SQM’s second-quarter web revenue got here in at $213.6 million, or 75 cents per share, falling wanting analysts’ prediction of $296.7 million, or 95 cents per share, in response to LSEG knowledge.
Income for the quarter reached $1.3 billion, which was according to analysts’ expectations, based mostly on LSEG Information and Analytics predictions.
SQM, which extracts many of the lithium it produces from brines within the Atacama salt flat of northern Chile, mentioned record-high gross sales volumes couldn’t offset depressed costs for the battery metallic.
“The robust gross sales volumes progress within the lithium enterprise within the second quarter was offset by considerably decrease common realized lithium costs, on account of decrease market costs when in comparison with the identical interval final 12 months,” chief govt officer, Ricardo Ramos, mentioned within the assertion.
“We see this pricing development persevering with within the second half of this 12 months, with present lithium value indices in China practically 20% decrease than the common lithium value indices within the second quarter of 2024,” Ramos famous.
Past Chile
SQM has been making worldwide investments into laborious rock lithium mining, together with into Australia’s Azure Minerals (ASX: AZS), in a push to broaden its geographic focus.
As a part of this technique, the Santiago-based miner highlighted the launch of SQM Worldwide Lithium, a brand new division aimed toward increasing the corporate’s operations past Chile.
“This initiative displays SQM’s robust confidence within the long-term progress potential of the worldwide lithium trade,” Ramos mentioned.
The manager famous that SQM plans to make the most of its expertise in exploration, mission growth, mergers and acquisitions to construct a sturdy portfolio of lithium property in partnership with different miners.
The aim is for SQM Worldwide Lithium to spice up the corporate’s total manufacturing by at the least 100,000 tonnes of lithium carbonate equal (LCE) a 12 months by the top of the last decade.
In 2024, SQM anticipates a complete capital expenditure of practically $1.6 billion. The funding contains key acquisitions already in place, such because the $350 million Andover lithium and nickel-copper-cobalt mission in Australia, secured by means of the corporate’s three way partnership with Azure. It additionally plans to allocate round $140 million for the acquisition of the Dixin plant in China, the place it appears to be like to provide as much as 30,000 tonnes of lithium hydroxide a 12 months.
The remaining funds will assist the growth of each lithium carbonate and hydroxide manufacturing capacities in Chile, in addition to the expansion of the corporate’s nitrates and iodine operations. Upkeep bills are anticipated to account for round $150 million of the entire capex, SQM mentioned.
Chile is the world’s second-largest lithium producer after Australia, due to output from SQM and rival US-based Albemarle (NYSE: ALB).
The copper-rich nation just lately opened up new lithium mining areas to non-public corporations and it’s testing direct lithium extraction. With this course of, brine will be re-injected again into salt flats, lowering the environmental affect and accelerating manufacturing.
In line with the nation’s copper fee Cochilco, Chile is predicted to provide about 275,000 tonnes of LCE this 12 months and 285,000 tonnes in 2025.