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DATE

Thursday, May 7, 2026 at 9:30 a.m. ET

CALL PARTICIPANTS

  • President & CEO — Edward Dowling
  • Chief Financial Officer — Peter Fjellman
  • Chief Commercial Officer — Ben Nichols
  • Chief Operations Officer — Patrick Merrin

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TAKEAWAYS

  • Consolidated Revenue -- $453 million, a decrease of $41 million or 8%, primarily due to lower highway deicing sales.
  • Adjusted EBITDA -- $86 million, up 3.3% from $84 million in the prior-year period, with a company-wide adjusted EBITDA margin improvement to 19.1% from 17%.
  • Salt Segment Revenue -- $303 million, compared to $433 million in the prior-year period; tons sold were 4.1 million, down 19% versus the prior year, reflecting winter weather timing and geography.
  • Salt Operating Earnings per Ton -- $15.85 per ton, up 21% from $13.10 per ton, reflecting price realization offset in part by higher distribution and product costs.
  • Plant Nutrition Revenue -- $67 million, up from $58 million; adjusted EBITDA was $17 million, up 202%, and adjusted EBITDA margin rose to 25.2% from 9.6% year over year.
  • Year-to-Date Adjusted EBITDA -- $152 million, up 32% from $116 million; adjusted EBITDA margin for the first half was 17.9%, versus 14.5%.
  • Net Debt -- $639 million, down $119 million year over year; leverage ratio improved to 2.7x trailing twelve months from 4.6x, following $150 million in 2027 senior unsecured notes retired early with cash.
  • Liquidity -- $379 million, including $74 million cash and $305 million revolver capacity.
  • Full-Year Adjusted EBITDA Guidance -- Updated range is $212 million to $236 million (midpoint $224 million); Salt segment midpoint reduced to $233 million from $241 million, Plant Nutrition raised to a $45 million midpoint.
  • Interest Expense Guidance -- Net interest expense lowered to a $62 million to $67 million range due to the note paydown.
  • Portfolio Changes -- Wynyard SOP operation sale completed during the quarter, with proceeds improving the cash position and sharpening Plant Nutrition segment focus.
  • Board Composition -- Four new directors added in the last year, all with relevant industrial or sector expertise; management says the Board is "aligned with our strategy" and provides "the operating and financial expertise we need."
  • Labor Relations -- New collective bargaining agreements completed at the Goderich mine and one other site, aimed at improving operational flexibility and efficiency.

SUMMARY

Compass Minerals (CMP +6.73%) experienced a year-over-year revenue decline primarily due to lower highway deicing sales but delivered higher profitability as demonstrated by increased EBITDA and improved margins across both Salt and Plant Nutrition segments. The company completed early retirement of its $150 million 2027 senior notes, reducing net debt and extending maturities to 2028, with a clear focus on deleveraging the balance sheet and enhancing financial flexibility. Management highlighted the conclusion of major plant sales, new collective bargaining agreements, and the addition of four directors with relevant expertise as pivotal to their ongoing strategic execution. Operational disciplines, especially at Goderich and Ogden, remain in progress with tangible results in cost and margin improvements, but management continues to cite ongoing work to reach targeted efficiency. Portfolio simplification and discipline on working capital are emphasized as key strategic pillars supporting improved financial outlook and segment guidance adjustments.

  • Management stated, "inventories across the system are low following the past winter," suggesting favorable conditions for pricing and tender size in the upcoming deicing bid season.
  • Salt segment cost per ton rose due to shifts in geographic and product mix as well as the pace of operational improvements; management expects continued but gradual efficiency gains in this area.
  • The Plant Nutrition segment’s margin gains are attributed to "better operational execution and strong asset utilization," with the company noting Ogden's "world-class" cost performance and planned investments for further improvement.
  • The $150 million note redemption was "from cash on hand" and resulted in the removal of the company’s "nearest maturity," reinforcing the stated priority of balance sheet strength.
  • Guidance ranges for capital expenditures, depreciation, depletion and amortization, and effective income tax rate remain unchanged for the remainder of the year.
  • Early input from bid season participants is "positive and support the thesis" of thin industry inventories and constructive market pricing, according to commercial management.

INDUSTRY GLOSSARY

  • SOP (Sulfate of Potash): A specialty fertilizer product derived from brine or mineral sources, used for high-value crops requiring low chloride content.
  • Adjusted EBITDA: Non-GAAP measure calculated as earnings before interest, taxes, depreciation, and amortization, adjusted for specified items to reflect operational performance.
  • Collective Bargaining Agreement (CBA): A negotiated contract between company management and unionized workforce governing labor terms, pay, and operational flexibility at mining and production sites.

Full Conference Call Transcript

Edward Dowling, and our CFO, Peter Fjellman. Joining for the question-and-answer portion of the call will be Ben Nichols, our Chief Commercial Officer, and our Chief Operations Officer, Patrick Merrin. Before we get started, I will remind everyone that the remarks we make today reflect financial and operational outlooks as of today's date, 05/07/2026. These outlooks entail assumptions and expectations that involve risks and uncertainties that could cause Compass Minerals International, Inc.'s actual results to differ materially. A discussion of these risks can be found in our SEC filings located online at investor.compassminerals.com. Our remarks today also include certain non-GAAP financial measures.

You can find reconciliations of these items in our earnings release or in our presentation, both of which are also available online. With that, I will now turn the call over to Edward Dowling.

Edward Dowling: Thank you, Brent. Good morning, everyone, and thank you for joining us today. I will get right to it. In the second quarter, we retired our remaining $150 million of the 2027 senior unsecured notes earlier than anticipated. We continue to push on operational improvements at Goderich and elsewhere. We had a strong winter across much of North America, and our Salt business delivered on a high level of sale commitments while continuing to build on the foundation we have put in place. We are making progress and we recognize that we have more work to do. In Plant Nutrition, we are showing outstanding momentum against the objectives we outlined two years ago.

With the winter season behind us, it is worth looking at how much the first half of this year has improved from last year. In both the Salt and Plant Nutrition businesses, revenues are up, operating margins are up, EBITDA is up, company-wide debt is down, and SG&A is down. And we completed new collective bargaining agreements with two of our sites, including the Goderich mine. That is a great start for the year. Now let us talk about what we are doing in each of our businesses. The improvement processes that we have successfully deployed within our SOP business are the same approach that we are using in the Salt business, starting with our larger operations.

A focus on restoring good long-term operating discipline is critical to improving performance. This requires that we focus on key metrics that will drive performance: safety, utilization, equipment availability, production and development rates, and improved mine planning processes, all of which are advancing. This is a key part of our Back to Basics framework. Production cost per ton in the Salt business moved up year over year, and I want to explain why. The reported number reflects several factors: regional weather activity, product mix, and the pace of our operational improvements. During the quarter, we began selling production from the current year's production, which flows through the P&L.

While production cost per ton within the mines is improving, we have not yet met the efficiency gains we expected. Peter will walk you through this in more detail. As I noted earlier, we recently completed a new CBA with the workforce at Goderich. It was a fair agreement for everyone and reflects a genuine partnership between Compass Minerals International, Inc. and our workforce. This mutually beneficial arrangement allows us to continue building on a safe, reliable operation while allowing us to enhance the mine's efficiency and flexibility. We have also concluded a CBA at another site and are in the process of completing negotiations at others.

While the highway deicing season is behind us, our focus turns to building inventory and preparing for next year's deicing bid season. Our production and inventory planning will be informed in part by the commitments we win in the upcoming bid season. The North American highway deicing market remains structurally tight, and inventories across the system are low following the past winter, which is constructive for both pricing and tender size growth. We are moving into the bid season with this framework firmly in mind. We will be focused on maximizing the value of every ton we commit for the next season.

The market conditions are constructive, and we will approach the upcoming bid season with the same discipline that we brought to the market in recent years that has allowed us to see growth in pricing and margin. Based on our first-half performance and the current operational plans, we have updated our full-year adjusted EBITDA guidance with the midpoint essentially unchanged. We have adjusted the segment outlooks. Plant Nutrition is running ahead. We have moderated Salt to reflect the impact of regional product mix in sales as well as the pace of operational improvements I described earlier. Peter will walk you through the updated ranges.

Consistent with our Back to Basics framework, as announced earlier this year, we simplified our portfolio with the sale of our Wynyard SOP operation, which was completed during the quarter. The sale strengthened our cash position and now allows the Plant Nutrition business to focus on our world-class Ogden facility. Turning to the balance sheet, in March we redeemed the remaining $150 million of our 2027 senior unsecured notes. We funded the paydown from cash on hand and removed our nearest maturity. This represents a significant deleveraging milestone and provides us with more financial flexibility. Reducing debt remains one of our top priorities, and it strengthens our balance sheet as a result.

This is what investors expect, and it is what we are doing. Before I hand it over to Peter, I want to briefly note the recent changes to our Board. We have added four new directors over the past year. Each brings deep knowledge and relevant experience in the industrial manufacturing businesses, some of which have direct experience in the salt and plant nutrition industries. The Board is aligned with our strategy and brings the operating and financial expertise we need for this phase of the company’s development. With that, I will turn the call over to Peter to walk you through the numbers and our outlook.

Peter Fjellman: Thanks, Ed. I will walk through our financial results as well as our updated outlook. For the 2026 second quarter, consolidated revenue was $453 million, down $41 million, or 8%, versus the prior-year Q2. The decrease is primarily due to lower highway deicing sales in the current quarter. Adjusted EBITDA was $86 million compared to $84 million in the prior-year Q2, up 3.3% year over year. Adjusted EBITDA margin was 19.1% compared to 17% in the prior year. The improvement reflects adjusted EBITDA margin growth in both the Salt and the Plant Nutrition businesses as well as lower SG&A expense year over year. In the Salt business, revenue was $303 million compared to $433 million in the prior-year Q2.

Tons sold were 4.1 million, down 19% versus prior year, which is a function of the timing and velocity of the winter weather. On a per-ton basis, operating earnings were $15.85 per ton, up 21% versus $13.10 per ton in the prior-year Q2. The per-ton progression reflects price realization, offset partially by increased distribution and product costs. As Ed mentioned, the sales mix dynamic in Q2 warrants some additional commentary. Our Salt business serves customers and end uses across multiple production facilities across different geographies. In any given year, the volume each facility contributes depends significantly on where winter weather occurs. With different price and cost structures, volume shifts in a given season can impact comparability.

So the reported cost per ton reflects three things: the geographic mix driven by weather, product mix, and the production cost dynamics at the facility level. In the Plant Nutrition segment, revenue was $67 million compared to $58 million in the prior-year Q2. Adjusted EBITDA was $17 million, up 202% year over year, with the adjusted EBITDA margin improving to 25.2% in the current quarter from 9.6% a year ago. I want to note that we closed on the sale of our SOP operations at Wynyard during the quarter. Q2 2026 only reflects the partial contribution from that asset prior to the sale, which makes the year-over-year comparison even more impressive. Throughput continues to be strong.

We are achieving year-over-year cost favorability from better operational execution and strong asset utilization. On a year-to-date basis, first-half adjusted EBITDA was $152 million compared to $116 million in the first half of last year, a 32% increase year over year. Adjusted EBITDA margin for the first half of the year was 17.9% compared to 14.5% for the first half a year ago. These combined results show that the plan we put in place is working. We are working hard to maximize value, control cost, and manage working capital and inventory. The result is that we are enhancing profitability and deleveraging the balance sheet simultaneously.

Switching to the balance sheet, as Ed noted, we redeemed the remaining $150 million of our 2027 senior unsecured notes. The redemption, which was funded from cash, extends our maturity profile and deleverages the balance sheet. We also renewed our accounts receivable securitization facility during the quarter on improved terms. Combined with the retirement of the 2027 notes, our significant debt maturity is now in 2028, which gives us meaningful runway to continue executing on our operational priorities without near-term refinancing pressure. At quarter end, total net debt was $639 million, down $119 million versus Q2 prior year. Our leverage ratio was 2.7 times on a trailing twelve-month basis, compared to 4.6 times last year.

We are focused on continuing to strengthen the balance sheet. Liquidity at quarter end was $379 million, comprised of cash of $74 million and revolver capacity of around $305 million. We are updating our full-year adjusted EBITDA guidance range to $212 million to $236 million, with a midpoint of $224 million. We have adjusted the Salt segment outlook; the midpoint is now $233 million compared to the previous midpoint of $241 million. The adjustment reflects the factors I mentioned above. Plant Nutrition adjusted EBITDA is now $43 million to $47 million, with a midpoint of $45 million, up from the prior midpoint. Volumes are up, pricing is favorable, and Ogden is delivering strong cost performance.

This is a straightforward story and a reflection of the work we started two years ago to restore the business to historical levels of financial performance. The ranges for corporate adjusted EBITDA items including capital expenditures, depreciation, depletion and amortization, and the effective income tax rate remain unchanged. Interest expense, net, is now lower at $62 million to $67 million to reflect the paydown of the 2027 senior unsecured notes. Operator, we are now ready for questions.

Operator: Thank you. Please press star followed by the number 1 on your telephone keypad, and please limit your questions to one question and one follow-up. We will pause for just a moment to compile the Q&A roster. Our first question comes from the line of Joel Jackson with BMO Capital Markets. Your line is open.

Evan McCall: It is Evan on for Joel. Just a couple here. If you could talk about what we can expect from Salt costs over the next couple of years before the potential mill project comes online at Goderich.

Edward Dowling: Good morning. We do not generally guide on cost, but as we work our way through our operational improvements, unit costs at the mine should continue to decrease from where we are now and toward our targeted performance. If you look at some of the key KPIs, we are reaching a point we have not done at the mine before. We need to do that because we are still facing headwinds with regard to where we sit in the mine plan.

Evan McCall: Great, thanks. And the full-year guide for this year in Salt specifically— you raised volumes, but you lowered your margins. Can you talk about some of the puts and takes there? I understand some issues at Goderich, but you are also raising the volume, so just some color on that would be great.

Edward Dowling: Let me pass that off to Peter.

Peter Fjellman: Sure. Thanks for the question. Overall it really comes down to the reported cost per ton reflecting the three things we mentioned in our opening comments: geographic mix, production dynamics at a facility level, and product mix. This year, it is simply that the heavier proportion of winter sales occurred in certain served markets, including limited winter impact out West, and higher volumes in higher-cost served markets, as well as mix within our C&I business. Those always carry different cost profiles. So our guidance is updated to reflect those factors.

Evan McCall: Okay. Can I sneak one more in? I know it is early, but are you seeing any specific trends in the upcoming bid season in terms of volumes, bids, and prices for the rock salt bid season? And any color on channel inventories?

Edward Dowling: Thanks for the question. It is early days in the bid season for us—very early days. As we said, we expect the market to be constructive. Our primary focus is always value over volume, and we are focused on maximizing value on every ton of production across all of our facilities. We will have much better visibility and be able to report on it in our Q3 2026 earnings call.

Operator: Thank you. Our next question comes from the line of David Silver with Freedom Capital Markets.

David Silver: Hi, thank you. I would like to follow up on Ed’s comments in the press release where you said, “we know what we have to do, we still have work to do,” in terms of addressing Salt mine production efficiency. Could you highlight what is included in the “work that you have to do” there?

Edward Dowling: Thanks, David. This is really core to what we are focused on: driving our costs everywhere— not just at Goderich—into a more competitive position. These are things like improving maintenance practices so that we can improve the availability of the equipment, run more hours in the day, and actually take advantage of that through utilization. We are seeing good inputs on elimination of waste, improvements in our mine planning efforts, and other things. We have a handful of teams underway working on this very diligently, and there is a lot more to come. Later this month, we will be commissioning a number of other teams to really tackle some strong enterprise opportunities for us.

Let me ask Patrick if there is anything else he would like to add to that.

Patrick Merrin: Hi, David. I think Ed hit the main points well. We are focused on the basic fundamentals of how mines operate. At Goderich, that comes down to: are the machines getting fixed, are they available, are we using them, and are we using them the way we should be? Then, optimization of our mine planning process— all of which has been underway for a year or so. We are seeing benefits from that, just not coming in as quickly as we would have liked. But improvements are continuing.

Edward Dowling: Thanks for that, Patrick. We are seeing some really great green shoots coming up from this effort. I feel pretty good about it, and we will be reporting more on this as time goes by.

David Silver: And then if I could follow up on your comments about the new collective bargaining agreements— in particular, Goderich. Does the current CBA include any greater flexibility on your part in terms of how you can deploy labor and equipment in the normal day-to-day operation of Goderich?

Edward Dowling: The simple answer is yes. But it is a mutually beneficial agreement, and we are all incented, including the workforce, to improve performance. Let me pass it to Patrick for a little more color at a high level.

Patrick Merrin: David, we cannot get too far into the details. What I will say is that we have spent a lot of time over the last 18 months working on the relationship with our union, which has improved dramatically. I think the CBA reflects our desire and their desire to see the site succeed. We are looking forward to continuing to work with our workforce in driving improvements in safety, cost, and tonnage, and we think the CBA is going to allow us to do that.

David Silver: Okay. One last question for me regarding Ogden and the very strong improvement in your SOP business. When I look at the results, I am wondering: is the meaningful improvement in per-ton margins related to accessing more brine-based tons versus supplemental purchases of KCl? How much is just the nuts and bolts of operating the evaporation ponds versus tapping into a richer source brine?

Edward Dowling: That is a great question, and it depends where you start the clock. If we turn the clock back a couple of years, remember our earnings out of that entire business, including Wynyard, were in the mid-teens. Now we are back to historical levels of about $50 million a year—$40 million to $50 million was our target—and we are there, with more improvement to come. A lot of that improvement is exactly what you said: managing the ponds correctly and building up the salt at the right grades.

Remember we talked about the harvest-to-production ratio and those details— getting that right, and then putting sufficient inventory in front of our wet plant so that we can stabilize the plant in a better way. That has been a great success for us and we will continue to do that. We will continue to supplement as appropriate with KCl, but the big improvement over the last couple of years is really managing the ponds better and restoring that discipline. We are not done yet. We have an important capital project that will be done later next year—the drier/compaction plant—where we currently have yield losses and other issues at high loads and inefficient operations.

We aim to improve product quality and, when we execute that project, we should see more capacity at lower cost, all else equal, with better quality than what we are producing now.

David Silver: Thank you for all the color. I will get back in the queue.

Operator: Please press star followed by the number 1 on your telephone keypad. We will pause for just another moment to compile the Q&A roster. We have a question from David Silver of Freedom Capital Markets. Your line is open.

David Silver: Thanks very much. I wanted to ask about your tax situation for fiscal 2026. I would love to get Peter’s comments on what kind of cash tax liability range we should expect. It is a complicated analysis with different geographies and, on top of that, the settlement with the Government of Ontario. As we think about cash flow and free cash flow, what could you point us to in terms of cash taxes for this year?

Edward Dowling: It is a complicated question. The short answer is that within our guidance, everything is built into that and nothing has really changed. In terms of details, let me pass it to Peter to address with a little more substance.

Peter Fjellman: Thank you. David, as we have spoken about before, the effective tax rate at Compass can swing based on the relative mix—income in Canada and losses in the U.S.—adding up to a relatively small number for income tax purposes in aggregate. That tends to create variability in the effective rate. From a cash standpoint, which is your question, remember that we did make some payments related to the Ontario mining matter as part of the resolution in previous quarters, and we have adjusted our balance sheet and cash payments accordingly. We are working through that as well. At this point, there is not a lot to guide on cash taxes, and we will have a better update in Q3 2026.

Edward Dowling: Thanks, Peter. Just to close that thought, put yourself back a year or two. We had a lot of non-core business issues in the company. Getting these matters behind us—in terms of the refinancing we have done, the Ontario mining tax, and a number of legal issues—has really cleared much of this out of the company. The great news is it allows us to focus more on what is important.

David Silver: Great. And just at a high level heading into the current bid season: earlier this year it was very tight supply across your primary marketing region, but the last month or so of winter was pretty mild. Do you think the industry is still in scarcity mode, or has the mild March weather allowed some normalization? Last year you had low single digits on volume and price; are you looking to improve upon that? Any comments on ending inventories at key customers and yourselves?

Edward Dowling: It is always important, when we talk about inventories, to talk about where. We had a really strong winter in much of our northern system, and inventories remain tight there. We had a better winter in the South—that is part of what is driving the mix and cost. In the UK and out West, particularly where our lowest-cost salt is produced, it was less so, and inventories remain higher there. Within that context, our objective is to maximize value. Let me pass it to Ben for some comments.

Ben Nichols: The scenario is very constructive for value moving forward. We see the industry with thin inventories coming out of the last season, all else equal. While it is early in the bid process, the few data points we have seen are positive and support the thesis we have stated. We are excited about the bid season. The team is very focused on driving value for every ton that we sell, and we will have a lot more detail for you when we get together about a quarter from now.

David Silver: Very helpful. Thank you very much. Appreciate it.

Operator: There are no additional questions in the queue. I will turn it back to Edward Dowling, President and CEO, for closing remarks.

Edward Dowling: Thank you all for your questions and your interest in Compass Minerals International, Inc. I will leave you with this: We had a strong quarter, but the journey is not finished. Some of the hard work is continuing to drive operational improvements— and we are. Some is continuing to improve the Plant Nutrition business— and we are. Some of it is retiring debt to improve our balance sheet— and we are. And some of it is disciplined execution on our commercial side— we are doing that too. The direction is right, the strategy is sound, and the team is committed. We look forward to updating you on our next call.

Operator: Thank you. This concludes today's conference call. You may now disconnect.