Compass Minerals Reports Q3 FY25 Earnings: Adjusted EBITDA Up 25% YoY, Net Loss Down to $17mln

Compass Minerals reported a Q3 net loss of $17 million, improved from a $43.6 million loss in the prior year. The Salt business saw a 4% increase in operating earnings and a 6% increase in adjusted EBITDA per ton, with sales volumes up 4% YoY. Plant Nutrition sales volumes rose 21% YoY, with operating earnings and adjusted EBITDA increasing on both absolute and per-ton bases.

Compass Minerals International (NYSE: CMP) has reported its Q3 2025 financial results, showcasing a significant turnaround in its operational performance. The company reported a net loss of $17.0 million, a substantial improvement from the $43.6 million loss in the prior year [1]. This improvement was driven by a 25% year-over-year increase in adjusted EBITDA to $41.0 million, with both the Salt and Plant Nutrition segments contributing to this growth [1].

The Salt business, which accounts for 77% of total revenue, saw a 4% increase in operating earnings and a 6% increase in adjusted EBITDA per ton, with sales volumes up 4% year-over-year (YoY). The Plant Nutrition segment experienced a 21% YoY increase in sales volumes, resulting in improvements in both absolute and per-ton operating earnings and adjusted EBITDA [1].

The Salt segment's revenue increased to $166.0 million, supported by a 4% rise in sales volumes, despite a 1% decline in average selling prices. The Salt business's adjusted EBITDA expanded by 10.1% to $45.8 million, reflecting operational efficiency gains and strong demand in North American infrastructure markets [1].

The Plant Nutrition segment delivered a 15.5% revenue increase to $44.8 million, driven by a 21% surge in sales volumes. Although average selling prices fell 4.7% due to global potassium supply dynamics, the segment's adjusted EBITDA expanded by 58.3% to $11.4 million. This volume-driven recovery highlights Compass Minerals' ability to offset pricing pressures through strategic positioning in high-value markets [1].

Compass Minerals' refinancing activities reduced net debt by 13% to $746 million, enhancing liquidity to $389 million. The company's strategic refinancing efforts and asset sales have positioned it to withstand near-term volatility while investing in operational improvements [1].

The company's guidance for fiscal 2025 further reinforces its turnaround trajectory. Salt segment volumes are projected to reach 10,700-11,000 thousand tons, with adjusted EBITDA expected to range between $220-229 million. For Plant Nutrition, volumes of 320-325 thousand tons and adjusted EBITDA of $24-27 million signal continued momentum. These targets, combined with a capital expenditure forecast of $75-85 million, reflect a balanced approach to growth and cost control [1].

Despite the positive momentum, investors must remain cognizant of Compass Minerals' high leverage (Total Debt/Equity ratio of 319.14%) and exposure to commodity price swings. The Salt segment's reliance on highway deicing contracts, while stable, is subject to regulatory and budgetary shifts. Additionally, the Plant Nutrition segment's profitability hinges on global fertilizer demand, which could face headwinds from macroeconomic slowdowns or trade policy changes [1].

In conclusion, Compass Minerals' Q3 results present a compelling case for investors seeking undervalued industrial plays with clear turnaround momentum. The narrowing loss, volume-driven EBITDA growth, and strategic refinancing efforts demonstrate a company in recovery. However, the high debt load and sector-specific risks necessitate a measured approach. For investors with a medium-term horizon and a tolerance for volatility, Compass Minerals offers an attractive entry point into a sector poised for cyclical improvement.

References:
[1] https://www.ainvest.com/news/compass-minerals-fiscal-q3-adjusted-loss-narrows-revenue-rises-glimpse-operational-recovery-sector-resilience-2508/
[2] https://www.tradingview.com/news/reuters.com,2025:newsml_PLX460D13:0-compass-minerals-q3-revenue-meets-estimates/
[3] https://finance.yahoo.com/news/compass-minerals-reports-fiscal-2025-203000397.html