Intrepid Potash, Inc. ("Intrepid", the "Company", "we", "us",
"our") (NYSE:IPI) today reported its results for the second quarter
of 2023.
Key Highlights for Second Quarter 2023
Financial & Operational
- Total sales of $81.0 million, which compares to $91.7 million
in the second quarter of 2022, as potash and Trio® average net
realized sales prices(1) decreased to $479 and $333 per ton,
respectively.
- Net income of $4.3 million (or $0.33 per diluted share), which
compares to $23.7 million (or $1.74 per diluted share) in the
second quarter of 2022.
- Gross margin of $15.4 million, which compares to $41.8 million
in the second quarter of 2022.
- Cash flow from operations of $30.5 million, which compares
to $49.1 million in the second quarter of 2022.
- Adjusted EBITDA(1) of $15.8 million, which compares to $41.5
million in the second quarter of 2022.
- Potash and Trio® sales volumes of 79 thousand and 63 thousand
tons, respectively, which compares to prior-year figures of 56
thousand and 59 thousand, respectively.
Capital Expenditures
- Incurred capital expenditures of $20.9 million in the second
quarter of 2023. We expect full-year 2023 capital expenditures to
be between $65 and $75 million.
- Our capital expenditures reflect our direct investments in our
potash assets, which will help us meet our goals of maximizing
brine availability and underground brine residence time. These
investments are expected to drive higher and more consistent potash
production.
HB Solar Solution Mine in Carlsbad, New
Mexico
- Phase One of HB Injection Pipeline Project: Installation of the
new injection pipeline was successfully completed. The new pipeline
is designed to increase our brine injection rates significantly
above the rates achieved over the past five years. We anticipate
operating at average injection rates of approximately 1,100 gallons
per minute, which is approximately 55% higher than our injection
rates prior to starting the project.
- Phase Two of HB Injection Pipeline Project: Phase Two is the
installation of an in-line pigging system to clean the pipeline and
remove scaling to help ensure more consistent flow rates. We
continue to work through the permitting requirements and anticipate
construction beginning by the end of 2023, with commissioning
expected in the first quarter of 2024.
- Eddy Shaft: This project is designed to target
already-measured, high-grade brine from an existing mine shaft in
the HB cavern system. Key permitting is complete, construction is
underway, and we expect the project to be commissioned in the
fourth quarter of 2023.
- Replacement Extraction Well: After the failed extraction well
in the fourth quarter of 2022, our plans to drill a newly designed
extraction well to replace the IP-30 well are underway, and we have
begun the permitting and contracting processes. This new extraction
well is designed to have a long-term operational life and will
target known, high-grade brine from the HB cavern system.
Solar Solution Mine in Moab, Utah
- Well 45 and Well 46: We successfully drilled Well 45 (Cavern 4)
and Well 46 and commissioned both projects in July 2023. Both
projects will help us deliver on our key goals of maximizing brine
availability and underground brine residence time, which is
expected to drive higher and more consistent production.
East Facility in Carlsbad, New Mexico
- The first of two new continuous miners was commissioned during
the second quarter and we are already seeing higher efficiencies
and production in our underground mining operations. The second
continuous miner was recently delivered and is expected to be
operating in the third quarter of 2023.
Sand Resources at Intrepid South
- We recently secured the necessary permits for construction,
which we expect to start in the fourth quarter of 2023. We continue
to target annualized production of approximately one million tons
of wet sand which is contingent on receiving an additional air
quality permit that would allow us to operate the plant outside
daylight hours. If receipt of the additional air quality permit is
delayed we plan to operate the plant at reduced rates until
permitting is complete.
Liquidity
- As of July 31, 2023, Intrepid had approximately $15.6 million
in cash and cash equivalents and $150 million available under its
revolving credit facility, for total liquidity of approximately
$165.6 million.
- Intrepid maintains an investment account of short-and-long-term
fixed income securities that had a balance of approximately $5.8
million as of July 31, 2023.
Consolidated Results, Management Commentary, &
OutlookIntrepid generated second quarter 2023 sales of
$81.0 million, a 12% decrease from second quarter 2022 sales of
$91.7 million. Consolidated gross margin in the second quarter of
2023 totaled $15.4 million, while net income totaled $4.3
million, or $0.33 per diluted share, which compares to second
quarter 2022 net income of $23.7 million, or $1.74 per diluted
share. The Company delivered adjusted EBITDA of $15.8 million in
the second quarter of 2023, down from $41.5 million in the same
prior year period, with the lower profitability primarily being
driven by lower pricing for our key products, as well as an
increase in our cost of goods sold. Our net realized sales price
for Potash and Trio® averaged $479 and $333 per ton, respectively,
in the second quarter of 2023, which compares to $738 and $493 per
ton, respectively, in the second quarter of 2022.
Bob Jornayvaz, Intrepid's Executive Chairman and CEO commented:
"Our key focus over the last year has been successful project
execution, with our growth capital primarily directed to our potash
assets to maximize brine availability and residence time
underground to improve our brine grade. As we shared in recent
press releases, we successfully executed on three of our key growth
projects and are already seeing improvements in our injection
rates, with production benefits expected next year.
In the second quarter, we delivered strong results, highlighted
by potash sales volumes of 79 thousand tons, which represents an
approximately 40% increase compared to the second quarter of 2022.
Fertilizer pricing continues to drive strong margins for the
Company, and our expectation of robust demand underpinned by solid
farmer economics was evident in our improved sales volumes in the
first half of this year.
Looking ahead, the key theme of agricultural markets enjoying a
positive backdrop is still underway, with several key crop futures
recently reversing some weakness and again showing strength,
particularly when compared to historical levels. For the back half
of the year, we believe the combination of supportive crop futures
prices and attractive fertilizer pricing will support a strong fall
application season in the U.S., with the most recent catalyst being
a positive market response to the announcement of a July fill
program."
Segment Highlights
Potash
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
(in thousands, except per ton data) |
Sales |
|
$ |
47,264 |
|
$ |
48,827 |
|
$ |
99,761 |
|
$ |
105,269 |
Gross margin |
|
$ |
12,876 |
|
$ |
24,925 |
|
$ |
27,304 |
|
$ |
53,990 |
|
|
|
|
|
|
|
|
|
Potash sales volumes (in
tons) |
|
|
79 |
|
|
56 |
|
|
167 |
|
|
126 |
Potash production volumes (in
tons) |
|
|
12 |
|
|
25 |
|
|
102 |
|
|
128 |
|
|
|
|
|
|
|
|
|
Average potash net realized
sales price per ton(1) |
|
$ |
479 |
|
$ |
738 |
|
$ |
485 |
|
$ |
713 |
Potash segment sales in the second quarter of 2023 decreased 3%
to $47.3 million when compared to the same period in 2022. The
lower revenue was driven by a 35% decrease in our average net
realized sales price per ton to $479, which compares to $738 per
ton in the same prior year period. The lower average net realized
sales price per ton in the second quarter of 2023 was partially
offset by higher potash sales volumes, which totaled 79 thousand
tons, a 41% increase compared to the second quarter of 2022. For
the first six months ended June 30, 2023, our potash segment sales
decreased 5% to $99.8 million, with our higher sales volumes of 167
thousand tons offsetting a 32% decrease in our average net realized
price to $485 per ton.
For the second quarter of 2023, potash segment gross margin
totaled $12.9 million, which compares to $24.9 million in the
second quarter of 2022, and for the first six months ended June 30,
2023, Potash segment gross margin totaled $27.3 million, which
compares to $54.0 million in the prior year period. The lower gross
margin figures were driven by an increase in segment cost of goods
sold - which was due to higher sales volumes and an increase in our
weighted average carrying cost per ton - as well as lower potash
pricing in the first half of 2023 compared to the first half of
2022.
Potash production totaled 12 thousand tons in the second quarter
of 2023, which compares to 25 thousand tons produced in the same
prior year period, while potash production for the first six months
ended June 30, 2023 totaled 102 thousand tons, a decrease from 128
thousand tons in the same prior year period.
Trio®
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
(in thousands, except per ton data) |
Sales |
|
$ |
28,748 |
|
$ |
35,467 |
|
$ |
59,022 |
|
$ |
76,519 |
Gross margin |
|
$ |
1,222 |
|
$ |
13,052 |
|
$ |
2,674 |
|
$ |
29,191 |
|
|
|
|
|
|
|
|
|
Trio® sales volume (in
tons) |
|
|
63 |
|
|
59 |
|
|
128 |
|
|
131 |
Trio® production volume (in
tons) |
|
|
58 |
|
|
58 |
|
|
107 |
|
|
123 |
|
|
|
|
|
|
|
|
|
Average Trio® net realized
sales price per ton(1) |
|
$ |
333 |
|
$ |
493 |
|
$ |
339 |
|
$ |
476 |
Trio® segment sales of $28.7 million for the second quarter of
2023 were 19% lower compared to the same prior year period. This
was primarily driven by a lower average net realized sales price
per ton of $333, a decrease of 32% compared to the second quarter
of 2022, although this was partially offset by Trio® sales volumes
increasing by 7% to 63 thousand tons. For the first six months
ended June 30, 2023, our Trio® segment sales decreased 23% to $59.0
million, which was driven by a 29% decrease in our average net
realized price to $339 per ton, while our sales volumes were down
2% to 128 thousand tons.
For the second quarter of 2023, Trio® segment gross margin
totaled $1.2 million, which compares to $13.1 million in the second
quarter of 2022, and for the first six months ended June 30, 2023,
Trio® segment gross margin totaled $2.7 million, which compares to
$29.2 million in the same prior year period. The lower gross margin
figures were primarily driven by an increase in segment cost of
goods sold and lower pricing in the first half of 2023 compared to
the first half of 2022.
Trio® production totaled 58 thousand tons in the second quarter
of 2023 which was the same as the second quarter of 2022, while
Trio® production for the first six months ended June 30, 2023
totaled 107 thousand tons, a decrease from 123 thousand tons in the
same prior year period. During the first quarter of 2023, our East
Facility experienced net unplanned downtime of approximately eight
days which was the primary reason for the lower production in the
first half of this year.
Oilfield Solutions
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
(in thousands) |
Sales |
|
$ |
5,111 |
|
$ |
7,512 |
|
$ |
9,361 |
|
$ |
14,512 |
Gross margin |
|
$ |
1,284 |
|
$ |
3,834 |
|
$ |
1,756 |
|
$ |
5,806 |
Our Oilfield Solutions segment sales decreased $2.4 million, or
32%, in the second quarter of 2023 compared to the second quarter
of 2022, which was primarily driven by a $1.1 million decrease in
water sales and a $1.5 million decrease in surface use,
rights-of-way and easement revenues. While oil and gas activities
near our Intrepid South property remained strong during the second
quarter of 2023, we entered into fewer surface use agreements and
our water sales decreased owing to the timing of fracs compared to
the same prior year period.
Our cost of goods sold decreased $0.1 million, or 4%, for the
second quarter of 2023 compared to the same period in 2022.
However, the lower segment sales more than offset the decrease in
cost of goods sold, and our Oilfield Solutions segment gross margin
experienced a decrease of $2.6 million in the second quarter of
2023.
LiquidityDuring the second quarter of 2023,
cash flow from operations was $30.5 million, while cash used in
investing activities was $18.3 million. As of July 31, 2023, we had
approximately $15.6 million in cash and cash equivalents, no
outstanding borrowings, and $150 million available to borrow under
our revolving credit facility, for total liquidity of approximately
$165.6 million.
Notes1 Adjusted net income, adjusted net income
per diluted share, adjusted earnings before interest, taxes,
depreciation, and amortization (or adjusted EBITDA) and average net
realized sales price per ton are non-GAAP financial measures. See
the non-GAAP reconciliations set forth later in this press release
for additional information.
Unless expressly stated otherwise or the context otherwise
requires, references to tons in this press release refer to short
tons. One short ton equals 2,000 pounds. One metric tonne, which
many international competitors use, equals 1,000 kilograms or
2,204.62 pounds.
Conference Call Information
Intrepid will host a conference call on Thursday, August 3, 2023,
at 12:00 p.m. Eastern Time to discuss the results and other
operating and financial matters and answer investor questions.
Management invites you to listen to the conference call by using
the toll-free dial-in number 1 (888) 210-4149 or toll-in dial-in 1
(646) 960-0145; please use conference ID 9158079. The call will
also be streamed on the Intrepid website, intrepidpotash.com. A
recording of the conference call will be available approximately
two hours after the completion of the call by dialing 1 (800)
770-2030 for toll-free, 1 (647) 362-9199 for toll-in, or at
intrepidpotash.com. The replay of the call will require the input
of the conference identification number 9158079. The recording will
be available through August 10, 2023.
About Intrepid
Intrepid is a diversified mineral company that delivers
potassium, magnesium, sulfur, salt, and water products essential
for customer success in agriculture, animal feed, and the oil and
gas industry. Intrepid is the only U.S. producer of muriate of
potash, which is applied as an essential nutrient for healthy crop
development, utilized in several industrial applications, and used
as an ingredient in animal feed. In addition, Intrepid produces a
specialty fertilizer, Trio®, which delivers three key nutrients,
potassium, magnesium, and sulfate, in a single particle. Intrepid
also provides water, magnesium chloride, brine, and various
oilfield products and services. Intrepid serves diverse customers
in markets where a logistical advantage exists and is a leader in
the use of solar evaporation for potash production, resulting in
lower cost and more environmentally friendly production. Intrepid's
mineral production comes from three solar solution potash
facilities and one conventional underground Trio® mine.
Intrepid routinely posts important information, including
information about upcoming investor presentations and press
releases, on its website under the Investor Relations tab.
Investors and other interested parties are encouraged to enroll at
intrepidpotash.com, to receive automatic email alerts for new
postings.
Forward-looking Statements
This document contains forward-looking statements - that is,
statements about future, not past, events. The forward-looking
statements in this document relate to, among other things,
statements about Intrepid's future financial performance, cash flow
from operations expectations, water sales, production costs,
acquisition expectations and operating plans, and its market
outlook. These statements are based on assumptions that Intrepid
believes are reasonable. Forward-looking statements by their nature
address matters that are uncertain. The particular uncertainties
that could cause Intrepid's actual results to be materially
different from its forward-looking statements include the
following:
- changes in the price, demand, or supply of our products and
services;
- challenges and legal proceedings
related to our water rights;
- our ability to successfully identify
and implement any opportunities to grow our business whether
through expanded sales of water, Trio®, byproducts, and other
non-potassium related products or other revenue diversification
activities;
- the costs of, and our ability to
successfully execute, any strategic projects;
- declines or changes in agricultural
production or fertilizer application rates;
- declines in the use of
potassium-related products or water by oil and gas companies in
their drilling operations;
- our ability to prevail in
outstanding legal proceedings against us;
- our ability to comply with the terms
of our revolving credit facility, including the underlying
covenants;
- further write-downs of the carrying
value of assets, including inventories;
- circumstances that disrupt or limit
production, including operational difficulties or variances,
geological or geotechnical variances, equipment failures,
environmental hazards, and other unexpected events or
problems;
- changes in reserve estimates;
- currency fluctuations;
- adverse changes in economic
conditions or credit markets;
- the impact of governmental
regulations, including environmental and mining regulations, the
enforcement of those regulations, and governmental policy
changes;
- adverse weather events, including
events affecting precipitation and evaporation rates at our solar
solution mines;
- increased labor costs or
difficulties in hiring and retaining qualified employees and
contractors, including workers with mining, mineral processing, or
construction expertise;
- changes in the prices of raw
materials, including chemicals, natural gas, and power;
- our ability to obtain and maintain
any necessary governmental permits or leases relating to current or
future operations;
- interruptions in rail or truck
transportation services, or fluctuations in the costs of these
services;
- our inability to fund necessary
capital investments;
- global inflationary pressures and
supply chain challenges;
- the impact of global health issues,
such as the COVID-19 pandemic, and other global disruptions on our
business, operations, liquidity, financial condition and results of
operations; and
- the other risks, uncertainties, and
assumptions described in Item 1A. Risk Factors of our Annual Report
on Form 10-K for the year ended December 31, 2022.
In addition, new risks emerge from time to time. It is not
possible for Intrepid to predict all risks that may cause actual
results to differ materially from those contained in any
forward-looking statements Intrepid may make. All information in
this document speaks as of the date of this release. New
information or events after that date may cause our forward-looking
statements in this document to change. We undertake no obligation
to update or revise publicly any forward-looking statements to
conform the statements to actual results or to reflect new
information or future events.
Contact:Evan Mapes, CFA, Investor Relations
Manager Phone: 303-996-3042Email: evan.mapes@intrepidpotash.com
INTREPID POTASH,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (UNAUDITED)FOR THE THREE AND SIX MONTHS
ENDED JUNE 30, 2023 AND 2022 (In thousands, except
per share amounts)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Sales |
|
$ |
81,035 |
|
|
$ |
91,740 |
|
|
$ |
167,955 |
|
|
$ |
196,139 |
|
Less: |
|
|
|
|
|
|
|
|
Freight costs |
|
|
10,516 |
|
|
|
9,227 |
|
|
|
22,106 |
|
|
|
19,464 |
|
Warehousing and handling costs |
|
|
2,801 |
|
|
|
2,204 |
|
|
|
5,534 |
|
|
|
4,680 |
|
Cost of goods sold |
|
|
52,336 |
|
|
|
38,498 |
|
|
|
108,581 |
|
|
|
83,008 |
|
Gross
Margin |
|
|
15,382 |
|
|
|
41,811 |
|
|
|
31,734 |
|
|
|
88,987 |
|
|
|
|
|
|
|
|
|
|
Selling and
administrative |
|
|
7,948 |
|
|
|
7,218 |
|
|
|
16,806 |
|
|
|
14,007 |
|
Accretion of asset retirement
obligation |
|
|
535 |
|
|
|
490 |
|
|
|
1,070 |
|
|
|
980 |
|
(Gain) loss on sale of
assets |
|
|
(7 |
) |
|
|
1,066 |
|
|
|
193 |
|
|
|
1,166 |
|
Other operating (income)
expense |
|
|
(362 |
) |
|
|
1,242 |
|
|
|
1,023 |
|
|
|
975 |
|
Operating
Income |
|
|
7,268 |
|
|
|
31,795 |
|
|
|
12,642 |
|
|
|
71,859 |
|
|
|
|
|
|
|
|
|
|
Other Income
(Expense) |
|
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated entities |
|
|
(1,059 |
) |
|
|
— |
|
|
|
(238 |
) |
|
|
— |
|
Interest expense, net |
|
|
— |
|
|
|
(24 |
) |
|
|
— |
|
|
|
(57 |
) |
Interest income |
|
|
76 |
|
|
|
15 |
|
|
|
161 |
|
|
|
17 |
|
Other income |
|
|
43 |
|
|
|
11 |
|
|
|
56 |
|
|
|
539 |
|
Income Before Income
Taxes |
|
|
6,328 |
|
|
|
31,797 |
|
|
|
12,621 |
|
|
|
72,358 |
|
|
|
|
|
|
|
|
|
|
Income Tax
Expense |
|
|
(2,023 |
) |
|
|
(8,089 |
) |
|
|
(3,810 |
) |
|
|
(17,228 |
) |
Net
Income |
|
$ |
4,305 |
|
|
$ |
23,708 |
|
|
$ |
8,811 |
|
|
$ |
55,130 |
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares
Outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
12,766 |
|
|
|
13,246 |
|
|
|
12,730 |
|
|
|
13,203 |
|
Diluted |
|
|
12,855 |
|
|
|
13,620 |
|
|
|
12,865 |
|
|
|
13,690 |
|
Earnings Per Share: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.34 |
|
|
$ |
1.79 |
|
|
$ |
0.69 |
|
|
$ |
4.18 |
|
Diluted |
|
$ |
0.33 |
|
|
$ |
1.74 |
|
|
$ |
0.68 |
|
|
$ |
4.03 |
|
INTREPID POTASH,
INC.CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)AS OF JUNE 30, 2023 AND DECEMBER 31,
2022(In thousands, except share
and per share amounts)
|
|
June 30, |
|
December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
ASSETS |
|
|
|
|
Cash and cash equivalents |
|
$ |
17,158 |
|
|
$ |
18,514 |
|
Short-term investments |
|
|
3,462 |
|
|
|
5,959 |
|
Accounts receivable: |
|
|
|
|
Trade, net |
|
|
23,819 |
|
|
|
26,737 |
|
Other receivables, net |
|
|
1,690 |
|
|
|
790 |
|
Inventory, net |
|
|
103,966 |
|
|
|
114,816 |
|
Prepaid expenses and other
current assets |
|
|
3,741 |
|
|
|
4,863 |
|
Total current assets |
|
|
153,836 |
|
|
|
171,679 |
|
|
|
|
|
|
Property, plant, equipment,
and mineral properties, net |
|
|
400,627 |
|
|
|
375,630 |
|
Water rights |
|
|
19,184 |
|
|
|
19,184 |
|
Long-term parts inventory,
net |
|
|
24,911 |
|
|
|
24,823 |
|
Long-term investments |
|
|
8,614 |
|
|
|
9,841 |
|
Other assets, net |
|
|
7,018 |
|
|
|
7,294 |
|
Non-current deferred tax
asset, net |
|
|
182,076 |
|
|
|
185,752 |
|
Total
Assets |
|
$ |
796,266 |
|
|
$ |
794,203 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
12,117 |
|
|
$ |
18,645 |
|
Accrued liabilities |
|
|
14,388 |
|
|
|
16,212 |
|
Accrued employee compensation
and benefits |
|
|
5,921 |
|
|
|
6,975 |
|
Other current liabilities |
|
|
5,798 |
|
|
|
7,044 |
|
Total current liabilities |
|
|
38,224 |
|
|
|
48,876 |
|
|
|
|
|
|
Asset retirement obligation,
net of current portion |
|
|
27,634 |
|
|
|
26,564 |
|
Operating lease
liabilities |
|
|
1,451 |
|
|
|
2,206 |
|
Finance lease liabilities |
|
|
1,629 |
|
|
|
— |
|
Other non-current
liabilities |
|
|
1,227 |
|
|
|
1,479 |
|
Total
Liabilities |
|
|
70,165 |
|
|
|
79,125 |
|
|
|
|
|
|
Commitments and
Contingencies |
|
|
|
|
Common stock, $0.001 par
value; 40,000,000 shares authorized; |
|
|
|
|
12,789,326 and 12,687,822 shares outstanding |
|
|
|
|
at June 30, 2023, and December 31, 2022, respectively |
|
|
13 |
|
|
|
13 |
|
Additional paid-in
capital |
|
|
662,826 |
|
|
|
660,614 |
|
Retained earnings |
|
|
85,274 |
|
|
|
76,463 |
|
Less treasury stock, at
cost |
|
|
(22,012 |
) |
|
|
(22,012 |
) |
Total Stockholders'
Equity |
|
|
726,101 |
|
|
|
715,078 |
|
Total Liabilities
and Stockholders' Equity |
|
$ |
796,266 |
|
|
$ |
794,203 |
|
INTREPID POTASH,
INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (UNAUDITED)FOR THE THREE AND SIX MONTHS
ENDED JUNE 30, 2023 AND 2022(In
thousands)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Cash Flows from
Operating Activities: |
|
|
|
|
|
|
|
|
Net income |
|
$ |
4,305 |
|
|
$ |
23,708 |
|
|
$ |
8,811 |
|
|
$ |
55,130 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
Depreciation, depletion and amortization |
|
|
8,892 |
|
|
|
8,025 |
|
|
|
18,183 |
|
|
|
16,923 |
|
Accretion of asset retirement obligation |
|
|
535 |
|
|
|
490 |
|
|
|
1,070 |
|
|
|
980 |
|
Amortization of deferred financing costs |
|
|
75 |
|
|
|
60 |
|
|
|
151 |
|
|
|
120 |
|
Amortization of intangible assets |
|
|
80 |
|
|
|
81 |
|
|
|
161 |
|
|
|
161 |
|
Stock-based compensation |
|
|
1,803 |
|
|
|
1,391 |
|
|
|
3,549 |
|
|
|
2,558 |
|
(Gain) loss on disposal of assets |
|
|
(7 |
) |
|
|
1,066 |
|
|
|
193 |
|
|
|
1,166 |
|
Allowance for parts inventory obsolescence |
|
|
— |
|
|
|
1,600 |
|
|
|
— |
|
|
|
1,600 |
|
Equity in earnings of unconsolidated entities |
|
|
1,059 |
|
|
|
— |
|
|
|
238 |
|
|
|
— |
|
Distribution of earnings from unconsolidated entities |
|
|
132 |
|
|
|
— |
|
|
|
452 |
|
|
|
— |
|
Changes in operating assets
and liabilities: |
|
|
|
|
|
|
|
|
Trade accounts receivable, net |
|
|
15,391 |
|
|
|
18,969 |
|
|
|
2,917 |
|
|
|
2,770 |
|
Other receivables, net |
|
|
(867 |
) |
|
|
(262 |
) |
|
|
(959 |
) |
|
|
(646 |
) |
Inventory, net |
|
|
3,117 |
|
|
|
(3,606 |
) |
|
|
10,763 |
|
|
|
(2,759 |
) |
Prepaid expenses and other current assets |
|
|
656 |
|
|
|
749 |
|
|
|
906 |
|
|
|
673 |
|
Deferred tax assets, net |
|
|
2,016 |
|
|
|
7,941 |
|
|
|
3,676 |
|
|
|
16,941 |
|
Accounts payable, accrued liabilities, and accrued employee
compensation and benefits |
|
|
(2,827 |
) |
|
|
(10,550 |
) |
|
|
(8,132 |
) |
|
|
(11,412 |
) |
Operating lease liabilities |
|
|
(408 |
) |
|
|
(438 |
) |
|
|
(809 |
) |
|
|
(1,233 |
) |
Other liabilities |
|
|
(3,455 |
) |
|
|
(105 |
) |
|
|
(2,222 |
) |
|
|
257 |
|
Net cash provided by operating activities |
|
|
30,497 |
|
|
|
49,119 |
|
|
|
38,948 |
|
|
|
83,229 |
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Investing Activities: |
|
|
|
|
|
|
|
|
Additions to property, plant, equipment, mineral properties and
other assets |
|
|
(20,895 |
) |
|
|
(15,979 |
) |
|
|
(41,934 |
) |
|
|
(22,774 |
) |
Purchase of investments |
|
|
(459 |
) |
|
|
(9,996 |
) |
|
|
(1,415 |
) |
|
|
(10,899 |
) |
Proceeds from sale of assets |
|
|
24 |
|
|
|
22 |
|
|
|
89 |
|
|
|
46 |
|
Proceeds from redemptions/maturities of investments |
|
|
2,500 |
|
|
|
— |
|
|
|
4,000 |
|
|
|
— |
|
Other investing, net |
|
|
508 |
|
|
|
— |
|
|
|
508 |
|
|
|
— |
|
Net cash used in investing activities |
|
|
(18,322 |
) |
|
|
(25,953 |
) |
|
|
(38,752 |
) |
|
|
(33,627 |
) |
|
|
|
|
|
|
|
|
|
Cash Flows from
Financing Activities: |
|
|
|
|
|
|
|
|
Payments of financing lease |
|
|
(167 |
) |
|
|
— |
|
|
|
(210 |
) |
|
|
— |
|
Proceeds from short-term borrowings on credit facility |
|
|
— |
|
|
|
— |
|
|
|
5,000 |
|
|
|
— |
|
Repayments of short-term borrowings on credit facility |
|
|
(5,000 |
) |
|
|
— |
|
|
|
(5,000 |
) |
|
|
— |
|
Employee tax withholding paid for restricted stock upon
vesting |
|
|
(298 |
) |
|
|
(1,548 |
) |
|
|
(1,337 |
) |
|
|
(4,362 |
) |
Proceeds from exercise of stock options |
|
|
— |
|
|
|
20 |
|
|
|
— |
|
|
|
110 |
|
Net cash used in financing activities |
|
|
(5,465 |
) |
|
|
(1,528 |
) |
|
|
(1,547 |
) |
|
|
(4,252 |
) |
|
|
|
|
|
|
|
|
|
Net Change in Cash,
Cash Equivalents and Restricted Cash |
|
|
6,710 |
|
|
|
21,638 |
|
|
|
(1,351 |
) |
|
|
45,350 |
|
Cash, Cash
Equivalents and Restricted Cash, beginning of
period |
|
|
11,023 |
|
|
|
60,858 |
|
|
|
19,084 |
|
|
|
37,146 |
|
Cash, Cash Equivalents
and Restricted Cash, end of period |
|
$ |
17,733 |
|
|
$ |
82,496 |
|
|
$ |
17,733 |
|
|
$ |
82,496 |
|
To supplement Intrepid's consolidated financial statements,
which are prepared and presented in accordance with GAAP, Intrepid
uses several non-GAAP financial measures to monitor and evaluate
its performance. These non-GAAP financial measures include adjusted
net income, adjusted net income per diluted share, adjusted EBITDA,
and average net realized sales price per ton. These non-GAAP
financial measures should not be considered in isolation, or as a
substitute for, or superior to, the financial information prepared
and presented in accordance with GAAP. In addition, because the
presentation of these non-GAAP financial measures varies among
companies, these non-GAAP financial measures may not be comparable
to similarly titled measures used by other companies.
Intrepid believes these non-GAAP financial measures provide
useful information to investors for analysis of its business.
Intrepid uses these non-GAAP financial measures as one of its tools
in comparing period-over-period performance on a consistent basis
and when planning, forecasting, and analyzing future periods.
Intrepid believes these non-GAAP financial measures are used by
professional research analysts and others in the valuation,
comparison, and investment recommendations of companies in the
potash mining industry. Many investors use the published research
reports of these professional research analysts and others in
making investment decisions.
Adjusted Net Income and Adjusted Net Income Per Diluted
Share
Adjusted net income and adjusted net income per diluted share
are calculated as net income or income per diluted share adjusted
for certain items that impact the comparability of results from
period to period, as set forth in the reconciliation below.
Intrepid considers these non-GAAP financial measures to be useful
because they allow for period-to-period comparisons of its
operating results excluding items that Intrepid believes are not
indicative of its fundamental ongoing operations.
Reconciliation of Net Income to Adjusted Net Income:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
(in thousands) |
Net Income |
$ |
4,305 |
|
|
$ |
23,708 |
|
|
$ |
8,811 |
|
|
$ |
55,130 |
|
Adjustments |
|
|
|
|
|
|
|
(Gain) loss on sale of
assets |
|
(7 |
) |
|
|
1,066 |
|
|
|
193 |
|
|
|
1,166 |
|
Calculated income tax
effect(1) |
|
2 |
|
|
|
(277 |
) |
|
|
(50 |
) |
|
|
(303 |
) |
Total adjustments |
|
(5 |
) |
|
|
789 |
|
|
|
143 |
|
|
|
863 |
|
Adjusted Net Income |
$ |
4,300 |
|
|
$ |
24,497 |
|
|
$ |
8,954 |
|
|
$ |
55,993 |
|
Reconciliation of Net Income per Share to Adjusted Net Income
per Share:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
2022 |
|
Net Income Per Diluted
Share |
$ |
0.33 |
|
$ |
1.74 |
|
|
$ |
0.68 |
|
$ |
4.03 |
|
Adjustments |
|
|
|
|
|
|
|
Loss on sale of assets |
|
— |
|
|
0.08 |
|
|
|
0.02 |
|
|
0.09 |
|
Calculated income tax
effect(1) |
|
— |
|
|
(0.02 |
) |
|
|
— |
|
|
(0.02 |
) |
Total adjustments |
|
— |
|
|
0.06 |
|
|
|
0.02 |
|
|
0.07 |
|
Adjusted Net Income Per
Diluted Share |
$ |
0.33 |
|
$ |
1.80 |
|
|
$ |
0.70 |
|
$ |
4.10 |
|
(1) Assumes an annual effective tax rate of 26%
for 2023 and 2022.
Adjusted EBITDA
Adjusted earnings before interest, taxes, depreciation, and
amortization (or adjusted EBITDA) is calculated as net income
adjusted for certain items that impact the comparability of results
from period to period, as set forth in the reconciliation below.
Intrepid considers adjusted EBITDA to be useful, and believe it to
be useful for investors, because the measure reflects Intrepid's
operating performance before the effects of certain non-cash items
and other items that Intrepid believes are not indicative of its
core operations. Intrepid uses adjusted EBITDA to assess operating
performance.
Reconciliation of Net Income to Adjusted EBITDA:
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
(in thousands) |
Net Income |
|
$ |
4,305 |
|
|
$ |
23,708 |
|
$ |
8,811 |
|
$ |
55,130 |
(Gain) loss on sale of
assets |
|
|
(7 |
) |
|
|
1,066 |
|
|
193 |
|
|
1,166 |
Interest expense |
|
|
— |
|
|
|
24 |
|
|
— |
|
|
57 |
Income tax expense |
|
|
2,023 |
|
|
|
8,089 |
|
|
3,810 |
|
|
17,228 |
Depreciation, depletion, and
amortization |
|
|
8,892 |
|
|
|
8,025 |
|
|
18,183 |
|
|
16,923 |
Amortization of intangible
assets |
|
|
80 |
|
|
|
81 |
|
|
161 |
|
|
161 |
Accretion of asset retirement
obligation |
|
|
535 |
|
|
|
490 |
|
|
1,070 |
|
|
980 |
Total adjustments |
|
|
11,523 |
|
|
|
17,775 |
|
|
23,417 |
|
|
36,515 |
Adjusted EBITDA |
|
$ |
15,828 |
|
|
$ |
41,483 |
|
$ |
32,228 |
|
$ |
91,645 |
Average Potash and Trio®
Net Realized Sales Price per Ton
Average net realized sales price per ton for potash is
calculated as potash segment sales less potash segment byproduct
sales and potash freight costs and then dividing that difference by
the number of tons of potash sold in the period. Likewise, average
net realized sales price per ton for Trio® is calculated as Trio®
segment sales less Trio® segment byproduct sales and Trio® freight
costs and then dividing that difference by Trio® tons sold.
Intrepid considers average net realized sales price per ton to be
useful, and believe it to be useful for investors, because it shows
Intrepid's potash and Trio® average per ton pricing without the
effect of certain transportation and delivery costs. When Intrepid
arranges transportation and delivery for a customer, it includes in
revenue and in freight costs the costs associated with
transportation and delivery. However, some of Intrepid's customers
arrange for and pay their own transportation and delivery costs, in
which case these costs are not included in Intrepid's revenue and
freight costs. Intrepid uses average net realized sales price per
ton as a key performance indicator to analyze potash and Trio®
sales and price trends.
Reconciliation of Sales to Average Net Realized Sales Price per
Ton:
|
|
Three Months Ended June 30, |
|
|
|
2023 |
|
|
2022 |
(in thousands, except per ton
amounts) |
|
Potash |
|
Trio® |
|
Potash |
|
Trio® |
Total Segment Sales |
|
$ |
47,264 |
|
$ |
28,748 |
|
$ |
48,827 |
|
$ |
35,467 |
Less: Segment byproduct
sales |
|
|
6,158 |
|
|
1,520 |
|
|
4,942 |
|
|
780 |
Freight costs |
|
|
3,272 |
|
|
6,266 |
|
|
2,563 |
|
|
5,609 |
Subtotal |
|
$ |
37,834 |
|
$ |
20,962 |
|
$ |
41,322 |
|
$ |
29,078 |
|
|
|
|
|
|
|
|
|
Divided by: |
|
|
|
|
|
|
|
|
Tons sold |
|
|
79 |
|
|
63 |
|
|
56 |
|
|
59 |
Average net realized sales
price per ton |
|
$ |
479 |
|
$ |
333 |
|
$ |
738 |
|
$ |
493 |
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
2022 |
(in thousands, except per ton
amounts) |
|
Potash |
|
Trio® |
|
Potash |
|
Trio® |
Total Segment Sales |
|
$ |
99,761 |
|
$ |
59,022 |
|
$ |
105,269 |
|
$ |
76,519 |
Less: Segment byproduct
sales |
|
|
11,500 |
|
|
2,740 |
|
|
9,762 |
|
|
2,216 |
Freight costs |
|
|
7,264 |
|
|
12,952 |
|
|
5,687 |
|
|
11,919 |
Subtotal |
|
$ |
80,997 |
|
$ |
43,330 |
|
$ |
89,820 |
|
$ |
62,384 |
|
|
|
|
|
|
|
|
|
Divided by: |
|
|
|
|
|
|
|
|
Tons sold |
|
|
167 |
|
|
128 |
|
|
126 |
|
|
131 |
Average net realized sales
price per ton |
|
$ |
485 |
|
$ |
339 |
|
$ |
713 |
|
$ |
476 |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2023 |
Product |
|
Potash Segment |
|
Trio®
Segment |
|
Oilfield Solutions Segment |
|
Intersegment Eliminations |
|
Total |
Potash |
|
$ |
41,106 |
|
$ |
— |
|
$ |
— |
|
$ |
(88 |
) |
|
$ |
41,018 |
Trio® |
|
|
— |
|
|
27,228 |
|
|
— |
|
|
— |
|
|
|
27,228 |
Water |
|
|
100 |
|
|
1,474 |
|
|
2,568 |
|
|
— |
|
|
|
4,142 |
Salt |
|
|
3,278 |
|
|
46 |
|
|
— |
|
|
— |
|
|
|
3,324 |
Magnesium Chloride |
|
|
1,667 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
1,667 |
Brine Water |
|
|
1,113 |
|
|
— |
|
|
1,001 |
|
|
— |
|
|
|
2,114 |
Other |
|
|
— |
|
|
— |
|
|
1,542 |
|
|
— |
|
|
|
1,542 |
Total Revenue |
|
$ |
47,264 |
|
$ |
28,748 |
|
$ |
5,111 |
|
$ |
(88 |
) |
|
$ |
81,035 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30,
2023 |
Product |
|
Potash Segment |
|
Trio®
Segment |
|
Oilfield Solutions Segment |
|
Intersegment Eliminations |
|
Total |
Potash |
|
$ |
88,261 |
|
$ |
— |
|
$ |
— |
|
$ |
(189 |
) |
|
$ |
88,072 |
Trio® |
|
|
— |
|
|
56,282 |
|
|
— |
|
|
— |
|
|
|
56,282 |
Water |
|
|
180 |
|
|
2,522 |
|
|
4,187 |
|
|
— |
|
|
|
6,889 |
Salt |
|
|
6,321 |
|
|
218 |
|
|
— |
|
|
— |
|
|
|
6,539 |
Magnesium Chloride |
|
|
2,804 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
2,804 |
Brine Water |
|
|
2,195 |
|
|
— |
|
|
1,823 |
|
|
— |
|
|
|
4,018 |
Other |
|
|
— |
|
|
— |
|
|
3,351 |
|
|
— |
|
|
|
3,351 |
Total Revenue |
|
$ |
99,761 |
|
$ |
59,022 |
|
$ |
9,361 |
|
$ |
(189 |
) |
|
$ |
167,955 |
|
|
Three Months Ended June 30, 2022 |
Product |
|
Potash Segment |
|
Trio®
Segment |
|
Oilfield Solutions Segment |
|
Intersegment Eliminations |
|
Total |
Potash |
|
$ |
43,885 |
|
$ |
— |
|
$ |
— |
|
$ |
(66 |
) |
|
$ |
43,819 |
Trio® |
|
|
— |
|
|
34,687 |
|
|
— |
|
|
— |
|
|
|
34,687 |
Water |
|
|
363 |
|
|
724 |
|
|
3,692 |
|
|
— |
|
|
|
4,779 |
Salt |
|
|
2,658 |
|
|
56 |
|
|
— |
|
|
— |
|
|
|
2,714 |
Magnesium Chloride |
|
|
1,199 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
1,199 |
Brine Water |
|
|
722 |
|
|
— |
|
|
648 |
|
|
— |
|
|
|
1,370 |
Other |
|
|
— |
|
|
— |
|
|
3,172 |
|
|
— |
|
|
|
3,172 |
Total Revenue |
|
$ |
48,827 |
|
$ |
35,467 |
|
$ |
7,512 |
|
$ |
(66 |
) |
|
$ |
91,740 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2022 |
Product |
|
Potash Segment |
|
Trio® Segment |
|
Oilfield Solutions Segment |
|
Intersegment Eliminations |
|
Total |
Potash |
|
$ |
95,507 |
|
$ |
— |
|
$ |
— |
|
$ |
(161 |
) |
|
$ |
95,346 |
Trio® |
|
|
— |
|
|
74,303 |
|
|
— |
|
|
— |
|
|
|
74,303 |
Water |
|
|
1,137 |
|
|
1,926 |
|
|
7,880 |
|
|
— |
|
|
|
10,943 |
Salt |
|
|
5,292 |
|
|
290 |
|
|
— |
|
|
— |
|
|
|
5,582 |
Magnesium Chloride |
|
|
2,014 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
2,014 |
Brine Water |
|
|
1,319 |
|
|
— |
|
|
1,387 |
|
|
— |
|
|
|
2,706 |
Other |
|
|
— |
|
|
— |
|
|
5,245 |
|
|
— |
|
|
|
5,245 |
Total Revenue |
|
$ |
105,269 |
|
$ |
76,519 |
|
$ |
14,512 |
|
$ |
(161 |
) |
|
$ |
196,139 |
Three Months
EndedJune 30, 2023 |
|
Potash |
|
Trio® |
|
Oilfield Solutions |
|
Other |
|
Consolidated |
Sales |
|
$ |
47,264 |
|
$ |
28,748 |
|
$ |
5,111 |
|
$ |
(88 |
) |
|
$ |
81,035 |
Less: Freight costs |
|
|
4,338 |
|
|
6,266 |
|
|
— |
|
|
(88 |
) |
|
|
10,516 |
Warehousing and handling
costs |
|
|
1,609 |
|
|
1,192 |
|
|
— |
|
|
— |
|
|
|
2,801 |
Cost of goods sold |
|
|
28,441 |
|
|
20,068 |
|
|
3,827 |
|
|
— |
|
|
|
52,336 |
Gross Margin |
|
$ |
12,876 |
|
$ |
1,222 |
|
$ |
1,284 |
|
$ |
— |
|
|
$ |
15,382 |
Depreciation, depletion, and
amortization incurred1 |
|
$ |
6,429 |
|
$ |
1,405 |
|
$ |
915 |
|
$ |
223 |
|
|
$ |
8,972 |
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June
30, 2023 |
|
Potash |
|
Trio® |
|
Oilfield Solutions |
|
Other |
|
Consolidated |
Sales |
|
$ |
99,761 |
|
$ |
59,022 |
|
$ |
9,361 |
|
$ |
(189 |
) |
|
$ |
167,955 |
Less: Freight costs |
|
|
9,343 |
|
|
12,952 |
|
|
— |
|
|
(189 |
) |
|
|
22,106 |
Warehousing and handling
costs |
|
|
3,089 |
|
|
2,445 |
|
|
— |
|
|
— |
|
|
|
5,534 |
Cost of goods sold |
|
|
60,025 |
|
|
40,951 |
|
|
7,605 |
|
|
— |
|
|
|
108,581 |
Gross Margin |
|
$ |
27,304 |
|
$ |
2,674 |
|
$ |
1,756 |
|
$ |
— |
|
|
$ |
31,734 |
Depreciation, depletion, and
amortization incurred1 |
|
$ |
13,482 |
|
$ |
2,611 |
|
$ |
1,822 |
|
$ |
429 |
|
|
$ |
18,344 |
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended June 30, 2022 |
|
Potash |
|
Trio® |
|
Oilfield Solutions |
|
Other |
|
Consolidated |
Sales |
|
$ |
48,827 |
|
$ |
35,467 |
|
$ |
7,512 |
|
$ |
(66 |
) |
|
$ |
91,740 |
Less: Freight costs |
|
|
3,682 |
|
|
5,611 |
|
|
— |
|
|
(66 |
) |
|
|
9,227 |
Warehousing and handling
costs |
|
|
1,209 |
|
|
995 |
|
|
— |
|
|
— |
|
|
|
2,204 |
Cost of goods sold |
|
|
19,011 |
|
|
15,809 |
|
|
3,678 |
|
|
— |
|
|
|
38,498 |
Gross Margin |
|
$ |
24,925 |
|
$ |
13,052 |
|
$ |
3,834 |
|
$ |
— |
|
|
$ |
41,811 |
Depreciation, depletion, and
amortization incurred1 |
|
$ |
6,085 |
|
$ |
1,042 |
|
$ |
803 |
|
$ |
176 |
|
|
$ |
8,106 |
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June
30, 2022 |
|
Potash |
|
Trio® |
|
Oilfield Solutions |
|
Other |
|
Consolidated |
Sales |
|
$ |
105,269 |
|
$ |
76,519 |
|
$ |
14,512 |
|
$ |
(161 |
) |
|
$ |
196,139 |
Less: Freight costs |
|
|
7,705 |
|
|
11,920 |
|
|
— |
|
|
(161 |
) |
|
|
19,464 |
Warehousing and handling
costs |
|
|
2,533 |
|
|
2,147 |
|
|
— |
|
|
— |
|
|
|
4,680 |
Cost of goods sold |
|
|
41,041 |
|
|
33,261 |
|
|
8,706 |
|
|
— |
|
|
|
83,008 |
Gross Margin |
|
$ |
53,990 |
|
$ |
29,191 |
|
$ |
5,806 |
|
$ |
— |
|
|
$ |
88,987 |
Depreciation, depletion and
amortization incurred1 |
|
$ |
13,033 |
|
$ |
2,050 |
|
$ |
1,590 |
|
$ |
411 |
|
|
$ |
17,084 |
(1) Depreciation, depletion, and amortization incurred for
potash and Trio® excludes depreciation, depletion, and amortization
amounts absorbed in or relieved from inventory.
Intrepid Potash (NYSE:IPI)
Graphique Historique de l'Action
De Avr 2024 à Mai 2024
Intrepid Potash (NYSE:IPI)
Graphique Historique de l'Action
De Mai 2023 à Mai 2024