Intrepid Potash, Inc · NYSE:IPI
Intrepid Potash — Investor Presentation (February 2015)
31 slides from Intrepid Potash's investor presentation, Feb 25, 2015
Slide 1: Ingredients for Growth February 2015
Ingredients for Growth February 2015
Slide 2: Safe Harbor
This presentation contains forward-looking statements — that is, statements about future, not past, events. These forward-looking statements often relate to our future performance and management’s expectations for the future, including statements about our financial outlook. Our forward-looking stat
Slide 3: Agenda
Agenda 3 Improved Capital Structure & Long Term Growth Initiatives Creating a Stronger Intrepid Positioned to Increase Margin and Cash Flow Leveraging Low Cost Solar Solution Mining Expertise Optimizing New and Upgraded Assets
Slide 4: Agenda
Agenda 4 Improved Capital Structure & Long Term Growth Initiatives Creating a stronger Intrepid Positioned to Increase Margin and Cash Flow Leveraging Low Cost Solar Solution Mining Expertise Optimizing New and Upgraded Assets
Slide 5: Achieving Premium to North American Peers
Achieving Premium to North American Peers 2014 + 33% * Average net realized sales price per ton is a non-GAAP financial measure calculated as gross sales less freight costs, divided by the number of tons sold in the period. Average net realized sales price advantage is a non-GAAP financial measure c
Slide 6: Maximizing Price and Margin: Serving Diverse Markets
Positioned to Increase Margin and Cash Flow Serving Diverse Markets Strategy is to maximize and sell all of our production Flexibility to react to changes in demand Selling into the highest margin opportunities Participation in specialty market – Trio® Potash Sales Mix Industrial Agricultural Animal
Slide 7: Strong Industry Fundamentals
Balanced fertilization essential to maximizing yields Operating in markets that consume many multiples of Intrepid's production Favorable demand trends from 2014 continued into 2015 7 Positioned to Increase Margin and Cash Flow Strong Industry Fundamentals Record Sales for Intrepid in 2014 Strong po
Slide 8: Agenda
Agenda 8 Improved Capital Structure & Long Term Growth Initiatives Creating a stronger Intrepid Positioned to Increase Margin and Cash Flow Leveraging Low Cost Solar Solution Mining Expertise Optimizing New and Upgraded Assets
Slide 9: Solar Solution Mining Process
Leveraging Low Cost Solar Solution Mining Expertise Solar Solution Mining Process Inject brine into idled or created mine works Allow brine to circulate to dissolve the remaining potash Extract potash enriched brine and pump into solar evaporation pond Allow solar evaporation to occur; potash recrys
Slide 10: Solar Solution Advantages
Leveraging Low Cost Solar Solution Mining Expertise Solar Solution Advantages 10 Capturing previously unrecoverable potash Environmentally friendly Reduced energy use Utilizing non-potable water Beneficial re-use of process water Building on our proven expertise Hard for others to replicate Deposits
Slide 11: Meaningfully Lower Cash Operating Costs
Leveraging Low Cost Solar Solution Mining Expertise Solar Solution Advantages 11 Significant savings on two largest cost inputs, energy and labor Production per employee more than 150% higher than our conventional mining Use solar energy to evaporate in place of fossil fuel Meaningful reserves avail
Slide 12: Incremental Production While Lowering Cash Operating Costs
Conventional Solar ~25% Leveraging Low Cost Solar Solution Mining Expertise Incremental Production While Lowering Cash Operating Costs 12 2013 Conventional Solar grows to ~36% 2016 Solar comprises larger percentage of our total production Solar cash operating costs are at least $100 less than conven
Slide 13: Agenda
Agenda 13 Improved Capital Structure & Long Term Growth Initiatives Creating a stronger Intrepid Positioned to Increase Margin and Cash Flow Leveraging Low Cost Solar Solution Mining Expertise Optimizing New and Upgraded Assets
Slide 14: Completed Projects Driving Flexibility, Growth and Margin
OBJECTIVE Respond to changing demand to pursue highest margin sales Ability to compact 100% of potash Sell more Premium Trio® PROJECTS North compaction Trio® pellet plant OBJECTIVE Increase production Lower costs PROJECTS HB Solar Solution mine Moab solution mining caverns West plant improvements GR
Slide 15: Agenda
Agenda 15 Improved Capital Structure & Long Term Growth Initiatives Creating a stronger Intrepid Positioned to Increase Margin and Cash Flow Leveraging Low Cost Solar Solution Mining Expertise Optimizing New and Upgraded Assets
Slide 16: Balance Sheet Strength
Cash and investments totaling $90 million $250 unsecured credit facility in place through August 2018 $150 million in unsecured long-term debt, average interest rate under 4% First maturity is $60 million in 2020 Generated positive free cash flow* in 2014 Cash flow from operations $127 million Cash
Slide 17: Long Term Growth Focus
OBJECTIVE Incremental solar solution production Lower cash operating costs PROJECTS Additional phases of HB Amax/Horizon Increase Solar Solution Production OBJECTIVE Produce more Trio® PROJECTS Recovery improvements Premium conversion process Grow Trio® Sales OBJECTIVE Lower per ton cash operating c
Slide 18: Why Intrepid?
Why Intrepid? Increased Cash Flow Generation North American Average Net Realized Sales Price Advantage Committed to Lowering Costs Leveraging Solar Solution Expertise Strong Capital Structure Focused on Growth, Flexibility, and Margin Expansion 18
Slide 19: Appendix
Appendix ® Supplying a Growing America® Appendix
Slide 20: Intrepid's Locations
Intrepid’s Locations 20 Moab Solar Solution Mine Carlsbad Assets including: West North East HB Solar Solution Mine Amax/ Horizon (potential Solar Solution development) Florida New Mexico Texas Oklahoma Kansas Nebraska South Dakota Montana Wyoming Colorado Utah Idaho Arizona Nevada Washington Califor
Slide 21: 2015 Outlook
2015 Outlook as of February 18, 2015 21 First-Half Second-Half Full-Year 2015 2015 2015 Potash Production (tons) 390,000 - 410,000 460,000 - 490,000 850,000 - 900,000 Sales (tons) 405,000 - 425,000 425,000 - 445,000 830,000 - 870,000 Cash operating costs ($/ton) $200 - $215 $190 - $205 $195 - $210 T
Slide 22: Financial Overview
Financial Overview Adjusted EBITDA* (in millions) Balance Sheet as of Dec. 31, 2014 Net Income (Loss) (in millions) Diluted Earnings (Loss) Per Share Cash and Investments $ 90 million Current Assets $ 202 million Total Assets $1,167 million Debt Outstanding $ 150 million Total Liabilities $ 219 mill
Slide 23: Non-GAAP Reconciliations
Non-GAAP Reconciliations To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use several non-GAAP financial measures to monitor and evaluate our performance. These non-GAAP financial measures may include adjusted net income (loss), adjust
Slide 24: Non-GAAP Reconciliation: Calculation of Adjusted EBITDA
Non-GAAP Reconciliation Calculation of Adjusted EBITDA Adjusted earnings before interest, taxes, depreciation, and amortization (or adjusted EBITDA) is a non-GAAP financial measure that is calculated as net income adjusted for the change in the allowance associated with the employment-related high w
Slide 25: Non-GAAP Reconciliation: Net Sales and Average Net Realized Sales Price
Non-GAAP Reconciliation Net sales, average net realized sales price, and average net realized sales price advantage are non-GAAP financial measures. Net sales are calculated as sales less freight costs. Average net realized sales price is calculated as net sales, divided by the number of tons sold i
Slide 26: Historical Quarterly Production and Sales
Historical Quarterly Production and Sales 27 Note: One short ton equals 2,000 pounds. One metric tonne, which many international competitors use, equals 1,000 kilograms or 2,204.62 pounds.
Slide 27: U.S. Potash Consumption Remains Steady and Robust
U.S. Potash Consumption Remains Steady and Robust Sources : Fertecon, United States Department of Agriculture (USDA), NOAA National Climatic Data Center. Potash consumption is shown in fertilizer years (July – June). Grains stocks include barley, corn, oats, sorghum and wheat. Potash fertilizer cons
Slide 28: Global Potash Consumption, Production and Capacity
Global Potash Consumption, Prod. & Capacity Demand exceeded Supply in 2008, so theoretical capacity has been challenged in recent years 29
Slide 29: Global Industry Susceptible to Production Interruption and Supply Shocks
Global Industry Susceptible to Production Interruption and Supply “Shocks” Depleted Conventional Mines Mines Currently With Less than 15 Years Reserve Life Theodore, Amelie, Marie Louis mines- France Pasquasi and San Cataldo mines - Italy Salzdetfurth, Friedrichshall, Bergmannssegen-Hugo, Siegfried-
Slide 30: Fundamentals of Increasing Population Continue to Drive Grain and Potash Demand
Fundamentals of Increasing Population Continue to Drive Grain and Ultimately Potash Demand Over the Long Term Note: Grains include corn, wheat, barley, oats and sorghum. Stocks-to-use ratio is ending inventory / consumption for that crop year; data updated monthly. Sources: United Nations Food and A
Slide 31: Investor Relations Contact
For more information visit our website at www.intrepidpotash.com Investor Relations Contact: Gary Kohn Phone 303.996.3024 Email: gary.kohn@intrepidpotash.com
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