Compass Minerals Reports 2022 Results and 2023 Outlook
End of November, Compass Minerals reported its fiscal year 2022 results, and its 2023 outlook. Salt segment sales have increased by 9%, versus the comparable year-over-year period[1]. Growth was driven by a 15% increase in sales volumes and a 3% increase in average selling price.
The average price increase of 3% from 2021 to 2022 did not compensate for continued inflationary pressures and increased production and distribution costs. Operating earnings decreased 34% to $117.4 million, while EBITDA declined 27% to $181.9 million from the prior-year period.
For 2023, Compass Minerals expects stagnating sales volumes in the consumer and industrial segment between 2 and 2.15 million metric tons. In the de-icing segment, the company defined scenarios for mild- and strong winters, and associated de-icing salt consumption between 8 and 11 million metric tons.
For the salt segment in 2023, the company will focus on improving profitability to historical levels. Prices will increase, and the company announced to change its sales mix towards areas with higher profit margins. Compass Minerals expects its average contract price for the upcoming winter season to be approximately 15% above the prior year’s bid season results. Other salt producers in North America and Europe are expected to have similar results and challenges. Prices in 2023 are likely to further increase, in order to compensate for increasing production- and distribution cost.
[1] The company changed the fiscal year-end from Dec. 31 to Sept. 30. The fiscal 2022 results are reported for the twelve- month period from Oct. 1, 2021 to Sept. 30, 2022, and the results of the previous year 2021 are presented for the comparable Oct. 1, 2020 to Sept. 30, 2021 period.
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