SQM Reports Earnings of $796.1mn in 1Q:22

(SQM, 19.May.2022) — Sociedad Química y Minera de Chile S.A. (SQM) (NYSE: SQM; Santiago Stock Exchange: SQM-B, SQM-A) reported earnings for the three months ended 31 March 2022 of US$796.1 million (US$2.79 per share), an increase from US$68mn (US$0.26 per share) reported for the three months ended 31 March 2021. Gross profit reached US$1,164.7mn (57.7% of revenues) for the three months ended 31 March 2022, compared to US$136.6mn (25.9% of revenues) recorded for the three months ended 31 March 2021. Revenues totaled US$2,019.8mn for the three months ended 31 March 2022, an increase compared to the US$528.5mn reported for the three months ended 31 March 2021.

Highlights

  • SQM reported net income for the three months ended 31 March 2022 of US$796.1mn, compared to US$68mn in same period of 2021.
  • Revenues for the three months ended 31 March 2022, were US$2,019.8mn.
  • Earnings per share totaled US$2.79 for the three months ended 31 March 2022.
  • Our first quarter results include payments related to the agreement with Corfo and tax provisions that totaled approximately US$800mn.
  • Adjusted EBITDA margin for the first three months of 2022 reached 58.7%.

SQM’s Chief Executive Officer, Ricardo Ramos, stated: “Our first quarter results reflect several positive circumstances; first, the impact of higher prices in all our business lines, where significant increases in lithium prices stand out, and second, the successful long-term, operational and commercial strategy.”

Related to our operations in the Salar de Atacama, it is important to remember that SQM began this project by acquiring the participation from producers from Chile and the United States in 1993. Before our acquisition, there had been seven years of investments and studies by these companies. We assumed the risk, developed, invested and executed the project. It has not been an easy task; the natural resource was not well known, and our project has had its ups and downs. Mining activities require long periods of development, dialogue and collaboration with the neighboring communities, relevant investments from shareholders and, above all, a strong team to innovate and develop technologies to operate the natural resource.”

Today we can proudly report that we are a leader in the lithium industry. We have almost tripled our production levels in three years while we have significantly decreased the extraction of brines. We are the most integrated lithium producer in its country of origin, delivering high-quality products that can be used directly in the production of high-end battery components.

Our first quarter results include payments related to the agreement with Corfo and tax provisions that totaled approximately US$800 million. In total, the amount is similar to the earnings reported by all of our business during the first quarter of this year.

SQM’s lithium business is a very good example of a successful public-private partnership. No other operation delivers more resources proportionally to Chilean coffers; approximately 60% of the operating margin from lithium is dedicated to payments to Corfo and taxes.”

Mr. Ramos finished by saying: “We continue to permanently analyze new ideas and study new projects in all our businesses. We will review our investment plan in the coming months, and we should update our projections following that review. It is very likely that we will increase the resources oriented to the development of business in Chile and abroad.”

Sustainable Development

In April 2022 we published our audited 2021 Sustainability Report. For the twelfth consecutive year, the information was presented under the GRI standards (Global Standard Initiative) and for first time, under SASB (Sustainability Accounting Standards Board) standards. We would like to highlight that SQM’s workforce is made up of approximately 19% women, in an industry where the average in Chile is 13%. Furthermore, 30% of the executive positions at SQM are filled by women. We are proud that in the Northern regions of Chile, our we employment base is over 82% local.

We continue to keep sustainability at the core of the company and during 2021 we were able to reduce our carbon emissions 28% per ton when compared to 2020. Specific to the lithium production, we reduced direct water consumption for lithium carbonate approximately 27% in 2021 when compared to 2020.

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