Intrepid Potash Inc. reported a 22 percent increase in third-quarter net income for the third quarter ending Sept. 30, 2010, to $11.6 million ($.16 per diluted share) on sales of $91.5 million, compared to the year-ago $9.5 million ($.13 per diluted share) on sales of $66.4 million.
Third-quarter potash sales volumes were 221,000 st with an average price of $343/st, up from the year-ago 111,000 st and $458/st. Potash gross sales were $81.2 million, up from the year-ago $54.5 million.
“During the third quarter of 2010, the fall potash application in the fields was robust, and we are seeing the volumes of potash in the United States rebound to more historical levels,” said Bob Jornayvaz, Intrepid executive chairman of the board. He said it is one of the strongest fall demand periods in recent memory. He noted that the company has increased its prices by $125/st in a month’s time, and that it is currently holding off on taking new rail orders until it gets caught up on a backlog of rail shipments. Jornayvaz said this would allow the company to capitalize on the rising price environment. “Intrepid is prepared to sell 2011 tons at 2011 prices,” he added. He said it is only taking new orders for spot sales from its facilities.
Jornayvaz told analysts that Intrepid is hearing reports from customers that Canadian competitors are some 60-90 days behind on filling orders. He added that low natural gas prices are keeping nitrogen prices relatively low, meaning that potash can compete for a greater percentage of the money going into fertilizer purchases.
Jornayvaz said the market for standard potash remains challenging as there is price and volume pressure from Canadian producers. He believes export orders to China and India are down for standard potash, and that material is being pumped into the U.S.
Third-quarter langbeinite (Trio) volumes were 45,000 st with an average price of $173/st, compared to the year-ago 40,000 st and $246/st. Gross sales were down, at $10.2 million from $11.9 million. Intrepid said granular product is currently posted at $246/st and is on allocation.
Nine-month Intrepid net income was $27.1 million ($.36 per share) on sales of $263.1 million, down from the year-ago $48.6 million ($.65 per share) on sales of $228.7 million.
Nine-month potash sales volumes were 594,000 st with an average price of $354/st, compared to the year-ago 290,000 st and $610/st. Potash gross sales were up at $223.5 million from the year-ago $184.6 million.