Intrepid Potash, Inc. Q2 FY2025 earnings call

• Intrepid had strong second quarter results with adjusted EBITDA of $16.4 million and adjusted net income of $6 million. - AMAX cavern sample well project drilled in July but did not find the expected brine pool; continuing evaluation of options for an injection well and pipeline. - Potash market highlights: tight global supply and strong demand, supportive international contracts, summer field program price increase of $20 per ton, Jansen project delay to mid-2027. - Agriculture markets: some weakness in corn and soybean futures but weak U.S. dollar supports exports, trade deals help, non-corn/soybean crops comprise 70% of global potash consumption. - Focus on making core operations more durable and consistent, prioritizing investments for higher production and lower costs.

Potash Segment: In the second quarter, adjusted EBITDA was $16.4 million and adjusted net income was $6 million. Year-to-date potash production was 137,000 tons (8% higher than the same period in 2024), and cost of goods sold per ton improved by 12% to $323 per ton. For Q3, potash sales volumes are expected to be between 55,000 to 65,000 tons at an average net realized sales price range of $375 to $385 per ton. 2025-2026 potash production is now expected to be between 270,000 and 280,000 tons. Trio Segment: Second quarter sales were 70,000 tons at an average net realized sales price of $368 per ton. Year-to-date Trio production was 132,000 tons (8% higher than the same period in 2024), and cost of goods sold per ton improved by 18% to $234 per ton. For Q3, Trio sales volumes are expected to be between 27,000 to 37,000 tons at an average net realized sales price range of $383 to $393 per ton. Oilfield Solutions Segment: Second quarter revenue was $4.3 million and gross margin was $1.3 million (30% of revenue), in line with historical average.

• Potash Q3 sales volumes expected to be 55,000-65,000 tons at $375-$385 per ton. - Trio Q3 sales volumes expected to be 27,000-37,000 tons at $383-$393 per ton. - 2025 capital program CapEx guidance reduced to $32 million to $37 million due to AMAX well result, deferring spend on extraction well and pipeline while evaluating options at HB.

• AMAX cavern sample well did not find the expected brine pool, leading to lower near-term potash production and slightly lower brine grades in 2026. - Poor weather at HB facility led to reduced evaporation and lower production outlook. - Potential 8%-10% increase in cost per ton unless cost-cutting measures are implemented.

Q: Just wanted to kind of start on the changes to the production timing. So I mean, I think it's kind of clear that the temporary piece linked to rainfall in the short term. So you sort of pushed 15,000 tonnes of production there into '26. But then you've also reduced '26 by 40,000 tonnes overall, which was the 25,000 on AMAX plus another portion. I was just confused about out of the 15,000 that shifted into next year, is that netting off against the change from this year? Or is there a larger gap there given the timing shift as well?

A: Yes, happy to do that, Lucas. No, you're right. The total impact is the 45,000 tonnes in 2026, but we are netting that against kind of the shift of 15,000 tonnes from '25 into the '26 calendar year. So compared to previous forecast, we're down 30,000 tonnes for the calendar year '26.

Q: Just maybe following up a little bit on the production. I guess, can you try to frame all the CapEx that you did, a lot of that started with injection with the residence time underground this balance between 2025 and 2026 calendar year, how does that kind of look versus maybe more of a longer-term view of where your injection rates are overall into the system with some of that brine kind of getting saturated over time, maybe over a slightly longer time frame?

A: Yes. I do my best to answer that, Jason. I mean you're right. We've really focused on investing back in our core assets for HB. Our main focus has been keeping injection rates above our extraction rates to keep our caverns full, make sure that we're touching all that potash underground all the time. And so really maximizing the production out of each of our different caverns at HB. I mean, going forward, it's largely the same. We just want to make sure that we're keeping our caverns as full as possible. Certainly, as we look to 2026, one of the impacts now is we'll have to just pull on those existing caverns a little bit harder than we otherwise would have liked. Hoping we'd had one more kind of straw down there at the AMAX mine for the 2026 production. But we're encouraged by the trend. Obviously, the success we've had when we've refocused on our core assets and getting that brine underground, we've seen the results. And so like we said on the call, it's a bit of a speed bump for us for sure, but confident in our ability to execute at HB over the long term.