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Compass 4Q earnings off 21 percent

February 8, 2017Breaking Industry NewsSteve Seay

Compass Minerals reported fourth-quarter net earnings, excluding special items, of $46.1 million ($1.35 per diluted share) on sales of $443.2 million, down from the year-ago $58.4 million ($1.72 per share) and $289.3 million, respectively.

Net earnings were $97.6 million, including approximately $51.5 million in a net after-tax benefit or $1.52 per share. This included a $59.3 million gain on the company’s equity investment in Produquimica, which was partially offset by a partial writedown of the Wolf Trax trade name.

The company called the results solid, saying they were driven by a resilient performance in the Salt segment, improved demand for potassium sulfate in North America and the addition of the Produquimica business in Brazil.

Plant Nutrition North America operating earnings were $8 million on sales of $62.6 million, down from the year-ago $11.5 million and $50.5 million, respectively. However, sales volumes were up at 95,000 st from the year-ago 62,000 st, while average prices were down at $657/st from $805/st.

Full-year net earnings, excluding special items, were $111.2 million ($3.27 per share) on sales of $1.14 billion, down from the year-ago $159.2 million ($4.69 per share) and $1.1 billion, respectively.

Full-year North American operating earnings were $21.1 million on sales of $203 million, down from the prior year’s $57.9 million and $238.4 million, respectively. Fertilizer volumes were up slightly at 313,000 st from 311,000 st, while average prices were down at $648/st from $765/st.

ITC rules in favor of domestic AS producers

The U.S. International Trade Commission on Feb. 8 voted 5-0 that domestic producers of ammonium sulfate were materially injured or threatened with material injury by reason of imports from China. This affirmative determination paves the way for the U.S. Department of Commerce (DOC) to issue antidumping and countervailing duty orders on ammonium sulfate imports from China at rates previously set by the DOC. The orders are expected to go into effect by March 13, 2017, and will remain in force for at least five years.

In January, the DOC issued final determinations that Chinese producers sold ammonium sulfate at prices less than fair value in the U.S. market and that those producers benefitted from countervailable subsidies. DOC set a dumping margin of 493.46 percent and a countervailable subsidy rate of 206.72 percent for all Chinese producers.

“We are very pleased with the ITC’s unanimous determination, which confirms that domestic producers and employees have been severely injured by the surge in dumped and subsidized imports from China” said Jim Costello, CEO of PCI Nitrogen. “Today’s decision will help ensure that U.S. manufacturers and workers can compete with imports on an equal footing. We thank the ITC and the Department of Commerce for all their hard work in these investigations.”