Compass Minerals International, Inc. (NYSE:CMP) Q1 2023 Earnings Call Transcript

And additionally, the snow pack that the Governor referenced in his executive order is kind of running above average. So we would expect a very efficient spring runoff. So that’s kind of point two. We don’t expect any de minimis impact in 2023. And then the third point I’d make is we will continue to work very closely with regulatory authorities out in Utah as it relates to the development of this berm management plan. But as a public company, we have stakeholders that have interests that we will protect up to and including the pursuit of legal action, if necessary. We certainly wouldn’t expected that to happen and certainly hope that that doesn’t happen. But we certainly reserve all of our rights in that regard to predict our mineral and water rights interest out in the Great Salt Lake, which are very valuable.

Hopefully that gives you some background. Thank you for that question.

Operator: We will take our next question from David Begleiter with Deutsche Bank.

David Begleiter: Kevin, just on highway deicing pricing in the quarter, up 12%. Why was it below the 15% you have, I guess, contracted in for the full year?

Kevin Crutchfield: I think, maybe Jamie could add a little color. But I think part of that is a function of just timing

Jamie Standen: Yes, I’ll jump in here, Kevin. There’s always customer mix. When we complete our bid season, we analyze the average price across the entire portfolio. If we get stronger weather or weaker weather in a region that happens to have higher prices or lower prices that will manifest itself as a variance from our bid season expected pricing outcome.

David Begleiter: And just on the EBITDA guidance for salt below the half, below — and I guess below the midpoint of range, but given where we are today in the winter and given the long term forecast. Is there a potential for this to be a mild winter and EBITDA close to the bottom end of that range you’ve articulated?

Kevin Crutchfield: So we shared today, David, is that based on the winter to date, I would say through January due to the sales to commitment dynamic that Jamie referenced, we believe will be below that midpoint, which is 235. The balance of the winter is before us. And like I always say in terms of the bell curve, there’s no reason for us to believe that it won’t be a normal winter for February and March. And so we could very well fall closer to the right side of that page than the left. It just depends on how the winter transpires. Jamie, anything

Jamie Standen: That’s exactly right. We’ve got 10, 12 weeks of winter left. And it seems like, if history is any indication that seasons are a little delayed, and I’m not projecting that it’s going to be a strong remaining part of the season, but it seems like events progress as well into March and sometimes even April. So I would say that we’ve got 10, 12 weeks of winter left, which will drive where we fall on that bell curve, David.

Operator: We’ll take our next question from Joel Jackson with BMO.

Unidentified Analyst: This is Joseph on for Joel. Just first, in terms of Fortress, is this still going to be a negative $5 million EBITDA contribution for fiscal 2023? And also, what would a reasonable contribution range look like for fiscal 2024 and what would’ve to happen to reach the high and low ends of that range?