Intrepid Potash Inc., Denver, posted a second-quarter net loss of $8.9 million ($0.07 per diluted share) on sales of $46.5 million compared to the year-ago net income of $5.6 million ($0.04 per share) and sales of $62.5 million. Adjusted EBITDA was $555,000, down from the year-ago $14.9 million.
“Our second quarter results were clearly affected by the COVID-19 pandemic as oilfield activity and water sales decreased significantly from the first quarter of 2020,” said Bob Jornayvaz, Intrepid Executive Chairman, President and CEO. “This overshadowed a strong finish to the spring application season and good 2020 evaporation rates at our potash facilities.”
The company said industrial potash sales were also off due to COVID-19. The company said the improved weather early this year pulled more ag sales into the first-quarter, causing lower volumes in the second-quarter. Trio prices were up, with the company citing more domestic sales versus international. The company said competitors had released fill programs, cutting prices for both potash and Trio, and it expects these reduced prices to continue at least through the third quarter.
Jornayvaz added that the company has good pond levels at its solar facilities and magnesium chloride production is back at normal rates in Wendover. He said well completion activity resumed in the Delaware Basin in recent weeks, although the company still expects a gradual climb back to the first quarter water sales rate.
“Given the uncertainty, we continue to thoughtfully manage our balance sheet with good availability remaining under our revolving credit facility at very favorable rates and the potential to expand that facility in the future. The early repayment of our Series C Notes not only lowers our effective interest rate, but paves the way for a simpler debt structure that will allow us to more effectively pursue our strategy. We have also used our entire Paycheck Protection Program loan to pay eligible payroll expenses and expect the loan will be forgiven later in the year.”
“The underlying resource of the Delaware Basin hasn’t changed and we are still optimistic about the long-term potential of an area that is full of well-financed and long-term focused operators,” he added. “While we must remain prudent in our capital decisions, we are not shying away from what we believe are generational opportunities to expand our oilfield solutions assets in southeast New Mexico.”
Intrepid posted a six-month loss of $16.3 million ($0.13 per share) on sales of $110.4 million, compared to year-ago net income of $11.8 million ($0.09 per share) and sales of $120.1 million. Adjusted EBITDA was $9.4 million, down from the year-ago $30.8 million.
| Potash | 2Q-20 | 2Q-19 | YTD-20 | YTD-19 |
| Sales ($000) | 24,526 | 35,547 | 58,317 | 69,877 |
| Gross Margin ($000) | 2,015 | 8,228 | 6,349 | 17,592 |
| Production (000 st) | 4 | 56 | 140 | 167 |
| Sales Volume (000 st) | 74 | 95 | 173 | 183 |
| Avg Realized Price ($/st) | 256 | 299 | 256 | 294 |
| Trio | 2Q-20 | 2Q-19 | YTD-20 | YTD-19 |
| Sales ($000) | 19,251 | 21,435 | 41,832 | 39,245 |
| Gross Margin ($000) | (3,225) | 1,454 | (6,780) | 2,186 |
| Production (000 st) | 50 | 66 | 100 | 129 |
| Sales Volume (000 st) | 64 | 71 | 140 | 127 |
| Avg Realized Price ($/st) | 208 | 196 | 200 | 200 |
| Oilfield Solutions | 2Q-20 | 2Q-19 | YTD-20 | YTD-19 |
| Sales ($000) | 2,747 | 5,641 | 10,488 | 12,263 |
| Gross Margin ($000) | 611 | 3,489 | 5,455 | 6,561 |