Overland Park, Kan. — While second-quarter specialty fertilizer sales were up 14 percent for Compass Minerals, to $56.2 million from the year-ago $49.5 million, operating earnings were off 26 percent, at $13.9 million from $18.7 million. Compass said production costs were up due to cool and rainy weather in 2011 at the Great Salt Lake solar evaporation ponds, which caused the company to have to buy potash to supplement its SOP production. As a result, cost per ton was up, at $398/st versus the year-ago $298/st. The company sold 91,000 st during the quarter at an average price of $612/st, up from the year-ago 83,000 st and $600/st, respectively. Compass says its SOP markets and prices remain stable, and that weather at the Great Salt Lake is almost ideal this year. It continues to project 2012 sales of 375,000 st. It expects to sell through its high-cost inventories in early 2013. Going forward, the company is looking at shifting some of its low-end Big Quill production to Great Salt Lake, and allocating more high-end production to Big Quill. Six-month fertilizer earnings were $34.6 million on sales of $114.7 million, compared to the year-ago $38 million on sales of $104.9 million. Volumes were 187,000 st ($612/st), versus the year-ago 178,000 st ($591/st). Compass-wide, net earnings were off 32 percent, to $9.5 million ($0.28 per diluted share) on sales of $178.5 million from the year-ago $14 million ($0.42 per share) on sales of $179.9 million. Sales in the company’s salt segment were off 6 percent, and the company expects an overhang in that market due to inventories that built up during the warm winter. As a result, third-quarter sales are forecast at only 1 million st, versus the year-ago record sales of 1.9 million st. Company-wide, six-month earnings were $49.4 million ($1.47 per share) on sales of $493.8 million, versus the year-ago $70.5 million ($2.11 per share) and sales of $570.5 million.
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