Intrepid Potash, Inc. (NYSE:IPI) Q4 2015 Earnings Conference Call - Final Transcript
Feb 29, 2016 • 10:00 am ET
Thank you for standing by. This is the Chorus Call conference operator, and welcome to the Intrepid Potash Fourth Quarter 2015 Earnings Conference Call. As a reminder, all participants are in a listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. [Operator Instructions]
At this time, I'd like to turn the conference over to Gary Kohn, Vice President, Investor Relations. Please go ahead, Mr. Kohn.
Thanks, Joe. Good morning, everyone, and welcome to our call today.
I will remind you that parts of our discussion will include forward-looking statements, as defined by U.S. Securities Laws. These statements are not guarantees of future performance and are based on a number of assumptions, which we believe are reasonable. These statements are based on the information available to us today, and we are not assuming any obligation to update them. You can find more information about risks and uncertainties to our future performance in our periodic reports filed with the SEC.
During today's call, we will refer to certain non-GAAP financial and operational measures. Reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures are included in this morning's press release. Our SEC filings and press releases are available on our website at intrepidpotash.com.
Presenting on the call today are Bob Jornayvaz, our Co-founder, Executive Chairman, President and CEO; and Brian Frantz, Senior Vice President and Chief Accounting Officer. Kelvin Feist, our Senior Vice President of Sales and Marketing is also available for Q&A.
With that, I'll turn the call over to Bob.
Thank you, Gary, and good morning, everyone. In this morning's press release, you saw that our auditors were required to add going concern language to their audit opinion. I want to address this first.
We announced on January 15 that we had amended our debt covenants for both our credit line and our senior notes to take into account the then current potash pricing environment and expectations for spring demand. That amendment was designed to get Intrepid through an anticipated low-price environment to the conversion of our East facility to Trio-only production.
However, considering the further potash price declines, we now expect that we will not be able to maintain compliance with our revised debt covenants throughout 2016. We have been engaged with our lenders during the last few weeks to come to an updated agreement, but unfortunately, despite the cooperative nature of our discussions, we were not able to reach another new agreement, before our 10-K filing deadline today.
If we are unable to meet compliance with our covenants, our lenders would have the ability to demand repayment of all amounts due to them, as we might not have adequate liquidity to pay the balance in full at that point in time the going concern language is required. To provide us with the time and flexibility to continue working with our lending group, we have obtained a 30-day waiver as to the going concern language.