LSB INDUSTRIES, INC.
For the period ended Jun 30, 2025. Filed Jul 30, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Jul 30, 2025
LXU$10.60+2.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-04-30.
0000950170-25-061149
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-07-30.
0000950170-25-100258
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 149 previous paragraphs and 175 current paragraphs.
97 unchanged; 42 reworded; 30 added; 7 removed; 3 previous and 6 current paragraphs rearranged.
Tables are not compared: 9 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (30)
Current report
Shift in Production Mix
Current report
Over the last several months, we commenced the process of transitioning our production of HDAN, an agricultural/fertilizer product, to ANS, a product used in industrial and mining applications. We expect this transition to be complete and production of HDAN to cease later in the third quarter of 2025. This transition is consistent with our strategy to shift a portion of our sales mix from agricultural sales made at spot market pricing, which can be volatile, towards sales covered under multi-year contracts where we pass through the cost of natural gas feedstock. With the discontinuation of HDAN production, we will also close our agricultural retail location in Elkhart, TX, as its primarily purpose was to sell the HDAN we produced. The process to close this retail location commenced at the beginning of the third quarter of 2025 and will be substantially complete by quarter-end.
Current report
During the second quarter of 2025 we repurchased $32.4 million in principal amount of our Senior Secured Notes due 2028 (“Senior Secured Notes”) for approximately $32.1 million, which was accounted for as an extinguishment of debt. Including our write-off of the associated remaining portion of unamortized debt issuance costs, we recognized a loss on extinguishment of debt of approximately $0.1 million.
Current report
During the second quarter of 2024 we repurchased $63.7 million in principal amount of our Senior Secured Notes for approximately $60.9 million. Including our write-off of the associated remaining portion of unamortized debt issuance costs, we recognized a gain on extinguishment of debt of approximately $1.9 million.
Current report
Selling, General and Administrative
Current report
Our SG&A expenses were $9.8 million for the second quarter of 2025, a decrease of $1.7 million compared to the same period in 2024. The net decrease was primarily driven by decreases in professional fees, insurance and other miscellaneous expenses items, partially offset by an increase in payroll related expenses.
Current report
Other expense, net
Current report
Other expense, net for the second quarter of 2025 consisted primarily of asset write-downs, which were lower in 2024 compared to 2025.
Current report
(Loss) Gain on Extinguishment of Debt
Current report
During the second quarter of 2025, we repurchased $32.4 million in principal amount of our Senior Secured Notes for approximately $32.1 million, which was accounted for as an extinguishment of debt. Including our write-off of the associated remaining portion of unamortized debt issuance costs, we recognized a loss on extinguishment of debt of approximately $0.1 million. During the second quarter of 2024, we repurchased $63.7 million in principal amount of our Senior Secured Notes for approximately $60.9 million. Including our write-off of the associated remaining portion of unamortized debt issuance costs, we recognized a gain on extinguishment of debt of approximately $1.9 million.
Current report
Provision for Income Taxes
Current report
Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024
Current report
The following table contains certain financial information for the six months ended June 30, 2025 and 2024, the increase or decrease between those periods, and the percentage increase or decrease between those periods with respect to each line item:
Current report
N/M-Not meaningful.
Current report
Net Sales
Current report
Net sales of our primary products increased during the first half of 2025 compared to the prior year period driven by the impact of higher volumes for UAN and our AN & Nitric Acid product group and improved pricing for UAN and ammonia. Partially offsetting this increase was lower pricing for our AN & Nitric Acid product group and lower ammonia sales volumes. Additionally, we benefited from a healthy increase in downstream upgraded product production volumes.
Current report
Gross Profit
Current report
As noted in the table above, we recognized a gross profit of $37.6 million for the first half of 2025 compared to $49.7 million for the same period in 2024, a $12.1 million reduction. Overall, our gross profit percentage was 12.7% compared to a gross profit percentage of 17.9% for the same period in 2024. Our adjusted gross profit percentage was 28.1% for the first half of 2025 compared to 32.3% for the same period in 2024. Our gross profit for the first half of 2025 was lower compared to the same period of 2024 primarily due to higher natural gas costs and higher depreciation due to recent investments in our facilities. These cost increases were partially offset by higher net sales.
Current report
Selling, General and Administrative
Current report
Our SG&A expenses were $20.0 million for the first half of 2025, a decrease of $1.8 million compared to the same period in 2024. The net decrease was primarily driven by decreases in professional fees, insurance and other miscellaneous expenses items, partially offset by an increase in payroll related expenses.
Current report
Interest Expense
Current report
Interest expense for the first half of 2025 was $16.0 million compared to $18.1 million for the same period in 2024. The decrease primarily related to reduced interest expense as a result of repurchases of Senior Secured Notes made during 2024 and the second quarter of 2025.
Current report
(Loss) gain on Extinguishment of Debt
Current report
Other Expense, net
Current report
Non-operating Other Income, net
Current report
Provision for Income Taxes
Current report
Net cash provided by investing activities was $4.8 million for the first six months of 2025 compared to $168.8 million for the same period of 2024, a change of $164.0 million.
Current report
Net cash used by financing activities was $44.4 million for the first six months of 2025 compared to $119.0 million for the same period of 2024, a change of $74.5 million.
Current report
Capital Expenditures – First Six Months of 2025
Current report
During the six months ended June 30, 2025, we repurchased $32.4 million in principal amount of our Senior Secured Notes for approximately $32.1 million, which was accounted for as an extinguishment of debt. The debt repurchase was intended as a means to deleverage our balance sheet and reduce future interest costs while maintaining a balanced capital allocation strategy that provides an appropriate level of liquidity to fund our operations and future growth opportunities.
Removed paragraphs (7)
Previous report
In October 2023, we announced a collaboration with INPEX Corporation and Air Liquide Group to conduct a preliminary front end engineering design (“pre-FEED”) study for the development of a large-scale, low carbon ammonia production and export project on the Houston Ship Channel. Initially targeted to produce more than 1.1 million metric tons per year of low carbon ammonia beginning in 2029, the pre-FEED study was completed in the fourth quarter of 2024. Given the impact of U.S. tariff-related price increases and other global economic uncertainties on costs, coupled with a slower-than-anticipated ramp-up of low carbon ammonia demand, we have decided to put a pause on the project.
Previous report
Other (income) expense, net
Previous report
Gain on Extinguishment of Debt
Previous report
(Benefit) provision for Income Taxes
Previous report
Net cash used by investing activities was $5.3 million for the first three months of 2025 compared to net cash provided by investing activities of $47.9 million for the same period of 2024, a change of $53.2 million.
Previous report
Net cash used by financing activities was $6.8 million for the first three months of 2025 compared to net cash used of $44.5 million for the same period of 2024, a change of $37.8 million.
Previous report
Capital Expenditures – First Three Months of 2025
Reworded paragraphs (42)
Previous wording
LSB is headquartered in Oklahoma City, Oklahoma and we manufacture and sell chemical products for the agricultural and industrial markets. We own and operate three multi-plant facilities in Cherokee, Alabama (the “Cherokee Facility”), El Dorado, Arkansas (the “El Dorado Facility”) and Pryor, Oklahoma (the “Pryor Facility”) and operate a facility on behalf of Covestro in Baytown, Texas (the “Baytown Facility”). Our products are sold through distributors and directly to end customers primarily throughout the U.S. and other parts of North America.
Current wording
LSB is headquartered in Oklahoma City, Oklahoma and we manufacture and sell chemical products for the agricultural and industrial markets. We own and operate three multi-plant facilities in Cherokee, Alabama (the “Cherokee Facility”), El Dorado, Arkansas (the “El Dorado Facility”) and Pryor, Oklahoma (the “Pryor Facility”) and operate a facility on behalf of Covestro LLC in Baytown, Texas. Our products are sold through distributors and directly to end customers primarily throughout the United States and other parts of North America.
Previous wording
Evaluate and Pursue Organic Capacity Expansion. We have been evaluating opportunities across all our facilities to increase production capacity through the implementation of several potential debottlenecking projects, particularly at our El Dorado Facility. Initial feasibility studies have pointed to potentially attractive returns for some of these projects. However, given the current high-cost environment and limited resources, coupled with our outlook for moderating selling prices, during 2024 we elected to put the El Dorado expansion projects on hold. We plan to reevaluate these projects over the course of 2025 to determine our prospects of moving forward with one or more of them in the future.
Current wording
Evaluate and Pursue Organic Capacity Expansion. We have been evaluating opportunities across all our facilities to increase production capacity through the implementation of several potential debottlenecking projects, particularly at our El Dorado Facility. Initial feasibility studies have pointed to potentially attractive returns for some of these projects. However, given the current high-cost environment and limited resources, coupled with our outlook for moderating selling prices, during 2024 we elected to put the El Dorado expansion projects on hold. We will continue evaluating these projects over the course of 2025 to determine our prospects of moving forward with one or more of them in the future.
Previous wording
Construction of additional AN solution storage and new AN solution rail loading capability at our El Dorado Facility to significantly increase the volume of AN solution sales and increase product optionality at the site. We expect this project to be completed in the third quarter of 2025;
Current wording
Construction of additional AN solution storage and new AN solution rail loading capability at our El Dorado Facility to significantly increase the volume of AN solution sales and increase product optionality at the site. This project was completed during the second quarter of 2025;
Previous wording
Expansion of our urea capacity at our Pryor Facility, to enable to use a portion of the facility’s ammonia output to upgrade to approximately 75,000 additional tons of UAN per year. This project was completed in late 2024 and we expect it to lead to increased UAN sales volumes during 2025.
Current wording
Expansion of our urea capacity at our Pryor Facility, to enable us to use a portion of the facility’s ammonia output to upgrade to approximately 75,000 additional tons of UAN per year. This project was completed in late 2024 and led to increased UAN sales volumes during the first half of 2025.
Previous wording
The sequestered CO 2 generated from the facility’s ammonia production is expected to qualify for federal tax credits under Internal Revenue Code Section 45Q, which are $85 per metric ton of CO 2 captured and sequestered. Lapis, as the majority owner of the carbon capture and sequestration equipment, will earn the 45Q tax credits and will pay us a fee for each ton of CO 2 captured and sequestered by the end of 2026. Once in operation, the sequestered CO 2 is expected to reduce our overall scope 1 GHG emissions by approximately 25% from current levels. In addition, sequestering approximately 400,000 to 500,000 metric tons of CO 2 annually is expected to enable us to produce approximately 305,000 to 380,000 metric tons of low carbon ammonia annually, a product that could potentially be sold at higher price levels than conventional ammonia. In February 2023, a key milestone was achieved in the advancement of our low carbon ammonia project at El Dorado by filing a pre-construction Class VI permit application with the United States Environmental Protection Agency (the “EPA”). The EPA recognized the application as complete in March 2023 and is currently in the review process.
Current wording
The sequestered CO 2 generated from the facility’s ammonia production is expected to qualify for federal tax credits under Internal Revenue Code Section 45Q, which are $85 per metric ton of CO 2 captured and sequestered. Lapis, as the majority owner of the CCS equipment, will earn the 45Q tax credits and will pay us a fee for each ton of CO 2 captured and sequestered by the end of 2026. Once in operation, the sequestered CO 2 is expected to reduce our overall scope 1 GHG emissions by approximately 25% from current levels. In addition, sequestering approximately 400,000 to 500,000 metric tons of CO 2 annually is expected to enable us to produce approximately 305,000 to 380,000 metric tons of low carbon ammonia annually, a product that could potentially be sold at higher price levels than conventional ammonia. In February 2023, a key milestone was achieved in the advancement of our low carbon ammonia project at El Dorado by filing a pre-construction Class VI permit application with the United States Environmental Protection Agency (the “EPA”). The EPA recognized the application as complete in March 2023 and is currently in the review process. In June 2025, Lapis completed the drilling of a stratigraphic injection well at the El Dorado site and has been gathering data to support the EPA in its continuing technical review of our Class VI application. Once the project receives EPA approval, we intend to use this well for CO 2 injections.
Previous wording
Higher Ammonia Prices and AN and UAN Sales Volumes Offset by Higher Natural Gas Input Costs
Current wording
Higher UAN Prices and Higher AN and UAN Sales Volumes Offset by Higher Natural Gas Input Costs
Previous wording
First quarter 2025 results were impacted by natural gas input costs, which were higher than they were in the first quarter and full year of 2024. Partially offsetting the impact of higher natural gas prices were increased sales volumes of AN and UAN. Additionally, first quarter 2025 results benefited from higher ammonia prices relative to the prior year first quarter.
Current wording
Second quarter 2025 results were impacted by natural gas input costs, which were higher than they were in the second quarter and full year of 2024. Partially offsetting the impact of higher natural gas prices were increased sales volumes of AN and UAN. Additionally, second quarter 2025 results benefited from higher UAN prices relative to the prior year second quarter.
Previous wording
Ammonia prices have declined over the past several months, largely as a result of lower natural gas input costs in Europe, the global ammonia market’s marginal producer region. Lower European natural gas prices reflect expectations that Russia and Ukraine may reach a peace agreement following more than three years of armed conflict, which could lead to an increased flow of Russian natural gas into Europe. Ammonia prices may also be impacted by the start-up of new production capacity in both the United States and internationally, with at least one new world scale plant expected to come online during 2025.
Current wording
Ammonia prices currently reflect reduced supply from the Middle East, robust demand in the United States, and higher cost of production in Europe. Global ammonia inventories appear balanced, however, and as the year progresses, pricing may be impacted by the start-up of new production capacity in both the United States and internationally, with at least one new world scale plant expected to come online during 2025.
Previous wording
While ammonia prices have weakened over the past several months, pricing for ammonia derivative fertilizer products has been strong. Both urea and UAN prices are currently well above year-ago levels, reflecting a variety of factors including tight supply with limited inventory in the United States distribution channel; expectations for a strong Spring 2025 corn planting season with the USDA currently expecting 95 million acres of corn to be planted, up 5% from 2024; and tariffs on nitrogen fertilizers imported from countries outside of the United States, such as Trinidad, which are now being taxed at 10%.
Current wording
Pricing for ammonia derivative fertilizer products has been strong. Both urea and UAN prices are currently well above year-ago levels, reflecting a variety of factors including tight global supply with limited inventory in the United States distribution channel; the demand pull of a strong Spring 2025 corn planting season with the United States Department of Agriculture (“USDA”) currently expecting 95 million acres of corn to be planted, up 5% from the 2024 planting season; and a reduced pace of import flow into the United States.
Previous wording
Demand for our industrial products is stable despite global economic concerns. Nitric acid demand has been steady, reflecting the resilience of the U.S. economy and consumer spending levels. Demand for AN for use in mining applications has been bolstered by positive exposure to copper, gold and iron ore, as well as continued attractive market fundamentals for aggregate production relating to infrastructure construction. Economic uncertainty has recently been heightened by the potential impacts of tariffs on global trade flows, consumer prices and production input costs. However, we believe that we have a meaningful degree of downside protection in our industrial business given our diverse customer base which is almost entirely located in the United States, the nature of our contracts and our ability to shift our production mix to products where demand and pricing are strongest.
Current wording
Demand for our industrial products is stable despite global economic concerns. Nitric acid demand has been steady, reflecting the resilience of the U.S. economy and consumer spending levels. Demand for AN for use in mining applications has been bolstered by positive exposure to copper, gold and iron ore, as well as continued attractive market fundamentals for aggregate production relating to infrastructure construction. Economic uncertainty continues to be heightened by the potential impacts of tariffs on global trade flows, consumer prices and production input costs. However, we believe that we have a meaningful degree of downside protection in our industrial business given our diverse customer base which is almost entirely located in the United States, the nature of our contracts and our ability to shift our production mix to products where demand and pricing are strongest.
Previous wording
According to the World Agricultural Supply and Demand Estimates Report dated April 10, 2025 (the “April Report”), farmers planted approximately 90.6 million acres of corn in 2024, down 4.2% compared to the 2023 planting season. According to the April Report, the USDA estimates the United States ending stocks for the 2024 Harvest will be approximately 37.2 million metric tons, a 17.0% decrease from the 2023 Harvest. The USDA's expected yield for the 2024 Harvest is 179.3, up approximately 1.1% from a year ago.
Current wording
According to the World Agricultural Supply and Demand Estimates Report dated July 11, 2025 (the “July Report”), farmers planted approximately 95.2 million acres of corn in the 2025 planting season, up 5.1% compared to the 2024 planting season. According to the July Report, the USDA estimates the United States ending stocks for the 2025 Harvest will be approximately 42.2 million metric tons, a 24.1% increase from the 2024 Harvest. The USDA's expected yield per acre for the 2025 Harvest is 181.0 bushels, up approximately 0.9% from a year ago.
Previous wording
The current USDA corn outlook for the United States calls for increased exports, lower feed and residual use, and smaller ending stocks. Exports were raised 100 million bushels reflecting the pace of sales and shipments to date and relatively competitive U.S. prices. With no other use changes, ending stocks are down 75 million bushels from the previous month’s report. From a demand perspective, we believe that corn prices will remain at a level that will further support demand for fertilizers during 2025.
Current wording
The current USDA corn outlook for the United States calls for smaller supplies, domestic use, and ending stocks. Corn beginning stocks are down reflecting an increase in exports partly offset by lower feed and residual use. With supply falling more than use, ending stocks are down 90 million bushels from the previous month’s report. From a demand perspective, we believe that corn prices will remain at a level that will further support demand for fertilizers during the remainder of 2025.
Previous wording
The next ammonia plant Turnaround is currently planned for our El Dorado Facility in the first half of 2026. We completed Turnarounds at both our Pryor Facility and Cherokee Facility in the latter half of 2024. Following those Turnarounds, the next Pryor Facility Turnaround is currently planned for 2027, with the Cherokee Facility ammonia Turnaround currently planned for 2028.
Current wording
The next ammonia plant Turnaround is currently planned for our El Dorado Facility in the first half of 2026. We completed Turnarounds at both our Pryor Facility and Cherokee Facility in the latter half of 2024. Following those Turnarounds, the next Pryor Facility Turnaround is currently planned for 2027, with the Cherokee Facility Turnaround currently planned for 2028.
Previous wording
Consolidated Results of the First Quarter of 2025
Current wording
Consolidated Results of the Second Quarter of 2025
Previous wording
Our consolidated net sales for the first quarter of 2025 were $143.4 million compared to $138.2 million for the same period in 2024. Our consolidated operating income for the first quarter of 2025 was $4.5 million compared to $11.3 million for the same period in 2024. The items impacting our operating results are discussed in more detail below and under “Results of Operations.”
Current wording
Our consolidated net sales for the second quarter of 2025 were $151.3 million compared to $140.1 million for the same period in 2024. Our consolidated operating income for the second quarter of 2025 was $10.5 million compared to $14.4 million for the same period in 2024. The items impacting our operating results are discussed in more detail below and under “Results of Operations.”
Previous wording
Items Affecting Comparability of Results of the First Quarter
Current wording
Items Affecting Comparability of Results of the Second Quarter
Previous wording
For the first quarter of 2025, average selling prices for ammonia and AN increased while the average selling price for UAN decreased compared to the first quarter of 2024.
Current wording
For the second quarter of 2025, average selling prices for ammonia and UAN increased while the average selling price for AN and nitric acids decreased compared to the second quarter of 2024.
Previous wording
Gain on Extinguishment of Senior Secured Notes
Current wording
(Loss) Gain on Extinguishment of Senior Secured Notes
Previous wording
For the three months ended March 31, 2025 and 2024, we recorded asset write-downs primarily related to assets no longer in use in the amount of $0.1 million and $1.5 million, respectively. These write-downs are included in Other expense (income), net on our condensed consolidated statements of operations.
Current wording
For the three months ended June 30, 2025 and 2024, we recorded asset write-downs primarily related to assets no longer in use in the amount of $2.5 million and $1.5 million, respectively. These write-downs are included in “Other expense, net” on our condensed consolidated statements of operations.
Previous wording
The following table sets forth certain financial information, the increase or decrease between those periods, and the percentage increase or decrease between those periods with respect to each line item:
Current wording
The following table sets forth certain financial information for the three months ended June 30, 2025 and 2024, the increase or decrease between those periods, and the percentage increase or decrease between those periods with respect to each line item:
Previous wording
Net sales increased during the first quarter of 2025 compared to the prior year period driven by the impact of higher volumes for AN and UAN and improved pricing for AN and ammonia relative to the first quarter of 2024. Partially offsetting this increase was lower pricing for UAN and lower ammonia sales volumes.
Current wording
Net sales increased during the second quarter of 2025 compared to the prior year period driven by the impact of improved pricing for UAN and ammonia, as well as higher sales volumes for UAN and for our AN & Nitric Acid product group. Partially offsetting this increase were lower ammonia sales volumes and a lower average price within our AN & Nitric Acid product group.
Previous wording
As noted in the table above, we recognized a gross profit of $14.4 million for the first quarter of 2025 compared to $22.3 million for the same period in 2024, or a $7.9 million decrease. Overall, our gross profit percentage was 10.0% compared to 16.1% for the same period in 2024. Our adjusted gross profit percentage decreased to 25.4% for the first quarter of 2025 from 29.2% for the first quarter of 2024. Our overall gross profit for the first quarter of 2025 was lower compared to the same period of 2024 primarily due to higher natural gas costs, higher depreciation and turnaround expenses.
Current wording
As noted in the table above, we recognized a gross profit of $23.2 million for the second quarter of 2025 compared to $27.4 million for the same period in 2024, or a $4.2 million decrease. Overall, our gross profit percentage was 15.3% compared to 19.6% for the same period in 2024. Our adjusted gross profit percentage decreased to 30.7% for the second quarter of 2025 from 35.4% for the second quarter of 2024. Our gross profit for the second quarter of 2025 was lower compared to the same period of 2024 primarily due to higher natural gas costs and higher depreciation due to recent investments in our facilities. These cost increases were partially offset by higher net sales and lower Turnaround expenses.
Previous wording
Interest expense for the first quarter of 2025 was $8.1 million compared to $9.7 million for the same period in 2024. The decrease relates to lower outstanding balances on our Senior Secured Notes (due to repurchases) and our Secured Financing due 2025 (defined below) (due to repayments).
Current wording
Interest expense for the second quarter of 2025 was $7.9 million compared to $8.4 million for the same period in 2024. The decrease was primarily due to a lower outstanding balance on our Senior Secured Notes as a result of repurchases.
Previous wording
Non-operating other income, net for the first quarter of 2025 was $1.7 million compared to $3.6 million for the same period of 2024, primarily related to interest income earned during both periods from our short-term investments. Our average short-term investments balance was lower during the first quarter of 2025 compared to the first quarter of 2024.
Current wording
Non-operating other income, net for the second quarter of 2025 was $1.5 million compared to $2.9 million for the same period of 2024, primarily related to interest income earned during both periods from our short-term investments. Our average short-term investments balance including cash equivalents, was lower during the second quarter of 2025 compared to the second quarter of 2024.
Previous wording
The benefit for income taxes for the first quarter of 2025 was $0.3 million compared to a provision of $0.6 million for the same period of 2024. The resulting effective tax rate for the first quarter of 2025 was a benefit on pre-tax loss of 14.7% compared to a provision on pre-tax income of 9.7% for the same period of 2024. For the first quarter of 2025, the effective tax rate was lower than the statutory rate primarily due to changes in valuation allowance and nondeductible compensation, partially offset by state taxes. For the first quarter of 2024, the effective tax rate was lower than the statutory rate primarily due to nondeductible compensation and state taxes. See discussion in Note 7.
Current wording
The provision for income taxes for the second quarter of 2025 was $1.1 million compared to $1.3 million for the same period of 2024. The resulting effective tax rate for the second quarter of 2025 was a provision on pre-tax income of 26.5% compared to 11.6% for the same period of 2024. For the second quarter of 2025, the effective tax rate was higher than the statutory rate primarily due to nondeductible compensation expense and state taxes. For the second quarter of 2024, the effective tax rate is lower than the statutory rate primarily due to nondeductible compensation and deferred benefits from state tax law changes. See discussion in Note 7.
Previous wording
During the first quarter of 2024, we repurchased $32.9 million of our Senior Secured Notes due 2028 (the “Senior Secured Notes”) through open market transactions for approximately $31.3 million. As a result, we recognized a gain on extinguishment of debt, net of issuance costs, of approximately $1.1 million.
Current wording
During the first half of 2025, we repurchased $32.4 million in principal amount of our Senior Secured Notes for approximately $32.1 million, which was accounted for as an extinguishment of debt. Including our write-off of the associated remaining portion of unamortized debt issuance costs, we recognized a loss on extinguishment of debt of approximately $0.1 million. During the first half of 2024, we repurchased $96.6 million of our Senior Secured Notes through open market transactions for approximately $92.2 million. As a result, we recognized a gain on extinguishment of debt, net of issuance costs, of approximately $3.0 million.
Previous wording
Other (income), net for the first quarter of 2025 consisted primarily of short-term rental income from railcar subleases and other miscellaneous income, partially offset by asset write-downs. The write-downs and rental income were higher in 2024 compared to 2025.
Current wording
Other expense, net during the first half of 2025 and 2024 consisted primarily of asset write-downs related to assets no longer being used in operations. The asset write downs were lower in the first half of 2025 compared to the first half of 2024 while the write-downs in the first half of 2024 were partially offset by higher short-term rental income from railcar subleases.
Previous wording
The following table summarizes our cash flow activities for the three months ended March 31:
Current wording
The following table summarizes our cash flow activities for the six months ended June 30:
Previous wording
Net cash provided by operating activities was $6.8 million for the first three months of 2025 compared to $24.1 million for the same period of 2024, a change of $17.3 million. The decrease was primarily a result of higher cost of sales, changes in working capital and lower interest income on our short-term investments.
Current wording
Net cash provided by operating activities was $25.0 million for the first six months of 2025 compared to $65.5 million for the same period of 2024, a change of $40.5 million. The decrease was primarily a result of higher cost of sales, changes in working capital and lower interest income on our short-term investments.
Previous wording
For the first three months of 2024, the net cash provided primarily related to proceeds from short-term investments of $100.9 million, partially offset by purchases of short-term investments of $34.7 million and expenditures for property, plant and equipment of $18.3 million.
Current wording
For the first six months of 2025, the net cash provided by investing activities primarily related to proceeds from short-term investments of $154.6 million, partially offset by purchases of short-term investments of $110.3 million and expenditures for property, plant and equipment of $39.3 million.
Previous wording
For the first three months of 2025, the net cash used primarily related to purchases of short-term investments of $49.0 million and expenditures for property, plant and equipment of $20.9 million, partially offset by proceeds from short-term investments of $64.5 million.
Current wording
For the first six months ended 2024, the net cash provided by investing activities primarily related to proceeds from short-term investments of $236.5 million, partially offset by purchases of short-term investments of $34.7 million and expenditures for property, plant and equipment of $33.0 million.
Previous wording
For the first three months of 2025, the net cash used primarily consisted of payments on other long-term debt and short-term financing of $5.6 million and $1.2 million for tax withholding obligations related to the vesting of equity awards.
Current wording
For the first six months of 2025, the net cash used by financing activities primarily consisted of repurchases of our Senior Secured Notes of $32.1 million, payments on our Secured Financing due 2025 and short-term financing of $11.3 million and $1.2 million for tax withholding obligations related to the vesting of equity awards.
Previous wording
For the first three months of 2024, the net cash used primarily consisted of repurchases of our Senior Secured Notes of $31.3 million, payments on other long-term debt and short-term financing of $5.8 million, payments of $5.4 million for the purchase of treasury stock and $1.8 million for tax withholding obligations related to the vesting of equity awards.
Current wording
For the first six months of 2024, the net cash used by financing activities primarily consisted of repurchases of our Senior Secured Notes of $92.2 million, payments on our Secured Financing due 2025 and short-term financing of $11.8 million, repurchases of $12.0 million of common stock and $2.2 million for tax withholding obligations related to the vesting of equity awards.
Previous wording
We currently have a revolving credit facility pursuant to a credit agreement, dated December 21, 2023, between us and the lenders identified on the signature pages thereof and JPMorgan Chase Bank, N.A, as administrative agent (the “Revolving Credit Facility”), with a borrowing base up to an initial maximum of $75 million, with an option to increase the maximum by an additional $25 million (which amount is uncommitted). Availability under the Revolving Credit Facility is subject to a borrowing base and an availability block of $7.5 million which is applied against the $75 million initially reducing the maximum (which can be removed by us at our sole discretion, subject to the satisfaction of certain conditions). The Revolving Credit Facility provides for a sub-facility for the issuance of letters of credit in an aggregate amount not to exceed $10 million, with the outstanding amount of any such letters of credit reducing availability for borrowings. As of March 31, 2025, our Revolving Credit Facility was undrawn and had approximately $40 million of availability. See Note 4 for further discussion of the Revolving Credit Facility.
Current wording
We currently have a revolving credit facility pursuant to a credit agreement, dated December 21, 2023, between us and the lenders identified on the signature pages thereof and JPMorgan Chase Bank, N.A, as administrative agent (the “Revolving Credit Facility”), with a borrowing base up to an initial maximum of $75 million, with an option to increase the maximum by an additional $25 million (which amount is uncommitted). Availability under the Revolving Credit Facility is subject to a borrowing base and an availability block of $7.5 million which is applied against the $75 million initially reducing the maximum (which can be removed by us at our sole discretion, subject to the satisfaction of certain conditions). The Revolving Credit Facility provides for a sub-facility for the issuance of letters of credit in an aggregate amount not to exceed $10 million, with the outstanding amount of any such letters of credit reducing availability for borrowings. As of June 30, 2025, our Revolving Credit Facility was undrawn and had approximately $46 million of availability. See Note 4 for further discussion of the Revolving Credit Facility.
Previous wording
As of March 31, 2025, we had approximately $163.5 million of cash and short-term investments. From time to time, we may seek to deploy capital through common stock repurchases or the early redemption of outstanding debt. Such repurchases may be made in open market purchases, privately negotiated transactions or otherwise and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.
Current wording
As of June 30, 2025, we had approximately $124.9 million of cash and short-term investments. From time to time, we may seek to deploy capital through common stock repurchases or the early redemption of outstanding debt. Such repurchases may be made in open market purchases, privately negotiated transactions or otherwise and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.
Previous wording
We believe that the combination of our cash and cash equivalents, short-term investments, the availability under our Revolving Credit Facility and our cash flow from operations will be sufficient to fund our anticipated liquidity needs for the next twelve months.
Current wording
We believe that the combination of our cash and cash equivalents, short-term investments, the availability under our Revolving Credit Facility and our cash flow from operations will be sufficient to fund our anticipated liquidity needs for the next twelve months including the full repayment of the Secured Financing due 2025 in August 2025.
Previous wording
Senior Secured Notes due 2028 – LSB has $478.4 million aggregate principal amount of Senior Secured Notes outstanding as of March 31, 2025. Interest is to be paid semiannually in arrears on May 15 th and October 15 th. The Senior Secured Notes mature on October 15, 2028.
Current wording
Senior Secured Notes due 2028 – LSB had $446.1 million aggregate principal amount of Senior Secured Notes outstanding as of June 30, 2025. Interest is to be paid semiannually in arrears on May 15 th and October 15 th. The Senior Secured Notes mature on October 15, 2028.
Previous wording
Revolving Credit Facility –At March 31, 2025, our Revolving Credit Facility was undrawn and had approximately $40 million of availability, based on our eligible collateral, less outstanding letters of credit as of that date. Also see discussion above under “Compliance with Long-Term Debt Covenants.”
Current wording
Revolving Credit Facility –At June 30, 2025, our Revolving Credit Facility was undrawn and had approximately $46 million of availability, based on our eligible collateral, less outstanding letters of credit as of that date. Also see discussion above under “Compliance with Long-Term Debt Covenants.”
Previous wording
For the first three months of 2025, capital expenditures relating to property, plant and equipment were $20.9 million. The capital expenditures were funded primarily from cash and working capital.
Current wording
For the first six months of 2025, capital expenditures relating to property, plant and equipment were $39.3 million. The capital expenditures were funded primarily from cash and working capital.
Previous wording
See discussion above under “Capitalization” for our total expected capital expenditures for 2025.
Current wording
See discussion above under “Capitalization” for our total expected capital expenditures for the remainder of 2025.
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Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
Represents a non-GAAP measure since the amount excludes unallocated depreciation, amortization and Turnaround expenses.
Current report — wording carried from elsewhere
Represents amount classified as cost of sales.
Current report — wording carried from elsewhere
As a percentage of the total net sales.
Current report — wording carried from elsewhere
The following tables provide key operating metrics for the fertilizer and major industrial products, the increase or decrease between those periods, and the percentage increase or decrease between those periods with respect to each line item:
Current report — wording carried from elsewhere
Non-operating other income, net for the first half of 2025 was $3.2 million compared to $6.5 million for the same period of 2024, primarily related to interest income earned during both periods from our short-term investments.
Current report — wording carried from elsewhere
The provision for income taxes for the first half of 2025 was $0.8 million compared to $1.9 million for the same period of 2024. The resulting effective tax rate for the first half 2025 was 37.0% compared to 10.9% for the same period of 2024. For the first half of 2025, the effective tax rate is higher than the statutory rate primarily due to nondeductible compensation expense and state taxes. For the first half of 2024, the effective tax rate is lower than the statutory rate primarily due to nondeductible compensation and deferred benefits from state tax law changes. See discussion in Note 7.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
During the first quarter of 2024, we repurchased $32.9 million of our Senior Secured Notes through open market transactions for approximately $31.3 million. As a result, we recognized a gain on extinguishment of debt, net of issuance costs, of approximately $1.1 million.
Previous report — wording carried elsewhere
During the three months ended March 31, 2025, we did not repurchase any of our shares of common stock. The repurchase program may be suspended, terminated or modified at any time for any reason.
Previous report — wording carried elsewhere
During the three months ended March 31, 2025, we did not repurchase any of our Senior Secured Notes.