While the United States enjoys unseasonably mild winter weather, the warm temperatures and lack of snow are bad news for deicing salt producer Compass Minerals International Inc.
The Overland Park-based company, which is one of the largest suppliers of road salt products, said Tuesday its full-year earnings per share will now be less than the low end of its October forecast of $5.20 to $5.50. The average of eight analysts’ estimates compiled by Bloomberg News is $5.38.
Compass is curbing production at its Goderich mine in Ontario and reducing the number of employees there by about 90, the company said in a statement. It also cited weak demand for its plant nutrition products.
The fourth quarter has been the least snowy in at least a decade, according to Chris Shaw, an analyst at Monness Crespi Hardt & Co., who said Monday in a note that he was cutting his share price target for Compass to $68 from $75.
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The second week of December was the hottest for that period in North America in more than half a century, according to weather data provider Planalytics Inc.
“We also now expect significant volume declines for the first quarter unless unusually high snowfall occurs at the beginning of the quarter,” said Shaw.
Compass shares fell early Tuesday but recovered, closing at $74.93, up $2.81.
The company said it will update investors on winter weather and salt sales on Jan. 7.
Bloomberg News contributed to this report.