SANTIAGO, Chile, Feb. 28, 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 twelve months ended December 31, 2018 of US$439.8 million (US$1.67 per ADR), an increase from US$427.7 million (US$1.63 per ADR) reported for the twelve months ended December 31, 2017. Gross profit reached US$782.3 million (34.5% of revenues) for the twelve months ended December 31, 2018, higher than US$762.5 million (35.3% of revenues) recorded for the twelve months ended December 31, 2017. Revenues totaled US$2,265.8 million for the twelve months ended December 31, 2018, representing an increase of 5.0% compared to US$2,157.3 million reported for the twelve months ended December 31, 2017.
The Company also announced earnings for the fourth quarter of 2018, reporting net income of US$108.6 million (US$0.41 per ADR) compared to US$110.5 million (US$0.42 per ADR) for the fourth quarter of 2017. Gross profit for the fourth quarter 2018 reached US$201.5 million; lower than the US$216.1 million recorded for the fourth quarter 2017. Revenues for the fourth quarter 2018 totaled US$565.2 million, a decrease of approximately 1.6% compared to the fourth quarter 2017, when revenues amounted to US$574.8 million.
SQM's Chief Executive Officer, Ricardo Ramos, stated: "During 2018, our strong results were led by higher average prices in the lithium business line, higher specialty plant nutrient sales volumes, and higher average prices and sales volumes in the iodine business line. These factors offset the impact of the lower sales volumes of potassium chloride. The lithium market continued to grow at unprecedented levels. We believe that demand growth surpassed 25% in 2018, led by growth in the electric vehicle market. We believe electric vehicle penetration levels reached 2% in 2018, and we expect these levels to increase significantly in the future. As a result of strong demand growth, average prices in 2018 were significantly higher than prices reported in 2017; as anticipated, prices in the fourth quarter also remained strong. We believe lithium demand could grow at least 20% in 2019, and we will invest accordingly in this growing market."
He continued by saying, "In recent weeks, the north of Chile, including areas near our operations, was impacted by heavy rains. Our first priority was the safety of our employees, and we are pleased to announce that no injuries were reported. Following this climactic event, we have been very active in helping the neighboring communities which were impacted, and suffered during the rain. Finally, while some of our facilities were not operating at 100% for a short period of time, we do not believe that there will be a lasting effect on our sales volumes or revenues in coming quarters. We will continue assessing any potential impacts of these rains, and will inform the market if anything relevant materializes."
For more information: Please visit www.sqm.com
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.
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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.
SOURCE Sociedad Quimica y Minera de Chile, S.A. (SQM)