XXXX some well also more Plant were a business of in greater everyone. to in current Salt as few some generated comments modeled our three operating XXXX and Nutrition prior compared consolidated across of

Excluding increase we our XXXX versus XX% generated in cash from the refund, results. operations a $XX million IRS first flow quarter

Our free with than cash delivered approximately result flow our improved prior We million, details for entire the more the of combination a capital we the excluding through $XXX discuss quarter. our cash earnings. I'll IRS quarter XX% this operating in achieved position along enterprise is and free was flow improvements refund year first later. which the across working liquidity of

quarter first mild the Salt results. earnings winter quarter, from a sales versus operating first XXXX our offset in volumes drop results. and increase results. a for these in resulted quarter X% increase in declines, Despite both margins to average X and X% weather our still and EBITDA quarter than which XX% achieved first Salt and unit point and an U.K. in XXXX in The a in compared revenues growth slide decline segment first drove earnings basis the selling XXXX prices, North Mild winter EBITDA segment during in to to conditions XXX the increase very throughout costs improvements in the results. Moving X% XXXX X% operating compared per higher more a America

the contributing significant impact our $X in a Salt decline resulted cost quarter per cost. to to rates Some the production negative about in year-over-year unit U.K., of this which increase factors include per in the in ton the total

we our demand. for mine We winter in and lower as extended U.K. order continue expectations rates shutdown operating with an updated to levels XXXX expect our during match our took to at fall inventory

during Goderich shutdown. continuous We mine also completed our equipment planned of typical our the haulage refurbishment some March at

for ready Our oldest of four scheduled about and have trains flexible years these conveyor were in some been maintenance. service for

these certain improve $X in negative components, the ton we The going upgraded and impact about quarter. Salt to to performance forward. contributed total During rebuilds, is replacement per replaced these of expected reliability which and of cost components

to production conditions, unit Under those elevated the salt in cost level accounting subsequent the production. rules. we somewhat segment second quarter quarter forward, during expect lower cost Salt to until Looking lower due per is production the This we winter. U.K. into second mainly to costs the remain fixed due inventory certain sell the pulling normal we

North benefits of we costs or However to several selling be will of XXXX costs will XXXX American lower for second to as shortfalls we of enterprise-wide at The above compared in continue selling Rock during sourced reduce to move year into see and be Salt our quickly in the our expected no and mines at second, time salt our sustained plan begin early to these improve half fill was prior first, realization that production production we we XXXX, how efficiency we that tons. period; production our a come expect longer demand reasons: some salt well. rates to supplement on cost upon as efforts and basis; are finally, improve optimization purchased dependent

comes cash XXXX after in XXXX decline XX%. In year-over-year is results. Goderich unit expected fact, into which XX% tons production about in per delivering, to mine plan of This are inventory unit the reduce by at our XXXX day each cost costs a all at versus going

slide X. to Turning

off resulted results. up Our from Lower improved sales last first application year. start soil volumes. wet cold North This sales year's quarter quarter XX% quarter many growers in year nutrients last mining spring with depressed America rates from resulted and volumes a segment tremendous Plant in XXXX the throughout Nutrition much first is for to first delivered when weather results the

from with are geographic mix the seeing the a prior changes declined of on basis nature selling some due catch-up our sales prices year-over-year, year-to-date consistent for to year. SOP. We is Average essential X% segment which mainly

unit for XXXX lower quarter with year to year, to Per due selling prior costs unit basis into compared U.S. results. prior were while EBITDA flat year. a XX% were increased logistics key per in more the from the First Western markets on essentially costs segment tons prior

also volumes economics turning Brazil on the very product XX%. XX% year We've and affordability slide improvements solutions Now XXXX from for XX. first South agriculture strong to America with had up to and up for chemical quarter much XXXX crop Plant in farmers. Nutrition, volumes stronger start fertilizer a sales The drivers include levels sales these

which a barter affordability had year. for deliver rate barter XX, Today a fewer Brazilian ton means XX-kilogram about fertilizer. for has In nutrients has one other that XX:X, ago, soybeans about is grower third bags to beans around XX:X. a example, rates was trade of last means on year-over-year than a For significantly of This for to year beans the basis. grower crop sitting improved words, at

drove benefited Our sales these currency, into as the and many in quarter the local in these products increasing uptick water continued other trends XX XXXX. chlor-alkali go a EBITDA product year-over-year as first BRL an well quarter disinfectants. also for improvement cleaning improved of XXXX of from as significantly for derivatives growth Chemical Solutions demand in million revenue. segment treatment to In first million XX% XX.X from BRL

production improvement, to lower addition volume also costs to unit lower year-over-year the In levels spending. we higher saw strong and due

This can quarter second for light XXXX Our seasonally segment. on the a Slide be quarter for XX. outlook found our is salt segments

increases this average increased revenue largely see prices. in to segment, in expect by selling We driven

North and so decline $X of unit year ton significant In similar that per second mentioned outlook we our of for second with expect season prior U.K. the quarter volumes expectations this per XXXX. to pressures Nutrition April, to lower due levels. sales half Therefore not business quarter sales the more to expected the in compared segment, costs as drive pull materially, I the we the quarter can EBITDA second an We XXXX likely half expect consistent be second than first first we revenue salt into year our is and sales be our the strong concentrated first EBITDA cost still are March However, was prior have to Plant quarter second the changed to similar in overall. quarter. earlier. In early are estimate volume and XXXX America cash to by to costs believe to half

expecting sales as South ramping Our remain economics to product crop segment up Nutrition Plant America agriculture continue is positive.

to We in grower our to sales increased see volumes are business-to-business continue see performance in our to direct strong beginning channel well. sales as and

So on and with the the this were our and as note expect quarter. year consolidated items summarize the we XX. for in Slide are winter EBITDA mild our full growth volumes business be quarter take account the this to reduced our in pleased have business metrics for weather weak XXXX it Kevin mentioned more a currency, and driver not significant for to Key Brazilian results would the XXXX We of we're that outlook year. we second year sales full guidance to full first into here Salt a

year and full for of lower year rest our are production. expected Goderich the our with to winter currency modestly our mine EBITDA Our prior in the guidance consistent still view Canadian modestly primary range. we decision reasons winter season volumes expect remains grow and Mild with to on Brazilian weakness volumes the our outlook as improved

the is We exchange currency impacts. the for an above rate year context USD. rate That some well X.XX:X. to assuming BRL Just X.XX now of began on

input ahead. our One it's are we dollars. our and drag very reported conservative capital we to item Brazilian supportive rate significant U.S. note, purchases, navigate as this of While uncertainty other a on farmers as the also results taking spending is a approach increased encourages for in

to We million end $XXX are lower $XXX guidance. to full manage our year of the looking our CapEx to million

potential Before or imminent scenarios. color testing turning business the feel been not COVID-XX the question-and-answer to session, pressure that do some plan provide we've are We like I'd scenarios our how even of any given to likely. on

our in off implemented However order these to health COVID-XX related should of at safety and our with possibilities impacts of operations quickly our range is the looked on mitigating part This and To at chain the we potential will of stave and earlier, virus. variety said start risks and our markets. mitigate end actions a it We've see to the spread to is risks starting safety have We've very as impacts the employees' protocols Kevin the highest what to us help looked of determine the and what employees as logistics as and first we can potential to the supply of minimize health potential wide of impacts. be we important believe stability understand a implemented priority magnitude also additional planning of or financial this possible. echo scenario effectively infrastructure. our

of As to to pandemic counties continue will provinces, we be evolution health loosen various practices. states, the we these continue see stay-at-home and maintaining monitor their safety the and orders, and vigilant in

worst-case to a or concerns. all we our operations an our have were from have While in not extended breach impacted facilities liquidity covenants of and terms scenario in believe of even lower operational material in interruption period what not any generate of for earnings had of stemming estimated have our extended COVID-XX would date, we shutdown primary expect time, to an would which we

our local and all our deterioration significant to to businesses driven will prolonged bid covenants. local see end consider environment. shop is we a to well safety indicates push We near But our America, their because be prioritize in This must decline know theory this across to broad-based states include state states possibility if and at decline roadway and governments North by as this decision negatively by a markets, Looking and we also believe in in the our over municipalities highway for season. would analysis season and public nevertheless, in option municipalities and not that need that and would us as could from a don't work, choose are lower base revenues impacted. be deicing an for through state current travel requests tenders tax year's progress This conscious these bid constituents safety. spending as in we debt reduction tax a and of able maintenance their significant next

that, would Supercenter improvement of retail include throughout home shutdown shelter a and worst-case salt and portion to industrial addition protracted our of scenario hardware, volumes our and In stores place broad in which distributed. a order large are a consumer

Finally, in order is we these would reduce damaging as and for fruits, demand such nuts to think to no for reasonable prices decline of of need farmer fertilizer historic this see a global specialty specialty and crop vegetables situations I SOP. drive something way boundaries. in deeply Again, in we demand which expect specialty terms of like specialty all might to to crop significantly profitability, hypothetical lower, in that thereby happen.

we could these in range? of below guidance the example, For previously EBITDA our impacted mentioned all areas year be in and partially Maybe. or current at

refer a boundary. of certainly edge at reasonable as to that I what is the Although

at developing, today American what we can that our mild with North you winter. are are bid in bid right we expect seeing that looking is fact, tell would In deicing line I season requests how a after highway the

Plant and as well. April that in has Our very first quarter businesses were continued in the strong Nutrition

short-term While in a weakening crop long-term destruction. expect second demand of there would is around nature the the be to uncertainty half year, some versus any specialty we economics case in of

environments. historically have even Our cautious optimism stable very resilient underlying relatively challenging in and the fact been is markets based end our on that

around corner these However, basis. and prioritizing times, so mitigating a are real-time looking activities the we're that unprecedented we on know

impact We on depending business. a have to approach cost any multiphased established to our of the severity savings,

We have changes made already some help costs. to control

we roles limited in is to entertainment travel After commercial critical to have later discretionary are ban overall. travel we and restrict looking we this areas. reduce lifted activity And month, activity hiring all finally, example our For only. plan to spending

turning to on sitting on today. we feel position, liquidity our and and boundaries comfortable very our debt XX. structure slide here reasonable current liquidity our current Now Based

out our refinancing the pushed liquidity XXXX Our maturities significantly debt improved position significantly. of and quarter in our fourth

the of $XXX in working XXXX. of the including in see further would due can don't I'd come million capital place our to of further you senior IRS during To the add schedule our receivable as the X.X million on until note well. to notes first facility maturities $XX This a As prior in large which are quarter securitization an free million maturity Last, million program quarter the page, we side put bolster we in position unsecured refund have left our ended fourth quarter our in liquidity in debt generated just when any ratio cushion, particularly U.S. tax and accounts cash $XXX flow to the working with net $XXX peaks. adjusted debt-to-EBITDA we the like again that requirement times. compares year we

or strong expect cash times. For around year XXXX we the at ratio expect full and year flow free we to the end leverage X.X with our

session. Q&A ask I'll to operator begin the Operator? the Now,


can from Stifel. Please Anderson ahead. our first question go Vincent Instructions] take now [Operator We from

Vincent Anderson

thanks Yes, good morning. and

to you And $X cost of mentioned ton miner continuous cash? think expect that do decommissioning was per a I going much incur the this charges forward? quarter. from similar How impact you

James Standen


morning. So, there. noncash Vincent. Good was thanks expense that Yes,

little bit. a out cut You

were decommissioning referring the Goderich? and the said you at the cost you think -- I to

Vincent Anderson


James Standen

right? that Yes. Is

those of noncash we was parts able CT it service when of So and refurbishment, giving got came there so older out and that And we behind some to or -- those expense we depreciable to into on that its for in wouldn't now another a that expect us -- the life will and parts four years so. have match put first And related of were taking that. upgrade that. parts kind refurbishment with kind some there of those

again. that see to expect don't we So

Vincent Anderson

going of? capitalized on these that up aren't into following new being putting fully these disposed was there then development? unit Okay. the expenses and for that related decommissioned on roadways And just are use with that, mine mine development? be the are carving then to that into is And out going area being Or this

James Standen

the out in thanks. The add older machine fact purpose things. roads you XX% pulled and conveyance and the very previously new want Those there? We service we the to in operating the not anything A Crutchfield talked improvement Okay, Kevin, the that driving system is are do two different we flexible started roadways. service to it took that at just that unit is built for have conveyor now train. of - referred that's well Kevin Yes. Kevin versus new machine that's the about

to the So the the area. production the old the illustrates off the is that. the It's We in Northeast we call mains. map There's developing in pulled new area. a unit that out them in appendix -- unit start

that of the So that work part last calls. is plan long-term mine several we has which the referenced now commenced on

Vincent Anderson

not Perfect. And cash it's being spoke Okay. at that's Goderich about cost XX% just inventory, by what the is the of going you I we'll to as in so see comparable clarification. today? measured a assume as the in appreciate point a directly into mine quickly then you see I term. average as But rate it down clarification, XXXX. your year-end savings run at that near exclusively unit or XXXX

James Standen

mine. That cash savings XXXX would XXXX the at versus savings, be our cost average

Vincent Anderson

Perfect. Thank you.


from next Stephens. We ahead. take can go Please Mark from Connelly our question now

Mark Connelly

relation terrible? is described Kevin Goderich you where that tell us Two you relations relative to at union took Can today you Thanks. things. when you over think as terrible.

Kevin Crutchfield

to exactly, close pretty that word I but it sure. remember that don't using for was

us. call, think much this they George addressed on situation the the on better. permit with way partners him comment well. we have efforts is of the due and They're The are he's I there to can I to as

on. relations with on we we agree partners things trying would I improved. obviously, and that everything work them And up don't are but the to agree can on significantly as there characterize We

relations characterize you're view a there tough to and you George, I long that? as them now. as ways The mute. darn pretty the we to strike period, like would right us add good to a We have anything was go. with partners but would up on George

Jamie Standen

It having George like looks problem we're with a there.

Kevin Crutchfield

Yeah. It we're audio looks problem. like an having

Sorry about that. though. much But improved

Mark Connelly

the prices Second the changing. very producers. now to be disappointing question some And upgrading means in commodity might of economics performance is XXXs, potash seeing we're low from that are which SOP those

MOP upgraded to to that think going the is available, of about maybe more you sulfur Do more guys that on pressure obviously we're know upgrading but Now that SOP some than else. putting market? easily probably economics you anybody not see

Kevin Crutchfield

answer Brad let please. that I'll

Brad Griffith

I said and I Kevin. I concur Thanks, certainly we're think previous your What It's SOP, assessment something sort calls, And with going always on our we this to eye at commodity around of it's too think potash. we with Brad and we on, dynamically. Mark. keep would look Griffith. Thanks, Okay. that would price

all. that proud do Saskatchewan. We And is a Wynyard MOP, we are you of exceptionally and into about capacity. agronomy And differently. respond the with of North last our Ogden sulfate point upon and consistent you people this the and different. we piece sensitive if a as really agronomy. getting – and year time stay were to ability key the assets us have customer at supply keep all that to commoditized to again I Utah end ensure And allows is on centricity in I to just customers. talk product, our want We year think the And that last agronomy chloride pulse to time Jamie we soil quality users a as crops our reflect applications America think potash our difficult producers having continue of had provide closer mentioned, specialty And

almonds make world's example million XX% you X.X of in almond investment. so the California, And supply you're acres you're for going of when that supplying and have to

of now. right seeing And the so experiencing that's that in terms strength we're what we're

a - again utility there's crystal high It No. again, we compounds. willingness need have the tell producer adapt to But I you as price do that to the And difference between So Mark. what's for I we'll high? and pay happen? exactly spread to is. – for to a SOP Is the the think going ball MOP

Jamie Standen

just add there. something would I And

probably sulfuric a which for could benefit bit is a think down be convert. somebody to wanting price acid I

side other would global a that and the course, credit the need That's the of Of upgraders, of is byproduct by of construction and many for is whatnot. PVC HCL the driven which down. be

if HCL So construction slower the weaker is is then too.

point main a for then and to the selling about So those Brad goes that us. that kind made of bit it back value here offset

Mark Connelly

if I Right. in. about one next winter the Will one bag. sounds could last you. more Yes. like same? carry be And or inventory Definitely a you Thank mixed looking squeeze just into to

Jamie Standen


about is as our The we rebuilding – at And We importing improved about. further. that depressed we also Goderich levels mine above our kind our were winter in production did and that very already our as we are business we've inventory Salt of this talked good as through talked we – job imported XXXX-XXXX. So, got the inventories be of of with XXXX rebuilding we plan. a at that in about and well and year. we won't running great really we're We're excited

million, the so of bid we capital be in kind on of on at year terms So And that cash would working upwards look right winter. season. to the get course, inventories always levels upcoming draw bid of $XX of how or plan for XXXX average at draw in a this those based we a

Mark Connelly

Sure. much. That's And great. imports. no with you Thank very also

Kevin Crutchfield

Thanks, Mark.


you. Thank

will Markets. Capital next go Joel Jackson from We now from take question our Please BMO ahead.

Joel Jackson

questions for few A everyone. morning, good me. Hi,

with so that be inventory how in seems Jamie early? I be about for channel customers? or expect the little elaborate consistent bid situation average you And below somewhat Jamie its you and bid Can a the The any bit? can for or think, spoke far the what you coming Kevin to seeing you season to in volumes this governments winter. on volume what about might spoke and this expect give information season you're municipalities you down the we bids a

Kevin Crutchfield

reactions think Jamie kind normal. high and look to participate typical us. they Midwest not after to a are as just hit Brad we but – of me Canadian to had, of weak Let a at affect winter. I I of in. going that's the characterize and market markets there don't And markets mean, over I we after so fill kind level, mild winter it's Eastern then Northeastern that kind the pretty weak

So, Anything that? guys nothing all to front to would seen mildish bid a a add to season you Brad normal COVID of following on and shaping that kind up at Jamie, very like winter. be related we've to this

Jamie Standen

at ago, season, extremely we bid for XX% or historic and back look extremely saw years we mild XX%. mild so. winter you If around were were mild Requests winters quotes down just down following a few

ago, X%. three down a Just two about was or years it mild typical season

seeing So range. bid that commitment we're requests in

Brad Griffith

to nothing add. No Yes.

And nailed now. it. think in the we're throes of right you the I season

So going in…

Joel Jackson

of about levels? helpful. continuous Very Brad. you seeing perspective cost comp in right me $XX about pre-strike Can Goderich XXXX do you helpful, some and in operating XX%, the numbers rate That's versus costs mining At and compare excuse Goderich expect you -- run down on you to pre gave now Goderich talked a running plan. where above

Kevin Crutchfield


up Let XXXX tea statistics me the get some and and XX% were But we're XXXX of at least at that. you to hit out maybe production high-level increase. XXXX more what can expecting volumes read XX% year-over-year. leaves XXXX want you in to

at characterize -- expecting said number so would characterize that couple or that so in base to least, I beginning year another basis slow. XX%. of mentioned of an and improvement of a the the down half I necessarily increase, On So we April up pretty of we're will Cost-wise, XXXX the XX% to as he this conservative. he is The down rate XXXX in year. end script, quoted LTM at back and the were bucks as would his but Jamie XX% the

it Goderich George once said out comment. handle I had back like a think And I audio I on doubt, we'll there along no right but the -- an the on George of direction. on him the in as long-term. did round team gorilla get will from was. job hear it's got do back things back labor that nice it the getting aimed have So all getting done it think he's online want issue, now. that. we to I to important a be straightened XXX-pound have us and And at and I've

to piece. just a color little around him the add labor would ask I So

George Schuller

Yes. me? you, Can you hear Kevin. Thank

Kevin Crutchfiel

George. Yes,

George Schuller

I That's great. completely is have a But core strong were to of look experienced area for And the been past, we look, as we we real call again, as value I out think some from We really as again, of in safety to I lot cycle good Minerals. including that there good. common our point, this things at across workforce. equipment. referenced improved. management, able when want think would site, And is do was Kevin back some And around issues focus started you engagement a talk life much Compass has our about Jamie where a a say but the base, is. at the it lot Yes. look to that is We said, at Kevin a us ground a said, go it's earlier, Goderich

from that operation. And right great So lot derived that we're a doing our lot things of of at a workforce. is

So thanks Kevin.

Joel Jackson

not basis before just of for winter. prices question. they're oil begin bid I and over one swings wild pricing compensate more diesel happens the season risk on lot a -- the contracts, the well season your bid in I wild as and had delivered And Obviously, a freight reduction for the with we this think

freight oil special next nine a taking if make more end don't prices figure the up sure, Thanks. V-shaped about you do a some it able costs are? bidding to be you'll to about the months? Or really levels because take get to here bit risk basically matter you, it little recovery you for process? can in have Does transportation out where you So we across talk through the

Jamie Standen

Thanks Joel. Yes.

question. So, good

for through end to works ship up to right year way this around and some of as its our So the into of use quarter Brent assumption the and with we now, to full as We've and Crude winter. ready rail XX. kind Brent would our Brent impact barge the that year of be fourth a at vessels now look summer the -- about down extent XX built XX and lot at that we plan stays by

our So, a significant pretty full year That's guidance. change. in

and about talked haven't guidance we'll yet, specific We the to segment second quarter. in half back get that

XX, fuel quarter, that can you if $X I mostly benefit could of stays So $X we -- but see to today million $X fuel to million if is at fourth the stays tell in it here. where million

and back if it and we've towards of which faster expectation rises heads course, Of depends and economy demand the diesel. seen just XX, on for some gasoline

would there. those the So of -- some that variables be

the take in calculus to booking -- in through out, not a we from winter. in our we our process season, delivering we our unusual. include depot relates and a risk bid bid in bid the bid this That's between go season these to it that as always As bid absolutely our and it

at we look through looking, make as bids optimize the season appropriately our we include So we that forward estimate in and to obviously, every ton bid always fuel produce. prices, of our the go value

Joel Jackson

you. Thank


Please We next take our question can David go… King. Silver CL from now from

David Silver

you. Thank preface have my away. did step to going Okay. just I'm to I remarks,

my fourth I when it it or I repeat little year quarter, EBITDA the margin apologies. it on seems guess, by cash you high make did and found first was sales struck your volumes. a be unusual and if the My ago, I adjusted ton. And per results, just a business So I yourself margin segment I SOP I to that question to the the a compare when given compare bit like really contract would the

attractive pretty more down just of you line the was if of fall at walk you. segment? that to wondering Thank volume why didn't I through the a kind So EBITDA could seemingly in price

Jamie Standen

Sure. I'll one. take that

David. things a there's couple So, there of

prices talked lower it. plays I about. did think generally, into we see mix We geographic the

product SOP. three groups within have We

highest got and our production. produce that of unaffected Wynyard actually we've year. So was We out highest last quality price,

So those of are volumes similar year-over-year. kind

year, the wet The other lower refer or the two weather. -- categories compacted because versus Last standard. we of non-compacted tonnage And and year-over-year. cold to as was granular compacted or

So, lower margin business bit little that there. is a

part to of Brad, you impact. want the So add that's bit? do a little

Brad Griffith

other that is thing X,XXX only had another The ex-U.S. we went tons probably Yeah.

on So price... net impact an your that has sort sales of

Jamie Standen

sure. And for margin,

Brad Griffith

Potassium+, I Yeah. we actually on ton the we've at a versus basis. prior year themselves margins pretty as pleased with per margins And been look the think on

Jamie Standen

be mixing in that into of the other North America. would micronutrients business Yeah. factor is And the then kind

Brad Griffith

quite has well. done Yeah. I our micronutrients business mean

XX%. Our Jamie so don't volumes there mentioned stronger are as margins seeing We're and and -- up well, adjusted gross Kevin and ... again, in up as remarks, are XX% think their over I sales

David Silver

So hear I if you can don't okay. me, know

Brad Griffith


David Silver


kind were You of out. in and cutting


Sorry and in just cutting out.

something fairly to thinking question, and been my this and So head it's more I've theoretical, one going is I'm about. ask but scratching

say traditional state the also the this could starts going substantially at call warm six volumes would winter people season kind say my do well, say, get when tax on what head your upcoming be could conference lower. demand chlor-alkali order sometimes the the and maybe levels. there's -- peak over to recession, could And city of around revenues be could that significantly scratching if year time, I'm that that just down and road. it to going months we're back mean this So to the substantially a in selling sorry that in that I'm inventories you for down that this and level I'd global be chlor-alkali the prior summer below down a be industry production moves are

full kind planning from too of your local your what's little leaves a So chlor-alkali ability inventory, soft the or that pricing of turn impact would you an industry of in for to. achieve that at to I and mean industry hence the purposes, chance the unusually and pull-through level the the from that either hope salt state tight budgets

coming wondering circumstances. I'm the we So get from too a or an peak there level of -- of kind but I'm it's unusual set into just a getting season, just high if inventory could non-traditional an of oversupplied to circumstances. next an -- a of kind of set from different

that but Sorry sal concern. for was my word that

Brad Griffith

of to with and mild day, test the worthwhile part this But mild that But collection the sure, mild a safety bucks. with are Yeah. say as lost we a about to mentioned going it exactly script, It's because where comes It's of given is But public a safety collections fairly that's day and are small as for down size. now salt thought we've roads And going stress of they're all that. public going few seeing over belief we're risk. I'm going a what consistent is tax is question projected long, compromise a they DOT's believe not to in us on end to pretty I fair that is winter. are of tax coming off mention that given miniscule icy unemployment take his to the to is save it's percentage somebody piece behavior winter, that rates be where a right safety one Jamie think point, lot planning on a be people winter at budget, the any is our and it's the especially not either economics to represents portion. scenario off. And

winter in bit can't the bit So less? say, signs season make and mild like and we're any But, that the a perhaps. going thus Yes somebody see because could far. we little that buy we're a to bid off well, of little a decision of

David Silver

Thank Jamie Thank you. and again I much, earlier. that with very all apologize covered you

Jamie Standen

No worries.


Shaw next can go We Crespi. ahead. Monness, question now take from Chris our Please from

Chris Shaw

shipping everyone. morning, lower costs doing? on I to question oil. How you’re good follow-up Hi, and on want earlier the

Jamie last I if I And called with the where impact to is. when $X -- the versus company fourth know -- most looked for $XX I crude think or shipping benefit. period I back you I stays is it crude the -- you're a what ton modeling the gave out up to the a -- think Just $XX. curious, for $XX was think like now be? -- of more quarter know an But And mean Brent that might XXXX-XXXX I year collapsed, year-over-year oil I impact

of stays over of to it again, could for that big trying is So impact year-over-year -- figure the $XX that -- what if I if the half? an second what sort just benefit for how was be

Jamie Standen

Chris. Thanks Yeah.

more said, color fuel guess. what contracts Let to surcharge. certain on a me I've have I Remember floors, bit add little

getting anymore So contracts certain not falls you're some are. benefit, a way any of the level, that's below when just fuel the

barge. by have of truck rate being Now in place. lower, be some just by that said, in Fuel can you particularly agreements expecting varies we That tell second that by are truck by we significant contractual being mode, half benefit some vessel, benefit. and the year, in can of -- the side, on a truck, be fuel would barge by the that headwind because a vessel. I

on through side headwinds, there's as got the coming well here we've optimization about I that program, I enterprise-wide example. barge freight for element work one to our benefits of that, So, some talked would offset as -- those other and we

So those are coming summer. of back the through as implemented year, they and half get now the

than we it way. see now. just to kind the depending expect -- on that, we would how -- rest generally, I better where That back in how see would the fourth -- fuel quarter behaves or the of would it the in flat, be particularly right So, of

Chris Shaw

And headwinds? the reason costs what's are barge the

Jamie Standen


Kevin Crutchfield

It's -- you Brad? want to of bit a color little get

Jamie Standen

trade to and has we grain do It with where are.

Brad Griffith


Grain I movement, a think, post fertility XX they've down follow in and go if impacted, large year, the of the the up fertility the for tariff spring, you past impacted. barge last themselves, and things shipments certainly steel was companies had XX impacted, now over to hard moving of months. Mississippi

I a handlers a had a time barge number profit. pencilling so, And think of have difficult

And fantastic then, we'll out came we agreement at of meet be short-term We play that market to way. So amount market And in feel go time. the did comfortable needs with not in very in we will long-term. we've that it to with carrier a a signed a to want time. a that markets. our reasonable We

impacted are other movements back may thoughts over that will to we a rebound. certainly to probably I out will for But the systems the that long-term. come steel has will time point the time. at market. And mean be better be probably some there along believe been waivers normalize coal Our

of So for the these the year our kinds supply enterprise-wide mentioned, in chain identify to optimization, we've our effort teams to the second diligently opportunities as of had Jamie logistics through worked savings and other with half thing. best offsetting

Chris Shaw

some the on in there industry with and Is have sort at then, Salt the into the from been know of production season don't I it the now issues. in right having is years were issues, any scuttlebutt Got you the supply past of? there point any side competitors there know restrictions competitors -- that the this few supply heading

Brad Griffith

well And To us None execution, goal as you the own to this particularly on sites and displace run enough to we've first through target longer and imports and Blanche operations can running I gets on operator, but what please? here. before run C&I us going successful runs addition that, normal optimization. And you're our the we we're we focused into now. as was aware said produce Could our which that mute Hey I in can stable. we're you up other in Goderich that we're quite region. enterprise-wide well our doing imports term of, tell with think then, year. to is, our just for Cote well mean call be the making

we this a said, the is yeah soft season So, as winter. given weak

will the the lack just will take be on because that the relative positioned it well the are I more, think of nose served folks markets. of imports first supply that it the to to margin

Chris Shaw

That’s Okay. helpful. Thanks.


now further are to questions There at time. the closing the or on remarks. any for additional I turn Theresa back no to like call line, would this

Theresa Womble

Thank you, Marjorie.

have to you are join today. the call us We glad on all

have you questions Department. the contact please Relations any If follow-up Investor

website. information our Have on can find You a great our day.


may Thank and Ladies you. for participation. your Thank disconnect. today's now That you you concludes conference. gentlemen,