Intrepid Potash (IPI) Q2 2024 earnings summary

Executive summary

• Q2 2024 sales were $62.1M, down 23% year-over-year, with a net loss of $0.8M versus $4.3M net income in Q2 2023, driven by lower potash and Trio® prices and volumes.

• Adjusted EBITDA for Q2 2024 was $9.2M, up $1.5M sequentially but down from $15.8M year-over-year.

• Potash segment sales dropped 36% and Trio® segment sales declined 8% year-over-year, while oilfield solutions sales rose 8%.

• Board named Barth Whitham as Chair and began CEO search as current CEO remains on medical leave.

• Cash and cash equivalents rose to $51.7M at June 30, 2024, mainly due to a $45M payment from XTO under a cooperative development agreement.

Financial highlights

• Q2 2024 sales: $62.1M (down 23% year-over-year); Q2 net loss: $0.8M; Q2 gross margin: $7.6M (down from $15.4M); adjusted EBITDA: $9.2M.

• Potash average net realized price per ton: $405 in Q2 2024 (down 15%); Trio®: $314 (down 6%).

• Q2 potash gross margin was $3.3M, down from $12.9M year-over-year; Trio® segment gross margin reached $2.2M, up $1M year-over-year.

• Oilfield Solutions gross margin was $2.1M, up $800,000 year-over-year and flat sequentially.

• No long-term debt, $51M–$51.7M in cash, and no borrowings on a $150M revolver maturing August 2027.

Outlook and guidance

• Potash production for 2024 expected to be approximately 15% higher than 2023.

• Q3 potash sales volumes expected at 45,000–55,000 tons, with net realized price of $340–$350 per ton.

• Q3 Trio® sales volumes expected at 40,000–45,000 tons, with net realized price of $300–$310 per ton.

• 2024 capital investments expected at $40–$50M, with $20–$25M for sustaining capital.

• Potash and Trio® prices expected to remain pressured by global supply and recent summer-fill programs.