Compass Minerals International INC 10-Q Filing

Ticker: CMP · Form: 10-Q · Filed: May 15, 2024 · CIK: 1227654

Sentiment: neutral

Filing Stats: 4,722 words · 19 min read · ~16 pages · Grade level 8.2 · Accepted 2024-05-15 16:04:45

Key Financial Figures

Filing Documents

FINANCIAL INFORMATION Page

PART I. FINANCIAL INFORMATION Page Item 1.

Financial Statements

Financial Statements Consolidated Balance Sheets as of March 31, 2024 (unaudited) and September 30, 2023 2 Consolidated Statements of Operations for the three and six months ended March 31, 2024 and 2023 (unaudited) 3 Consolidated Statements of Comprehensive Loss for the three and six months ended March 31, 2024 and 2023 (unaudited) 4 Consolidated Statements of Stockholders' Equity for the three and six months ended March 31, 2024 and 2023 (unaudited) 5 Consolidated Statements of Cash Flows for the six months ended March 31, 2024 and 2023 (unaudited) 6

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 7 Item 2.

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 24 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 37 Item 4.

Controls and Procedures

Controls and Procedures 38

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 39 Item 1A.

Risk Factors

Risk Factors 39 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 39 Item 3. Defaults Upon Senior Securities 39 Item 4. Mine Safety Disclosures 39 Item 5. Other Information 39 Item 6. Exhibits 40

SIGNATURES

SIGNATURES 41 1 Table of Contents COMPASS MINERALS INTERNATIONAL, INC.

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements CONSOLIDATED BALANCE SHEETS (in millions, except share data) (Unaudited) March 31, 2024 September 30, 2023 ASSETS Current assets: Cash and cash equivalents $ 40.0 $ 38.7 Receivables, less allowance for doubtful accounts of $ 2.2 at March 31, 2024 and $ 2.3 at September 30, 2023 143.0 129.5 Inventories 367.7 392.2 Other 47.4 33.4 Total current assets 598.1 593.8 Property, plant and equipment, net 793.5 852.2 Intangible assets, net 102.0 120.0 Goodwill 5.9 96.8 Other 152.6 155.2 Total assets $ 1,652.1 $ 1,818.0 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 5.0 $ 5.0 Accounts payable 88.5 116.8 Accrued salaries and wages 18.7 25.7 Income taxes payable 13.9 16.5 Accrued interest 12.9 12.9 Accrued expenses and other current liabilities 61.9 98.9 Total current liabilities 200.9 275.8 Long-term debt, net of current portion 872.2 800.3 Deferred income taxes, net 59.6 58.5 Other noncurrent liabilities 131.7 166.2 Commitments and contingencies ( Note 9 ) Stockholders' equity: Common stock: $ 0.01 par value, 200,000,000 authorized shares; 42,197,964 issued shares at March 31, 2024 and September 30, 2023 $ 0.4 $ 0.4 Additional paid-in capital 419.7 413.1 Treasury stock, at cost — 865,027 shares at March 31, 2024 and 1,038,168 shares at September 30, 2023 ( 10.1 ) ( 8.7 ) Retained earnings 81.3 217.1 Accumulated other comprehensive loss ( 103.6 ) ( 104.7 ) Total stockholders' equity 387.7 517.2 Total liabilities and stockholders' equity $ 1,652.1 $ 1,818.0 The accompanying notes are an integral part of the consolidated financial statements. 2 Table of Contents COMPASS MINERALS INTERNATIONAL, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, in millions, except share and per share data) Three Months Ended March 31, Six Months Ended March 31, 2024 2023 2024 2023 Sales $ 364.0 $ 411.1 $ 705.7 $ 763.5 Shipping and handling cost 110.6 130.1 20

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Accounting Policies and Basis of Presentation: Compass Minerals International, Inc. ("CMI"), through its subsidiaries (collectively, the "Company"), is a leading global provider of essential minerals focused on safely delivering where and when it matters to help solve nature's challenges for customers and communities. The Company's salt products help keep roadways safe during winter weather and are used in numerous other consumer, industrial, chemical and agricultural applications. Its plant nutrition business is the leading North American producer of sulfate of potash ("SOP"), which is used in the production of specialty fertilizers for high-value crops and turf and helps improve the quality and yield of crops, while supporting sustainable agriculture. The Company's principal products are salt, consisting of sodium chloride and magnesium chloride, and SOP. The Company is working to develop next-generation, environmentally friendly fire retardants to help to slow, stop and prevent wildfires. Additionally, the Company had been pursuing the development of a sustainable lithium salt resource to support the North American battery market. However, as described in Note 5 , the Company has terminated its pursuit of the lithium development. The Company's production sites are located in the United States ("U.S."), Canada and the United Kingdom ("U.K."). The Company also provides records management services in the U.K. Except where otherwise noted, references to North America include only the continental U.S. and Canada, and references to the U.K. include only England, Scotland and Wales. References to "Compass Minerals," "our," "us" and "we" refer to CMI and its consolidated subsidiaries. CMI is a holding company with no significant operations other than those of its wholly-owned subsidiaries. The consolidated financial statements include the accounts of CMI and its wholly-owned domestic and foreign subsidiarie

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