I prefer for the company to maintain its dividend at current levels, while paying off (or refinancing at lower rates) the $250 million in debt it carries with a nominal interest rate of around ~12%. The debt financing (approx. $320 million) at ~7% should not be paid off quickly. The company is already moving (see Oct. 19 press release) to effectively refinance half of the "expensive" debt.
After paying off the more expensive debt, the company should commit to growing its dividend at around ~10% per year and to spending most excess cash on share repurchases. The company is not primed for growth, and acquisition opportunities are limited.
High debt is characteristic of leveraged buyouts. CMP has been retiring it most expensive debt on an accelerated schedule, so apparently management agrees that they should pay down debt.
Usually, I see people make this statement followed by "instead of paying such a large dividend." This is a high, positive cash flow industry, and what to do with that cash is a real problem. You can pay a dividend, rewarding the people who supported your LBO in the first place. You can pay down debt, asking those people to postpone their reward for another few years. You can buy competitors-or really the salt divisions of larger, more diverse competitors. Personally, I like a company to heap its spare cash upon me. I don't think this staid, commodity sector is ready for either consolidation or massive growth.
I believe debt should be minimum or none at all. Have lots of cash on hand to withstand downturns. Long term business plan and then expansion if cash exceeds certain amount or opportunity available during bad times to buyout other companies when cash is available. Stock price will go up higher and higher. This would be the kind of company I would invest in for the long term. One investment might be good enough but it's hard to find such companies.