SQM Reports Earnings For The Third Quarter Of 2021

SANTIAGO, Chile, Nov. 17, 2021 /PRNewswire/ -- 

Highlights

• SQM reported net income for the nine months ended September 30, 2021 of US$263.9 million compared to US$97.5 million for the same period the year before. Earnings per share totaled US$0.92 for the first nine months of 2021, higher than the US$0.37 reported for the first nine months of 2020.
• Revenues for the nine months ended September 30, 2021 were US$1,778.0 million.
• Higher sales volumes and average prices in almost all of our business lines during the first nine months of 2021 when compared to the same period last year.
• SQM recently qualified for both the DJSI Chile Index and DJSI MILA Pacific Alliance Index.

SQM will hold a conference call to discuss these results on Thursday, November 18, at 10:00am ET (12:00pmChile time). 

Sociedad Química y Minera de Chile S.A. (SQM) (NYSE: SQM; Santiago Stock Exchange: SQM-B, SQM-A) reported today earnings for the nine months ended September 30, 2021 of US$263.9 million (US$0.92⁽²⁾ per ADR), an increase from US$97.5 million (US$0.37⁽²⁾ per ADR) for the nine months ended September 30, 2020⁽³⁾.

Gross profit⁽⁴⁾ reached US$547.3 million (30.8% of revenues) for the nine months ended September 30, 2021, higher than US$350.4 million (26.9% of revenues) recorded for the nine months ended September 30, 2020. Revenues totaled US$1,778.0 million for the nine months ended September 30, 2021, representing an increase of 36.4% compared to US$1,303.4 million reported for the nine months ended September 30, 2020.

The Company also announced earnings for the third quarter of 2021, reporting net income of US$106.1 million (US$0.37⁽²⁾ per ADR) compared to US$1.7 million (US$0.01⁽²⁾ per ADR) for the third quarter of 2020. Gross profit⁽⁴⁾ for the third quarter of 2021 reached US$224.8 million, higher than the US$114.8 million recorded for the third quarter of 2020. Revenues totaled US$661.6 million, an increase of approximately 46.1% compared to the third quarter of 2020, when revenues amounted to US$452.9 million.  

SQM's Chief Executive Officer, Ricardo Ramos, stated: "We reported a significantly higher net income for the nine months ended September 30, 2021 when compared to the similar period of 2020. These results were primary driven by much higher sales volumes in lithium, iodine, specialty plant nutrition and potassium business lines as well as higher realized prices in all our business lines".

He continued by saying, "The expansion of our lithium operations is yielding positive results, letting us increase our sales volumes more than 80% when compared to last year. We are already producing at rate higher than 120,000 metric tons per year, while we continue working to reach 180,000 metric tons capacity next year. We are confident that our sales volumes could reach close to 100,000 metric tons this year, on a market that we estimate will grow close to 50%. This market growth is putting pressure on prices, as a result, we forecast average prices to be close to 50% higher in the fourth quarter this year when compared to prices reported in the third quarter 2021".

"In the iodine market, the rapid post-Covid recovery is being reflected in a 25% increase in our sales volumes in the first three quarters of 2021 compared to the same period last year. This strong demand growth should have a positive impact on prices going forward since supply is not keeping up."

The CEO continued by saying, "Given the existing shortage of potash and potassium-based fertilizers, we have seen a significant increase of global potassium prices, letting us report an over 65% increase of our average price in potassium business line during the third quarter of 2021 when compared to the same period last year. This positive trend should continue during the fourth quarter, with prices of potassium-based fertilizers growing at a rate higher than earlier anticipated".

The CEO closed by saying, "The positive trends we are seeing in each of the markets in which we participate, along with the expiration of the legacy lithium contracts, are leading us to reach record-level results in the fourth quarter of this year".

Sustainable Development

We continue with the implementation of our Sustainable development plan, focusing on reducing our emissions, water and brine usage, strengthen our relationships with communities and contributing to the regional development. For the second year, we were qualified for DJSI Chile Index and DJSI MILA Pacific Alliance Index.

During the third quarter we submitted our first disclosure report under Climate Disclosure Project (CDP) Climate change guidance and completed self-evaluation process under The Initiative for Responsible Mining Assurance (IRMA). We are also extremely pleased with the successful placement of our first green bond of US$700 million which proceeds will be used to finance lithium capacity expansion projects that contribute to the low-carbon transition through clean transportation and energy storage solutions.

Recently we joined the Race to Zero initiative which focuses on the immediate actions to reduce global emissions by 2030. Race to Zero is an initiative from the United Nations Framework Convention on Climate Change (UNFCCC). It is an external validation of SQM's sustainable development plan to become carbon neutral in lithium, iodine, and potassium chloride products. Race to Zero is based on 4 meta-criteria: Pledge, Plan, Proceed and Publish. This implies the use of science-based targets and ties in with our ongoing work with the CDP to limit global warming to 1.5°C. 

As part of Race to Zero initiative and our aim to reduce our logistics carbon footprint, we have introduced Chile´s first high tonnage electric truck which will be operating on the route between Coya Sur and Tocopilla. If this project is successful, we expect to continue replacing diesel power trucks by electric ones in our operations.

About SQM

SQM is a global company that is listed on the New York Stock Exchange and the Santiago Stock Exchange (NYSE: SQM; Santiago Stock Exchange: SQM-B, SQM-A). SQM develops and produces diverse products for several industries essential for human progress, such as health, nutrition, renewable energy and technology through innovation and technological development. We aim to maintain our leading world position in the lithium, potassium nitrate, iodine and thermo-solar salts markets.

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: 

Maria Ignacia Lopez / ignacia.lopez@sqm.com
Pablo Pisani / pablo.pisani@sqm.com

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 capital expenditures, financing sources, Sustainable Development Plan, business and demand outlook, future economic performance, anticipated sales volumes, 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, including our ability to successfully implement the Sustainable Development Plan. 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, including the most recent annual report on Form 20-F, which identifies other 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.

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SOURCE Sociedad Quimica y Minera de Chile, S.A. (SQM)