Intrepid Potash Inc., Denver, posted a third-quarter loss of $10.2 million ($0.78 per diluted share), citing reduced water sales due to COVID-19, which reduced oilfield activity. In addition, it also reported lower potash and Trio prices and volumes. The company had a year-ago loss of only $217,000 ($0.02 per share).
Third-quarter adjusted EBITDA was $1.54 million, down from the year-ago $9.6 million. Sales were $38.1 million, down from $51.2 million.
“Our third-quarter results continue to be affected by the COVID-19 pandemic, as oilfield activity and water sales remain below prior year levels, but up significantly from the second quarter of 2020,” said Bob Jornayvaz, Intrepid’s Executive Chairman, President, and CEO. “Operators are focusing their attention on the strong underlying resource in the Delaware Basin and are forecasting continued improvements in demand over the coming months, which we believe will benefit our bottom line.
“For potash, we ended the summer 2020 evaporation season with great pond levels across our facilities,” Jornayvaz continued. “This will lead to lower per-ton production costs in the coming quarters, and when considered along with the recent price increases, positions us to generate solid cash flow during the spring season. We continue to thoughtfully manage our balance sheet due to the considerable uncertainty still surrounding the COVID-19 pandemic, and remain optimistic about the potential of our business.”
Intrepid said agricultural and industrial potash sales volumes decreased in the quarter and it sold fewer tons into the summer fill program than during the previous year. Likewise, industrial sales were down.
The company said Trio volumes decreased as it continued to sell fewer tons into the international market and focused on the higher priced domestic market.
Intrepid recorded a $2.9 million lower of cost or net realizable value inventory adjustment in the first nine months, it said primarily due to the Trio summer fill price announced by its competitor in June, which lowered the list price of Trio by $15-$20 per ton. It expects to sell at these reduced prices until midway through the fourth quarter.
Intrepid had a nine-month net loss of $26.4 million ($2.04 per share) on sales of $148.5 million, compared to year-ago net income of $11.5 million ($0.88 per share) and $171.2 million. Adjusted EBITDA was $10.7 million, down from $40.5 million.
| Potash | 3Q-20 | 3Q-19 | YTD-20 | YTD-19 |
| Sales ($ 000) | 22,187 | 29,213 | 80,504 | 99,090 |
| Gross Margin ($ 000) | 1,353 | 4,588 | 7,703 | 22,180 |
| Sales Volume (000 st) | 66 | 78 | 239 | 261 |
| Production (000 st) | 61 | 51 | 202 | 217 |
| Avg Net Realized Price* | 238 | 266 | 251 | 285 |
| Trio | 3Q-20 | 3Q-19 | YTD-20 | YTD-19 |
| Sales ($ 000) | 12,890 | 14,637 | 54,722 | 53,881 |
| Gross Margin ($ 000) | (1,348) | (1,108) | (8,129) | 1,077 |
| Sales Volume (000 st) | 40 | 46 | 180 | 173 |
| Production (000 st) | 55 | 54 | 155 | 183 |
| Avg Net Realized Price* | 189 | 204 | 197 | 201 |
| Oilfield Solutions | 3Q-20 | 3Q-19 | YTD-20 | YTD-19 |
| Sales ($ 000) | 3,050 | 7,310 | 13,539 | 19,574 |
| Gross Margin ($ 000) | (313) | 3,469 | 5,142 | 10,031 |
*$/st