Core Points - Compass Minerals is involved in a settlement of consolidated derivative actions, which is subject to approval by the U.S. District Court for the District of Kansas [2][4] - The settlement includes corporate governance reforms to be adopted by the Board within 30 days after final approval [2][3] - The settlement is deemed to confer substantial benefits to Compass and its shareholders, and is considered fair and reasonable [3] Settlement Details - The settlement hearing is scheduled for October 14, 2025, where the Court will evaluate the fairness and adequacy of the settlement [4] - Plaintiffs' Counsel will seek approval for attorneys' fees amounting to $1,400,000 and service awards of up to $2,000 for each of the two plaintiffs [7] - Current stockholders have the option to appear at the hearing and must follow specific procedures to object to the settlement or fee requests [6][9] Objection Procedures - Written objections must be filed with the Court and sent to Plaintiffs' Counsel at least 14 days before the hearing [10][11] - Failure to object in the prescribed manner will result in waiving the right to contest the settlement [12] - The notice provides contact information for Plaintiffs' Counsel for any inquiries regarding the settlement [16]

Core Points - The United States District Court for the District of Kansas has approved a proposed class action settlement for purchasers of Compass Minerals International Inc. securities [1][2] - The settlement amount is set at $4,900,000, and a hearing is scheduled for November 18, 2025, to determine the fairness and adequacy of the settlement [4][5] - The settlement affects individuals who purchased Compass Minerals securities from February 8, 2023, through March 26, 2024 [4][5] Settlement Details - The proposed settlement includes a plan for distributing the settlement proceeds, which will be evaluated for fairness [4] - Lead Counsel has applied for an award of attorneys' fees of up to one-third of the settlement amount, plus interest, and reimbursement of expenses not exceeding $55,000 [4] - A service payment of no more than $17,500 is proposed for the plaintiffs [4] Participation and Exclusion - Individuals wishing to participate in the settlement must submit a Claim Form by October 7, 2025 [5][6] - Those who wish to be excluded from the settlement class must submit a request for exclusion by the same date [6] - Members of the settlement class who do not request exclusion will be bound by the judgment entered in the action [6] Objections - Any objections to the settlement or the plan of allocation must be submitted by October 21, 2025 [7] - The detailed process for objections is outlined in the Notice provided to class members [7]

Financial Data and Key Metrics Changes - Consolidated revenue for Q3 2025 was $215 million, an increase of approximately 6% year over year [12] - Operating income improved to $15.9 million from $5.9 million in the prior year [12] - Consolidated net loss decreased to $17 million compared to a net loss of $43.6 million in the prior year [12] - Adjusted EBITDA increased by 25% to $41 million, up from $32.8 million a year ago [12][17] - Total net debt as of June 30, 2025, was $746 million, down $116 million or 13% year over year [16] Business Line Data and Key Metrics Changes - In the Salt business, revenue for Q3 was $166 million, compared to $160.6 million a year ago, with pricing down 1% to approximately $108 per ton and volumes up 4% [13] - Net revenue per ton decreased 1% to $75, while operating earnings per ton increased 4% year over year to $18.2 [13] - In the Plant Nutrition business, revenue for Q3 was $45 million, up 15% year over year from $39 million, with sales volume increasing 1% and pricing down 5% [13] Market Data and Key Metrics Changes - North American highway deicing inventory value and volumes increased sequentially by 27% [14] - As of June, North American highway deicing inventory levels were approximately 50% lower than last year [14] Company Strategy and Development Direction - The company is focused on a "back to basics" strategy aimed at improving cash flow generation by optimizing business practices and lowering capital intensity [9][10] - The strategy emphasizes value over volume in sales, particularly in the context of the upcoming deicing season [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the progress made in improving the cost structure and productivity at the Ogden plant [7] - The company expects contracted selling prices for the upcoming deicing season to be up 2% to 4% year over year, with committed bid volumes up 3% to 5% [8] - Management noted that the financial position was strengthened by the refinancing and the sale of fortress assets, enhancing liquidity and financial flexibility [9][16] Other Important Information - The company has increased its adjusted EBITDA guidance for the year to $193 million, up from $188 million [17] - Capital expenditure guidance remains unchanged at a range of $75 million to $85 million [17] Q&A Session Summary Question: Can you help us understand the pricing and netbacks for the upcoming winter? - Management indicated that the focus is on value over volume and that guidance will be provided after the budgeting process is completed [21] Question: How did the bid season play out compared to expectations? - Management noted that while volumes were up, pricing was in line with historical averages, and the market dynamics were influenced by the previous winter's weather [22][25] Question: What were the unique factors affecting costs in Q3 and Q4? - Management explained that the recovery plan for Plant Nutrition is ongoing, with improvements in production and costs expected to continue [27][30] Question: What are the company's targets for leverage on a normalized EBITDA basis? - Management aims to achieve an investment-grade rating, targeting a debt to EBITDA ratio of around 2.5 [40]

Financial Performance - The company's net loss for the third quarter of fiscal 2025 was $17 million, improved from a net loss of $43.6 million in the third quarter of fiscal 2024[10] - Total company adjusted EBITDA for the third quarter of fiscal 2025 was $41 million, a 25% increase from $32.8 million in the prior year[10] - Net total debt decreased by 13% year over year and 2% sequentially to $746 million, with liquidity of $389 million as of June 30, 2025[10] - Consolidated revenue increased by 6% year-over-year[17] - Consolidated adjusted EBITDA margin was 19.1%[17] Salt Segment - Salt sales volumes increased by 4% year over year[10] - Salt segment revenue was $166 million, up 3.4% from $160.6 million in 3Q24[21] - Salt segment adjusted EBITDA was $45.8 million, up 10.1% from $41.6 million in 3Q24[21] - Salt adjusted EBITDA margin was 27.6%, an increase of 1.7 percentage points from 25.9% in 3Q24[21] Plant Nutrition Segment - Plant Nutrition sales volumes increased by 21% year over year, reaching 68 thousand short tons[10, 29] - Plant Nutrition revenue was $44.8 million, up 15.5% from $38.8 million in 3Q24[29] - Plant Nutrition adjusted EBITDA increased to $11.4 million from $7.2 million[29, 31] - Plant Nutrition adjusted EBITDA margin was 25.4%, an increase of 6.9 percentage points from 18.6% in 3Q24[29]

Group 1 - Compass Minerals reported a quarterly loss of $0.39 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.13, but an improvement from a loss of $1.01 per share a year ago, indicating a significant earnings surprise of -200.00% [1] - The company posted revenues of $214.6 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 2.89% and showing an increase from $202.9 million in the same quarter last year [2] - Compass has outperformed the S&P 500, with its shares gaining about 90.6% since the beginning of the year compared to the S&P 500's gain of 8.6% [3] Group 2 - The earnings outlook for Compass is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The trend of estimate revisions for Compass was favorable ahead of the earnings release, resulting in a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] - The current consensus EPS estimate for the upcoming quarter is -$0.16 on revenues of $212.26 million, and for the current fiscal year, it is -$0.40 on revenues of $1.23 billion [7] Group 3 - The Chemical - Diversified industry, to which Compass belongs, is currently in the bottom 9% of over 250 Zacks industries, suggesting that the industry outlook could materially impact the stock's performance [8]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for Compass Minerals International, Inc. for the three and nine months ended June 30, 2025, and June 30, 2024, covering balance sheets, operations, cash flows, and related notes [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to **$1,537.4 million** as of June 30, 2025, from **$1,640.1 million** as of September 30, 2024, primarily due to reduced inventories and intangible assets, while total stockholders' equity declined to **$249.8 million** Consolidated Balance Sheet Summary (in millions) | Account | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $79.4 | $20.2 | | Inventories | $264.7 | $414.1 | | Total current assets | $570.6 | $587.3 | | Property, plant and equipment, net | $773.8 | $806.5 | | **Total assets** | **$1,537.4** | **$1,640.1** | | **Liabilities & Equity** | | | | Total current liabilities | $265.1 | $217.0 | | Long-term debt, net | $825.3 | $910.0 | | **Total stockholders' equity** | **$249.8** | **$316.6** | | **Total liabilities and stockholders' equity** | **$1,537.4** | **$1,640.1** | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) Sales for the three months ended June 30, 2025, increased to **$214.6 million**, with net loss narrowing to **$(17.0) million**, while nine-month sales grew to **$1,016.4 million**, and net loss significantly decreased to **$(72.6) million** due to lower impairment charges Consolidated Statements of Operations Summary (in millions, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Sales | $214.6 | $202.9 | $1,016.4 | $908.6 | | Gross profit | $41.2 | $32.6 | $152.3 | $175.5 | | Operating income (loss) | $15.9 | $5.9 | $13.3 | $(87.0) | | Net loss | $(17.0) | $(43.6) | $(72.6) | $(157.8) | | Diluted net loss per common share | $(0.41) | $(1.05) | $(1.74) | $(3.83) | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities for the nine months ended June 30, 2025, significantly improved to **$204.6 million** from **$27.1 million** in the prior year, while financing activities used **$111.5 million** primarily for debt restructuring Consolidated Cash Flow Summary (in millions) | Cash Flow Activity | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $204.6 | $27.1 | | Net cash used in investing activities | $(34.7) | $(95.0) | | Net cash (used in) provided by financing activities | $(111.5) | $42.2 | | Net change in cash and cash equivalents | $59.2 | $(25.9) | | Cash and cash equivalents, end of period | $79.4 | $12.8 | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, segment information, debt, and legal contingencies, highlighting the strategic exit from the Fortress business, significant debt refinancing in June 2025, and a securities class action settlement covered by insurance - The company is exiting the Fortress fire retardant business, which resulted in impairment charges of **$53.7 million** for the nine months ended June 30, 2025. Substantially all Fortress assets were subsequently sold for **$20.0 million** in cash[26](index=26&type=chunk)[27](index=27&type=chunk)[32](index=32&type=chunk) - In June 2025, the company issued **$650.0 million** of **8.00%** Senior Notes due 2030. Proceeds were used to repay the term loan, redeem **$350.0 million** of its **6.75%** Senior Notes due 2027, and for general corporate purposes[55](index=55&type=chunk)[56](index=56&type=chunk) - The company reached an agreement to settle a securities class action lawsuit for **$48.0 million**. The company's insurers have consented to and committed to pay the settlement amount[67](index=67&type=chunk)[68](index=68&type=chunk) - A valuation allowance of **$29.0 million** was recorded against U.S. deferred tax assets during the nine months ended June 30, 2025, due to a cumulative loss position in the U.S. over the last three years[47](index=47&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q3 and nine-month fiscal 2025 financial results, highlighting improved operating income from higher sales and lower impairment charges, segment performance, the Fortress business exit, significant debt refinancing, and the full fiscal year 2025 outlook [Consolidated Results of Operations](index=29&type=section&id=Consolidated%20Results%20of%20Operations) Q3 fiscal 2025 total sales increased **6%** to **$214.6 million**, with operating income rising to **$15.9 million**, while nine-month sales grew **12%** to **$1,016.4 million**, achieving **$13.3 million** operating income, a significant turnaround from a prior-year loss due to lower impairment charges Q3 Financial Performance Comparison (in millions) | Metric | Q3 2025 | Q3 2024 | Change | | :--- | :--- | :--- | :--- | | Total Sales | $214.6 | $202.9 | +$11.7M (+6%) | | Operating Income | $15.9 | $5.9 | +$10.0M | | Net Loss | $(17.0) | $(43.6) | +$26.6M | | Diluted EPS | $(0.41) | $(1.05) | +$0.64 | Nine-Month Financial Performance Comparison (in millions) | Metric | YTD 2025 | YTD 2024 | Change | | :--- | :--- | :--- | :--- | | Total Sales | $1,016.4 | $908.6 | +$107.8M (+12%) | | Operating Income (Loss) | $13.3 | $(87.0) | +$100.3M | | Net Loss | $(72.6) | $(157.8) | +$85.2M | | Diluted EPS | $(1.74) | $(3.83) | +$2.09 | - The significant improvement in nine-month operating income was primarily due to lower impairment charges. The current period included a **$53.7 million** impairment for the Fortress business exit, whereas the prior year had **$173.4 million** in impairments related to lithium, Fortress, and Plant Nutrition goodwill[10](index=10&type=chunk)[135](index=135&type=chunk)[153](index=153&type=chunk) [Operating Segment Performance](index=34&type=section&id=Operating%20Segment%20Performance) The Salt segment's Q3 sales increased **3%** to **$166.0 million** with operating earnings of **$28.1 million**, while nine-month operating earnings fell to **$124.4 million**; Plant Nutrition's Q3 sales rose **15%** to **$44.8 million**, achieving a **$5.2 million** profit, and nine-month operating results improved to **$0.3 million** earnings Salt Segment Performance | Metric | Q3 2025 | Q3 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Sales (in millions) | $166.0 | $160.6 | $840.9 | $745.3 | | Operating Earnings (in millions) | $28.1 | $25.9 | $124.4 | $142.6 | | Total Tons Sold (thousands) | 1,544 | 1,483 | 9,142 | 7,804 | Plant Nutrition Segment Performance | Metric | Q3 2025 | Q3 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Sales (in millions) | $44.8 | $38.8 | $164.5 | $138.6 | | Operating Earnings (Loss) (in millions) | $5.2 | $(1.4) | $0.3 | $(56.7) | | Sales Volumes (thousands of tons) | 68 | 56 | 263 | 205 | [Outlook](index=36&type=section&id=Outlook) For fiscal year 2025, the company projects Salt segment sales volumes of **10.7M-11.0M tons** and adjusted EBITDA of **$220M-$229M**, Plant Nutrition sales volumes of **320K-325K tons** and adjusted EBITDA of **$24M-$27M**, with capital expenditures of **$75M-$85M** - Fiscal Year 2025 Guidance: - **Salt Segment:** Sales volumes of **10.7M to 11.0M tons**; Adjusted EBITDA of **$220M to $229M** - **Plant Nutrition Segment:** Sales volumes of **320,000 to 325,000 tons**; Adjusted EBITDA of **$24M to $27M** - **Capital Expenditures:** Expected to be **$75M to $85M**[174](index=174&type=chunk) - Based on bidding for the upcoming winter season, the company expects its average North American highway deicing contract selling price to be **2% to 4%** higher than in fiscal 2025, with committed bid volumes up **3% to 5%**[174](index=174&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, total liquidity was **$388.7 million**, with nine-month net cash from operations significantly increasing to **$204.6 million**; the company completed a major debt refinancing by issuing **$650 million** in new **8.00%** Senior Notes and suspended dividends to prioritize debt reduction - Total liquidity as of June 30, 2025, was **$388.7 million**, comprising **$79.4 million** of cash and **$309.3 million** of availability under its revolving credit facility[178](index=178&type=chunk) - The company issued **$650.0 million** of **8.00%** Senior Notes due 2030 and used proceeds to repay its term loan and redeem **$350.0 million** of its **6.75%** Senior Notes due 2027, resulting in a **$7.6 million** loss on debt extinguishment[187](index=187&type=chunk)[188](index=188&type=chunk)[142](index=142&type=chunk) - The credit agreement was amended to fix revolving commitments at **$325.0 million** and modify financial covenants, replacing the total net leverage ratio with a first lien net leverage ratio and lowering the interest coverage ratio requirement[190](index=190&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company faces market risks from interest rate fluctuations, foreign currency (CAD, GBP), and commodity pricing (natural gas), using derivatives to mitigate some exposures, with no material change in risk since the last fiscal year-end - The company's primary market risks are interest rate risk, foreign currency exchange rate risk, and commodity pricing risk. It uses derivatives to hedge commodity and foreign currency risks and does not engage in speculative trading[207](index=207&type=chunk) [Item 4. Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) Management deemed disclosure controls and procedures ineffective as of September 30, 2024, due to material weaknesses in risk assessment and information/communication processes, with active remediation efforts underway including enhanced risk assessment and new accounting personnel - The CEO and CFO concluded that disclosure controls and procedures were ineffective due to material weaknesses in internal control over financial reporting[208](index=208&type=chunk) - The material weaknesses stem from an ineffective risk assessment process and an ineffective information and communication process, which led to deficiencies in process-level controls throughout financial reporting[214](index=214&type=chunk) - Remediation efforts are in progress, including enhancing the risk assessment process, hiring additional accounting professionals with technical expertise, and redesigning controls over manual journal entries and balance sheet reconciliations[216](index=216&type=chunk) [PART II. OTHER INFORMATION](index=45&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=45&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to detailed disclosures on legal proceedings in Note 6 (Income Taxes) and Note 8 (Commitments and Contingencies) of the financial statements, with no material developments since September 30, 2024, beyond those notes - The company is involved in various legal proceedings, with detailed information provided in Note 6 (Income Taxes) and Note 8 (Commitments and Contingencies) of the financial statements[217](index=217&type=chunk) [Item 1A. Risk Factors](index=45&type=section&id=Item%201A.%20Risk%20Factors) This section directs readers to the company's Annual Report on Form 10-K for the fiscal year ended September 30, 2024, for a comprehensive discussion of applicable business risk factors - For a discussion of applicable risk factors, the report refers to Part I, Item 1A of the company's Annual Report on Form 10-K for the year ended September 30, 2024[218](index=218&type=chunk) [Item 4. Mine Safety Disclosures](index=45&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section indicates that information on mine safety violations and related regulatory matters, as required by the Dodd-Frank Act, is included in Exhibit 95 of this Quarterly Report - Information regarding mine safety violations as required by Section 1503(a) of the Dodd-Frank Act is included in Exhibit 95 to this Form 10-Q[220](index=220&type=chunk) [Item 6. Exhibits](index=46&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including the indenture for the new **8.000%** Senior Notes, the fifth amendment to the credit agreement, and CEO/CFO certifications - Key exhibits filed include the Indenture for the **8.000%** Senior Notes due 2030 (Exhibit 4.1) and Amendment No. 5 to the Credit Agreement (Exhibit 10.1)[223](index=223&type=chunk)

[Fiscal 2025 Third-Quarter Financial Highlights](index=1&type=section&id=Fiscal%202025%20Third-Quarter%20Financial%20Highlights) The company reported significant year-over-year improvements in key financial metrics, driven by strong performance in both Salt and Plant Nutrition segments [Management Commentary](index=1&type=section&id=Management%20Commentary) Management highlighted strong third-quarter results with improved margins in Salt and increased operating income in Plant Nutrition, alongside enhanced financial flexibility - Salt Business: Costs declined, leading to **adjusted EBITDA margin expansion** and per-ton growth[2](index=2&type=chunk) - Plant Nutrition Business: Benefited from stronger sales volumes and lower production costs, driving improvements in operating income and adjusted EBITDA[2](index=2&type=chunk) - Financial Strategy: The company enhanced financial flexibility through refinancing and reduced net debt with the sale of certain Fortress assets[2](index=2&type=chunk) [Quarterly Financial Results](index=1&type=section&id=Quarterly%20Financial%20Results) Compass Minerals achieved a significant year-over-year improvement in its third-quarter fiscal 2025 results, narrowing its net loss and increasing adjusted EBITDA Q3 FY2025 Key Financial Metrics (vs. Q3 FY2024) | Metric | Q3 2025 | Q3 2024 | Change | | :--- | :--- | :--- | :--- | | **Revenue** | $214.6M | $202.9M | +5.8% | | **Net Loss** | $(17.0)M | $(43.6)M | Improved | | **Net Loss per Diluted Share** | $(0.41) | $(1.05) | Improved | | **Adjusted EBITDA** | $41.0M | $32.8M | +25.0% | | **Adjusted Net Loss per Diluted Share** | $(0.39) | $(1.01) | Improved | - Salt business sales volumes increased by **4%** year-over-year[3](index=3&type=chunk) - Plant Nutrition sales volumes saw a significant **21%** increase compared to the prior year period[3](index=3&type=chunk) [Business Segment Performance](index=2&type=section&id=Business%20Segment%20Performance) Both the Salt and Plant Nutrition segments demonstrated improved profitability, driven by increased sales volumes and reduced production costs [Salt Business](index=2&type=section&id=Salt%20Business) The Salt segment reported increased revenue and significantly improved profitability, driven by higher sales volumes and a decline in all-in product costs per ton Salt Segment Q3 FY2025 Performance | Metric | Q3 2025 | Q3 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Revenue** | $166.0M | $160.6M | +3% | | **Sales Volumes** | 1,544k tons | 1,483k tons | +4% | | **Operating Earnings** | $28.1M | $25.9M | +9% | | **Adjusted EBITDA** | $45.8M | $41.6M | +10% | | **Adjusted EBITDA per ton** | $29.66 | $27.98 | +6% | - Highway deicing sales volumes increased **5%** year-over-year, while Consumer and Industrial (C&I) sales volumes grew by **2%**[5](index=5&type=chunk) - All-in product costs per ton declined **2%** from the prior-year quarter, contributing to margin expansion[6](index=6&type=chunk) [Plant Nutrition Business](index=2&type=section&id=Plant%20Nutrition%20Business) The Plant Nutrition segment achieved strong revenue growth and a dramatic turnaround in profitability, primarily due to a substantial reduction in product costs Plant Nutrition Segment Q3 FY2025 Performance | Metric | Q3 2025 | Q3 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Revenue** | $44.8M | $38.8M | +15% | | **Sales Volumes** | 68k tons | 56k tons | +21% | | **Operating Earnings (Loss)** | $5.2M | $(1.4)M | Turnaround | | **Adjusted EBITDA** | $11.4M | $7.2M | +58% | - The average sales price per ton decreased by **5%** year-over-year to approximately **$659**, reflecting global supply conditions for potassium-based fertilizers[7](index=7&type=chunk) - A significant **23%** year-over-year decrease in all-in product costs per ton was a key driver of the improved profitability[8](index=8&type=chunk) [Financial Position and Cash Flow](index=3&type=section&id=Financial%20Position%20and%20Cash%20Flow) The company demonstrated robust cash flow generation and maintained a strong liquidity position, supported by inventory reduction and strategic asset sales [Cash Flow Analysis](index=3&type=section&id=Cash%20Flow%20Analysis) For the first nine months of fiscal 2025, the company significantly improved cash from operating activities and reduced cash used in investing activities Nine Months Ended June 30 Cash Flow Summary (in millions) | Cash Flow Activity | FY2025 | FY2024 | | :--- | :--- | :--- | | **Net Cash from Operating Activities** | $204.6 | $27.1 | | **Net Cash used in Investing Activities** | $(34.7) | $(95.0) | | **Net Cash (used in) provided by Financing Activities** | $(111.5) | $42.2 | - The primary driver for the significant improvement in operating cash flow was a reduction in salt inventory levels[9](index=9&type=chunk) - The company received net proceeds of **$19.6 million** from the sale of assets related to its exit from the fire retardant business[10](index=10&type=chunk) [Liquidity and Financial Position](index=3&type=section&id=Liquidity%20and%20Financial%20Position) Compass Minerals concluded the third quarter with substantial liquidity, comprising cash and available revolving credit, ensuring strong financial flexibility Liquidity Position as of June 30, 2025 | Component | Amount (in millions) | | :--- | :--- | | Cash and cash equivalents | $79.4 | | Availability under revolving credit facility | $309.3 | | **Total Liquidity** | **$388.7** | [Fiscal 2025 Outlook and Bid Season Update](index=4&type=section&id=Fiscal%202025%20Outlook%20and%20Bid%20Season%20Update) The company has updated its fiscal 2025 guidance, projecting increased adjusted EBITDA, and anticipates positive pricing and volume trends for the upcoming North American bid season [Updated Fiscal 2025 Guidance](index=4&type=section&id=Updated%20Fiscal%202025%20Guidance) The company has refined its full-year fiscal 2025 guidance, projecting an increased range for total adjusted EBITDA and providing segment-specific contributions FY2025 Adjusted EBITDA Guidance (in millions) | Segment | 2025 Range | | :--- | :--- | | Salt | $220 - $229 | | Plant Nutrition | $24 - $27 | | Corporate | ($59) - ($55) | | **Total Compass Minerals** | **$185 - $201** | FY2025 Other Guidance | Metric | 2025 Range | | :--- | :--- | | **Capital Expenditures** | $75M - $85M | | **Interest Expense, net** | $70M - $75M | | **Depreciation, depletion and amortization** | $105M - $115M | [2025/2026 North American Bid Season Update](index=5&type=section&id=2025%2F2026%20North%20American%20Bid%20Season%20Update) With approximately 70% of the bidding process complete, the company expects favorable pricing and volume increases for the upcoming North American highway deicing season - Expected average contract selling price for the upcoming season to be **2%-4%** higher than fiscal 2025[22](index=22&type=chunk) - Committed bid volumes are expected to increase by approximately **3%-5%** compared to fiscal 2025[22](index=22&type=chunk) [Appendix: Financial Statements and Reconciliations](index=7&type=section&id=Appendix%3A%20Financial%20Statements%20and%20Reconciliations) This appendix provides comprehensive financial data, including detailed non-GAAP reconciliations and unaudited GAAP financial statements for the reported periods [Non-GAAP Reconciliations](index=7&type=section&id=Non-GAAP%20Reconciliations) This section provides detailed reconciliations of non-GAAP financial measures, such as Adjusted EBITDA, to their most directly comparable GAAP counterparts, used by management to assess core business performance Reconciliation of Net Loss to Adjusted EBITDA (Q3 FY2025) | (in millions) | Amount | | :--- | :--- | | **Net loss** | **$(17.0)** | | Interest expense | 16.3 | | Income tax expense | 3.4 | | Depreciation, depletion and amortization | 23.2 | | **EBITDA** | **25.9** | | Adjustments (Loss on debt extinguishment, etc.) | 15.1 | | **Adjusted EBITDA** | **$41.0** | - Special items adjusted in the nine months ended June 30, 2025, totaled **$60.0 million** before tax, primarily consisting of **$53.7 million** in impairments related to the exit of the Fortress business[33](index=33&type=chunk) [Consolidated Financial Statements](index=16&type=section&id=Consolidated%20Financial%20Statements) This section includes the company's unaudited GAAP financial statements, encompassing the Consolidated Statements of Operations, Balance Sheets, Cash Flows, and Segment Information [Consolidated Statements of Operations](index=16&type=section&id=Consolidated%20Statements%20of%20Operations) The company reported a narrowed net loss for both the third quarter and the nine-month period of fiscal 2025, indicating improved operational performance Nine Months Ended June 30 Results (in millions) | Line Item | 2025 | 2024 | | :--- | :--- | :--- | | **Sales** | $1,016.4 | $908.6 | | **Gross Profit** | $152.3 | $175.5 | | **Operating Income (Loss)** | $13.3 | $(87.0) | | **Net Loss** | $(72.6) | $(157.8) | [Condensed Consolidated Balance Sheets](index=17&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, the company's total assets decreased primarily due to reduced inventories, while total long-term debt also saw a notable reduction Balance Sheet Highlights (in millions) | Account | June 30, 2025 | Sept. 30, 2024 | | :--- | :--- | :--- | | **Total Assets** | $1,537.4 | $1,640.1 | | Inventories, net | $264.7 | $414.1 | | **Total Liabilities** | $1,287.6 | $1,323.5 | | Long-term debt, net | $825.3 | $910.0 | | **Total Stockholders' Equity** | $249.8 | $316.6 | [Consolidated Statements of Cash Flows](index=18&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended June 30, 2025, the company generated significant cash from operating activities, while managing investing and financing outflows - A significant positive change in inventories contributed **$138.0 million** to operating cash flow for the nine-month period[65](index=65&type=chunk) - Major financing activities included net repayments under the revolving credit facility and debt refinancing, including the issuance of 2030 Notes and repurchase of 2027 Notes[65](index=65&type=chunk) [Segment Information](index=19&type=section&id=Segment%20Information) For the nine months ended June 30, 2025, the Salt segment was the primary revenue and earnings driver, while Plant Nutrition also contributed positively to operating earnings Nine Months Ended June 30, 2025 Segment Results (in millions) | Segment | Sales to External Customers | Operating Earnings (Loss) | | :--- | :--- | :--- | | **Salt** | $840.9 | $124.4 | | **Plant Nutrition** | $164.5 | $0.3 | | **Corporate & Other** | $11.0 | $(111.4) | | **Total** | **$1,016.4** | **$13.3** |

Group 1 - Compass Minerals (CMP) has significantly outperformed its peers in the Basic Materials sector, returning approximately 77.2% year-to-date compared to the sector average of 8.8% [4] - The Zacks Rank for Compass Minerals is currently 2 (Buy), indicating a positive outlook based on earnings estimates and revisions, with a 25% increase in the consensus estimate for full-year earnings over the past quarter [3] - Compass Minerals is part of the Chemical - Diversified industry, which has seen an average loss of 16.8% this year, further highlighting CMP's strong performance relative to its industry [5] Group 2 - The Basic Materials sector includes 238 individual stocks and holds a Zacks Sector Rank of 12 among 16 sector groups, indicating a relatively lower performance compared to other sectors [2] - Posco (PKX), another stock in the Basic Materials sector, has also outperformed with a year-to-date return of 26%, and it currently holds a Zacks Rank of 2 (Buy) [4][5] - The Steel - Producers industry, to which Posco belongs, has a year-to-date gain of 18.4%, ranking 208 among industries, which is lower than the performance of Compass Minerals [6]

Company Overview - Akzo Nobel NV (AKZOY) is part of the Basic Materials group, which consists of 238 companies and ranks 7 in the Zacks Sector Rank [2] - The company currently holds a Zacks Rank of 2 (Buy), indicating a favorable outlook [3] Performance Analysis - Year-to-date, Akzo Nobel NV has returned approximately 16.6%, outperforming the Basic Materials sector average return of 11.2% [4] - In comparison, another Basic Materials stock, Compass Minerals (CMP), has significantly outperformed with a return of 94.4% year-to-date [4] Earnings Estimates - Over the past 90 days, the Zacks Consensus Estimate for Akzo Nobel NV's full-year earnings has increased by 8.8%, reflecting improved analyst sentiment [3] - Compass Minerals has also seen a positive trend, with its consensus EPS estimate rising by 25.2% over the last three months [5] Industry Context - Akzo Nobel NV belongs to the Chemical - Diversified industry, which includes 29 companies and currently ranks 228 in the Zacks Industry Rank [6] - The average return for this industry has been a loss of 12.8% year-to-date, indicating that Akzo Nobel NV is performing better than its industry peers [6] Future Outlook - Investors interested in Basic Materials stocks should monitor Akzo Nobel NV and Compass Minerals for potential continued strong performance [7]

Core Viewpoint - Compass Minerals (CMP) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on a company's changing earnings picture, specifically the consensus of EPS estimates from sell-side analysts [1][2]. - Changes in future earnings potential, as indicated by earnings estimate revisions, are strongly correlated with near-term stock price movements [4][6]. - Rising earnings estimates for Compass suggest an improvement in the company's underlying business, likely leading to increased stock prices [5][10]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) to Zacks Rank 5 (Strong Sell) [7]. - Historically, Zacks Rank 1 stocks have generated an average annual return of +25% since 1988, indicating the effectiveness of the system [7]. - The upgrade of Compass to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10]. Earnings Estimate Revisions for Compass - For the fiscal year ending September 2025, Compass is expected to earn -$0.33 per share, with no year-over-year change [8]. - Over the past three months, the Zacks Consensus Estimate for Compass has increased by 39.2%, reflecting positive sentiment among analysts [8].