Compass Minerals Files 2023 10-K Amendment

Ticker: CMP · Form: 10-K/A · Filed: Oct 29, 2024 · CIK: 1227654

Sentiment: neutral

Topics: amendment, financial-disclosure, mining

TL;DR

Compass Minerals filed a 10-K/A for FY23, check asset/liability details.

AI Summary

Compass Minerals International Inc. filed an amendment to its 2023 10-K on October 29, 2024, reporting on its fiscal year ending September 30, 2023. The filing details financial information related to its mining operations, including property, plant, and equipment, as well as various current and noncurrent liabilities. The company, formerly known as Salt Holdings Corp, is based in Overland Park, KS.

Why It Matters

This amendment provides updated financial disclosures for Compass Minerals, which could impact investor understanding of the company's assets and liabilities as of September 30, 2023.

Risk Assessment

Risk Level: low — This filing is an amendment to a previous 10-K, primarily containing financial statement details and disclosures, rather than new strategic or operational risks.

Key Numbers

Key Players & Entities

FAQ

What specific financial statement items are detailed in this 10-K/A amendment?

The filing references US GAAP items such as 'OtherAssetsNoncurrent', 'PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetAfterAccumulatedDepreciationAndAmortization', 'AccruedLiabilitiesCurrent', and 'OtherLiabilitiesNoncurrent'.

When was Compass Minerals International Inc. previously known by another name?

The company was formerly known as SALT HOLDINGS CORP, with a date of name change on 20030416.

What is the primary business address of Compass Minerals International Inc.?

The business address is 9900 W. 109TH STREET, SUITE 100, OVERLAND PARK, KS 66210.

What is the SIC code for Compass Minerals International Inc.?

The Standard Industrial Classification code is 1400, categorized under 'MINING, QUARRYING OF NONMETALLIC MINERALS (NO FUELS)'.

What is the accession number for this 10-K/A filing?

The accession number for this filing is 0001227654-24-000210.

Filing Stats: 4,460 words · 18 min read · ~15 pages · Grade level 16 · Accepted 2024-10-29 17:23:24

Key Financial Figures

Filing Documents

, Items 10, 11, 12, 13 and 14

Part III, Items 10, 11, 12, 13 and 14 Auditor Name Auditor Location Auditor Firm ID Ernst & Young LLP Kansas City, MO 42 EXPLANATORY NOTE Compass Minerals International, Inc. (collectively with its subsidiaries, the "Company") filed its Annual Report on Form 10-K for the year ended September 30, 2023 with the Securities and Exchange Commission (the "SEC") on November 29, 2023 (the "Original Report"). The Company is filing this Amendment No. 1 on Form 10-K/A (this "Form 10-K/A" or this "report") to restate the Company's previously issued consolidated financial statements as of and for the periods ended September 30, 2023, 2022 and 2021, as well as to provide certain restated interim financial information as of and for the period ended June 30, 2023 (the "restatement"). Background The restatement is being made to correct misstatements related to certain contingent consideration associated with the Company's acquisition of Fortress North America, LLC ("Fortress"). In connection with its review of future Fortress cash outflows, the Company identified misstatements related to the measurement of the milestone contingent consideration liability of up to $28 million to be paid in cash and/or common stock of the Company at a fixed price per share of approximately $32 upon the achievement of certain performance measures within five years of May 5, 2023, the effective date of the Fortress acquisition. The misstatements were the result of a failure to factor the option value, at the acquisition date and subsequently, of the potential share settlement into the fair value of the milestone contingent consideration liability and primarily relate to (i) the fair value of the milestone contingent consideration liability included in the initial purchase price allocation, which also impacted the total purchase price in excess of the net identifiable assets recognized as goodwill at the acquisition date, and (ii) the ongoing fair value measurement adjustments of the milestone

, Item 1, "Business"

Part I, Item 1, "Business"

, Item 1A, " Risk Factors "

Part I, Item 1A, " Risk Factors "

, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations"

Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations"

, Item 8, "Financial Statements and Supplementary Data"

Part II, Item 8, "Financial Statements and Supplementary Data"

, Item 9A, "Controls and Procedures"

Part II, Item 9A, "Controls and Procedures"

, Item 15, "Exhibits and Financial Statement Schedules"

Part IV, Item 15, "Exhibits and Financial Statement Schedules" In addition, in accordance with applicable SEC rules, this Form 10-K/A includes new certifications required by Rule 13a-14 under the Exchange Act from the Company's Chief Executive Officer and Chief Financial Officer dated as of the date of filing of this Form 10-K/A as Exhibits 31.1, 31.2 and 32. For the convenience of the reader, this Form 10-K/A sets forth the Original Report, in its entirety, as amended to reflect the corrections described above. Please note that the only changes to the Original Report are those related to the matters described herein and only in the Items listed above. Part I, Item 1A, "Risk Factors" has been updated to reflect risks related to the restatement and material weakness discussed above, which are included under the heading " Risks Related to our Restatement and Internal Controls , " but this Item has not otherwise been updated to reflect developments occurring subsequent to the date of the Original Report. Except as described above and as disclosed in Part II, Item 8, Note 2 3 and N ote 24 , no changes have been made to the Original Report, and this Form 10-K/A does not modify, amend or update any of the other financial information or other information contained in the Original Report. Such information is as of the date of the Original Report and does not reflect any information or events occurring after the date of the Original Report. Such subsequent information or events include, among others, the information and events described in our Quarterly Reports on Form 10-Q for the fiscal quarters ended December 31, 2023 and March 31, 2024, which we are restating concurrently with this Form 10-K/A in an amendment to the Q2 2024 Form 10-Q, and the information and events described in our Current Reports on Form 8-K filed subsequent to the date of the Original Report. For a description of such subsequent information and events, please read our reports filed pursuant to the E

Page No

PART I Page No. Item 1.

Business

Business 4 Item 1A.

Risk Factors

Risk Factors 14 Item 1B. Unresolved Staff Comments 28 Item 1C. Cybersecurity 28 Item 2.

Properties

Properties 29 Item 3.

Legal Proceedings

Legal Proceedings 62 Item 4. Mine Safety Disclosures 62 PART II Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 64 Item 6. Reserved 65 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 66 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 84 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 86 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 153 Item 9A.

Controls and Procedures

Controls and Procedures 153 Item 9B. Other Information 155 Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections 155 PART III Item 10. Directors, Executive Officers and Corporate Governance 156 Item 11.

Executive Compensation

Executive Compensation 156 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 156 Item 13. Certain Relationships and Related Transactions, and Director Independence 156 Item 14. Principal Accounting Fees and Services 156 PART IV Item 15. Exhibits, Financial Statement Schedules 157 Item 16. Form 10-K Summary 163

SIGNATURES

SIGNATURES 164 1 2023 FORM 10-K/A Table of Contents COMPASS MINERALS INTERNATIONAL, INC. PART I CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Certain statements in this Form 10-K/A, including without limitation our or management's beliefs, expectations or opinions; statements regarding future events or future financial performance; our plans, objectives and strateg ies; plans to develop our lithium resource, including the timing of such development and any potential future project-level partnership relating to the lithium project; our outlook, including expected sales volumes and costs; the useful life of our mine properties; our expectation of extending the Goderich mine mineral lease; conversion of mineral resources into mineral reserves; existing or potential capital expenditures, capital projects and investments; the industry and our competition; projected sources of cash flow; potential leg al liability; proposed or recently enacted legislation and regulatory action; the seasonal distribution of working capital requirements; our reinvestment of foreign earnings outside the United States ("U.S."); repatriation of foreign earnings to the U.S.; payment of future dividends and ability to reinvest in our business; our ability to optimize cash accessibility and minimize tax expense; our debt service requirements; our liquidity needs; realization of potential savings from our restructuring activities; funding obligations for our United Kingdom ("U.K.") pension plan; outcomes of matters with taxing authorities; the seasonality of our business; the effects of climate change on us; and our ability to successfully remediate the material weaknesses in our internal control over financial reporting disclosed in this Form 10-K/A, are forward-looking statements. Forward-looking statements are those that predict or describe future events or trends and that do not relate solely to historical matters. We use words such as "may," "would," "could," "should," "wi

BUSINESS

ITEM 1. BUSINESS COMPANY OVERVIEW Compass Minerals is a leading provider of essential minerals focused on safely delivering where and when it matters to help solve nature's challenges for customers and communities. Our salt products help keep roadways safe during winter weather and are used in numerous other consumer, industrial, chemical and agricultural applications. Our plant nutrition products help improve the quality and yield of crops, while supporting sustainable agriculture. Our next-generation fire retardants help to slow, stop and prevent wildfires through the use of high-performing and environmentally-friendly products. Additionally, we have been pursuing development of a sustainable lithium salt resource to support the North American battery market, although the project has been suspended indefinitely beyond certain already committed items associated with the early stages of construction of our commercial scale demonstration unit. As of September 30, 2023, we operate 12 production and packaging facilities with nearly 2,000 employees throughout the U.S., Canada and the U.K., including: The largest underground rock salt mine in the world in Goderich, Ontario, Canada; The largest dedicated rock salt mine in the U.K. in Winsford, Cheshire; A solar evaporation facility located near Ogden, Utah, which is both the largest sulfate of potash specialty fertilizer ("SOP") production site, the largest solar salt production site in the Western Hemisphere and the source of the lithium salt resource that we intend to develop; and Several mechanical evaporation facilities producing consumer and industrial salt See Item 2, "Properties," for a discussion of our mining properties, including processing methods, facilities, production and summaries of our mineral resources and reserves, both in the aggregate and for our individual material mining properties. Our Salt segment provides highway deicing salt to customers in North America and the U.K. as well as consume

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