0000950170-23-017168 | 10-Q | XBRL Viewer

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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 48,949	$ 63,769
Short-term investments	376,882	330,553
Accounts receivable	60,251	75,494
Allowance for doubtful accounts	(693)	(699)
Accounts receivable, net	59,558	74,795
Inventories:
Finished goods	28,102	28,893
Raw materials	1,530	1,990
Total inventories	29,632	30,883
Supplies, prepaid items and other:
Prepaid insurance	12,271	17,429
Precious metals	14,474	13,323
Supplies	28,570	27,501
Other	9,491	8,346
Total supplies, prepaid items and other	64,806	66,599
Total current assets	579,827	566,599
Property, plant and equipment, net	842,925	848,661
Other assets:
Operating lease assets	21,321	22,682
Intangible and other assets, net	1,697	1,877
Total other assets	23,018	24,559
Total assets	1,445,770	1,439,819
Current liabilities:
Accounts payable	68,341	78,182
Short-term financing	10,168	16,134
Accrued and other liabilities	43,617	38,470
Current portion of long-term debt	8,544	9,522
Total current liabilities	130,670	142,308
Long-term debt, net	702,071	702,733
Noncurrent operating lease liabilities	13,460	14,896
Other noncurrent accrued and other liabilities	522	522
Deferred income taxes	69,095	63,487
Commitments and contingencies (Note 5)
Stockholders' equity:
Common stock, $.10 par value; 150 million shares authorized, 91.2 million shares issued	9,117	9,117
Capital in excess of par value	497,216	497,179
Retained earnings	214,993	199,092
Stockholders equity including treasury stock	721,326	705,388
Less treasury stock, at cost:
Common stock, 15.0 million shares (14.9 million shares at December 31, 2022)	191,374	189,515
Total stockholders' equity	529,952	515,873
Total Liabilities and Stockholders' equity	$ 1,445,770	$ 1,439,819

Income Per Common Share - Antidilutive Securities Excluded from Computation of Diluted Net Income Per Common Share (Detail) - shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	408,301	13,000
Restricted Stock and Stock Units [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	395,301
Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	13,000	13,000

Derivatives, Hedges and Financial Instruments - Summary of Financial Instruments (Parenthetical) (Detail)	Mar. 31, 2023	Dec. 31, 2022
Offsetting [Abstract]
Quoted price	88.25	91.00

Supplemental Cash Flow Information - Additional Information Relating to Cash Flow Activities (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash payments (refunds) for:
Income taxes, net	$ 20
Noncash investing and financing activities:
Accounts receivable, supplies, other assets, accounts payable and accrued liabilities associated with additions of property, plant and equipment	$ 21,761	$ 17,295
Accounts payable associated with debt-related costs		$ 741

Related Party Transactions - Additional Information (Detail) $ in Millions	Mar. 31, 2023 USD ($)
Eldridge [Member] \| New Senior Secured Notes [Member]
Related Party Transaction [Line Items]
Debt issued - principal amount	$ 30

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2023	Apr. 28, 2023
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Entity Registrant Name	LSB Industries, Inc.
Entity Central Index Key	0000060714
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Shell Company	false
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity File Number	1-7677
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	73-1015226
Entity Address, Address Line One	3503 NW 63rd Street
Entity Address, Address Line Two	Suite 500
Entity Address, City or Town	Oklahoma City
Entity Address, State or Province	OK
Entity Address, Postal Zip Code	73116
City Area Code	405
Local Phone Number	235-4546
Document Quarterly Report	true
Document Transition Report	false
Entity Common Stock, Shares Outstanding		76,129,079
Common Stock [Member]
Document Information [Line Items]
Trading Symbol	LXU
Title of 12(b) Security	Common Stock, Par Value $.10
Security Exchange Name	NYSE
Preferred Stock [Member]
Document Information [Line Items]
No Trading Symbol Flag	true
Title of 12(b) Security	Preferred Stock Purchase Rights
Security Exchange Name	NYSE

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Net sales	$ 180,964	$ 198,981
Cost of sales	139,359	108,251
Gross profit	41,605	90,730
Selling, general and administrative expense	9,867	10,935
Other expense (income), net	1,203	(176)
Operating income	30,535	79,971
Interest expense, net	12,212	9,955
Non-operating other expense (income), net	(3,476)	135
Income before provision for income taxes	21,799	69,881
Provision for income taxes	5,898	11,115
Net income	$ 15,901	$ 58,766
Basic:
Net income	$ 0.21	$ 0.66
Diluted:
Net income	$ 0.21	$ 0.65

Current and Noncurrent Accrued and Other Liabilities - Summary of Current and Noncurrent Accrued and Other Liabilities (Detail) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Payables And Accruals [Abstract]
Accrued interest	$ 22,212	$ 11,196
Current portion of operating lease liabilities	$ 7,869	$ 7,259
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration]	Current portion of accrued and other liabilities	Current portion of accrued and other liabilities
Accrued payroll and benefits	$ 4,468	$ 12,440
Other	9,590	8,097
Total current and noncurrent accrued liabilities	44,139	38,992
Less noncurrent portion	522	522
Current portion of accrued and other liabilities	$ 43,617	$ 38,470

Net Sales - Summary of Net Sales Disaggregated by Principal Markets (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Net sales:
Net sales	$ 180,964	$ 198,981
Chemical
Net sales:
Net sales	180,964	198,981
Chemical \| AN and Nitric Acid
Net sales:
Net sales	58,272	71,800
Chemical \| Urea ammonium nitrate (UAN)
Net sales:
Net sales	46,590	56,569
Chemical \| Ammonia
Net sales:
Net sales	63,415	59,342
Chemical \| Other
Net sales:
Net sales	$ 12,687	$ 11,270

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

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+ Details

Net Sales

3 Months Ended

Mar. 31, 2023

Revenue From Contract With Customer [Abstract]

Net Sales

8. Net Sales

Disaggregated Net Sales

We primarily derive our revenues from the sales of various chemical products. The Company’s net sales disaggregation is consistent with other financial information utilized or provided outside of our condensed consolidated financial statements. With our continued focus on optimizing our commercial strategy and product mix going forward we will report revenue by product as opposed to the end market. Accordingly, this approach is reflected in disaggregated net sales, mirroring how the Company manages its net sales by product through contracts with customers.

The following table presents our net sales disaggregated by our principal product types:


	Three Months Ended
	March 31,
	2023		2022
	(In Thousands)
Net sales:
AN & Nitric Acid	$	58,272	$	71,800
Urea ammonium nitrate (UAN)		46,590		56,569
Ammonia		63,415		59,342
Other		12,687		11,270
Total net sales	$	180,964	$	198,981

Other Information

Although most of our contracts have an original expected duration of one year or less, for our contracts with a duration greater than one year at contract inception, the average remaining expected duration was approximately 30 months at March 31, 2023.

Liabilities associated with contracts with customers (contract liabilities) primarily relate to deferred revenue and customer deposits associated with cash payments received in advance from customers for volume shortfall charges and product shipments. We had approximately $3.8 million, $2.0 million and $1.6 million of contract liabilities as of March 31, 2023, December 31, 2022 and December 31, 2021, respectively. For the three months ended March 31, 2023 and 2022, revenues of $0.6 million and $1.4 million, respectively, were recognized and included in the balance at the beginning of the respective period. We had approximately $86.9 million of accounts receivable as of December 31, 2021.

For most of our contracts with customers, the transaction price from the inception of a contract is constrained to a short period of time (generally one month) as these contracts contain terms with variable consideration related to both price and quantity. At March 31, 2023, we have remaining performance obligations with certain customer contracts, excluding contracts with original durations of less than one year and for service contracts for which we have elected the practical expedient for consideration recognized in revenue as invoiced. The remaining performance obligations totals approximately $92.1 million, of which approximately 60% of this amount relates to 2023 through 2025, approximately 26% relates to 2026 through 2027, with the remainder thereafter.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

Net Sales (Tables)

3 Months Ended

Mar. 31, 2023

Revenue From Contract With Customer [Abstract]

Summary of Net Sales Disaggregated by Principal Markets

The following table presents our net sales disaggregated by our principal product types:


	Three Months Ended
	March 31,
	2023		2022
	(In Thousands)
Net sales:
AN & Nitric Acid	$	58,272	$	71,800
Urea ammonium nitrate (UAN)		46,590		56,569
Ammonia		63,415		59,342
Other		12,687		11,270
Total net sales	$	180,964	$	198,981

Income Taxes (Tables)

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

Provision for Income Taxes

Provision for income taxes is as follows:


	Three Months Ended
	March 31,
	2023		2022
	(In Thousands)
Current:
Federal	$	—	$	—
State		290		292
Total Current	$	290	$	292

Deferred:
Federal	$	4,622	$	11,385
State		986		(562	)
Total Deferred	$	5,608	$	10,823
Provision for income taxes	$	5,898	$	11,115

Net Sales - Additional Information (Detail 1)	3 Months Ended
Net Sales - Additional Information (Detail 1)	Mar. 31, 2023
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-04-01
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]
Revenue, remaining performance obligation, expected timing of satisfaction, percent	60.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	33 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2026-01-01
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]
Revenue, remaining performance obligation, expected timing of satisfaction, percent	26.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	2 years

Supplemental Cash Flow Information

3 Months Ended

Mar. 31, 2023

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Information

10. Supplemental Cash Flow Information

The following provides additional information relating to cash flow activities:


	Three Months Ended
	March 31,
	2023		2022
	(In Thousands)
Cash payments (refunds) for:
Income taxes, net	$	20	$	—
Noncash investing and financing activities:
Accounts receivable, supplies, other assets, accounts payable and accrued liabilities associated with additions of property, plant and equipment	$	21,761	$	17,295
Accounts payable associated with debt-related costs	$	—	$	741

Related Party Transactions

3 Months Ended

Mar. 31, 2023

Related Party Transactions

9. Related Party Transactions

As of March 31, 2023, we have two separate outstanding financing arrangements by an affiliate of Eldridge as discussed in footnotes (C) and (D) of Note 4. An affiliate of Eldridge holds $30 million of the New Notes.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) (Unaudited)	Mar. 31, 2023
6.25% Senior Secured Notes due 2028 [Member]
Debt instrument, interest rate	6.25%

Long-Term Debt - Schedule of Revolving Credit Facility and Long-Term Debt (Detail) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Unamortized debt issuance costs	$ (11,780)	$ (12,321)
Long-term debt	710,615	712,255
Less current portion of long-term debt	8,544	9,522
Long-term debt due after one year, net	702,071	702,733
6.25% Senior Secured Notes Due 2028 [Member]
Debt Instrument [Line Items]
Debt carrying amount	700,000	700,000
8.32% Secured Financing Due 2023 [Member]
Debt Instrument [Line Items]
Debt carrying amount	3,292	4,161
8.75% Secured Financing Due 2025 [Member]
Debt Instrument [Line Items]
Debt carrying amount	18,023	19,277
Other [Member]
Debt Instrument [Line Items]
Debt carrying amount	$ 1,080	$ 1,138

Commitments and Contingencies - Additional Information (Detail) MMBTU in Millions	3 Months Ended
	Mar. 31, 2023 USD ($) MMBTU Settlement $ / MMBTU	Mar. 31, 2020 USD ($)	Mar. 31, 2016 USD ($)
Commitments And Contingencies [Line Items]
Accrued liabilities for environmental matters	$ 500,000
Percentage of payment of investigation costs agreed by Hallowell Facility	50.00%
Insurance coverage of general liability and auto liability risks	$ 100,000,000
Product liability deductible per claim	$ 250,000
Confidential settlement agreement with family groups \| Settlement	3
Liability reserve	$ 0
Global Industrial Inc [Member]
Commitments And Contingencies [Line Items]
Amount awarded for labor, service, materials and other		$ 7,400,000
Prejudgment interest		$ 1,300,000
Percentage of accrue post judgement interest		4.25%
Leidos Constructors, LLC [Member] \| Global Industrial Inc [Member] \| Accounts Payable [Member]
Commitments And Contingencies [Line Items]
Claim amount not approved for payment		$ 3,500,000	$ 3,500,000
Natural Gas Purchase Commitments [Member]
Commitments And Contingencies [Line Items]
Natural gas purchase commitments volume \| MMBTU	21.1
Weighted average cost of natural gas per unit \| $ / MMBTU	3.60
Weighted average purchase price of natural gas	$ 75,900,000
Weighted average natural gas market value per unit \| $ / MMBTU	2.52
Weighted average natural gas market value	$ 53,100,000

Derivatives, Hedges and Financial Instruments - Summary of Financial Instruments (Detail) - Senior Notes - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Carrying Amount	$ 700	$ 700
Estimated Fair Value	$ 618	$ 637

Current and Noncurrent Accrued and Other Liabilities

3 Months Ended

Mar. 31, 2023

Other Liabilities Disclosure [Abstract]

Current and Noncurrent Accrued and Other Liabilities

3. Current and Noncurrent Accrued and Other Liabilities


	March 31,		December 31,
	2023		2022
	(In Thousands)
Accrued interest	$	22,212	$	11,196
Current portion of operating lease liabilities		7,869		7,259
Accrued payroll and benefits		4,468		12,440
Other		9,590		8,097
		44,139		38,992
Less noncurrent portion		522		522
Current portion of accrued and other liabilities	$	43,617	$	38,470

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock [Member]	Treasury Stock-Common [Member]	Capital in Excess of Par Value [Member]	Retained Earnings (Accumulated Deficit) [Member]
Balance at Dec. 31, 2021	$ 460,490	$ 9,117	$ (10,533)	$ 493,161	$ (31,255)
Balance, shares at Dec. 31, 2021		91,168	(1,375)
Net income	58,766				58,766
Stock-based compensation	803			803
Other	(1,871)		$ (1,871)
Other, Shares			(229)
Balance at Mar. 31, 2022	518,188	$ 9,117	$ (12,404)	493,964	27,511
Balance, shares at Mar. 31, 2022		91,168	(1,604)
Balance at Dec. 31, 2022	515,873	$ 9,117	$ (189,515)	497,179	199,092
Balance, shares at Dec. 31, 2022		91,168	(14,888)
Net income	15,901				15,901
Stock-based compensation	719			719
Shares issued restricted stock units			$ 682	(682)
Shares issued restricted stock units, shares			53
Shares withheld restricted stock and restricted stock units vesting	(2,541)		$ (2,541)
Shares withheld restricted stock and restricted stock units vesting, shares			(204)
Balance at Mar. 31, 2023	$ 529,952	$ 9,117	$ (191,374)	$ 497,216	$ 214,993
Balance, shares at Mar. 31, 2023		91,168	(15,039)

Long-Term Debt (Tables)

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Schedule of Revolving Credit Facility and Long-Term Debt

Our long-term debt consists of the following:


	March 31,			December 31,
	2023			2022
	(In Thousands)
Working Capital Revolver Loan, with a current interest rate of 8.50% (A)	$	—		$	—
Senior Secured Notes due 2028, with an interest rate of 6.25% (B)		700,000			700,000
Secured Financing due 2023, with an interest rate of 8.32% (C)		3,292			4,161
Secured Financing due 2025, with an interest rate of 8.75% (D)		18,023			19,277
Other		1,080			1,138
Unamortized debt issuance costs		(11,780	)		(12,321	)
		710,615			712,255
Less current portion of long-term debt		8,544			9,522
Long-term debt due after one year, net	$	702,071		$	702,733

(A)

Our revolving credit facility, as amended (the “Working Capital Revolver Loan”), provides for advances up to $65 million (the “Maximum Revolver Amount”), based on specific percentages of eligible accounts receivable and inventories and up to $10 million of letters of credit, the outstanding amount as of March 31, 2023, was $0.9 million, which reduces the amount available for borrowing under the Working Capital Revolver Loan. At March 31, 2023, our available borrowings under our Working Capital Revolver Loan were approximately $62.3 million, based on our eligible collateral, less outstanding letters of credit and loan balance. The maturity date of the Working Capital Revolver Loan is on the earlier of (i) the date that is 90 days prior to the earliest stated maturity date of the Senior Secured Notes (unless refinanced or repaid) and (ii) February 26, 2024. Subject to certain conditions and subject to lender approval, the Maximum Revolver Amount may increase up to an additional $10 million. The Working Capital Revolver Loan also provides for a springing financial covenant (the “Financial Covenant”), which requires that, if the borrowing availability is less than 10.0% of the total revolver commitments, then the borrowers must maintain a minimum fixed charge coverage ratio of not less than 1.00 to 1.00. The Financial Covenant, if triggered, is tested monthly.

(B)

On October 14, 2021, LSB completed the issuance and sale of $500 million aggregate principal amount of the Notes of its 6.25% Senior Secured Notes due 2028 (the “Notes”), pursuant to an indenture (the “Indenture”), dated as of October 14, 2021. The Notes were issued at a price equal to 100% of their face value.

On March 8, 2022, LSB completed the issuance and sale of an additional $200 million aggregate principal amount of the Notes (the “New Notes”), which were issued pursuant to the Indenture (the Notes together with the New Notes, the “Senior Secured Notes”). The New Notes were issued at a price equal to 100% of their face value, plus accrued interest from October 14, 2021 to March 7, 2022.

The Senior Secured Notes mature on October 15, 2028. Interest is to be paid in arrears on May 15 and October 15.

(C)

El Dorado Chemical Company (“EDC”), one of our subsidiaries, is party to a secured financing arrangement with an affiliate of Eldridge. Principal and interest are payable in 48 equal monthly installments with a final balloon payment of approximately $3 million due in June 2023. The final balloon payment was repaid in April 2023.

(D)

In August 2020, El Dorado Ammonia L.L.C. (“EDA”), one of our subsidiaries, entered into a $30 million secured financing arrangement with an affiliate of Eldridge. Beginning in September 2020, principal and interest is payable in 60 equal monthly installments with a final balloon payment of approximately $5 million due in August 2025. This financing arrangement is secured by an ammonia storage tank and is guaranteed by LSB.

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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+ Details

Derivatives, Hedges and Financial Instruments

3 Months Ended

Mar. 31, 2023

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Derivatives, Hedges and Financial Instruments

6. Derivatives, Hedges and Financial Instruments

Natural Gas Contracts

Periodically, we entered into certain forward natural gas contracts, which are accounted for on a mark-to-market basis. We are utilizing these natural gas contracts as economic hedges for risk management purposes but are not designated as hedging instruments. At March 31, 2023 and December 31, 2022, we had no outstanding natural gas contracts accounted for on a mark-to-market basis. When present the valuations of the natural gas contracts are classified as Level 2.

Financial Instruments

At March 31, 2023 and December 31, 2022, we did not have any financial instruments with fair values materially different from their carrying amounts (which excludes issuance costs, if applicable) except for our Senior Secured Notes included in the table below. The carrying value of our Senior Secured Notes approximates fair value and is classified as a Level 2 fair value measurement. The fair value of financial instruments is not indicative of the overall fair value of our assets and liabilities since financial instruments do not include all assets, including intangibles and all liabilities.


	March 31, 2023				December 31, 2022
	Carrying		Estimated		Carrying		Estimated
	Amount		Fair Value		Amount		Fair Value
	(In Millions)
Senior Secured Notes (1)	$	700	$	618	$	700	$	637

Based on a quoted price of 88.25 at March 31, 2023 and 91.00 at December 31, 2022.

Supplemental Cash Flow Information (Tables)

3 Months Ended

Mar. 31, 2023

Supplemental Cash Flow Elements [Abstract]

Additional Information Relating to Cash Flow Activities

The following provides additional information relating to cash flow activities:


	Three Months Ended
	March 31,
	2023		2022
	(In Thousands)
Cash payments (refunds) for:
Income taxes, net	$	20	$	—
Noncash investing and financing activities:
Accounts receivable, supplies, other assets, accounts payable and accrued liabilities associated with additions of property, plant and equipment	$	21,761	$	17,295
Accounts payable associated with debt-related costs	$	—	$	741

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities
Net income	$ 15,901	$ 58,766
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes	5,608	10,823
Depreciation and amortization of property, plant and equipment	17,439	17,197
Stock-based compensation	719	803
Other	1,223	946
Cash provided (used) by changes in assets and liabilities:
Accounts receivable	15,418	(11,707)
Inventories	1,251	(10,817)
Prepaid insurance	5,158	3,687
Supplies, prepaid items and other	(4,455)	(6,253)
Accounts payable	(4,861)	10,003
Accrued interest	10,905	13,618
Other assets and other liabilities	(5,059)	(1,574)
Net cash provided by operating activities	59,247	85,492
Cash flows from investing activities
Expenditures for property, plant and equipment	(18,437)	(8,254)
Proceeds from short-term investments	88,707
Purchases of short-term investments	(133,660)	(89,311)
Other investing activities	11	51
Net cash used by investing activities	(63,379)	(97,514)
Cash flows from financing activities
Net proceeds from 6.25% senior secured notes		200,000
Payments on other long-term debt	(2,180)	(6,912)
Payments on short-term financing	(5,967)	(2,805)
Payments of debt-related costs, including extinguishment costs		(4,102)
Other financing activities	(2,541)	(2,004)
Net cash provided (used) by financing activities	(10,688)	184,177
Net increase (decrease) in cash and cash equivalents	(14,820)	172,155
Cash and cash equivalents at beginning of period	63,769	82,144
Cash and cash equivalents at end of period	$ 48,949	$ 254,299

Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

1. Summary of Significant Accounting Policies

The accompanying unaudited interim financial statements and notes of LSB have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Pursuant to such rules and regulations, certain disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted. The accompanying unaudited interim financial statements and notes should be read in conjunction with the financial statements and notes included in the Company’s Form 10-K for the year ended December 31, 2022 (our “2022 Form 10-K”), filed with the SEC on February 23, 2023. The accompanying unaudited interim financial statements in this report reflect all adjustments that are, in the opinion of management, necessary for a fair statement of the Company’s results of operations and cash flows for the three-month periods ended March 31, 2023 and 2022 and the Company’s financial position as of March 31, 2023.

Basis of Consolidation – LSB and its subsidiaries are consolidated in the accompanying condensed consolidated financial statements. LSB is a holding company with no significant operations or assets other than cash, cash equivalents, short-term investments and investments in its subsidiaries. All material intercompany accounts and transactions have been eliminated. Certain prior period amounts reported in our condensed consolidated financial statements and notes thereto have been reclassified to conform to current period presentation.

Nature of Business – We are engaged in the manufacture and sale of chemical products. The chemical products we primarily manufacture, market and sell are ammonia, fertilizer grade ammonium nitrate (“AN” and “HDAN”) and urea ammonium nitrate ("UAN") for agricultural applications, high purity and commercial grade ammonia, high purity AN, sulfuric acids, concentrated, blended and regular nitric acid, mixed nitrating acids, carbon dioxide and diesel exhaust fluid for industrial applications and industrial grade AN (“LDAN”) and solutions for the mining industry. We manufacture and distribute our products in four facilities; three of which we own and are located in El Dorado, Arkansas (the “El Dorado Facility”); Cherokee, Alabama (the “Cherokee Facility”); and Pryor, Oklahoma (the “Pryor Facility”); and one of which we operate on behalf of Covestro in Baytown, Texas.

Sales to customers include farmers, ranchers, fertilizer dealers and distributors primarily in the ranch land and grain production markets in the United States (“U.S.”); industrial users of acids throughout the U.S. and parts of Canada; and explosive manufacturers in the U.S. and parts of Mexico, Canada and the Caribbean.

These interim results are not necessarily indicative of results for a full year due, in part, to the seasonality of our sales of agricultural products and the timing of performing our major plant maintenance activities. Our selling seasons for agricultural products are primarily during the spring and fall planting seasons, which typically extend from March through June and from September through November.

Use of Estimates – The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Short-Term Investments - Investments, which consist of U.S. treasury bills with an original maturity up to and less than 52 weeks, are considered short-term investments and are classified as Level 1. We plan to hold these investments to maturity and have a history of holding investments to maturity. These investments are carried at cost which approximated fair value for the period ended March 31, 2023. Due to the nature of these investments, as U.S. treasury securities, no impairment is anticipated. Our estimate of expected losses is incorporated into the review of the investments' fair value quarterly.

Accounts Receivable – Our accounts receivable are presented at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts to reflect any estimate of expected loss anticipated on accounts receivable balances. Our estimate is based on historical experience and periodic assessment of outstanding accounts receivable, particularly those accounts that are past due (based upon the terms of the sale). Our periodic assessment is based on our best estimate of amounts that are not recoverable which includes a present collectability review and forward looking assessment, where applicable.

Equity Awards – Equity award transactions with employees are measured based on the estimated fair value of the equity awards issued. For equity awards with service conditions that have a graded vesting period, we recognize compensation cost on a straight-line basis over the requisite service period for the entire award. Forfeitures are accounted for as they occur. We may issue new shares of common stock or may use treasury shares associated with the equity awards.

In January 2023, the compensation committee of our Board of Directors (“Board”) approved the grant of 171,641 shares of time-based restricted stock units and 171,641 shares of performance-based restricted stock units to certain executives and employees under our 2016 Long Term Incentive Plan (as Amended and Restated on March 4, 2021). The time-based restricted stock units will vest at the end of each one-year period at the rate of one-third per year for three years. The performance-based restricted stock units will vest on the third anniversary of the grant date subject to the achievement of a market metric established by the Board as set out in the grant. Upon the third anniversary the grants may be modified in a range between 0% and 200% based upon achievement of the market metric. The

unvested restricted units carry dividend and voting rights contingent upon the vesting and lapsing of restriction. Sales of these units are restricted prior to the date of vesting. Pursuant to the terms of the underlying restricted stock unit agreements, unvested restricted shares will immediately vest upon the occurrence of a change in control (as defined by agreement), or a certain portion will immediately vest upon termination without cause or death.

Contingencies – Certain conditions may exist which may result in a loss, but which will only be resolved when future events occur. We and our legal counsel assess such contingent liabilities and such assessment inherently involves an exercise of judgment. If the assessment of a contingency indicates that it is probable that a loss has been incurred, we would accrue for such contingent losses when such losses can be reasonably estimated. If the assessment indicates that a potentially material loss contingency is not probable but reasonably possible, or is probable but cannot be estimated, the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Estimates of potential legal fees and other directly related costs associated with contingencies are not accrued but rather are expensed as incurred. Loss contingency liabilities are included in current and noncurrent accrued and other liabilities and are based on current estimates that may be revised in the near term. In addition, we recognize contingent gains when such gains are realized or when the contingencies have been resolved (generally at the time a settlement has been reached).

Derivatives, Hedges and Financial Instruments – Derivatives are recognized in the balance sheet and measured at fair value. Changes in fair value of derivatives are recorded in results of operations unless the normal purchase or sale exceptions apply, or hedge accounting is elected.

The fair value amounts recognized for our derivative contracts executed with the same counterparty under a master netting arrangement may be offset. We have the choice to offset or not, but that choice must be applied consistently. A master netting arrangement exists if the reporting entity has multiple contracts with a single counterparty that are subject to a contractual agreement that provides for the net settlement of all contracts through a single payment in a single currency in the event of default on or termination of any one contract. Offsetting the fair values recognized for the derivative contracts outstanding with a single counterparty results in the net fair value of the transactions reported as an asset or a liability in the balance sheet. When applicable, we present the fair values of our derivative contracts under master netting agreements using a gross fair value presentation.

Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date:

Level 1 - Valuations of contracts classified as Level 1 are based on quoted prices in active markets for identical contracts.

Level 2 - Valuations of contracts classified as Level 2 are based on quoted prices for similar contracts and valuation inputs other than quoted prices that are observable for these contracts.

Level 3 - Valuations of assets and liabilities classified as Level 3 are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.

Recently Issued Accounting Pronouncements

Changes to U.S. GAAP are established by the FASB in the form of accounting standards updates (“ASUs”) to the FASB’s Accounting Standards Codification. We consider the applicability and impact of all ASUs. ASUs issued and outstanding or that became effective since January 1, 2023 through the date of these financial statements were assessed and determined not to be applicable or are expected to have minimal impact on our condensed consolidated financial position and results of operations.

Income Taxes

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

7. Income Taxes

Provision for income taxes is as follows:


	Three Months Ended
	March 31,
	2023		2022
	(In Thousands)
Current:
Federal	$	—	$	—
State		290		292
Total Current	$	290	$	292

Deferred:
Federal	$	4,622	$	11,385
State		986		(562	)
Total Deferred	$	5,608	$	10,823
Provision for income taxes	$	5,898	$	11,115

The tax provision for the three months ended March 31, 2023, was $5.9 million (27.1% provision on pre-tax income). The tax provision for the three months ended March 31, 2022, was $11.1 million (15.9% provision on pre-tax income). For 2023, the effective tax rate is higher than the statutory tax rate primarily due to state taxes, including state valuation allowances on certain newly generated state tax attributes. For 2022, the effective tax rate was less than the statutory tax rate primarily due to the impact of the valuation allowances.

We considered both positive and negative evidence in our determination of the need for valuation allowances for deferred tax assets. Information evaluated includes our financial position and results of operations for the current and preceding years, the availability of deferred tax liabilities and tax carrybacks, as well as an evaluation of currently available information about future years. Valuation allowances are reflective of our quarterly analysis of the four sources of taxable income, including the calculation of the reversal of existing tax assets and liabilities, the impact of financing activities and our quarterly results. Based on our analysis, we have determined that it is more-likely-than-not that all of our federal deferred tax assets and a portion of our state deferred tax assets will be utilized. We estimate an approximately $1.7 million increase in the related valuation allowance associated with these state deferred tax assets will be recorded during the year as part of the estimated annual effective tax rate applied to ordinary income.

We will continue to evaluate both the positive and negative evidence on a quarterly basis in determining the need for a valuation allowance with respect to our deferred tax assets. Changes in positive and negative evidence, including differences between estimated and actual results, could result in changes in the valuation of our deferred tax assets that could have a material impact on our consolidated financial statements. Changes in existing tax laws could also affect actual tax results and the realization of deferred tax assets over time.

LSB and certain of its subsidiaries file income tax returns in the U.S. federal jurisdiction and various state jurisdictions. With few exceptions, the 2019-2022 years remain open for all purposes of examination by the U.S. Internal Revenue Service (“IRS”) and other major tax jurisdictions. Additionally, the 2013-2018 years remain subject to examination for determining the amount of net operating loss and other carryforwards.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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+ Details

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2023
Accounting Policies [Abstract]
Basis of Consolidation	Basis of Consolidation – LSB and its subsidiaries are consolidated in the accompanying condensed consolidated financial statements. LSB is a holding company with no significant operations or assets other than cash, cash equivalents, short-term investments and investments in its subsidiaries. All material intercompany accounts and transactions have been eliminated. Certain prior period amounts reported in our condensed consolidated financial statements and notes thereto have been reclassified to conform to current period presentation.
Nature of Business	Nature of Business – We are engaged in the manufacture and sale of chemical products. The chemical products we primarily manufacture, market and sell are ammonia, fertilizer grade ammonium nitrate (“AN” and “HDAN”) and urea ammonium nitrate ("UAN") for agricultural applications, high purity and commercial grade ammonia, high purity AN, sulfuric acids, concentrated, blended and regular nitric acid, mixed nitrating acids, carbon dioxide and diesel exhaust fluid for industrial applications and industrial grade AN (“LDAN”) and solutions for the mining industry. We manufacture and distribute our products in four facilities; three of which we own and are located in El Dorado, Arkansas (the “El Dorado Facility”); Cherokee, Alabama (the “Cherokee Facility”); and Pryor, Oklahoma (the “Pryor Facility”); and one of which we operate on behalf of Covestro in Baytown, Texas. Sales to customers include farmers, ranchers, fertilizer dealers and distributors primarily in the ranch land and grain production markets in the United States (“U.S.”); industrial users of acids throughout the U.S. and parts of Canada; and explosive manufacturers in the U.S. and parts of Mexico, Canada and the Caribbean. These interim results are not necessarily indicative of results for a full year due, in part, to the seasonality of our sales of agricultural products and the timing of performing our major plant maintenance activities. Our selling seasons for agricultural products are primarily during the spring and fall planting seasons, which typically extend from March through June and from September through November.
Use of Estimates	Use of Estimates – The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Short-Term Investments	Short-Term Investments - Investments, which consist of U.S. treasury bills with an original maturity up to and less than 52 weeks, are considered short-term investments and are classified as Level 1. We plan to hold these investments to maturity and have a history of holding investments to maturity. These investments are carried at cost which approximated fair value for the period ended March 31, 2023. Due to the nature of these investments, as U.S. treasury securities, no impairment is anticipated. Our estimate of expected losses is incorporated into the review of the investments' fair value quarterly.
Accounts Receivable	Accounts Receivable – Our accounts receivable are presented at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts to reflect any estimate of expected loss anticipated on accounts receivable balances. Our estimate is based on historical experience and periodic assessment of outstanding accounts receivable, particularly those accounts that are past due (based upon the terms of the sale). Our periodic assessment is based on our best estimate of amounts that are not recoverable which includes a present collectability review and forward looking assessment, where applicable.
Equity Awards	Equity Awards – Equity award transactions with employees are measured based on the estimated fair value of the equity awards issued. For equity awards with service conditions that have a graded vesting period, we recognize compensation cost on a straight-line basis over the requisite service period for the entire award. Forfeitures are accounted for as they occur. We may issue new shares of common stock or may use treasury shares associated with the equity awards. In January 2023, the compensation committee of our Board of Directors (“Board”) approved the grant of 171,641 shares of time-based restricted stock units and 171,641 shares of performance-based restricted stock units to certain executives and employees under our 2016 Long Term Incentive Plan (as Amended and Restated on March 4, 2021). The time-based restricted stock units will vest at the end of each one-year period at the rate of one-third per year for three years. The performance-based restricted stock units will vest on the third anniversary of the grant date subject to the achievement of a market metric established by the Board as set out in the grant. Upon the third anniversary the grants may be modified in a range between 0% and 200% based upon achievement of the market metric. The unvested restricted units carry dividend and voting rights contingent upon the vesting and lapsing of restriction. Sales of these units are restricted prior to the date of vesting. Pursuant to the terms of the underlying restricted stock unit agreements, unvested restricted shares will immediately vest upon the occurrence of a change in control (as defined by agreement), or a certain portion will immediately vest upon termination without cause or death.
Contingencies	Contingencies – Certain conditions may exist which may result in a loss, but which will only be resolved when future events occur. We and our legal counsel assess such contingent liabilities and such assessment inherently involves an exercise of judgment. If the assessment of a contingency indicates that it is probable that a loss has been incurred, we would accrue for such contingent losses when such losses can be reasonably estimated. If the assessment indicates that a potentially material loss contingency is not probable but reasonably possible, or is probable but cannot be estimated, the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Estimates of potential legal fees and other directly related costs associated with contingencies are not accrued but rather are expensed as incurred. Loss contingency liabilities are included in current and noncurrent accrued and other liabilities and are based on current estimates that may be revised in the near term. In addition, we recognize contingent gains when such gains are realized or when the contingencies have been resolved (generally at the time a settlement has been reached).
Derivatives, Hedges and Financial Instruments	Derivatives, Hedges and Financial Instruments – Derivatives are recognized in the balance sheet and measured at fair value. Changes in fair value of derivatives are recorded in results of operations unless the normal purchase or sale exceptions apply, or hedge accounting is elected. The fair value amounts recognized for our derivative contracts executed with the same counterparty under a master netting arrangement may be offset. We have the choice to offset or not, but that choice must be applied consistently. A master netting arrangement exists if the reporting entity has multiple contracts with a single counterparty that are subject to a contractual agreement that provides for the net settlement of all contracts through a single payment in a single currency in the event of default on or termination of any one contract. Offsetting the fair values recognized for the derivative contracts outstanding with a single counterparty results in the net fair value of the transactions reported as an asset or a liability in the balance sheet. When applicable, we present the fair values of our derivative contracts under master netting agreements using a gross fair value presentation. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date: Level 1 - Valuations of contracts classified as Level 1 are based on quoted prices in active markets for identical contracts. Level 2 - Valuations of contracts classified as Level 2 are based on quoted prices for similar contracts and valuation inputs other than quoted prices that are observable for these contracts. Level 3 - Valuations of assets and liabilities classified as Level 3 are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements Changes to U.S. GAAP are established by the FASB in the form of accounting standards updates (“ASUs”) to the FASB’s Accounting Standards Codification. We consider the applicability and impact of all ASUs. ASUs issued and outstanding or that became effective since January 1, 2023 through the date of these financial statements were assessed and determined not to be applicable or are expected to have minimal impact on our condensed consolidated financial position and results of operations.

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (Unaudited) - $ / shares	Mar. 31, 2023	Dec. 31, 2022
Statement Of Financial Position [Abstract]
Common stock, par value	$ 0.10	$ 0.10
Common stock, shares authorized	150,000,000	150,000,000
Common stock, shares issued	91,200,000	91,200,000
Treasury stock, common shares	15,000,000.0	14,900,000

Long-Term Debt - Working Capital Revolver Loan and Senior Secured Notes - Additional Information (Detail) - USD ($)			3 Months Ended
	Mar. 08, 2022	Oct. 14, 2021	Mar. 31, 2023	Feb. 28, 2019
Working Capital Revolver Loan [Member]
Debt Instrument [Line Items]
Maximum amount of revolving credit facility				$ 65,000,000
Letters of credit outstanding			$ 900,000
Revolving credit facility, increase (decrease), net			10,000,000
Amount available for borrowing			$ 62,300,000
Maturity date			Feb. 26, 2024
Springing Financials Covenant [Member] \| Working Capital Revolver Loan [Member]
Debt Instrument [Line Items]
Working capital revolver loan requirements			borrowers must maintain a minimum fixed charge coverage ratio of not less than 1.00 to 1.00.
Maximum revolver commitment available, percentage			10.00%
Loan requirements description			less than 10.0% of the total revolver commitments
Fixed charge coverage ratio			100.00%
6.25% Senior Secured Notes Due 2028 [Member]
Debt Instrument [Line Items]
Maturity date			Oct. 15, 2028
Debt issued - principal amount	$ 200,000,000	$ 500,000,000
Debt instrument, interest rate		6.25%
Debt instrument, maturity term		2028
Debt instrument issued price percentage	100.00%	100.00%
8.32% Secured Financing Due 2023 [Member] \| El Dorado Chemical Company [Member]
Debt Instrument [Line Items]
Maturity date			Jun. 30, 2023
Debt instrument, frequency of interest payment			Principal and interest are payable in 48 equal monthly installments with a final balloon payment of approximately $3 million due in June 2023. The final balloon payment was repaid in April 2023.
Final balloon payment			$ 3,000,000
8.75% Secured Financing Due 2025 [Member] \| El Dorado Ammonia L.L.C. [Member]
Debt Instrument [Line Items]
Maturity date			Aug. 31, 2025
Debt issued - principal amount			$ 30,000,000
Debt instrument, frequency of interest payment			principal and interest is payable in 60 equal monthly installments with a final balloon payment of approximately $5 million due in August 2025
Final balloon payment			$ 5,000,000
Letter of Credit [Member] \| Working Capital Revolver Loan [Member]
Debt Instrument [Line Items]
Maximum amount of revolving credit facility				$ 10,000,000

Net Sales - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022	Dec. 31, 2021
Revenue From Contract With Customer [Abstract]
Revenue, remaining performance obligation, expected timing of satisfaction, description	contracts have an original expected duration of one year or less, for our contracts with a duration greater than one year at contract inception, the average remaining expected duration was approximately 30 months
Average revenue remaining performance obligation expected timing of satisfaction period	30 months
Contract liabilities	$ 3,800		$ 2,000	$ 1,600
Contract with customer, liability partially offset revenue recognized	600	$ 1,400
Amount of remaining performance obligation	92,100
Accounts receivable	$ 60,251		$ 75,494	$ 86,900

Summary of Significant Accounting Policies - Additional Information (Detail)	1 Months Ended	3 Months Ended
	Jan. 31, 2023 shares	Mar. 31, 2023 Facility
Equity, Class of Treasury Stock [Line Items]
Number of facilities for manufacture and distribution of products \| Facility		4
Time Based Restricted Stock [Member]
Equity, Class of Treasury Stock [Line Items]
Vesting period of shares		3 years
Restricted stock, vesting percentage per year		33.33%
Performance Based Restricted Stock [Member] \| Minimum [Member]
Equity, Class of Treasury Stock [Line Items]
Restricted stock units, grants percentage		0.00%
Performance Based Restricted Stock [Member] \| Maximum [Member]
Equity, Class of Treasury Stock [Line Items]
Restricted stock units, grants percentage		200.00%
2016 Long Term Incentive Plan [Member]
Equity, Class of Treasury Stock [Line Items]
Awards granted vesting period		The time-based restricted stock units will vest at the end of each one-year period at the rate of one-third per year for three years. The performance-based restricted stock units will vest on the third anniversary of the grant date subject to the achievement of a market metric established by the Board as set out in the grant.
2016 Long Term Incentive Plan [Member] \| Time Based Restricted Stock [Member]
Equity, Class of Treasury Stock [Line Items]
Awards granted	171,641
2016 Long Term Incentive Plan [Member] \| Performance Based Restricted Stock [Member]
Equity, Class of Treasury Stock [Line Items]
Awards granted	171,641

Income Per Common Share (Tables)

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Computation of Basic and Diluted Net Income Per Common Share


	Three Months Ended
	March 31,
	2023		2022
	(In Thousands, Except Per Share Amounts)
Numerator:
Net income	$	15,901	$	58,766
Numerator for basic and diluted net income per common share	$	15,901	$	58,766

Denominator:
Denominator for basic net income per common share - adjusted weighted-average shares (1)		75,807		88,421
Effect of dilutive securities:
Unvested restricted stock and stock units		504		1,345
Dilutive potential common shares		504		1,345
Denominator for diluted net income per common share - adjusted weighted-average shares		76,311		89,766

Basic net income per common share	$	0.21	$	0.66

Diluted net income per common share	$	0.21	$	0.65

(1)

Excludes the weighted-average shares of unvested restricted stock that are contingently issuable.

Antidilutive Securities Excluded from Computation of Diluted Net Income Per Common Share

The following weighted-average shares of securities were not included in the computation of diluted net income per common share as their effect would have been antidilutive:


	Three Months Ended
	March 31,
	2023		2022

Restricted stock and stock units		395,301		—
Stock options		13,000		13,000
		408,301		13,000

Long-Term Debt

3 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Long-Term Debt

4. Long-Term Debt

Our long-term debt consists of the following:


	March 31,			December 31,
	2023			2022
	(In Thousands)
Working Capital Revolver Loan, with a current interest rate of 8.50% (A)	$	—		$	—
Senior Secured Notes due 2028, with an interest rate of 6.25% (B)		700,000			700,000
Secured Financing due 2023, with an interest rate of 8.32% (C)		3,292			4,161
Secured Financing due 2025, with an interest rate of 8.75% (D)		18,023			19,277
Other		1,080			1,138
Unamortized debt issuance costs		(11,780	)		(12,321	)
		710,615			712,255
Less current portion of long-term debt		8,544			9,522
Long-term debt due after one year, net	$	702,071		$	702,733

(A)

(B)

(C)

(D)

Derivatives, Hedges and Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2023

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Summary of Financial Instruments


	March 31, 2023				December 31, 2022
	Carrying		Estimated		Carrying		Estimated
	Amount		Fair Value		Amount		Fair Value
	(In Millions)
Senior Secured Notes (1)	$	700	$	618	$	700	$	637

Based on a quoted price of 88.25 at March 31, 2023 and 91.00 at December 31, 2022.

Long-Term Debt - Schedule of Revolving Credit Facility and Long-Term Debt (Parenthetical) (Detail)	Mar. 31, 2023	Dec. 31, 2022
8.50% Working Capital Revolver Loan [Member]
Debt Instrument [Line Items]
Line of credit facility, interest rate	8.50%	8.50%
6.25% Senior Secured Notes Due 2028 [Member]
Debt Instrument [Line Items]
Long-term debt, effective Interest Rate	6.25%	6.25%
8.32% Secured Financing Due 2023 [Member]
Debt Instrument [Line Items]
Long-term debt, effective Interest Rate	8.32%	8.32%
8.75% Secured Financing Due 2025 [Member]
Debt Instrument [Line Items]
Long-term debt, effective Interest Rate	8.75%	8.75%

Derivatives, Hedges and Financial Instruments - Additional Information (Detail) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2023 USD ($) MMBTU	Dec. 31, 2022 USD ($) MMBTU
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Financial instruments with fair values \| $	$ 0	$ 0
Natural Gas Purchase Commitments [Member]
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Natural gas purchase commitments volume	21,100,000
Natural Gas Purchase Commitments [Member] \| Level 2 [Member]
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Natural gas purchase commitments volume	0	0

Income Taxes - Provision for Income Taxes (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Current:
State	$ 290	$ 292
Total Current	290	292
Deferred:
Federal	4,622	11,385
State	986	(562)
Total Deferred	5,608	10,823
Provision for income taxes	$ 5,898	$ 11,115

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Commitments and Contingencies

3 Months Ended

Mar. 31, 2023

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

5. Commitments and Contingencies

Outstanding Natural Gas Purchase Commitments – At March 31, 2023, certain of our natural gas contracts qualify as normal purchases under GAAP and thus are not mark-to-market. These contracts included volume purchase commitments with fixed costs of approximately 21.1 million MMBtus of natural gas. Further, the natural gas contracts extend through December 2023 at a weighted-average cost of $3.60 per MMBtu ($75.9 million) and a weighted-average market value of $2.52 per MMBtu ($53.1 million).

Legal Matters - Following is a summary of certain legal matters involving the Company:

A. Environmental Matters

Our facilities and operations are subject to numerous federal, state and local environmental laws and to other laws regarding health and safety matters (collectively, the “Environmental and Health Laws”), many of which provide for certain performance obligations, substantial fines and criminal sanctions for violations. Certain Environmental and Health Laws impose strict liability as well as joint and several liability for costs required to remediate and restore sites where hazardous substances, hydrocarbons or solid wastes have been stored or released. We may be required to remediate contaminated properties currently or formerly owned or operated by us or facilities of third parties that received waste generated by our operations regardless of whether such contamination resulted from the conduct of others or from consequences of our own actions that were in compliance with all applicable laws at the time those actions were taken.

In addition, claims for damages to persons or property, including natural resources, may result from the environmental, health and safety effects of our operations.

There can be no assurance that we will not incur material costs or liabilities in complying with such laws or in paying fines or penalties for violation of such laws. Our insurance may not cover all environmental risks and costs or may not provide sufficient coverage if an environmental claim is made against us. The Environmental and Health Laws and related enforcement policies have in the past resulted and could in the future result, in significant compliance expenses, cleanup costs (for our sites or third-party sites where our wastes were disposed of), penalties or other liabilities relating to the handling, manufacture, use, emission, discharge or disposal of hazardous or toxic materials at or from our facilities or the use or disposal of certain of its chemical products. Further, a number of our facilities are dependent on environmental permits to operate, the loss or modification of which could have a material adverse effect on their operations and our financial condition.

Historically, significant capital expenditures have been incurred by our subsidiaries in order to comply with the Environmental and Health Laws and significant capital expenditures are expected to be incurred in the future. We will also be obligated to manage certain discharge water outlets and monitor groundwater contaminants at our facilities should we discontinue the operations of a facility.

As of March 31, 2023, our accrued liabilities for environmental matters totaled approximately $0.5 million relating primarily to the matters discussed below. Estimates of the most likely costs for our environmental matters are generally based on preliminary or completed assessment studies, preliminary results of studies, or our experience with other similar matters. It is reasonably possible that a change in the estimate of our liability could occur in the near term.

1. Discharge Water Matters

Each of our manufacturing facilities generates process wastewater, which may include cooling tower and boiler water quality control streams, contact storm water and miscellaneous spills and leaks from process equipment. The process water discharge, storm-water runoff and miscellaneous spills and leaks are governed by various permits generally issued by the respective state environmental agencies as authorized and overseen by the U.S. Environmental Protection Agency. These permits limit the type and volume of effluents that can be discharged and control the method of such discharge.

In 2017, the PCC filed a Permit Renewal Application for its Non-Hazardous Injection Well Permit at the Pryor Facility. Although the Injection Well Permit expired in 2018, PCC continues to operate the injection well pending the Oklahoma Department of Environmental Quality (“ODEQ”) action on the Permit Renewal Application. Since that time, PCC and ODEQ engaged in ongoing discussions related to the renewal of the injection well to address the wastewater stream. In 2022, ODEQ responded to the application in the form of an information request. PCC has submitted a formal response to the information request and is currently evaluating wastewater treatment alternatives.

In 2006, the El Dorado Facility entered into a Consent Administrative Order (“CAO”) that recognizes the presence of nitrate contamination in the shallow groundwater. The CAO required EDC to perform semi-annual groundwater monitoring, continue operation of a groundwater recovery system, submit a human health and ecological risk assessment and submit a remedial action plan.

The risk assessment was submitted in 2007. In 2015, the Arkansas Department of Environmental Quality (“ADEQ”) stated that El Dorado Chemical was meeting the requirements of the CAO and should continue semi-annual monitoring. A CAO was signed in 2018,

which required an Evaluation Report of the data and effectiveness of the groundwater remedy for nitrate contamination. During 2019, the Evaluation Report was submitted to the ADEQ and the ADEQ approved the report. No liability has been established as of March 31, 2023, in connection with this ADEQ matter.

2. Other Environmental Matters

In 2002, certain of our subsidiaries sold substantially all of their operating assets relating to a Kansas chemical facility (the “Hallowell Facility”) but retained ownership of the real property where the facility is located. Our subsidiary retained the obligation to be responsible for and perform the activities under, a previously executed consent order to investigate the surface and subsurface contamination at the real property, develop a corrective action strategy based on the investigation and implement such strategy. In addition, certain of our subsidiaries agreed to indemnify the buyer of such assets for these environmental matters.

As the successor to a prior owner of the Hallowell Facility, Chevron Environmental Management Company (“Chevron”) has agreed in writing, within certain limitations, to pay and has been paying one-half of the costs of the investigation and interim measures relating to this matter as approved by the Kansas Department of Health and Environment (the “KDHE”), subject to reallocation.

During this process, our subsidiary and Chevron retained an environmental consultant that prepared and performed a corrective action study work plan as to the appropriate method to remediate the Hallowell Facility. During 2020, the KDHE selected a remedy of annual monitoring and the implementation of an Environmental Use Control (“EUC”). This remedy primarily relates to long-term surface and groundwater monitoring to track the natural decline in contamination and is subject to a 5-year re-evaluation with the KDHE.

The final remedy, including the EUC, the finalization of the cost estimates and any required financial assurances remains under discussion with the KDHE. Pending the results from our discussions regarding the final remedy, we continue to accrue our allocable portion of costs primarily for the additional testing, monitoring and risk assessments that could be reasonably estimated, which amount is included in our accrued liabilities for environmental matters discussed above. The estimated amount is not discounted to its present value. As more information becomes available, our estimated accrual will be refined, as necessary.

B. Other Pending, Threatened or Settled Litigation

In 2013, an explosion and fire occurred at the West Fertilizer Co. (“West Fertilizer”) located in West, Texas, causing death, bodily injury and substantial property damage. West Fertilizer is not owned or controlled by us, but West Fertilizer was a customer of EDC and purchased AN from EDC from time to time. LSB and EDC received letters from counsel purporting to represent subrogated insurance carriers, personal injury claimants and persons who suffered property damages informing LSB and EDC that their clients are conducting investigations into the cause of the explosion and fire to determine, among other things, whether AN manufactured by EDC and supplied to West Fertilizer was stored at West Fertilizer at the time of the explosion and, if so, whether such AN may have been one of the contributing factors of the explosion. Initial lawsuits filed named West Fertilizer and another supplier of AN as defendants.

In 2014, EDC and LSB were named as defendants, together with other AN manufacturers and brokers that arranged the transport and delivery of AN to West Fertilizer, in the case styled City of West, Texas vs. CF Industries, Inc., et al., in the District Court of McLennan County, Texas. The plaintiffs allege, among other things, that LSB and EDC were negligent in the production and marketing of fertilizer products sold to West Fertilizer, resulting in death, personal injury and property damage. EDC retained a firm specializing in cause and origin investigations with particular experience with fertilizer facilities, to assist EDC in its own investigation. LSB and EDC placed its liability insurance carrier on notice and the carrier is handling the defense for LSB and EDC concerning this matter.

Our product liability insurance policies have aggregate limits of general liability totaling $100 million, with a self-insured retention of $250,000, which retention limit has been met relating to the West Fertilizer matter. In August 2015, the trial court dismissed plaintiff’s negligence claims against us and EDC based on a duty to inspect but allowed the plaintiffs to proceed on claims for design defect and failure to warn.

Subsequently, we and EDC have entered into confidential settlement agreements (with approval of our insurance carriers) with several plaintiffs that had claimed wrongful death and bodily injury and insurance companies asserting subrogation claims for damages from the explosion. While these settlements resolve the claims of a number of the claimants in this matter, we continue to be party to litigation related to the explosion. We continue to defend these lawsuits vigorously and we are unable to estimate a possible range of loss at this time if there is an adverse outcome in this matter. As of March 31, 2023, no liability reserve has been established in connection with this matter.

In 2015, we and EDA received formal written notice from Global Industrial, Inc. (“Global”) of Global’s intention to assert mechanic liens for labor, service, or materials furnished under certain subcontract agreements for the improvement of the new ammonia plant (“Ammonia Plant”) at our El Dorado Facility. Global was a subcontractor of Leidos Constructors, LLC (“Leidos”), the general contractor for EDA for the construction for the Ammonia Plant. Leidos terminated the services of Global with respect to their work performed at our El Dorado Facility.

LSB and EDA are pursuing the recovery of any damage or loss caused by Global’s work performed through their contract with Leidos at our El Dorado Facility. In March 2016, EDC and LSB were served a summons in a case styled Global Industrial, Inc. d/b/a Global Turnaround vs. Leidos Constructors, LLC et al., in the Circuit court of Union County, Arkansas, wherein Global sought damages under breach of contract and other claims. At the time of the summons, our accounts payable included invoices totaling approximately $3.5 million related to the claims asserted by Global, but such invoices were not approved by Leidos for payment. We have requested indemnification from Leidos under the terms of our contracts, which they have denied. As a result, we are seeking reimbursement of legal expenses from Leidos under our contracts. We also seek damages from Leidos for their wrongdoing during the expansion, including breach of contract, fraud, professional negligence and gross negligence.

During 2018, the court bifurcated the case into: (1) Global’s claims against Leidos and LSB and (2) the cross-claims between Leidos and LSB. Part (1) of the case was tried in the court. In March 2020, the court rendered an interim judgment and issued its final judgment in April 2020. In summary, the judgment awarded Global (i) approximately $7.4 million (including the $3.5 million discussed above) for labor, service and materials furnished relating to the Ammonia Plant, (ii) approximately $1.3 million for prejudgment interest and (iii) a claim of lien on certain property and the foreclosure of the lien to satisfy these obligations. In addition, post-judgment interest will accrue at the annual rate of 4.25% until paid. This judgement was accrued for at the time of the ruling, and we continue to accrue post-judgement interest.

We have filed a notice of intent to appeal and the court entered a stay of the judgment pending appeal. LSB intends to vigorously prosecute its claims against Leidos and vigorously contest the cross-claims in Part (2) of the matter. Due to the impact from the COVID-19 pandemic, the trial date for Part (2) of the matter has been delayed and we are awaiting a new trial date.

No liability was established at March 31, 2023 or December 31, 2022, in connection with the cross-claims in Part (2) of the matter, except for certain invoices held in accounts payable. We are also involved in various other claims and legal actions (including matters involving gain contingencies). It is possible that the actual future development of claims could be different from our estimates but, after consultation with legal counsel, we believe that changes in our estimates will not have a material effect on our business, financial condition, results of operations or cash flows.

Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Operating Loss Carryforwards [Line Items]
Provision for income taxes	$ 5,898	$ 11,115
Percentage of provision on pre-tax income	27.10%	15.90%
State and Local Jurisdiction [Member]
Operating Loss Carryforwards [Line Items]
Valuation allowance reduction, Change	$ 1,700

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Income Per Common Share

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Income Per Common Share

2. Income Per Common Share


	Three Months Ended
	March 31,
	2023		2022
	(In Thousands, Except Per Share Amounts)
Numerator:
Net income	$	15,901	$	58,766
Numerator for basic and diluted net income per common share	$	15,901	$	58,766

Denominator:
Denominator for basic net income per common share - adjusted weighted-average shares (1)		75,807		88,421
Effect of dilutive securities:
Unvested restricted stock and stock units		504		1,345
Dilutive potential common shares		504		1,345
Denominator for diluted net income per common share - adjusted weighted-average shares		76,311		89,766

Basic net income per common share	$	0.21	$	0.66

Diluted net income per common share	$	0.21	$	0.65

(1)

Excludes the weighted-average shares of unvested restricted stock that are contingently issuable.

The following weighted-average shares of securities were not included in the computation of diluted net income per common share as their effect would have been antidilutive:


	Three Months Ended
	March 31,
	2023		2022

Restricted stock and stock units		395,301		—
Stock options		13,000		13,000
		408,301		13,000

Income Per Common Share - Computation of Basic and Diluted Net Income Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Numerator:
Net income	$ 15,901	$ 58,766
Numerator for basic net income per common share	15,901	58,766
Numerator for diluted net income per common share	$ 15,901	$ 58,766
Denominator:
Denominator for basic net income per common share - adjusted weighted-average shares	75,807	88,421
Effect of dilutive securities:
Unvested restricted stock and stock units	504	1,345
Dilutive potential common shares	504	1,345
Denominator for diluted net income per common share - adjusted weighted-average shares	76,311	89,766
Basic net income per common share	$ 0.21	$ 0.66
Diluted net income per common share	$ 0.21	$ 0.65

Current and Noncurrent Accrued and Other Liabilities (Tables)

3 Months Ended

Mar. 31, 2023

Other Liabilities Disclosure [Abstract]

Summary of Current and Noncurrent Accrued and Other Liabilities


	March 31,		December 31,
	2023		2022
	(In Thousands)
Accrued interest	$	22,212	$	11,196
Current portion of operating lease liabilities		7,869		7,259
Accrued payroll and benefits		4,468		12,440
Other		9,590		8,097
		44,139		38,992
Less noncurrent portion		522		522
Current portion of accrued and other liabilities	$	43,617	$	38,470