Intrepid Potash Inc
For the period ended Sep 30, 2024. Filed Nov 5, 2024.
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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.
Sep 30, 2024 · Filed Nov 5, 2024
IPI$32.90+4.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-06.
0001421461-24-000027
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-05.
0001421461-24-000032
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 180 previous paragraphs and 184 current paragraphs.
92 unchanged; 64 reworded; 28 added; 22 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 8 previous and 8 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 (28)
Current report
Recent Developments
Current report
On April 16, 2024, our Board granted Robert P. Jornayvaz III, our Executive Chairman of the Board and Chief Executive Officer, a temporary medical leave of absence, as he recovered from a non-work related accident. In connection with Mr. Jornayvaz’s medical leave, the Board temporarily delegated all responsibilities of the Chairman of the Board to Barth Whitham, Lead Director. In addition, the Board appointed Matthew D. Preston, the Company’s Chief Financial Officer, as acting principal executive officer of the Company. The Board also appointed Hugh E. Harvey, our co-founder with Mr. Jornayvaz, to serve as a Class III director on the Board. Subsequently, on July 10, 2024, our Board announced that it was unlikely that Mr. Jornayvaz would return from his extended medical leave of absence and it had initiated a search process to identify a successor to Mr. Jornayvaz in the Chief Executive Officer role. The Board also elected Mr. Whitham, formerly Lead Independent Director, as its Chair.
Current report
On September 30, 2024, Mr. Jornayvaz resigned as Chief Executive Officer and as a member of the Board. The search process to identify a successor to Mr. Jornayvaz as Chief Executive Officer continues and Mr. Preston continues as acting principal executive officer of the Company until a permanent Chief Executive Office is appointed by the Board.
Current report
•Water sales. In the three and nine months ended September 30, 2024, total water sales were $7.9 million and $12.7 million, respectively, compared to $2.5 million and $9.4 million during the same periods of 2023. Sales increased in the third quarter of 2024 compared to the prior year as we supplied and sourced water for a frac on our South ranch. Year-to-date water sales increased compared to the prior year due to the frac during the third quarter, offset by less water sold from our Caprock water rights as we maximize injection rates at our HB mine. We expect our water sales in the fourth quarter of 2024 will decrease towards the rates seen in the first half of 2024, as we do not forecast any frac demand on our South ranch. We continue to pursue opportunities to supply or source water for additional fracs on our South ranch, although the timing of those opportunities, if any, is uncertain.
Current report
We expect our brine injection rates will increase to between 2,000 - 2,500 gallons per minute, the highest rate in company history, which will improve the brine availability and residence time in the HB cavern system.
Current report
–HB AMAX Cavern - In the third quarter of 2024, we started the permitting process to drill a sample well into the AMAX Cavern at HB in order to measure the brine chemistry of the existing cavern. AMAX is the largest cavern in the HB system and is expected to serve as an expansion area to the original HB caverns which have been in service for over ten years. We expect to finish the sample well permitting process in the first quarter of 2025 with test well drilling taking place shortly thereafter.
Current report
1 Sales include sales of byproducts which were $6.7 million and $7.0 million for the three months ended September 30, 2024, and 2023, respectively, and $18.1 million and $21.3 million for the nine months ended September 30, 2024, and 2023, respectively.
Current report
Our total sales for the three months ended September 30, 2024, increased $3.1 million, or 6%, compared to the same period in 2023, as oilfield solutions segment sales increased $5.4 million and potash segment sales increased $0.8 million, partially offset by a decrease of $3.1 million in Trio® segment sales.
Current report
Our oilfield solutions segment sales, which includes sales of water, brine water, surface use, and easements, increased $5.4 million, or 111%, in the three months ended September 30, 2024, compared to the same period in 2023, driven by a $6.8 million increase in water sales, partially offset by a $1.4 million decrease in surface use and easement revenues. Our oilfield solutions segment water revenues increased due to the completion of a large frac on Intrepid South during the third quarter of 2024. Surface use and easement revenues fluctuate based on the timing of recognizing revenue from the various performance obligations contained in the underlying agreements.
Current report
Our total potash segment sales increased $0.8 million for the three months ended September 30, 2024, compared to the same period in 2023, as potash segment byproduct sales increased $1.0 million, partially offset by a $0.3 million decrease in potash sales. During the three months ended September 30, 2024, potash segment byproduct sales increased, compared to the same period in 2023, due to an increase in brine water sales driven by continued strong demand from oil and gas operators near our facilities in New Mexico. While we sold 17% more tons of potash during the three months ended September 30, 2024, compared to the same period in 2023, our average net realized sales price per ton decreased 18%.
Current report
Our potash segment cost of goods sold increased $0.1 million, or 1%, during the three months ended September 30, 2024, compared to the same period in 2023. While we sold 17% more tons of potash in the three months ended September 30, 2024, compared to the same period in 2023, our beginning of the third quarter 2024 potash weighted average carrying cost per ton decreased due to lower of cost or net realizable value inventory adjustments recorded during the first six months of 2024. Additionally, we produced 19% more tons of potash during the three months ended September 30, 2024, compared to the same period during 2023, which lowered our per ton production costs. A significant portion of our production costs are fixed and an increase in the number of potash tons produced decreases our per ton production costs.
Current report
Our oilfield solutions cost of goods sold increased $3.7 million, or 105%, during the three months ended September 30, 2024, compared to the same period in 2023, as we purchased more third-party water to sell for the large frac job that was completed at Intrepid South during the third quarter of 2024.
Current report
Our total cost of goods sold decreased $12.7 million during the nine months ended September 30, 2024, compared to the same period in 2023. Our potash segment cost of goods sold decreased $12.9 million, and our Trio®segment cost of goods sold decreased $2.7 million, partially offset by an increase of $2.9 million in our oilfield solutions cost of goods sold.
Current report
Our potash segment cost of goods sold decreased $12.9 million, or 16%, mainly due to selling 14% fewer tons in the nine months ended September 30, 2024, compared to the same period in 2023.
Current report
Our oilfield solutions cost of goods sold increased $2.9 million, or 26%, during the nine months ended September 30, 2024, compared to the same period in 2023, mainly due to our purchasing more third-party water for resale to meet the demand for a large frac on Intrepid South.
Current report
1 Sales include sales of byproducts which were $6.7 million and $5.6 million for the three months ended September 30, 2024, and 2023, respectively, and $17.7 million and $17.1 million for the nine months ended September 30, 2024, and 2023, respectively.
Current report
Our total sales in the potash segment increased $0.8 million in the three months ended September 30, 2024, compared to the same period in 2023, as potash segment byproduct sales increased $1.0 million, partially offset by a $0.3 million decrease in potash sales. Our potash segment byproduct sales increased due to an increase in brine sales as we sold more barrels of brine at a higher average price during the three months ended September 30, 2024, compared to the same period in 2023, due to continued robust oilfield activity near our mines in New Mexico.
Current report
Our potash segment cost of goods sold increased $0.1 million, or 1%, during the three months ended September 30, 2024, compared to the same period in 2023. While we sold 17% more tons of potash in the three months ended September 30, 2024, compared to the same period in 2023, our beginning of the third quarter 2024 potash weighted average carrying cost per ton decreased due to lower of cost or net realizable value inventory adjustments recorded during the first six months of 2024. Additionally, we produced 19% more tons of potash during the three months ended September 30, 2024, compared to the same period during 2023, which lowered our per ton production costs. A significant portion of our production costs are fixed and an increase in the number of potash tons produced decreases our per ton production costs.
Current report
Byproduct sales recorded in our potash segment during the nine months ended September 30, 2024, compared to the same period in 2023, increased $0.6 million as brine sales increased $1.9 million, partially offset by a $1.4 million decrease in magnesium chloride sales. Brine sales increased during the nine months ended September 30, 2024, as we sold more barrels of brine at a higher average price compared to the prior year period due to continued oilfield activity near our mines. Magnesium chloride sales declined during the nine months ended September 30, 2024, due to mild winter weather which decreased demand for our deicing product in the first quarter of 2024, and we saw less demand from the dedust market impacting sales in the second and third quarters of 2024.
Current report
Our potash segment cost of goods sold decreased 16% in the first nine months of 2024, compared to the same period in 2023, mainly due to selling 14% fewer tons of potash.
Current report
1 Sales include sales of byproducts which were $0.0 million and $1.4 million for the three months ended September 30, 2024, and 2023, respectively, and $0.4 million and $4.2 million for the nine months ended September 30, 2024, and 2023, respectively.
Current report
Trio® segment sales decreased 14% during the three months ended September 30, 2024, compared to the same period in 2023. Trio® sales decreased $1.7 million, and our Trio® segment byproduct sales decreased $1.4 million. Trio® sales decreased primarily due to a 13% decrease in tons sold, partially offset by a 5% increase in our average net realized sales price per ton. Our average net realized sales price per ton increased during the three months ended September 30, 2024, compared to the same period in 2023, as Trio®prices for the 2024 summer fill program were $15 per ton higher than the 2023 summer fill program prices. Also, we sold fewer tons internationally during the three months ended September 30, 2024, compared to the same period in 2023. Generally, we incur more freight expense on international sales compared to domestic sales, which decreases our average net realized sales price per ton.
Current report
Our Trio® segment byproduct sales decreased $1.4 million in the three months ended September 30, 2024, compared to the same period in 2023, due to a decrease in Trio® segment byproduct water sales. During the three months ended September 30, 2024, we did not sell any byproduct water as we increased the volume of water used for injection at our HB plant.
Current report
Our Trio®segment generated gross margin of $0.6 million in the three months ended September 30, 2024, compared to gross deficit of $4.3 million in the three months ended September 30, 2023, mainly due to the decrease in Trio® cost of goods sold.
Current report
Our oilfield solutions segment sales increased $5.4 million in the three months ended September 30, 2024, compared to the same period in 2023, due to a $6.8 million increase in water sales, partially offset by a $1.3 million decrease in sales of other oilfield solution products and services. Our water sales increased during the three months ended September 30, 2024, compared to the same period in 2023, due to the completion of a large frac at Intrepid South. Our sales of other oilfield solution products and services decreased during the three months ended September 30, 2024, compared to the same period in 2023, as we recognized less revenues from surface use and easement agreements. Surface use and easement revenues fluctuate based on the timing of recognizing revenue from the various performance obligations contained in the underlying agreements.
Current report
Our cost of goods sold increased $3.7 million, or 105%, in the three months ended September 30, 2024, compared to the same period in 2023, as we purchased more third-party water for resale to meet the demand for a large frac on Intrepid South.
Current report
Our cost of goods sold increased $2.9 million, or 26%, in the nine months ended September 30, 2024, compared to the same period in 2023, as we purchased more third-party water for resale to meet the demand for a large frac on Intrepid South during the third quarter of 2024.
Current report
As of September 30, 2024, we continue to be in a three-year cumulative income position. However, losses incurred in 2023 and through the first nine-months of 2024 have reduced the amount of three-year cumulative income. If weakness in fertilizer pricing, lower production, additional impairments, or additional losses were to continue, it is possible that there may be significant negative evidence to cause us to record a valuation allowance within the next 12 months. The timing and amount of any valuation allowance is subject to significant judgement that is considered with the timing and amounts of actual and future earnings. Recording any valuation allowance would result in increased income tax expense in the period the valuation allowance is recorded which could have a material effect on net income.
Removed paragraphs (22)
Previous report
•Water sales. In the three and six months ended June 30, 2024, total water sales were $2.6 million and $4.7 million, respectively, compared to $4.1 million and $6.9 million during the same periods of 2023. Water sales decreased compared to the prior year due to less water sold from our Caprock water rights as we maximize injection rates at our HB mine and less water sold on our South ranch due to timing of fracs and increased demand for our brine water.
Previous report
–We commissioned a new extraction well at our HB Solar Solution Mine, IP30B, in June 2024. This new extraction well is designed to have a long-term operational life and will initially target approximately 330 million gallons of high-grade brine from the Eddy Cavern at the HB mine, with this additional brine being at lower depths than the Eddy Shaft project can access.
Previous report
• Diversification of products and services. In addition to the products discussed above, we generate revenue from right-of-way agreements, surface damages and easements, caliche sales, a produced water royalty, and sales of cattle.
Previous report
1 Sales include sales of byproducts which were $6.0 million and $7.7 million for the three months ended June 30, 2024, and 2023, respectively, and $11.4 million and $14.2 million for the six months ended June 30, 2024, and 2023, respectively.
Previous report
Our total sales for the three months ended June 30, 2024 decreased $19.0 million, or 23%, compared to the same period in 2023, as potash segment sales decreased $17.2 million, or 36%, Trio® segment sales decreased by $2.2 million, or 8%, partially offset by a $0.4 million, or 8%, increase in oilfield solutions segment sales.
Previous report
Our total potash segment sales decreased $17.2 million for the three months ended June 30, 2024 compared to the same period in 2023, as potash sales decreased $16.9 million and potash segment byproduct sales decreased $0.3 million. Our average net realized sales price per potash ton decreased 15%, and we sold 30% fewer tons. Potash prices declined during 2024, compared to 2023, as global production rates and available inventory have improved. Potash tons sold decreased compared to the prior year because we had fewer tons of potash available to sell due to reduced production rates at our HB and Wendover facilities.
Previous report
Our potash segment cost of goods sold decreased $7.2 million, or 25%, mainly due to selling 30% fewer tons in the three months ended June 30, 2024, compared to the same period in 2023.
Previous report
Our oilfield solutions cost of goods sold decreased $0.4 million, or 11%, during the three months ended June 30, 2024, compared to the same period in 2023, due to a decrease in labor expenses, partially offset by an increase in royalty expense due to an increase in sales revenue.
Previous report
Impairment Expense
Previous report
Our total cost of goods sold decreased $11.1 million during the first half of 2024, compared to the first half of 2023. Our potash cost of goods sold decreased $13.0 million, our oilfield solutions cost of goods sold decreased by $0.9 million, partially offset by a $2.8 million increase in our Trio®cost of goods sold.
Previous report
Our potash segment cost of goods sold decreased $13.0 million, or 22%, mainly due to selling 23% fewer tons in the first half of 2024, compared to the first half of 2023.
Previous report
Our oilfield solutions cost of goods sold decreased $0.9 million, or 11%, during the first half of 2024, compared to the first half of 2023, mainly due to a decrease in contract labor expenses.
Previous report
Impairment Expense
Previous report
1 Sales include sales of byproducts which were $5.9 million and $6.2 million for the three months ended June 30, 2024, and 2023, respectively, and $11.1 million and $11.5 million for the six months ended June 30, 2024, and 2023, respectively.
Previous report
Our potash segment cost of goods sold decreased 25% in the second quarter of 2024, compared to the second quarter of 2023, as we sold 30% fewer tons of potash.
Previous report
Our potash segment cost of goods sold decreased 22% in the first half of 2024, compared to the first half of 2023, mainly due to selling 23% fewer tons of potash.
Previous report
1 Sales include sales of byproducts which were $0.1 million and $1.5 million for the three months ended June 30, 2024, and 2023, respectively, and $0.3 million and $2.7 million for the six months ended June 30, 2024, and 2023, respectively.
Previous report
Our Trio® segment byproduct sales decreased $1.4 million in the three months ended June 30, 2024, compared to the same period in 2023, due to a decrease in Trio® segment byproduct water sales. We sold less byproduct water as we increased the volume of water used for injection at our HB plant and had fewer overall sales of water from our Caprock water rights. Generally, we source our water sales closer to the location where the customer needs the water to minimize water transfer costs.
Previous report
Our Trio®segment experienced a gross margin of $2.2 million in the three months ended June 30, 2024, compared to gross margin of $1.2 million in the three months ended June 30, 2023, mainly due to the decrease in our Trio® cost of goods sold.
Previous report
Our oilfield solutions segment sales increased $0.4 million in the three months ended June 30, 2024, compared to the same period in 2023, due to a $0.3 million increase in other oilfield solution products and services and a $0.2 million increase in brine water sales.
Previous report
Our cost of goods sold decreased $0.4 million, or 11%, in the three months ended June 30, 2024, compared to the same period in 2023, due to using less contract labor. In the three months ended June 30, 2023, we used contract labor to complete various projects at Intrepid South.
Previous report
Our cost of goods sold decreased $0.9 million, or 11%, in the six months ended June 30, 2024, compared to the same period in 2023, due to using less contract labor. In the six months ended June 30, 2023, we used contract labor to complete various projects at Intrepid South.
Reworded paragraphs (64)
Previous wording
•Potash pricing and demand. Our potash average net realized sales price per ton(1) decreased to $405 and $399 for the three and six months ended June 30, 2024, respectively, compared to $479 and $485, respectively, for the same periods in 2023. Sales volume declined 30% and 23% in the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023 as we had less inventory to sell because of lower production at our HB and Wendover facilities. In June 2024, a summer-fill agricultural potash program was announced decreasing the corn belt reference price to $335 per ton during a ten-day order window for delivery during the third quarter of 2024. After the ten-day order window closed, the list price increased by $20 per ton for spot orders.
Current wording
•Potash pricing and demand. Our potash average net realized sales price per ton(1) decreased to $356 and $387 for the three and nine months ended September 30, 2024, respectively, compared to $433 and $474, respectively, for the same periods in 2023. Sales volume declined 14% in the nine months ended September 30, 2024, compared to the same period in 2023 as we had less inventory to begin the year due to decreased production at our HB and Wendover facilities combined with strong demand during the fall 2023 season. Since the summer-fill program was announced in June 2024, Corn Belt pricing has remained at summer-fill levels due to sufficient inventory and limited buying to test market values.
Previous wording
•Trio® pricing and demand. Our Trio® average net realized sales price per ton(1) decreased to $314 and $306 for the three and six months ended June 30, 2024, respectively, compared to $333 and $339, respectively, for the same periods in 2023. Sales volumes in the six months ended June 30, 2024 increased 20% compared to the same period in 2023 on supportive sulfate values and better than expected late season demand into row crop markets. In response to recent price decreases in potash and sulfate products, in late July, we announced a Trio® summer-fill program which reduced the Carlsbad posted price by $25 per ton during a one week order window for delivery during the third quarter of 2024. After the order window closes, the Carlsbad posted price increased by $15 per ton for spot orders.
Current wording
•Trio® pricing and demand. Our Trio® average net realized sales price per ton(1) increased to $312 and decreased to $305 for the three and nine months ended September 30, 2024, respectively, compared to $298 and $329, respectively, for the same periods in 2023. Sales volumes in the nine months ended September 30, 2024, increased 12% compared to the same period in 2023 on supportive sulfate values and better than expected late season demand into row crop markets during the first half of 2024. In July, we announced a Trio® summer-fill program which reduced the Carlsbad posted price by $25 per ton during a one-week order window for delivery during the third quarter of 2024. After the order window closed, the Carlsbad posted price increased by $15 per ton for spot orders.
Previous wording
•Byproduct sales. We sell byproducts such as salt, magnesium chloride, brines, and water that are derived from our potash and Trio® operations. Byproduct sales were $6.0 million during the second quarter of 2024, compared to $7.7 million for the same period of 2023. Byproduct sales were $11.4 million during the first half of 2024, compared to $14.2 million for the same period of 2023 as increased brine sales were offset by decreased sales of magnesium chloride and water. We expect minimal, if any, byproduct sales of water in the second half of 2024 as we continue to maximize injection rates at our HB mine.
Current wording
•Byproduct sales. We sell byproducts such as salt, magnesium chloride, brines, and water that are derived from our potash and Trio® operations. Byproduct sales were $6.7 million during the third quarter of 2024, compared to $7.0 million for the same period of 2023. Byproduct sales were $18.1 million during the first nine months of 2024, compared to $21.3 million for the same period of 2023 as increased brine sales were offset by decreased sales of magnesium chloride and water. We expect minimal, if any, byproduct sales of water for the remainder of 2024 as we continue to maximize injection rates at our HB mine.
Previous wording
–Phase Two of the HB Injection Pipeline Project is the installation of an in-line pigging system to clean the pipeline and remove scaling to help ensure more consistent flow rates. All pipeline was installed and tanks were set, and we expect to commission the project in the third quarter of 2023.
Current wording
–Phase Two of the HB Injection Pipeline Project - The in-line pigging system to clean the new pipeline and remove scaling to help ensure more consistent flow rates was commissioned in the third quarter to all brine injection sites.
Previous wording
–We completed the construction of a new primary pond in Wendover in June 2024 and are in the process of filling the pond with brine. Similar to our caverns at the Moab and HB mines, the primary ponds at Wendover serve as the brine storage area, and adding another primary pond will help us meet our goals of maximizing brine availability, increasing brine grade, and improving production. We expect to see the production benefits of the new primary pond beginning in the fall of 2025.
Current wording
–We completed the construction of a new primary pond in Wendover in June 2024 and are in the process of filling the pond with brine. Similar to our caverns at the Moab and HB mines, the primary ponds at Wendover serve as the brine storage area, and adding another primary pond will help us meet our goals of maximizing brine availability, increasing brine grade, and improving production. We expect to see the production benefits of the new primary pond beginning in 2025 - 2026 production year.
Previous wording
Our Trio®segment sales decreased $2.2 million in the three months ended June 30, 2024, compared to the same period in 2023, as Trio®sales decreased $0.8 million, or 3%, and Trio®segment byproduct water sales decreased $1.5 million. Our Trio®average net realized sales price per ton decreased 6% in the three months ended June 30, 2024, compared to the same period in 2023, while Trio®tons sold were unchanged. Trio®prices fell as potash prices declined. We sold less Trio®segment byproduct water as we increased the volume of water used for injection at our HB plant and had fewer overall sales of water from our Caprock water rights.
Current wording
Our Trio®segment sales decreased $3.1 million in the three months ended September 30, 2024, compared to the same period in 2023, as Trio®sales decreased $1.7 million, or 8%, and Trio®segment byproduct water sales decreased $1.4 million. While our Trio®average net realized sales price per ton increased 5% in the three months ended September 30, 2024, compared to the same period in 2023, we sold 13% fewer tons. We sold less Trio®segment byproduct water as we increased the volume of water used for injection at our HB plant and we sold fewer barrels of water from our Caprock water rights.
Previous wording
Our total byproduct sales, which are recorded in either our potash segment or Trio® segment, decreased $1.7 million in the three months ended June 30, 2024, compared to the same period in 2023, due to a decrease in byproduct water sales. We did not sell any byproduct water as we increased the volume of water used for injection at our HB plant and had fewer overall sales of water from our Caprock water rights.
Current wording
Our total byproduct sales, which are recorded in either our potash segment or Trio® segment, decreased $0.4 million in the three months ended September 30, 2024, compared to the same period in 2023, due to a decrease in byproduct water sales. We did not sell any byproduct water during the three months ended September 30, 2024, as we increased the volume of water used for injection at our HB plant and we sold fewer barrels of water from our Caprock water rights.
Previous wording
Our total cost of goods sold decreased $11.3 million during the three months ended June 30, 2024, compared to the same period in 2023. Our potash cost of goods sold decreased $7.2 million combined with a $3.6 million decrease in Trio®cost of goods sold and a $0.4 million decrease in our oilfield solutions cost of goods sold.
Current wording
Our total cost of goods sold decreased $1.7 million during the three months ended September 30, 2024, compared to the same period in 2023, as Trio®segment cost of goods sold decreased $5.5 million, partially offset by a $3.7 million increase in our oilfield solutions cost of goods sold and a $0.1 million increase in our potash segment cost of goods sold.
Previous wording
Our Trio® segment cost of goods sold decreased $3.6 million, or 18%, during the three months ended June 30, 2024, compared to the same period in 2023, although tons sold were flat. Our Trio®cost of goods sold was positively impacted by decreases in certain production costs, such as production labor and benefits expense, as we stopped operating an additional underground shift in early 2024 at our East facility and restarted our fine langbeinite recovery process in March 2024. In addition, we produced 17% more tons of Trio®in the three months ended June 30, 2024, compared to the same period in 2023, which lowered our per ton production costs. A significant portion of our Trio®production costs are fixed and an increase in tons produced decreases our per ton production costs.
Current wording
Our Trio® segment cost of goods sold decreased $5.5 million, or 31%, during the three months ended September 30, 2024, compared to the same period in 2023, because we sold 13% fewer tons, and we incurred less production expenses. Our Trio®labor expenses decreased because we stopped operating an additional underground shift at our East mine during the first quarter of 2024, and our depreciation expense incurred decreased as we recorded an impairment of our Trio®segment assets during the fourth quarter of 2023. In addition, we produced 19% more tons of Trio®in the three months ended September 30, 2024, compared to the same period in 2023, which lowered our per ton production costs. A significant portion of our Trio®production costs are fixed and an increase in the number of tons produced decreases our per ton production costs.
Previous wording
In the three months ended June 30, 2024, we incurred $1.4 million of lower of cost or net realizable value inventory adjustments in our potash segment, as our weighted average carrying costs for certain potash products exceeded our expected average net realized sales price for those products. We did not incur any lower of cost or net realizable value inventory adjustments in the three months ended June 30, 2023.
Current wording
In the three months ended September 30, 2024, we incurred $0.5 million of lower of cost or net realizable value inventory adjustments in our potash segment, as our weighted average carrying costs for certain potash products exceeded our expected average net realized sales price for those products. We incurred $3.4 million in lower of cost or net realizable value inventory adjustments related to potash and Trio®products in the three months ended September 30, 2023.
Previous wording
During the three months ended June 30, 2024, we generated gross margin of $7.6 million compared to gross margin of $15.4 million during the same period in 2023. As discussed above, our gross margin decreased due to the lower average net realized sales price per ton for potash and Trio®products. In addition, we sold fewer tons of potash in the second quarter of 2024, compared to the second quarter of 2023. Also, we recorded $1.4 million of lower of cost or net realizable value inventory adjustments for potash during the three months ended June 30, 2024.
Current wording
During the three months ended September 30, 2024, we generated gross margin of $7.7 million compared to gross margin of $0.5 million during the same period in 2023. As discussed above, our gross margin increased during the three months ended September 30, 2024, due to improved Trio® segment cost of goods sold and increased sales in our oilfield solutions segment.
Previous wording
During the year ended December 31, 2023, we recorded an impairment related to our Trio®segment assets because the net book value exceeded the estimated fair value of the assets. The fair value of the Trio®segment assets was primarily determined using the expected proceeds received in an orderly sale of the individual assets. For any Trio®segment capital spending during the six months ended June 30, 2024, we also estimated the fair value of those assets using the expected proceeds received in an orderly sale of those new assets and recorded an impairment of $2.2 million.
Current wording
During the year ended December 31, 2023, we recorded an impairment related to our Trio®segment assets because the net book value exceeded the estimated fair value of the assets. The fair value of the Trio®segment assets was primarily determined using the expected proceeds received in an orderly sale of the individual assets. For any Trio®segment capital spending during the three months ended September 30, 2024, we also estimated the fair value of those assets using the expected proceeds received in an orderly sale of those new assets and recorded an impairment of $0.9 million in the three months ended September 30, 2024. We recorded a $0.5 million impairment related to our non-operating working interest in an oil and gas well during the three months ended September 30, 2023.
Previous wording
Other operating income increased $0.8 million in the second quarter of 2024, compared to the second quarter of 2023, due to other operating income recorded related to the Third Amendment to the Cooperative Development Agreement (the "Amendment") we signed with XTO in December 2023, that became effective as of January 1, 2024. As discussed in further detail in Footnote 7 - Other Long-term Deferred Income to the Condensed Consolidated Financial Statements, we are recognizing as other operating income the estimated transaction price associated with the Amendment on a straight-line basis over the term of the Amendment.
Current wording
Other operating income increased $0.8 million during the three months ended September 30, 2024, compared to the same period in 2023 due to other operating income recorded related to the Third Amendment to the Cooperative Development Agreement (the "Amendment") we signed with XTO in December 2023, that became effective as of January 1, 2024. As discussed in further detail in Note 7 - Other Long-term Deferred Income to the Condensed Consolidated Financial Statements, we are recognizing as other operating income the estimated transaction price associated with the Amendment on a straight-line basis over the term of the Amendment.
Previous wording
During the three months ended June 30, 2024, we incurred income tax benefit of $0.3 million, compared to income tax expense of $2.0 million during the same period in 2023, as we incurred a net loss during the three months ended June 30, 2024, compared to net income in the same period in 2023.
Current wording
During the three months ended September 30, 2024, we realized an immaterial amount of income tax benefit compared to income tax benefit of $1.9 million during the same period in 2023, as we generated a smaller net loss during the three months ended September 30, 2024, than during the same period in 2023.
Previous wording
We generated a net loss of $0.8 million during the three months ended June 30, 2024, compared to net income of $4.3 million in the same period 2023, due to the factors discussed above.
Current wording
We generated a net loss of $1.8 million during the three months ended September 30, 2024, compared to a net loss of $7.2 million in the same period in 2023, due to the factors discussed above.
Previous wording
Consolidated Results for the Six Months Ended June 30, 2024, and 2023
Current wording
Consolidated Results for the Nine Months Ended September 30, 2024, and 2023
Previous wording
Our total sales for the six months ended June 30, 2024 decreased $26.6 million, or 16%, compared to the same period in 2023, as potash segment sales decreased $32.2 million, or 32%, partially offset by a $4.0 million, or 7%, increase in Trio® segment sales and a $1.5 million, or 16%, increase in oilfield solutions segment sales.
Current wording
Our total sales for the nine months ended September 30, 2024 decreased $23.5 million, or 11%, compared to the same period in 2023, as potash segment sales decreased $31.4 million, or 25%, partially offset by a $6.9 million, or 49%, increase in oilfield solutions segment sales and a $0.9 million, or 1%, increase in Trio® segment sales.
Previous wording
Our total potash segment sales decreased $32.2 million for the six months ended June 30, 2024, compared to the same period in 2023, as potash sales decreased $31.7 million and potash segment byproduct revenues decreased $0.4 million. Our average net realized sales price per potash ton decreased 18% and we sold 23% fewer tons. Potash sales prices have been pressured during 2024 by increased global potash inventory levels. Potash tons sold decreased compared to the prior year because we began 2024 with fewer tons of potash available to sell due to decreased potash production from our HB and Wendover facilities in the second half of 2023.
Current wording
Our total potash segment sales decreased $31.4 million for the nine months ended September 30, 2024, compared to the same period in 2023, as potash sales decreased $31.9 million partially offset by an increase of $0.6 million in potash segment byproduct revenues. Our average net realized sales price per potash ton decreased 18% and we sold 14% fewer tons. Potash sales prices have been pressured during 2024 by increased global potash inventory levels. Potash tons sold decreased compared to the prior year because we began 2024 with fewer tons of potash available to sell due to decreased potash production from our HB and Wendover facilities in the second half of 2023.
Previous wording
Our Trio®segment sales increased $4.0 million in the six months ended June 30, 2024, compared to the same period in 2023, as Trio®sales increased $6.4 million, or 11%, partially offset by a $2.5 million decrease in Trio®segment byproduct water sales. We sold 20% more tons of Trio® in the six months ended June 30, 2024, compared to the same period in 2023, partially offset by a 10% decrease in our Trio®average net realized sales price per ton. Our Trio®tons sold increased during the six months ended June 30, 2024, compared to the same period in 2023, as we sold more Trio®tons into row crop markets, particularly driven by the sulfate value of Trio®. During the first half of 2024, Trio®prices have declined as potash prices also declined. We sold less Trio®segment byproduct water as we increased the volume of water used for injection at our HB plant and had fewer overall sales of water from our Caprock water rights.
Current wording
Our Trio®segment sales increased $0.9 million in the nine months ended September 30, 2024, compared to the same period in 2023, as Trio®sales increased $4.7 million, or 6%, partially offset by a $3.9 million decrease in Trio®segment byproduct water sales. We sold 12% more tons of Trio® in the nine months ended September 30, 2024, compared to the same period in 2023, partially offset by a 7% decrease in our Trio®average net realized sales price per ton. Our Trio®tons sold increased during the nine months ended September 30, 2024, compared to the same period in 2023, as we sold more Trio®tons into row crop markets, particularly driven by the sulfate value of Trio®. During the first nine months of 2024, average Trio®prices were negatively affected by the 18% decrease in the average price for potash. However, Trio®prices only declined 7% as customers saw the relative value of the sulfate and low chloride potassium components of Trio®. We sold less Trio®segment byproduct water as we increased the volume of water used for injection at our HB plant and had fewer overall sales of water from our Caprock water rights.
Previous wording
Our oilfield solutions segment sales, which includes sales of water, brine water, and surface use agreements and easements, increased $1.5 million, or 16%, in the six months ended June 30, 2024, compared to the same period in 2023, driven by a $0.6 million increase in water sales, a $0.5 million increase in brine water sales, and a $0.5 million increase in other products and services. Continued robust oil and gas activity near Intrepid South has driven strong demand for products and services offered through our oilfield solutions segment.
Current wording
Our oilfield solutions segment sales, which includes sales of water, brine water, and surface use agreements and easements, increased $6.9 million, or 49%, in the nine months ended September 30, 2024, compared to the same period in 2023, driven by a $7.3 million increase in water sales, a $0.4 million increase in brine water sales, partially offset by an $0.8 million decrease in other products and services. Our oilfield solutions segment water revenues increased due to the completion of a large frac on Intrepid South during the third quarter of 2024. Continued robust oil and gas activity near Intrepid South has driven strong demand for products and services offered through our oilfield solutions segment.
Previous wording
Our total byproduct sales, which are recorded in either our potash segment or Trio® segment, decreased $2.9 million in the six months ended June 30, 2024, compared to the same period in 2023, due mainly to a decrease in byproduct water sales. We did not sell any byproduct water as we increased the volume of water used for injection at our HB plant and had fewer overall sales of water from our Caprock water rights.
Current wording
Our total byproduct sales, which are recorded in either our potash segment or Trio® segment, decreased $3.3 million in the nine months ended September 30, 2024, compared to the same period in 2023, due mainly to a decrease in byproduct water sales. We did not sell any byproduct water during the nine months ended September 30, 2024, as we increased the volume of water used for injection at our HB plant and had fewer overall sales of water from our Caprock water rights.
Previous wording
Our Trio® segment cost of goods sold increased $2.8 million, or 7%, during the first half of 2024, compared to the first half of 2023, due to a 20% increase in sales volumes of Trio®. Our cost of goods sold was positively impacted by decreases in certain production costs, such as production labor and benefits expense, as we stopped operating an additional underground shift in early 2024 at our East facility and restarted our fine langbeinite recovery process in March 2024. In addition, the beginning 2024 weighted average carrying cost per ton of our finished goods was reduced by the lower of cost or net realizable value inventory adjustment recorded in the fourth quarter of 2023. Finally, we produced more tons of Trio®in the first half of 2024, compared to the first quarter of 2023, which lowered our per ton production costs. A significant portion of our production costs are fixed and an increase in tons produced decreases our per ton production costs.
Current wording
Our Trio® segment cost of goods sold decreased $2.7 million, or 5%, during the nine months ended September 30, 2024, compared to the same period in 2023, even though we sold 12% more tons of Trio®. Our Trio®cost of goods sold was positively impacted by decreases in certain production costs, such as production labor and benefits expense, as we stopped operating an additional underground shift in early 2024 at our East facility and restarted our fine langbeinite recovery process in March 2024. In addition, our beginning 2024 weighted average carrying cost per ton of our Trio®finished goods was reduced by the lower of cost or net realizable value inventory adjustment recorded in the fourth quarter of 2023. Finally, we produced 16% more tons of Trio®in the nine months ended September 30, 2024, compared to the same period in 2023, which lowered our per ton production costs. A significant portion of our production costs are fixed and an increase in the number of tons produced decreases our per ton production costs.
Previous wording
In the first half of 2024, we incurred $1.9 million of lower of cost or net realizable value inventory adjustments in our potash segment, as our weighted average carrying costs for certain potash products exceeded our expected average net realized sales price for those products. We did not incur any lower of cost or net realizable value inventory adjustments in the first half of 2023.
Current wording
In the nine months ended September 30, 2024, we incurred $2.3 million of lower of cost or net realizable value inventory adjustments in our potash segment, as our weighted average carrying costs for certain potash products exceeded our expected average net realized sales price for those products. We incurred $3.4 million in lower of cost or net realizable value inventory adjustments related to potash and Trio®products in the nine months ended September 30, 2023.
Previous wording
During the six months ended June 30, 2024, we generated gross margin of $14.1 million compared to gross margin of $31.7 million during the same period in 2023. As discussed above, our gross margin decreased mainly due to the lower average net realized sales price per ton for potash and Trio®products and we sold fewer tons of potash in the six months June 30, 2024, compared to the same period in 2023. In addition, we recorded lower of cost or net realizable value inventory adjustments of $1.9 million during the six months ended June 30, 2024.
Current wording
During the nine months ended September 30, 2024, we generated gross margin of $21.8 million compared to gross margin of $32.2 million during the same period in 2023. As discussed above, our gross margin decreased mainly due to the decrease in sales driven by lower average net realized sales price per ton for potash and Trio®products and we sold fewer tons of potash in the nine months September 30, 2024, compared to the same period in 2023.
Previous wording
During the year ended December 31, 2023, we recorded an impairment related to our Trio®segment assets because the net book value exceeded the estimated fair value of the assets. The fair value of the Trio®segment assets was primarily determined using the expected proceeds received in an orderly sale of the individual assets. For any Trio®segment capital spending during the three months ended June 30, 2024, we also estimated the fair value of those assets using the expected proceeds received in an orderly sale of those new assets and recorded an impairment of $0.8 million in the three months ended June 30, 2024.
Current wording
During the year ended December 31, 2023, we recorded an impairment related to our Trio®segment assets because the net book value exceeded the estimated fair value of the assets. The fair value of the Trio®segment assets was primarily determined using the expected proceeds received in an orderly sale of the individual assets. For any Trio®segment capital spending during the nine months ended September 30, 2024, we also estimated the fair value of those assets using the expected proceeds received in an orderly sale of those new assets and recorded an impairment of $3.1 million. We recorded a $0.5 million impairment related to our non-operating working interest in an oil and gas well during the nine months ended September 30, 2023.
Previous wording
Other operating income increased $1.9 million in the six months ended June 30, 2024, compared to the same period in 2023, due to other operating income recorded related to the Third Amendment to the Cooperative Development we signed with XTO in December 2023, that became effective as of January 1, 2024. As discussed in further detail in Footnote 7 - Other Long-term Deferred Income to the Condensed Consolidated Financial Statements, we are recognizing as other operating income the estimated transaction price associated with the Amendment on a straight-line basis over the term of the Amendment.
Current wording
Other operating income increased $2.8 million in the nine months ended September 30, 2024, compared to the same period in 2023, due to other operating income recognized related to the Third Amendment to the Cooperative Development we signed with XTO in December 2023, that became effective as of January 1, 2024. As discussed in further detail in Note 7 - Other Long-term Deferred Income to the Condensed Consolidated Financial Statements, we are recognizing as other operating income the estimated transaction price associated with the Amendment on a straight-line basis over the term of the Amendment.
Previous wording
During the six months ended June 30, 2024, we incurred income tax benefit of $1.1 million, compared to income tax expense of $3.8 million during the same period in 2023, as we incurred a net loss during the six months ended June 30, 2024, compared to net income in the same period in 2023.
Current wording
During the nine months ended September 30, 2024, we incurred income tax benefit of $1.1 million, compared to income tax expense of $1.9 million during the same period in 2023, as we incurred a loss before income taxes in the nine months ended September 30, 2024, compared to income before taxes in the same period in 2023.
Previous wording
We generated a net loss of $4.0 million during the six months ended June 30, 2024, compared to net income of $8.8 million for the same period in 2023, due to the factors discussed above.
Current wording
We generated a net loss of $5.8 million in the nine months ended September 30, 2024, compared to net income of $1.6 million in the same period in 2023, due to the factors discussed above.
Previous wording
Our total sales in the potash segment decreased $17.2 million in the three months ended June 30, 2024, compared to the same period in 2023, as potash sales recorded in the potash segment decreased $16.9 million, or 41%, and potash segment byproduct sales decreased $0.3 million. Our potash sales decreased in the second quarter of 2024, compared to the second quarter of 2023, as our average net realized sales price per ton decreased 15%, and we sold 30% fewer tons. Potash prices have declined as available global inventory has increased compared to 2023. We sold fewer tons of potash in the three months ended June 30, 2024, compared to the same period in of 2023, as we had fewer tons of potash to sell due to decreased production volumes at our HB and Wendover facilities. Byproduct sales decreased $0.3 million in the second quarter of 2024, compared to the second quarter of 2023, due to a $0.7 million decrease in magnesium chloride sales, partially offset by a $0.5 million increase in brine sales. Magnesium chloride sales declined due to decreased demand from the dedust market. Brine sales increased as we sold more barrels at a higher average price compared to the prior year due to continued robust oilfield activity near our mines.
Current wording
Our potash sales decreased in the three months ended September 30, 2024, compared to the same period in 2023, as our average net realized sales price per ton decreased 18%, partially offset by selling 17% more tons. Potash prices have declined as available global inventory has increased compared to 2023. We sold more tons of potash in the three months ended September 30, 2024, compared to the same period in of 2023, because potash production increased in the second quarter of 2024, compared to the second quarter of 2023, and we had an earlier end to the spring season compared to the prior year, resulting in more tons of potash in inventory to begin the third quarter.
Previous wording
Potash segment freight expense decreased 35% in the second quarter of 2024, compared to the second quarter of 2023, as we sold 30% fewer tons of potash. Our potash freight expense is further impacted by the geographic distribution of our potash and byproduct sales and by the proportion of customers arranging for and paying their own freight costs.
Current wording
Potash segment freight expense increased 11% in the three months ended September 30, 2024, compared to the same period in 2023, as we sold 17% more tons of potash. Our potash freight expense is further impacted by the geographic distribution of our potash and byproduct sales and by the proportion of customers arranging for and paying their own freight costs.
Previous wording
During the second quarter of 2024, we recorded lower of cost or net realizable value inventory adjustments of $1.4 million as our weighted average carrying cost per ton for inventoried potash products at our HB and Wendover facilities was higher than our expected average net realizable sales price per ton for those products. Because potash production at our HB and Wendover facilities was below historical production levels in 2023, our weighted average production costs at those facilities increased which increased our weighted average carrying costs. A significant portion of our potash production costs are fixed and a decrease in potash tons produced increases our potash production costs per ton. We did not record any lower of cost or net realized value inventory adjustments in the second quarter of 2023.
Current wording
During the three months ended September 30, 2024, we recorded lower of cost or net realizable value inventory adjustments of $0.5 million as our weighted average carrying cost per ton for inventoried potash products at our HB and Wendover facilities was higher than our expected average net realizable sales price per ton for those products. While potash production at our HB and Wendover facilities has improved in 2024, compared to 2023, potash production at these facilities remained below historical production levels which increased our weighted average carrying costs. A significant portion of our potash production costs are fixed and a decrease in the number of potash tons produced increases our potash production costs per ton. We recorded $1.1 million in lower of cost or net realized value inventory adjustments in the potash segment in the third quarter of 2023.
Previous wording
Our potash segment gross margin decreased $9.6 million in the second quarter of 2024, compared to the second quarter of 2023, due to the factors discussed above.
Current wording
Our potash segment gross margin increased $0.7 million in the three months ended September 30, 2024, compared to the same period in 2023, due to the factors discussed above.
Previous wording
Our total sales in the potash segment decreased $32.2 million in the six months ended June 30, 2024, compared to the same period in 2023, as potash sales recorded in the potash segment decreased $31.7 million, or 36%, and potash segment byproduct sales decreased $0.4 million. Our potash sales decreased in the six months ended June 30, 2024, compared to the same period in 2023, as our average net realized sales price per ton decreased 18%, and we sold 23% fewer tons. We sold fewer tons of potash in the six months ended June 30, 2024, compared to the same period in 2023, as we had fewer tons of potash to sell due to lower potash production from our HB and Wendover facilities during the second half of 2023. Our average net realized sales price per potash ton decreased during the six months ended June 30, 2024, compared to the same period in 2023, as the available supply of potash has increased. Byproduct sales recorded in our potash segment decreased $0.4 million as a $1.5 million decrease in magnesium chloride sales was partially offset by a $1.0 million increase in brine sales. Magnesium chloride sales declined due to mild winter weather which decreased demand for our deicing product in the first quarter of 2024, and a slow start to the dust control season in the second quarter of 2024. Brine sales increased as we sold more barrels at a higher average price compared to the prior year due to continued oilfield activity near our mines.
Current wording
Our total sales in the potash segment decreased $31.4 million in the nine months ended September 30, 2024, compared to the same period in 2023, as potash sales recorded in the potash segment decreased $31.9 million, or 29%, partially offset by a $0.6 million increase in potash segment byproduct sales. Our potash sales decreased in the nine months ended September 30, 2024, compared to the same period in 2023, as our average net realized sales price per ton decreased 18%, and we sold 14% fewer tons. We sold fewer tons of potash in the nine months ended September 30, 2024, compared to the same period in 2023, as we began 2024 with less inventory of potash to sell due to lower potash production from our HB and Wendover facilities during the second half of 2023. While potash production has improved at our HB and Wendover facilities during the nine months ended September 30, 2024, compared to the same period in 2023, production levels at these facilities remain below historical production levels. Our average net realized sales price per potash ton decreased during the nine months ended September 30, 2024, compared to the same period in 2023, as the available supply of potash has increased.
Previous wording
Potash segment freight expense decreased 28% in the six months ended June 30, 2024, compared to the same period in 2023, as we sold 23% fewer tons of potash. Our potash freight expense is further impacted by the geographic distribution of our potash and byproduct sales and by the proportion of customers arranging for and paying their own freight costs.
Current wording
Potash segment freight expense decreased 18% in the nine months ended September 30, 2024, compared to the same period in 2023, as we sold 14% fewer tons of potash. Our potash freight expense is further impacted by the geographic distribution of our potash and byproduct sales and by the proportion of customers arranging for and paying their own freight costs.
Previous wording
During the first half of 2024, we recorded lower of cost or net realizable value inventory adjustments of $1.9 million as our weighted average carrying cost per ton for certain inventoried potash products at our HB and Wendover facilities was higher than our expected average net realized sales price per ton for those products. Because potash production at our HB and Wendover facilities was below historical production levels during the second half of 2023, our weighted average production costs at those facilities increased. As mentioned, a significant portion of our potash production costs are fixed and a decrease in potash tons produced increases our potash production costs per ton. We did not record any lower of cost or net realized value inventory adjustments in the first half of 2023.
Current wording
During the first nine months of 2024, we recorded lower of cost or net realizable value inventory adjustments of $2.3 million as our weighted average carrying cost per ton for certain inventoried potash products at our HB and Wendover facilities was higher than our expected average net realized sales price per ton for those products. Because potash production at our HB and Wendover facilities was below historical production levels during the second half of 2023 and the first nine months of 2024, our weighted average production costs at those facilities increased. As mentioned, a significant portion of our potash production costs are fixed and a decrease in the number of potash tons produced increases our potash production costs per ton. We recorded $1.1 million in lower of cost or net realized value inventory adjustments in the first nine months of 2023.
Previous wording
Our potash segment gross margin decreased $18.4 million in the first half of 2024, compared to the first half of 2023, due to the factors discussed above.
Current wording
Our potash segment gross margin decreased $17.8 million in the first nine months of 2024, compared to the first nine months of 2023, due to the factors discussed above.
Previous wording
The table below shows our potash sales mix for the three and six months ended June 30, 2024, and 2023:
Current wording
The table below shows our potash sales mix for the three and nine months ended September 30, 2024, and 2023:
Previous wording
Trio®freight costs increased 6%, in the second quarter of 2024, compared to the second quarter of 2023, while sales volumes were unchanged. Our Trio®freight expense is impacted by the geographic distribution of our Trio® sales and by the proportion of customers arranging for and paying their own freight costs.
Current wording
Trio®freight costs decreased 4% in the third quarter of 2024, compared to the third quarter of 2023, as we sold fewer tons. Our Trio®freight expense is impacted by the geographic distribution of our Trio® sales and by the proportion of customers arranging for and paying their own freight costs.
Previous wording
Our Trio®cost of goods sold decreased 18% in the three months ended June 30, 2024, compared to the same period in 2023, even though our sales tons were unchanged. Our cost of goods sold was positively impacted by decreases in certain production costs, such as production labor and benefits expense, as we moved to a reduced operating schedule at our East facility and restarted our fine langbeinite recovery process in March 2024. In addition, the beginning 2024 weighted average carrying cost per ton of our finished goods was reduced by the lower of cost or net realizable value inventory adjustment recorded in the fourth quarter of 2023. Finally, we produced more tons of Trio®in the three months ended June 30, 2024, compared to the same period in 2023, which lowered our per ton production costs. A significant portion of our production costs is fixed and an increase in tons produced decreases our per ton production costs.
Current wording
Our Trio®cost of goods sold decreased 31% in the three months ended September 30, 2024, compared to the same period in 2023, as we sold 13% fewer tons. In addition, our cost of goods sold was positively impacted by decreases in certain production costs, such as production labor and benefits expense, as we moved to a reduced operating schedule at our East facility and restarted our fine langbeinite recovery process in March 2024. Finally, we produced more tons of Trio®in the three months ended September 30, 2024, compared to the same period in 2023, which lowered our per ton production costs. A significant portion of our production costs is fixed and an increase in the number of tons produced decreases our per ton production costs.
Previous wording
During the year ended December 31, 2023, we recorded an impairment related to our Trio®segment assets because the net book value exceeded the estimated fair value of the assets. The fair value of the Trio®segment assets was primarily determined using the expected proceeds received in an orderly sale of the individual assets. For any new Trio®segment capital spending during the three months ended June 30, 2024, we also estimated the fair value of those assets using the expected proceeds received in an orderly sale of those new assets, and we recorded an additional impairment of $0.8 million. Although we have reduced capital spending at our East facility compared to prior years, we expect to incur additional capital expenditures in the future periods for our Trio®segment assets that we will likely have to impair.
Current wording
During the year ended December 31, 2023, we recorded an impairment related to our Trio®segment assets because the net book value exceeded the estimated fair value of the assets. The fair value of the Trio®segment assets was primarily determined using the expected proceeds received in an orderly sale of the individual assets. For any new Trio®segment capital spending during the three months ended September 30, 2024, we also estimated the fair value of those assets using the expected proceeds received in an orderly sale of those new assets, and we recorded an additional impairment of $0.9 million. Although we have reduced capital spending at our East facility compared to prior years, we expect to incur additional capital expenditures in future periods for our Trio®segment assets that we will likely have to impair.
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Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Our oilfield solutions segment sales, which includes sales of water, brine water, and surface use agreements and easements, increased $0.4 million, or 8%, in the three months ended June 30, 2024, compared to the same period in 2023, driven by a $0.3 million increase in other oilfield products and services and a $0.2 million increase in brine water sales. Continued robust oil and gas activity near Intrepid South has driven strong demand for products and services offered through our oilfield solutions segment.
Previous report — wording carried elsewhere
Trio® segment sales decreased 8% during the three months ended June 30, 2024, compared to the same period in 2023. Trio® sales decreased $0.8 million, and our Trio® segment byproduct sales decreased $1.4 million. Trio® sales decreased primarily due to a 6% decrease in our average net realized sales price per ton while tons sold was unchanged. Similar to potash prices discussed above, our Trio®average net realized sales price per ton has decreased as potassium fertilizer supplies improved.