Overland Park, Kan. — Compass Minerals reported a 32 percent drop in its third-quarter specialty fertilizer operating earnings, citing tighter margins due to its need to buy potash to supplement its own production because of lower evaporation rates at its Great Salt Lake facility. Third-quarter fertilizer earnings were $13.1 million on sales of $54.9 million, compared to the year-ago $19.4 million on sales of $51.1 million. Sales volumes were up, though average prices were down, at 90,000 st ($615/st) versus 81,000 st ($631/st). Lower prices were due in part to more exports, which traditionally represent about one-third of volumes in the third quarter, 25 percent annually. Unit product costs were $398/st versus the year-ago $323/st. Compass hopes to work its way through its higher-cost SOP inventory through the first quarter of 2013, meaning that fourth quarter 2012 will still include this product. The company expects to sell 90,000 st of SOP in the fourth quarter at attractive and stable prices. Nine-month fertilizer operating earnings were $47.7 million on sales of $169.6 million, compared to the year ago $57.4 million on sales of $156 million. Volumes were up at 277,000 st from 259,000 st, while prices were up at $613/st from $603/st. Compass-wide, third-quarter net earnings were off 73 percent to $9.4 million ($0.28 per diluted share) on sales of $181 million, versus the year-ago $34.6 million ($1.03 per share) on sales of $229.1 million. EBITDA dropped to $30.1 million from $66.3 million. The company’s salt business still lags behind year-ago levels, continuing to feel the impact of the 2011-2012 mild winter, as salt buyers have more than normal in inventories. Nine-month earnings were $58.8 million ($1.75 per share) on sales of $674.8 million, compared to the year-ago $105.1 million ($3.14 per share) on sales of $799.6 million. EBITDA was $133.8 million versus the year-ago $205.6 million
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