For those on the East Coast of the U.S., an unusually tough winter seemed to bode well for road salt and plant nutrition specialist Compass Minerals International (CMP 0.46%). Although Compass has tried to diversify its business to reduce some of its seasonality, weather conditions still play a role in its results, especially at this time of year.

Coming into Tuesday's fourth-quarter financial report, Compass investors were hoping to see better earnings and solid revenue gains. Compass did an even better job than many had expected in boosting its bottom line, but winter weather came too late to fall into the company's fourth quarter, pushing any favorable impact into the future.

Let's look more closely at Compass Minerals and what its results say about its future.

Logo featuring words natural salt in blue with white waves.

Image source: Compass Minerals.

Compass battles on

Compass Minerals' fourth-quarter results reflected some of the factors that the company has seen all year. Sales were up just 3% to $457.9 million, or about half the growth rate investors had wanted to see. Adjusted net income of $56.2 million was up more than 20% from year-ago levels, and adjusted earnings of $1.66 per share were well ahead of the consensus forecast among those following the stock for $1.49 per share.

Tax reform dealt Compass a hit to its bottom line. A one-time tax on foreign earnings cost the company $55.2 million, which was only partially offset by revaluation of deferred tax liabilities worth about $8.4 million.

Fundamentally, Compass kept seeing resistance in some of its key business lines. Salt sales were down 2%, with the company blaming a late start to winter conditions in North America as offsetting better conditions in the U.K. market. Demand for consumer and commercial deicing products was particularly poor, falling 10% from year-earlier levels, and segment operating earnings were down 8%. Overall, weather was a net negative for Compass during the period.

By contrast, Compass' plant nutrition businesses did well. The North American segment saw 12% revenue gains on stronger volume, and despite falling margin levels, adjusted pre-tax operating income for the unit was slightly higher. In South America, revenue jumped 10% on solid gains in both pricing and volume, and pre-tax operating profit was higher by about 37%.

CEO Fran Malecha praised the change in the company's strategic vision. "While this has been a challenging year for Compass Minerals," Malecha said, "our results are demonstrating the value of our strategy to balance our winter weather exposure by growing our plant nutrition business with a strong focus on innovative specialty products." The CEO also cited increased production capacity and efficiency for driving cost reductions.

What's ahead for Compass Minerals in 2018?

Compass Minerals is optimistic that the relatively severe winter in North American in late December and January has already led to better results during the first quarter of 2018. Yet the company did warn that relatively high carryover inventory levels could still hurt operating margin levels for the segment.

Meanwhile, on the fertilizer front, Compass sees steady growth. Modest year-over-year gains in North America in the first half of 2018 will come from potash and more innovative products, while South America will rely more heavily on the results of Compass' innovation.

More specifically, Compass sees earnings of $2.75 to $3.25 per share in 2018, based on full-year salt volume of 11.8 million to 12.6 million tons, North American plant nutrition volume of 320,000 to 350,000 tons, and South American volume of 700,000 to 900,000 tons. Total first-quarter revenue projections for $615 million to $700 million will come primarily from salt, where operating margin will also be the highest.

Compass Minerals shareholders didn't immediately respond to the news, and the stock was unchanged in after-hours trading immediately following the announcement. In the long run, what's more important is for Compass to keep driving growth throughout its business, reaping the rewards of more balanced exposure while finding ways to be more efficient and profitable.