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Compass Minerals International (CMP)

Participants
Theresa L. Womble Compass Minerals International, Inc.
Kevin S. Crutchfield Compass Minerals International, Inc.
James D. Standen Compass Minerals International, Inc.
George J. Schuller Compass Minerals International, Inc.
S Bradley Griffith Compass Minerals International, Inc.
Mark Connelly Stephens, Inc.
Vincent Alwardt Anderson Stifel, Nicolaus & Co., Inc.
Christopher Parkinson Credit Suisse Securities (NYSE:USA) LLC
Bria Murphy BMO Capital Markets Corp. (Canada)
David Silver C.L. King & Associates, Inc.
Call transcript
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Operator

Good morning, and welcome to the Compass Minerals Third Quarter Earnings Conference Call. All participants will begin in a listen-only mode. A question-and-answer session will follow the presentation by management. Today's call is being recorded and replays will be available on the company's Investor Relations website. I'll now turn the call over to Theresa Womble, Director of Investor Relations. ahead. go Please

Theresa L. Womble

welcome third and outlook. call to today Good XXXX to results our quarter year and discuss morning, our rest of

We Standen. remarks and will prepared CEO, begin Crutchfield; Kevin from our our Jamie CFO, with

Chief Joining in session Chief as Q&A for our as Schuller, Officer. Commercial Griffith, George are well Operations Officer, Brad the our

X, involve Before we represent everyone filings as view these located and online our of remind in today's our found company's could operational of remarks cause outlook our investors.compassminerals.com. expectations discussion can risks the differ actual get that started, XXXX. date, that uncertainties results SEC be November of financial risks materially. I'll today we These and the make A at to

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

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

Kevin S. Crutchfield

Theresa, for Thank earnings thanks is for so you, and know to XXXX our many call. of third earnings this everyone. a join quarter busy I the day you, time taking morning to good

Those markets. the key by United driven in were South of very were in issues last are primarily published extreme earnings our and markets American North we products XXXX levels. nutrition delayed in ordering our and States. to several related timing prior-year as both part weather release As quarter North third Brazil results American reasons in for delta, below well There night, our western wildfires dry that of plant as

to the discuss measurement my and compared focus our rose EBITDA quarter operating inventory for XX% in Jamie performance. we which Ogden, non-cash at earnings consolidated our instead I'll these on shortly. disruptions to unfavorable be adjustment XXXX related period Utah detail year-to-day year-to-date increased more an facility On short-term, stockpile a error reported third remarks SOP results. basis, market expect in Because to bulk also an XX% We will

million $XXX strong cash first from which given as our XXXX. stemming from a In winter is XX% very the a March. the the are of well fact in experienced as markets operations, deicing from flow of all in results in addition, over quarter operational the we increase that we pandemic mild generated global These beginning challenges

the We excellent safety on in trajectory terms are presentation in also our of our we highlight employees. of the

say shift the priority arrived. As many our team is as of their home heard a go one as end as me of when healthy at before, you management number have they ensuring our employees

Our focus of has on stakeholders it toward this Zero been the career been who current productive benefits has Harm of organization. time as is knows pandemic And the sustainability ability that, as this critical time navigate safest operations. focus value the mining our our anyone all it as culture spent again in their has to proven are to over most also the and long-term, the operations the

incident total see or TCIR. This continued a decline we to case our quarter, in rate

time their like exemplary facility exposure at specifically Ogden TCIR average, rolling the safety very was history would hours that in to achieving very our to million of near September TCIR multi-year our also I'm of the in commend with month X lowest XX-month low incidents. company. the I for to performance. addition a happy In any our employees the for achieving share to among safety lost They're no

clearly a a in operational slide discipline presentation. X song volumes every a day. but about to this may the on As jobs of improvement and glad safety responsible for our sound employees I'm our improved continuous the and discipline like to our it's success, metrics see really operational their leading of sing. operations and safe speaks I Salt and quarterly We record highlighted this our indicator execution commitment impact business bring to here in each broken

to year-over-year strong continued mine Goderich deliver production Our very results.

quarter, to to the cost produce strength On as new salt XXXX metrics basis, increased both tons build the year-to-date XX%. ahead a and These ultimately For help production levels platform steadily down long-term. these volumes plan and cost there over mine continuous we have of Goderich's while the XXXX costs mining volume the were production from will in our there tons perspective position America a secure mine declined quarter leading of XX%. to are XX% North as XX% which third the from continue our highlight production improving results

meant one mention Blanche performance demonstrated posed XXXX. Cote in moxie dose not the and we've resulted efficiently events lost in hurricane challenges production by seven during of by storms also made each been meeting but team mine These event. resume an site strong preparations third days to four four production in lost people our Our production to our has able year-to-date, and effectively and by of significant impressive protect quarter days the The October. not the safety another after to the

our agility, if the from lost the end to unplanned testament the production to expect all, another those year. we operational days of outage not As most, make by up

costs. our logistics effort, of the terms enterprise-wide quarter, Salt also lower early This particularly segment optimization delivered from benefits in

maintaining inflation this than using typically customers. tons our operations Our multiple savings we work deliver of we're network maximize the transportation the across bulk move of offset efficiencies Their of materials that helped to has each modalities experiencing levels freight in of year. service to has million diligently year. Keep some our impact more XX short-term rate reshape worked partners for mind logistics team strong while cost to to our

in and efforts mild teams impact as well overcome effort impacts engaged the average optimization customer volumes the looking lower prices pricing us achieved opportunities to have Consumer this adjust also and year-over-year quarter. the levels. Industrial highly to improve selling salt for enterprise-wide reported for achievements XXXX as X% as been sales. the far sales on were Our drivers as the for well These responsible mix of COVID-XX were in due we've and so commercial weather largely for non-deicing increase These important expansion helped margin winter

to moving I'd Before XXXX-XXXX provide American North season. the Highway a final on, on Deicing update bid like

be results. mild in last we during weather was (XX:XX:XX) second winter, the this application with in as of completed extreme This has delayed quarter call roughly wildfires no delayed drought. The our from price nuts. about noted have sales fertilizer bids to and provide past season soil crops, bid quarter, made essentially also that all plant has deficiencies We've of came the particularly these particularly for circumstances to volumes are and the total results expected key with smoke including tree bidding Consequently, thus prior it the XXXX, XX% harvest fall particularly the season XXXX. the our agriculture tenders improvements that these bid events been activity surprise have Recent as for for logistics in portion confidence XX%. issues season elevated strong products. thus sales these some inventories the achieved tons for driven underlying the the cost our growth very believe remains X% Ultimately, in our a given third and conversations Given believe harvests slightly customers demand down that hurricanes products some we of contracted with trimming our season America with to into sales a sales faced North bid and some guidance into season have of deicing decline to by experienced in bid timing quarter salt After of full-year our our bid a hitting expected fourth we us nutrition to robust volumes translating pushed customer nutrient Similarly have lower the along third need reinforced some quarter, Brazil, by volumes weather are that of XXXX and our we salt winter Louisiana, quarter. production volume and very we were remainder XXX,XXX second expect with business prices. quarter. we've the strong unforeseen Similar accelerated. offsets compared

in also hot the that has geography and dry been Additionally, weather unfavorable.

South we for to in shifted the what be expected very has third quarter of to note, attractive portion sell quarter. farmer continue a fourth believe positive American the particularly we into a soybeans. On So now economics

soy fact, has means crop sold and need in will that farmers thus our of the yield. Brazil which already need specialty a support to been forward yield record-level In nutrients plant

these for America challenges the impressed result ranges backdrop of XXXX, the I nutrition we're America, through in the As positive value commercial, XXXX unchanged referenced focused I'm market streams; volume Against of underlying and more from our Brazil North North and efforts optimization of enterprise-wide a both of logistics, segment faced South the the our and effort. and even with our segments. our in in working results all procurement we've sales benefits these fundamentals capital. engage streams. plant for five coming employees comments, to on my on Salt operations, value early namely broad some This effort previously is certain of execute keeping

incremental organizational facility. regarding also recycle last Ogden, well project our I'd our a Today, as product fine minimal to very we're focus to a mine cost. We salt our at Goderich like making quarter, health at highlighted saleable through compaction with waste detail the employees as a engaging the Utah progress at little project exciting share into essentially

we equipment potassium. two production XX% processes just equipment of of can ponds those increases for more material final XX our this the is site this work harvest to dried our do can then we brines and the salt. Anything in optimization we in further globally the tons extract advantage evaporation deliver evaporation spend typical material the this expected SOP the per production spend XX% do with lowest the season by about a to project to activities expand change months increase months salt delivering As ability insourcing and salt After load beds globally. our of at new faster scooping the feedstock which of more for know, year, our SOP us the the and competitive load the pond-appropriate In we're pond setup, you condensed The equipment, harvest extend allows decrease from transporting our solar and which essentially per period. many up of and the evaporation The Currently more and is SOP plant. from ponds, to to our so, pond-based feedstock yield feedstock tons under and we stage. materially using form from to very material both plant. Doing low-cost SOP is cost it haul of that length among harvesting that. draining produce domestically and for goal to specialty is

be and more season shorten feedstock. result, four with to months harvest we're new new to to further higher extend is months problems Further, SOP and safer expected to for ensure our at sustainable project quality our provides company. able the equipment which this As highlights and to to ultimately our our season evaporation eight ponds, our innovative and sustainability a us reinforcing old growth generate long-term and practices. help our ability of solutions look This harvest

execute our we have In XXXX. couple the the to earnings original projects on reduced we near-term, throughout the continue As work factors fundamentally value to years of expect improve continue to the of overcome over external for which aggressively Minerals. these earnings the next outlook various potential to we compared to our streams, many Compass

progressively employees with February. and we is laser-focus customers million with challenges combined personally winter a role in with and with essential as These throughout serve deliver unprecedented the that cost improvements customers impacts recently challenges well growth industrial largely products. our COVID-XX year factors we stayed important products to of with improved from We and operate. on full-year using an strategic to buttressed original our operational to EBITDA of for strong had priorities and our expect contact a about the chance the still first their a currency growth guidance this where on our bit, appreciation demand resilience these $XX possible them preventative our impacts were certain and forecast quarter, about in weakened several assets including customer drive external of markets outside close expectation We've a the opportunities, we and level-set XXXX. even maintained of perspective the our communities we mild cost weather by we Despite sites midpoint impact and Brazilian serve of I've of throughout the times. on dedication our the include because to of XX% performance, have greater for through at both and these a and to the measures in for growth through and of which EBITDA negative the advantaged control. essential talk own estimate now year through the around provided as a Just their additional the nature strength the the our number our This for underlying optimization our growth our also of of course products, effort. our the entered

great these entire excitement Compass team. for and things generate All the of me

hear Now, results and Jamie more will the detail. who from discuss Jamie? third quarter outlook let's in

James D. Standen

Thanks, Kevin, on factors discussed. with I'll challenged everyone. were by good our X and which several morning, as comments consolidated on slide results start Kevin some

quarter of versus the First, each segments of sales volumes were third XXXX. lower our in

Salt which XXXX. than pulled basis segment number the XXXX. we're volumes due weak basis into to by weather timing we winter on a are quarter a across a first-half just segments all down sales the issues of is However, year-to-date actually explained on of which during more three sales X% experienced the quite of performing first year-to-date well

quarter As quarter therefore were first their the a the and on minimums quarter sales you markets. average pressure XX-year weak to which fill very North put On in XXXX below rainfall orders. our due Plant recall reminder, XXXX This year-to-date customers and period, in America served may levels. challenging snow caused early take a XX% excessive our weather was XX% below second the are versus basis, events XX% up third the Nutrition to XXXX volumes

a America year-to-date quarter the strong of as in in volume year sluggishness. South early segment for and third first-half demand basis increase plant Our sales nutrients a Plant on year-over-year X% Nutrition the offset generated

as the primary inventory segment flow of in Plant Nutrition Salt volumes of through Plant consolidated months earnings the growth decline. of segment XX. Lower XXXX nine cash were America both well offset quarter North third an drivers Our segments Plant results delivered slide the Nutrition operating Salt both discussed the third operating our lower the double-digit million in challenges results We third results on we and quarter charge quarter $XXX as quarter first helped businesses. Despite of and faced, year-over-year our EBITDA we free in strong XXXX. year-over-year earnings adjustment the third Nutrition sales

Volumes increase Industrial for Third quarter compared declined average sales the slightly selling in a XX% volume, our Deicing XX% and drop a both revenue on year to in prior by prices. X% offset and sales. declined Highway Consumer

increases in X%. average logistics third to results, lower In and and costs average Consumer the quarter third to A XXXX flat sales in and are of we X% addition than prices experiencing challenges. improvement net and towards demand offset chemical demand with earnings XX% still year-over-year Highway slack actually resulted for effort. and Average Deicing we Industrial a X% increased result of net X%, products, pre-season price Consumer price net adjusted in due XX% lower Deicing to year-over-year a strategic Improved year prior selling XXXX price of in for lower other Highway deicing shift third compared priced sales in increases up third X% basis, some the quarter quarter enterprise-wide results prices Industrial our to pricing largely and price selling operating while for XXXX in On production optimization achieved and revenue mix for Consumer COVID-XX to XXXX as results. down Industrial price implemented pushed EBITDA. increased products a more quarter selling due average versus

aggressively improved our to that production, driving initiatives procurement and implemented Goderich logistics lower. costs have In across addition are we

have Kevin waste. spending Beyond rationalized to our patterns the improvements reduce we mentioned, logistics

of with contractors upgraded key in of negotiation quarter optimization comprehensive segment also Salt with to agreements all pricing favorable have sourcing efforts XXXX. of material of raw and the achieve more our EBITDA to expansion XX% compared to XX% to contributed across the businesses margin scale. efforts We the global These third

segments to Salt over sustainable pleased drive benefits for our expected see improvements we're in results. these While are these to all early initiatives time,

on Plant results XX% in which prices. Turning volumes, selling decline in XX% a we a X% a XX, revenue year-over-year on and America higher slide average reported decline Nutrition to our discussed sales North we

start in US demand. noted, shifted and of season SOP SOP the various western facility. to system that reduced Earnings application the Utah have the through due extreme our wildfire the SOP identified the This in towards compaction at an we of this an our adjustment error we that timing of the the As year. already of the inventory stockpile have the bulk standard is believe high-value for customers conditions into the fourth they delayed sales segment further our then and stockpiles were measurement quarter product we grades Ogden, our of our process by

of assess and and the size the this regularly our domes we due be storage to difficult While our estimate accessibility size of limited to stockpiles, can silos.

our our standard SOP the fully a time implementing several particular processes these identified for of additional we to we quarter prior that America profitability is South are will shortfall or segment. the North impact our demand by cash stockpile out Plant years. and agriculture these on any America this on a improvements to expect future been agriculture domes currency, or a several as products material issue, year-over-year to which As It Nutrition XXXX emptied discussed Once don't to solution we XXXX We third X% control our our had segment selling zeroed depleted prices occurred revenue inventory, improve not segment chemical inventory occurring not customer driven has adjustment Nutrition in XX. and period These decline estimates reviewed furthermore our results detected enhancements flow over single in sales This impact ability we and no in and the average free we chemical period a that this and both this offset solution is future. enhancements Plant serve in products. going our volumes. price increases operational in increase operational adjustment the slide determined for from delivered and forward have of that year-over-year note we important local prevent

as plant on in attractive the for farmer. second due our of a of early pull-forward economics noted for we many earnings weakness demand products quarter Therefore, some QX specialty very the that is showing Brazilian to call, up grower here As our came quarter. third in nutrition

we spring respectively, outlook sales expect volume volumes and X% we rains year. our quarter compared XXXX quarter. in the and was BXB year-over-year compared still sales Cerrado sales However, in fourth aggressive of conditions the our segments for pushing and product have business increase the an region quarter declined third and flat improved our operating We currency, strong force. guidance Both quarter and full-year lower attributable EBITDA applications volumes revenue to were direct-to-grower channel we while third the late our volumes to sales mostly volumes earnings quarter Salt central prior slide discuss which Salt to in in in growth of direct-to-grower impacted we XX, investment X% start prior-year the our fourth In on BXB and sales on our see continued in believe by dry therefore to our continue reduced delayed in volumes sales mix. and direct-to-grower of These our they into are local the Brazil. the fertilizer some sales also

Deicing will due Highway sales to mix in expected by is business this reduction average sales Ultimately, American to and In Deicing for Highway expected compared quarter our we reported X% average we're the North average margin customers. is scenario, to activity. selling decline our price for impacted the be Salt the bid achieved see expecting to of EBITDA an weather X%. Highway in a prices prices Deicing year decline awarded average to contract the Our overall winter prior on price around segment about based winter

our the containment cost creation operating margins with both working optimization value and effort. to We continue on through offset enterprise-wide our impact

earnings rebound sequentially is western been sales demand wildfires our in America, fourth our In strongest their and selling so and be for The to improved typically US improvements businesses. And have the in North in strong quarter year-over-year markets expect should results. we sales nutrition rebound achieving crops, in to that be price of conditions. micronutrients. and sales SOP driven are important quarter. negatively for a In season that drive expected by many sales by plant impacted also both modest and We strong volumes Brazil, the will given sequential fourth forward-sold fact anticipate yields seasonality soybean the that a growers dry

now in underway our rains fourth spring which bodes quarter growing many these the regions important of well well is for Additionally, results.

local to weaker XX% reduction Full-year Although volumes and deliver year. however, our we in operational with modest the adjusted sales reported currency volumes, quarter prior currency on decided expect XX, XX% XXXX update fourth the EBITDA in and slide to prior results, found GAAP full-year expected we weaker are keep ongoing to results our primarily is COVID-XX to commercial our compared growth items outlook impacts to due year. increases to the guidance. EBITDA compared US have expect flat currency to Brazilian we Salt sales full-year In

million are the the $XXX adjusted XXXX. adjustment, EBITDA for inventory million deliver to Excluding to $XXX now expecting of full-year we

we headwinds generation for we and on report still year the pleased expect that very finishing today. cash despite Now flow XX, of free up the have full to $XXX I strong million Kevin are discussed slide around

EBITDA our to maintaining balance position. strong year to sheet Our continue improving we very expected progress below the as net is end a make debt-to-adjusted ratio times X and liquidity

I and we critical on we XXXX, ask operations world. last our to two our Operator? operator products optimizing will focused customers essential our safe, As Q&A session. begin the to costs, With keeping these controlling people around that, the satisfied our remain delivering enter the months of

Operator

please, Stephens. your comes of with the line Our line Go first question open. is from Connelly Mark ahead

Mark Connelly

changes at (XX:XX:XX). Kevin, Compass, arrived of you've a made particularly Thank you at ton you. Ag Goderich but since in also

you people got wondering note, because on there. agree far you're help a paying different valuable And making stand? efforts us could smaller little you suggests that more Salt salt prices hands about we've those hoping than higher Goderich now a two seen at businesses So could what more are you've Is where about lot your Compass. change if they're a franchise? those the there I'm than to anything I with US progress related for talk that understand was of are assets bit

Kevin S. Crutchfield

western now. put an Hey, Mark, together underground December. year, to to things I schedule. morning. (XX:XX:XX) the sometime it. new I'll But the about good long-term standpoint, by of high-level kind wants the the think if It to Thanks for and just a East at CM-XX anything should I taken bit questions. and the Goderich on think the parts look little be George be a to in and long-term talk site built-for-purpose develop by mining I'll of plan even will rooms. at stand some operational add pieces, area see got at overall roadways from on opened in working we development plan, feel maybe really mine Goderich; good that the our We're where about continues of continuation end new certainly – of get We've and up on he

consistently we consistent, pleased very still not have there we We're are. George been. to much going are feel that that the not we see are the the with and anything I much effort a with be the look have at things satisfied going they pleased. up where and It's hit the he cost respect local to a have would to I relationship long question. So about but long with in safety We on I'll effect ways how that at second are We all where site. ways to think they're – union the about to I add overall have still this well. much overall if pretty to go of seeing we to than material higher go. are talk wants (XX:XX:XX) morning. We're And Things as producing more good notes really Goderich. at how evidence more Volumes before your

George J. Schuller

practices. most highlights. mining Yeah. taking and as of guess we just where mechanized optimization used Again, Kevin is Thanks, what Kevin operation where a and around with maintenance a drill-and-blast our around thanks, I went trying be of doing things Again, it's the to to our those hit well really couple long-term maybe as opportunities. to mechanized find we're mining it Mark. we some a of really and look

a quarter we to as is to tone we Kevin go. I'm fourth Basically probably ship the can into there's are safety well. good our of you go opened going giant look to compaction had experienced we as it, where continue we But really on as got how pretty things steps being I tell things. there been my we're with so We've those and at types leadership our rotations, upbeat As team Clearly, from of and we some where where and there, workforce, foundation. a our a highlighted, making steps. call lot started workforce that; really; would start

Kevin. So, thank you

Kevin S. Crutchfield

Yeah.

Mark Connelly

done your George, are or... you with compaction project

George J. Schuller

Yeah.

we're it we're it, not about we call I'd guess, sorry actually doing I in, Mark. what operating We're I that, – optimizing. quite Sorry mean have complete. is now and

tell if about at probably probably That's you we're we where optimization. are, just was to going an I XX%. So

a get of the we you. going make the it's right-sizing, So going kind go. and good to pretty tweaking where sure where at to that little through. to it's right Thank bit about feeling But continue material it's I'm

Mark Connelly

you. Thank Sure.

Kevin S. Crutchfield

the values think point does it assets (XX:XX:XX) think significant think speculating quality made I I the very – is sector and it some obviously rich some adjustments On guess were win some in but they group closely. views consortium cost-out sector I'm and just the probably Salt headline versus Kissner synergies. certainly at valuation your a in well-seasoned obviously very pretty and pretty level, question, closely you it. at Salt looks weather they And But look last them. out see the for public the I the landscape it Mark. watched pretty way second way in to they clearly We've the the made difference public process that and the followed well-respected a the I also shift when the and And it

boats So I way kind out view markets else difference on runs rising we the we'll as my Compass everybody the But in and markets don't And pay It on they is them. as valuation that I view you're continue private assets view that pretty that multiple significant they talking a the the equity headline is way put tide think of view the does board guess well. multiple all point on about. that see a to think public lift improve here quality Salt I versus right.

Mark Connelly

Kevin. you, Thank

Kevin S. Crutchfield

you, Mark. Thank

Operator

line Anderson next comes with Stifel. Our please, Vincent question your ahead of open. line is from Go the

Vincent Alwardt Anderson

Thanks again Nice Yeah. quarter, trying Goderich this morning. good just estimates. job true-up my at to and

With run targets? up rate kind year-over-year, XX% of your near-term where relative the that to your does quarter leave

George J. Schuller

about that Goderich Vincent, is asking? mine particularly what you're Just

Vincent Alwardt Anderson

sir. Yes,

George J. Schuller

Yeah. Yeah.

well-positioned there's upside of but have productivity of very say, had So, asset where we're a are as it and a But to terms been we to versus upside got we've – a very be We're of run. think we It's lot very, pleased put we can from would in rates bit I'd I say of still. percentage with the room little significant still production historically. that producing. where here we hard because

Kevin S. Crutchfield

and then out want be capability a production, of with we it new that force just out the we this to market – in to but fine-tuning you're run unit getting supply-demand function I really get installed, And and a market didn't me of trying done Yeah. then bump think balance of before then probably time calibrating them. And into I will get of we'll and and add Goderich, at Goderich, too the tired see not would reliability. by a appreciable we'll that this it with another we all saying underground once Goderich consistency, as tons run

a problem be would that So high-class we we're to the we're and get first-world trajectory that problem, when point on that on. excited

Vincent Alwardt Anderson

bid you at took last Perfect. were the And just place of up the it forgive share did pricing as kind you me didn't end think you trying did volumes? earlier from pull to of when you tons season of bid of on in to people right, on about this if earlier place were to saw legs the the come you and amount tail you but what this catch season, or kind maybe I scrambling just start addressed down

Kevin S. Crutchfield

with looked on we Yeah. season a on Look, we I'd there not but as, standpoint best We We we pursue. you that the price our to ones characterize do just discipline, were the Brad and might for okay this sometimes that elected deals it some maintained thought it and did characterize you at it production worth. too, were comment with that and went go what cost don't we of was that. the I'd the win; what things we from as let bid it thought

think little to So up from were X% I – ended back we call add with anything we where still we thought which about market a able Brad, we is bit we're up. happy be. down pretty that? share ended to we'd would But where you

S Bradley Griffith

Kevin. No,

I think nailed it. you

revenues in versus fourth the Just comment we said, other quarter one very be And we're on Kevin Salt as pleased up I to bid segment overall year. think prior with there the season. Vincent, the expect certainly

tons both low-cost able been to that were Jamie place George and those of referencing. Kevin, have Goderich We more

Vincent Alwardt Anderson

All right Thank you.

Operator

Parkinson Our line Parkinson next (USA) Chris the ahead comes Christopher you. is LLC Securities Suisse Credit question open. Go line Credit of Thank please, your Suisse. from - with

been nutrition; substrates. on in should we there've just just the couple just say deals a be So both an smaller thought us process how few comparable assets, let's you. and currently? in sales plant about that Can of your a of Brazilian eventual announced update Brazil give you of the thinking Thank Ag

Kevin S. Crutchfield

That's question. Yeah, Yeah. well when and thinking situation we to we through want to in very process. we're bodes not well the we're we just not before. too noted us that the but distant those US? the we Credit closely Christopher and reengage monitoring the offer general bit should do more those just thinking for just color think we'll your if verticals outlook? about Securities so your the that across restart this but on mentioned - Thanks and on the well you. have say different about costs, we future process think prepared probably transactions for remarks Thank I carefully and for know we assessing and reinitiate, bode as how freight for XXXX when you in something quick it be follow-up, (USA) a that you little Parkinson next a Suisse can And LLC certainly the just – call, on on our just

James D. Standen

Sure. Yeah.

that take me Let one, Kevin.

obviously the in we've So the coming year. about benefit this got $XX, year, the going to of be. rest freight as we is fuel think fuel quarter – where some below it If fourth stays

talk into next Salt. get let's about year, we As

America, we flattish inflationary continue we're could – the I working it And you work our those on with some see relief think, be North some expect pressure optimization efforts, suppliers. some in and based should enterprise-wide some certain I the of think think of our relates general contractual first-half back-half in with as to freight. then got we've get In along to we Plant of Nutrition XXXX. things to through we'll

markets. depending Of the course, shifts it's line always there to quarter down our in just delivery. That east Brazil, freight again can versus we're to pressure customer just do alone on have And shipping we and or more due noise quarter-to-quarter we whether quite southwest more see of by pickup the a inflationary to then bit vary. in

there. of sales, it's do that we net again down we inflationary So price But net a pressures. expect analysis just basic would more

Credit doing lot Thank upside (USA) Parkinson we're the Christopher logistics us of in side give say would you. LLC I cost Although to or on improvement a - Suisse Securities logistics. some work there

Operator

Go line Our ahead BMO Joel next please. with Capital question Markets. comes from Jackson the of

Your open. line is

Bria Murphy

assuming improvements Joel. do XXXX? ton on Hi. cost With taking my Thanks lower bid expect Salt you This is season per what normal to weather, assumptions for volume for Bria awarded be and in Murphy questions.

James D. Standen

have a a quite envision – Goderich. actual to see this ready and significant that. margins do don't price not Salt So, of some the need out continued commitments EBITDA an on in the going quarter but to huge is We yet to to first basis, ton low-XX% goal we're at there impact obviously the impact put would on into in that normalized improvement having XXXX drive cost to our bid the per year, cost improvement. We're

So XXXX. But dollars about and we would Salt would the segment. high-level specifically XXXX it guidance about – of entire you talk in a I this on give the – full-year couple we'll expect when is across for be until more we what full-year talk February a our

Bria Murphy

negative Thanks. from That's helpful. mentioned costs. then just COVID-XX lost impacts And you sales operating and incremental

COVID-XX-related I $X QX, sustainable offsetting think looking there through million you made into have, have about savings. are these if you And XXXX? were any

James D. Standen

and spending number costs, those about of of constrained our being through some We've that SG&A optimization costs we have think offset T&E thinking offset a enterprise-wide of but things efforts. just many got of those by

the our significant. but procurement, in and of within of little internal So business that operations that our it's in the our own a number, on there chemical just logistics, sanitation Brazil, side been have down benefit Most we've improvements and seen bit offsets commercial. through not

Bria Murphy

Thank you.

Operator

Our Mark line next please, the with question Stephens. your comes open. Go line is of from Connelly ahead

Mark Connelly

but and I season compression implication? foliar significant wanted to have that a the late more with risk for the a sales and a that up the like there's you pushed to Yeah. also be with it come shift Brazil back would a to should that been end certainly raise Obviously, margin back feels in second. does planting just

S Bradley Griffith

is Hey, Griffith. Brad Mark this

Mato state has soybean at I delayed think in weeks and four Paraná the roughly. Grosso planting delaying three we it drought conditions to when by planting, look specifically,

Kevin S. Crutchfield

Right.

S Bradley Griffith

whatsoever. by impacted think, large, and I not that our by portfolio is

driving We significantly sales there. are

are revenue that's XX% up third our XX.X% volumes, up quarter volumes BXC our is to-date. fact, In quarter to-date; direct-to-farm third

may impacting So, there corn, of could on soybeans. a some of that I bit compression bit don't a any be compressed. If move anything, safrinha a be see

some been has in team customers retail preparation that. online with of Our for our producers working and diligently distribution

and corn So, for Concorde like sales Poly the of is products our our intention crop. with the specifically to maximize several opportunity Blend (XX:XX:XX)

ready. we're So

Mark Connelly

sense prices just pressure XQ? which comfortable down downward challenge SOP and California the question. SOP down Are in Okay. at prices the SOP makes was because you current look does premium And SOP too. more were on as you commodity one fire put with

S Bradley Griffith

Yeah. Good Mark. questions,

SOP factors. at pricing, I as think to So, look a about got number you've of

US, imports. non-US, First Canada for also and reasons granulated to non-Canadian and the the by last the earlier, percentage of so was products impacted call probably versus would quarter to note sequentially the we standard year. bit as mentioned two-thirds we Kevin important more market us lower of It's sold third that were third quarter pricing we're dynamic that had in did all, just what our a a for in and defend that pricing because also the we outside share by volumes pushing export, than

have things a those this little combined put of of bit on downward us. all pressure So,

held producers important South your of that and demand in to range. the MOP, that markets continue part question see have strong as it's it in the traditionally Middle And Now, has you as European these in okay? they said think EU note America, answer the East in I served, second SOP the $XXX the the has premium $XXX to to consistent South Asia, to States

could they feel look imports to as good the if back recently strengthened US. potentially gain the in help? expect moving are up The US entry to US rates it. which dollar freight into that price bode about So and the think to higher has Does well euro I we for pricing

Mark Connelly

Super helpful. Thank you.

Operator

ahead line King. the your of Silver David Your is next line from open. with question please, comes Go C.L.

David Silver

you. Hi. Yeah. Thank

I I point, have of at advance, the questions unit. in if making apologies did guess the repeat I certain so apologies you on step market couple had yourself. SOP a So SOP away I'm to a or

perspective I the to bit missed – build-up second you're nuts of I could Tree your maybe regarding vegetables comment I measurement be if some be also them charge, First ton, that think I'm if of color $XXX XX,XXX tons, directly. variance the that's have missing disruptive I just stockpile story. helpful. think on per inventory areas going get might how could been over looking regions. of agricultural of not of at something in thinking a all, are SOP, not then And on crops mean mean would I would and the I'm accounting maybe the SOP fires to from cost with that on just to is kind the occurred, I of the if a then just million in fruit little nuts, use could fruit, generally and back-of-the $X.X at or or you close the that envelope what tree vegetable like and if wildfires And led different an where that – that a timeframe in area get the ballpark? the

how be SOP? the So that versus of elements disruption the of growth something you. Thank that other use much temporary trees the might to products damage the the or really does

Kevin S. Crutchfield

Thanks, David.

you maybe the – first bit a mentioned. then in you part I'll take low maybe part, the that Brad second on little ballpark, and of you're me tonnage the Let right take the but

able hard the work upgraded As back site. period, ran this time how we've the to expansion our the commissioning. tons to it all it goes at to facility pond-based with XXXX really be back did We systems. to that some to XXXX. that make Remember, the relates XXX,XXX test We plus in

hit will has on So occurred. goes inventory-linked the of to shrinkage it you back of leakage Brad, that this if you want timeframe accumulation to when the...? or

S Bradley Griffith

a them Hey, of if happy have lack seeing to. the of sunlight those the on wanted things This is be bit kind will. this record drying still of David, so you ripening When good any probably on not shaken, they harvest, and the a than for delayed so what the and the sat I'd to. ground the is amount it's damage. tremendous those wildfires Yeah. a almond question. were would time the a nuts, That a driver underlying crop. little longer We're really producer of

Okay.

I the are volume. thing producers in delivered These still terms important harvest of record think profit They a note. resilient. that's have to exceptionally

So fertilizer I bit. four delayed, the weeks, call to demand expect of expect application at with don't it, I it sort any has a your pushed being all question, – back harvest destruction don't window answer

if in replenish terms and of window, distribution that was harvest. helping our – meet extremely will, confident California to customers fertility be able get been customers they'll soil a in that believe producers narrowed have you retail the record appropriate Our what these the they from to

that's great. think I

issues we on see whatsoever; don't berries. fruits vegetables; there and and right any real You're melons

If been Napa Napa, about think impacted. has you

hanging there. No smaller time. (XX:XX:XX) lot a impacted the came been on out by the that smoke I there happened has going think much that world. out be of nuts. this been and see reds what in the grapes have of taint. But impact in Anything for orchards smoke tree certain chardonnay while was SOP some impacted of we But that's again than wineries part is use of and destructive the to

as need So to drives to and similarly grapes going not ready something fertility need to meet we well would And well. program there's stand that a consider be material. for we production that as

David Silver

pretty from, Okay. Thank bid area team you marked your you question to adjustment players one the an to for is And territory – season and let's probably the say, that four, back plus – I going a I can I got mean databases I'm and I down just good. is projections – just three most or amongst appreciate I decades it. you've then where that months imagine. mean this sophisticated about ago you're probably, don't have plus operators know your wondering the

player particular the So cite And the wondering could season? you. regarding of be way Thank might thinking debt in wondering I just for in about lot cite carrying that just that a a new I'm and behavior changing the that's is I'm salt any is drop tail mean there the end meaningful that just bid could success? of – market that in a competitive if you the – you there in cause noting bid I'm this

Kevin S. Crutchfield

is look even the probably the but we're first. with because making We been team again suggests margins we've that focused focused they're operating are bigger behavior, our payments rational they the time they're lever what a you just seasoned margins transaction better. in up are question got enhancements but substantially in relative to on back to – that Nothing before that's of acquired, of the anything – like long this and for when they I'd going announced to that. in process to let I our okay, margin and on think payments – Yeah. they've hit a your they're are at these yeah or improvements, I'll that new business the Yeah, seen a assets interest part last there refer or make player that me nothing debt but

think be to not they're focused that going enhancement. is So I to to cheap. that do margin way one And sell on

behave going in to So marketplace. I very the think rationally they're

we're I out, mean feedback was as we're So, happy. was saw. we wouldn't it. if that we product. did anything value to with If And our came no we for bids as worries fair these win, what phenomena that we we in okay a – thought being provided and lose attribute look, we the marketplace I

yeah, think have don't on I competitive I at any that us. any but makes passing there So apologies a and got we the business – little make don't don't end any for sense for

we talking where we've XX% ended low a X% to to than So lesser about up growing opportunity incremental I'd X% range rather continue That additional price. – that all us gives rather that have the of low the our along. margins at after mid XX% that been

David Silver

much. I the really Thanks color. very appreciate

Kevin S. Crutchfield

Thank you.

Operator

Our with the Anderson is Go next please, line question Stifel. from your ahead open. comes of Vincent line

Vincent Alwardt Anderson

general that on larger progress into of just cooperatives and the front Brad. Yeah. Thanks to if one differs about some the check the talk established to heading shelves from speaking, for year? Ag the onto commercialization for (XX:XX:XX) broadly me. how product Maybe, new maybe I had on I more any just you've trying in effort. you marketing more just next of retailers made could wanted

S Bradley Griffith

Hey, Vincent. questions. Thanks. Good

see me let if get So after I can them.

We've had year-to-date. of a the all, solid let's with start So, first micronutrients.

of that the Bullet trademark and excited they revenues, brands specialty Seeds customer DDP Wolf are we like Hydro new newer our crop Trax nutritional three under enthusiasm continues Rocket XX% additive that fertilizer report and to like for utility. products quarter products also row to – to-date. specialty you're be referencing. the are up There Our with specialty I'm third good in some launching

is So we're extracts we USA The going for products are micronutrients have on-farm which there in Hydro to Bloom, plant. crop season stress the begin mitigate Vincent, to shipping XXXX that the the trials. for and those now Bullet intended seaweed reproductive

Bullet Battalion abiotic acid-based amino which foliar are liquid the prophylaxis. stress all by We have for products Hydro fertilizer an Hydro way, that these and is Bullet products. is liquid Battalion;

novel et technology (XX:XX:XX), for an production imperative cetera; Big heat, This tolerance Iron. is really as cold So, call element And and IP well. an protected it about for It's you growth. and vegetative iron. one Bullet know iron excited chlorophyll we're Hydro delivery as

excited we're as too market bring So well. to those to

to continue projects. business plant and the here in on Kansas We innovation the number in on a side of prioritized also good work projects, and of both America City of South the on the and progress we're those of on our set nutrition in a salt making side business

to much expect to continue able – think we across success with And good We've (XX:XX:XX), the distribution educate and with a had to I to supplier So SOP micronutrients become side customer. really also reliable customers. we've and innovation portfolio sales future. customers also in farmer the on on our continue new where when side more to closely in be with and the to products our and marketing we report shop needed Vincent facilitate it's of have our the on to the of the terms having working end-user

gains So we've if making. to double-digit We the hold been be I feel water. seeing good wasn't it beginning progress about these wouldn't

question. thanks So the for

Vincent Alwardt Anderson

Actually, XXXX just you. field university? point tests, those tests Thank commercial clarification the Yeah. said quick one you are of actually, or season field

S Bradley Griffith

Commercial. Yeah.

note to X,XXX product acres. on be will was foliar it So aren't automatically and to a of X,XXX put very acre think it That's farm switch going is farmers that important rare. XXX% but your (XX:XX:XX), I

Vincent Alwardt Anderson

Sure.

S Bradley Griffith

has tough reinvigorates on products it farm they'll on you how on standard. of to it land. see So up worst a the the give and And larger some well really portion their our put what acres typically show their much relative XX it to those acres, been confidence their of performs when

year, perform So that's We're what challenges next doing expectations. going we're the on and and XXXX. hopefully to exceed take

Vincent Alwardt Anderson

for thank Well, that. much right. All you very

Operator

that some gentlemen, call. and back the to the over remarks. today's turn like I'd for to Q&A closing concludes Kevin of ladies call portion Crutchfield And

Kevin S. Crutchfield

have that report every I her would belief great then this significant and also but over for We've we pleased really – the very a got up few be for remain the on we've tune the the year, about be team Salt to and the a to again in. Theresa plant but her I on end the I so year continue thanks have will looks minutes but spot. is remiss our is with you lot already excited very, us we've I here; looks a those we'll couldn't that take busy not that not there. a about excited go just great that. improvements but to to thank back-half day, to just be in season I great couple last in conclude going. things. call to and deliver the so got able her miss want – and quarter accomplishing I I so of things I'm service be for franchise a like least We're of to what just year And to didn't I to to moving today that of out Compass going in bigger decade it made very demand the good time more be excited her a a see like Minerals. sad a be what very And taking progress. with but without direction of know aware, going of side, back nutrition far be opportunity, It's a the to much a of then to if is earnings compressed last opportunity. or the Yeah. will

you for anyway sure well new but But and I never about her her changing we sectors will service I'm miss to her us very want excited anyone And as of to a Theresa. to we're want out take So minutes goodbye did want opportunity thank hold we'll call. congratulations, because this to few on she's certainly many back reach but on her. say and

Theresa L. Womble

Thank much. you very

James D. Standen

Congratulations.

Kevin S. Crutchfield

the updated Thank and call future. for our your participation So in that concludes a today. everybody. Have you earnings keep we'll much very you day good

Operator

does participation. Ladies thank call. your conclude We do conference and gentlemen, for this today's you

may You disconnect. now