COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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Delaware
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36-3972986
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(State or other jurisdiction of incorporation or
organization)
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(I.R.S. Employer Identification No.)
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9900 West 109
th
Street, Suite 100
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66210
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Overland Park, Kansas
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(Zip Code)
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(Address of principal executive offices)
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Title of each class
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Name of each exchange on which registered
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Common stock, par value $0.01 per share
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New York Stock Exchange
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Large accelerated filer
þ
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Accelerated filer ☐
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Non-accelerated filer ☐
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Smaller reporting company ☐
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Document
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Parts into which Incorporated
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Portions of the Proxy Statement for the Annual Meeting of Stockholders to be held May 4, 2016
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Part III, Items 10, 11, 12, 13 and 14
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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PART I
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Page No.
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4
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15
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24
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24
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24
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24
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PART II
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26
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28
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29
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42
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44
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77
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77
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77
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PART III
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78
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78
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78
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78
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78
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PART IV
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79
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SIGNATURES
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84
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1
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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•
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hazards of mining, including acts of nature;
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•
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uninsured risks;
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•
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difficulties or delays in receiving or renewing required governmental or regulatory approvals;
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•
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the impact of new technology on the demand for our products;
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•
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the price or lack of availability of transportation services;
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•
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agricultural economics, customer expectations about future plant nutrition market prices, and customer application rates;
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•
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weather conditions;
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•
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cyber security issues;
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•
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the ability to attract and retain skilled personnel or avoid a disruption in our workforce;
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•
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the impact of competitive products;
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•
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governmental policies affecting highway maintenance programs, or consumer, industrial or agricultural sectors in localities where we or our customers operate;
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•
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pressure on prices realized for our products;
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•
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constraints on supplies and prices of raw materials and energy used in manufacturing certain of our products;
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•
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changes in tax laws or estimates;
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•
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domestic and international general business and economic conditions;
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•
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foreign exchange rates and their fluctuations;
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•
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the effects of and changes in trade, monetary, environmental and fiscal policies, laws and regulations;
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•
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the costs and effects of legal and tax proceedings, including environmental and administrative proceedings;
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•
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the impact of indebtedness and interest rates, including access to additional credit and capital markets;
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2
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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•
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the ability to complete the acquisition of our unconsolidated equity investee;
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•
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the ability to successfully complete acquisitions or integrate acquired businesses;
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•
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misappropriation or infringement claims relating to intellectual property;
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•
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capacity constraints limiting the production of certain products;
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•
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difficulties or delays in the development, production, testing and marketing of products;
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market acceptance issues, including the failure of products to generate anticipated sales levels; and
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•
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other risk factors included in this Form 10-K or reported from time to time in our filings with the Securities and Exchange Commission ("SEC"). See "Where You Can Find More Information."
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3
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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4
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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5
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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Location
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Annual
Production
Capacity
(a)
(tons)
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Product Type
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North America
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Goderich, Ontario, Mine
(b)
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8,000,000
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Rock Salt
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Cote Blanche, Louisiana, Mine
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3,000,000
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Rock Salt
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Ogden, Utah:
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Salt
(c)
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1,500,000
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Solar Salt
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Magnesium Chloride
(d)
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750,000
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Magnesium Chloride
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Lyons, Kansas, Plant
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450,000
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Evaporated Salt
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Unity, Saskatchewan, Plant
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160,000
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Evaporated Salt
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Goderich, Ontario, Plant
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130,000
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Evaporated Salt
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Amherst, Nova Scotia, Plant
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130,000
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Evaporated Salt
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United Kingdom
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Winsford, Cheshire, Mine
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1,500,000
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Rock Salt
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6
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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7
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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8
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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9
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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10
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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11
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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Land and Related Surface Rights
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Mineral Reserves
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Location
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Use
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Owned/
Leased
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Expiration of
Lease
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Owned/
Leased
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Expiration of
Lease
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Cote Blanche, Louisiana
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Rock salt production facility
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Leased
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2060
(1)
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Leased
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2060
(1)
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Lyons, Kansas
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Evaporated salt production facility
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Owned
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N/A
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Owned
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N/A
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Ogden, Utah
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SOP, solar salt and magnesium
chloride production facility
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Owned
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N/A
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Leased
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(2)
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Wynyard, Saskatchewan, Canada
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SOP production facility
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Owned
(3)
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N/A
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Leased
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2020
(4)
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Amherst, Nova Scotia, Canada
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Evaporated salt production facility
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Owned
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N/A
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Leased
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2023
(5)
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Goderich, Ontario, Canada
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Rock salt production facility
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Owned
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N/A
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Leased
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2022
(5)
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Goderich, Ontario, Canada
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Evaporated salt production facility
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Owned
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N/A
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Owned
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N/A
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Unity, Saskatchewan, Canada
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Evaporated salt production facility
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Owned
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N/A
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Leased
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2016/2030
(6)
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Winsford, Cheshire, United Kingdom
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Rock salt production facility; records
management
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Owned
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N/A
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Owned
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N/A
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London, United Kingdom
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Records management
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Leased
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2028
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N/A
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N/A
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Overland Park, Kansas
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Corporate headquarters
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Leased
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2020
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N/A
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N/A
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(1)
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The Cote Blanche lease was amended in 2014 to include two 25-year renewal options.
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(2)
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The Ogden lease renews on an annual basis.
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(3)
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The Wynyard location also has leases expiring in 2016 for two parcels of land.
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(4)
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The Wynyard mineral lease may be renewed for additional 20-year periods.
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(5)
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Subject to our right of renewal through 2043.
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(6)
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Consists of two leases expiring in 2016 and 2030 subject to our right of renewal through 2037 and 2051, respectively.
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12
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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13
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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14
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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15
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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16
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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17
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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18
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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19
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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•
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changes in currency exchange rates;
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•
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exchange controls;
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•
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tariffs, other trade protection measures, and import or export licensing requirements;
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•
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potentially negative consequences from changes in tax laws;
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•
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differing labor regulations;
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•
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requirements relating to withholding taxes on remittances and other payments by subsidiaries;
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•
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restrictions on our ability to own or operate subsidiaries, make investments, or acquire new businesses in these jurisdictions;
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•
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restrictions on our ability to repatriate dividends from our subsidiaries; and
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•
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changes in regulatory requirements.
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20
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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21
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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•
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it may limit our ability to borrow money or sell stock to fund our working capital, capital expenditures and debt service requirements;
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•
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it may limit our flexibility in planning for, or reacting to, changes in our business;
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•
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we may be more highly leveraged than some of our competitors, which may place us at a competitive disadvantage;
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•
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it may make us more vulnerable to a downturn in our business or the economy;
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•
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it may require us to dedicate a substantial portion of our cash flow from operations to the repayment of our indebtedness, thereby reducing the availability of our cash flow for other purposes; and
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•
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it may materially and adversely affect our business and financial condition, if we are unable to service our indebtedness or obtain additional financing, as needed.
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•
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incur additional indebtedness or contingent obligations;
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•
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pay dividends or make distributions to our stockholders;
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•
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repurchase or redeem our stock;
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•
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make investments;
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•
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grant liens;
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•
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enter into transactions with our stockholders and affiliates;
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•
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sell assets; and
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•
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acquire the assets of, or merge or consolidate with, other companies.
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22
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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23
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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24
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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Name
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Age
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Position
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Steven N. Berger
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50
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Senior Vice President, Corporate Services
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Keith E. Espelien
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56
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Senior Vice President, Plant Nutrition
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Matthew J. Foulston
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51
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Chief Financial Officer
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David J. Goadby
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61
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Senior Vice President, Corporate Development
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Jack C. Leunig
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62
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Senior Vice President, Operations
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Francis J. Malecha
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51
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President, Chief Executive Officer and Director
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Robert D. Miller
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58
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Senior Vice President, Salt
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Diana C. Toman
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37
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Senior Vice President, General Counsel and Corporate Secretary
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25
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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26
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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Number of shares
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Weighted-average
|
Number of securities
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||||
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to be issued
|
exercise price of
|
available for issuance
|
||||
Plan category
|
upon exercise
|
outstanding securities
|
under plan
|
||||
Equity compensation plans approved by shareholders
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|
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|
||||
Stock options
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353,087
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$
|
83.94
|
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Restricted stock units
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91,008
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N/A
|
|
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||
Performance stock units
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77,365
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N/A
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|
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||
Deferred stock units
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66,158
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N/A
|
|
|
||
Total securities under approved plans
(a)
|
587,618
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2,978,340
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|
||
Equity compensation plans not approved by shareholders
(b)
:
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|
|
|||||
Deferred stock units
|
22,864
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|
N/A
|
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|
||
Total
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610,482
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|
|
2,978,340
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27
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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(a)
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"Product cost" is presented exclusive of depreciation, depletion and amortization.
|
(b)
|
Depreciation, depletion and amortization include amounts also included in selling, general and administrative expenses.
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(c)
|
In the third quarter of 2014, the Company recognized a gain of $83.3 million ($60.6 million, net of taxes) from an insurance settlement relating to damage it sustained as a result of a tornado that struck its rock salt mine and evaporation plant in Goderich, Ontario, in 2011. The Company recognized $82.3 million of the gain in product cost and $1.0 million of the gain in selling, general and administrative expenses in the consolidated statements of operations. In the fourth quarter of 2013, the Company recognized a gain of $9 million ($5.7 million, net of taxes) from the settlement of an insurance claim resulting from a loss of mineral-concentrated brine due to an asset failure at its solar evaporation ponds in 2010 and a charge of $4.7 million ($2.8 million, net of taxes) from a ruling against the Company related to a labor matter. In 2012 and 2011, our product cost, operating earnings and net earnings were impacted by the effects of a tornado in Goderich, Ontario, that occurred in August 2011.
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(d)
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For the purposes of computing the ratio of earnings to fixed charges, earnings consist of earnings from continuing operations before income taxes and fixed charges. Fixed charges consist of interest expense, including the amortization of deferred debt issuance costs and the interest component of our operating rents.
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28
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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ITEM 7.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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•
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Total sales for 2015 were $1,098.7 million, a decrease of 14% from 2014, largely due to mild winter weather in the fourth quarter of 2015 and the weak agriculture market.
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•
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Net earnings were $159.2 million in 2015, a 27% decrease from 2014. Net earnings in 2014 of $217.9 million were positively impacted by an insurance settlement of $60.6 million (net of tax) related to the tornado that hit our facilities in Goderich, Ontario, in 2011.
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•
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Adjusted earnings before interest, taxes, depreciation and amortization (adjusted "EBITDA") was $299.7 million, a 2% decrease from 2014 adjusted EBITDA of $305.7 million.
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•
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Product cost of 46% of sales in 2015 increased from the product cost of 41% in 2014. The 2014 product cost was favorably impacted due to a gain of approximately $82.3 million from the aforementioned settlement.
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•
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Diluted earnings per share of $4.69 decreased by 27% from 2014 diluted earnings per share.
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•
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Completed the acquisition of a 35% equity stake in Produquímica Industria e Comercio S.A. ("Produquímica"), a leading Brazilian specialty plant nutrition company.
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•
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Salt segment sales were $849.0 million, a decrease of 15% from 2014 primarily due to mild winter weather in the fourth quarter of 2015.
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•
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Salt segment average selling price increased 2% from 2014.
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29
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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•
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Salt segment volumes were down 17% from 2014.
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•
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Our operating results are impacted by the winter weather in the markets we serve. We assess the severity of winter weather compared to recent averages, using official government snow data and comparisons of our sales volumes to historical trends and other relevant data. Our assessment of the frequency of winter events in the three past winter weather seasons in the markets we serve are summarized below
(a)
:
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2013
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Near average in the first quarter
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Above average in the fourth quarter
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2014
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Above average in first quarter
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Below average in the fourth quarter
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2015
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Slightly above average in the first quarter
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Significantly below average in the fourth quarter
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•
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Plant nutrition sales were $238.4 million, a decrease of 12% from 2014, primarily due to weakness in the agriculture market.
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•
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Plant nutrition average selling price increased by 12% from 2014.
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•
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Plant nutrition volumes decreased 21% from 2014 driven by weakness in the agriculture market.
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•
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Per-unit costs have been unfavorably impacted in 2015 by purchased KCl used to supplement the raw mineral feedstock produced through solar-evaporation at our Ogden, Utah, facility.
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30
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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•
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April 2014 - Wolf Trax Inc.
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◦
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We purchased Wolf Trax Inc. (renamed "Compass Manitoba") for approximately $95.5 million Canadian dollars (approximately $86.5 U.S. dollars at closing).
|
◦
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The acquisition enhanced our position as a key resource for premium plant nutrition products based upon proprietary and patented technologies.
|
•
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December 2015 - Produquímica
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◦
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The investment in Produquímica was an all-cash transaction valued at approximately R$452.4 million (approximately $114.1 million U.S. dollars at closing).
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◦
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The investment has been accounted for as an equity method investment in our financial statements.
|
◦
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This is a key step in our plant nutrition growth strategy and provides an attractive entry into Brazil's specialty plant nutrition market.
|
◦
|
We expect that this investment will be accretive in its first year, net of our incremental $100 million debt financing.
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◦
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The agreement also includes a path to full ownership by early 2019 at the latest.
|
•
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Ogden Facility
|
◦
|
Over the past several years, we have made investments to strengthen our solar-pond-based SOP production through upgrades to our processing plant and our solar evaporation ponds. Through these investments, we have been able to increase our annual solar harvest and extraction yield and thereby, our production capacity. Our current production capacity is 320,000 tons per year. We have identified opportunities and have begun to further expand our solar-pond-based SOP production capacity. After the completion of this additional expansion, we expect our SOP production capacity to be approximately 550,000 tons, including tons produced using KCl feedstock.
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•
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Assuming normal winter weather for the remainder of 2016, we expect salt segment sales volumes to surpass 2015 results.
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•
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The plant nutrition outlook continues to be negatively impacted by the overall weakness in the agriculture market, as well as increased imports of SOP driven largely by the current strength of the U.S. dollar.
|
•
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Our 2016 plant nutrition selling prices will be negatively impacted in some geographies as we look to drive SOP sales volumes up to more normal levels.
|
•
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We expect to benefit from improved plant nutrition production costs in the second half of 2016 after we sell through higher-cost KCl inventory from 2015.
|
•
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In February 2016, we announced steps to align our inventories with market demand and we are undergoing a thorough review of our cost structure. This effort is expected to result in a restructuring charge in the first quarter of 2016 of approximately $4 million, or $0.07 per diluted share, related to a workforce reduction of 150 positions. A significant portion of this total results from our investment in continuous mining at its Goderich, Ontario location. We expect the majority of the workforce reduction to be completed by the end of 2016. We expect ongoing annualized savings of approximately $15 million beginning in 2018.
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31
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COMPASS MINERALS INTERNATIONAL, INC.
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2015 FORM 10-K
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Sales
|
|
Year Ended December 31,
|
||||||||||
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|
2015
|
|
2014
|
|
2013
|
||||||
Salt Sales (in millions)
|
|
|
|
|
|
|
||||||
Salt sales
|
|
$
|
849.0
|
|
|
$
|
1,002.6
|
|
|
$
|
920.5
|
|
Less: salt shipping and handling
|
|
239.1
|
|
|
309.3
|
|
|
280.7
|
|
|||
Salt product sales
|
|
$
|
609.9
|
|
|
$
|
693.3
|
|
|
$
|
639.8
|
|
Salt Sales Volumes (thousands of tons)
|
|
|
|
|
|
|
||||||
Highway deicing
|
|
8,854
|
|
|
10,694
|
|
|
10,944
|
|
|||
Consumer and industrial
|
|
2,215
|
|
|
2,596
|
|
|
2,321
|
|
|||
Total tons sold
|
|
11,069
|
|
|
13,290
|
|
|
13,265
|
|
|||
Average Salt Sales Price (per ton)
|
|
|
|
|
|
|
||||||
Highway deicing
|
|
$
|
58.62
|
|
|
$
|
57.37
|
|
|
$
|
53.19
|
|
Consumer and industrial
|
|
148.98
|
|
|
149.89
|
|
|
145.78
|
|
|||
Combined
|
|
76.70
|
|
|
75.44
|
|
|
69.39
|
|
|||
Plant Nutrition Sales (in millions)
|
|
|
|
|
|
|
||||||
Plant nutrition sales
|
|
$
|
238.4
|
|
|
$
|
270.2
|
|
|
$
|
198.6
|
|
Less: plant nutrition shipping and handling
|
|
22.4
|
|
|
28.4
|
|
|
21.0
|
|
|||
Plant nutrition product sales
|
|
$
|
216.0
|
|
|
$
|
241.8
|
|
|
$
|
177.6
|
|
Plant Nutrition Sales Volumes (thousands of tons)
|
|
311
|
|
|
396
|
|
|
315
|
|
|||
Plant Nutrition Average Price (per ton)
|
|
$
|
765
|
|
|
$
|
682
|
|
|
$
|
630
|
|
2015 vs. 2014
|
Salt Product Sales: Decreased 12% or $83.4 million
|
» Salt sales volumes declined 2.2 million tons or 17% due to lower highway and consumer deicing sales volumes as a result of milder winter weather experienced in the fourth quarter of 2015 when compared to the same period in the prior year.
» Lower sales volumes for North American highway and consumer deicing customers contributed approximately $123 million to the decrease in salt product sales.
» The decrease in North American salt volumes was partially offset by higher U.K. sales volumes.
» Unfavorable foreign currency exchange rates contributed approximately $24 million to the decrease in salt product sales.
» An increase of 2% in highway salt deicing average selling prices and lower per-unit shipping and handling costs compared to the prior year partially offset the decline in product sales.
|
|
2014 vs. 2013
|
Salt Product Sales: Increased 8% or $53.5 million
|
» Higher sales volumes for our consumer and industrial products contributed $49 million to the increase in salt product sales.
» Salt sales volumes increased due to higher highway and consumer deicing sales volumes principally due to the more severe winter weather experienced in the first quarter of 2014 in North America when compared to the same period in the prior year.
» The increase in salt volumes was offset by lower U.K. sales volumes due to the mild winter in that region.
» An increase of 8% in salt highway deicing average selling prices, due to higher contract sales in the latter half of 2014, contributed approximately $23 million to the increase in salt product sales.
» The increase in salt product sales was offset by differences in exchange rates used to translate our operations denominated in foreign currencies into U.S. dollars of approximately $13 million and the loss of a supply contract for our consumer and industrial products.
|
|
32
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
2015 vs. 2014
|
Plant Nutrition Product Sales: Decreased 11% or $25.8 million
|
» Plant nutrition sales volumes declined 85,000 tons or 21% and contributed approximately $49 million to the decrease in plant nutrition product sales.
» The 12% increase in plant nutrition average selling price partially offset the decrease in plant nutrition product sales by approximately $23 million.
|
|
2014 vs. 2013
|
Plant Nutrition Product Sales: Increased 36% or $64.2 million
|
» Plant nutrition sales volumes increased 81,000 tons or 26% and contributed approximately $46 million to the increase in plant nutrition product sales.
» The acquisition of our Compass Manitoba business in 2014 contributed to the increase of 8% in our average selling prices when compared to 2013.
|
2015 vs. 2014
|
Gross Profit: Decreased $91.3 million or 22%
Decreased 3 percentage points from 33% to 30% as a percentage of sales
|
» Approximately $83 million of the decrease in gross profit was due to the gain recognized in the salt segment in 2014 from the settlement of the insurance claim related to the tornado in Goderich, Ontario, in 2011.
» Unfavorable exchange rate contributed approximately $7 million to the decrease in salt gross profit.
» Salt gross profit was unfavorably impacted by lower sales volume for highway and consumer and industrial deicing products which were offset partially by higher salt sales realized.
» Lower gross profit for the plant nutrition segment contributed approximately $15 million to the decrease in gross profit primarily due to lower sales volumes.
» Gross profit for the plant nutrition segment was unfavorably impacted by lower plant nutrition sales volumes and an increase in per-unit production costs. Per-unit production costs increased as we purchased and consumed KCl and other mineral feedstock to supplement production due to the poor 2014 evaporation season.
» The decrease in plant nutrition gross profit was partially offset by higher realized average sales prices.
|
2014 vs. 2013
|
Gross Profit: Increased $135.4 million or 47%
Increased 8 percentage points from 25% to 33% as percentage of sales
|
» Gross profit for the salt segment contributed approximately $113 million to the increase in gross profit which included a settlement of $82.3 million for the insurance claim related to the tornado in Goderich, Ontario, in 2011.
» Gross profit for the salt segment was also favorably impacted by higher sales volumes for consumer and industrial products, higher deicing average selling prices and lower per-unit costs in 2014 due to higher production volumes at our North American rock salt mines.
» The increase in salt gross profit was offset partially by the impact of purchased rock salt to supplement our production, higher logistics costs and the impact of exchange rates used to translate our operations denominated in foreign currencies in U.S. dollars in 2014, which unfavorably impacted salt gross profit by $9 million.
» Gross profit for the plant nutrition segment contributed approximately $26 million primarily due to higher sales volumes.
» In addition, the acquisition of our Compass Manitoba business in April 2014 increased plant nutrition gross profit.
» Increases in plant nutrition gross profit were partially offset by higher use of purchased KCl in 2014, which increased per-unit costs and the impact of gain of $9 million recognized in 2013 from the settlement of an insurance claim resulting from a loss of mineral-concentrated brine due to an asset failure at our Ogden facility in 2010.
|
|
33
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
2015 vs. 2014
|
SG&A: Decreased $1.7 million or 2%
Increased to 9.9% from 8.6% as a percentage of sales
|
» The decrease in expense was due to lower professional services expenses in both segments, which totaled approximately $2.8 million in comparison to the prior year.
» SG&A in 2015 was also impacted by lower incentive compensation in both segments and corporate and other, which totaled approximately $2.2 million.
» The decrease was partially offset by an increase in costs in corporate and other related to information technology and ongoing costs related to our Compass Manitoba business in our plant nutrition segment.
|
2014 vs. 2013
|
SG&A: Increased $10.0 million or 10%
Decreased to 8.6% from 8.9% as a percentage of sales
|
» The increase was primarily due to the acquisition and increased ongoing costs associated with the Compass Manitoba business in our plant nutrition segment which totaled $9.5 million.
» SG&A in 2014 was also affected by higher incentive compensation in both segments and corporate and other, which totaled approximately $1.8 million.
» The increases were partially offset by lower corporate salaries due to a reorganization of our management in 2013.
|
2015 vs. 2014
|
Interest Expense: Increased $1.4 million to $21.5 million
|
» The increase was primarily due to the refinancing of our $100.0 million senior notes ("8% Senior Notes") with $250.0 million senior notes ("4.875% Senior Notes") in June 2014.
|
2014 vs. 2013
|
Interest Expense: Increased $2.2 million to $20.1 million
|
» The increase was primarily due to the refinancing of our $100.0 million senior notes with $250.0 million senior notes in June 2014.
|
2015 vs. 2014
|
Other Income, Net: Increased $13.7 million to $14.6 million
|
» Net foreign exchange gains increased from $6.6 million in 2014 to $13.9 million in 2015 and contributed to the year over year improvement.
» The increase was due in part to a $6.9 million charge relating to the refinancing of our senior notes in June 2014.
|
2014 vs. 2013
|
Other Income, Net: Decreased $5.5 million to $0.9 million
|
» The decrease in other income was primarily due to a charge of $6.9 million relating to the refinancing of our senior notes in June 2014.
» Net foreign exchange gains increased from $4.9 million in 2013 to $6.6 million in 2014.
|
|
34
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
2015 vs. 2014
|
*Income Tax Expense: Decreased $18.6 million to $55.3 million
|
» Decrease primarily due to lower pre-tax income.
|
|
2014 vs. 2013
|
*Income Tax Expense: Increased $30.6 million to $73.9 million
|
» Increase primarily due to higher pre-tax income.
|
|
*Our income tax provision in both periods differs from the U.S. statutory rate primarily due to U.S. statutory depletion, domestic manufacturing deductions, state income taxes, foreign income, mining and withholding taxes and interest expense recognition differences for tax and financial reporting purposes. Our effective tax rate was 26% in 2015 and 25% in both 2014 and 2013.
|
•
|
We continue to invest in our Goderich mine to increase our annual available salt production capability to 9.0 million tons as demand warrants.
|
•
|
We have invested in our Ogden facility to strengthen our solar-pond-based SOP production through upgrades to our processing plant and our solar evaporation ponds. The objectives have included modifying our existing solar evaporation ponds to increase the annual solar harvest and increasing the extraction yield and processing capacity of our SOP plant. These improvements have increased our current annual solar-pond-based SOP production capacity to 320,000 tons.
|
•
|
We have identified opportunities and have begun to further expand our solar pond-based SOP production capacity. After the completion of this additional expansion, we expect our SOP production capacity to be approximately 550,000 tons, including tons produced using KCl feedstock.
|
•
|
In 2012, we acquired the mining rights to approximately 100 million tons of salt reserves in the Chilean Atacama Desert. This reserve estimate is based upon an initial report. We will need to complete a feasibility study before we proceed with the development of this project to ensure our salt reserves are probable. The development of this project will require significant infrastructure to establish extraction and logistics capabilities. In the event that production begins, we will be required to pay the seller royalties on any tons produced. In 2015, prepaid royalty payments began and will be required until production activities begin.
|
•
|
In 2014, we completed the acquisition of Wolf Trax, Inc., a privately-held Canadian corporation (renamed "Compass Manitoba"). The acquisition enhanced our position as a key resource for premium plant nutrition products by adding innovative crop nutrient products based upon proprietary and patented technologies.
|
•
|
In December 2015, we completed the acquisition of a 35% equity stake in Produquímica, one of Brazil’s leading manufacturers and distributors of specialty plant nutrients. The all-cash transaction was valued at R$452.4 million (approximately $114.1 million U.S. dollars at closing), subject to customary post-closing adjustments. We acquired 6% of the common shares at closing and have approximately 29% of preferred shares that will be converted to common shares upon the settlement of certain post-closing adjustments, including possible additional consideration. The additional consideration will be based upon 2015 adjusted EBITDA, as defined in the agreements. Terms of the investment provide an opportunity for the Company to acquire the remainder of Produquímica by early 2019 at the latest.
|
|
35
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
36
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
2015
|
2014
|
2013
|
Operating Activities:
|
||
» Working capital items were a use of operating cash flows of $108.5 million in 2015 compared to a source of operating cash flows of $4.5 million in the prior year.
» This working capital use of $108.5 million is primarily related to the mild winter weather in the fourth quarter of 2015 and a weak agriculture market.
|
» Net earnings increased $87.1 million from the prior year.
» This included a non-cash gain of $60.6 million (net of tax) related to the tornado insurance settlement which reduced our cash flows from operations.
» Working capital items were a source of operating cash flows of $4.5 million in 2014 compared to a source of $20.4 million in the prior year.
|
» Net earnings increased $41.9 million from the prior year.
» Working capital items were a source of operating cash flows of $20.4 million in 2013 compared to a use of operating cash flows of $36.8 million in the prior year.
|
Investing Activities:
|
||
» Net cash flows used by investing activities included $217.6 million of capital expenditures and an equity investment of $116.4 million.
|
» Net cash flows used by investing activities included $125.2 million of capital expenditures, partially offset by tornado insurance proceeds.
» We also acquired Wolf Trax, Inc. for $86.5 million in 2014.
|
» Net cash flows used by investing activities included $122.7 million of capital expenditures, partially offset by insurance advances related to the Goderich tornado.
» Capital expenditures included $15.0 million for replacement of property, plant and equipment damaged or destroyed by the tornado.
|
Financing Activities:
|
||
» The source of financing cash flows was primarily related to the new debt obtained to finance the investment in Produquímica of $100 million, partially offset by the payment of dividends of $89.4 million.
|
» The source of financing cash flows included the refinancing of our Senior Notes and proceeds received from stock option exercises of $7.5 million, partially offset by the payment of dividends of $80.7 million and debt payments of $3.9 million.
|
» Net cash flows used by financing activities included $73.1 million in dividend payments and $3.9 million of debt, partially offset by proceeds from stock option exercises of $10.6 million.
|
|
37
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
38
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
Contractual Cash Obligations
|
|
Total
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
||||||||||||||
Long-term Debt
|
|
$
|
727.0
|
|
|
$
|
4.9
|
|
|
$
|
472.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
250.0
|
|
Interest
(a)
|
|
118.1
|
|
|
22.4
|
|
|
16.0
|
|
|
12.2
|
|
|
12.2
|
|
|
12.2
|
|
|
43.1
|
|
|||||||
Operating Leases
(b)
|
|
40.0
|
|
|
15.7
|
|
|
9.7
|
|
|
4.1
|
|
|
3.6
|
|
|
1.9
|
|
|
5.0
|
|
|||||||
Unconditional Purchase Obligations
(c)
|
|
190.6
|
|
|
57.6
|
|
|
35.0
|
|
|
33.0
|
|
|
32.5
|
|
|
32.5
|
|
|
—
|
|
|||||||
Estimated Future Pension Benefit Obligations
(d)
|
|
66.9
|
|
|
2.8
|
|
|
2.9
|
|
|
3.0
|
|
|
3.1
|
|
|
3.3
|
|
|
51.8
|
|
|||||||
Total Contractual Cash Obligations
|
|
$
|
1,142.6
|
|
|
$
|
103.4
|
|
|
$
|
535.7
|
|
|
$
|
52.3
|
|
|
$
|
51.4
|
|
|
$
|
49.9
|
|
|
$
|
349.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Other Commitments
|
|
Total
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
||||||||||||||
Letters of Credit
|
|
$
|
5.6
|
|
|
$
|
5.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bank Letter Guarantees
(e)
|
|
44.1
|
|
|
44.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Performance Bonds
(e)
|
|
106.7
|
|
|
101.4
|
|
|
5.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total Other Commitments
|
|
$
|
156.4
|
|
|
$
|
151.1
|
|
|
$
|
5.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(a)
|
Based on maintaining existing debt balances to maturity. Interest on the Credit Agreement varies with the Eurodollar rate. The December 31, 2015, blended rate of 3.1%, including the applicable spread, was used for this calculation. The amounts in the table do not include interest payments of approximately $1 million in 2016 and approximately $4 million each year thereafter which may be required to be deposited with the taxing authorities if other collateral arrangements cannot be made as long as the dispute remains outstanding. Note 8 to Consolidated Financial Statements provides additional information related to our Canadian tax reassessments.
|
(b)
|
We lease property and equipment under non-cancelable operating leases for varying periods.
|
(c)
|
We have long-term contracts to purchase certain amounts of electricity and a minimum tonnage of salt and KCl under purchase contracts. The price of the salt is dependent on the product purchased and has been estimated based on an average of the prices in effect for the various products at December 31, 2015, and adjusted based upon estimated price increases for 2016. The price of KCl is based upon contract rates. In addition, we have minimum throughput commitments in certain depots.
|
(d)
|
Note 9 to our Consolidated Financial Statements provides additional information.
|
(e)
|
Note 12 to our Consolidated Financial Statements provides additional information.
|
|
39
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2015
|
|
2014
|
|
2013
|
||||||
Net earnings
|
|
$
|
159.2
|
|
|
$
|
217.9
|
|
|
$
|
130.8
|
|
Interest expense
|
|
21.5
|
|
|
20.1
|
|
|
17.9
|
|
|||
Income tax expense
|
|
55.3
|
|
|
73.9
|
|
|
43.3
|
|
|||
Depreciation, depletion and amortization
|
|
78.3
|
|
|
78.0
|
|
|
73.0
|
|
|||
EBITDA
|
|
$
|
314.3
|
|
|
$
|
389.9
|
|
|
$
|
265.0
|
|
Adjustments to EBITDA:
|
|
|
|
|
|
|
|
|
|
|||
Gain from insurance settlement
|
|
$
|
—
|
|
|
$
|
(83.3
|
)
|
|
$
|
(9.0
|
)
|
Estimated costs of a legal ruling
|
|
—
|
|
|
—
|
|
|
4.7
|
|
|||
Fees and premiums paid to redeem debt
|
|
—
|
|
|
4.0
|
|
|
—
|
|
|||
Write-off of unamortized deferred financing fees and original issue discount
|
|
—
|
|
|
2.9
|
|
|
—
|
|
|||
Other income, net
|
|
(14.6
|
)
|
|
(7.8
|
)
|
|
(6.4
|
)
|
|||
Adjusted EBITDA
|
|
$
|
299.7
|
|
|
$
|
305.7
|
|
|
$
|
254.3
|
|
|
40
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
41
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
42
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
43
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
Description
|
Page
|
|
|
Reports of Independent Registered Public Accounting Firm
|
45
|
|
|
Consolidated Balance Sheets as of December 31, 2015 and 2014
|
47
|
|
|
Consolidated Statements of Operations for each of the three years in the period ended December 31, 2015
|
48
|
|
|
Consolidated Statements of Comprehensive Income for each of the three years in the period ended December 31, 2015
|
49
|
|
|
Consolidated Statements of Stockholders’ Equity for each of the three years in the period ended December 31, 2015
|
50
|
|
|
Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2015
|
51
|
|
|
Notes to Consolidated Financial Statements
|
52
|
|
44
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
Kansas City, Missouri
|
/s/ Ernst & Young LLP
|
February 22, 2016
|
|
|
45
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
Kansas City, Missouri
|
/s/ Ernst & Young LLP
|
February 22, 2016
|
|
|
46
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
|
December 31,
|
||||||
(In millions, except share data)
|
|
2015
|
|
2014
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
58.4
|
|
|
$
|
266.8
|
|
Receivables, less allowance for doubtful accounts of $1.3 in 2015 and $1.4 in 2014
|
|
147.8
|
|
|
213.0
|
|
||
Inventories
|
|
275.3
|
|
|
199.0
|
|
||
Deferred income taxes, net
|
|
—
|
|
|
9.7
|
|
||
Other
|
|
30.8
|
|
|
14.2
|
|
||
Total current assets
|
|
512.3
|
|
|
702.7
|
|
||
Property, plant and equipment, net
|
|
800.7
|
|
|
700.9
|
|
||
Intangible assets, net
|
|
85.3
|
|
|
106.2
|
|
||
Goodwill
|
|
58.1
|
|
|
68.5
|
|
||
Investment in equity investee
|
|
116.4
|
|
|
—
|
|
||
Other
|
|
56.1
|
|
|
58.9
|
|
||
Total assets
|
|
$
|
1,628.9
|
|
|
$
|
1,637.2
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
|
||
Current portion of long-term debt
|
|
$
|
4.9
|
|
|
$
|
3.9
|
|
Accounts payable
|
|
80.7
|
|
|
97.6
|
|
||
Accrued expenses
|
|
48.9
|
|
|
60.6
|
|
||
Accrued salaries and wages
|
|
15.2
|
|
|
24.4
|
|
||
Income taxes payable
|
|
14.8
|
|
|
44.4
|
|
||
Accrued interest
|
|
6.3
|
|
|
6.8
|
|
||
Total current liabilities
|
|
170.8
|
|
|
237.7
|
|
||
Long-term debt, net of current portion
|
|
722.1
|
|
|
622.5
|
|
||
Deferred income taxes, net
|
|
71.3
|
|
|
88.9
|
|
||
Other noncurrent liabilities
|
|
25.0
|
|
|
34.5
|
|
||
Commitments and contingencies (Note 12)
|
|
|
|
|
|
|
||
Stockholders' equity:
|
|
|
|
|
|
|
||
Common Stock:
|
|
|
|
|
|
|
||
$0.01 par value, authorized shares – 200,000,000; issued shares – 35,367,264
|
|
0.4
|
|
|
0.4
|
|
||
Additional paid-in capital
|
|
91.7
|
|
|
82.5
|
|
||
Treasury stock, at cost – 1,665,731 shares at December 31, 2015 and 1,757,997 shares at December 31, 2014
|
|
(3.2
|
)
|
|
(3.3
|
)
|
||
Retained earnings
|
|
659.1
|
|
|
589.5
|
|
||
Accumulated other comprehensive loss
|
|
(108.3
|
)
|
|
(15.5
|
)
|
||
Total stockholders' equity
|
|
639.7
|
|
|
653.6
|
|
||
Total liabilities and stockholders' equity
|
|
$
|
1,628.9
|
|
|
$
|
1,637.2
|
|
|
|
|
|
|
|
47
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
|
For the Year Ended December 31,
|
||||||||||
(In millions, except share data)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Sales
|
|
$
|
1,098.7
|
|
|
$
|
1,282.5
|
|
|
$
|
1,129.6
|
|
Shipping and handling cost
|
|
261.5
|
|
|
337.7
|
|
|
301.7
|
|
|||
Product cost (Note 4)
|
|
507.1
|
|
|
523.4
|
|
|
541.9
|
|
|||
Gross profit
|
|
330.1
|
|
|
421.4
|
|
|
286.0
|
|
|||
Selling, general and administrative expenses
|
|
108.7
|
|
|
110.4
|
|
|
100.4
|
|
|||
Operating earnings
|
|
221.4
|
|
|
311.0
|
|
|
185.6
|
|
|||
Other (income) expense:
|
|
|
|
|
|
|
|
|
|
|||
Interest expense
|
|
21.5
|
|
|
20.1
|
|
|
17.9
|
|
|||
Other, net
|
|
(14.6
|
)
|
|
(0.9
|
)
|
|
(6.4
|
)
|
|||
Earnings before income taxes
|
|
214.5
|
|
|
291.8
|
|
|
174.1
|
|
|||
Income tax expense
|
|
55.3
|
|
|
73.9
|
|
|
43.3
|
|
|||
Net earnings
|
|
$
|
159.2
|
|
|
$
|
217.9
|
|
|
$
|
130.8
|
|
Basic net earnings per common share
|
|
$
|
4.70
|
|
|
$
|
6.45
|
|
|
$
|
3.89
|
|
Diluted net earnings per common share
|
|
$
|
4.69
|
|
|
$
|
6.44
|
|
|
$
|
3.88
|
|
Weighted-average common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
33,677
|
|
|
33,557
|
|
|
33,403
|
|
|||
Diluted
|
|
33,692
|
|
|
33,581
|
|
|
33,420
|
|
|||
Cash dividends per share
|
|
$
|
2.64
|
|
|
$
|
2.40
|
|
|
$
|
2.18
|
|
|
48
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
|
For the Year Ended December 31,
|
||||||||||
(In millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Net earnings
|
|
$
|
159.2
|
|
|
$
|
217.9
|
|
|
$
|
130.8
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|||
Unrealized gain (loss) from change in pension costs, net of tax of $(1.2), $(0.1) and $(0.2) in 2015, 2014 and 2013
|
|
5.2
|
|
|
0.3
|
|
|
0.3
|
|
|||
Unrealized gain (loss) on cash flow hedges, net of tax of $(0.3), $1.4 and $(0.6) in 2015, 2014 and 2013
|
|
0.4
|
|
|
(2.3
|
)
|
|
1.0
|
|
|||
Cumulative translation adjustment
|
|
(98.4
|
)
|
|
(48.0
|
)
|
|
(24.4
|
)
|
|||
Comprehensive income
|
|
$
|
66.4
|
|
|
$
|
167.9
|
|
|
$
|
107.7
|
|
|
49
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
(In millions)
|
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Treasury
Stock
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
|
||||||||||||
Balance, December 31, 2012
|
|
$
|
0.4
|
|
|
$
|
54.5
|
|
|
$
|
(4.0
|
)
|
|
$
|
395.0
|
|
|
$
|
57.6
|
|
|
$
|
503.5
|
|
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
130.8
|
|
|
(23.1
|
)
|
|
107.7
|
|
||||||
Dividends on common stock/equity awards
|
|
|
|
|
|
|
|
|
|
|
(73.3
|
)
|
|
|
|
|
(73.3
|
)
|
||||||
Shares issued for stock units
|
|
|
|
|
(0.1
|
)
|
|
0.1
|
|
|
|
|
|
|
|
|
—
|
|
||||||
Income tax benefits from equity awards
|
|
|
|
|
0.6
|
|
|
|
|
|
|
|
|
|
|
|
0.6
|
|
||||||
Stock options exercised
|
|
|
|
|
10.3
|
|
|
0.3
|
|
|
|
|
|
|
|
|
10.6
|
|
||||||
Stock-based compensation
|
|
|
|
|
5.1
|
|
|
|
|
|
|
|
|
|
|
|
5.1
|
|
||||||
Balance, December 31, 2013
|
|
$
|
0.4
|
|
|
$
|
70.4
|
|
|
$
|
(3.6
|
)
|
|
$
|
452.5
|
|
|
$
|
34.5
|
|
|
$
|
554.2
|
|
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
217.9
|
|
|
(50.0
|
)
|
|
167.9
|
|
||||||
Dividends on common stock/equity awards
|
|
|
|
|
0.2
|
|
|
|
|
|
(80.9
|
)
|
|
|
|
|
(80.7
|
)
|
||||||
Shares issued for stock units
|
|
|
|
|
(0.1
|
)
|
|
0.1
|
|
|
|
|
|
|
|
|
—
|
|
||||||
Income tax deficiencies from equity awards
|
|
|
|
|
(0.2
|
)
|
|
|
|
|
|
|
|
|
|
|
(0.2
|
)
|
||||||
Stock options exercised
|
|
|
|
|
7.3
|
|
|
0.2
|
|
|
|
|
|
|
|
|
7.5
|
|
||||||
Stock-based compensation
|
|
|
|
|
4.9
|
|
|
|
|
|
|
|
|
|
|
|
4.9
|
|
||||||
Balance, December 31, 2014
|
|
$
|
0.4
|
|
|
$
|
82.5
|
|
|
$
|
(3.3
|
)
|
|
$
|
589.5
|
|
|
$
|
(15.5
|
)
|
|
$
|
653.6
|
|
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
159.2
|
|
|
(92.8
|
)
|
|
66.4
|
|
||||||
Dividends on common stock/equity awards
|
|
|
|
|
0.2
|
|
|
|
|
|
(89.6
|
)
|
|
|
|
|
(89.4
|
)
|
||||||
Income tax benefits from equity awards
|
|
|
|
|
0.5
|
|
|
|
|
|
|
|
|
|
|
|
0.5
|
|
||||||
Stock options exercised
|
|
|
|
|
2.4
|
|
|
0.1
|
|
|
|
|
|
|
|
|
2.5
|
|
||||||
Stock-based compensation
|
|
|
|
|
6.1
|
|
|
|
|
|
|
|
|
|
|
|
6.1
|
|
||||||
Balance, December 31, 2015
|
|
$
|
0.4
|
|
|
$
|
91.7
|
|
|
$
|
(3.2
|
)
|
|
$
|
659.1
|
|
|
$
|
(108.3
|
)
|
|
$
|
639.7
|
|
|
50
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
|
For the Year Ended December 31,
|
||||||||||
(In millions)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net earnings
|
|
$
|
159.2
|
|
|
$
|
217.9
|
|
|
$
|
130.8
|
|
Adjustments to reconcile net earnings to net cash flows provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation, depletion and amortization
|
|
78.3
|
|
|
78.0
|
|
|
73.0
|
|
|||
Finance fee amortization
|
|
1.2
|
|
|
1.2
|
|
|
1.2
|
|
|||
Early extinguishment and refinancing of long-term debt
|
|
—
|
|
|
6.9
|
|
|
—
|
|
|||
Stock-based compensation
|
|
6.1
|
|
|
4.9
|
|
|
5.1
|
|
|||
Deferred income taxes
|
|
(0.1
|
)
|
|
3.6
|
|
|
(0.2
|
)
|
|||
Gain from insurance settlement
|
|
—
|
|
|
(83.3
|
)
|
|
—
|
|
|||
Other, net
|
|
4.2
|
|
|
0.8
|
|
|
1.7
|
|
|||
Asset impairment charges, Goderich tornado
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|||
Insurance receipts for operating purposes, Goderich tornado
|
|
—
|
|
|
11.9
|
|
|
5.5
|
|
|||
Changes in operating assets and liabilities, net of acquisition:
|
|
|
|
|
|
|
|
|
|
|||
Receivables
|
|
59.0
|
|
|
(4.4
|
)
|
|
(71.7
|
)
|
|||
Inventories
|
|
(90.5
|
)
|
|
(21.9
|
)
|
|
45.7
|
|
|||
Other assets
|
|
(11.3
|
)
|
|
(4.7
|
)
|
|
1.3
|
|
|||
Accounts payable, income taxes payable and accrued expenses
|
|
(65.7
|
)
|
|
35.5
|
|
|
45.1
|
|
|||
Other liabilities
|
|
(2.5
|
)
|
|
(3.5
|
)
|
|
0.6
|
|
|||
Net cash provided by operating activities
|
|
137.9
|
|
|
242.9
|
|
|
238.3
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
|
(217.6
|
)
|
|
(125.2
|
)
|
|
(122.7
|
)
|
|||
Investment in equity method investee
|
|
(116.4
|
)
|
|
—
|
|
|
—
|
|
|||
Insurance receipts for investment purposes, Goderich tornado
|
|
—
|
|
|
19.4
|
|
|
14.2
|
|
|||
Acquisition of a business
|
|
—
|
|
|
(86.5
|
)
|
|
—
|
|
|||
Other, net
|
|
(1.4
|
)
|
|
3.1
|
|
|
2.4
|
|
|||
Net cash used in investing activities
|
|
(335.4
|
)
|
|
(189.2
|
)
|
|
(106.1
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Proceeds from the issuance of long-term debt
|
|
100.0
|
|
|
250.0
|
|
|
—
|
|
|||
Proceeds from revolving credit facility borrowings
|
|
50.0
|
|
|
—
|
|
|
—
|
|
|||
Principal payments on long-term debt
|
|
(3.9
|
)
|
|
(102.4
|
)
|
|
(3.9
|
)
|
|||
Principal payments on revolving credit facility borrowings
|
|
(45.5
|
)
|
|
—
|
|
|
—
|
|
|||
Premium and other payments to refinance debt
|
|
—
|
|
|
(5.5
|
)
|
|
—
|
|
|||
Deferred financing costs
|
|
—
|
|
|
(4.1
|
)
|
|
(0.6
|
)
|
|||
Dividends paid
|
|
(89.4
|
)
|
|
(80.7
|
)
|
|
(73.1
|
)
|
|||
Proceeds received from stock option exercises
|
|
2.5
|
|
|
7.5
|
|
|
10.6
|
|
|||
Excess tax benefits (deficiencies) from equity compensation awards
|
|
0.5
|
|
|
(0.2
|
)
|
|
0.6
|
|
|||
Net cash provided by (used in) financing activities
|
|
14.2
|
|
|
64.6
|
|
|
(66.4
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
(25.1
|
)
|
|
(11.1
|
)
|
|
(6.3
|
)
|
|||
Net change in cash and cash equivalents
|
|
(208.4
|
)
|
|
107.2
|
|
|
59.5
|
|
|||
Cash and cash equivalents, beginning of the year
|
|
266.8
|
|
|
159.6
|
|
|
100.1
|
|
|||
Cash and cash equivalents, end of year
|
|
$
|
58.4
|
|
|
$
|
266.8
|
|
|
$
|
159.6
|
|
Supplemental cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Interest paid, net of amounts capitalized
|
|
$
|
20.5
|
|
|
$
|
13.1
|
|
|
$
|
17.4
|
|
Income taxes paid, net of refunds
|
|
$
|
89.4
|
|
|
$
|
36.2
|
|
|
$
|
24.7
|
|
In connection with the acquisition of Wolf Trax, Inc., the Company assumed liabilities as follows (in millions):
|
||||||||||||
Fair value of assets acquired
|
|
|
|
|
$
|
99.2
|
|
|
|
|
||
Cash paid during the year ended December 31, 2014
|
|
|
|
|
(86.5
|
)
|
|
|
|
|||
Liabilities assumed
|
|
|
|
|
$
|
12.7
|
|
|
|
|
|
51
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
|
52
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
53
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
54
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
55
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
56
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
|
|
2015
|
|
2014
|
||||
Finished goods
|
|
$
|
223.1
|
|
|
$
|
148.5
|
|
Raw materials and supplies
|
|
52.2
|
|
|
50.5
|
|
||
Total inventories
|
|
$
|
275.3
|
|
|
$
|
199.0
|
|
|
|
|
2015
|
|
2014
|
||||
Land, buildings and structures and leasehold improvements
|
|
$
|
347.3
|
|
|
$
|
352.2
|
|
Machinery and equipment
|
|
701.5
|
|
|
669.1
|
|
||
Office furniture and equipment
|
|
25.4
|
|
|
17.5
|
|
||
Mineral interests
|
|
169.6
|
|
|
179.6
|
|
||
Construction in progress
|
|
191.5
|
|
|
108.9
|
|
||
|
|
1,435.3
|
|
|
1,327.3
|
|
||
Less accumulated depreciation and depletion
|
|
(634.6
|
)
|
|
(626.4
|
)
|
||
Property, plant and equipment, net
|
|
$
|
800.7
|
|
|
$
|
700.9
|
|
|
|
|
Supply
Agreement
|
|
SOP
Production
Rights
|
|
Customer/
Distributor
Relationships
|
|
Lease
Rights
|
|
Patents
|
|
Other
|
|
Total
|
||||||||||||||
December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross intangible asset
|
|
$
|
26.1
|
|
|
$
|
24.3
|
|
|
$
|
7.0
|
|
|
$
|
1.6
|
|
|
$
|
14.9
|
|
|
$
|
3.9
|
|
|
$
|
77.8
|
|
Accumulated amortization
|
|
(2.6
|
)
|
|
(11.7
|
)
|
|
(2.5
|
)
|
|
(0.2
|
)
|
|
(2.3
|
)
|
|
(1.2
|
)
|
|
(20.5
|
)
|
|||||||
Net intangible assets
|
|
$
|
23.5
|
|
|
$
|
12.6
|
|
|
$
|
4.5
|
|
|
$
|
1.4
|
|
|
$
|
12.6
|
|
|
$
|
2.7
|
|
|
$
|
57.3
|
|
|
57
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
Supply Agreement
|
|
SOP
Production
Rights
|
|
Customer Relationships
|
|
Lease Rights
|
|
Patents
|
|
Other
|
|
Total
|
||||||||||||||
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross intangible asset
|
|
$
|
31.3
|
|
|
$
|
24.3
|
|
|
$
|
8.1
|
|
|
$
|
1.9
|
|
|
$
|
17.9
|
|
|
$
|
4.6
|
|
|
$
|
88.1
|
|
Accumulated amortization
|
|
(2.5
|
)
|
|
(10.8
|
)
|
|
(2.0
|
)
|
|
(0.2
|
)
|
|
(1.2
|
)
|
|
(0.6
|
)
|
|
(17.3
|
)
|
|||||||
Net intangible assets
|
|
$
|
28.8
|
|
|
$
|
13.5
|
|
|
$
|
6.1
|
|
|
$
|
1.7
|
|
|
$
|
16.7
|
|
|
$
|
4.0
|
|
|
$
|
70.8
|
|
Intangible asset
|
Estimated
Lives
|
Supply agreement
|
50 years
|
SOP production rights
|
25 years
|
Patents
|
10-20 years
|
Developed technology
|
5 years
|
Lease rights
|
25 years
|
Customer and distributor relationships
|
10 years
|
Trademarks
|
10 years
|
Noncompete agreements
|
5 years
|
Trade names
|
Indefinite
|
Water rights
|
Indefinite
|
|
|
58
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
31.7
|
|
|
$
|
37.4
|
|
|
$
|
23.2
|
|
State
|
|
7.3
|
|
|
9.5
|
|
|
5.7
|
|
|||
Foreign
|
|
16.4
|
|
|
23.4
|
|
|
14.6
|
|
|||
Total current
|
|
55.4
|
|
|
70.3
|
|
|
43.5
|
|
|||
Deferred:
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
(0.2
|
)
|
|
(3.6
|
)
|
|
(2.5
|
)
|
|||
State
|
|
—
|
|
|
(0.9
|
)
|
|
(0.6
|
)
|
|||
Foreign
|
|
0.1
|
|
|
8.1
|
|
|
2.9
|
|
|||
Total deferred
|
|
(0.1
|
)
|
|
3.6
|
|
|
(0.2
|
)
|
|||
Total provision for income taxes
|
|
$
|
55.3
|
|
|
$
|
73.9
|
|
|
$
|
43.3
|
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Domestic income
|
|
$
|
170.6
|
|
|
$
|
184.3
|
|
|
$
|
112.3
|
|
Foreign income
|
|
43.9
|
|
|
107.5
|
|
|
61.8
|
|
|||
Earnings before income taxes
|
|
214.5
|
|
|
291.8
|
|
|
174.1
|
|
|||
Computed tax at the U.S. federal statutory rate of 35%
|
|
75.1
|
|
|
102.1
|
|
|
60.9
|
|
|||
Foreign income rate differential, mining, and withholding taxes, net of U.S. federal deduction
|
|
(1.2
|
)
|
|
(9.3
|
)
|
|
(2.6
|
)
|
|||
Percentage depletion in excess of basis
|
|
(11.2
|
)
|
|
(11.8
|
)
|
|
(9.0
|
)
|
|||
Other domestic tax reserves, net of reversals
|
|
(4.5
|
)
|
|
(3.9
|
)
|
|
(0.9
|
)
|
|||
Domestic manufacturers deduction
|
|
(2.4
|
)
|
|
(2.5
|
)
|
|
(1.3
|
)
|
|||
State income taxes, net of federal income tax benefit
|
|
5.1
|
|
|
5.5
|
|
|
3.4
|
|
|||
Interest expense recognition differences
|
|
(6.1
|
)
|
|
(7.1
|
)
|
|
(7.0
|
)
|
|||
Other, net
|
|
0.5
|
|
|
0.9
|
|
|
(0.2
|
)
|
|||
Provision for income taxes
|
|
$
|
55.3
|
|
|
$
|
73.9
|
|
|
$
|
43.3
|
|
Effective tax rate
|
|
26
|
%
|
|
25
|
%
|
|
25
|
%
|
|
59
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
2015
|
|
2014
|
||||
Current deferred tax assets
(a)
:
|
|
|
|
|
||||
Accrued expenses
|
|
$
|
—
|
|
|
$
|
3.5
|
|
Other, net
|
|
—
|
|
|
6.2
|
|
||
Current deferred tax assets
|
|
—
|
|
|
9.7
|
|
||
Current deferred tax liabilities
(a)
:
|
|
|
|
|
|
|
||
Other, net
|
|
—
|
|
|
0.4
|
|
||
Current deferred tax liabilities
|
|
—
|
|
|
0.4
|
|
||
Noncurrent deferred taxes:
|
|
|
|
|
|
|
||
Property, plant and equipment
|
|
73.0
|
|
|
77.6
|
|
||
Intangible asset
|
|
13.9
|
|
|
17.7
|
|
||
Other, net
|
|
3.3
|
|
|
2.7
|
|
||
Total noncurrent deferred tax liabilities
|
|
90.2
|
|
|
98.0
|
|
||
Deferred tax assets:
|
|
|
|
|
|
|
||
Net operating loss carryforwards
|
|
2.6
|
|
|
0.8
|
|
||
Stock-based compensation
|
|
4.7
|
|
|
3.7
|
|
||
Other, net
|
|
12.5
|
|
|
5.6
|
|
||
Subtotal
|
|
19.8
|
|
|
10.1
|
|
||
Valuation allowance
|
|
(0.9
|
)
|
|
(1.0
|
)
|
||
Total noncurrent deferred tax assets
|
|
18.9
|
|
|
9.1
|
|
||
Net noncurrent deferred tax liabilities
|
|
$
|
71.3
|
|
|
$
|
88.9
|
|
(a)
|
The Company elected to prospectively adopt guidance from the FASB which requires deferred tax assets and liabilities to be presented as noncurrent in its consolidated balance sheets. This guidance was elected prospectively and the prior period was not retrospectively adjusted (see Recent Accounting Pronouncements in Note 2).
|
|
60
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Unrecognized tax benefits:
|
|
|
|
|
|
|
||||||
Balance at January 1
|
|
$
|
21.8
|
|
|
$
|
24.6
|
|
|
$
|
25.3
|
|
Additions resulting from current year tax positions
|
|
1.6
|
|
|
1.0
|
|
|
1.0
|
|
|||
Additions relating to tax positions taken in prior years
|
|
0.8
|
|
|
1.1
|
|
|
—
|
|
|||
Reductions due to cash payments
|
|
(0.8
|
)
|
|
(0.3
|
)
|
|
(0.8
|
)
|
|||
Reductions relating to tax positions taken in prior years
|
|
(2.4
|
)
|
|
(1.2
|
)
|
|
(0.9
|
)
|
|||
Reductions due to expiration of tax years
|
|
(2.7
|
)
|
|
(3.4
|
)
|
|
—
|
|
|||
Balance at December 31
|
|
$
|
18.3
|
|
|
$
|
21.8
|
|
|
$
|
24.6
|
|
|
61
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
|
Plan Assets at December 31,
|
||||
Asset Category
|
|
2015
|
|
2014
|
||
Cash and cash equivalents
|
|
1
|
%
|
|
1
|
%
|
Equity funds
|
|
—
|
%
|
|
53
|
%
|
Blended funds
|
|
32
|
%
|
|
—
|
%
|
Bond funds
|
|
45
|
%
|
|
46
|
%
|
Insurance policy
|
|
22
|
%
|
|
—
|
%
|
Total
|
|
100
|
%
|
|
100
|
%
|
|
|
Market Value at
December 31,
2015
|
|
Level One
|
|
Level Two
|
|
Level Three
|
||||||||
Asset category:
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
(a)
|
|
$
|
0.9
|
|
|
$
|
0.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Equity funds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Blended funds
(b)
|
|
21.1
|
|
|
—
|
|
|
21.1
|
|
|
—
|
|
||||
Bond funds
(c)
:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Treasuries
|
|
30.3
|
|
|
—
|
|
|
30.3
|
|
|
—
|
|
||||
Insurance policy
(d)
|
|
14.6
|
|
|
—
|
|
|
—
|
|
|
14.6
|
|
||||
Total Pension Assets
|
|
$
|
66.9
|
|
|
$
|
0.9
|
|
|
$
|
51.4
|
|
|
$
|
14.6
|
|
(a)
|
The fair value of cash and cash equivalents is its carrying value.
|
(b)
|
The Company is invested in a diversified growth fund. The diversified growth fund is valued at the last traded or official close for the underlying equities and bid or mid for the underlying fixed income securities depending on the portfolio benchmark. Where representative prices are unavailable, underlying fixed income investments are valued based on other observable market-based inputs.
|
(c)
|
This category includes investments in investment-grade fixed-income instruments and funds linked to U.K. treasury notes. The funds are valued using the bid amounts for each fund. All of the Company’s bond fund pension assets are invested in U.K.-linked treasuries as of
December 31, 2015
.
|
(d)
|
The insurance policy has been written by an insurance company with an A+ rating from Standard and Poors. The policy derives its value primarily from its underlying investments which consists of separate funds also managed by the underwriter. The policy’s holdings consist primarily of a unit trust fund, which is valued based on its underlying holdings of equities, fixed income securities, cash, and derivative instruments. Those underlying investments are valued at bid price on the last business day of the period when available. Other investments use the last available authorized price of the last business day of the period. Unquoted investments are valued based upon the fund manager’s opinion of fair value based primarily on other observable market-based inputs. Open positions in derivative contracts or foreign currency transactions are included at their mark to market value. Money market instruments are valued based upon amortized cost. Term deposits are valued at their nominal value.
|
|
62
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
Market Value at
December 31,
2014
|
|
Level One
|
|
Level Two
|
|
Level Three
|
||||||||
Asset category:
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
(a)
|
|
$
|
1.0
|
|
|
$
|
1.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Equity funds
|
|
37.0
|
|
|
—
|
|
|
37.0
|
|
|
—
|
|
||||
Bond funds
(b)
:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Treasuries
|
|
32.3
|
|
|
—
|
|
|
32.3
|
|
|
—
|
|
||||
Total Pension Assets
|
|
$
|
70.3
|
|
|
$
|
1.0
|
|
|
$
|
69.3
|
|
|
$
|
—
|
|
(a)
|
The fair value of cash and cash equivalents is its carrying value.
|
(b)
|
This category includes investments in investment-grade fixed-income instruments and funds linked to U.K. treasury notes. The funds are valued using the bid amounts for each fund. All of the Company’s bond fund pension assets are invested in U.K.-linked treasuries as of
December 31, 2014
.
|
Year Ended December 31, 2015
|
|
Value of Insurance Policy
|
||
Beginning balance as of January 1, 2015
|
|
$
|
—
|
|
Purchase
|
|
15.4
|
|
|
Unrealized loss
|
|
(0.1
|
)
|
|
Currency fluctuation adjustment
|
|
(0.7
|
)
|
|
Ending balance as of December 31, 2015
|
|
$
|
14.6
|
|
|
|
2015
|
|
2014
|
|
2013
|
|||
Discount rate
|
|
3.40
|
%
|
|
4.40
|
%
|
|
4.40
|
%
|
Expected return on plan assets
|
|
4.30
|
%
|
|
5.30
|
%
|
|
4.60
|
%
|
|
63
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
Calendar Year
|
Future Expected
Benefit Payments
|
||
2016
|
$
|
2.8
|
|
2017
|
2.9
|
|
|
2018
|
3.0
|
|
|
2019
|
3.1
|
|
|
2020
|
3.2
|
|
|
2021 – 2025
|
17.4
|
|
|
|
2015
|
|
2014
|
||||
Change in benefit obligation:
|
|
|
|
|
||||
Benefit obligation as of January 1
|
|
$
|
76.8
|
|
|
$
|
73.6
|
|
Interest cost
|
|
2.5
|
|
|
3.2
|
|
||
Actuarial (gain) loss
|
|
(5.5
|
)
|
|
7.6
|
|
||
Benefits paid
|
|
(2.9
|
)
|
|
(2.9
|
)
|
||
Currency fluctuation adjustment
|
|
(4.0
|
)
|
|
(4.7
|
)
|
||
Benefit obligation as of December 31
|
|
66.9
|
|
|
76.8
|
|
||
Change in plan assets:
|
|
|
|
|
|
|
||
Fair value as of January 1
|
|
70.3
|
|
|
66.7
|
|
||
Actual return
|
|
1.9
|
|
|
9.2
|
|
||
Company contributions
|
|
1.5
|
|
|
1.6
|
|
||
Currency fluctuation adjustment
|
|
(3.9
|
)
|
|
(4.3
|
)
|
||
Benefits paid
|
|
(2.9
|
)
|
|
(2.9
|
)
|
||
Fair value of plan assets as of December 31
|
|
66.9
|
|
|
70.3
|
|
||
Underfunded status of the plan
|
|
$
|
—
|
|
|
$
|
(6.5
|
)
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Interest cost on projected benefit obligation
|
|
$
|
2.5
|
|
|
$
|
3.2
|
|
|
$
|
3.0
|
|
Prior service cost
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|||
Expected return on plan assets
|
|
(2.9
|
)
|
|
(3.5
|
)
|
|
(2.8
|
)
|
|||
Net amortization
|
|
1.5
|
|
|
1.7
|
|
|
1.8
|
|
|||
Net pension expense
|
|
$
|
1.0
|
|
|
$
|
1.3
|
|
|
$
|
1.9
|
|
|
64
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
65
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
2015
|
|
2014
|
||||
Term Loan due May 2017
|
|
$
|
472.5
|
|
|
$
|
376.4
|
|
Revolving Credit Facility due August 2017
|
|
4.5
|
|
|
—
|
|
||
4.875% Senior Notes due July 2024
|
|
250.0
|
|
|
250.0
|
|
||
|
|
727.0
|
|
|
626.4
|
|
||
Less current portion
|
|
(4.9
|
)
|
|
(3.9
|
)
|
||
Long-term debt
|
|
$
|
722.1
|
|
|
$
|
622.5
|
|
|
Debt
Maturity
|
||
2016
|
$
|
4.9
|
|
2017
|
472.1
|
|
|
2018
|
—
|
|
|
2019
|
—
|
|
|
2020
|
—
|
|
|
Thereafter
|
250.0
|
|
|
Total
|
$
|
727.0
|
|
|
|
66
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
Derivatives designated as hedging instruments
(a)
:
|
|
Balance Sheet Location
|
|
December 31, 2015
|
|
Balance Sheet Location
|
|
December 31, 2015
|
||||
Commodity contracts
(b)
|
|
Other current assets
|
|
$
|
0.1
|
|
|
Accrued expenses
|
|
$
|
2.6
|
|
Commodity contracts
|
|
Other assets
|
|
—
|
|
|
Other noncurrent liabilities
|
|
0.1
|
|
||
Total derivatives designated as hedging instruments
|
|
|
|
$
|
0.1
|
|
|
|
|
$
|
2.7
|
|
(a)
|
The Company has commodity hedge agreements with
two
counterparties. Amounts recorded as liabilities for the Company’s commodity contracts are payable to both counterparties.
|
(b)
|
The Company has master netting agreements with its counterparties and accordingly has netted in its consolidated balance sheets approximately
$0.1 million
of its commodity contracts that are in a receivable position against its contracts in payable positions.
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
Derivatives designated as hedging instruments
(a)
:
|
|
Balance Sheet Location
|
|
December 31, 2014
|
|
Balance Sheet Location
|
|
December 31, 2014
|
||||
Commodity contracts
(b)
|
|
Other current assets
|
|
$
|
0.1
|
|
|
Accrued expenses
|
|
$
|
2.5
|
|
Commodity contracts
|
|
Other assets
|
|
—
|
|
|
Other noncurrent liabilities
|
|
1.0
|
|
||
Total derivatives designated as hedging instruments
|
|
|
|
$
|
0.1
|
|
|
|
|
$
|
3.5
|
|
(a)
|
The Company has commodity hedge agreements with
four
counterparties. Amounts recorded as liabilities for the Company’s commodity contracts are payable to all counterparties. The amount recorded as an asset is due from
two
counterparties.
|
(b)
|
The Company has master netting agreements with its counterparties and accordingly has netted in its consolidated balance sheets approximately
$0.1 million
of its commodity contracts that are in a receivable position against its contracts in payable positions.
|
|
|
|
|
Twelve Months Ended December 31, 2015
|
||||||
Derivatives in Cash Flow Hedging Relationships
|
|
Location of Gain
(Loss) Reclassified
from Accumulated
OCI Into Income
(Effective Portion)
|
|
Amount of (Gain)
Loss Recognized in
OCI on Derivative
(Effective Portion)
|
|
Amount of Gain
(Loss) Reclassified
from Accumulated
OCI Into Income
(Effective Portion)
|
||||
Commodity contracts
|
|
Product cost
|
|
$
|
2.4
|
|
|
$
|
(3.1
|
)
|
Total
|
|
|
|
$
|
2.4
|
|
|
$
|
(3.1
|
)
|
|
|
|
|
Twelve Months Ended December 31, 2014
|
||||||
Derivatives in Cash Flow Hedging Relationships
|
|
Location of Gain
(Loss) Reclassified
from Accumulated
OCI Into Income
(Effective Portion)
|
|
Amount of (Gain)
Loss Recognized in
OCI on Derivative
(Effective Portion)
|
|
Amount of Gain
(Loss) Reclassified
from Accumulated
OCI Into Income
(Effective Portion)
|
||||
Commodity contracts
|
|
Product cost
|
|
$
|
2.8
|
|
|
$
|
1.0
|
|
Total
|
|
|
|
$
|
2.8
|
|
|
$
|
1.0
|
|
|
|
67
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
Operating
Leases
|
||
2016
|
$
|
15.7
|
|
2017
|
9.7
|
|
|
2018
|
4.1
|
|
|
2019
|
3.6
|
|
|
2020
|
1.9
|
|
|
Thereafter
|
5.0
|
|
|
Total
|
$
|
40.0
|
|
|
68
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
69
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
Stock Options
|
|
RSUs
|
|
PSUs
|
|||||||||||||||
|
|
Number
|
|
Weighted-average
exercise price
|
|
Number
|
|
Weighted-average
fair value
|
|
Number
|
|
Weighted-average
fair value
|
|||||||||
Outstanding at
December 31, 2012
|
|
435,721
|
|
|
$
|
67.46
|
|
|
77,749
|
|
|
$
|
78.46
|
|
|
49,932
|
|
|
$
|
83.58
|
|
Granted
|
|
124,370
|
|
|
76.84
|
|
|
65,521
|
|
|
74.99
|
|
|
29,134
|
|
|
78.01
|
|
|||
Exercised
(a)
|
|
(174,149
|
)
|
|
60.71
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Released from restriction
(a)
|
|
—
|
|
|
—
|
|
|
(22,658
|
)
|
|
78.46
|
|
|
(6,341
|
)
|
|
86.51
|
|
|||
Cancelled/Expired
|
|
(57,578
|
)
|
|
77.19
|
|
|
(24,894
|
)
|
|
78.42
|
|
|
(17,576
|
)
|
|
81.72
|
|
|||
Outstanding at
December 31, 2013
|
|
328,364
|
|
|
$
|
72.88
|
|
|
95,718
|
|
|
$
|
76.09
|
|
|
55,149
|
|
|
$
|
80.89
|
|
Granted
|
|
95,610
|
|
|
87.18
|
|
|
20,268
|
|
|
86.74
|
|
|
27,574
|
|
|
105.77
|
|
|||
Exercised
(a)
|
|
(112,005
|
)
|
|
67.35
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Released from restriction
(a)
|
|
—
|
|
|
—
|
|
|
(15,636
|
)
|
|
86.48
|
|
|
(3,998
|
)
|
|
93.82
|
|
|||
Cancelled/Expired
|
|
(33,540
|
)
|
|
79.81
|
|
|
(11,818
|
)
|
|
76.95
|
|
|
(19,098
|
)
|
|
89.77
|
|
|||
Outstanding at
December 31, 2014
|
|
278,429
|
|
|
$
|
79.23
|
|
|
88,532
|
|
|
$
|
76.58
|
|
|
59,627
|
|
|
$
|
88.69
|
|
Granted
|
|
120,956
|
|
|
91.76
|
|
|
21,317
|
|
|
90.94
|
|
|
35,584
|
|
|
100.49
|
|
|||
Exercised
(a)
|
|
(33,906
|
)
|
|
72.53
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Released from restriction
(a)
|
|
—
|
|
|
—
|
|
|
(15,952
|
)
|
|
71.69
|
|
|
(10,454
|
)
|
|
74.49
|
|
|||
Cancelled/Expired
(b)
|
|
(12,392
|
)
|
|
84.71
|
|
|
(2,889
|
)
|
|
81.43
|
|
|
(7,392
|
)
|
|
82.46
|
|
|||
Outstanding at December 31, 2015
|
|
353,087
|
|
|
$
|
83.94
|
|
|
91,008
|
|
|
$
|
80.65
|
|
|
77,365
|
|
|
$
|
96.63
|
|
(a)
|
Common stock issued for exercised options and RSUs and PSUs released from restriction were issued from treasury shares.
|
(b)
|
The performance period for the
2013
PSU grant was completed in
2015
. The Company expects to issue
9,914
shares in March 2016 when the
2013
PSU grant vests.
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Fair value of options granted
|
|
$
|
14.78
|
|
|
$
|
15.25
|
|
|
$
|
19.06
|
|
Expected term (years)
|
|
4.8
|
|
|
4.8
|
|
|
4.7
|
|
|||
Expected volatility
|
|
24.9
|
%
|
|
27.8
|
%
|
|
38.0
|
%
|
|||
Dividend yield
|
|
3.1
|
%
|
|
3.4
|
%
|
|
3.0
|
%
|
|||
Risk-free interest rates
|
|
1.6
|
%
|
|
1.5
|
%
|
|
0.9
|
%
|
|
70
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||
Range of
exercise prices
|
|
Options
outstanding
|
|
Weighted-average
remaining
contractual life
(years)
|
|
Weighted-average
exercise price
of options
outstanding
|
|
Options
exercisable
|
|
Weighted-average
remaining
contractual life
(years)
|
|
Weighted-average
exercise
price of exercisable
options
|
||||||
$58.99 - $77.75
|
|
114,116
|
|
|
3.7
|
|
$
|
74.16
|
|
|
63,633
|
|
|
3.3
|
|
$
|
72.74
|
|
$77.76 - $86.99
|
|
42,130
|
|
|
1.7
|
|
82.51
|
|
|
42,130
|
|
|
1.7
|
|
82.51
|
|
||
$87.00 - $89.47
|
|
79,717
|
|
|
5.2
|
|
87.18
|
|
|
18,445
|
|
|
5.2
|
|
87.18
|
|
||
$89.48 - $93.26
|
|
117,124
|
|
|
6.2
|
|
91.77
|
|
|
74
|
|
|
6.2
|
|
91.75
|
|
||
Totals
|
|
353,087
|
|
|
4.6
|
|
$
|
83.94
|
|
|
124,282
|
|
|
3.1
|
|
$
|
78.21
|
|
Twelve Months Ended December 31, 2015
(a)
|
|
Gains and
(Losses) on
Cash Flow
Hedges
|
|
Defined
Benefit
Pension
|
|
Foreign
Currency
|
|
Total
|
||||||||
Beginning balance
|
|
$
|
(2.0
|
)
|
|
$
|
(9.0
|
)
|
|
$
|
(4.5
|
)
|
|
$
|
(15.5
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
(1.5
|
)
|
|
4.1
|
|
|
(98.4
|
)
|
|
(95.8
|
)
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
|
1.9
|
|
|
1.1
|
|
|
—
|
|
|
3.0
|
|
||||
Net current period other comprehensive income (loss)
|
|
0.4
|
|
|
5.2
|
|
|
(98.4
|
)
|
|
(92.8
|
)
|
||||
Ending balance
|
|
$
|
(1.6
|
)
|
|
$
|
(3.8
|
)
|
|
$
|
(102.9
|
)
|
|
$
|
(108.3
|
)
|
(a)
|
With the exception of the cumulative foreign currency translation adjustment, for which no tax effect is recorded, the changes in the components of accumulated other comprehensive gain (loss) presented in the table are reflected net of applicable income taxes.
|
|
71
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
Twelve Months Ended December 31, 2014
(a)
|
|
Gains and
(Losses) on
Cash Flow
Hedges
|
|
Defined
Benefit
Pension
|
|
Foreign
Currency
|
|
Total
|
||||||||
Beginning balance
|
|
$
|
0.3
|
|
|
$
|
(9.3
|
)
|
|
$
|
43.5
|
|
|
$
|
34.5
|
|
Other comprehensive income (loss) before reclassifications
|
|
(1.7
|
)
|
|
(1.0
|
)
|
|
(48.0
|
)
|
|
(50.7
|
)
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
|
(0.6
|
)
|
|
1.3
|
|
|
—
|
|
|
0.7
|
|
||||
Net current period other comprehensive income (loss)
|
|
(2.3
|
)
|
|
0.3
|
|
|
(48.0
|
)
|
|
(50.0
|
)
|
||||
Ending balance
|
|
$
|
(2.0
|
)
|
|
$
|
(9.0
|
)
|
|
$
|
(4.5
|
)
|
|
$
|
(15.5
|
)
|
(a)
|
With the exception of the cumulative foreign currency translation adjustment, for which no tax effect is recorded, the changes in the components of accumulated other comprehensive gain (loss) presented in the table are reflected net of applicable income taxes.
|
|
|
Amount
Reclassified from AOCI
|
|
|
||
|
|
Twelve Months Ended
December 31, 2015
|
|
Line Item Impacted in the
Consolidated Statement of Operations
|
||
Gains and (losses) on cash flow hedges:
|
|
|
|
|
||
Natural gas instruments
|
|
$
|
3.1
|
|
|
Product cost
|
|
|
(1.2
|
)
|
|
Income tax expense (benefit)
|
|
|
|
1.9
|
|
|
|
|
Amortization of defined benefit pension:
|
|
|
|
|
|
|
Amortization of loss
|
|
$
|
1.4
|
|
|
Product cost
|
|
|
(0.3
|
)
|
|
Income tax expense (benefit)
|
|
|
|
1.1
|
|
|
|
|
Total reclassifications, net of income taxes
|
|
$
|
3.0
|
|
|
|
|
|
Amount
Reclassified from AOCI
|
|
|
||
|
|
Twelve Months Ended
December 31, 2014
|
|
Line Item Impacted in the
Consolidated Statement of Operations
|
||
Gains and (losses) on cash flow hedges:
|
|
|
|
|
|
|
Natural gas instruments
|
|
$
|
(1.0
|
)
|
|
Product cost
|
|
|
0.4
|
|
|
Income tax expense (benefit)
|
|
|
|
(0.6
|
)
|
|
|
|
Amortization of defined benefit pension:
|
|
|
|
|
|
|
Amortization of loss
|
|
$
|
1.6
|
|
|
Product cost
|
|
|
(0.3
|
)
|
|
Income tax expense (benefit)
|
|
|
|
1.3
|
|
|
|
|
Total reclassifications, net of income taxes
|
|
$
|
0.7
|
|
|
|
|
|
72
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
December 31, 2015
|
|
Level One
|
|
Level Two
|
|
Level Three
|
||||||||
Asset Class:
|
|
|
|
|
|
|
|
|
||||||||
Mutual fund investments in a non-qualified savings plan
(a)
|
|
$
|
1.6
|
|
|
$
|
1.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Assets
|
|
$
|
1.6
|
|
|
$
|
1.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liability Class:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities related to non-qualified savings plan
|
|
$
|
(1.6
|
)
|
|
$
|
(1.6
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Derivatives – natural gas instruments
|
|
(2.6
|
)
|
|
—
|
|
|
(2.6
|
)
|
|
—
|
|
||||
Total Liabilities
|
|
$
|
(4.2
|
)
|
|
$
|
(1.6
|
)
|
|
$
|
(2.6
|
)
|
|
$
|
—
|
|
(a)
|
Includes mutual fund investments of approximately
20%
in the common stock of large-cap U.S. companies, approximately
5%
in the common stock of small to mid-cap U.S. companies, approximately
5%
in the common stock of international companies, approximately
5%
in bond funds, approximately
35%
in short-term investments and approximately
30%
in blended funds.
|
|
|
December 31, 2014
|
|
Level One
|
|
Level Two
|
|
Level Three
|
||||||||
Asset Class:
|
|
|
|
|
|
|
|
|
||||||||
Mutual fund investments in a non-qualified savings plan
(a)
|
|
$
|
1.9
|
|
|
$
|
1.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Assets
|
|
$
|
1.9
|
|
|
$
|
1.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liability Class:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities related to non-qualified savings plan
|
|
$
|
(1.9
|
)
|
|
$
|
(1.9
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Derivatives – natural gas instruments
|
|
(3.4
|
)
|
|
—
|
|
|
(3.4
|
)
|
|
—
|
|
||||
Total Liabilities
|
|
$
|
(5.3
|
)
|
|
$
|
(1.9
|
)
|
|
$
|
(3.4
|
)
|
|
$
|
—
|
|
(a)
|
Includes mutual fund investments of approximately
15%
in the common stock of large-cap U.S. companies, approximately
5%
in the common stock of international companies, approximately
5%
in bond funds, approximately
35%
in short-term investments and approximately
40%
in blended funds.
|
|
|
73
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
2015
|
|
Salt
|
|
Plant
Nutrition
|
|
Corporate
& Other
(a)
|
|
Total
|
||||||||
Sales to external customers
|
|
$
|
849.0
|
|
|
$
|
238.4
|
|
|
$
|
11.3
|
|
|
$
|
1,098.7
|
|
Intersegment sales
|
|
0.1
|
|
|
7.7
|
|
|
(7.8
|
)
|
|
—
|
|
||||
Shipping and handling cost
|
|
239.1
|
|
|
22.4
|
|
|
—
|
|
|
261.5
|
|
||||
Operating earnings (loss)
|
|
215.2
|
|
|
57.9
|
|
|
(51.7
|
)
|
|
221.4
|
|
||||
Depreciation, depletion and amortization
|
|
43.9
|
|
|
29.8
|
|
|
4.6
|
|
|
78.3
|
|
||||
Total assets
(b)
|
|
896.5
|
|
|
679.7
|
|
|
52.7
|
|
|
1,628.9
|
|
||||
Capital expenditures
|
|
106.5
|
|
|
92.8
|
|
|
18.3
|
|
|
217.6
|
|
2014
|
|
Salt
|
|
Plant
Nutrition
|
|
Corporate
& Other
(a)
|
|
Total
|
||||||||
Sales to external customers
|
|
$
|
1,002.6
|
|
|
$
|
270.2
|
|
|
$
|
9.7
|
|
|
$
|
1,282.5
|
|
Intersegment sales
|
|
0.9
|
|
|
7.1
|
|
|
(8.0
|
)
|
|
—
|
|
||||
Shipping and handling cost
|
|
309.3
|
|
|
28.4
|
|
|
—
|
|
|
337.7
|
|
||||
Operating earnings (loss)
(c)
|
|
291.4
|
|
|
74.8
|
|
|
(55.2
|
)
|
|
311.0
|
|
||||
Depreciation, depletion and amortization
|
|
44.8
|
|
|
27.3
|
|
|
5.9
|
|
|
78.0
|
|
||||
Total assets
|
|
1,045.2
|
|
|
536.2
|
|
|
55.8
|
|
|
1,637.2
|
|
||||
Capital expenditures
|
|
67.9
|
|
|
42.1
|
|
|
15.2
|
|
|
125.2
|
|
2013
|
|
Salt
|
|
Plant
Nutrition
|
|
Corporate
& Other
(a)
|
|
Total
|
||||||||
Sales to external customers
|
|
$
|
920.5
|
|
|
$
|
198.6
|
|
|
$
|
10.5
|
|
|
$
|
1,129.6
|
|
Intersegment sales
|
|
0.9
|
|
|
7.2
|
|
|
(8.1
|
)
|
|
—
|
|
||||
Shipping and handling cost
|
|
280.7
|
|
|
21.0
|
|
|
—
|
|
|
301.7
|
|
||||
Operating earnings (loss)
(b)
|
|
181.3
|
|
|
58.7
|
|
|
(54.4
|
)
|
|
185.6
|
|
||||
Depreciation, depletion and amortization
|
|
45.1
|
|
|
23.8
|
|
|
4.1
|
|
|
73.0
|
|
||||
Total assets
|
|
942.2
|
|
|
386.8
|
|
|
75.8
|
|
|
1,404.8
|
|
||||
Capital expenditures
(d)
|
|
79.8
|
|
|
38.8
|
|
|
4.1
|
|
|
122.7
|
|
(a)
|
Corporate and Other includes corporate entities, records management operations and other incidental operations and eliminations. Operating earnings (loss) for corporate and other includes indirect corporate overhead including costs for general corporate governance and oversight, as well as costs for the human resources, information technology and finance functions. In
2014
, the operating earnings loss includes costs of approximately
$4.2 million
to consolidate its records management locations by closing
one
location in London, England.
|
(b)
|
In 2015, the Company's equity investment in Produquímica is included in total assets for its plant nutrition segment. In addition, the Company's assets held for sale have been presented in corporate and other. Total assets in 2015 for both operating segments were negatively impacted by the impact of translating our foreign-denominated assets into U.S. dollars.
|
(c)
|
In
2014
, the Company recorded a gain of
$82.3 million
in the salt segment and
$1.0 million
in corporate and other resulting from an insurance settlement related to a tornado at its salt facilities in Goderich, Ontario in August 2011. In the fourth quarter of
2013
, the Company recognized a gain of
$9 million
in its plant nutrition segment from the settlement of an insurance claim resulting from a loss of mineral-concentrated brine due to an asset failure at its solar evaporation ponds in 2010 and a charge of
$4.7 million
in its salt segment from a ruling against the Company related to a labor matter.
|
(d)
|
The salt segment includes approximately
$15 million
of capital expenditures during
2013
to replace and, in some instances, improve property, plant and equipment damaged or destroyed by the tornado at the Company’s Goderich, Ontario facilities in 2011.
|
|
74
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
Sales
|
|
2015
|
|
2014
|
|
2013
|
||||||
United States
(a)
|
|
$
|
834.6
|
|
|
$
|
975.2
|
|
|
$
|
774.3
|
|
Canada
|
|
198.4
|
|
|
260.0
|
|
|
256.7
|
|
|||
United Kingdom
|
|
56.8
|
|
|
41.2
|
|
|
87.1
|
|
|||
Other
|
|
8.9
|
|
|
6.1
|
|
|
11.5
|
|
|||
Total sales
|
|
$
|
1,098.7
|
|
|
$
|
1,282.5
|
|
|
$
|
1,129.6
|
|
(a)
|
United States sales exclude product sold to foreign customers at U.S. ports.
|
Long-Lived Assets
|
|
2015
|
|
2014
|
||||
United States
|
|
$
|
502.1
|
|
|
$
|
420.0
|
|
Canada
|
|
394.3
|
|
|
413.7
|
|
||
United Kingdom
|
|
95.7
|
|
|
92.3
|
|
||
Brazil
|
|
116.4
|
|
|
—
|
|
||
Other
|
|
6.5
|
|
|
6.6
|
|
||
Total long-lived assets
|
|
$
|
1,115.0
|
|
|
$
|
932.6
|
|
|
Year ended December 31,
|
|
2015
|
|
2014
|
|
2013
|
||||||
Numerator:
|
|
|
|
|
|
|
||||||
Net earnings
|
|
$
|
159.2
|
|
|
$
|
217.9
|
|
|
$
|
130.8
|
|
Less: Net earnings allocated to participating securities
(a)
|
|
(1.0
|
)
|
|
(1.5
|
)
|
|
(1.0
|
)
|
|||
Net earnings available to common shareholders
|
|
$
|
158.2
|
|
|
$
|
216.4
|
|
|
$
|
129.8
|
|
Denominator (in thousands):
|
|
|
|
|
|
|
|
|
|
|||
Weighted average common shares outstanding, shares for basic earnings per share
(b)
|
|
33,677
|
|
|
33,557
|
|
|
33,403
|
|
|||
Weighted average equity awards outstanding
|
|
15
|
|
|
24
|
|
|
17
|
|
|||
Shares for diluted earnings per share
|
|
33,692
|
|
|
33,581
|
|
|
33,420
|
|
|||
Net earnings per common share, basic
|
|
$
|
4.70
|
|
|
$
|
6.45
|
|
|
$
|
3.89
|
|
Net earnings per common share, diluted
|
|
$
|
4.69
|
|
|
$
|
6.44
|
|
|
$
|
3.88
|
|
(a)
|
Participating securities include options, PSUs and RSUs that receive non-forfeitable dividends. Net earnings were allocated to participating securities of
198,000
,
227,000
and
250,000
for
2015
,
2014
and
2013
, respectively.
|
(b)
|
For the calculation of diluted earnings per share, the Company uses the more dilutive of either the treasury stock method or the two-class method, to determine the weighted average number of outstanding common shares. In addition, the Company had
432,000
,
381,000
and
455,000
weighted options outstanding for
2015
,
2014
and
2013
, respectively, which were anti-dilutive and therefore not included in the diluted earnings per share calculation.
|
|
75
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
Quarter
|
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
2015
|
|
|
|
|
|
|
|
|
||||||||
Sales
|
|
$
|
393.0
|
|
|
$
|
183.7
|
|
|
$
|
232.7
|
|
|
$
|
289.3
|
|
Gross profit
|
|
113.2
|
|
|
50.6
|
|
|
68.0
|
|
|
98.3
|
|
||||
Net earnings
|
|
60.6
|
|
|
13.2
|
|
|
27.0
|
|
|
58.4
|
|
||||
Net earnings per share, basic
|
|
1.79
|
|
|
0.39
|
|
|
0.80
|
|
|
1.72
|
|
||||
Net earnings per share, diluted
|
|
1.79
|
|
|
0.39
|
|
|
0.80
|
|
|
1.72
|
|
||||
Basic weighted-average shares outstanding (in thousands)
|
|
33,626
|
|
|
33,682
|
|
|
33,696
|
|
|
33,701
|
|
||||
Diluted weighted-average shares outstanding (in thousands)
|
|
33,649
|
|
|
33,701
|
|
|
33,708
|
|
|
33,714
|
|
||||
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Sales
|
|
$
|
422.0
|
|
|
$
|
186.6
|
|
|
$
|
240.5
|
|
|
$
|
433.4
|
|
Gross profit
(a)
|
|
92.3
|
|
|
37.5
|
|
|
149.8
|
|
|
141.8
|
|
||||
Net earnings (loss)
(a)
|
|
50.2
|
|
|
(0.7
|
)
|
|
87.9
|
|
|
80.5
|
|
||||
Net earnings (loss) per share, basic
|
|
1.49
|
|
|
(0.02
|
)
|
|
2.60
|
|
|
2.38
|
|
||||
Net earnings (loss) per share, diluted
|
|
1.49
|
|
|
(0.02
|
)
|
|
2.60
|
|
|
2.38
|
|
||||
Basic weighted-average shares outstanding (in thousands)
|
|
33,502
|
|
|
33,549
|
|
|
33,575
|
|
|
33,600
|
|
||||
Diluted weighted-average shares outstanding (in thousands)
|
|
33,520
|
|
|
33,549
|
|
|
33,601
|
|
|
33,617
|
|
(a)
|
In the third quarter of
2014
, the Company recognized a gain of
$83.3 million
(
$60.6 million
, net of taxes) from an insurance settlement relating to damage it sustained as a result of a tornado that struck its rock salt mine and evaporation plan in Goderich, Ontario, in 2011. The Company recognized
$82.3 million
of the gain in product cost and
$1.0 million
of the gain in selling, general and administrative expenses in the consolidated statements of operations. In the second quarter of
2014
, the Company incurred costs of
$6.9 million
(
$5.1 million
, net of taxes) related to the refinancing of its
8%
Senior Notes with
4.875%
Senior Notes.
|
|
|
76
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
|
|
|
|
77
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
ITEM 12.
|
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
|
|
|
|
78
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
Description
|
Page
|
|
|
Management’s Report on Internal Controls Over Financial Reporting
|
77
|
|
|
Reports of Independent Registered Public Accounting Firm
|
45
|
|
|
Consolidated Balance Sheets as of December 31, 2015 and 2014
|
47
|
|
|
Consolidated Statements of Operations for each of the three years in the period ended December 31, 2015
|
48
|
|
|
Consolidated Statements of Comprehensive Income for each of the three years in the period ended December 31, 2015
|
49
|
|
|
Consolidated Statements of Stockholders’ Equity for each of the three years in the period ended December 31, 2015
|
50
|
|
|
Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2015
|
51
|
|
|
Notes to Consolidated Financial Statements
|
52
|
|
|
Schedule II – Valuation Reserves
|
79
|
|
Description (in millions)
|
|
Balance at
the
Beginning
of the Year
|
|
Additions
(Deductions)
Charged to
Expense
|
|
Deductions
(1)
|
|
Balance at
the End of
the Year
|
||||||||
Deducted from Receivables — Allowance for Doubtful Accounts
|
|
|
|
|
|
|
|
|
||||||||
2015
|
|
$
|
1.4
|
|
|
$
|
0.6
|
|
|
$
|
(0.7
|
)
|
|
$
|
1.3
|
|
2014
|
|
1.6
|
|
|
0.3
|
|
|
(0.5
|
)
|
|
1.4
|
|
||||
2013
|
|
2.4
|
|
|
0.7
|
|
|
(1.5
|
)
|
|
1.6
|
|
||||
Deducted from Deferred Income Taxes — Valuation Allowance
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
2015
|
|
$
|
1.0
|
|
|
$
|
0.1
|
|
|
$
|
(0.2
|
)
|
|
$
|
0.9
|
|
2014
|
|
1.1
|
|
|
0.2
|
|
|
(0.3
|
)
|
|
1.0
|
|
||||
2013
|
|
1.3
|
|
|
—
|
|
|
(0.2
|
)
|
|
1.1
|
|
(1)
|
Deduction for purposes for which reserve was created.
|
|
79
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
Exhibit
No.
|
Description of Exhibit
|
2.1
|
Agreement and Plan of Merger, dated October 13, 2001, among IMC Global Inc., Compass Minerals International, Inc. (formerly known as Salt Holdings Corporation), YBR Holdings LLC and YBR Acquisition Corp (incorporated herein by reference to Exhibit 2.1 to Compass Minerals’ Registration Statement on Form S-4, File No. 333-104603).
|
2.2
|
Amendment No. 1 to Agreement and Plan of Merger, dated November 28, 2001, among IMC Global Inc., Compass Minerals International, Inc. (formerly known as Salt Holdings Corporation), YBR Holdings LLC and YBR Acquisition Corp (incorporated herein by reference to Exhibit 2.2 to Compass Minerals Registration Statement on Form S-4, File No. 333-104603).
|
2.3*
|
Subscription Agreement between Compass Minerals Do Brazil LTDA, a subsidiary of Compass Minerals
International, Inc. and Produquímica Indústria e Comércio S.A., dated December 16, 2015. The schedules and exhibits to the Subscription Agreement are omitted pursuant to Item 601(b)(2) of Regulation S-K. Compass Minerals agrees to furnish supplementally to the SEC, upon request, a copy of any omitted schedule or exhibit.
|
2.4*
|
Sale and Purchase Agreement among Compass Minerals Do Brasil LTDA, a subsidiary of Compass Minerals
International, Inc. and certain of the current shareholders of Produquímica Indústria e Comércio S.A., dated December 16, 2015. The schedules and exhibits to the Sale and Purchase Agreement are omitted pursuant to Item 601(b)(2) of Regulation S-K. Compass Minerals agrees to furnish supplementally to the SEC, upon request, a copy of any omitted schedule or exhibit.
|
3.1
|
Amended and Restated Certificate of Incorporation of Compass Minerals International, Inc. (incorporated herein by reference to Exhibit 3.1 to Compass Minerals International, Inc.’s Registration Statement on Form S-4, File No. 333-111953).
|
3.2
|
By-laws of Compass Minerals International, Inc., amended and restated as of December 22, 2014 (incorporated herein by reference to Exhibit 3.2 to Compass Minerals International, Inc.’s Current Report on Form 8-K filed December 23, 2014).
|
4.1
|
Indenture, dated as of June 23, 2014, by and among Compass Minerals International, Inc., the Guarantors named therein, and U.S. National Bank Association, as trustee, relating to the 4.875% Senior Notes due 2024 (incorporated herein by reference to Exhibit 4.1 to Compass Minerals International, Inc.’s Current Report on Form 8-K filed June 26, 2014).
|
4.2
|
Form of 4.875% Senior Notes due 2024 (included as Exhibit 1 to Exhibit 4.1).
|
10.1
|
Salt mining lease, dated November 9, 2001, between the Province of Ontario, as lessor, and Sifto Canada Inc. as lessee (incorporated herein by reference to Exhibit 10.1 to Compass Minerals’ Registration Statement on Form S-4, File No. 333-104603).
|
10.2
|
Amended and Restated Salt and Surface Lease effective as of January 1, 2014 by and between Island Partnership, L.L.C., JMB Cote Blanche L.L.C., CFB, LLC and Carey Salt Company dated January 1, 2014 (incorporated herein by reference to Exhibit 10.7 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014).
|
10.3
|
Royalty Agreement, dated September 1, 1962, between Great Salt Lake Minerals Corporation and the Utah State Land Board (incorporated herein by reference to Exhibit 10.3 to Compass Minerals’ Registration Statement on Form S-4, File No. 333-104603).
|
10.4***
|
Amended and Restated Credit Agreement, dated December 22, 2005, among Compass Minerals International, Inc., Compass Minerals Group, Inc., as U.S. borrower, Sifto Canada Corp., as Canadian borrower, Salt Union Limited, as U.K. borrower, JPMorgan Chase Bank N.A., as administrative agent, J.P. Morgan Securities Inc., as co-lead arranger and joint bookrunner, Goldman Sachs Credit Partners L.P., as co-lead arranger and joint bookrunner, Calyon New York Branch, as syndication agent, Bank of America, N.A., as co-documentation agent, and The Bank of Nova Scotia, as co-documentation agent (incorporated herein by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2010).
|
10.5***
|
Amendment and Restatement Agreement dated as of May 18, 2012, to the Credit Agreement dated as of November 28, 2001 among Compass Minerals International, Inc., Sifto Canada Corp., Salt Union Limited, the lenders party thereto from time to time and JPMorgan Chase Bank, N.A. as administrative agent (incorporated herein by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s Current Report on Form 8-K filed May 24, 2012).
|
10.6
|
Amendment dated December 20, 2013 to Credit Agreement dated as of November 28, 2001 among Compass Minerals International, Inc., Sifto Canada Corp., Salt Union Limited, the lenders party thereto from time to time and JPMorgan Chase Bank, N.A., as administrative agent (incorporated herein by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s Current Report on Form 8-K dated December 23, 2013) and to the US Collateral and Guaranty Agreement dated as of September 30, 2010 among Compass Minerals International, Inc., each subsidiary of Compass Minerals International, Inc. party thereto and JPMorgan Chase Bank, N.A. as collateral agent (incorporated herein by reference to Exhibit 10.2 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2010).
|
|
80
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
10.7
|
Amended and Restated U.S. Collateral Assignment, dated December 22, 2005, among Compass Minerals International, Inc., Compass Minerals Group, Inc. and JPMorgan Chase Bank N.A (incorporated herein by reference to Exhibit 10.12 to Compass Minerals International, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2005).
|
10.8
|
Amendment No. 1 to the US Collateral and Guaranty Agreement dated as of September 30, 2010 among Compass Minerals International, Inc., each subsidiary of Compass Minerals International, Inc. party thereto and JPMorgan Chase Bank, N.A. as collateral agent (incorporated herein by reference to Exhibit 10.2 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2010).
|
10.9
|
Amended and Restated Foreign Guaranty, dated December 22, 2005, among Sifto Canada Corp., Salt Union Limited, Compass Minerals (Europe) Limited, Compass Minerals (UK) Limited, DeepStore Limited (formerly known as London Salt Limited), Compass Minerals (No. 1) Limited (formerly known as Direct Salt Supplies Limited), J.T. Lunt & Co. (Nantwich) Limited, NASC Nova Scotia Company, Compass Minerals Canada Inc., Compass Canada Limited Partnership, Compass Minerals Nova Scotia Company, Compass Resources Canada Company and JPMorgan Chase Bank, N.A., as collateral agent (incorporated herein by reference to Exhibit 10.13 to Compass Minerals International, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2005).
|
10.10
|
Certificate of Designation for the Series A Junior Participating Preferred Stock, par value $0.01 per share (incorporated herein by reference to Exhibit 4.1 to Compass Minerals International, Inc.’s Current Report on Form 8-K filed December 19, 2012).
|
10.11
|
Compass Minerals International, Inc. Directors’ Deferred Compensation Plan, Amended and Restated Effective as of January 1, 2005 (incorporated herein by reference to Exhibit 10.26 to Compass Minerals International, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2006).
|
10.12
|
First Amendment to the Compass Minerals International, Inc. Directors’ Deferred Compensation Plan effective January 1, 2007 (incorporated herein by reference to Exhibit 10.28 to Compass Minerals International, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2006).
|
10.13
|
Second Amendment to the Compass Minerals International, Inc. Directors’ Deferred Compensation Plan (incorporated herein by reference to Exhibit 10.4 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009).
|
10.14*
|
2016 Summary of Non-Employee Director Compensation.
|
10.15
|
Amendment to 2012 and 2013 Independent Director Deferred Stock Award Agreement for Eric Ford (incorporated herein by reference to Exhibit 10.15 to Compass Minerals International, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2013).
|
10.16
|
Compass Minerals International, Inc. Form of 2012 Independent Director Deferred Stock Award Agreement (incorporated herein by reference to Exhibit 10.3 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012).
|
10.17
|
Compass Minerals International, Inc. Form of 2014 Foreign Director Deferred Stock Award Agreement (incorporated herein by reference to Exhibit 10.6 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014).
|
10.18
|
Compass Minerals International, Inc. 2005 Incentive Award Plan as approved by stockholders on August 4, 2005 (incorporated herein by reference to Exhibit 10.15 to Compass Minerals International, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2005).
|
10.19
|
First Amendment to the Compass Minerals International, Inc. 2005 Incentive Award Plan (incorporated herein by reference to Exhibit 10.5 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2007).
|
10.20
|
Second Amendment to the Compass Minerals International, Inc. 2005 Incentive Award Plan (incorporated herein by reference to Exhibit 10.6 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009).
|
10.21
|
Third Amendment to the Compass Minerals International, Inc. 2005 Incentive Award Plan (incorporated herein by reference to Exhibit 10.22 to Compass Minerals International, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011).
|
10.22
|
Fourth Amendment to the Compass Minerals International, Inc. 2005 Incentive Award Plan (incorporated herein by reference to Exhibit 10.23 to Compass Minerals International, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2011).
|
10.23
|
2010 and 2011 Form of Non-Qualified Stock Option Award Agreement (incorporated herein by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2010).
|
10.25
|
2012 Form of Non-Qualified Stock Option Award Agreement (incorporated herein by reference to Exhibit 10.4 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012).
|
10.26
|
2013 Form of Non-Qualified Stock Option Award Agreement (incorporated herein by reference to Exhibit 10.5 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013).
|
|
81
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
10.27
|
2014 Form of Non-Qualified Stock Option Award Agreement (incorporated herein by reference to Exhibit 10.4 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014).
|
10.28
|
2015 Form of Non-Qualified Stock Option Award Agreement (incorporated herein by reference to Exhibit 10.5 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015).
|
10.29
|
Form of Performance-Based Restricted Stock Unit Award Agreement (incorporated herein by reference to Exhibit 10.2 to Compass Minerals International Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2010).
|
10.30
|
2014 Form of Performance-Based Restricted Stock Unit Award Agreement (incorporated herein by reference to Exhibit 10.5 to Compass Minerals International Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014).
|
10.31
|
2015 For of Restricted Stock Unit Award Agreement (incorporated by reference to Exhibit 10.6 to Compass Minerals International, Inc.'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015).
|
10.32
|
2012 Form of Three-Year Performance Stock Unit Award Agreement (incorporated herein by reference to Exhibit 10.1 to Compass Minerals International Inc.’s Quarterly Report for the quarter ended March 31, 2012).
|
10.33
|
2013 Form of Three-Year Performance Stock Unit Award Agreement (incorporated herein by reference to Exhibit 10.4 to Compass Minerals International Inc.’s Quarterly Report for the quarter ended March 31, 2013).
|
10.34
|
2014 Form of Three-Year Performance Stock Unit Award Agreement (incorporated herein by reference to Exhibit 10.3 to Compass Minerals International Inc.’s Quarterly Report for the quarter ended March 31, 2014).
|
10.35
|
2015 Form of Three-Year Performance Stock Unit Award Agreement (ROIC) (incorporated by reference to Exhibit 10.3 to Compass Minerals International, Inc.'s Quarterly Report on Form 10Q for the quarter ended March 31, 2015).
|
10.36
|
2015 Form of Three-Year Performance Stock Unit Award Agreement (rTSR) (incorporated by reference to Exhibit 10.4 to Compass Minerals International, Inc.'s Quarterly Report on Form 10Q for the quarter ended March 31, 2015).
|
10.37
|
Form of Dividend Equivalents Agreement (incorporated herein by reference to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2008).
|
10.38
|
Compass Minerals International, Inc. Restoration Plan (incorporated herein by reference to Exhibit 10.2 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2007).
|
10.39
|
First Amendment to the Compass Minerals International, Inc. Restoration Plan dated as of December 5, 2007 (incorporated herein by reference to Exhibit 10.27 to Compass Minerals International, Inc.’s Annual Report for the year ended December 31, 2007).
|
10.40
|
Second Amendment to the Compass Minerals International, Inc. Restoration Plan (incorporated herein by reference to Exhibit 10.5 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009).
|
10.41
|
2013 Form of Change in Control Severance Agreement (incorporated herein by reference to Exhibit 10.35 to Compass Minerals International, Inc.'s Annual Report for the year ended December 31, 2013).
|
10.42
|
Form of Restrictive Covenant Agreement (included as Exhibit A to Exhibit 10.41).
|
10.43*
|
Listing of certain executive officers as parties to the Change in Control Severance Agreement and Restrictive Covenant Agreement as listed in Exhibits 10.41 and 10.42 herein.
|
10.44
|
Employment Agreement effective January 17, 2013 between Compass Minerals International, Inc. and Fran Malecha (incorporated herein by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s Current Report on Form 8-K filed January 10, 2013).
|
10.45
|
Change in Control Severance Agreement dated January 17, 2013 between Compass Minerals International, Inc. and Fran Malecha (incorporated herein by reference to Exhibit 10.40 to Compass Minerals International, Inc.’s Annual Report on Form 10-K for the annual period ended December 31, 2012).
|
10.46
|
Employment Service Agreement, dated October 27, 2006 between Compass Minerals International, Inc. and David J. Goadby (incorporated herein by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s Current Report on Form 8-K filed November 1, 2006).
|
10.47
|
Summary of Executive Cash Compensation and Award Targets Under the Annual Incentive Plan (incorporated herein by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014).
|
10.48
|
Management Annual Incentive Compensation Plan Summary (incorporated by reference to Exhibit 10.2 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014).
|
10.49
|
Form of Indemnification Agreement for Directors of Compass Minerals International, Inc. (incorporated by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s current Report on Form 8-K filed March 26, 2009).
|
|
82
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
10.50
|
Severance Agreement between Compass Minerals International, Inc. and Rodney Underdown dated July 7, 2014 (incorporated by reference to Exhibit 10.1 to Compass Minerals International, Inc.’s Current Report on Form 8-K dated July 8, 2014).
|
10.51
|
Share Purchase Agreement dated as of March 19, 2014 by and between Compass Minerals Manitoba Inc., Compass Minerals International, Inc. and the shareholders of Wolf Trax Inc. (incorporated herein by reference to Exhibit 10.8 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014.)
|
10.52
|
Rules, Policies and Procedures for Equity Awards Granted to Employees (incorporated by reference to Exhibit
10.7 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015).
|
10.53
|
Offer Letter for Chief Financial Officer dated November 11, 2014 by and between Compass Minerals
International, Inc. and Matthew Foulston (incorporated by reference to Exhibit 10.8 to Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015). |
10.54
|
Compass Minerals International, Inc. 2015 Incentive Award Plan (incorporated by reference to Exhibit 99.1 to
Compass Minerals International, Inc.’s Registration Statement on Form S-8, File No. 333-203922 dated May 6, 2015).
|
10.55
|
2015 Independent Director Deferred Award Agreement (incorporated by reference to Exhibit 10.2 to Compass
Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015).
|
10.56
|
2015 Independent Foreign Director Deferred Award Agreement (incorporated by reference to Exhibit 10.3 to
Compass Minerals International, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015).
|
10.57*
|
Term Loan E among Compass Minerals International, Inc. and certain existing lenders, dated December 14, 2015.
|
12.1*
|
Statement of Computation of Ratio of Earnings to Fixed Charges.
|
21.1*
|
Subsidiaries of the Registrant.
|
23.1*
|
Consent of Ernst & Young LLP.
|
31.1*
|
Section 302 Certifications of Francis J. Malecha, President and Chief Executive Officer.
|
31.2*
|
Section 302 Certifications of Matthew J. Foulston, Chief Financial Officer.
|
32**
|
Certification Pursuant to 18 U.S.C.§1350 of Francis J. Malecha, President and Chief Executive Officer and Matthew J. Foulston, Chief Financial Officer.
|
95*
|
Mine Safety Disclosures.
|
101**
|
The following financial statements from the Compass Minerals International, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2015, formatted in Extensive Business Reporting Language (XBRL): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income (iv) Consolidated Statement of Stockholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) the Notes to the Consolidated Financial Statements.
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
***
|
Confidential treatment has been requested for portions of this exhibit. The confidential portions of the exhibit have been filed separately with the Securities and Exchange Commission.
|
|
83
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
2015 FORM 10-K
|
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
|
|
/s/ Francis J. Malecha
|
|
Francis J. Malecha
|
Date: February 22, 2016
|
President and Chief Executive Officer
|
|
/s/ Matthew J. Foulston
|
|
Matthew J. Foulston
|
Date: February 22, 2016
|
Chief Financial Officer
|
|
Signature
|
|
Capacity
|
|
|
|
|
|
/s/ Francis J. Malecha
|
|
President, Chief Executive Officer
|
|
Francis J. Malecha
|
|
and Director (Principal Executive Officer)
|
|
|
|
|
|
/s/ Matthew J. Foulston
|
|
Chief Financial Officer
|
|
Matthew J. Foulston
|
|
(Principal Financial and Accounting Officer)
|
|
|
|
|
|
/s/ David J. D’Antoni
|
|
Director
|
|
David J. D’Antoni
|
|
|
|
|
|
|
|
/s/ Eric Ford
|
|
Director
|
|
Eric Ford
|
|
|
|
|
|
|
|
/s/ Richard S. Grant
|
|
Director
|
|
Richard S. Grant
|
|
|
|
|
|
|
|
/s/ Allan R. Rothwell
|
|
Director
|
|
Allan R. Rothwell
|
|
|
|
|
|
|
|
/s/ Lori A. Walker
|
|
Director
|
|
Lori A. Walker
|
|
|
|
|
|
|
|
/s/ Paul S. Williams
|
|
Director
|
|
Paul S. Williams
|
|
|
|
|
|
|
|
/s/ Amy J. Yoder
|
|
Director
|
|
Amy J. Yoder
|
|
|
|
84
|
|
Article 1 – Definitions and Rules of Construction
|
8
|
|
Section 1.1. Definitions
|
8
|
|
Section 1.2. Rules of Construction
|
19
|
|
Article 2 – Subscription of Shares and Payment
|
19
|
|
Section 2.1. Investment Framework
|
19
|
|
Section 2.2. Equity Interest
|
21
|
|
Article 3 – Closing Consummation and Post-Closing Price Adjustment
|
21
|
|
Section 3.1. Closing
|
21
|
|
Section 3.2. Closing Obligations
|
22
|
|
Section 3.3. Actual Adjusted EBITDA and Actual Net Debt
|
23
|
|
Section 3.4. Post-Closing Adjustment
|
25
|
|
Article 4 – Representations and Warranties of the Company
|
25
|
|
Section 4.1. Organization, Power and Authority
|
25
|
|
Section 4.2. Enforceability
|
26
|
|
Section 4.3. No Violation or Breach
|
26
|
|
Section 4.4. Consents
|
26
|
|
Section 4.5. Capitalization of the Company and Subsidiaries
|
26
|
|
Section 4.6. Subsidiaries and Branches
|
27
|
|
Section 4.7. Material Contracts
|
27
|
|
Section 4.8. Compliance with Laws
|
28
|
|
Section 4.9. Labor Matters
|
29
|
|
Section 4.10. Personnel
|
30
|
|
Section 4.11. Permits
|
30
|
|
Section 4.12. Information Technology
|
31
|
|
Section 4.13. Environmental Matters
|
31
|
|
Section 4.14. Tax Matters
|
31
|
|
Section 4.15. Insurance
|
32
|
|
Section 4.16. Assets
|
32
|
|
Section 4.17. Real Property
|
32
|
|
Section 4.18. Intellectual Property
|
33
|
|
Section 4.19. Financial Statements
|
34
|
|
Section 4.20. Litigation and Investigations
|
35
|
|
Section 4.21. Brokerage Fees and Commissions
|
35
|
|
Section 4.22. No Other Representations or Warranties
|
35
|
|
Section 4.23. Solvency
|
35
|
|
Section 4.24. Central Bank Registration; Foreign Investment. Foreign Loans
|
35
|
|
Article 5 – Representations and Warranties of the Initial Shareholders
|
36
|
|
Section 5.1. Organization, Power and Authority
|
36
|
|
Section 5.2. Enforceability
|
36
|
|
Section 5.3. No Violation or Breach
|
37
|
|
Section 5.4. Consents
|
37
|
|
Section 5.5. Claims
|
37
|
|
Article 6 – Representations and Warranties of the Investor
|
37
|
|
Section 6.1. Organization, Power and Authority
|
38
|
|
Section 6.2. Enforceability
|
38
|
|
Section 6.3. No Violation or Breach
|
38
|
|
Section 6.4. Consents
|
38
|
|
Section 6.5. Claims
|
38
|
|
Section 6.6. Solvency
|
38
|
|
Section 6.7. Effect of Due Diligence and Related Matters
|
39
|
|
Article 7 – Covenants
|
39
|
|
Section 7.1. Confidentiality
|
39
|
|
Section 7.2. Public Announcements
|
40
|
|
Section 7.3. Further Assurances
|
40
|
|
Section 7.4. Hedge
|
41
|
|
Section 7.5. Jacareí Lease Agreement
|
41
|
|
Section 7.6. Assumption of Credit Risk under Credito Rural
|
41
|
|
Article 8 – Indemnification
|
41
|
|
Section 8.1. Indemnification by the Company
|
41
|
|
Section 8.2. Indemnification by Investor
|
43
|
|
Section 8.3. Term of Indemnification
|
43
|
|
Section 8.4. Indemnifiable Loss
|
43
|
|
Section 8.5. Deductible and Maximum Amount of Indemnification
|
43
|
|
Section 8.6. Insurance; Tax Benefits; Subrogation
|
44
|
|
Section 8.7. Memorandum Account.
|
44
|
|
Section 8.8. Exclusive Remedy
|
44
|
|
Section 8.9. Losses Resulting from a Direct Claim
|
44
|
|
Section 8.10. Third-Party Claim against an Indemnified Party
|
45
|
|
Section 8.11. Third
|
46
|
|
Section 8.12. Maturity of an Indemnifiable Loss
|
48
|
|
Section 8.13. Payment of an Indemnifiable Loss to an Investor Indemnified Party
|
48
|
|
Section 8.14. Payment of
|
48
|
|
Section 8.15. Obligation to Mitigate Risks of Loss
|
49
|
|
Article 9 – Exit Put Option and Exit Call Option
|
49
|
|
Section 9.1. Exit Put Option and Exit Call Option.
|
49
|
|
Section 9.2. Exit Option Price
|
51
|
|
Section 9.3. Regulatory Approvals
|
52
|
|
Section 9.4. Exit Closing Date
|
52
|
|
Section 9.5. Escrow Deposit
|
54
|
|
Article 10 – Non Compete
|
55
|
|
Section 10.1. Non-compete
|
55
|
|
Article 11 – Indemnification after Exit Put Option or Exit Call Option
|
55
|
|
Section 11.1. Indemnification After Exit Put Option or Exit Call Option.
|
56
|
|
Section 11.2. Second Deductible
|
57
|
|
Section 11.3. New Maximum Amount of Indemnification
|
57
|
|
Section 11.4. Selling Shareholders Obligations
|
57
|
|
Section 11.5. Escrow Account
|
57
|
|
Section 11.6. Defense
|
57
|
|
Article 12 – Termination
|
58
|
|
Section 12.1. Termination
|
58
|
|
Section 12.2. Effect of Termination
|
58
|
|
Article 13 – Miscellaneous
|
58
|
|
Section 13.1. Governing Law
|
58
|
|
Section 13.2. Arbitration
|
58
|
|
Section 13.3. Entire Agreement
|
61
|
|
Section 13.4. Notices
|
61
|
|
Section 13.5. Parties in Interest; Assignment
|
63
|
|
Section 13.6. Amendments and Waivers.
|
63
|
|
Section 13.7. Agreement for the Parties’ Benefit Only; Non-Recourse.
|
64
|
|
Section 13.8. Specific Performance
|
64
|
|
Section 13.9. Severability
|
64
|
|
Section 13.10. Irreversible and Irrevocable Nature
|
64
|
|
Section 13.11. Taxes, Fees and Expenses
|
64
|
|
Section 13.12. Counterparts; Third Party Beneficiaries
|
65
|
|
Section 13.13. Intervening-Consenting Party
|
65
|
|
Section 13.14. Authorization to initialize
|
65
|
|
(i)
|
If to Peach and/or Amber International
:
|
(ii)
|
If to Gerhard and/or Tantalun
:
|
(iii)
|
If to Cau:
|
(iv)
|
If to Marcelino:
|
(v)
|
If to TRB Industries:
|
/s/
Mrs. Beatriz Kopschitz Xavier Bastos
|
/s/
Mrs. Beatriz Kopschitz Xavier Bastos
|
/s/
Mrs. Beatriz Kopschitz Xavier Bastos
|
/s/
Gerhard Walter Schultz
|
/s/
João Marcelino Ramos
|
/s/
Paulo César Cau
|
/s/
Gerhard Walter Schultz
|
/s/
Marcelo Nastromagario
|
/s/
Gerhard Walter Schultz
|
/s/
João Marcelino Ramos
|
/s/
Daniel Lins Mattos
|
/s/
Lucas Henrique C. M. Mussi
|
ARTICLE 1 – DEFINITIONS AND RULES OF CONSTRUCTION
|
8
|
Section 1.1. Definitions
|
8
|
Section 1.2. Rules of Construction
|
13
|
ARTICLE 2 – PURCHASE AND SALE, PURCHASE PRICE AND PAYMENT
|
14
|
Section 2.1. Purchase and Sale
|
14
|
Section 2.2. Purchase Price
|
14
|
Section 2.3. Payment
|
15
|
ARTICLE 3 – CLOSING OBLIGATIONS AND POST-CLOSING ADJUSTMENT
|
16
|
Section 3.1. Closing
|
16
|
Section 3.2. Closing Obligations
|
16
|
Section 3.3. Transfer of the Purchased Shares
|
17
|
Section 3.4. Actual Adjusted EBITDA and Actual Net Debt
|
17
|
Section 3.5. Post-Closing Adjustment
|
18
|
ARTICLE 4 – REPRESENTATIONS AND WARRANTIES OF THE SELLING SHAREHOLDERS AND THE COMPANY
|
18
|
Section 4.1. Organization, Power and Authority
|
18
|
Section 4.2. Enforceability
|
19
|
Section 4.3. No Violation or Breach
|
19
|
Section 4.4. Consents
|
19
|
Section 4.5. Claims
|
19
|
Section 4.6. Ownership of Purchased Shares
|
20
|
ARTICLE 5 – REPRESENTATIONS AND WARRANTIES OF COMPASS
|
20
|
Section 5.1. Organization, Power and Authority
|
20
|
Section 5.2. Enforceability
|
20
|
Section 5.3. No Violation or Breach
|
20
|
Section 5.4. Consents
|
21
|
Section 5.5. Claims
|
21
|
ARTICLE 6 – COVENANTS
|
22
|
Section 6.1. Confidentiality
|
22
|
Section 6.2. Public Announcements
|
23
|
Section 6.3. Further Assurances
|
23
|
Section 6.4. Indemnification
|
23
|
ARTICLE 7 – TERMINATION
|
24
|
Section 7.1. Termination
|
24
|
Section 7.2. Effect of Termination
|
24
|
ARTICLE 8 – MISCELLANEOUS
|
25
|
Section 8.1. Governing Law
|
25
|
Section 8.2. Arbitration
|
25
|
Section 8.3. Entire Agreement
|
28
|
Section 8.4. Notices
|
28
|
Section 8.5. Parties in Interest; Assignment
|
31
|
Section 8.6. Amendments and Waivers.
|
31
|
Section 8.7. Agreement for the Parties’ Benefit Only; Non-Recourse.
|
32
|
Section 8.8. Specific Performance
|
32
|
Section 8.9. Severability
|
32
|
Section 8.10. Irreversible
|
33
|
Section 8.11. Taxes, Fees and Expenses
|
33
|
Section 8.12. Counterparts; Third Party Beneficiaries
|
33
|
Section 8.13. Intervening Parties
|
33
|
Selling Shareholders
|
Number of Ordinary Shares
|
% vote
|
% economic
|
Peach
|
18,189,416
|
38.65%
|
38.65%
|
Gerhard
|
16,045,687
|
34.09%
|
34.09%
|
Marcelino
|
729,244
|
1.55%
|
1.55%
|
Cau
|
470,677
|
1.00%
|
1.00%
|
TRB Industries
|
298,980
|
0.64%
|
0.64%
|
Total
|
35,734,004
|
75.92%
|
75.92%
|
Selling Shareholders
|
Number of Shares to be sold
|
% of Sold Shares
|
Purchase Value
(in R$)
|
Peach
|
1,743,979
|
51.70%
|
40,002,354.03
|
Gerhard
|
1,521,883
|
45.12%
|
34,908,047.95
|
Marcelino
|
52,264
|
1.55%
|
1,198,800.58
|
Cau
|
33,732
|
1.00%
|
773,724.57
|
TRB Industries
|
21,427
|
0.64%
|
491,479.79
|
Total
|
3,373,285
|
100.00%
|
77,374,406.92
|
(e)
|
the Company shall execute the relevant annotations with Itaú Unibanco in its capacity of book-keeping agent (
escriturador
) in charge of the registration of the Company’s shares, reflecting the ownership of the Purchased Shares by Compass.
|
(i)
|
If to Peach
:
|
(ii)
|
If to Gerhard
:
|
(iii)
|
If to Cau:
|
(iv)
|
If to Marcelino:
|
(v)
|
If to TRB Industries:
|
/s/
Mrs. Beatriz Kopschitz Xavier Bastos
|
/s/
Paulo César Cau
|
/s/
João Marcelino Ramos
|
/s/
Mrs. Beatriz Kopschitz Xavier Bastos
|
/s/
Gerhard Walter Schultz
|
/s/
Marcelo Nastromagario
|
/s/
Gerhard Walter Schultz
|
/s/
João Marcelino Ramos
|
/s/
Daniel Lins Mattos
|
/s/
Lucas Henrique C. M. Mussi
|
1.
|
Annual Retainer
- Each non-employee director will receive from the Company an annual retainer of $160,000 per year:
|
a)
|
$75,000 of the annual retainer amount per year is the cash retainer and may be deferred into the Directors’ Deferred Compensation Plan at the election of the director; and
|
b)
|
$85,000 of the annual retainer amount per year must be deferred into the Directors’ Deferred Compensation Plan until ownership levels are met, and then may be deferred or taken in shares of stock of the Company. Deferred amounts are converted into units equivalent to the value of the Company’s common stock and accumulated deferred fees are distributed in common stock.
|
2.
|
Ownership Levels
- Each non-employee member of the Board of Directors is required to obtain and to maintain ownership in Company stock (or its equivalent) equal to five times the annual cash retainer, which amount is to be achieved within five years of joining the Board.
|
3.
|
Committee Service Fee
- Each non-employee director will receive from the Company an annual fee for serving on each of the following committees, as follows:
|
Audit Committee
|
$
|
10,000
|
|
Compensation Committee
|
$
|
7,500
|
|
Nominating/Corporate Governance Committee
|
$
|
5,000
|
|
Environmental, Health & Safety Committee
|
$
|
5,000
|
|
4.
|
Committee Chair Fee
. Each non-employee director who serves as a committee chair for 2016 will receive from the Company the following annual fee, as follows:
|
Audit Committee
|
$
|
22,500
|
|
Compensation Committee
|
$
|
15,000
|
|
Nominating/Corporate Governance Committee
|
$
|
12,500
|
|
Environmental, Health & Safety Committee
|
$
|
12,500
|
|
5.
|
Lead Independent Director
. The Lead Independent Director will be paid an annual fee in the amount of $20,000 per year.
|
6.
|
Cash v. Deferral Election
. Non-employee directors may elect to receive fees paid for serving on a committee, as a committee chair, and as Lead Independent Director in cash or may elect to defer such into the Company’s Directors’ Deferred Compensation Plan.
|
EXECUTION VERSION
|
Exhibit 10.57
|
Scheduled Repayment Date
|
Tranche D Term Loan Amount
|
Tranche E Term Loan Amount
|
June 30, 2012
|
$967,500.00
|
--
|
September 30, 2012
|
$967,500.00
|
--
|
December 31, 2012
|
$967,500.00
|
--
|
March 31, 2013
|
$967,500.00
|
--
|
June 30, 2013
|
$967,500.00
|
--
|
September 30, 2013
|
$967,500.00
|
--
|
December 31, 2013
|
$967,500.00
|
--
|
March 31, 2014
|
$967,500.00
|
--
|
June 30, 2014
|
$967,500.00
|
--
|
September 30, 2014
|
$967,500.00
|
--
|
December 31, 2014
|
$967,500.00
|
--
|
March 31, 2015
|
$967,500.00
|
--
|
June 30, 2015
|
$967,500.00
|
--
|
September 30, 2015
|
$967,500.00
|
--
|
December 31, 2015
|
$967,500.00
|
--
|
March 31, 2016
|
$967,500.00
|
$250,000.00
|
June 30, 2016
|
$967,500.00
|
$250,000.00
|
September 30, 2016
|
$967,500.00
|
$250,000.00
|
December 31, 2016
|
$967,500.00
|
$250,000.00
|
March 31, 2017
|
$967,500.00
|
$250,000.00
|
Tranche D Term Loan and Tranche E Term Loan Maturity Date
|
$367,650,000.00
|
$98,750,000.00”
|
COMPASS MINERALS INTERNATIONAL, INC.,
as US Borrower,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer
|
COMPASS MINERALS CANADA CORP. (f/k/a SIFTO CANADA CORP.), as Canadian Borrower,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer
|
COMPASS MINERALS UK LIMITED (f/k/a SALT UNION LIMITED),
as UK Borrower,
|
|
by
|
/s/ Caroline McAlindon
|
|
Name: Caroline McAlindon
|
|
Title: Director
|
GREAT SALT LAKE HOLDINGS, LLC,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer
|
COMPASS MINERALS OGDEN INC. (f/k/a GREAT SALT LAKE MINERALS CORPORATION),
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer
|
COMPASS MINERALS LOUISIANA INC. (f/k/a CAREY SALT COMPANY),
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer
|
DOVE CREEK GRAZING, LLC,
|
|
by
|
/s/ Keith Espelien
|
|
Name: Keith Espelien
|
|
Title: Manager
|
GSL CORPORATION,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer & Assistant Secretary
|
NAMSCO INC.,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer & Assistant Secretary
|
COMPASS MINERALS AMERICA INC. (f/k/a NORTH AMERICAN SALT COMPANY),
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer
|
CLYMAN BAY RESOURCES, INC.,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer & Assistant Secretary
|
COMPASS MINERALS USA INC.,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer & Assistant Secretary
|
WOLF TRAX HOLDINGS INC.,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer & Assistant Secretary
|
WOLF TRAX USA INC.,
|
|
by
|
/s/ James D. Standen
|
|
Name: James D. Standen
|
|
Title: Treasurer & Assistant Secretary
|
JPMORGAN CHASE BANK, N.A.,
individually as an Incremental Lender and as the Administrative Agent,
|
|
by
|
/s/ Peter S. Predun
|
|
Name: Peter S. Predun
|
|
Title: Executive Director
|
BANK OF AMERICA, N.A.,
as an Incremental Lender,
|
|
by
|
/s/ Dianne M. Smith
|
|
Name: Dianne M. Smith
|
|
Title: Senior Vice President
|
THE BANK OF NOVA SCOTIA,
as an Incremental Lender,
|
|
by
|
/s/ Paula J. Czach
|
|
Name: Paula J. Czach
|
|
Title: Managing Director
|
WELLS FARGO BANK, NA,
as an Incremental Lender,
|
|
by
|
/s/ Damon Bodenhamer
|
|
Name: Damon Bodenhamer
|
|
Title: Vice President
|
Name
|
Tranche E Term Commitment
|
|
|
JPMorgan Chase Bank, N.A.
|
|
$25,000,000
|
|
Bank of America, N.A.
|
|
$25,000,000
|
|
The Bank of Nova Scotia
|
|
$25,000,000
|
|
Wells Fargo Bank, N.A.
|
|
$25,000,000
|
|
Total
|
|
$100,000,000
|
|
|
|
|
|
|
|
||||||
Compass Minerals International, Inc.
|
|||||||||||
Computation of Ratios of Earnings to Fixed Charges
|
|||||||||||
(in millions)
|
|||||||||||
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Year ended December 31,
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Earnings:
|
|
|
|
|
|
||||||
Net earnings before income taxes
|
$
|
159.2
|
|
|
$
|
291.8
|
|
|
$
|
174.1
|
|
Less: capitalized interest
|
(1.5
|
)
|
|
(0.3
|
)
|
|
(0.6
|
)
|
|||
Plus: fixed charges
|
26.5
|
|
|
23.3
|
|
|
21.1
|
|
|||
|
$
|
184.2
|
|
|
$
|
314.8
|
|
|
$
|
194.6
|
|
|
|
|
|
|
|
||||||
Fixed Charges:
|
|
|
|
|
|
||||||
Interest charges
|
$
|
21.5
|
|
|
$
|
20.1
|
|
|
$
|
17.9
|
|
Capitalized interest
|
1.5
|
|
|
0.3
|
|
|
0.6
|
|
|||
Plus interest factor in operating rent expense
|
3.5
|
|
|
2.9
|
|
|
2.6
|
|
|||
|
$
|
26.5
|
|
|
$
|
23.3
|
|
|
$
|
21.1
|
|
|
|
|
|
|
|
||||||
Ratio of earnings to fixed charges
|
6.95x
|
|
|
13.51x
|
|
|
9.22x
|
|
Company Name
|
Jurisdiction of Incorporation
|
Clyman Bay Resources, Inc.
|
Delaware, U.S.
|
CMP Capital, Inc.
|
Delaware, U.S.
|
Compass Minerals America Inc.
|
Delaware, U.S.
|
Compass Minerals Louisiana Inc.
|
Delaware, U.S.
|
Compass Minerals Odgen Inc.
|
Delaware, U.S.
|
Compass Minerals USA Inc.
|
Delaware, U.S.
|
Curlew Valley Farms, LLC
|
Utah, U.S.
|
Dove Creek Grazing, LLC
|
Utah, U.S.
|
Great Salt Lake Holdings, LLC
|
Delaware, U.S.
|
GSL Corporation
|
Delaware, U.S.
|
NAMSCO Inc.
|
Delaware, U.S.
|
Wolf Trax USA Inc.
|
Delaware, U.S.
|
Wolf Trax Holdings Inc.
|
Delaware, U.S.
|
CMI Canada Holdings Company
|
Nova Scotia, Canada
|
CMI Nova Scotia Company
|
Nova Scotia, Canada
|
CMP Canada Inc.
|
Nova Scotia, Canada
|
Compass Canada Limited Partnership
|
Ontario, Canada
|
Compass Canada Potash Holdings Inc.
|
Saskatchewan, Canada
|
Compass Minerals Canada Corp.
|
Nova Scotia, Canada
|
Compass Minerals International Limited Partnership
|
Ontario, Canada
|
Compass Minerals Manitoba Inc.
|
Manitoba, Canada
|
Compass Minerals Nova Scotia Company
|
Nova Scotia, Canada
|
Compass Minerals Wynyard Inc.
|
Saskatchewan, Canada
|
Compass Resources Canada Company
|
Nova Scotia, Canada
|
NASC Nova Scotia Company
|
Nova Scotia, Canada
|
Compass Minerals (Europe) Limited
|
England and Wales
|
Compass Minerals Storage & Archives Limited
|
England and Wales
|
Compass Minerals UK Holdings Limited
|
England and Wales
|
Compass Minerals UK Limited
|
England and Wales
|
DeepStore Holdings Limited
|
England and Wales
|
DeepStore Limited
|
England and Wales
|
Salt Union Limited
|
England and Wales
|
Wolf Trax Europe Limited
|
England and Wales
|
Compass Cayman Holdings Ltd.
|
Cayman Islands
|
Compass South American Salt Holdings Ltd.
|
Cayman Islands
|
Compass Minerals Chile Limitada
|
Chile
|
Compass Minerals do Brasil Ltda.
|
Brazil
|
Compass Minerals South Africa Pty Ltd.
|
South Africa
|
|
|
|
|
February 22, 2016
|
|
|
/s/ Ernst & Young LLP
|
Kansas City, Missouri
|
|
|
|
|
1.
|
I have reviewed this annual report on Form 10-K of Compass Minerals International, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 22, 2016
|
/s/ Francis J. Malecha
|
|
|
Francis J. Malecha
|
|
|
President and Chief Executive Officer
|
|
|
1.
|
I have reviewed this annual report on Form 10-K of Compass Minerals International, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 22, 2016
|
/s/ Matthew J. Foulston
|
|
|
Matthew J. Foulston
|
|
|
Chief Financial Officer
|
|
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
|
|
|
February 22, 2016
|
/s/ Francis J. Malecha
|
|
|
Francis J. Malecha
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
/s/ Matthew J. Foulston
|
|
|
Matthew J. Foulston
|
|
|
Chief Financial Officer
|
|
|