Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 17, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Intrepid Potash, Inc. | |
Entity Central Index Key | 1,421,461 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 131,091,493 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and cash equivalents | $ 6,085 | $ 1,068 |
Accounts receivable: | ||
Trade, net | 29,605 | 17,777 |
Other receivables, net | 969 | 762 |
Refundable income taxes | 2,663 | |
Inventory, net | 75,916 | 83,126 |
Prepaid expenses and other current assets | 5,175 | 6,088 |
Total current assets | 117,750 | 111,484 |
Property, plant and equipment, and mineral properties, net | 359,362 | 364,542 |
Long-term parts inventory, net | 31,106 | 30,611 |
Other assets, net | 3,804 | 3,955 |
Total Assets | 512,022 | 510,592 |
Accounts payable: | ||
Trade | 8,262 | 11,103 |
Related parties | 31 | 28 |
Income taxes payable | 180 | |
Accrued liabilities | 8,618 | 8,074 |
Accrued employee compensation and benefits | 3,579 | 4,317 |
Advances on credit facility | 1,500 | 3,900 |
Current portion of long-term debt | 10,000 | 10,000 |
Other current liabilities | 3,746 | 65 |
Total current liabilities | 35,916 | 37,487 |
Long-term debt, net | 49,470 | 49,437 |
Asset retirement obligation | 21,893 | 21,476 |
Other non-current liabilities | 0 | 102 |
Total Liabilities | 107,279 | 108,502 |
Commitments and Contingencies | ||
Common stock, $0.001 par value; 400,000,000 shares authorized; 127,688,437 and 127,646,530 shares outstanding at March 31, 2018, and December 31, 2017, respectively | 128 | 128 |
Additional paid-in capital | 646,709 | 645,813 |
Retained deficit | (242,094) | (243,851) |
Total Stockholders' Equity | 404,743 | 402,090 |
Total Liabilities and Stockholders' Equity | $ 512,022 | $ 510,592 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares outstanding | 127,688,437 | 127,646,530 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Statement [Abstract] | ||
Sales | $ 53,195 | $ 48,655 |
Less: | ||
Freight costs | 9,734 | 8,721 |
Warehousing and handling costs | 2,276 | 2,770 |
Cost of goods sold | 33,280 | 35,873 |
Lower-of-cost-or-market inventory adjustments | 705 | 3,824 |
Gross Margin (Deficit) | 7,200 | (2,533) |
Selling and administrative | 3,970 | 4,404 |
Accretion of asset retirement obligation | 417 | 389 |
Care and maintenance expense | 128 | 692 |
Other operating expense | 168 | 1,650 |
Operating Income (Loss) | 2,517 | (9,668) |
Other Income (Expense) | ||
Interest Expense, net | (878) | (4,421) |
Interest income | 98 | 3 |
Other income | 20 | 413 |
Income (Loss) Before Income Taxes | 1,757 | (13,673) |
Income Tax Expense | (5) | |
Net Income | $ 1,757 | $ (13,678) |
Weighted Average Shares Outstanding: | ||
Basic (in shares) | 127,661,458 | 81,992,071 |
Diluted (in shares) | 130,764,998 | 81,992,071 |
Earnings (Loss) Per Share: | ||
Basic (in dollars per share) | $ 0.01 | $ (0.17) |
Diluted (in dollars per share) | $ 0.01 | $ (0.17) |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] |
Increase (Decrease) in Stockholders' Equity | ||||
Adjustment to opening balance | Accounting Standards Update 2014-09 [Member] | $ (500) | |||
Balance (in shares) at Dec. 31, 2017 | 127,646,530 | |||
Balance at Dec. 31, 2017 | $ 402,090 | $ 128 | $ 645,813 | (243,851) |
Increase (Decrease) in Stockholders' Equity | ||||
Net Income (Loss) | 1,757 | |||
Stock-based compensation | 947 | 947 | ||
Vesting of restricted common stock, net of restricted common stock used to fund employee income tax withholding due upon vesting (in shares) | 30,708 | |||
Adjustments related to tax withholding for share-based compensation | (62) | (62) | ||
Exercise of stock options (in shares) | 11,199 | |||
Exercise of stock options | 11 | 11 | ||
Balance (in shares) at Mar. 31, 2018 | 127,688,437 | |||
Balance at Mar. 31, 2018 | $ 404,743 | $ 128 | $ 646,709 | $ (242,094) |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Reconciliation of net income to net cash provided by operating activities: | |||
Net Income (Loss) | $ 1,757 | $ (13,678) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation, depletion and accretion | [1] | 8,932 | 9,323 |
Amortization of deferred financing costs | 183 | 821 | |
Stock-based compensation | 947 | 989 | |
Lower-of-cost-or-market inventory adjustments | 705 | 3,824 | |
(Gain) loss on disposal of assets | (34) | 1,559 | |
Changes in operating assets and liabilities: | |||
Trade accounts receivable, net | (11,828) | (8,776) | |
Other receivables, net | (207) | (399) | |
Refundable income taxes | 2,844 | (4) | |
Inventory, net | 6,009 | 1,643 | |
Prepaid expenses and other current assets | 914 | 3,872 | |
Accounts payable, accrued liabilities, and accrued employee compensation and benefits | 1 | (64) | |
Other liabilities | 3,681 | (819) | |
Net cash provided by (used in) operating activities | 13,904 | (1,709) | |
Cash Flows from Investing Activities: | |||
Additions to property, plant, equipment, and mineral properties | (6,470) | (2,423) | |
Proceeds from sale of property, plant, equipment, and mineral properties | 34 | 5,553 | |
Net cash (used in) provided by investing activities | (6,436) | 3,130 | |
Cash Flows from Financing Activities: | |||
Issuance of common stock, net of transaction costs | 57,468 | ||
Repayments of long-term debt | (46,000) | ||
Proceeds from short-term borrowings on credit facility | 13,500 | ||
Repayments of short-term borrowings on credit facility | (15,900) | ||
Employee tax withholding paid for restricted stock upon vesting | (62) | (109) | |
Proceeds from exercise of stock options | 11 | ||
Net cash (used in) provided by financing activities | (2,451) | 11,359 | |
Net Change in Cash, Cash Equivalents and Restricted Cash | 5,017 | 12,780 | |
Cash, Cash Equivalents, and Restricted Cash, beginning of period | 1,549 | 8,470 | |
Cash, Cash Equivalents, and Restricted Cash, end of period | 6,566 | 21,250 | |
Net cash paid (refunded) during the period for: | |||
Interest | 95 | 2,467 | |
Income taxes | (2,843) | 10 | |
Accrued purchases for property, plant, equipment, and mineral properties | $ 933 | $ 214 | |
[1] | Depreciation, depletion and accretion incurred for potash and Trio® excludes depreciation, depletion and accretion amounts absorbed in or relieved from inventory. |
COMPANY BACKGROUND
COMPANY BACKGROUND | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
COMPANY BACKGROUND | COMPANY BACKGROUND We are the only producer of muriate of potash ("potassium chloride" or "potash") in the United States and are one of two producers of langbeinite ("sulfate of potash magnesia"), which we market and sell as Trio ® . We sell potash and Trio ® primarily into the agricultural market as a fertilizer. We also sell these products into the animal feed market as a nutritional supplement and sell potash into the industrial market as a component in drilling and fracturing fluids for oil and gas wells and other industrial inputs. We also sell water, primarily for industrial uses such as in the oil and gas industry. In addition, we sell by-products including salt, magnesium chloride, and brine, which are recorded as a credit to cost of goods sold. These by-product credits represented approximately 9% of total cost of goods sold for the three months ended March 31, 2018 . We produce potash from three solution mining facilities: our HB solar solution mine in Carlsbad, New Mexico, our solar solution mine in Moab, Utah, and our solar brine recovery mine in Wendover, Utah. We also operate the North compaction facility in Carlsbad, New Mexico, which compacts and granulates product from the HB mine. We produce Trio ® from our conventional underground East mine in Carlsbad, New Mexico. "Intrepid," "our," "we," or "us," means Intrepid Potash, Inc. and its consolidated subsidiaries. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Financial Statement Presentation —Our unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to those rules and regulations. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation of interim financial information, have been included. These condensed consolidated financial statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2017, as filed with the SEC on February 27, 2018. Except for the accounting policies for revenue recognition that were updated as a result of adopting Accounting Standards Codification ("ASC") "Revenue from Contracts with Customers" ("ASC Topic 606"), there have been no changes to our significant accounting policies described in our Annual Report on Form 10-K for the year ended December 31, 2017. Revenue Recognition —The majority of our revenue is derived from contract sales that are of a short-term nature. We account for revenue in accordance with ASC Topic 606, which we adopted on January 1, 2018, using the full retrospective method. Comparative information has been adjusted as if ASC Topic 606 was in effect during the comparative period. See Note 16 for further discussion of the adoptions, including the retrospective adjustment made to our 2017 financial statements. Performance Obligations: A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC Topic 606. The contract's transaction price is allocated to the performance obligations and recognized as revenue when the performance obligations are satisfied. Generally, our performance obligations are satisfied when we ship product from our facility to the customer. Shipping and handling charges are accounted for as a fulfillment cost and, as such, are not considered to be a separate performance obligation. Revenue from sales to customers at a single point in time accounted for all our revenue for both the three-month periods ended March 31, 2018, and 2017. Contract Estimates: In certain circumstances, we may sell product to customers where the sales price is variable. For such sales, we estimate the sales price we expect to realize based on the facts and circumstances for each sale, including historical experience, and recognize revenue to the extent it is probable that a subsequent change in estimate will not result in a significant revenue reversal compared to the cumulative revenue recognized under the contract. Contract Balances: The timing of revenue recognition, billings and cash collection may result in contract assets or contract liabilities. For certain contracts, the customer has agreed to pay us before we have satisfied our performance obligations. Customer payments received before we have satisfied our performance obligations are accounted for as a contract liability. As of March 31, 2018, and December 31, 2017, we had $3.7 million and $0.0 million in contract liabilities, respectively. Because we had no contract liabilities at December 31, 2017, we did not recognize any revenue from the beginning contract liability balance during the three months ended March 31, 2018. Disaggregation of Revenue: In the following table, revenue is disaggregated by our primary products. March 31, 2018 Product (amounts in thousands) Revenue Timing of revenue recognition Potash $ 27,064 Point in time Trio 21,237 Point in time Water 4,894 Point in time Total $ 53,195 March 31, 2017 Product (amounts in thousands) Revenue Timing of revenue recognition Potash $ 27,220 Point in time Trio 21,112 Point in time Water 323 Point in time Total $ 48,655 Reclassifications of Prior Period Presentation —Certain prior period amounts have been reclassified in order to conform to the current period presentation. These reclassifications had no effect on the reported results of operations. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | PER SHARE Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period. For purposes of determining diluted earnings per share, basic weighted-average common shares outstanding are adjusted to include potentially dilutive securities, including restricted stock, stock options, and performance units. The treasury-stock method is used to measure the dilutive impact of potentially dilutive shares. Potentially dilutive shares are excluded from the diluted weighted-average shares outstanding computation in periods in which they have an anti-dilutive effect. The following table shows the calculation of basic and diluted earnings (loss) per share (in thousands, except per share amounts): Three Months Ended March 31, 2018 2017 Net income (loss) $ 1,757 $ (13,678 ) Basic weighted average common shares outstanding 127,661 81,992 Add: Dilutive effect of restricted stock 2,184 — Add: Dilutive effect of stock options 920 — Diluted weighted average common shares outstanding 130,765 81,992 Basic $ 0.01 $ (0.17 ) Diluted $ 0.01 $ (0.17 ) The following table shows the shares that have an anti-dilutive effect and are excluded from the diluted weighted-average shares outstanding computations: Three Months Ended March 31, 2018 2017 Anti-dilutive effect of restricted stock — 3,399 Anti-dilutive effect of stock options outstanding 545 1,866 Anti-dilutive effect of performance units — 63 |
CASH, CASH EQUIVALENTS AND REST
CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 3 Months Ended |
Mar. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH | Note 4 — CASH, CASH EQUIVALENTS AND RESTRICTED CASH Cash, cash equivalents and restricted cash are included in the following accounts at March 31, 2018 and 2017: March 31, 2018 March 31, 2017 Cash and cash equivalents $ 6,085 $ 20,770 Restricted cash included in other long-term assets 481 480 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 6,566 $ 21,250 Restricted cash included in other long-term assets on the balance sheet represents amounts whose use is restricted by contractual agreements with the Bureau of Land Management and the State of Utah as security to fund future reclamation obligations at our sites. |
INVENTORY AND LONG-TERM PARTS I
INVENTORY AND LONG-TERM PARTS INVENTORY | 3 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
INVENTORY AND LONG-TERM PARTS INVENTORY | The following summarizes our inventory, recorded at the lower of weighted-average cost or estimated net realizable value, as of March 31, 2018 , and December 31, 2017 (in thousands): March 31, 2018 December 31, 2017 Finished goods product inventory $ 51,872 $ 54,577 In-process mineral inventory 15,837 19,822 Total product inventory 67,709 74,399 Current parts inventory, net 8,207 8,727 Total current inventory, net 75,916 83,126 Long-term parts inventory, net 31,106 30,611 Total inventory, net $ 107,022 $ 113,737 Parts inventories are shown net of any required allowances. At March 31, 2018 , and December 31, 2017 , allowances for parts inventory obsolescence were $3.6 million and $4.2 million . During the three months ended March 31, 2018, and 2017 , we recorded charges of approximately $0.7 million and $3.8 million , respectively, as a result of routine assessments of the lower of weighted-average cost or estimated net realizable value of our finished goods product inventory. |
PROPERTY, PLANT, EQUIPMENT, AND
PROPERTY, PLANT, EQUIPMENT, AND MINERAL PROPERTIES | 3 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT, EQUIPMENT, AND MINERAL PROPERTIES | PROPERTY, PLANT, EQUIPMENT, AND MINERAL PROPERTIES Property, plant, equipment, and mineral properties were comprised of the following (in thousands): March 31, 2018 December 31, 2017 Buildings and plant $ 80,343 $ 79,757 Machinery and equipment 236,605 234,861 Vehicles 5,121 4,835 Office equipment and improvements 13,516 12,637 Ponds and land improvements 57,986 56,194 Total depreciable assets $ 393,571 $ 388,284 Accumulated depreciation (148,255 ) (141,818 ) Total depreciable assets, net $ 245,316 $ 246,466 Mineral properties and development costs $ 138,880 $ 138,841 Accumulated depletion (28,436 ) (26,840 ) Total depletable assets, net $ 110,444 $ 112,001 Land $ 519 $ 519 Construction in progress $ 3,083 $ 5,556 Total property, plant, equipment, and mineral properties, net $ 359,362 $ 364,542 We incurred the following expenses for depreciation, depletion, and accretion, including expenses capitalized into inventory, for the following periods (in thousands): Three Months Ended March 31, 2018 2017 Depreciation $ 6,919 $ 7,160 Depletion 1,596 1,774 Accretion 417 389 Total incurred $ 8,932 $ 9,323 |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
DEBT | Notes —As of March 31, 2018 , we had outstanding $60 million of senior notes (the "Notes") consisting of the following series: • $24 million of Senior Notes, Series A, due April 16, 2020 • $18 million of Senior Notes, Series B, due April 14, 2023 • $18 million of Senior Notes, Series C, due April 16, 2025 We are required to prepay $10 million in principal of the Notes, plus accrued interest and a make-whole amount, on or before December 31, 2018. The agreement governing the Notes contains certain financial covenants, including the following: • For the twelve months ended March 31, 2018, we were required to maintain a minimum adjusted EBITDA of negative $7.5 million . We met this covenant with adjusted EBITDA of $37.0 million for the trailing twelve months ended March 31, 2018. • For the quarters ending June 30, 2018, and September 30, 2018, we are required to maintain a minimum fixed charge coverage amount of negative $15 million and negative $10 million , respectively. Thereafter, we are required to maintain a minimum fixed charge coverage ratio that starts at 0.25 to 1.0 for the quarter ending December 31, 2018, and increases to 1.3 to 1.0 for each quarter ending on or after September 30, 2019. As of March 31, 2018, our fixed charge coverage amount was $15.7 million , and our fixed charge coverage ratio was 3.78 to 1.0. • We are required to maintain a maximum leverage ratio that starts at 11.5 to 1.0 for the quarter ending June 30, 2018, and decreases each quarter until it reaches 3.5 to 1.0 for each quarter ending on or after September 30, 2019. As of March 31, 2018, our leverage ratio was 1.66 to 1.0. Adjusted EBITDA is a non-GAAP measure. Adjusted EBITDA, fixed charge coverage amount, fixed charge coverage ratio, and leverage ratio are calculated in accordance with the agreement governing the Notes. For the three months ended March 31, 2018, the interest rates on the Notes were 3.73% for the Series A Notes, 4.63% for the Series B Notes and 4.78% for the Series C Notes. These rates represent the lowest interest rates available under the Notes. The interest rates may adjust upward if we do not continue to meet certain financial covenants. We have granted to the collateral agent for the noteholders a first lien on substantially all of our non-current assets and second lien on substantially all of our current assets. We are required to offer to prepay the Notes with the proceeds of dispositions of certain specified property and with the proceeds of certain equity issuances, as set forth in the agreement. The obligations under the Notes are unconditionally guaranteed by several of our subsidiaries. We were in compliance with the applicable covenants under the agreement governing the Notes as of March 31, 2018 . Our outstanding long-term debt, net, as of March 31, 2018 , and December 31, 2017 , is as follows (in thousands): March 31, 2018 December 31, 2017 Senior Notes $ 60,000 $ 60,000 Less current portion of long-term debt (10,000 ) (10,000 ) Less deferred financing costs (530 ) (563 ) Long-term debt, net $ 49,470 $ 49,437 Credit Facility —We maintain an asset-based revolving credit facility with Bank of Montreal that matures on October 31, 2019. The credit facility allows us to borrow up to $35 million subject to monthly limits based on our inventory and receivables. We can use up to $10 million of borrowings under the agreement to make payments on the Notes. Borrowings on the credit facility bear interest at 1.75% to 2.25% above LIBOR (London Interbank Offered Rate), based on average availability under the credit facility. We have granted to Bank of Montreal a first lien on substantially all of our current assets and a second lien on substantially all of our non-current assets. We regularly borrow and repay amounts under the facility for near-term working capital needs and may do so in the future. For the three months ended March 31, 2018, we borrowed $13.5 million and repaid $15.9 million under the facility. As of March 31, 2018, we had $1.5 million of borrowings outstanding and $2.1 million in outstanding letters of credit under the facility. Considering the outstanding borrowings and letters of credit, we have $31.4 million available under the facility as of March 31, 2018. We were in compliance with the applicable covenants under the facility as of March 31, 2018. Interest expense is recorded net of any capitalized interest associated with investments in capital projects. We incurred gross interest expense of $0.9 million and $4.5 million for the three months ended March 31, 2018 , and 2017 , respectively. Amounts included in interest expense for the three months ended March 31, 2018 , and 2017, are as follows (in thousands): Three Months Ended March 31, 2018 2017 Interest on Notes and credit facility $ 749 $ 2,836 Make-whole payments — 794 Amortization of deferred financing costs 183 821 Gross interest expense 932 4,451 Less capitalized interest (54 ) (30 ) Interest expense, net $ 878 $ 4,421 |
FINANCIAL INFORMATION FOR SUBSI
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS OF POSSIBLE FUTURE PUBLIC DEBT | 3 Months Ended |
Mar. 31, 2018 | |
Guarantees [Abstract] | |
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS OF POSSIBLE FUTURE PUBLIC DEBT | Intrepid Potash, Inc., as the parent company, has no independent assets or operations, and operations are conducted solely through its subsidiaries. Cash generated from operations is held at the parent-company level as cash on hand and totaled $6.1 million and $1.1 million at March 31, 2018 , and December 31, 2017 , respectively. If one or more of our wholly-owned operating subsidiaries guarantee public debt securities in the future, those guarantees will be full and unconditional and will constitute the joint and several obligations of the subsidiary guarantors. Our other subsidiaries are minor. There are no restrictions on our ability to obtain cash dividends or other distributions of funds from the subsidiary guarantors, except those imposed by applicable law. |
ASSET RETIREMENT OBLIGATION
ASSET RETIREMENT OBLIGATION | 3 Months Ended |
Mar. 31, 2018 | |
Asset Retirement Obligation Disclosure [Abstract] | |
ASSET RETIREMENT OBLIGATION | We recognize an estimated liability for future costs associated with the abandonment and reclamation of our mining properties. A liability for the fair value of an asset retirement obligation and a corresponding increase to the carrying value of the related long-lived asset are recorded as the mining operations occur or the assets are acquired. Our asset retirement obligation is based on the estimated cost to abandon and reclaim the mining operations, the economic life of the properties, and federal and state regulatory requirements. The liability is discounted using credit adjusted risk-free rate estimates at the time the liability is incurred or when there are upward revisions to estimated costs. The credit adjusted risk-free rates used to discount our abandonment liabilities range from 6.9% to 9.7% . Revisions to the liability occur due to construction of new or expanded facilities, changes in estimated abandonment costs or economic lives, or if federal or state regulators enact new requirements regarding the abandonment or reclamation of mines. Following is a table of the changes to our asset retirement obligation for the following periods (in thousands): Three Months Ended March 31, 2018 2017 Asset retirement obligation, at beginning of period $ 21,476 $ 19,976 Accretion of discount 417 389 Total asset retirement obligation, at end of period $ 21,893 $ 20,365 The undiscounted amount of asset retirement obligation was $59.5 million as of March 31, 2018 . |
COMMON STOCK
COMMON STOCK | 3 Months Ended |
Mar. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Common Stock | In May 2017, we established an at-the-market offering program, which gives us the capacity to issue up to $40 million of our common stock. We sold no shares under the at-the-market offering program during the first quarter of 2018. |
COMPENSATION PLANS
COMPENSATION PLANS | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
COMPENSATION PLANS | Equity Incentive Compensation Plan —Our Board of Directors and stockholders adopted a long-term incentive compensation plan called the Intrepid Potash, Inc. Amended and Restated Equity Incentive Plan (the "Plan"). We have issued common stock, restricted stock, performance units, and non-qualified stock option awards under the Plan. At March 31, 2018, there were approximately 2.3 million shares available for issuance under the Plan. For the three months ended March 31, 2018, we granted 0.4 million shares of restricted stock and 1.6 million non-qualified stock options to executive officers, and other key employees. These awards vest over one to three years, and in some cases, contain performance vesting conditions or market conditions. As of March 31, 2018, the following awards were outstanding under the Plan: Outstanding as of March 31, 2018 Restricted Stock 3,403,056 Non-qualified Stock Options 3,594,592 Total share-based compensation expense was $0.9 million and $1.0 million for the three months ended March 31, 2018, and 2017, respectively. As of March 31, 2018 , we had $9.5 million of total remaining unrecognized compensation expense related to awards, that will be expensed through 2020. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | ipated annual tax rate is impacted primarily by the amount of taxable income associated with each jurisdiction in which our income is subject to income tax, permanent differences between the financial statement carrying amounts and tax bases of assets and liabilities. During the three months ended March 31, 2018 , and March 31, 2017, we incurred an immaterial amount of income tax expense. Our effective tax rate was 0% for the three months ended March 31, 2018, and 2017, which differed from the statutory rate primarily due to the valuation allowance established to offset our deferred tax assets As of March 31, 2018 , we do not believe it is more likely than not that we will fully realize the benefit of our deferred tax assets. As such, we recognized a full valuation allowance against our net deferred tax assets as of March 31, 2018 , and December 31, 2017 . |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | Reclamation Deposits and Surety Bonds —As of March 31, 2018 , and December 31, 2017 , we had $18.8 million of security placed principally with the State of Utah and the Bureau of Land Management for eventual reclamation of our various facilities. Of this total requirement, as of March 31, 2018 , and December 31, 2017 , $0.5 million consisted of long-term restricted cash deposits reflected in "Other assets, net" on the condensed consolidated balance sheets and $18.3 million was secured by surety bonds issued by an insurer. The surety bonds are held in place by an annual fee paid to the issuer. We may be required to post additional security to fund future reclamation obligations as reclamation plans are updated or as governmental entities change requirements. Legal —In February 2015, Mosaic Potash Carlsbad Inc. (“Mosaic”) filed a complaint and application for preliminary injunction and permanent injunction against Steve Gamble and us in the Fifth Judicial District Court for the County of Eddy in the State of New Mexico. In August 2015, the court denied Mosaic’s application for preliminary injunction. In July 2016, Mosaic filed a second complaint against Mr. Gamble and us in US District Court for the District of New Mexico. In January 2018, the two lawsuits were consolidated into one lawsuit pending in the US District Court for the District of New Mexico. Mr. Gamble is a former employee of Intrepid and Mosaic. Mosaic alleges against us violations of the New Mexico Uniform Trade Secrets Act, tortious interference with contract relating to Mr. Gamble’s separation of employment from Mosaic, violations of the Computer Fraud and Abuse Act, conversion, and civil conspiracy relating to the alleged misappropriation of Mosaic’s confidential information and related actions. Mosaic seeks monetary relief of an unspecified amount, including damages for actual loss and unjust enrichment, exemplary damages, attorneys’ fees, and injunctive relief and has alleged that it has spent hundreds of millions of dollars to research and develop its alleged trade secrets. The lawsuit is progressing through discovery. We are vigorously defending against the lawsuit. Because this matter is at an early stage, we are unable to reasonably estimate the potential amount of loss, if any. We are subject to other claims and legal actions in the ordinary course of business. Legal costs are expensed as incurred. While there are uncertainties in predicting the outcome of any claim or legal action, we believe that the ultimate resolution of these other claims or actions is not reasonably likely to have a material adverse effect on our financial condition, results of operations, or cash flows. Future Operating Lease Commitments —We have operating leases for land, mining and other operating equipment, offices, and railcars, with original terms ranging up to 30 years. Rental and lease expenses for the three months ended March 31, 2018 , and 2017, were $1.0 million and $1.5 million , respectively. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | We measure our financial assets and liabilities in accordance with Accounting Standards Codification™ ("ASC") Topic 820, Fair Value Measurements and Disclosures. As of March 31, 2018 , and December 31, 2017 , our cash consisted of bank deposits. Other financial assets and liabilities including accounts receivable, refundable income taxes, accounts payable, accrued liabilities, and advances on credit facility are carried at cost which approximates fair value because of the short-term nature of these instruments. As of March 31, 2018 , and December 31, 2017 , the estimated fair value of our outstanding Notes was $56 million and $58.8 million , respectively. The fair value of our Notes is estimated using a discounted cash flow analysis based on current borrowing rates for debt with similar remaining maturities and ratings (a Level 2 input) and is designed to approximate the amount at which the instruments could be exchanged in an arm's-length transaction between knowledgeable willing parties. |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | two business segments: potash and Trio ® . Our reportable segments are determined by management based on a number of factors including the types of potassium-based fertilizer produced, production processes, markets served and the financial information available to our chief operating decision maker. We evaluate performance based on the gross margins of the respective business segments and do not allocate corporate selling and administrative expenses, among others, to the respective segments. Total assets are not presented for each reportable segment as they are not reviewed by, nor otherwise regularly provided to, the chief operating decision maker. All sales are to external customers. Water sales and corporate expenses are included in "Other." Information for each segment is provided in the following tables (in thousands): Three Months Ended March 31, 2018 Potash Trio ® Other Consolidated Sales $ 27,064 $ 21,237 $ 4,894 $ 53,195 Less: Freight costs 3,458 6,276 — 9,734 Warehousing and handling costs 1,154 1,118 4 2,276 Cost of goods sold 17,476 15,216 588 33,280 Lower-of-cost-or-market inventory — 705 — 705 Gross Margin (Deficit) $ 4,976 $ (2,078 ) $ 4,302 $ 7,200 Depreciation, depletion and accretion incurred 1 $ 7,138 $ 1,690 $ 104 $ 8,932 Three Months Ended March 31, 2017 Potash Trio ® Other Consolidated Sales $ 27,220 $ 21,112 $ 323 $ 48,655 Less: Freight costs 2,959 5,762 — 8,721 Warehousing and handling costs 1,512 1,258 — 2,770 Cost of goods sold 20,421 15,452 — 35,873 Lower-of-cost-or-market inventory — 3,824 — 3,824 Gross Margin (Deficit) $ 2,328 $ (5,184 ) $ 323 $ (2,533 ) Depreciation, depletion and accretion incurred 1 $ 7,563 $ 1,699 $ 61 $ 9,323 1 Depreciation, depletion and accretion incurred for potash and Trio ® excludes depreciation, depletion and accretion amounts absorbed in or relieved from inventory. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2018 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | PTED ACCOUNTING PRONOUNCEMENTS In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, as amended by ASU No. 2016-12, "Revenue from Contracts with Customers (Topic 606)," which requires revenue to be recognized based on the amount an entity is expected to be entitled to for promised goods or services provided to customers. The standard also requires expanded disclosures regarding contracts with customers. This standard became effective for us beginning January 1, 2018. Our revenue predominantly continues to be recognized when products are shipped from our manufacturing facilities. Under the new revenue standard, certain sales where revenue was previously deferred, such as sales in which the final price was not fixed and determinable, we now recognize revenue when the product is shipped using the sales price we expect to realize. In conjunction with our adoption of Topic 606 on January 1, 2018, primarily related to variable pricing contracts, we recorded a net increase to opening retained deficit of $0.5 million . In August 2016, the FASB issued ASU No. 2016-15, "Statement of Cash Flows (Topic 230)" which is intended to clarify and align how certain cash receipts and cash payments are presented and classified in the statement of cash flows where there is currently diversity in practice. ASU No. 2016-15 specifically addresses eight classification issues within the statement of cash flows including debt prepayments or debt extinguishment costs; proceeds from the settlement of insurance claims; and separately identifiable cash flows and application of the predominance principle. This standard became effective for us beginning January 1, 2018. The adoption of this standard did not have a material impact on our condensed consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16, "Income Taxes (Topic 740)" which became effective for us beginning January 1, 2018. This standard requires us to recognize at the transaction date the income tax consequences of intercompany asset transfers other than inventory. The adoption of this standard did not have a material impact on our consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash" which became effective for us beginning January 1, 2018. This standard requires us to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows and will no longer require transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. As a result of including restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of period total amounts presented on the condensed consolidated state of cash flows, net cash flows for the three months ended March 31, 2017, decreased by $3.5 million . Pronouncements Issued But Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)," which requires, among other things, lessees to recognize lease assets and liabilities on their balance sheets for those leases classified as operating leases under previous generally accepted accounting principles. These assets and liabilities must be recorded generally at the present value of the contracted lease payments, and the cost of the lease must be allocated over the lease term on a straight-line basis. This guidance is effective for us for annual and interim periods in fiscal years beginning after December 15, 2018, with a modified retrospective transition method mandated. Our mineral leases are exempt from the new standard. We do not believe the adoption of this new standard will have a material impact on our consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments - (Topic 326): Measurement of Credit Losses on Financial Instruments," which changes the way entities recognize impairment of many financial assets by requiring immediate recognition of estimated credit losses expected to occur over their remaining life. This guidance is effective for us for annual and interim periods in fiscal years beginning after December 15, 2018. Because we have historically experienced immaterial bad debt expense related to our trade receivables, we do not believe the adoption of this new standard will have a material impact on our consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Financial Statement Presentation | Our unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to those rules and regulations. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation of interim financial information, have been included. These condensed consolidated financial statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2017, as filed with the SEC on February 27, 2018. Except for the accounting policies for revenue recognition that were updated as a result of adopting Accounting Standards Codification ("ASC") "Revenue from Contracts with Customers" ("ASC Topic 606"), there have been no changes to our significant accounting policies described in our Annual Report on Form 10-K for the year ended December 31, 2017. |
Revenue Recognition | The majority of our revenue is derived from contract sales that are of a short-term nature. We account for revenue in accordance with ASC Topic 606, which we adopted on January 1, 2018, using the full retrospective method. Comparative information has been adjusted as if ASC Topic 606 was in effect during the comparative period. See Note 16 for further discussion of the adoptions, including the retrospective adjustment made to our 2017 financial statements. |
Performance Obligation | A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC Topic 606. The contract's transaction price is allocated to the performance obligations and recognized as revenue when the performance obligations are satisfied. Generally, our performance obligations are satisfied when we ship product from our facility to the customer. Shipping and handling charges are accounted for as a fulfillment cost and, as such, are not considered to be a separate performance obligation. Revenue from sales to customers at a single point in time accounted for all our revenue for both the three-month periods ended March 31, 2018, and 2017. |
Contract Estimates | In certain circumstances, we may sell product to customers where the sales price is variable. For such sales, we estimate the sales price we expect to realize based on the facts and circumstances for each sale, including historical experience, and recognize revenue to the extent it is probable that a subsequent change in estimate will not result in a significant revenue reversal compared to the cumulative revenue recognized under the contract. |
Contract Balances | The timing of revenue recognition, billings and cash collection may result in contract assets or contract liabilities. For certain contracts, the customer has agreed to pay us before we have satisfied our performance obligations. Customer payments received before we have satisfied our performance obligations are accounted for as a contract liability. As of March 31, 2018, and December 31, 2017, we had $3.7 million and $0.0 million in contract liabilities, respectively. Because we had no contract liabilities at December 31, 2017, we did not recognize any revenue from the beginning contract liability balance during the three months ended March 31, 2018. |
Disaggregation of Revenue | In the following table, revenue is disaggregated by our primary products. March 31, 2018 Product (amounts in thousands) Revenue Timing of revenue recognition Potash $ 27,064 Point in time Trio 21,237 Point in time Water 4,894 Point in time Total $ 53,195 March 31, 2017 Product (amounts in thousands) Revenue Timing of revenue recognition Potash $ 27,220 Point in time Trio 21,112 Point in time Water 323 Point in time Total $ 48,655 |
Reclassifications of Prior Period Presentation | Certain prior period amounts have been reclassified in order to conform to the current period presentation. These reclassifications had no effect on the reported results of operations. |
SUMMARY OF SIGNIFICANT POLICIES
SUMMARY OF SIGNIFICANT POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Disaggregation of Revenue: In the following table, revenue is disaggregated by our primary products. March 31, 2018 Product (amounts in thousands) Revenue Timing of revenue recognition Potash $ 27,064 Point in time Trio 21,237 Point in time Water 4,894 Point in time Total $ 53,195 March 31, 2017 Product (amounts in thousands) Revenue Timing of revenue recognition Potash $ 27,220 Point in time Trio 21,112 Point in time Water 323 Point in time Total $ 48,655 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Basic and Diluted Loss or Earnings Per Share | Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period. For purposes of determining diluted earnings per share, basic weighted-average common shares outstanding are adjusted to include potentially dilutive securities, including restricted stock, stock options, and performance units. The treasury-stock method is used to measure the dilutive impact of potentially dilutive shares. Potentially dilutive shares are excluded from the diluted weighted-average shares outstanding computation in periods in which they have an anti-dilutive effect. The following table shows the calculation of basic and diluted earnings (loss) per share (in thousands, except per share amounts): Three Months Ended March 31, 2018 2017 Net income (loss) $ 1,757 $ (13,678 ) Basic weighted average common shares outstanding 127,661 81,992 Add: Dilutive effect of restricted stock 2,184 — Add: Dilutive effect of stock options 920 — Diluted weighted average common shares outstanding 130,765 81,992 Basic $ 0.01 $ (0.17 ) Diluted $ 0.01 $ (0.17 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table shows the shares that have an anti-dilutive effect and are excluded from the diluted weighted-average shares outstanding computations: Three Months Ended March 31, 2018 2017 Anti-dilutive effect of restricted stock — 3,399 Anti-dilutive effect of stock options outstanding 545 1,866 Anti-dilutive effect of performance units — 63 |
CASH, CASH EQUIVALENTS AND RE26
CASH, CASH EQUIVALENTS AND RESTRICTED CASH (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents And Restricted Cash | Cash, cash equivalents and restricted cash are included in the following accounts at March 31, 2018 and 2017: March 31, 2018 March 31, 2017 Cash and cash equivalents $ 6,085 $ 20,770 Restricted cash included in other long-term assets 481 480 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 6,566 $ 21,250 |
INVENTORY AND LONG-TERM PARTS27
INVENTORY AND LONG-TERM PARTS INVENTORY (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Summary of Inventory | The following summarizes our inventory, recorded at the lower of weighted-average cost or estimated net realizable value, as of March 31, 2018 , and December 31, 2017 (in thousands): March 31, 2018 December 31, 2017 Finished goods product inventory $ 51,872 $ 54,577 In-process mineral inventory 15,837 19,822 Total product inventory 67,709 74,399 Current parts inventory, net 8,207 8,727 Total current inventory, net 75,916 83,126 Long-term parts inventory, net 31,106 30,611 Total inventory, net $ 107,022 $ 113,737 |
PROPERTY, PLANT, EQUIPMENT, A28
PROPERTY, PLANT, EQUIPMENT, AND MINERAL PROPERTIES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant, Equipment, and Mineral Properties | Property, plant, equipment, and mineral properties were comprised of the following (in thousands): March 31, 2018 December 31, 2017 Buildings and plant $ 80,343 $ 79,757 Machinery and equipment 236,605 234,861 Vehicles 5,121 4,835 Office equipment and improvements 13,516 12,637 Ponds and land improvements 57,986 56,194 Total depreciable assets $ 393,571 $ 388,284 Accumulated depreciation (148,255 ) (141,818 ) Total depreciable assets, net $ 245,316 $ 246,466 Mineral properties and development costs $ 138,880 $ 138,841 Accumulated depletion (28,436 ) (26,840 ) Total depletable assets, net $ 110,444 $ 112,001 Land $ 519 $ 519 Construction in progress $ 3,083 $ 5,556 Total property, plant, equipment, and mineral properties, net $ 359,362 $ 364,542 |
Schedule of Depreciation, Depletion and Accretion | We incurred the following expenses for depreciation, depletion, and accretion, including expenses capitalized into inventory, for the following periods (in thousands): Three Months Ended March 31, 2018 2017 Depreciation $ 6,919 $ 7,160 Depletion 1,596 1,774 Accretion 417 389 Total incurred $ 8,932 $ 9,323 |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long Term Debt | Our outstanding long-term debt, net, as of March 31, 2018 , and December 31, 2017 , is as follows (in thousands): March 31, 2018 December 31, 2017 Senior Notes $ 60,000 $ 60,000 Less current portion of long-term debt (10,000 ) (10,000 ) Less deferred financing costs (530 ) (563 ) Long-term debt, net $ 49,470 $ 49,437 |
Schedule Of Interest Expense | Amounts included in interest expense for the three months ended March 31, 2018 , and 2017, are as follows (in thousands): Three Months Ended March 31, 2018 2017 Interest on Notes and credit facility $ 749 $ 2,836 Make-whole payments — 794 Amortization of deferred financing costs 183 821 Gross interest expense 932 4,451 Less capitalized interest (54 ) (30 ) Interest expense, net $ 878 $ 4,421 |
ASSET RETIREMENT OBLIGATION (Ta
ASSET RETIREMENT OBLIGATION (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Asset Retirement Obligation Disclosure [Abstract] | |
Schedule of Changes to Asset Retirement Obligation | Following is a table of the changes to our asset retirement obligation for the following periods (in thousands): Three Months Ended March 31, 2018 2017 Asset retirement obligation, at beginning of period $ 21,476 $ 19,976 Accretion of discount 417 389 Total asset retirement obligation, at end of period $ 21,893 $ 20,365 |
COMPENSATION PLANS (Tables)
COMPENSATION PLANS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Outstanding Share Based Awards | For the three months ended March 31, 2018, we granted 0.4 million shares of restricted stock and 1.6 million non-qualified stock options to executive officers, and other key employees. These awards vest over one to three years, and in some cases, contain performance vesting conditions or market conditions. As of March 31, 2018, the following awards were outstanding under the Plan: Outstanding as of March 31, 2018 Restricted Stock 3,403,056 Non-qualified Stock Options 3,594,592 |
BUSINES SEGMENTS (Tables)
BUSINES SEGMENTS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Information for each segment is provided in the following tables (in thousands): Three Months Ended March 31, 2018 Potash Trio ® Other Consolidated Sales $ 27,064 $ 21,237 $ 4,894 $ 53,195 Less: Freight costs 3,458 6,276 — 9,734 Warehousing and handling costs 1,154 1,118 4 2,276 Cost of goods sold 17,476 15,216 588 33,280 Lower-of-cost-or-market inventory — 705 — 705 Gross Margin (Deficit) $ 4,976 $ (2,078 ) $ 4,302 $ 7,200 Depreciation, depletion and accretion incurred 1 $ 7,138 $ 1,690 $ 104 $ 8,932 Three Months Ended March 31, 2017 Potash Trio ® Other Consolidated Sales $ 27,220 $ 21,112 $ 323 $ 48,655 Less: Freight costs 2,959 5,762 — 8,721 Warehousing and handling costs 1,512 1,258 — 2,770 Cost of goods sold 20,421 15,452 — 35,873 Lower-of-cost-or-market inventory — 3,824 — 3,824 Gross Margin (Deficit) $ 2,328 $ (5,184 ) $ 323 $ (2,533 ) Depreciation, depletion and accretion incurred 1 $ 7,563 $ 1,699 $ 61 $ 9,323 1 Depreciation, depletion and accretion incurred for potash and Trio ® excludes depreciation, depletion and accretion amounts absorbed in or relieved from inventory. |
COMPANY BACKGROUND (Narrative)
COMPANY BACKGROUND (Narrative) (Details) | 3 Months Ended |
Mar. 31, 2018Facility | |
By product credits | 9.00% |
Number of mining facilities | 3 |
SUMMARY OF SIGNIFICANT POLICI34
SUMMARY OF SIGNIFICANT POLICIES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||
Revenue Mineral Sales | $ 53,195 | $ 48,655 | |
Contract liability | 3,700 | $ 0 | |
Potash [Member] | Transferred at Point in Time [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue Mineral Sales | 27,064 | 27,220 | |
Trio [Member] | Transferred at Point in Time [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue Mineral Sales | 21,237 | 21,112 | |
Water [Member] | Transferred at Point in Time [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue Mineral Sales | $ 4,894 | $ 323 |
EARNINGS PER SHARE (Schedule of
EARNINGS PER SHARE (Schedule of Calculation of Basic and Diluted Loss or Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Earnings Per Share [Abstract] | ||
Net income (loss) | $ 1,757 | $ (13,678) |
Basic weighted average common shares outstanding (in shares) | 127,661,458 | 81,992,071 |
Add: Dilutive effect of restricted stock (in shares) | 2,184,000 | |
Add: Dilutive effect of stock options (in shares) | 920,000 | |
Diluted weighted average common shares outstanding (in shares) | 130,764,998 | 81,992,071 |
Income (Loss) per share: | ||
Basic (in dollars per share) | $ 0.01 | $ (0.17) |
Diluted (in dollars per share) | $ 0.01 | $ (0.17) |
EARNINGS PER SHARE (Schedule 36
EARNINGS PER SHARE (Schedule of Anti-Dilutive Shares) (Details) - shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Restricted Stock [Member] | ||
Anti-dilutive weighted average non-vested shares | ||
Anti-dilutive shares (in shares) | 3,398,777 | |
Stock Options [Member] | ||
Anti-dilutive weighted average non-vested shares | ||
Anti-dilutive shares (in shares) | 545,399 | 1,866,038 |
Performance Units [Member] | ||
Anti-dilutive weighted average non-vested shares | ||
Anti-dilutive shares (in shares) | 63,025 |
CASH, CASH EQUIVALENTS AND RE37
CASH, CASH EQUIVALENTS AND RESTRICTED CASH (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 6,085 | $ 1,068 | $ 20,770 | |
Restricted cash included in other long-term assets | 481 | 480 | ||
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows | $ 6,566 | $ 1,549 | $ 21,250 | $ 8,470 |
INVENTORY AND LONG-TERM PARTS38
INVENTORY AND LONG-TERM PARTS INVENTORY (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |||
Inventory valuation reserves | $ 3,600 | $ 4,200 | |
Lower-of-cost-or-market inventory adjustments | $ 705 | $ 3,824 |
INVENTORY AND LONG-TERM PARTS39
INVENTORY AND LONG-TERM PARTS INVENTORY (Summary of Inventory) (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Inventory [Line Items] | ||
Finished goods product inventory | $ 51,872 | $ 54,577 |
In-process mineral inventory | 15,837 | 19,822 |
Total product inventory | 67,709 | 74,399 |
Current parts inventory | 8,207 | 8,727 |
Total current inventory, net | 75,916 | 83,126 |
Long-term parts inventory, net | 31,106 | 30,611 |
Total inventory, net | $ 107,022 | $ 113,737 |
PROPERTY, PLANT, EQUIPMENT, A40
PROPERTY, PLANT, EQUIPMENT, AND MINERAL PROPERTIES (Schedule of Property, Plant, Equipment, and Mineral Properties) (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Property, plant, equipment, and mineral properties | ||
Depreciable assets | $ 393,571 | $ 388,284 |
Accumulated depreciation | (148,255) | (141,818) |
Depreciable assets, net | 245,316 | 246,466 |
Mineral properties and development costs | 138,880 | 138,841 |
Accumulated depletion | (28,436) | (26,840) |
Total depletable assets, net | 110,444 | 112,001 |
Land | 519 | 519 |
Construction in progress | 3,083 | 5,556 |
Total property, plant, equipment and mineral properties, net | 359,362 | 364,542 |
Buildings Plant [Member] | ||
Property, plant, equipment, and mineral properties | ||
Depreciable assets | 80,343 | 79,757 |
Machinery and Equipment [Member] | ||
Property, plant, equipment, and mineral properties | ||
Depreciable assets | 236,605 | 234,861 |
Vehicles [Member] | ||
Property, plant, equipment, and mineral properties | ||
Depreciable assets | 5,121 | 4,835 |
Office Equipment and Improvements [Member] | ||
Property, plant, equipment, and mineral properties | ||
Depreciable assets | 13,516 | 12,637 |
Ponds and Land Improvements [Member] | ||
Property, plant, equipment, and mineral properties | ||
Depreciable assets | $ 57,986 | $ 56,194 |
PROPERTY, PLANT, EQUIPMENT, A41
PROPERTY, PLANT, EQUIPMENT, AND MINERAL PROPERTIES (Schedule of Depreciation, Depletion, and Accretion) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Property, Plant and Equipment [Abstract] | |||
Depreciation | $ 6,919 | $ 7,160 | |
Depletion | 1,596 | 1,774 | |
Accretion | 417 | 389 | |
Total incurred | [1] | $ 8,932 | $ 9,323 |
[1] | Depreciation, depletion and accretion incurred for potash and Trio® excludes depreciation, depletion and accretion amounts absorbed in or relieved from inventory. |
DEBT (Narrative) (Details)
DEBT (Narrative) (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Debt | ||||
Interest expense | $ 932,000 | $ 4,451,000 | ||
Proceeds from credit facility | 13,500,000 | |||
Repayments of credit facility | 15,900,000 | |||
Senior Notes [Member] | ||||
Debt | ||||
Additional Required Principal Payment By December 31, 2018 | 10,000,000 | $ 10,000,000 | ||
Long-Term Debt | 60,000,000 | 60,000,000 | $ 60,000,000 | |
Adjusted EBITDA | 37,000,000 | |||
Minimum fixed charge coverage amount for quarters ending June 30, 2018 | 15,000,000 | |||
Minimum fixed charge coverage amount for quarters ending September 30, 2018 | 10,000,000 | |||
Fixed charge coverage amount | $ 15,700,000 | 15,700,000 | ||
Fixed charge coverage ratio | 3.78 | |||
Leverage Ratio | 1.66 | |||
Bank Of Montreal [Member] | ||||
Debt | ||||
Credit facility, maximum borrowing capacity | $ 35,000,000 | 35,000,000 | ||
Credit facility, capacity available for notes repayment | 10,000,000 | 10,000,000 | ||
Proceeds from credit facility | 13,500,000 | |||
Repayments of credit facility | 15,900,000 | |||
Line of Credit, Outstanding | 1,500,000 | 1,500,000 | ||
Letters of Credit Outstanding, Amount | 2,100,000 | 2,100,000 | ||
Line of Credit Facility, Current Borrowing Capacity | $ 31,400,000 | 31,400,000 | ||
Maximum [Member] | Senior Notes [Member] | ||||
Debt | ||||
Minimum Fixed Charge Ratio | 1.3 | |||
Maximum Leverage Ratio | 11.5 | |||
Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Bank Of Montreal [Member] | ||||
Debt | ||||
Credit facility interest | 2.25% | |||
Minimum [Member] | Senior Notes [Member] | ||||
Debt | ||||
Debt Instrument, Covenant Compliance, EBITDA | $ 7,500,000 | 7,500,000 | ||
Minimum Fixed Charge Ratio | 0.25 | |||
Maximum Leverage Ratio | 3.5 | |||
Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Bank Of Montreal [Member] | ||||
Debt | ||||
Credit facility interest | 1.75% | |||
Series A Senior Notes [Member] | Senior Notes [Member] | ||||
Debt | ||||
Long-Term Debt | $ 24,000,000 | $ 24,000,000 | ||
Interest Rate | 3.73% | 3.73% | ||
Series B Senior Notes [Member] | Senior Notes [Member] | ||||
Debt | ||||
Long-Term Debt | $ 18,000,000 | $ 18,000,000 | ||
Interest Rate | 4.63% | 4.63% | ||
Series C Senior Notes [Member] | Senior Notes [Member] | ||||
Debt | ||||
Long-Term Debt | $ 18,000,000 | $ 18,000,000 | ||
Interest Rate | 4.78% | 4.78% |
DEBT SCHEDULE OF LONG TERM DEBT
DEBT SCHEDULE OF LONG TERM DEBT (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Debt | ||
Long-term Debt, Current Maturities | $ (10,000) | $ (10,000) |
Senior Notes [Member] | ||
Debt | ||
Senior Notes | 60,000 | 60,000 |
Long-term Debt, Current Maturities | (10,000) | (10,000) |
Deferred financing costs | (530) | (563) |
Long-term debt, net | $ 49,470 | $ 49,437 |
DEBT SCHEDULE OF INTEREST EXPEN
DEBT SCHEDULE OF INTEREST EXPENSE (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Debt Disclosure [Abstract] | ||
Interest on notes and line of credit commitment fees | $ 749 | $ 2,836 |
Make-whole payments | 0 | 794 |
Amortization of deferred financing costs | 183 | 821 |
Gross interest expense | 932 | 4,451 |
Less capitalized interest | (54) | (30) |
Interest expense, net | $ 878 | $ 4,421 |
FINANCIAL INFORMATION FOR SUB45
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS OF POSSIBLE FUTURE PUBLIC DEBT (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Guarantees [Abstract] | ||
Cash | $ 6,085 | $ 1,068 |
ASSET RETIREMENT OBLIGATION (Na
ASSET RETIREMENT OBLIGATION (Narrative) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |
Asset Retirement Obligation, Undiscounted Amount | $ 59.5 |
Minimum [Member] | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |
Credit Adjusted Risk-Free Rates to Discount Abandonment Liabilities | 6.90% |
Maximum [Member] | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |
Credit Adjusted Risk-Free Rates to Discount Abandonment Liabilities | 9.70% |
ASSET RETIREMENT OBLIGATION (Sc
ASSET RETIREMENT OBLIGATION (Schedule of Changes to Asset Retirement Obligation) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Asset Retirement Obligation Disclosure [Abstract] | ||
Asset retirement obligation, at beginning of period | $ 21,476 | $ 19,976 |
Accretion of discount | 417 | 389 |
Total asset retirement obligation, at end of period | $ 21,893 | $ 20,365 |
COMMON STOCK (Details)
COMMON STOCK (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | May 31, 2017 | |
At the market offering common stock offering capacity | $ 40 | |
Shares issued under at the market offering program | 0 |
COMPENSATION PLANS (Narrative)
COMPENSATION PLANS (Narrative) (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Equity Incentive Compensation Plan [Abstract] | ||
Shares available for issuance | 2.3 | |
Non Qualified Stock Options [Abstract] | ||
Compensation expense | $ 0.9 | $ 1 |
Unrecognized compensation expense | $ 9.5 | |
Minimum [Member] | ||
Non Qualified Stock Options [Abstract] | ||
Period over which grants vest (in years) | 1 year | |
Maximum [Member] | ||
Non Qualified Stock Options [Abstract] | ||
Period over which grants vest (in years) | 3 years | |
Restricted Stock [Member] | ||
Restricted Stock [Abstract] | ||
Shares granted | 0.4 | |
Stock Options [Member] | ||
Non Qualified Stock Options [Abstract] | ||
Shares granted | 1.6 |
COMPENSATION PLANS (Schedule of
COMPENSATION PLANS (Schedule of Outstanding Share Based Awards) (Details) | Mar. 31, 2018shares |
Restricted Stock [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Awards outstanding, restricted stock | 3,403,056 |
Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Awards outstanding, options | 3,594,592 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Valuation and Qualifying Accounts Disclosure [Line Items] | ||
Effective Tax Rate | 0.00% | 0.00% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Reclamation Deposits and Surety Bonds | |||
Security placed with the State of Utah and BLM | $ 18.8 | $ 18.8 | |
Long-term restricted cash deposits | 0.5 | 0.5 | |
Surety bonds issued by an insurer | $ 18.3 | $ 18.3 | |
Future Operating Lease Commitments | |||
Operating Lease, Contract Term, Maximum (in years) | 30 years | ||
Rental and lease expense | $ 1 | $ 1.5 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Fair Value Disclosures [Abstract] | ||
Senior Notes, Fair Value | $ 56 | $ 58.8 |
BUSINESS SEGMENTS (Narrative) (
BUSINESS SEGMENTS (Narrative) (Details) | 3 Months Ended |
Mar. 31, 2018segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
BUSINESS SEGMENT (Information b
BUSINESS SEGMENT (Information by Segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Segment Reporting Information [Line Items] | |||
Sales | $ 53,195 | $ 48,655 | |
Less: Freight costs | 9,734 | 8,721 | |
Warehousing and handling costs | 2,276 | 2,770 | |
Cost of goods sold | 33,280 | 35,873 | |
Lower-of-cost-or-market inventory adjustments | 705 | 3,824 | |
Gross Margin (Deficit) | 7,200 | (2,533) | |
Depreciation, depletion and amortization expense | [1] | 8,932 | 9,323 |
Operating Segments [Member] | Potash [Member] | |||
Segment Reporting Information [Line Items] | |||
Sales | 27,064 | 27,220 | |
Less: Freight costs | 3,458 | 2,959 | |
Warehousing and handling costs | 1,154 | 1,512 | |
Cost of goods sold | 17,476 | 20,421 | |
Lower-of-cost-or-market inventory adjustments | 0 | 0 | |
Gross Margin (Deficit) | 4,976 | 2,328 | |
Depreciation, depletion and amortization expense | [1] | 7,138 | 7,563 |
Operating Segments [Member] | Trio [Member] | |||
Segment Reporting Information [Line Items] | |||
Sales | 21,237 | 21,112 | |
Less: Freight costs | 6,276 | 5,762 | |
Warehousing and handling costs | 1,118 | 1,258 | |
Cost of goods sold | 15,216 | 15,452 | |
Lower-of-cost-or-market inventory adjustments | 705 | 3,824 | |
Gross Margin (Deficit) | (2,078) | (5,184) | |
Depreciation, depletion and amortization expense | [1] | 1,690 | 1,699 |
Corporate/Other [Member] | |||
Segment Reporting Information [Line Items] | |||
Sales | 4,894 | 323 | |
Less: Freight costs | 0 | 0 | |
Warehousing and handling costs | 4 | 0 | |
Cost of goods sold | 588 | 0 | |
Lower-of-cost-or-market inventory adjustments | 0 | 0 | |
Gross Margin (Deficit) | 4,302 | 323 | |
Depreciation, depletion and amortization expense | [1] | $ 104 | $ 61 |
[1] | Depreciation, depletion and accretion incurred for potash and Trio® excludes depreciation, depletion and accretion amounts absorbed in or relieved from inventory. |
RECENT ACCOUNTING PRONOUNCEME56
RECENT ACCOUNTING PRONOUNCEMENTS (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2017 | |
Accounting Standards Update 2014-09 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 500 | |
Accounting Standards Update 2016-18 [Member] | ||
Net cash flow | $ 3,500 |