All statements, other than statements of historical fact, contained herein constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements relate to future events or our future financial performance, and involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include, but are not limited to, the following: general business and economic conditions; uninsured risks and hazards associated with underground mining operations; governmental policies affecting the agricultural industry or highway maintenance programs in localities where the Company or its customers operate; weather conditions; the impact of competitive products; pressure on prices realized by the Company for its products; constraints on supplies of raw materials used in manufacturing certain of the Company's products and the availability of transportation services; capacity constraints limiting the production of certain products; the ability to attract and retain skilled personnel as well as labor relations including without limitation, the impact of work rules, strikes or other disruptions, wage and benefit requirements; difficulties or delays in the development, production, testing and marketing of products; difficulties or delays in receiving required governmental and regulatory approvals; market acceptance issues, including the failure of products to generate anticipated sales levels; the effects of and changes in trade, monetary, environmental and fiscal policies, laws and regulations; foreign exchange rates and fluctuations in those rates; the costs and effects of legal proceedings including environmental and administrative proceedings involving the Company; customer expectations about future potash market prices and availability and agricultural economics; volatility in credit and capital markets, including the risk of customer and counterparty defaults and declining credit availability; changes in tax laws or estimates for tax liabilities; and other risk factors reported in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") as updated quarterly on Form 10-Q.

In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "continue," or the negative of these terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We undertake no duty to update any of the forward-looking statements after the date hereof or to reflect the occurrence of unanticipated events.

Unless the context requires otherwise, references in this quarterly report to the "Company," "Compass," "Compass Minerals," "CMP," "we," "us" and "our" refer to Compass Minerals International, Inc. ("CMI", the parent holding company) and its consolidated subsidiaries.

Critical Accounting Estimates

Preparation of our consolidated financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Management believes the most complex and sensitive judgments result primarily from the need to make estimates about matters that are inherently uncertain. Management's Discussion and Analysis and Note 2 to the Consolidated Financial Statements included in our Annual Report on Form 10-K filed with the SEC on February 20, 2009, describe the significant accounting estimates and policies used in preparation of our consolidated financial statements. Actual results in these areas could differ from management's estimates.

Results of Operations

Deicing products, consisting of deicing salt and magnesium chloride used by highway deicing and consumer and industrial customers, constitute a significant portion of the Company's salt segment sales. Our deicing sales are seasonal and can fluctuate from year to year depending on the severity of the winter season weather in our markets. Inventory management practices are employed to respond to the varying level of demand which impacts our production volumes, the resulting per ton cost of inventory and ultimately profit margins, particularly during the non-winter quarters when we build our inventory levels. During the 2008-2009 winter season, the fourth quarter of 2008 was significantly more severe than normal while the first quarter of 2009 was below normal in our North American markets. By contrast, the 2007 - 2008 winter season in our North American markets was more severe than normal in both quarters. Our U.K. subsidiary experienced a more severe winter in the 2008 - 2009 winter season after a year of significantly milder than normal weather in the 2007 - 2008 winter season.

Our sulfate of potash (SOP) product is used in the production of specialty fertilizers for high-value crops and turf. Our domestic sales of SOP are concentrated in the western and southeastern portions of the United States where some crops and soil conditions favor the use of SOP as a source of potassium nutrients. Consequently, weather patterns and field conditions in these locations can impact the amount of specialty fertilizer sales volumes. Additionally, the demand for and market price of SOP is affected by the broader potash market which is influenced by many factors such as world grain and food supply, changes in consumer diets, general levels of economic activity and government food and agriculture policies around the world.

Economic factors may impact the amount or type of crop grown in certain locations, or the type of fertilizer product used. High-value or chloride-sensitive crop yields and/or quality tend to decline when alternative fertilizers are used. Beginning late in 2007 and throughout much of 2008, the demand for potassium nutrients for crops exceeded the available supply which contributed to a substantial increase in the market price for potash, including SOP. Demand for these products waned in the fourth quarter of 2008 and that has extended through the first half of 2009, as the broad agricultural industry has dealt with the onset of a global economic slowdown and reduced credit availability. There have been recent reports indicating that MOP market pricing has been lowered to some large customers, although pricing is still well above historical pricing levels. Any such pricing decline in MOP would likely translate into lower SOP product pricing, although SOP pricing would be expected to retain its historical premium to MOP.

Our North American salt mines and SOP production facility are near either water or rail transport systems, which reduces our shipping and handling costs when compared to alternative methods of distribution, although shipping and handling costs still account for a relatively large portion of the total delivered cost of our products. The tightening of available transportation services together with higher fuel costs has increased our shipping and handling costs on a per ton basis over the last several years. However, declining oil-based fuel costs beginning late in 2008 and continuing through the first half of 2009 reversed this trend.

Manpower costs, energy costs, packaging, and certain raw material costs, particularly potassium chloride (KCl), a deicing and water conditioning agent and feed-stock used in making a portion of our sulfate of potash fertilizer product, are also significant. The Company's production workforce is typically represented by labor unions with multi-year collective bargaining agreements. Our energy costs result from the consumption of electricity with relatively stable, rate-regulated pricing, and natural gas which can have significant pricing volatility. We manage the pricing volatility of our natural gas purchases with natural gas forward contracts up to 36 months in advance of purchases, helping to reduce the impact of price volatility. We purchase KCl under long-term supply contracts with annual changes in price based on previous year changes in the market price for KCl. The market price for KCl has increased significantly in recent years, causing continued price increases under our contracts, though still below current market due to the annual price adjustment mechanism. Although we cannot predict future changes in market prices for KCl, our per ton costs to purchase KCl have been moderately higher in 2009.

The consolidated financial statements have been prepared to present the historical financial condition and results of operations and cash flows for the Company which include our salt segment, specialty fertilizer segment, our records management business and unallocated corporate activities. The results of operations of the records management business include sales of $2.7 million and $3.2 million for the three months ended June 30, 2009 and 2008, respectively, and $4.8 million and $6.3 million for the six months ended June 30, 2009 and 2008, respectively, and are not material to our consolidated financial statements and consequently, are not included in the table below. The following tables and discussion should be read in conjunction with the information contained in our consolidated financial statements and the accompanying notes included elsewhere in this quarterly report.

                                              Three Months Ended           Six Months Ended
                                                   June 30,                    June 30,
                                              2009          2008          2009          2008
Salt Sales (in millions)
 Salt sales                                $    118.4     $   104.9     $   387.2     $   434.1
 Less: salt shipping and handling                35.2          35.8         123.6         160.1
  Salt product sales                       $     83.2     $    69.1     $   263.6     $   274.0
Salt Sales Volumes (thousands of tons)
 Highway deicing                                1,225         1,108         4,954         6,246
 Consumer and industrial salt                     499           566         1,129         1,328
  Total tons sold                               1,724         1,674         6,083         7,574
Average Salt Sales Price (per ton)
 Highway deicing                           $    37.83     $   30.98     $   44.58     $   42.08
 Consumer and industrial salt                  144.61        124.61        147.38        128.99
 Combined                                       68.71         62.66         63.66         57.32

Specialty Fertilizer (SOP) Sales (in
millions)
 Specialty fertilizer sales                $     38.4     $    53.9     $    76.6     $   101.6
 Less: SOP shipping and handling                  2.3           6.3           4.9          13.2
  Specialty fertilizer product sales       $     36.1     $    47.6     $    71.7     $    88.4
Specialty Fertilizer Sales Volumes
(thousands of tons)                                41           111            78           234
Specialty Fertilizer Average Sales Price
(per ton)                                  $      944     $     485     $     980     $     434

Three Months Ended June 30, 2009 Compared to Three Months Ended June 30, 2008

Sales

Sales for the second quarter of 2009 of $159.5 million decreased $2.5 million, or 2% compared to $162.0 million for the same quarter of 2008. Sales primarily include revenues from the sale of our products, or "product sales," revenues from our records management business, and shipping and handling costs incurred to deliver salt and specialty fertilizer products to our customers. Shipping and handling costs decreased $4.6 million from $42.1 million in second quarter of 2008 to $37.5 million in the second quarter of 2009 due primarily to lower sales volumes during the second quarter of 2009 when compared to the same period of 2008. In addition, the lower price of fuel and transportation services and product mix changes in 2009 have decreased our average per unit cost of shipping and handling products by approximately 5% to our salt customers.

Product sales for the second quarter of 2009 of $119.3 million increased $2.6 million, or 2% compared to $116.7 million for the same period in 2008 reflecting higher salt segment product sales which were partially offset by declines in our specialty fertilizer segment.

Salt product sales for the second quarter of 2009 of $83.2 million increased $14.1 million, or 20% compared to $69.1 million for the same period in 2008 due primarily to higher pricing for salt products which contributed approximately $32 million to product sales. Salt sales volumes in 2009 grew by 0.1 million tons or 3% over 2008 consisting of slightly higher sales volumes for highway deicing products, reflecting an increase in early fill volumes, in some instances ahead of price increases for the next winter season pricing, and higher sales of magnesium chloride for use as a de-dusting agent. These were offset by lower sales volumes related to non-seasonal chemical products due to weakness in the broader economy and consumer and industrial products due primarily to the Company's strategy to maximize the value of its production, which has led the Company to relinquish some lower-value sales. The changing mix of sales volumes unfavorably impacted product sales by approximately $14 million. In addition, the strengthening of the U.S. dollar in the second quarter of 2009 when compared to the prior year exchange rate for the Canadian dollar and British pound sterling, negatively impacted product sales by approximately $4.0 million.

SOP product sales for the second quarter of 2009 of $36.1 million decreased $11.5 million, or 24% compared to $47.6 million for the same period in 2008, as sales volumes declined due to the ongoing effects of the uncertain economy on the agricultural industry and the reluctance of fertilizer customers to purchase potash at historically high prices. The lower sales volumes contributed approximately $30 million to the decline in product sales which was partially offset by price improvements in the second quarter of 2009 which yielded approximately $19 million in additional product sales. Although we have experienced a decline in our sales volumes since the fourth quarter of 2008, we continue to believe the market for fertilizer products over the long-term has responded to factors which have increased worldwide demand for crop nutrients, including the need for improved yields in locations with growing populations and less arable land per capita, and alternative crop uses. Conditions such as these have affected the agricultural markets and the demand for all types of potash fertilizer products, including SOP.

Gross Profit

Gross profit for the second quarter of 2009 of $55.0 million increased $17.9 million or 48% compared to $37.1 million in the second quarter of 2008. As a percent of total sales, 2009 gross margin increased by 11 percentage points, from 23% to 34%. The gross margin for the salt segment contributed approximately $14 million to the increase due to price improvements combined with slightly lower average per unit shipping and handling costs and production costs. The gross margin for the SOP segment contributed approximately $3 million to the increase due to price improvements partially offset by lower sales volumes.

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the second quarter of 2009 of $20.2 million increased $2.0 million, or 11% compared to $18.2 million for the same period of 2008. The increase in expense is primarily due to higher costs for professional services.

Interest Expense

Interest expense for the second quarter of 2009 of $6.6 million decreased $4.4 million compared to $11.0 million for the same period in 2008. This decrease is primarily due to the early extinguishment of $90 million of the Company's 12% Senior Subordinated Discount Notes during 2008, lower interest rates on our floating-rate debt and the refinancing of the remaining balance of the Company's 12% Senior Subordinated Discount Notes with the senior notes ("8% Senior Notes") in June 2009.

Other Expense, Net

In the second quarter of 2009, other expense of $5.9 million includes a $5.0 million charge related to the refinancing of the 12% Senior Subordinated Discount Notes, including tender and other fees of $4.1 million and the write-off of deferred financing fees of $0.9 million. In the second quarter of 2008, other expense of $4.5 million includes a call premium of $4.2 million and a write-off of deferred financing fees of $0.9 million related to the early extinguishment of $70 million of the Company's 12% senior subordinated discount notes. Both periods also include foreign currency exchange losses and interest income.

Income Tax Expense

Income tax expense of $8.2 million for the three months ended June 30, 2009 increased from $1.8 million for the same period in 2008 primarily reflecting a higher level of pre-tax income in 2009. Our income tax provision differs from the U.S. statutory federal income tax rate primarily due to U.S. statutory depletion, state income taxes (net of federal tax benefit), foreign income tax rate differentials, foreign mining taxes, accrued interest and penalties on uncertain tax positions, and interest expense recognition differences for book and tax purposes.

Six Months Ended June 30, 2009 Compared to Six Months Ended June 30, 2008

Sales

Sales for the six months ended June 30, 2009 of $468.6 million decreased $73.4 million, or 14% compared to $542.0 million for the six months ended June 30, 2008. Shipping and handling costs were $128.5 million during the first six months of 2009, a decrease of $44.8 million compared to $173.3 million for the same period in 2008. The decrease in shipping and handling costs primarily reflects the lower sales volumes for the six months ended June 30, 2009 when compared to same period of 2008, and the impact of lower per unit fuel and transportation costs.

Product sales for the six months ended June 30, 2009 of $335.3 million decreased $27.1 million, or 7% compared to $362.4 million for the same period in 2008. This decrease reflects declines in both the salt and specialty fertilizer segments as discussed below.

Salt product sales of $263.6 million for the six months ended June 30, 2009 decreased $10.4 million or 4% compared to $274.0 million in 2008. The milder than normal winter weather in our North American markets during the first quarter of 2009 compared to the more severe weather in the first quarter of 2008 led to lower sales volumes for highway deicing and

consumer and industrial deicing products. In addition, lower sales volumes related to consumer and industrial products due primarily to the Company's strategy to maximize the value of its production, which has led the Company to relinquish some lower-value sales, and non-seasonal chemical products due to weakness in the broader economy, contributed to the sales decline. In the U.K., we experienced more severe than normal winter weather and stronger early fill orders which resulted in higher U.K. sales volumes for the first six months of 2009 when compared to the same period in 2008. Overall, salt segment sales volumes in 2009 declined 1.5 million tons from 2008 levels which decreased sales by approximately $51 million. Price improvements contributed approximately $64 million to product sales. In addition, the strengthening of the U.S. dollar in the first half of 2009 when compared to the prior year exchange rate for the Canadian dollar and British pound sterling, negatively impacted product sales by approximately $23 million.

SOP product sales of $71.7 million for the six months ended June 30, 2009 decreased $16.7 million or 19% over $88.4 million during the same period in 2008, as sales volumes declined due to the ongoing effects of the uncertain economy on the agricultural industry and the reluctance of fertilizer customers to apply potash at historically high prices. The lower sales volumes contributed approximately $59 million to the decline in product sales which was partially offset by price improvements in the first half of 2009 which yielded approximately $43 million in additional product sales.

Gross Profit

Gross profit for the six months ended June 30, 2009 of $170.3 million increased $36.2 million, or 27% compared to $134.1 million for the same period in 2008. As a percent of total sales, 2009 gross margin increased by 11 percentage points, from 25% to 36%. The gross margin for the salt segment contributed approximately $22 million to the increase due to price improvements combined with slightly lower average per unit shipping and handling costs which were partially offset by lower sales volumes. The gross margin for the SOP segment contributed approximately $14 million to the increase due to price improvements partially offset by lower sales volumes.

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the 2009 six month period of $40.9 million increased $3.8 million, or 10% compared to $37.1 million for the same period of 2008. The increase in expense is primarily due to professional services and higher consumer and industrial promotional activities.

Interest Expense

Interest expense for the six months ended June 30, 2009 of $14.1 million decreased $8.9 million compared to $23.0 million for the same period in 2008. This decrease is primarily due to the early extinguishment of $90 million of the Company's 12% Senior Subordinated Discount Notes during 2008 and lower interest rates on our floating-rate debt.

Other expense, net

Other expense of $4.8 million for the six months ended June 30, 2009 primarily includes a $5.0 million charge related to the refinancing of the 12% senior subordinated discount notes, including tender and other fees of $4.1 million and the write-off of deferred financing fees of $0.9 million as well as foreign currency exchange losses. Other expense of $2.6 million for the six months ended June 30, 2008 primarily consists of a call premium of $4.2 million and a write-off of $0.9 million related to the early extinguishment of a portion of the Company's 12% senior subordinated discount notes which were offset by foreign currency exchange gains. Both periods also included interest income.

Income Tax Expense

Income tax expense of $34.8 million for the six months ended June 30, 2009 increased $14.1 million from $20.7 million for the same period in 2008 primarily reflecting the higher level of pre-tax income in 2009. Our income tax provision differs from the U.S. statutory federal income tax rate primarily due to U.S. statutory depletion, state income taxes (net of federal tax benefit), foreign income tax rate differentials, foreign mining taxes, accrued interest and penalties on uncertain tax positions, and interest expense recognition differences for book and tax purposes.

Liquidity and Capital Resources

Historically, we have used cash generated from operations to meet our working capital needs, to fund capital expenditures, to pay dividends and to repay our debt, including principal repayments we have voluntarily made early. When we have not been able to meet our short-term liquidity or capital needs with cash from operations, whether as a result of the seasonality of our business or other causes, we have met those needs with borrowings under our revolving credit facility. We expect to meet the ongoing requirements for debt service, any declared dividends and capital expenditures from these sources. This, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.

Cash and cash equivalents of $66.3 million as of June 30, 2009 increased $31.7 million over December 31, 2008 resulting principally from operating cash flows of $88.3 million generated in the first six months of 2009. We used a portion of those cash flows to fund capital expenditures of $29.1 million, to pay dividends on our common stock of $23.6 million, to pay $6.5 million to refinance our 12% Senior Subordinated Notes in June 2009 and to repay the December 31, 2008 balance of our revolving credit facility of $8.6 million.

As of June 30, 2009, we had $492.7 million of principal indebtedness including $97.5 million of 8% Senior Notes and $395.2 million of term loan borrowings under our senior secured credit agreement. Our senior secured credit agreement also includes a revolving credit facility which provides borrowing capacity up to an aggregate amount of $125.0 million. No amounts were borrowed under our revolving credit facility as of June 30, 2009. We had $9.8 million of outstanding letters of credit as of June 30, 2009 which reduced our borrowing availability to $115.2 million.

In June of 2009, we issued senior notes with an aggregate face amount of $100 million due in 2019 which bear interest at a rate of 8% per year payable semi-annually in June and December. The 8% Senior Notes were issued at a discount at 97.497% of their face value and the carrying value of the debt will accrete to their face value over the notes' term, resulting in an effective interest rate of approximately 8.4%. With the proceeds of the 8% Senior Notes, the Company redeemed $89.6 million of its 12% Senior Subordinated Discount Notes due 2013. In connection with the debt refinancing, the Company paid approximately $4.1 million in call premiums and tender and other fees, and paid $2.4 million of fees that were capitalized as deferred financing costs.

We believe our results of operations and borrowing availability under the revolving credit agreement will allow us to pay cash interest without materially adversely affecting our cash flows or financial condition. In addition, we plan on funding our 2009 capital expenditures primarily from cash on hand at June 30, 2009, cash expected to be generated from operations in 2009 and other financing arrangements, including leasing transactions.

Our debt service obligations could, under certain circumstances, materially affect our financial condition and impair our ability to operate our business or pursue our business strategies. As a holding company, CMI's investments in its operating subsidiaries constitute substantially all of its assets. Consequently, our subsidiaries conduct all of our consolidated operations and own substantially all of our operating assets. The principal source of the cash needed to pay our obligations is the cash generated from our subsidiaries' operations and their borrowings. Our subsidiaries are not obligated to make funds available to CMI. Furthermore, we must remain in compliance with the terms of our senior secured credit facilities, including the total leverage ratio and . . .