IPI 10-K & 10-Q changes, risk factors and insider trading

•Joint development arrangements and other strategic collaborations expose us to risks, and we cannot guarantee that we will realize any economic benefit from these projects.

•We operate a limited number of key production and distribution facilities, and a disruption at one of these facilities could significantly affect production of our products or our ability to fulfill our contractual obligations, which could damage customer relationships.

•Our operations are dependent on critical equipment that may need repair or replacement sooner than anticipated, which could result in increased capital maintenance or expenditures and production disruptions.

•Inflation could result in higher costs and decreased profitability.

•We are subject to financial assurance requirements and failure to satisfy these requirements could materially affect our business, results of our operations and our financial condition.

•Unanticipated litigation or investigations, or negative developments in pending litigation or investigations or with respect to other contingencies, could adversely affect us.

•We could incur significant environmental liabilities with respect to our current, future, or former facilities.

•We may face product liability claims and product recalls, which could harm our business and reputation.

Joint development arrangements and other strategic collaborations expose us to risks, and we cannot guarantee that we will realize any economic benefit from these projects.

We are party to a Joint Development Agreement (“JDA”) with Aquatech International, LLC and Adionics to pursue definitive agreements governing the potential development of a 5,000 metric tonne lithium extraction facility using the post-process brine at our Wendover facility. The success of this collaboration depends on coordinated efforts between us and our partners, and we have limited control over our partners’ performance and strategic priorities. If our partners fail to perform their obligations, allocate insufficient resources to the collaboration, experience financial or operational difficulties, or exercise their termination rights, development and commercialization activities could be delayed or discontinued.

Our current and future collaboration efforts may involve shared decision-making, cost-sharing arrangements, and intellectual property rights. Disputes regarding development strategies, milestone achievements, funding obligations, commercialization rights, or ownership and enforcement of intellectual property may arise and could result in delays, increased costs, or litigation. In addition, if agreements are terminated, in order to continue development, we may be required to assume full development responsibilities, seek an alternative partner, or discontinue our efforts to develop our lithium resource, any of which could require significant additional capital and may not be successful.

Accordingly, our reliance on this collaboration or other similar collaboration may subject us to risks that could materially and adversely affect our business, financial condition, and results of operations.

In 2025, we recorded total impairment charges to our long-lived assets and mineral properties of $1.9 million related to assets at our East mine.

We operate a limited number of key production and distribution facilities, and a disruption at one of these facilities could significantly affect production of our products or our ability to fulfill our contractual obligations, which could damage customer relationships.

We produce potash from three solution mining facilities: our HB solution mine in Carlsbad, New Mexico, our solution mine in Moab, Utah, and our brine recovery mine in Wendover, Utah. We also operate our North compaction facility in Carlsbad, New Mexico, which compacts and granulates product from the HB mine. We produce Trio® from a single conventional underground East mine in Carlsbad, New Mexico. Any disruption of operations at one of those facilities could significantly affect production of our products or our ability to fulfill contractual obligations, which could damage customer relationships. Production at our facilities could be disrupted or negatively impacted by equipment failure, ore grade, or other risk factors, which could result in reduced sales. A production interruption or disruption at one or more of our facilities could result in a loss of customers, a loss in revenue, or subject us to fines or penalties.

Our operations are dependent on critical equipment that may need repair or replacement sooner than anticipated, which could result in increased capital maintenance or expenditures and production disruptions.

Our operations depend on critical equipment such as continuous mining machines, hoists, conveyor belts, loading equipment, compactors, and dryers. This equipment could be damaged or destroyed, suffer breakdowns or failures or deteriorate due to wear and tear sooner than we estimate, and we may be unable to replace or repair the equipment in a timely manner or at a reasonable cost. If these events occur, we may incur additional maintenance and capital expenditures, our operations could be materially disrupted, and we may not be able to produce and ship our products.

We have permitted, licensed, declared and partially adjudicated water rights in New Mexico under which we sell water primarily for industrial uses such as in the oil and gas services industry. If there are changes in state or federal regulations regarding oil and gas production or water usage, this could materially impact our ability to monetize our water rights. Third parties can challenge our applications to the OSE to change our water rights permits so that we are authorized to sell water to oil and gas producers. We may not be successful in our efforts to obtain the requisite permit changes. In many cases, sales of water require governmental permits or approvals. A decision to deny, delay, revoke, or modify a permit or approval could prevent us from selling water or increase the cost to provide water. If oil or gas prices decline, if oil and gas development in the Permian Basin decreases, or if demand for fresh water in the Permian Basin declines for other reasons, the demand for water under our water rights could be adversely affected. In addition, we could be required to expend capital to meet customer needs. Any of these events could adversely impact our financial condition and results of operations.

Water rights in New Mexico are subject to a stated place of withdrawal, purpose and place of use. Some of our water right permits, declarations and licenses were originally issued for uses relating to our mining operations. To sell water under these rights for oil and gas development, we must apply for a permit from the OSE to change the point of diversion, purpose and/or place of use of the underlying water rights. The OSE reviews such applications and makes a determination as to the validity of the right and, will approve the proposed change if it determines the requested change will not impair existing water rights, will not be contrary to the conservation of water within the state, and will not be detrimental to the public welfare of the state. Third parties may protest an application to change a point of diversion or purpose or place of use at minimal cost and frequently do so. Once protested, an administrative process begins, whereby the OSE will ultimately determine if the subject application or preliminary authorization will impair existing water rights, will be contrary to the conservation of water within the state or will be detrimental to the public welfare of the state. The OSE’s findings can be appealed to a New Mexico district court. Additionally, some of our water rights are permitted water rights for which we still need to provide proof of completion of works and proof of beneficial use to the OSE. Until we file proof of completion of work and proof of beneficial use, the water rights are not vested and may not be approved in their entirety. Please see Note 15 of the Notes to Consolidated Financial Statements for an update on challenges to our water rights.

Inflation could result in higher costs and decreased profitability.

Our business can be affected by inflation, including higher costs for transportation (including freight rates), energy, materials, supplies, labor, and other costs. Our ability to recover inflation-driven cost increases may be constrained by the terms of our contracts, the competitive nature of the bidding process, and the economic and industry conditions prevailing in the markets where we operate. Significant inflation presents a risk of materially increasing our costs and adversely impacting our profitability and overall financial performance.

We are subject to financial assurance requirements and failure to satisfy these requirements could materially affect our business, results of our operations and our financial condition.

As part of our business operations, we are required to maintain financial surety or performance bonds with state and federal agencies and fund reclamation and site cleanup following the ultimate closure of our mines. We incur costs to maintain these financial assurance bonds and failure to satisfy these financial assurance requirements could materially affect our business, the results of our operations and our financial condition.

We hold numerous environmental, mining, safety, and other permits and governmental approvals authorizing and regulating the operations at each of our facilities. An agency's decision to deny or delay a new or renewed permit or approval, or to revoke or substantially modify an existing permit or approval, could prevent or limit us from continuing our operations at the affected facility, which could have an adverse effect on our business, financial condition, and results of operations. For example, the majority of the water we use for our HB and East operations are derived from wells located on state lands, which we access through an easement issued by the New Mexico State Land Office (“NMSLO”). We are currently operating under a temporary renewal of our water rights easement that expires on May 5, 2026. We are working collaboratively with the NMSLO for a long-term renewal of the easement. While we anticipate we will be successful in obtaining a renewal, it is not guaranteed. The failure to timely renew or the loss of this easement could have a material adverse effect on us, including disruption or cessation of operations.

In addition, we could be required to expend significant amounts to obtain, or come into compliance with, these permits, approvals, and leases, or we could be required to make significant capital investments to modify or suspend our operations at one or more of our facilities. For example, our HB operations are subject to a discharge permit issued by NMED that we may have to expend significant capital to comply with, as NMED may include new or modified conditions to the permit when it is renewed.

Also, certain of our existing leases require us to make royalty payments based on the revenue generated by the potash, langbeinite, water, or byproducts that we extract from the leased land. The royalty rates are subject to change whenever we renew our leases, which could lead to significant increases in these rates. As of December 31, 2025, approximately 6% of our state, federal and private lease acres at our New Mexico facilities (including leases at the HB and North mines) will be up for renewal within the next five years while none of our state and federal lease acres at our Utah operations will be up for renewal within the next five years. Increases in royalty rates would reduce our profit margins and, if the increases were significant, would adversely affect our results of operations. Reporting of royalties is subject to periodic audits by federal and state officials.

Unanticipated litigation or investigations, or negative developments in pending litigation or investigations or with respect to other contingencies, could adversely affect us.

We are currently, and may in the future become, subject to litigation, arbitration, or other legal proceedings with other parties. Any claim that is successfully asserted against us in these legal proceedings, or others that could be brought against us in the future, may adversely affect our financial condition or results of operations.

We could incur significant environmental liabilities with respect to our current, future or former facilities.

Risks of environmental liabilities is inherent in our current and former operations. At many of our past and present facilities, releases and disposals of regulated substances have occurred and could occur in the future, which could require us to investigate, undertake or pay for remediation activities under federal or state laws and regulations. Our facilities are also subject to laws and regulations which require us to monitor and detect potential environmental hazards and damages. Our procedures and controls may not be sufficient to timely identify and protect against potential environmental damages and related costs. We record accruals for contingent environmental liabilities when we believe it is probable that we will be responsible, in whole or in part, for environmental investigation, asset retirement obligation or remediation activities and the expenditures for these activities are reasonably estimable. However, the extent and costs of any environmental investigation, asset retirement obligation or remediation activities are inherently uncertain and difficult to estimate and could exceed our expectations, which could materially affect our financial condition and operating results.

We may face significant product liability claims and product recalls, which could harm our business and reputation.

We face exposure to product liability and other claims if our products cause harm, are alleged to have caused harm or have the potential to cause harm to consumers or their property. In addition, our products or products manufactured by our customers using our products could be subject to a product recall as a result of product contamination, our failure to meet product specifications or other causes. For example, the use and application of our animal feed and plant nutrition products could result in a product recall if it were alleged that they were contaminated.

A product recall could result in significant losses due to the costs of a recall, the destruction of product inventory and production delays to identify the underlying cause of the recall. We could be held liable for costs related to our customers’ product recall if our products cause the recall or other product liability claims if our products cause harm to our customers or their property. Additionally, a significant product liability case, product recall or failure to meet product specifications could result in adverse publicity, harm to our brand and reputation and significant costs, which could have a material adverse effect on our business and financial performance. Our insurance coverage may be insufficient to cover all losses related to product liability claims and product recalls.

•Tariffs and retaliatory tariffs. Since February 2025, the U.S. government has announced, implemented, modified, paused, and/or terminated various tariff measures, including tariffs pursuant to the International Emergency Economic Powers Act (“IEEPA”) (which were held unlawful in February 2026 by the U.S. Supreme Court and terminated), and a number of new or modified tariffs on imports of specific classes of products (including, but not limited to, steel, aluminum, and copper) under Section 232 of the Trade Expansion Act of 1962 (“Section 232”), and most recently a temporary tariff under Section 122 of the Trade Act of 1974 (“Section 122”). In addition, the U.S. government has indicated that it will initiate investigations with the intention of imposing additional tariffs under Section 232 and Section 301 of the Trade Act of 1974.

Imports from Canada and Mexico that meet the origin rules of the United States-Mexico-Canada Agreement ("USMCA"), were exempt from the IEEPA tariffs, and are currently exempt from the Section 122 tariffs, but not Section 232 tariffs. The status of the Section 122 exemption is uncertain, as is whether the USMCA-qualifying goods would be exempt from future tariffs, and the USMCA itself may be subject to renegotiation. Other countries and customs unions, including the United Kingdom, European Union, Japan and Korea, have negotiated separate trade agreements with the U.S. resulting in lower tariffs than would have otherwise applied. However, the status of these agreements is uncertain in light of the termination of IEEPA tariffs, and such agreements are subject to further negotiation.

The U.S. also continues to negotiate with additional trade partners on potential agreements, the outcome of which remains uncertain. These tariffs have also at time led, and may continue to lead, to retaliatory tariffs imposed by other countries. This volatility of tariffs creates uncertainty regarding the extent and impact of tariffs on our business and the economy in general. Tariffs, or the potential for tariffs, may affect the costs and availability of raw materials, affect our customers' purchasing decisions, contribute to increases in operating costs through increases in product and equipment costs, wages, and energy, or have other related impacts on our business and the markets in which we operate.

•Trio® pricing and demand. Our average net realized sales price for Trio® increased to $367 per ton in 2025, compared to $311 per ton in 2024. Similar to potash, after prices peaked in mid-2022, Trio® pricing steadily declined until reaching a floor in the second half of 2023. Trio® prices were relatively flat in the first half of 2024 with summer-fill pricing of $320 per ton, after which rising sulfate values and increased demand led to multiple prices increases in both the second half of 2024 and first half of 2025, with prices peaking in June 2025 at $415 per ton, a $95 per ton increase over the summer-fill levels of the prior year. We announced a fall-fill program in October 2025, reducing price $35 per ton to $380 per ton, during a one-week order window and saw record subscription with 87,000 tons sold in the fourth quarter of 2025. Pricing increased to $405 per ton after the order window and we continue to see good demand to date in 2026. Our ability to realize the increased prices may be affected by, among other things, weather, planting decisions, rail car availability, commodity price decreases, and the price and availability of other potassium products.

◦HB AMAX Cavern - After further evaluation of our AMAX Cavern project, we have deferred additional capital investment in our AMAX Cavern project until at least 2027. While the AMAX Cavern remains a key part of our HB mine and we remain confident in the potash reserve in place, we believe we have adequate brine sources to maintain production at our HB facility for the next few years. Before committing additional capital, we are looking to ensure we have adequate brine injection volumes to flood the AMAX Cavern, which will be the largest cavern in the HB system, and the necessary bitterns management system in place to maximize the full potential of this additional cavern.

•Lithium Development Project. In 2025, we entered into a Joint Development Agreement ("JDA") with Aquatech International, LLC and Adionics (together, the "Lithium Partners") to pursue the potential development of a 5,000 metric tonne lithium extraction facility using the post-process brine at our Wendover facility. Initial demonstration testing using our Wendover brine was successful, with a lithium extraction rate of 92.9% and lithium chloride purity above 99.5%. The lithium chloride was further processed to produce a >99.5% lithium carbonate product, meeting key specifications for battery manufacturing. Under the JDA, Aquatech is completing comprehensive feasibility studies and detailed engineering of a 5,000 metric tonne lithium extraction facility. The Lithium Partners are advancing project design and development, and negotiating definitive agreements, with a goal of reaching a final investment decision in 2026.

•Water sales. Water sales decreased in 2025 to $3.2 million, compared to $13.6 million in 2024 as continued expansion of produced water and water recycling infrastructure has increased the availability of recycled water and reduced demand for water from both our Caprock wells and on Intrepid South. In 2024, we supplied water for one drilling program during the third quarter which accounted for approximately $5.5 million, or 40%, of our total water sales. We did not have an equivalent sale during 2025. While oil and gas activity remains strong in southeast New Mexico and on Intrepid South, we expect the trend towards the use of produced and recycled water will continue for the foreseeable future.

•Byproduct sales. Byproduct sales decreased to $25.1 million in 2025 compared to $25.3 million in 2024. Magnesium chloride sales increased $0.9 million compared to 2024, as we saw a return to more historic sales volumes in 2024, offset by $0.9 million decrease in salt sales. Brine sales decreased $0.2 million, or 3%, compared to 2024 as oil and gas activity near in southeast New Mexico continues to drive strong demand for heavy brine.

Our total potash segment sales increased $14.8 million during 2025, compared to 2024, driven by an increase of $14.9 million in potash sales, partially offset by a $0.1 million decrease in potash byproduct sales. Our potash sales increased due to a 20% increase in potash tons sold during 2025, compared to 2024, partially offset by a 6%, decrease in potash average net realized sales price per ton. We sold more tons of potash in 2025, compared to 2024, because our available supply of potash increased in 2025, compared to 2024, mainly due to strong potash production during the second half of 2024 and the first half of 2025.

Our potash average net realized sales price per ton decreased 6% in 2025, compared to 2024, primarily due to lower potash price levels during the spring application season. The 2025 potash winter-fill program, announced in January 2025, was $70 per ton less than the 2024 potash winter-fill program in January 2024. After the winter-fill program in 2025, strong demand and supportive commodity prices led to multiple potash price increases in the first half of 2025, with summer-fill potash price of $390 per ton, a $55 per ton increase compared to 2024. Although potash prices rose steadily during 2025, we sold fewer tons in the second half of 2025 at the higher per ton prices, compared to tons sold during the first half of 2025 at the lower per ton prices.

Our oilfield solutions segment sales decreased by $10.2 million in 2025, compared to 2024, driven by a decrease of $10.4 million in water sales, partially offset by a $0.2 million increase in brine water sales and other oilfield solutions products and services. Water sales decreased due to reduced demand from both our Caprock and Intrepid South water rights as oil and gas operators continue to increase the use of produced and recycled water in their operations. Sales of water on Intrepid South also vary based on the drilling schedules of operators on our land. In 2024, we supplied water to a large frac in the third quarter, which accounted for $5.5 million, or 40% of our water sales for the year. We did not have an equivalent frac on Intrepid South in 2025.

Our potash segment cost of goods sold increased 13% in 2025, compared to 2024, mainly due to us selling 20% more tons of potash in 2025, compared to 2024. Increased potash production rates, specifically in the second half of 2024, decreased the carrying cost of our potash at the start of 2025, compared to 2024, reducing our per ton cost of goods sold in 2025. Our potash cost of goods sold during 2025 was favorably impacted by lower of cost or net realizable value inventory adjustments recorded during the second half of 2024 and the first half of 2025. Recording lower of cost or net realizable value inventory adjustments reduces our potash carrying costs per ton.

Selling and administrative expenses increased $3.7 million or 11% in 2025 compared to 2024, as professional services expenses increased $1.9 million and stock compensation expense increased $1.4 million. Our professional services expenses increased in 2025, compared to 2024, as we used more third-party consultants in 2025. Our stock compensation expense increased in 2025, compared to 2024, mainly due to the resignation of our former Chief Executive Officer ("CEO") in September 2024. Recognized stock compensation expense related to the former CEO's unvested equity awards at the time of his resignation in September 2024 was reversed which lowered 2024 stock compensation expense.

During the year ended December 31, 2025, we recorded total impairment charges of $1.9 million. During the year ended December 31, 2024, we recorded total impairment charges of $10.7 million.

In 2023, the fair value of our Trio® segment assets was determined using the expected proceeds received in an orderly sale of the individual assets. During 2024, for any Trio® segment capital spending during 2024, we also estimated the fair value of those assets using the expected proceeds received in an orderly sale of the new individual assets and recorded impairment charges of $4.4 million. We continued to record impairment charges for our Trio® segment capital spending during the first nine months of 2025, using the expected proceeds received in an orderly sale of new individual assets and recorded impairment charges of $1.9 million. We did not record any impairment charges for any Trio® segment capital spending during the three months ended December 31, 2025, because the projected undiscounted cash flows generated by our Trio® segment asset group exceeds the net book value of the Trio® segment asset group due to the continued financial improvement in our Trio® segment asset group.

Also, during 2024, we recorded impairment charges of $6.4 million in our oilfield solutions segment mainly related to our frac sand opportunity and other oilfield related equipment based on the expected selling price of those assets, which were subsequently sold in 2025.

Other operating expense increased $2.9 million in 2025 compared to 2024. During 2025, we recorded $4.0 million related the potential settlement of a class action lawsuit and $2.2 million for potential fines related to an unpermitted discharge at our HB facility. During 2024, we recorded an additional $1.9 million related to the potential underpayment of royalties to the ONRR from 2012 through 2016, we incurred $0.9 million for royalties assessed by the State of New Mexico on certain water sales made during 2019 to 2022, and we recorded $0.6 million in expenses associated with product contamination. During 2025, we paid the ONRR $3.5 million for the underpayment of royalties from 2012 through 2016, which closed the matter.

We recorded income tax expense of $0.5 million in 2025, for state income taxes in jurisdictions where we were unable to utilize deferred tax assets for net operating losses. In 2024, we recorded an income tax expense of $194.3 million as we increased our valuation allowance against our deferred tax assets by $199.0 million since we concluded that it was more likely than not that our deferred tax assets would not be realized.

Our potash average net realized sales price per ton decreased 6% in 2025, compared to 2024. The 2025 potash winter fill program that was announced in early January 2025 was $70 per ton less than the 2024 potash winter fill program that was announced in early January 2024. While per ton potash prices rose steadily during 2025, we sold fewer tons in the second half of 2025 at the higher per ton prices, compared to tons sold during the first half of 2025 at the lower per ton prices.

Our potash segment cost of goods sold increased 13% in 2025 compared to 2024, mainly due to selling 20% more tons of potash in 2025, compared to 2024. Increased potash production rates, specifically in the second half of 2024, decreased the carrying cost of our potash to begin 2025, compared to 2024, reducing our per ton cost of goods sold in 2025. Our potash cost of goods sold during 2025 was also favorably impacted by lower of cost or net realizable value inventory adjustments recorded during the second half of 2024 and the first half of 2025. Recording lower of cost or net realizable value inventory adjustments reduces our potash carrying costs per ton.

Geopolitical conflict and volatility and sustained increases in oil prices could adversely impact our results of operations or financial condition.

Geopolitical instability in the Middle East, including the ongoing conflict involving Iran, as well as any actual or threatened disruption, closure, or restricted transit of the Strait of Hormuz, including the current closure, could adversely affect global oil and natural gas markets and materially impact our business, financial condition, results of operations and cash flows. Future escalation of the Iran conflict, prolonged impairment or closure of the Strait of Hormuz, additional sanctions or export restrictions, or further attacks on oil and gas infrastructure or shipping lanes in the region could reduce global supply, drive sustained or extreme spikes in oil and natural gas prices, and increase uncertainty in the energy markets. In addition, heightened geopolitical tensions related to the Iran conflict may result in new or expanded economic sanctions, export controls, tariffs or other governmental actions that could indirectly affect our customers, suppliers and financing sources, as well as broader macroeconomic conditions. Such potential impacts also could include supply chain and logistics disruptions, volatility in foreign exchange rates, inflationary pressures on raw materials and energy, and heightened cybersecurity threats. These developments and impacts could negatively affect demand for our products and services, and could adversely impact our results of operations or financial condition.

•the impact of global conflicts including the conflict involving Iran and the blockage of the Strait of Hormuz;

•the timing, amount and impact of any repurchases under our stock repurchase program;

We owned certain land, water rights, federal grazing leases, and other related assets in southeast New Mexico, which we collectively referred to as "Intrepid South." Intrepid South generated revenue primarily from sales of various oilfield-related products and services, including water, brine, surface use and right-of-way agreements, a produced water royalty agreement, and caliche.

In March 2026, our Board of Directors ("Board") approved the sale of Intrepid South, and we determined that the business met the criteria for classification as held for sale and discontinued operations. We received aggregate consideration of $70.0 million related to the transaction, consisting of an $8.0 million deposit received in December 2025 and a $62.0 million payment received at closing on April 1, 2026. Following customary adjustments and the satisfaction of closing conditions, the final sales price was $68.9 million. As a result of the transaction, we recorded a gain on sale in discontinued operations, net of taxes, of $13.2 million during the three months ended June 30, 2026.

We currently have two reportable segments: potash and Trio®. Through December 31, 2025, our oilfield solutions segment was also a reportable segment. Following the sale of Intrepid South, the oilfield solutions segment is no longer reported as a reportable segment, and all prior-period segment disclosures presented in this Quarterly Report on Form 10-Q have been recast to conform to the current presentation.

• Tariffs and tensions in the Middle East. The operating environment continues to be affected by evolving trade policies, including tariffs, together with heightened geopolitical tensions in the Middle East. These developments have contributed to higher input costs, increased freight and logistics expenses, volatility in energy markets, supply chain disruptions and broader macroeconomic uncertainty.

Our average net realized sales price per ton increased to $365 for the six months ended June 30, 2026, from $332 for the corresponding period in 2025. Winter fill program pricing for 2026 was $355 per ton, compared to $315 per ton for the 2025 program. Following the successful completion of the winter fill program, list prices increased by $20 per ton in late January 2026 and by an additional $10 per ton in late April. In June 2026, we launched a summer fill program at $385 per ton, with list prices increasing to $395 per ton upon completion of the program. Customer participation in the summer fill program was good, with customers placing orders covering a considerable portion of their third quarter needs. Potash pricing continues to be supported by healthy agricultural demand, balanced global supply fundamentals, and the recent India contract settlement, which is supportive of U.S. market prices.

Our Trio® average net realized sales price per ton increased to $388 during the six months ended June 30, 2026, from $352 in the corresponding period in 2025, reflecting continued favorable market pricing for the individual nutrient components of Trio®, particularly sulfate and potassium.

• Byproduct sales. We sell byproducts that are derived from our potash and Trio® operations. Byproduct sales were $5.4 million and $9.9 million, respectively, during the three and six months ended June 30, 2026, compared to $6.2 million, and $12.6 million, respectively, for the same periods of 2025. Byproduct sales decreased in both periods in 2026, compared to 2025, due to lower sales of salt and magnesium chloride.

Byproduct sales of salt and magnesium chloride during the three months and six months ended June 30, 2026, were negatively impacted by the mild winter and historically low snowfall levels across the western U.S., which reduced demand for deicing products and resulted in higher customer inventory levels entering the second quarter. These elevated inventory levels adversely affected shipments during the early part of the second quarter.

Our Trio® segment sales increased $2.5 million, or 8%, in the three months ended June 30, 2026, compared to the same period in 2025. The increase was driven by a $2.5 million increase in Trio® sales, while Trio® segment byproduct sales were flat. Trio® sales increased due to an increase of 6% in our Trio® average net realized sales price per ton, compared to the same period in 2025, driven by continued supportive pricing for the individual nutrient components of Trio®, particularly sulfate and potassium. Trio® sales volumes were unchanged compared to the prior-year period.

Selling and administrative expenses increased $1.1 million during the three months ended June 30, 2026, compared to the corresponding period in 2025. The increase was primarily driven by higher bonus expense of $0.5 million, employee safety awards of $0.3 million, and increased professional services expense of $0.2 million. The increase in bonus expense reflected stronger performance relative to the metrics underlying incentive compensation programs, while the employee safety awards recognized the Company's outstanding safety record in 2025. Professional services expense increased due to greater use of external consultants.

In March 2026, our Board approved the sale of our Intrepid South business. The transaction closed on April 1, 2026, and we received gross proceeds of $70 million. Following customary post-closing adjustments and the satisfaction of closing conditions, the final sales prices was $68.9 million. As result of the transaction, we recognized a gain on sale in discontinued operations, net of taxes, of $13.2 million during the three months ended June 30, 2026. See Note 3 to the Condensed Consolidated Financial Statements for further information.

Net Income from Continuing Operations

Consolidated Results for the Six Months Ended June 30, 2026, and 2025

Sales

Our total sales increased $3.3 million, or 2%, during the six months ended June 30, 2026, compared to the same period in 2025. The increase was driven by a $5.2 million increase in Trio® segment sales, partially offset by a $0.9 million decrease in potash segment sales and a $1.1 million decrease in water sales. As discussed above, following the sale of Intrepid South, we no longer report oilfield solutions as a reportable segment.

Our Trio® segment sales increased $5.2 million, or 6%, in the six months ended June 30, 2026, compared to the same period in 2025. The increase was driven by a $5.1 million increase in Trio® sales and a $0.1 million increase in Trio® segment byproduct sales. Trio® sales increased primarily due to a 10% increase in our Trio® average net realized sales price per ton, driven by continued supportive pricing for the individual nutrient components of Trio®, particularly sulfate and potassium. The increase in Trio® sales was partially offset by a 3% decrease in tons of Trio® sold.

Our total potash segment sales decreased $0.9 million during the six months ended June 30, 2026, compared to the same period in 2025. Potash segment byproduct sales decreased $2.9 million, primarily due to mild winter weather during the first quarter of 2026, which resulted in customers beginning the second quarter of 2026 with higher inventory levels. The decrease in potash segment byproduct sales was partially offset by a $2.0 million increase in potash, driven primarily by a 10% increase in our potash average net realized sales price per ton, as potash list prices to begin 2026 were higher than to begin 2025. The increase in potash sales was partially offset by 4% decrease in tons of potash sold.

Our total byproduct sales, which are recorded in either our potash segment or Trio® segment, decreased $2.8 million during the six months ended June 30, 2026, compared to the same period in 2025. The decrease was driven by a $1.7 million decrease in salt sales and a $1.2 million decrease in magnesium chloride sales, partially offset by an increase of $0.2 million in brine sales. Salt and magnesium chloride sales decreased primarily because mild winter weather and historically low snowfall in the western U.S. reduced demand during the three months ended March 31, 2026, and resulted in customers beginning the second quarter with higher inventory levels.

Cost of Goods Sold

For the six months ended June 30, 2026, total cost of goods sold decreased $4.2 million compared to the same period in 2025. This decrease was primarily driven by a $3.6 million decrease in Trio® segment cost of goods sold and a $1.4 million decrease in other nonreportable segment cost of goods sold, partially offset by a $0.7 million increase in potash segment cost of goods sold.

Cost of goods sold in the Trio® segment decreased 8% for the six months ended June 30, 2026, compared to the same period in 2025. This decrease was driven primarily by a 3% decline in Trio® sales volumes and a decline in Trio® weighted average carrying cost per ton sold. The decrease in weighted average carrying cost per ton sold was primarily driven by the mix of products sold as we sold fewer premium tons, which have a higher weighted-average carrying cost. In addition, Trio® production volume was 9% higher during the six months ended June 30, 2026, compared to the same period in 2025, due to the new continuous miner commissioned in early 2026 and ongoing plant optimization projects. Because a significant portion of our Trio® production costs are fixed, higher production volumes decreased our per-ton production costs and lowered our weighted-average carrying cost per ton sold.

Cost of goods sold in the potash segment increased $0.7 million, or 1%, during the six months ended June 30, 2026, compared to the corresponding period in 2025, notwithstanding a 4% decline in potash sales volumes. This increase was primarily attributable to higher production costs, including depreciation and depletion expense.

Cost of goods sold in the nonreportable other segment decreased by $1.4 million, or 81%, during the six months ended June 30, 2026, compared to the corresponding period in 2025. The decrease was primarily attributable to lower water sales from our Caprock water rights, which resulted in a 73% decline in sales within the nonreportable other segment.

Lower of Cost or Net Realizable Value Inventory Adjustments

During the six months ended June 30, 2026, we recorded $1.1 million of lower of cost or net realizable value inventory adjustments in our potash segment, compared to $1.8 million during the corresponding period in 2025. These adjustments were recorded because the weighted-average carrying cost of certain potash products exceeded their estimated net realizable value.