I think the reason the price of Calcium Hypochloride didn’t have a big impact on the OPM is because coal prices shot up like crazy recently (but now they’re calming down). So even though the material cost went up to 73% in 2023 from 67% in 2022, you can see that in the March 2023 quarter, the material cost went down to about 63% and the OPM was around 15%. It seems like the coal price situation is cooling off a bit.
I’m not entirely sure why that happened. Maybe they saw an opportunity to capitalize on the high coal prices? I couldn’t find any information about it in their Annual Report or Credit Reports. It’s a bit puzzling, but sometimes companies make strategic decisions based on market trends.
Disc: Hold a tracking position
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