|
Delaware
|
36-3972986
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification Number)
|
Large accelerated filer
þ
|
Accelerated filer
¨
|
Non-accelerated filer
¨
|
Smaller reporting company
¨
|
|
|
|
Emerging growth company
¨
|
|
|
|
Page
|
|
|
|
|
PART I. FINANCIAL INFORMATION
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
|
|
|
|
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|
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|
|
PART II. OTHER INFORMATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
||||
|
March 31,
2018 |
|
December 31,
2017 |
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
44.5
|
|
|
$
|
36.6
|
|
Receivables, less allowance for doubtful accounts of $10.8 in 2018 and $10.9 in 2017
|
275.0
|
|
|
344.5
|
|
||
Inventories
|
217.2
|
|
|
289.9
|
|
||
Other
|
59.8
|
|
|
66.5
|
|
||
Total current assets
|
596.5
|
|
|
737.5
|
|
||
Property, plant and equipment, net
|
1,124.8
|
|
|
1,138.1
|
|
||
Intangible assets, net
|
138.0
|
|
|
143.6
|
|
||
Goodwill
|
402.8
|
|
|
405.0
|
|
||
Investment in equity method investee
|
24.6
|
|
|
24.6
|
|
||
Other
|
126.1
|
|
|
122.2
|
|
||
Total assets
|
$
|
2,412.8
|
|
|
$
|
2,571.0
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Current portion of long-term debt
|
$
|
32.3
|
|
|
$
|
32.1
|
|
Accounts payable
|
109.0
|
|
|
123.5
|
|
||
Accrued expenses
|
64.4
|
|
|
54.4
|
|
||
Accrued salaries and wages
|
18.6
|
|
|
23.9
|
|
||
Income taxes payable
|
21.1
|
|
|
25.9
|
|
||
Accrued interest
|
5.7
|
|
|
8.2
|
|
||
Total current liabilities
|
251.1
|
|
|
268.0
|
|
||
Long-term debt, net of current portion
|
1,218.2
|
|
|
1,330.4
|
|
||
Deferred income taxes, net
|
125.0
|
|
|
127.0
|
|
||
Other noncurrent liabilities
|
149.4
|
|
|
151.0
|
|
||
Commitments and contingencies (
Note 9
)
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock: $0.01 par value, 200,000,000 authorized shares; 35,367,264 issued shares
|
0.4
|
|
|
0.4
|
|
||
Additional paid-in capital
|
103.7
|
|
|
102.5
|
|
||
Treasury stock, at cost — 1,517,797 shares at March 31, 2018 and 1,539,763 shares at December 31, 2017
|
(2.9
|
)
|
|
(2.9
|
)
|
||
Retained earnings
|
660.8
|
|
|
672.5
|
|
||
Accumulated other comprehensive loss
|
(92.9
|
)
|
|
(77.9
|
)
|
||
Total stockholders’ equity
|
669.1
|
|
|
694.6
|
|
||
Total liabilities and stockholders’ equity
|
$
|
2,412.8
|
|
|
$
|
2,571.0
|
|
|
Three Months Ended
March 31, |
||||||
|
2018
|
|
2017
|
||||
Sales
|
$
|
437.9
|
|
|
$
|
387.8
|
|
Shipping and handling cost
|
120.1
|
|
|
93.7
|
|
||
Product cost
|
252.4
|
|
|
212.5
|
|
||
Gross profit
|
65.4
|
|
|
81.6
|
|
||
Selling, general and administrative expenses
|
38.8
|
|
|
40.2
|
|
||
Operating earnings
|
26.6
|
|
|
41.4
|
|
||
|
|
|
|
||||
Other expense (income):
|
|
|
|
||||
Interest expense
|
13.7
|
|
|
13.7
|
|
||
Net loss in equity investee
|
0.1
|
|
|
—
|
|
||
Other, net
|
(4.2
|
)
|
|
(0.1
|
)
|
||
Earnings before income taxes
|
17.0
|
|
|
27.8
|
|
||
Income tax expense
|
4.4
|
|
|
6.3
|
|
||
Net earnings
|
$
|
12.6
|
|
|
$
|
21.5
|
|
|
|
|
|
||||
Basic net earnings per common share
|
$
|
0.37
|
|
|
$
|
0.63
|
|
Diluted net earnings per common share
|
$
|
0.37
|
|
|
$
|
0.63
|
|
|
|
|
|
||||
Weighted-average common shares outstanding (in thousands):
|
|
|
|
||||
Basic
|
33,836
|
|
|
33,802
|
|
||
Diluted
|
33,836
|
|
|
33,803
|
|
||
|
|
|
|
||||
Cash dividends per share
|
$
|
0.72
|
|
|
$
|
0.72
|
|
|
Three Months Ended
March 31, |
||||||
|
2018
|
|
2017
|
||||
Net earnings
|
$
|
12.6
|
|
|
$
|
21.5
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||
Unrealized gain from change in pension obligations, net of tax of $0.0 in both 2018 and 2017
|
0.1
|
|
|
0.1
|
|
||
Unrealized loss on cash flow hedges, net of tax of $0.3 in both 2018 and 2017
|
(0.5
|
)
|
|
(0.5
|
)
|
||
Cumulative translation adjustment
|
(14.4
|
)
|
|
14.8
|
|
||
Comprehensive (loss) income
|
$
|
(2.2
|
)
|
|
$
|
35.9
|
|
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Treasury
Stock
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Total
|
||||||||||||
Balance, December 31, 2017
|
$
|
0.4
|
|
|
$
|
102.5
|
|
|
$
|
(2.9
|
)
|
|
$
|
672.5
|
|
|
$
|
(77.9
|
)
|
|
$
|
694.6
|
|
Comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
12.6
|
|
|
(14.8
|
)
|
|
(2.2
|
)
|
||||||
Stranded tax effect from tax reform
|
|
|
|
|
|
|
|
|
|
0.2
|
|
|
(0.2
|
)
|
|
—
|
|
||||||
Dividends on common stock
|
|
|
|
0.1
|
|
|
|
|
|
(24.5
|
)
|
|
|
|
|
(24.4
|
)
|
||||||
Stock-based compensation
|
|
|
|
1.1
|
|
|
|
|
|
|
|
|
|
|
|
1.1
|
|
||||||
Balance, March 31, 2018
|
$
|
0.4
|
|
|
$
|
103.7
|
|
|
$
|
(2.9
|
)
|
|
$
|
660.8
|
|
|
$
|
(92.9
|
)
|
|
$
|
669.1
|
|
|
Three Months Ended
March 31, |
||||||
|
2018
|
|
2017
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net earnings
|
$
|
12.6
|
|
|
$
|
21.5
|
|
Adjustments to reconcile net earnings to net cash flows provided by operating activities:
|
|
|
|
||||
Depreciation, depletion and amortization
|
34.3
|
|
|
28.4
|
|
||
Finance fee amortization
|
0.6
|
|
|
0.6
|
|
||
Stock-based compensation
|
1.1
|
|
|
1.3
|
|
||
Deferred income taxes
|
0.3
|
|
|
(1.2
|
)
|
||
Gain on settlement of acquisition-related contingent consideration
|
—
|
|
|
(1.9
|
)
|
||
Other, net
|
0.4
|
|
|
(2.6
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables
|
68.9
|
|
|
97.9
|
|
||
Inventories
|
71.3
|
|
|
44.4
|
|
||
Other assets
|
0.5
|
|
|
(2.8
|
)
|
||
Accounts payable and accrued expenses
|
(17.8
|
)
|
|
(61.0
|
)
|
||
Other liabilities
|
0.8
|
|
|
0.6
|
|
||
Net cash provided by operating activities
|
173.0
|
|
|
125.2
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(23.0
|
)
|
|
(21.0
|
)
|
||
Other, net
|
(0.6
|
)
|
|
(1.3
|
)
|
||
Net cash used in investing activities
|
(23.6
|
)
|
|
(22.3
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from revolving credit facility borrowings
|
63.8
|
|
|
18.3
|
|
||
Principal payments on revolving credit facility borrowings
|
(186.2
|
)
|
|
(101.7
|
)
|
||
Proceeds from issuance of long-term debt
|
16.0
|
|
|
10.9
|
|
||
Principal payments on long-term debt
|
(5.6
|
)
|
|
(21.3
|
)
|
||
Acquisition-related contingent consideration payment
|
—
|
|
|
(14.7
|
)
|
||
Dividends paid
|
(24.5
|
)
|
|
(24.4
|
)
|
||
Deferred financing costs
|
(0.3
|
)
|
|
—
|
|
||
Proceeds received from stock option exercises
|
—
|
|
|
0.2
|
|
||
Other, net
|
—
|
|
|
0.7
|
|
||
Net cash used in financing activities
|
(136.8
|
)
|
|
(132.0
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(4.7
|
)
|
|
0.6
|
|
||
Net change in cash and cash equivalents
|
7.9
|
|
|
(28.5
|
)
|
||
Cash and cash equivalents, beginning of the year
|
36.6
|
|
|
77.4
|
|
||
Cash and cash equivalents, end of period
|
$
|
44.5
|
|
|
$
|
48.9
|
|
Supplemental cash flow information:
|
|
|
|
|
|
||
Interest paid, net of amounts capitalized
|
$
|
14.7
|
|
|
$
|
14.4
|
|
Income taxes paid, net of refunds
|
$
|
5.0
|
|
|
$
|
12.1
|
|
1.
|
Accounting Policies and Basis of Presentation:
|
|
3.
|
Acquisition:
|
Fair Value of Consideration Transferred (in millions)
|
October 3, 2016
|
|
|
Cash paid at closing
|
$
|
317.1
|
|
Additional cash due at closing
|
20.6
|
|
|
Fair value of contingent consideration
|
31.4
|
|
|
Fair value of 35% equity investment
|
178.7
|
|
|
Total
|
$
|
547.8
|
|
Recognized amounts of identifiable assets acquired and liabilities assumed (in millions):
|
Purchase Price Allocation
|
||
Cash and cash equivalents
|
$
|
73.8
|
|
Accounts receivable
|
89.4
|
|
|
Inventories
|
77.1
|
|
|
Other current assets
|
13.7
|
|
|
Property, plant and equipment
|
189.4
|
|
|
Intangible assets
|
81.2
|
|
|
Investment in equity method investee
|
24.5
|
|
|
Other noncurrent assets
|
6.9
|
|
|
Accounts payable
|
(27.1
|
)
|
|
Accrued expenses
|
(40.3
|
)
|
|
Current portion of long-term debt
|
(129.6
|
)
|
|
Other current liabilities
|
(14.0
|
)
|
|
Long-term debt, net of current portion
|
(62.0
|
)
|
|
Deferred income taxes, net
|
(66.0
|
)
|
|
Other noncurrent liabilities
|
(21.9
|
)
|
|
Total identifiable net assets
|
195.1
|
|
|
Goodwill
|
352.7
|
|
|
Total fair value of business combination
|
$
|
547.8
|
|
|
Estimated Fair Value
(in millions)
|
Weighted-Average Amortization Period
(in years)
|
||
Trade names
|
$
|
36.9
|
|
11.0
|
Developed technology
|
37.5
|
|
5.3
|
|
Customer relationships
|
6.8
|
|
13.5
|
|
Total identifiable intangible assets
|
$
|
81.2
|
|
8.6
|
4.
|
Inventories:
|
|
March 31,
2018 |
|
December 31,
2017 |
||||
Finished goods
|
$
|
130.0
|
|
|
$
|
208.4
|
|
Raw materials and supplies
|
87.2
|
|
|
81.5
|
|
||
Total inventories
|
$
|
217.2
|
|
|
$
|
289.9
|
|
5.
|
Property, Plant and Equipment, Net:
|
|
March 31,
2018 |
|
December 31,
2017 |
||||
Land, buildings and structures, and leasehold improvements
|
$
|
560.7
|
|
|
$
|
552.5
|
|
Machinery and equipment
|
995.9
|
|
|
942.3
|
|
||
Office furniture and equipment
|
53.5
|
|
|
53.1
|
|
||
Mineral interests
|
172.3
|
|
|
173.1
|
|
||
Construction in progress
|
143.1
|
|
|
213.4
|
|
||
|
1,925.5
|
|
|
1,934.4
|
|
||
Less accumulated depreciation and depletion
|
(800.7
|
)
|
|
(796.3
|
)
|
||
Property, plant and equipment, net
|
$
|
1,124.8
|
|
|
$
|
1,138.1
|
|
6.
|
Goodwill and Intangible Assets, Net:
|
7.
|
Income Taxes:
|
8.
|
Long-term Debt:
|
|
March 31,
2018 |
|
December 31,
2017 |
||||
Term Loans due July 2021
|
$
|
835.2
|
|
|
$
|
837.4
|
|
Revolving Credit Facility due July 2021
|
46.5
|
|
|
168.9
|
|
||
4.875% Senior Notes due July 2024
|
250.0
|
|
|
250.0
|
|
||
Rabobank Loan due November 2019
|
21.1
|
|
|
21.1
|
|
||
Banco Itaú Loans due May 2019 to April 2020
|
1.7
|
|
|
1.9
|
|
||
Financiadora de Estudos e Projetos Loan due November 2023
|
12.5
|
|
|
13.1
|
|
||
Banco do Brasil Loan due February 2018
|
—
|
|
|
0.2
|
|
||
Banco do Brasil Loan due May 2018 and September 2018
|
0.6
|
|
|
—
|
|
||
Banco Santander Loan due September 2019
|
19.5
|
|
|
19.6
|
|
||
Banco Santander Loan due November 2019
|
24.1
|
|
|
24.1
|
|
||
Banco Itaú Loan due March 2019
|
10.0
|
|
|
12.4
|
|
||
3.7% Banco Itaú Loan due March 2020
|
15.4
|
|
|
—
|
|
||
Banco Scotiabank Loan due September 2019
|
20.5
|
|
|
20.5
|
|
||
|
1,257.1
|
|
|
1,369.2
|
|
||
Less unamortized debt issuance costs
|
(6.6
|
)
|
|
(6.7
|
)
|
||
Total debt
|
1,250.5
|
|
|
1,362.5
|
|
||
Less current portion
|
(32.3
|
)
|
|
(32.1
|
)
|
||
Long-term debt
|
$
|
1,218.2
|
|
|
$
|
1,330.4
|
|
9.
|
Commitments and Contingencies:
|
10.
|
Operating Segments:
|
Three Months Ended March 31, 2018
|
|
Salt
|
|
Plant
Nutrition North America
|
|
Plant
Nutrition South America |
|
Corporate
& Other
(a)
|
|
Total
|
||||||||||
Sales to external customers
|
|
$
|
315.9
|
|
|
$
|
52.9
|
|
|
$
|
66.3
|
|
|
$
|
2.8
|
|
|
$
|
437.9
|
|
Intersegment sales
|
|
—
|
|
|
0.2
|
|
|
0.4
|
|
|
(0.6
|
)
|
|
—
|
|
|||||
Shipping and handling cost
|
|
109.5
|
|
|
6.4
|
|
|
4.2
|
|
|
—
|
|
|
120.1
|
|
|||||
Operating earnings (loss)
|
|
34.1
|
|
|
4.9
|
|
|
0.8
|
|
|
(13.2
|
)
|
|
26.6
|
|
|||||
Depreciation, depletion and amortization
|
|
14.7
|
|
|
11.3
|
|
|
5.9
|
|
|
2.4
|
|
|
34.3
|
|
|||||
Total assets (as of end of period)
|
|
885.7
|
|
|
580.0
|
|
|
816.8
|
|
|
130.3
|
|
|
2,412.8
|
|
Three Months Ended March 31, 2017
|
|
Salt
|
|
Plant
Nutrition North America
|
|
Plant
Nutrition South America |
|
Corporate
& Other
(a)
|
|
Total
|
||||||||||
Sales to external customers
|
|
$
|
274.8
|
|
|
$
|
49.2
|
|
|
$
|
61.3
|
|
|
$
|
2.5
|
|
|
$
|
387.8
|
|
Intersegment sales
|
|
—
|
|
|
0.9
|
|
|
—
|
|
|
(0.9
|
)
|
|
—
|
|
|||||
Shipping and handling cost
|
|
83.0
|
|
|
6.7
|
|
|
4.0
|
|
|
—
|
|
|
93.7
|
|
|||||
Operating earnings (loss)
|
|
45.4
|
|
|
7.6
|
|
|
1.8
|
|
|
(13.4
|
)
|
|
41.4
|
|
|||||
Depreciation, depletion and amortization
|
|
12.9
|
|
|
8.9
|
|
|
5.3
|
|
|
1.3
|
|
|
28.4
|
|
|||||
Total assets (as of end of period)
|
|
854.4
|
|
|
583.4
|
|
|
834.7
|
|
|
50.8
|
|
|
2,323.3
|
|
Three Months Ended March 31, 2018
|
|
Salt
|
|
Plant
Nutrition North America |
|
Plant
Nutrition South America |
|
Corporate
& Other (a) |
|
Total
|
||||||||||
Highway Deicing Salt
|
|
$
|
235.4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
235.4
|
|
Consumer & Industrial Salt
|
|
80.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80.5
|
|
|||||
SOP and Specialty Plant Nutrients
|
|
—
|
|
|
53.1
|
|
|
39.9
|
|
|
—
|
|
|
93.0
|
|
|||||
Industrial Chemicals
|
|
—
|
|
|
—
|
|
|
26.8
|
|
|
—
|
|
|
26.8
|
|
|||||
Eliminations & Other
|
|
—
|
|
|
(0.2
|
)
|
|
(0.4
|
)
|
|
2.8
|
|
|
2.2
|
|
|||||
Sales to external customers
|
|
$
|
315.9
|
|
|
$
|
52.9
|
|
|
$
|
66.3
|
|
|
$
|
2.8
|
|
|
$
|
437.9
|
|
(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, legal and finance functions.
|
Revenue
|
|
Three Months Ended
March 31, 2018 |
||
United States
(a)
|
|
$
|
242.2
|
|
Canada
|
|
90.8
|
|
|
Brazil
|
|
65.6
|
|
|
United Kingdom
|
|
36.7
|
|
|
Other
|
|
2.6
|
|
|
Total Revenue
|
|
$
|
437.9
|
|
(a) United States sales exclude product sold to foreign customers at U.S. ports.
|
|
|
11.
|
Stockholders’ Equity and Equity Instruments:
|
|
|
|
|
Stock Options
|
|
RSUs
|
|
PSUs
(a)
|
|||||||||||||||
|
|
Number
|
|
Weighted-average
exercise price
|
|
Number
|
|
Weighted-average
fair value
|
|
Number
|
|
Weighted-average
fair value
|
|||||||||
Outstanding at December 31, 2017
|
|
562,877
|
|
|
$
|
75.89
|
|
|
70,856
|
|
|
$
|
74.63
|
|
|
112,036
|
|
|
$
|
79.48
|
|
Granted
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Exercised
(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Released from restriction
(b)
|
|
—
|
|
|
—
|
|
|
(15,080
|
)
|
|
89.58
|
|
|
(2,753
|
)
|
|
78.92
|
|
|||
Cancelled/expired
|
|
(26,075
|
)
|
|
81.94
|
|
|
(1,344
|
)
|
|
72.63
|
|
|
(28,440
|
)
|
|
96.97
|
|
|||
Outstanding at March 31, 2018
|
|
536,802
|
|
|
$
|
75.60
|
|
|
54,432
|
|
|
$
|
70.53
|
|
|
80,843
|
|
|
$
|
73.35
|
|
(a)
|
Until they vest, PSUs are included in the table at the target level at their grant date and at that level represent
one
share of common stock per PSU. The performance period for the 2015 PSU grant ended in 2017. The Company cancelled
25,897
PSUs in 2018 related to the 2015 PSU grant.
|
(b)
|
Common stock issued for exercised options and for vested and earned RSUs and PSUs was issued from treasury stock.
|
Three Months Ended March 31, 2018
(a)
|
Gains and
(Losses) on
Cash Flow
Hedges
|
|
Defined
Benefit
Pension
|
|
Foreign
Currency
|
|
Total
|
||||||||
Beginning balance
|
$
|
(0.9
|
)
|
|
$
|
(3.9
|
)
|
|
$
|
(73.1
|
)
|
|
$
|
(77.9
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive loss before reclassifications
(b)
|
(0.2
|
)
|
|
—
|
|
|
(14.4
|
)
|
|
(14.6
|
)
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
(0.3
|
)
|
|
0.1
|
|
|
—
|
|
|
(0.2
|
)
|
||||
Net current period other comprehensive income (loss)
|
(0.5
|
)
|
|
0.1
|
|
|
(14.4
|
)
|
|
(14.8
|
)
|
||||
Reclassification of stranded tax out of AOCI to retained earnings
(c)
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
||||
Ending balance
|
$
|
(1.6
|
)
|
|
$
|
(3.8
|
)
|
|
$
|
(87.5
|
)
|
|
$
|
(92.9
|
)
|
Three Months Ended March 31, 2017
(a)
|
Gains and
(Losses) on
Cash Flow
Hedges
|
|
Defined
Benefit
Pension
|
|
Foreign
Currency
|
|
Total
|
||||||||
Beginning balance
|
$
|
0.6
|
|
|
$
|
(3.7
|
)
|
|
$
|
(101.8
|
)
|
|
$
|
(104.9
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss) before reclassifications
(b)
|
(0.5
|
)
|
|
—
|
|
|
14.8
|
|
|
14.3
|
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
||||
Net current period other comprehensive income (loss)
|
(0.5
|
)
|
|
0.1
|
|
|
14.8
|
|
|
14.4
|
|
||||
Ending balance
|
$
|
0.1
|
|
|
$
|
(3.6
|
)
|
|
$
|
(87.0
|
)
|
|
$
|
(90.5
|
)
|
(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 income (loss) presented in the tables above are reflected net of applicable income taxes.
|
(b)
|
The Company recorded foreign exchange (gains) losses of
$(4.4) million
and
$7.2 million
in the
three
months ended
March 31, 2018
and 2017, respectively, in accumulated other comprehensive loss related to intercompany notes which were deemed to be of long-term investment nature.
|
(c)
|
In the first quarter of 2018, the Company adopted guidance which allows entities to reclassify tax effects of the change in U.S. income tax rates from AOCI to retained earnings (see
Note 1
).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31, 2018 |
|
Three Months Ended
March 31, 2017 |
|
Line Item Impacted in the
Consolidated Statement of Operations
|
||||
Gains and (losses) on cash flow hedges:
|
|
|
|
|
|
||||
Natural gas instruments
|
$
|
—
|
|
|
$
|
—
|
|
|
Product cost
|
Foreign currency swaps
|
(0.5
|
)
|
|
—
|
|
|
Interest expense
|
||
Income tax expense (benefit)
|
0.2
|
|
|
—
|
|
|
|
||
Reclassifications, net of income taxes
|
(0.3
|
)
|
|
—
|
|
|
|
||
Amortization of defined benefit pension:
|
|
|
|
|
|
|
|||
Amortization of loss
|
$
|
0.1
|
|
|
$
|
0.1
|
|
|
Product cost
|
Income tax expense (benefit)
|
—
|
|
|
—
|
|
|
|
||
Reclassifications, net of income taxes
|
0.1
|
|
|
0.1
|
|
|
|
||
Total reclassifications, net of income taxes
|
$
|
(0.2
|
)
|
|
$
|
0.1
|
|
|
|
|
|
|
|
|
|
12.
|
Derivative Financial Instruments:
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
Derivatives designated as hedging instruments:
|
|
Balance Sheet Location
|
|
March 31, 2018
|
|
Balance Sheet Location
|
|
March 31, 2018
|
||||
Commodity contracts
|
|
Other current assets
|
|
$
|
—
|
|
|
Accrued expenses
|
|
$
|
0.9
|
|
Commodity contracts
|
|
Other assets
|
|
—
|
|
|
Other noncurrent liabilities
|
|
0.5
|
|
||
Swap contracts
|
|
Other current assets
|
|
0.8
|
|
|
Accrued expenses
|
|
—
|
|
||
Swap contracts
|
|
Other assets
|
|
0.3
|
|
|
Other noncurrent liabilities
|
|
—
|
|
||
Total derivatives designated as hedging instruments
(a)
|
|
|
|
1.1
|
|
|
|
|
1.4
|
|
||
|
|
|
|
|
|
|
|
|
||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
||||
Forward contracts
|
|
Other current assets
|
|
$
|
0.3
|
|
|
Accrued expenses
|
|
$
|
—
|
|
Total derivatives not designated as hedging instruments
|
|
|
|
0.3
|
|
|
|
|
—
|
|
||
Total derivatives
(b)
|
|
|
|
$
|
1.4
|
|
|
|
|
$
|
1.4
|
|
(a)
|
The Company has master netting agreements with its commodity hedge counterparties and accordingly has netted in its Consolidated Balance Sheets an immaterial amount receivable from one counterparty.
|
(b)
|
The Company has commodity hedge and foreign currency agreements with
two
and
three
counterparties, respectively. Amounts recorded as liabilities for the Company’s commodity contracts are payable to
two
counterparties. The amounts recorded as receivables for the Company’s swap contracts are receivable from
two
counterparties. The amounts recorded as receivables for the Company’s forward contracts are due from
one
counterparty.
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
Derivatives designated as hedging instruments:
|
|
Balance Sheet Location
|
|
December 31, 2017
|
|
Balance Sheet Location
|
|
December 31, 2017
|
||||
Commodity contracts
|
|
Other current assets
|
|
$
|
—
|
|
|
Accrued expenses
|
|
$
|
1.0
|
|
Commodity contracts
|
|
Other assets
|
|
—
|
|
|
Other noncurrent liabilities
|
|
0.4
|
|
||
Swap contracts
|
|
Other current assets
|
|
0.9
|
|
|
Accrued expenses
|
|
—
|
|
||
Swap contracts
|
|
Other assets
|
|
0.4
|
|
|
Other noncurrent liabilities
|
|
—
|
|
||
Total derivatives designated as hedging instruments
(a)(b)
|
|
|
|
$
|
1.3
|
|
|
|
|
$
|
1.4
|
|
(a)
|
The Company has master netting agreements with its commodity hedge counterparties and accordingly has netted in its Consolidated Balance Sheets less than
$0.1 million
of its commodity contracts that are in a receivable position against its contracts in payable positions.
|
(b)
|
The Company has both commodity hedge and foreign currency swap agreements with
two
counterparties each. Amounts recorded as liabilities for the Company’s commodity contracts are payable to both counterparties, and amounts recorded as assets for the Company’s swap contracts are receivable from both counterparties.
|
13.
|
Fair Value Measurements:
|
|
March 31,
2018 |
|
Level One
|
|
Level Two
|
|
Level Three
|
||||||||
Asset Class:
|
|
|
|
|
|
|
|
||||||||
Mutual fund investments in a non-qualified retirement plan
(a)
|
$
|
1.8
|
|
|
$
|
1.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Derivatives – foreign currency instruments, net
|
1.4
|
|
|
—
|
|
|
1.4
|
|
|
—
|
|
||||
Total Assets
|
$
|
3.2
|
|
|
$
|
1.8
|
|
|
$
|
1.4
|
|
|
$
|
—
|
|
Liability Class:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities related to non-qualified retirement plan
|
$
|
(1.8
|
)
|
|
$
|
(1.8
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Derivatives – natural gas instruments, net
|
(1.4
|
)
|
|
—
|
|
|
(1.4
|
)
|
|
—
|
|
||||
Total Liabilities
|
$
|
(3.2
|
)
|
|
$
|
(1.8
|
)
|
|
$
|
(1.4
|
)
|
|
$
|
—
|
|
(a)
|
Includes mutual fund investments of approximately
25%
in common stock of large-cap U.S. companies,
20%
in common stock of small to mid-cap U.S. companies,
5%
in international companies,
15%
in bond funds,
15%
in short-term investments and
20%
in blended funds.
|
|
December 31,
2017 |
|
Level One
|
|
Level Two
|
|
Level Three
|
||||||||
Asset Class:
|
|
|
|
|
|
|
|
||||||||
Mutual fund investments in a non-qualified savings plan
(a)
|
$
|
2.2
|
|
|
$
|
2.2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Derivatives – foreign currency swaps, net
|
1.3
|
|
|
—
|
|
|
1.3
|
|
|
—
|
|
||||
Total Assets
|
$
|
3.5
|
|
|
$
|
2.2
|
|
|
$
|
1.3
|
|
|
$
|
—
|
|
Liability Class:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities related to non-qualified savings plan
|
$
|
(2.2
|
)
|
|
$
|
(2.2
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Derivatives – natural gas instruments, net
|
(1.4
|
)
|
|
—
|
|
|
(1.4
|
)
|
|
—
|
|
||||
Total Liabilities
|
$
|
(3.6
|
)
|
|
$
|
(2.2
|
)
|
|
$
|
(1.4
|
)
|
|
$
|
—
|
|
(a)
|
Includes mutual fund investments of approximately
30%
in the common stock of large-cap U.S. companies,
15%
in the common stock of small to mid-cap U.S. companies,
5%
in the common stock of international companies,
10%
in bond funds,
20%
in short-term investments and
20%
in blended funds.
|
14.
|
Earnings per Share:
|
|
Three months ended
March 31, |
||||||
|
2018
|
|
2017
|
||||
Numerator:
|
|
|
|
||||
Net earnings
|
$
|
12.6
|
|
|
$
|
21.5
|
|
Less: net earnings allocated to participating securities
(a)
|
(0.1
|
)
|
|
(0.1
|
)
|
||
Net earnings available to common shareholders
|
$
|
12.5
|
|
|
$
|
21.4
|
|
|
|
|
|
||||
Denominator (in thousands):
|
|
|
|
|
|
||
Weighted-average common shares outstanding, shares for basic earnings per share
|
33,836
|
|
|
33,802
|
|
||
Weighted-average awards outstanding
(b)
|
—
|
|
|
1
|
|
||
Shares for diluted earnings per share
|
33,836
|
|
|
33,803
|
|
||
Net earnings per common share, basic
|
$
|
0.37
|
|
|
$
|
0.63
|
|
Net earnings per common share, diluted
|
$
|
0.37
|
|
|
$
|
0.63
|
|
(a)
|
Weighted participating securities include RSUs and PSUs that receive non-forfeitable dividends and consist of
163,000
and
157,000
wighted participating securities for the
three
months ended
March 31, 2018
and
2017
, 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
618,000
and
487,000
weighted-average equity awards outstanding for the
three
months ended
March 31, 2018
and
2017
, respectively.
|
15.
|
Subsequent Event:
|
•
|
The largest rock salt mine in the world in Goderich, Ontario, Canada;
|
•
|
The largest dedicated rock salt mine in the U.K. in Winsford, Cheshire;
|
•
|
A solar evaporation facility located in Ogden, Utah, which is both the largest SOP production site and the largest solar salt production site in the Western Hemisphere;
|
•
|
Several mechanical evaporation facilities producing consumer and industrial salt; and
|
•
|
Several facilities producing essential agricultural nutrients and specialty chemicals in Brazil.
|
•
|
Total sales
increased
13%
, or
$50.1 million
, due to increases in all three segments.
|
•
|
Operating earnings
decreased
36%
, or
$14.8 million
, due to declines in all three segments.
|
•
|
Earnings before interest, taxes, depreciation and amortization (“EBITDA”)* adjusted for items management believes are not indicative of our ongoing operating performance (“Adjusted EBITDA”)*
decreased
13%
, or
$9.0 million
.
|
•
|
Diluted earnings per share
decreased
41%
, or
$0.26
.
|
|
|
|
|
|
•
|
Salt segment gross profit decreased $11.6 million primarily due to increased per-unit product costs and higher shipping and handling costs.
|
•
|
The plant nutrition business, on a combined basis, contributed $4.8 million to the decrease in gross profit. The Plant Nutrition North America segment gross profit decreased $2.9 million primarily due to higher per-unit costs which were partially offset by lower per-unit shipping and handling costs. The Plant Nutrition South America segment gross profit decreased $1.9 million as a result of a $1.9 million gain recognized in the first quarter of 2017 due to the finalization of contingent consideration related to the acquisition of Produquímica.
|
|
|
|
|
|
|
•
|
The decrease in SG&A expense was primarily due to a decrease in marketing and advertising spending in our Salt and Plant Nutrition South America segments and a decrease in costs related to the restructuring actions taken in 2017. The decrease in SG&A was partially offset by an increase in corporate depreciation expense related to a significant software system upgrade implemented in the second quarter of 2017.
|
•
|
We realized foreign exchange gains of $3.1 million in the first quarter of 2018 and foreign exchange losses of $1.1 million in the first quarter of 2017.
|
•
|
The
decrease
in income tax expense was primarily due to lower pretax income in the first quarter of 2018 partially offset by an increase in the effective tax rate.
|
•
|
Our income tax provision in both periods differs from the U.S. statutory rate primarily due to U.S. statutory depletion, state income taxes, foreign income, mining and withholding taxes and interest expense recognition differences for tax and financial reporting purposes.
|
•
|
Our effective tax rate
increased
from
23%
in the
first
quarter of
2017
to
26%
in the
first
quarter of
2018
, primarily due to a reduction in certain tax valuation allowances in the first quarter of 2017 related to the acquired Produquimica business, which was partially offset by lower federal rates due to the U.S. Tax Cuts and Jobs Act.
|
|
1Q 2018
|
|
1Q 2017
|
||||
Salt Sales (in millions)
|
$
|
315.9
|
|
|
$
|
274.8
|
|
Salt Operating Earnings (in millions)
|
$
|
34.1
|
|
|
$
|
45.4
|
|
Salt Sales Volumes (thousands of tons)
|
|
|
|
||||
Highway deicing
|
4,262
|
|
|
3,491
|
|
||
Consumer and industrial
|
502
|
|
|
542
|
|
||
Total tons sold
|
4,764
|
|
|
4,033
|
|
||
Average Salt Sales Price (per ton)
|
|
|
|
||||
Highway deicing
|
$
|
55.24
|
|
|
$
|
55.25
|
|
Consumer and industrial
|
$
|
160.26
|
|
|
$
|
151.25
|
|
Combined
|
$
|
66.32
|
|
|
$
|
68.14
|
|
•
|
Salt sales
increased
15%
, or
$41.1 million
, primarily due to higher deicing sales volumes which was partially offset by lower consumer and industrial sales volumes.
|
•
|
Salt average sales prices
decreased
3%
due to product sales mix, as highway deicing products which have a lower average sales price were a higher proportion of total sales in the current period.
|
•
|
Highway deicing average sales prices were flat. Consumer and industrial average sales prices
increased
6%
due to an improvement in product sales mix and price increases taken over the last 12 months.
|
•
|
Salt sales volumes
increased
18%
, or
731,000
tons, and contributed approximately $37 million to the increase in Salt segment sales. Highway deicing sales volumes increased 22% as a result of significantly above average winter weather in the U.K. and more winter weather events in North America in the first quarter of 2018 compared to the prior year. Consumer and industrial sales volumes
decreased
7%
.
|
•
|
Salt operating earnings
decreased
25%
, or
$11.3 million
, due to higher per-unit product and logistics costs as well as higher-cost inventory produced in 2017 and sold in the first quarter of 2018. The higher per-unit product and logistics
|
|
1Q 2018
|
|
1Q 2017
|
||||
Plant Nutrition North America Sales (in millions)
|
$
|
52.9
|
|
|
$
|
49.2
|
|
Plant Nutrition North America Operating Earnings (in millions)
|
$
|
4.9
|
|
|
$
|
7.6
|
|
Plant Nutrition North America Sales Volumes (thousands of tons)
|
87
|
|
|
79
|
|
||
Plant Nutrition North America Average Sales Price (per ton)
|
$
|
610
|
|
|
$
|
624
|
|
•
|
Plant Nutrition North America sales
increased
8%
, or
$3.7 million
.
|
•
|
Plant Nutrition North America sales volumes
increased
10%
, or
8,000
tons, and contributed approximately
$5 million
to the increase in Plant Nutrition North America sales. The increase in sales volumes was primarily driven by an increase in SOP sales volumes.
|
•
|
The
2%
decrease
in Plant Nutrition North America average sales price partially offset the increase in Plant Nutrition North America sales by approximately
$1 million
. The decrease in average sales price was primarily due to decreases in the average sales prices for our micronutrient products.
|
•
|
Plant Nutrition North America operating earnings
decreased
36%
, or
$2.7 million
, primarily due to higher depreciation expense associated with commissioning new production assets at our Ogden facility and higher-cost carryover inventory produced in 2017 and sold in the first quarter of 2018.
|
|
1Q 2018
|
|
1Q 2017
|
||||
Plant Nutrition South America Sales (in millions)
|
$
|
66.3
|
|
|
$
|
61.3
|
|
Plant Nutrition South America Operating Earnings (in millions)
|
$
|
0.8
|
|
|
$
|
1.8
|
|
Plant Nutrition South America Sales Volumes (thousands of tons)
|
|
|
|
||||
Agricultural productivity
|
61
|
|
|
60
|
|
||
Chemical solutions
|
79
|
|
|
72
|
|
||
Total tons sold
|
140
|
|
|
132
|
|
||
Average Plant Nutrition South America Sales Price (per ton)
|
|
|
|
||||
Agricultural productivity
|
$
|
646
|
|
|
$
|
599
|
|
Chemical solutions
|
$
|
339
|
|
|
$
|
354
|
|
Combined
|
$
|
473
|
|
|
$
|
465
|
|
•
|
Plant Nutrition South America sales
increased
8%
, or
$5.0 million
.
|
•
|
Plant Nutrition South America sales volumes
increased
6%
, or
8,000
tons, and contributed approximately $3 million to the increase in Plant Nutrition South America sales. The increase in sales volumes was primarily driven by an increase in sales of chemical solutions products.
|
•
|
A
2%
increase
in Plant Nutrition South America average sales price contributed approximately $2 million to the Plant Nutrition South America sales increase. The increase in average sales price was primarily due to an 8% increase in agriculture product sales prices, partially offset by a 4% decrease in chemical solutions product prices due to shifts in product sales mix.
|
•
|
Plant Nutrition South America operating earnings
decreased
56%
, or
$1.0 million
, as a result of a $1.9 million gain recognized in the first quarter of 2017 due to the finalization of contingent consideration related to the acquisition of Produquímica and a weaker Brazilian reais versus the U.S. dollar.
|
•
|
Winter weather events in North America in April 2018 combined with continued strong demand in the U.K. are expected to increase second quarter 2018 Salt sales from those in the same period of the prior year. We expect Salt sales volumes to range from 11.8 million to 12.6 million tons in 2018.
|
•
|
Salt segment operating margins in the the second quarter of 2018 are expected to improve from those experienced in the first quarter of 2018.
|
•
|
The winter weather in the 2017-2018 season is expected to result in favorable market dynamics for salt producers in the upcoming highway deicing bid season.
|
•
|
Plant Nutrition North America sales volumes are expected to range from 320,000 to 350,000 tons in 2018.
|
•
|
Plant Nutrition North America operating margins in the second quarter of 2018 are expected to be similar to those experienced in the first quarter of 2018. Lower sales, particularly micronutrients, and higher depreciation expense are expected to pressure second quarter Plant Nutrition North America operating margins.
|
•
|
We expect 2018 Plant Nutrition South America sales volumes to range from 700,000 to 900,000 tons.
|
•
|
We expect revenues in the first half of 2018 to be higher than those in 2017 and second quarter operating margins to be higher than the same period in 2017 for our Plant Nutrition South America segment.
|
THREE MONTHS ENDED MARCH 31, 2018
|
THREE MONTHS ENDED MARCH 31, 2017
|
Operating Activities
:
|
|
» Net earnings were $12.6 million.
|
» Net earnings were $21.5 million.
|
» Non-cash depreciation and amortization expense was $34.3 million.
|
» Non-cash depreciation and amortization expense was $28.4 million.
|
» Working capital items were a source of operating cash flows of $123.7 million.
|
» Working capital items were a source of operating cash flows of $79.1 million.
|
Investing Activities
:
|
|
» Net cash flows used by investing activities included $23.0 million of capital expenditures.
|
» Net cash flows used by investing activities included $21.0 million of capital expenditures.
|
Financing Activities
:
|
|
» Net cash flows used by financing activities included the payment of dividends of $24.5 million.
» In addition, we had net payments on our debt of $112.0 million.
|
» Net cash flows used by financing activities included the payment of dividends of $24.4 million.
» In addition, we had net payments on our debt of $93.8 million.
» We also paid $14.7 million for the final payment related to the Produquímica acquisition.
|
|
Three Months Ended
March 31, |
||||||
|
2018
|
|
2017
|
||||
Net earnings
|
$
|
12.6
|
|
|
$
|
21.5
|
|
Interest expense
|
13.7
|
|
|
13.7
|
|
||
Income tax expense
|
4.4
|
|
|
6.3
|
|
||
Depreciation, depletion and amortization
|
34.3
|
|
|
28.4
|
|
||
EBITDA
|
65.0
|
|
|
69.9
|
|
||
Adjustments to EBITDA:
|
|
|
|
|
|
||
Other income, net
|
(4.2
|
)
|
|
(0.1
|
)
|
||
Adjusted EBITDA
|
$
|
60.8
|
|
|
$
|
69.8
|
|
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
|
|
|
|
|
|
Date: May 2, 2018
|
By:
|
/s/ James D. Standen
|
|
|
|
James D. Standen
|
|
|
|
Chief Financial Officer
|
|
|
|
(Principal Financial and Accounting Officer)
|
|
|
COMPASS MINERALS INTERNATIONAL, INC.
|
2015 INCENTIVE AWARD PLAN
|
|
By:
|
/s/ Steven N. Berger
|
1.
|
I have reviewed this quarterly report on Form 10-Q 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: May 2, 2018
|
By:
|
/s/ Francis J. Malecha
|
|
|
|
Francis J. Malecha
|
|
|
|
President and Chief Executive Officer
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q 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: May 2, 2018
|
By:
|
/s/ James D. Standen
|
|
|
|
James D. Standen
|
|
|
|
Chief Financial Officer
|
|
|
|
|
Date: May 2, 2018
|
By:
|
/s/ Francis J. Malecha
|
|
|
Francis J. Malecha
|
|
|
President and Chief Executive Officer
|
|
|
|
|
By:
|
/s/ James D. Standen
|
|
|
James D. Standen
|
|
|
Chief Financial Officer
|
1
|
Represents the number of citations and orders issued under section 104 of the Mine Act for alleged violations of mandatory health or safety standards that could significantly and substantially contribute to a mine health and safety hazard. The number reported includes no orders alleging an S&S violation issued under Section 104(g) of the Mine Act.
|
2
|
Represents the number of orders issued under section 104(b) of the Mine Act for alleged failures to abate a citation issued under section 104(a) of the Mine Act within the time period specified in the citation.
|
3
|
Represents the number of citations and orders issued under section 104(d) of the Mine Act for alleged unwarrantable failures (aggravated conduct constituting more than ordinary negligence) to comply with mandatory safety or health standards.
|
4
|
Represents the number of violations issued under section 110(b)(2) of the Mine Act for alleged “flagrant” failures (reckless or repeated failures) to make reasonable efforts to eliminate a known violation of a mandatory safety or health standard that substantially proximately caused, or reasonably could have been expected to cause, death or serious bodily injury.
|
5
|
Represents the number of orders issued under section 107(a) of the Mine Act for alleged conditions or practices which could reasonably be expected to cause death or serious physical harm before the condition or practice can be abated.
|
6
|
Section 104(e) written notices are issued for an alleged pattern of violating mandatory health or safety standards that could significantly and substantially contribute to a mine safety or health hazard.
|