Slide 1: Investor Presentation December 2008
Exhibit 99.1 Investor Presentation December 2008
Slide 2: Forward-Looking Information
Forward-Looking Information Certain statements in this presentation, and other written or oral statements made by or on behalf of us, are “forward-looking statements” within the meaning of the federal securities laws. Statements regarding future events and developments and our future performance, as
Slide 3: Strategically Located, Potash-Only Company
Intrepid Potash Strategically Located, Potash-Only Company Washington Montana Vermont Maine North Dakota Oregon Minnesota New Hampshire Idaho New South Wisconsin York Dakota Wyoming Michigan Pennsylvania Iowa Nevada Ohio Nebraska Utah Illinois Indiana Colorado West Kansas Virginia Virginia Missouri
Slide 4: Company Overview
Company Overview The largest U.S. producer of potash or potassium fertilizer – Only Western world producer created and dedicated solely to potash-related products – Supplies 1.5% of Global demand and 8.5% of U.S. demand 1 of 2 global exporters of sulfate of potash magnesia, or langbeinite (Intrepid
Slide 5: A Strong Cash Position, Zero Debt, and Cash Flows
A Strong Cash Position, Zero Debt, and Cash Flows 1 Balance Sheet as of September 30, 2008 Pro Forma EBITDA (In millions) Cash and cash equivalents $139 million $100.0 100% $90.0 $83.7 90% $80.0 80% Debt Outstanding $ - $70.0 70% $55.1 $60.0 60% $36.2 $50.0 50% Availability under the $40.0 40% Credi
Slide 6: Building Upon Our History of Value Creation Through Innovation
Building Upon Our History of Value Creation Through Innovation February 2000: February 2004: April 2004: Acquired 2007 and 2008: Build Acquired Moab Acquired Carlsbad Wendover facility out of management facility from Potash facilities from from Reilly Chemical team to execute Corp. Mississippi Chemi
Slide 7: The Intrepid Potash Growth Story
The Intrepid Potash Growth Story Intrepid Production Capacity (‘000 tons)(1) Intrepid Potash List Price ($ per ton)(2) Potash 1,500 900 $800 800 700 1,200 600 500 400 900 300 200 100 600 0 2007 2008E 2009E 2010E 2011E J F M A M J J A S O N D J F M A M J J A S O N Effective Nameplate 2007 2008 Multip
Slide 8: Why Consider an Investment in Intrepid Potash
Why Consider an Investment in Intrepid Potash Strong Long-Term Industry Fundamentals The Only Western World Potash Pure-Play Attractive Leverage to Potash Price Strategically Located Assets Diversified Markets and Customer Base Well-Defined, Attractive Organic Growth Opportunities Long-Life Reserves
Slide 9: Demand and Supply Conditions Have Created Robust Pricing Environment
Demand and Supply Conditions Have Created Robust Pricing Environment Historical Potash Prices Example Prices Aug. 2008: Labor strike ($ / ton) at three Potash Corp. mines U.S. Midwest (fob warehouse) $843 spot 800 Saskatchewan (fob mine) $776 spot Aug. 2008: Record low Carlsbad (fob mine)(1) $800 sp
Slide 10: Minimal Potash Price Volatility
Minimal Potash Price Volatility Indexed Potash Prices Compared to Commodity Prices Since January 2006 450 Potash 400 Number of Weekly Price Declines (1) 350 Nickel 80 Nickel Crude Oil 66 Gold 59 300 Corn 57 Potash 0 250 Gold 200 Corn 150 100 Crude Oil 50 Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul
Slide 11: Potash has the Best Fundamentals
Potash has the Best Fundamentals Indexed Potash Prices Compared to Other Fertilizers Prices Since January 2008 250 Potash (Carlsbad) Number of Weekly Price Declines (1) DAP (New Orleans Barge) Urea 18 200 DAP 13 Potash 0 150 Urea (U.S. Gulf Prill Import) 100 50 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun
Slide 12: IPI Produces and Sells Potash Not Oil
IPI Produces and Sells Potash Not Oil Intrepid Stock Price Compared to Commodity Prices 180 Correlation Potash Price of $800 Potash for October ‘08 Potash Corn Crude Oil 160 Potash Price of IPI (0.69) 0.94 0.94 $503 at IPO 140 120 Crude Oil – The price of potash drives IPI earnings 100 Corn – Reduct
Slide 13: Increasing Population and Meat Consumption Driving Record Grain Demand, Prices
Increasing Population and Meat Consumption Driving Record Grain Demand, Prices World Population vs. Fertilizer and Meat Consumption Hectares of Arable Land per Person 8 350 0.50 7 300 0.38 6 250 0.40 0.32 5 0.29 200 0.30 4 0.25 150 0.22 0.21 3 100 0.20 2 1 50 0.10 0 0 1965 1970 1975 1980 1985 1990 1
Slide 14: Potash Deliveries Track Population Growth
Potash Deliveries Track Population Growth Historical CAGRs (%) Potash Deliveries 5-Year Forward Since 1962 Since 2000 CAGRS (2008 – 2012) World Potash Consumption ex. FSU 2.8% 3.6% China 11.9% World Potash Consumption 2.5% 3.5% India 6.0% India / China GDP Growth NA 9.5% Brazil 4.2% 80 8 In spite of
Slide 15: Strong Returns Continue for Corn Growers
Strong Returns Continue for Corn Growers Corn Farmer Revenue Less Operating Costs (1) Corn Farmer Pre-tax Profit per Bushel(2) $600 $2.50 $2.00 $500 $1.50 $400 $1.00 $300 $0.50 $0.00 $200 -$0.50 $100 -$1.00 $0 -$1.50 (1) Does not include fixed costs. Operating costs are defined as: seed fertilizer,
Slide 16: Tight Supply Fundamentals Through 2012
Tight Supply Fundamentals Through 2012 World Potash Production vs. Consumption Growth Assumes 92% Industry Operating Rate For New & Existing Supply 80 5.0% Demand Growth Potential future 75 production shortfalls 70 Inventory Drawdown in 2007 65 3.5% Fertecon Demand Growth Estimate 60 Cumulative Anno
Slide 17: Few Global Producers, With Strong Balance Sheets
Few Global Producers, With Strong Balance Sheets 11 – Net Debt/Market Capitalization averages 9.2% Production Share across all public companies 10 1.5% Intrepid 9 8 RoW Canpotex 28.5% 7 32.7% 6 5 23.8 13.4% 4 BPC PCS 3 Affiliates 2 1 0 (1) (2) (2) (3) (2) (4) PCS Mosaic Agrium Belaruskali Uralkali K
Slide 18: Intrepid Is Currently Evaluating Production Levels
Intrepid Is Currently Evaluating Production Levels Global Production and North American Inventory Levels Risks to Production 5,000 – Labor Shortage/Disputes 80,000 – Supply Shocks – Delays in Projects – Depletion 4,500 4,000 70,000 Global Production 3,500 Potash Inventory Trendline ? 60,000 3,000 2,
Slide 19: Why Potash Only?
Why Potash Only? Market Structure for Key Fertilizer Nutrients Potash Nitrogen Phosphate (4) Producing Countries 12 ~60 ~44 Key Inputs Potash ore Natural gas Phosphate rock Sulfuric acid Ammonia % of Overall Fertilizer Market 17% 59% 24% Market Share of 64% 13% Ammonia 41% Phosphoric Acid Top 5 Prod
Slide 20: Current Market Considerations
Current Market Considerations Global Buyer Hesitation Building Producer Inventories Elective Production Curtailments Potential Intrepid Management Actions Maintain Strong Balance Sheet Actively Monitor Market Environment to Avoid Excessive Build of Inventory Elective Production Curtailments Through
Slide 21: The Only Western World Potash Pure-Play
The Only Western World Potash Pure-Play Comparables Revenue by Product - North America Intrepid Potash Corp Mosaic Agrium Advanced Technologies Potash Phosphates Other Potash 6% Potash 4% 22% 24% 31% 34% 33% Nitrogen 2% Nitrogen 100% 48% Retail Phosphates 9% 34% 52% Potash Nitrogen Phosphates Compar
Slide 22: Strategically Located Assets
Strategically Located Assets Average Potash Consumption Over 5x Greater than Production in Our Markets Total KCL Equivalent Consumption in Region = 5.6MM Tons Total Intrepid Potash’s Effective KCL Capacity in Production = 1.0MM Tons Washington Oregon Idaho Wyoming Iowa Nebraska Nevada Illinois Utah
Slide 23: Strategically Located: Location, Tax Advantage, and Leverage to Potash Price
Strategically Located: Location, Tax Advantage, and Leverage to Potash Price (1) Intrepid vs. North American Competitors Intrepid’s Advantage Most Recently Reported Quarter ($ per ton) Most Recently Reported Quarter ($ per ton) 800 120 109 623 99 600 524 99 90 60 400 (213) (223) + = 10 30 10 200 0 (
Slide 24: Diversified Markets and Customer Base
Diversified Markets and Customer Base YTD 2008 Intrepid Potash Sales (1) We sell Potash into 3 different markets: Agricultural, Industrial and Feed Industrial – Agricultural represents 64% of Intrepid sales compared to an industry average of 95%(2) Includes: Barley Corn Agricultural primarily consum
Slide 25: Low-Cost, Solar Evaporation Assets
Low-Cost, Solar Evaporation Assets
Slide 26: HB Potash Solution Mine: Innovate and Increase
HB Potash Solution Mine: Innovate and Increase $446 per ton Capex to reopen an existing mine compared Potash Pillar to an estimated cost of ~$1,200 per ton for greenfield projects HB expected to be among the lower-cost potash mines in North America – Same proven solar evaporation and solution mining
Slide 27: Well-Defined Attractive Growth Opportunities to Increase Production
Well-Defined Attractive Growth Opportunities to Increase Production Capital Estimates ($MM) Additional $ Capital/ Estimated Estimate Product Ton of Facility Estimated time of on Capital ($000s) Tons Capacity Production (000s Tons) ($/Ton) Potash Debottlenecking and Expansion Projects at Existing Fac
Slide 28: Opportunity at the North Mine
Opportunity at the North Mine Current infrastructure allows North Mine to reopen at a capital cost much less than a greenfield project – Full conventional underground mine and process facility, idled in early 1980’s – Two concrete lined shafts, utilities, brine disposal, tailings disposal and other
Slide 29: Low-Cost, Low-Sovereign Risk Expansions
Low-Cost, Low-Sovereign Risk Expansions Capital Cost Curve for Announced Potash Expansion Projects 1,200 Greenfield Project Intrepid Greenfield (HB) Brownfield Project 1,000 Intrepid Brownfield 800 600 400 200 0 17,061 MOS / PCS / Intrepid Rio Tinto PCS Mosaic MagMinerals (Argentina) (Congo) Increme
Slide 30: Intrepid 2008 Guidance as of Nov. 11, 2008
Intrepid 2008 Guidance as of Nov. 11, 2008; However, the Market Seems to be Changing Production: – Potash 850,000 to 870,000 tons – Langbeinite (Trio™) 200,000 to 215,000 tons Cash Cost of Goods Sold excluding royalties and by-product credits: – Potash $155 to $165 per ton – Langbeinite $75 to $85 p
Slide 31: Why Consider an Investment in Intrepid Potash
Why Consider an Investment in Intrepid Potash Strong Long-Term Industry Fundamentals The Only Western World Potash Pure-Play Attractive Leverage to Potash Price Strategically Located Assets Diversified Markets and Customer Base Well-Defined, Attractive Organic Growth Opportunities Long-Life Reserves
Slide 32: Appendix
POTASH Appendix
Slide 33: Innovate and Increase Production
Innovate and Increase Production Unique and Innovative Growth Projects Completed Since 2002 Additional Product $ Capital/ Tons Ton of Capacity Facility Completed Capital ($000’s) (000’s Tons) ($/Ton) st 1 Horizontal Potash Cavern Moab Q4 2004 5,000 40 125 nd 2 Horizontal Potash Cavern Moab Q4 2005 5
Slide 34: Improvements: Reliability and Efficiency
Improvements: Reliability and Efficiency Location Project Description Moab, UT Drilled and completed first potash horizontal solution mining caverns Refurbish warehouses Upgraded electrical system Optimized potash and tails leaching Wendover, UT Drilled and completed two corrosion-resistant deep-bri
Slide 35: Long-Life Reserves
Long-Life Reserves (1) Current Annual Current Annual Current Minimum Nameplate Effective Date Mine Remaining Product / Operations Extraction Capacity in Capacity in Opened Life Method Potash Product Potash Product (years) Tons Tons Muriate of Potash Solar Moab 1965 Solution 124 180 93 Wendover 1932
Slide 36: Global Industry Susceptible to Production Interruptions & Supply Shocks
Global Industry Susceptible to Production Interruptions & Supply “Shocks” Mine Closures Due to Water Inflows St. Paul mine (Congo) Berezniki 3 mine PCA (Patience Lake) Potacan mine Berezniki I (0.8MM tons KCL / yr) (1.8MM tons KCL / yr) (0.8MM tons KCL / yr) (0.8MM tons KCL / yr) (1.3MM tons KCL / y
Slide 37: Demand Growth from BRICs Reaching Recommended Application Levels
Demand Growth from BRICs Reaching Recommended Application Levels China India Brazil Goal to attain self-sufficiency History of under application of Increasing land use for of food supply potash agricultural purposes Need to increase yields Current Potential Current Potential Current Potential Source
Slide 38: Fertilizer Use Far Below Recommended Rates
Fertilizer Use Far Below Recommended Rates Global Application Rates (lb/acre) 86% Shortfall 112 120 100 288% Shortfall 146% Shortfall 80 66 60 59 60 40 24 17 20 0 Nitrogen Phosphate Potash Current Application Rate Scientifically Recommended Rate Source: Morgan Stanley, Agricultural Products Research
Slide 39: Solar Evaporation and Solution Mining Technology
Solar Evaporation and Solution Mining Technology Existing Solar Evaporation Facility Year Opened Dead Sea Works (ICL) 1970 Arab Potash Company 1973 SQM Salar 1996 Intrepid Moab 1970 Intrepid Wendover 1932 Qinghai Salt Lake Potash Corp - Compass Minerals - Rincon Salar - Existing Solution Mining Faci
Slide 40: Carlsbad Potash Area
Carlsbad Potash Area NZ Paved Road Intrepid Potash, Inc. . mks Carlsbad Potash Area i. en Eddy & Lea Counties, New Mexico = Mine Shaft “oh — ee — tet Mine Base Map
Slide 41: HB– Phase I Potash Mine Flood Area
HB– Phase I Potash Mine Flood Area
Slide 42: Conversion Rates
Conversion Rates 1 metric tonne = 1.102 short tons 1 product ton of potash (KCL or KCL Equivalent) = 61% K20 1 product ton of langbeinite = 22% K2 0 1 product ton of SOP = 50% K20
Slide 43: Select Pro Forma Operating Data
Select Pro Forma Operating Data 1 Adjusted Pro Forma Net Income Pro Forma EBITDA (In millions) (In millions, except gross margin percentage) $49.8 $100.0 100% 62% $90.0 57% $83.7 90% $80.0 80% $31.6 40% $70.0 70% $55.1 $60.0 29% 21% 60% 23% $50.0 24% $36.2 50% $15.9 $40.0 40% $30.0 30% $20.0 $12.2 2
Slide 44: Select Operating Data
Select Operating Data Potash Net Sales Price Langbeinite Net Sales Price (Per short ton) (Per short ton) Red Granular Current list price $800 per ton $623 Granular Lang Current list price $356 per ton $425 $283 $295 $188 $224 $193 $178 $182 $137 $137 $123 $108 $109 Q107 Q207 Q307 Q407 Q108 Q208 Q308
Slide 45: Pro Forma EPS Growth as we Capture most of the Price Increases as Earnings
Pro Forma EPS Growth as we Capture most of the Price Increases as Earnings Net Sales Pro Forma Earnings Per Share (In millions) (Diluted) $0.66 $0.43 $141.2 $99.5 $0.26 $74.2 $50.8 $47.8 $51.3 $42.5 $0.05 $0.05 $0.07 $0.06 Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q107 Q207 Q307 Q407 Q108 Q208 Q308
Slide 46: Non-GAAP Reconciliation
Non-GAAP Reconciliation We define EBITDA as income from continuing operations before interest, income taxes, depreciation, depletion, amortization and accretion. EBITDA is used as a supplemental financial measure by our management and by external users of our financial statements to assess: – The fi
Slide 47: Historical Production and Sales Summary
Historical Production and Sales Summary INTREPID POTASH, INC. SELECTED OPERATIONS DATA (UNAUDITED) (Data in short tons) 2008 2007 September 30, June 30, March 31, December 31, September 30, June 30, March 31, Production volume (in ‘000 per short tons) Potash 200 210 224 217 233 210 218 Langbeinite 5
Slide 48: Corn Growers Continue to Generate a Strong Return on Their Fertilizer Investment
Corn Growers Continue to Generate a Strong Return on Their Fertilizer Investment Corn Growers’ Margins on Fertilizer $8.00 Potash Input Costs $7.00 $6.00 Corn Crop Potash Cost % of Corn Growers’ Estimated 2009 ($/ton) Input Costs Crop $5.00 2008E $325 2 - 3% 2008 Crop 2009E $875 4 - 6% $4.00 $3.00 –
Slide 49: 2008 Corn Growers’ Margin Model – 74% ROIC
2008 Corn Growers’ Margin Model – 74% ROIC 2008 Estimate of Fertilizer Return on Corn Nutrient lbs/acre Fertilizer lbs/acre Nutrient Product needed needed $/st $/acre $/bushel N Urea 115 249 450 56 0.36 N DAP 25 Total N 140 P DAP 65 141 460 32 0.21 K KCL 50 83 325 13 0.09 Per Acre Per Bushel Total F
Slide 50: 2009 Corn Growers’ Margin Model – 99% ROIC
2009 Corn Growers’ Margin Model – 99% ROIC 2009 Estimate of Fertilizer Return on Corn Nutrient lbs/acre Fertilizer lbs/acre Nutrient Product needed needed $/st $/acre $/bushel N Urea 115 249 285 35 0.23 N DAP 25 Total N 140 P DAP 65 141 525 37 0.24 (1) K KCL 50 83 875 36 0.23 Per Acre Per Bushel Tot