Intrepid Potash (IPI)

[CHA$E]

Intrepid Announces 2010 Fourth Quarter and Full Year Financial Results

5:19p ET February 23, 2011 (Business Wire)

Intrepid Potash, Inc. (NYSE:IPI) announced today 2010 fourth quarter and full year financial results, with net income for the fourth quarter of $18.2 million, resulting in $0.24 of earnings per diluted share. Adjusted earnings before interest, taxes, depreciation, and amortization (Adjusted EBITDA(1)) for the fourth quarter of 2010 was $37.3 million.

"During the fourth quarter of 2010, we saw a significant expansion in nutrient demand, which was more robust than we had expected and was further bolstered by a strengthening commodity market," said Bob Jornayvaz, Intrepid's Executive Chairman of the Board. "A number of factors contributed to the overall strength of the potash market domestically during the fourth quarter. Mild fall weather and an early harvest in much of the United States allowed for an extended application period for potash and other nutrients well into December. Further, prices for virtually every agricultural commodity moved higher, as yield estimates were trimmed and global demand continued to grow, driving farmer economics to historically attractive levels."

Fourth Quarter 2010 Highlights:

Potash sales increased 44 percent in the fourth quarter of 2010 to 216,000 tons as compared to 150,000 tons sold in the same period of 2009. Potash production increased 81 percent in the fourth quarter of 2010 to 224,000 tons compared to 124,000 tons produced in the fourth quarter of 2009. The average net realized sales price(2) for potash was $386 per ton ($425 per metric tonne) in the fourth quarter of 2010, compared to $408 per ton ($450 per metric tonne) in the fourth quarter of 2009. Our cash operating cost of goods sold, net of by-product credits(3), for potash was $166 per ton in the fourth quarter of 2010. This compares to $186 per ton in the fourth quarter of 2009. There were no abnormal production costs recognized in the fourth quarter of 2010, whereas, in the comparable period of 2009, $8.8 million of abnormal production costs for potash were expensed in the period and were excluded from the cash operating cost of goods sold. Our fourth quarter 2010 cash operating cost of goods sold per ton results reflect all costs attributed to production of potash as we operated within normal ranges during this period. Sales of langbeinite, which we market as Trio(R), were 27,000 tons in the fourth quarter of 2010 compared to 25,000 tons in the fourth quarter of 2009. Langbeinite production in the fourth quarter of 2010 decreased to 31,000 tons from 45,000 tons produced in the fourth quarter of 2009. The average net realized sales price for Trio(R) was $222 per ton ($245 per metric tonne) in the fourth quarter of 2010 compared to $190 per ton ($209 per metric tonne) in the fourth quarter of 2009. Average gross margin in the fourth quarter of 2010 for the sale of potash was $169 per ton or 44 percent, compared to $173 per ton or 42 percent in the fourth quarter of 2009, which excluded the abnormal production expense incurred in this period. Average gross margin for the sale of Trio(R) was $38 per ton or 17 percent compared to $16 per ton or 8 percent in the same period of 2009. Capital investment in the fourth quarter of 2010 totaled $32.7 million. As of December 31, 2010, we had $143.0 million of cash and investments, no outstanding debt, and $125.0 million of availability under our revolving credit facility.

The strength of Intrepid's results can also be attributed, in large part, to the ability to serve the just-in-time truck market. "The flexibility that our locations afford us, coupled with our decision to manage inventories and support the local truck market, was integral to our solid results for the quarter," said Mr. Jornayvaz. "Not only were we able to service our traditional truck markets in the southern United States, but we were also able to meet customer demand for tons outside these locations as customers required timely delivery of product from suppliers to satisfy farmer demand."

Additionally, Mr. Jornayvaz stated, "Given the strong commodity-pricing environment and level of grain demand, we expect at least a normal spring season in terms of application rates as farmers look to maximize yield and margin. We believe Intrepid is well positioned to address the changing and growing needs of the domestic potassium nutrient market. Through the successful addition of the new compactor at our Moab, Utah facility, the anticipated enhancements from our Langbeinite Recovery Improvement Project, our continued focus on compaction at our Wendover and Carlsbad operations, and positive progress on developing the HB Solar Solution Mine, Intrepid is meeting customers' needs and creating value for our stockholders."

http://finance.yahoo.com/news/Intrepid-Announces-2010-bw-3411756741.html?x=0&.v=1

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