SANTIAGO, Chile, May 23, 2019 /PRNewswire/ -- Sociedad Química y
Minera de Chile S.A. (SQM) (NYSE: SQM; Santiago Stock Exchange:
SQM-B, SQM-A) reported earnings today for the three
months ended March 31, 2019 of
US$80.5 million (US$0.31 per share), a decrease from US$113.8 million (US$0.43 per share) reported for the three months
ended March 31, 2018. Gross
profit reached US$145.5 million
(29.9% of revenues) for the three months ended March 31, 2019, compared to US$192.7 million (37.1% of revenues) recorded for
the three months ended March 31,
2018. Revenues totaled US$504.2 million for the three months ended
March 31, 2019, representing a slight
decrease of 2.8% compared to US$518.7
reported for the three months ended March
31, 2018.
SQM's Chief Executive Officer, Ricardo
Ramos, stated: "We reported earnings for the three months
ended March 31, 2019 of US$80.5 million. In line with our expectations,
iodine and potassium chloride prices increased significantly
compared to the same period last year, and sales volumes grew in
the iodine, specialty plant nutrition and lithium business lines.
In fact, we reported the highest quarterly iodine revenue since
2013. Other important factors that impacted our results in the
first quarter 2019 were lower margins in the lithium business line.
These margins were impacted by lower average prices and higher
costs related to the new lease payment structure with Corfo, which
became effective on April 10, 2018,
and were therefore not a part of the first quarter 2018 costs.
Additionally, we sold lower sales volumes in industrial chemicals
during the first quarter 2019 when compared to 2018; we expect
similar sales volumes of solar salts this year as we sold last
year, approximately 45,000 -50,000 metric tons During the remainder
of 2019, our expectations related to sales volumes across all of
our business lines have not changed."
He continued by saying, "As expected, during the first quarter,
the lithium market saw price pressure as new supply entered the
market. Consequently, our average prices fell approximately 8% in
comparison to the fourth quarter last year, and we reported average
prices of approximately US$14,600/metric tons in this business line. Our
sales volumes were higher than sales volumes reported in the first
quarter 2019, and we continue to expect to sell between
45,000-50,000 metric tons of lithium carbonate equivalent this
year."
Mr. Ramos continued, "Lithium carbonate and lithium hydroxide
demand is expected to continue to grow at double-digit rates in the
future; accordingly, significantly more supply of both products
will be needed. We believe the lithium demand could grow
approximately 17% in 2019 when compared to 2018, reaching at least
315,000 metric tons. The evolving EV battery technology in the
lithium market will require us to be flexible, and we believe this
operational flexibility is essential, and is the key component of
our strategy. We are currently working on our lithium carbonate
expansion to produce 120,000 metric tons per year. We believe this
expansion will be completed during the second half of 2021, with a
capex of approximately US$280
million. We are also expanding our lithium hydroxide
capacity in Chile to 29,500 metric
tons in 2021; the expected capex for this project is US$100 million. Finally, Wesfarmers formally
informed that it is expecting to acquire Kidman Resources, our
partner in the Mt. Holland lithium
project; we believe their experience and capabilities related to
chemical processing, and their significant local infrastructure in
Australia will be an important
asset in the development of the project."
He closed by saying, "I would like to highlight that during the
first part of 2019, board elections were held. We look forward to
working with the new Board members, and believe that they will
bring good insights and expertise to the Company at the Board
level."
For more information: Please visit www.sqm.com
About SQM
SQM´s business strategy is to be a global company, with people
committed to excellence, dedicated to the extraction of minerals
and selectively integrated in the production and sale of products
for the industries essential for human development (e.g. food,
health, technology). This strategy was built on the following five
principles:
- ensure availability of key resources required to support
current goals and medium and long-term growth of the business;
- consolidate a culture of lean operations (M1 excellence)
through the entire organization, including operations, sales and
support areas;
- significantly increase nitrate sales in all its applications
and ensure consistency with iodine commercial strategy;
- maximize the margins of each business line through appropriate
pricing strategy;
- successfully develop and implement all lithium expansion
projects of the Company, acquire more lithium and potassium assets
to generate a competitive portfolio.
These principles are based on the following key concepts:
- strengthen the organizational structure to support the
development of the Company's strategic plan, focusing on the
development of critical capabilities and the application of the
corporate values of Excellence, Integrity and Safety;
- develop a robust risk control and mitigation process to
actively manage business risk;
- improve our stakeholder management to establish links with the
community and communicate to Chile
and worldwide our contribution to industries essential for human
development.
For further information, contact:
Gerardo Illanes 56-2-24252022 /
gerardo.illanes@sqm.com
Kelly O'Brien 56-2-24252074 /
kelly.obrien@sqm.com
Irina Axenova 56-2-24252280 /
irina.axenova@sqm.com
For media inquiries, contact:
Pablo Pisani /
pablo.pisani@sqm.com
Tamara Rebolledo /
tamara.rebolledo@sqm.com (Northern Region)
Cautionary Note Regarding Forward-Looking Statements
This news release contains "forward-looking statements" within
the meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements can be identified by words such as: "anticipate,"
"plan," "believe," "estimate," "expect," "strategy," "should,"
"will" and similar references to future periods. Examples of
forward-looking statements include, among others, statements we
make concerning the Company's business outlook, future economic
performance, anticipated profitability, revenues, expenses, or
other financial items, anticipated cost synergies and product or
service line growth.
Forward-looking statements are neither historical facts nor
assurances of future performance. Instead, they are estimates that
reflect the best judgment of SQM management based on currently
available information. Because forward-looking statements
relate to the future, they involve a number of risks, uncertainties
and other factors that are outside of our control and could cause
actual results to differ materially from those stated in such
statements. Therefore, you should not rely on any of these
forward-looking statements. Readers are referred to the
documents filed by SQM with the United States Securities and
Exchange Commission, specifically the most recent annual report on
Form 20-F, which identifies important risk factors that could cause
actual results to differ from those contained in the
forward-looking statements. All forward-looking statements are
based on information available to SQM on the date hereof and SQM
assumes no obligation to update such statements, whether as a
result of new information, future developments or otherwise, except
as required by law.
View original
content:http://www.prnewswire.com/news-releases/sqm-reports-earnings-for-the-three-months-ended-march-31-2019-300855698.html
SOURCE SQM