2013-01-17 22:32:12 -
DENVER; January 17, 2013 - Intrepid Potash Inc. (Intrepid) (NYSE:IPI) announced
today the following preliminary sales and production results for the fourth
quarter and full year 2012.
Preliminary Preliminary
Three Months Ended Year Ended
December 31, 2012 December 31, 2012
--------------------- -----------------------
Potash
Production (tons) 210,000 - 220,000 790,000 - 800,000
Sales (tons) 195,000 - 205,000 835,000 - 845,000
Average Net Realized Sales
Price ($/ton) $430 - $440 $450 - $455
Cash COGS, net of by-product
credit ($/ton) $175 - $185 $175 - $185
Total COGS ($/ton) $235 - $245 $235 - $245
Trio(®)
Production (tons) 30,000 - 35,000 130,000 - 135,000
Sales (tons) 40,000 - 45,000 120,000 - 130,000
Average Net Realized Sales
Price ($/ton) $340 - $350 $325 - $330
Cash COGS ($/ton) $205 - $215 $205 - $215
Total COGS ($/ton) $290 - $300 $280 - $290
Selling and Administrative $8.0 - $9.5 million $33.0 - $34.5 million
"Our preliminary results are consistent with our expectations of
a
strong fall application season, and we were pleased to see quarterly improvement
once again in the potash production rate from our East facility," said Bob
Jornayvaz, Intrepid's Executive Chairman of the Board. "Fall fertilizer sales
in North America were reflective of robust demand for potash across the markets
we serve."
A fundamental component to Intrepid's success is the commitment to and execution
of the long-term capital investment program, which is designed to grow
production of lower-cost tons across its portfolio of mining facilities. Each
major project remains on budget and continues to progress on all fronts. Total
capital investment in 2012 was $245 to $260 million. The amount of capital
investment is expected to be roughly comparable in 2013 with the expected
completion of the construction of the new HB Solar Solution mine project, the
North compaction facility, and a third cavern system in Moab. Capital
investment for 2013 is expected to be funded out of cash and investments, cash
flows, proceeds from the unsecured senior notes that are expected to fund in
April 2013, and periodic limited utilization of the existing unsecured credit
facility.
Two significant milestones occurred in the fourth quarter marking further
success in Intrepid's solar solution mining projects, which are designed to
produce incremental tons at lower cash costs. In November, as scheduled,
Intrepid's HB Solar Solution mine project began pumping potash-enriched brine
from the mine into the new solar evaporation ponds. This was a major event
keeping the original production timeline on target for late 2013. The HB Solar
Solution mine project remains in line with the $200 to $230 million budget, with
total capital invested through the end of 2012 in the range of $125 to $130
million.
The other milestone was accomplished with the completion of the development of
the second horizontal cavern network in Moab. As planned and on schedule, this
second multi-well horizontal cavern system has been put into production, and is
expected to benefit the Moab operations beginning with the 2013 evaporation
season.
In the fourth quarter, Intrepid declared and paid a special cash dividend of
$0.75 per share, or $56.5 million. The cash and investment balance at the end
of 2012 was $55 to $60 million.
Additionally, during the fourth quarter of 2012, Intrepid recorded a deferred
tax expense of approximately $5.0 to $5.5 million. This deferred income tax
expense is the result of the ongoing review of state income tax rates and the
application of the updated rate to the net deferred income tax asset. The
result of this normal recurring evaluation will be a higher effective tax rate
in the fourth quarter of 2012.
Intrepid reports "average net realized sales price," which is an operating
performance measure. Average net realized sales prices are derived by
subtracting freight costs from gross sales revenue and then dividing this result
by sales tons.
Fourth Quarter and Full Year 2012 Financial Results and Conference Call
Intrepid is scheduled to release fourth quarter and full year 2012 financial
results, including a current market update, capital project status, and
operations outlook, after market close on Wednesday, February 13, 2013. The
teleconference call to discuss fourth quarter and full year 2012 results is
scheduled for Thursday, February 14, 2013, at 8:00 a.m. MT (10:00 a.m. ET). The
call participation number is (800) 319-4610. A recording of the conference call
will be available two hours after the completion of the call at (800)
319-6413. International participants can dial (631) 982-4565 to take part in
the conference call and can access a replay of the call at (412) 317-0088. The
replay of the call will require the input of the conference identification
number 763324. The call will also be streamed on the Intrepid website,
www.intrepidpotash.com. In addition, the press release announcing fourth
quarter and full year 2012 results will be available on the Intrepid website
before the call under "Investor Relations - Press Releases." An audio recording
of the conference call will be available at www.intrepidpotash.com through March
14, 2013.
About Intrepid:
Intrepid (NYSE: IPI) is the largest producer of potash in the U.S. and is
dedicated to the production and marketing of potash and Trio(®), a product
produced from langbeinite ore. Intrepid owns five active potash production
facilities -- three in New Mexico and two in Utah. The HB Solar Solution mine,
which is currently under construction, will increase the number of our active
potash production facilities to six.
Intrepid routinely posts important information about its business, including
information about upcoming investor presentations, on its website under the
Investor Relations tab. Intrepid encourages investors and other interested
parties to enroll on its website to receive automatic email alerts or Really
Simple Syndication (RSS) feeds regarding new postings. The website address for
Intrepid is www.intrepidpotash.com.
* * * * * * * * * * *
This document contains forward-looking statements - that is, statements about
future, not past, events. The forward-looking statements in this document often
relate to our future performance and management's expectations for the future,
including statements about our financial outlook. These statements are based on
assumptions that we believe are reasonable. Forward-looking statements by their
nature address matters that are uncertain. For us, the particular uncertainties
that could cause our actual results to be materially different from our forward-
looking statements include the following:
* changes in the price, demand, or supply of potash or Trio(®)/langbeinite
* circumstances that disrupt or limit our production, including operational
difficulties or operational variances due to geological or geotechnical
variances
* interruptions in rail or truck transportation services, or fluctuations in
the costs of these services
* increased labor costs or difficulties in hiring and retaining qualified
employees and contractors, including workers with mining or construction
expertise
* the costs of, and our ability to successfully construct, commission and
execute, our strategic projects, including the development of our HB Solar
Solution mine, the further development of our langbeinite recovery and
granulation assets, and our North granulation plant
* adverse weather events, including events affecting evaporation rates at our
solar solution mines
* changes in the prices of raw materials, including chemicals, natural gas,
and power
* the impact of federal, state, or local government regulations, including
environmental and mining regulations, the enforcement of those regulations,
and government policy changes
* our ability to obtain any necessary government permits relating to the
construction and operation of assets
* changes in our reserve estimates
* competition in the fertilizer industry
* declines in U.S. or world agricultural production
* declines in the use of potash products by oil and gas companies in their
drilling operations
* changes in economic conditions
* our ability to comply with covenants in our debt-related agreements to avoid
a default under those agreements
* disruption in the credit markets
* our ability to secure additional federal and state potash leases to expand
our existing mining operations
* the other risks and uncertainties described in our periodic filings with the
U.S. Securities and Exchange Commission
This document contains preliminary financial and operating
results for the fourth quarter and full year of 2012. Preliminary results are
our estimates of actual results based on currently available information. We
have not completed our normal quarterly closing and review procedures. While we
believe our preliminary results are meaningful, they could be materially
different from our actual results. In addition, you should be aware that
preliminary results cover only a subset of all of the financial and operating
information that will be included with our actual results.
All information in this document speaks as of January
17, 2013. New information or events after that date may cause our forward-
looking statements in this document to change. We undertake no duty to update
or revise publicly any forward-looking statements to conform the statements to
actual results or to reflect new information or future events.
Contact:
Investor Relations: Gary Kohn
Phone: 303-996-3024
Email:
gary.kohn@intrepidpotash.com
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Intrepid Potash Inc via Thomson Reuters ONE
[HUG#1671351]
