Intrepid Potash Q1 Earnings Call Highlights

Key Points

• Intrepid Potash posted stronger first-quarter results, with adjusted net income from continuing operations rising to $8.2 million from $3.9 million a year ago and adjusted EBITDA increasing to $19 million. Higher fertilizer pricing and resilient demand helped drive the improvement.
• Pricing and volumes were broadly favorable across both potash and Trio, with average realized prices up 13% and 12%, respectively, and combined sales volumes reaching 211,000 tons, the company’s second-highest quarterly total since 2016. Management also said Trio delivered its best segment margin since 2022.
• The company raised its outlook and has a much stronger cash position after the $70 million South Ranch sale, with cash at roughly $170 million. Full-year potash production is now expected near the upper end of guidance, while 2026 capital spending is projected at $40 million to $50 million.

Intrepid Potash NYSE: IPI reported a stronger start to 2026, with management citing higher fertilizer pricing, resilient demand and operational improvements across its potash and Trio businesses during the company’s first-quarter earnings call.

CEO Kevin Crutchfield said adjusted net income from continuing operations was $8.2 million in the first quarter, up from $3.9 million in the same period last year. Adjusted EBITDA rose to $19 million from $14.6 million a year earlier.

“We’re looking forward to capitalizing on this momentum for the rest of the year,” Crutchfield said, adding that the quarter reflected “consistent execution across our core fertilizer business.”

Pricing and Volumes Support First-Quarter Results

Crutchfield said first-quarter performance was driven in part by supportive pricing and demand across the company’s fertilizer products. Intrepid’s average potash net realized sales price was $353 per ton, up 13% from $312 per ton in the prior-year quarter. Its average Trio net realized sales price was $387 per ton, up 12% from $345 per ton.

Combined potash and Trio sales volumes totaled 211,000 tons, which Crutchfield said was the company’s second-highest quarterly sales total since idling the West Mine in 2016. Potash sales volumes were 105,000 tons, while Trio sales volumes were 106,000 tons.

Management said Trio delivered its highest quarterly segment margin since 2022, and per-ton costs improved 5% compared with the first quarter of 2025.

In the financial review, management said potash production totaled 104,000 tons in the quarter, compared with 93,000 tons in the prior-year period. Potash sales were $46.1 million, up $2.5 million from the prior quarter, primarily due to higher realized pricing. Potash gross margin was $3.1 million, compared with $2.5 million last year, as higher pricing was partially offset by higher costs on similar volume.

Trio production was 69,000 tons, up 10% year over year. Trio sales were $52.5 million, up $2.7 million from a year earlier, as a 12% increase in average net realized sales price offset a 4% decline in tons sold. Trio margin was $14.8 million, up $4.4 million from last year.

Market Conditions Remain Constructive

Zachry Adams, vice president of sales and marketing, said potash saw “good subscription” during the winter fill program, with customers securing orders to meet most first-quarter requirements. After the order window closed, posted potash prices increased by $20 per ton, a change Adams said is reflected in second-quarter spot transactions.

Adams said Trio demand remains resilient because customers value its individual components, particularly sulfate, amid disruptions in raw sulfur supply from the Middle East. Trio pricing increased by $15 per ton in late March, with that increase expected to be reflected in spot second-quarter sales.

Globally, Adams said potash fundamentals have been supported by consistent production, broadly stable pricing and solid demand. He said Brazil and China imported potash at record levels in the first quarter, contributing to a balanced market and supporting a constructive outlook for the second half of the year.

Adams also noted that U.S. corn exports are on track to reach record levels for the 2025-2026 marketing year. He said prices for corn, soybeans and cotton have strengthened in recent weeks due to weather concerns, supportive demand and geopolitical tensions. However, he acknowledged concerns about the financial health of U.S. growers, saying affordability challenges have been intensified by input-cost volatility tied to conflict in the Middle East.

Operations Improve Across Potash and Trio

Rick Kim, vice president of operations, said the commissioning of a new continuous miner in the Trio segment has already increased tons per operating hour and improved efficiency. He said additional mill improvements have boosted recovery and operating hours per shift, supporting higher production of both granular and premium products.

In potash, Kim said the HB Mine has shown promising returns this spring, with higher mill recoveries and improved pond deposition extending expected runtime before the summer shutdown. He said Moab continues to see better plant efficiency, throughput and recovery, while early season evaporation appears promising.

At Wendover, Intrepid expects to begin construction on Primary Pond 8 this summer. Kim said the project will expand evaporative area and is expected to increase production in 2028. He also said Primary Pond 7 is expected to contribute more production this year.

Guidance and Capital Spending

For 2026, management said potash production is expected to be at the upper end of the company’s guidance range of 270,000 to 285,000 tons, citing recent improvements at HB. Trio production is expected to reach 285,000 to 300,000 tons, with cost of goods sold around $230 per ton.

For the second quarter, Intrepid expects potash sales volumes of 50,000 to 60,000 tons at an average net realized sales price of $380 to $390 per ton. Trio sales volumes are expected to be 70,000 to 80,000 tons at an average net realized sales price of $390 to $400 per ton.

The company expects 2026 capital spending of $40 million to $50 million, with most spending tied to sustaining capital, including work at the East Mine and the new primary pond at Wendover. Management said it is also evaluating additional high-return growth and productivity investments over the next 18 to 24 months.

South Ranch Sale Boosts Cash Position

Crutchfield highlighted the April 1 sale of the majority of the assets of the Intrepid South Ranch to HydroSource Logistics, LLC for total consideration of $70 million, including an $8 million deposit received in December 2025. He said the sale unlocked “decades worth of cash flows in a single transaction” and allows the company to refocus on fertilizer assets.

During the question-and-answer portion of the call, Crutchfield said Intrepid’s cash balance stood at approximately $170 million, plus or minus, after receiving the remaining proceeds from the ranch transaction. He said the company’s board is continuing to discuss capital allocation, including requests from investors to return capital to shareholders.

Crutchfield said Intrepid has focused first on improving the reliability and performance of its core assets, assessing long-term sustaining capital needs and identifying ways to increase volumes and reduce costs. He estimated long-term core operations should require roughly $35 million to $40 million per year of sustaining capital, with larger sustaining projects needed periodically.

On lithium, Crutchfield said Intrepid’s partners continue to advance FEL-3 engineering and permitting. He said the company expects to provide more detail on project economics after FEL-3 work is completed, including timing, build costs and operating costs.

About Intrepid Potash NYSE: IPI

Intrepid Potash, Inc is a leading U.S.-based producer and marketer of potash and related specialty fertilizer products. The company's primary business centers on potassium chloride, a key nutrient used in agricultural applications to enhance crop yield and quality. In addition to potash, Intrepid Potash produces magnesium chloride and sodium chloride, which serve a variety of markets including de-icing, dust control and industrial chemical production.

Intrepid Potash operates through a combination of solution mining, solar evaporation and conventional underground mining techniques.

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