Compass Minerals Reports Third-Quarter Revenue Growth Across All Operating Segments.OVERLAND PARK Overland Park, city (1990 pop. 111,790), Johnson co., NE Kans., a residential suburb of Kansas City; inc. 1960. There is printing and publishing, and the manufacture of apparel, aircraft parts, cement, prepared foods, salt, chemicals, marine accessories, and signs. , Kan. -- Compass Minerals Compass Minerals International (NYSE: CMP) is the second-leading salt producer in the United States and largest in the United Kingdom. Most of the salt produced is sold for highway de-icing. (NYSE NYSE See: New York Stock Exchange : CMP CMP (cytidine monophosphate): see cytosine. (1) (CMP Media LLC, Manhasset, NY, www.cmp.com) Part of United Business Media, CMP is a leading integrated media company that offers a wide variety of publications and services in the information ) reported the following results of third-quarter operations: * Sales increased 13 percent over the prior-year quarter to $139.5 million. * Gross profit increased 10 percent to $32.5 million and operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before declined modestly to $16.3 million compared to the 2006 quarter. * Net earnings were $6.7 million, or $0.20 per diluted share, including a $4.1 million non-cash benefit from the partial release of a tax reserve. * Excluding the one-time benefit, net earnings were $2.6 million, or $0.08 per diluted share, compared to net earnings of $2.3 million, or $0.07 per diluted share, in the 2006 quarter. * Cash flows from operations for the nine months ended September 30, 2007 improved by $7.8 million, or 10 percent, over the comparable prior-year period. "Compass Minerals continues to strengthen its summer-season sales through pricing and mix-improvement strategies," said Angelo Brisimitzakis, Compass Minerals president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "Our results this quarter also reflect our continuing investments in initiatives that will enable Compass Minerals to deliver profitable long-term growth and sustainable shareholder value creation." [TABLE OMITTED] SALT SEGMENT [TABLE OMITTED] Salt segment sales increased 10 percent over the 2006 quarter. Pricing increased by an average of 5 percent on highway deicing De-icing is the process of removing ice from a surface. Anti-icing is the process of preventing ice from forming on a surface. Deicing can be accomplished by mechanical methods (scraping), through the application of heat, by use of chemicals designed to lower salt and an average of 15 percent on consumer and industrial products. Salt segment sales volumes increased 2 percent, driven by a 6 percent year-over-year increase in highway deicing shipments. The highway deicing volume increase was due to stronger sales to the chemical industry and more pre-season deliveries of deicing salt in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , partially offset by lower sales in the United Kingdom. Consumer and industrial sales volumes declined by 5 percent compared to the prior-year quarter due to industrial customer relocations and Compass Minerals' ongoing focus on improving profit margins through pricing initiatives, which resulted in the loss of several very low-margin accounts. Salt segment operating earnings declined 8 percent year-over-year as higher rail and trucking rates and fuel surcharges moderately increased shipping and handling costs; lower rock salt production and increased maintenance spending contributed to higher per-unit product costs; and investments in personnel and outside services to support long-term growth strategies contributed to higher selling, general and administrative expenses. Compass Minerals has nearly completed the process of bidding for North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. highway deicing awards for the 2007-2008 winter season and expects an approximate 5 percent increase in bid award volume and an approximate 4 percent improvement in average bid award prices compared to the 2006-2007 winter-season bid awards. SPECIALTY FERTILIZER SEGMENT [TABLE OMITTED] Specialty fertilizer segment sales improved 13 percent over the 2006 quarter reflecting a 19 percent improvement in average selling prices, partially offset by a 3 percent decline in sales volumes as a result of year-over-year differences in the timing of certain international shipments. Compass Minerals currently expects 2007 specialty fertilizer sales volumes to exceed 2006 sales volumes by approximately 10 percent. Specialty fertilizer segment operating earnings improved 22 percent, expanding the segment's operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: by two percentage points, as price improvements more than offset structural increases in input and logistics costs. OTHER FINANCIAL HIGHLIGHTS Compass Minerals' U.K.-based records management business more than doubled sales year-over-year to $2.6 million in the 2007 quarter from $1.2 million in the 2006 quarter. The increase was primarily due to the January 2007 acquisition of a complementary London-based competitor, which continues to be moderately accretive to earnings. The results of the company's records management business and its assets are in "Corporate and Other" segment reporting segment reporting A type of financial reporting in which the firm discloses information by identifiable industry segments. For example, Union Pacific Corporation reports revenues, income, assets, depreciation, and capital expenditures for each of four . Selling, general and administrative expenses increased $3.5 million over the 2006 quarter. In addition to investments in personnel and services to support segment growth strategies, the increase reflects $1.4 million of additional expenses from the company's newly consolidated records management business and a prior-year one-time benefit related to an insurance recovery. Interest expense increased $0.3 million over the prior-year quarter because of accretion on the company's discount notes, partially offset by lower average borrowings on its credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities . Total debt increased $2.0 million from December 31, 2006, due to accretion on the company's discount notes and borrowings on its revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility, reflecting seasonal differences in working capital. The company voluntarily made a $10 million early principal payment on its term loan in the 2007 quarter. The company's income tax benefit of $3.7 million includes a $4.1 million non-cash benefit from the partial release of reserves for uncertain tax positions. During October 2007, Compass Minerals commenced a cash tender offer for its outstanding 12.75 percent senior discount notes and has redeemed approximately 97 percent, or $120.0 million face amount, of the notes for $126.9 million, including a consent payment. The tender period ends at midnight on October 30, 2007. The company funded the redemption through a $127.0 million incremental term loan under its existing credit facilities at an interest rate of 2.0 percent over LIBOR LIBOR See: London Interbank Offered Rate LIBOR See London interbank offered rate (LIBOR). . An interest rate swap Interest Rate Swap A deal between banks or companies where borrowers switch floating-rate loans for fixed rate loans in another country. These can be either the same or different currencies. fixes the underlying LIBOR rate at 4.565 percent on $50 million of the loan until 2010. Conference Call Compass Minerals will discuss its results on a conference call on Tuesday, October 30, at 10:00 a.m. Eastern time. To access the conference call, interested parties should visit the company's website at www.CompassMinerals.com or dial 877-228-7138. Callers must provide the conference ID number 20531591. Outside of the U.S. and Canada, callers may dial 706-643-0377. Replays of the call will be available on the company's website for two weeks. The replay can also be accessed by phone for seven days at 800-642-1687, conference ID 20531591. Outside of the U.S. and Canada, callers may dial 706-645-9291. About Compass Minerals Based in the Kansas City metropolitan area, Compass Minerals is a leading producer of inorganic minerals, including salt, sulfate sulfate, chemical compound containing the sulfate (SO4) radical. Sulfates are salts or esters of sulfuric acid, H2SO4, formed by replacing one or both of the hydrogens with a metal (e.g., sodium) or a radical (e.g., ammonium or ethyl). of potash specialty fertilizer and magnesium chloride magnesium chloride Warning - High-alert drug! Chloromag, Mag 64, Mag Delay, Slo-Mag Pharmacologic class: Mineral Therapeutic class: . The company provides highway deicing salt to customers in North America and the United Kingdom, and produces and distributes consumer deicing and water conditioning products, ingredients used in consumer and commercial foods, specialty fertilizers, and products used in agriculture and other consumer and industrial applications. Compass Minerals also provides records management services to businesses throughout the U.K. Non-GAAP Measures Management uses a variety of measures to evaluate the company's performance. In addition to using GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). financial measures, such as gross profit, net earnings and cash flows generated by operating activities, management uses EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become , a non-GAAP financial measure, to evaluate the performance of our core business operations. To effectively manage our resource allocation resource allocation Managed care The constellation of activities and decisions which form the basis for prioritizing health care needs , cost of capital and income tax positions, we evaluate the operating units on the basis of EBITDA. EBITDA is not calculated under GAAP and should not be considered in isolation or as a substitute for net earnings, cash flows or other financial data prepared in accordance with GAAP or as a measure of our overall profitability or liquidity. EBITDA excludes interest expense, income taxes and depreciation and amortization, each of which is an essential element of our cost structure and cannot be eliminated. Our borrowings are a significant component of our capital structure and interest expense is a continuing cost of debt. We are also required to pay income taxes. We have a significant investment in capital assets capital assets n. equipment, property, and funds owned by a business. (See: capital, capital account) , and depreciation and amortization reflects the utilization of those assets in order to generate revenues. Consequently, any measure that excludes these elements has material limitations. EBITDA does, however, include other cash and non-cash items which management believes are not indicative of the ongoing operating performance of our core business operations. Management excludes these items to calculate adjusted EBITDA. While EBITDA and adjusted EBITDA are frequently used as measures of operating performance, these terms are not necessarily comparable to similarly titled measures of other companies due to potential inconsistencies in the methods of calculation. Excluding special items from net earnings is meaningful to investors because it provides insight with respect to the ongoing operating results of the company. Special items include the partial release of a tax reserve. Management's calculations of these measures are set forth in the following tables. This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These statements are based on the Company's current expectations and involve risks and uncertainties that could cause the Company's actual results to differ materially. The differences could be caused by a number of factors including those factors identified in Compass Minerals International's annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the Securities and Exchange Commission on February 22, 2007. The Company undertakes no obligation to update any forward-looking statements made in this press release to reflect future events or developments. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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