智利化工礦業 (SQM) 2012 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the third-quarter 2012 SQM earnings conference call. My name is Tawanda and I will be your coordinator for today. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the presentation over to Mr. Mark Fones, VP of Finance and IR. Please proceed, sir.

Good afternoon, everyone, and welcome to SQM's third-quarter 2012 earnings conference call. For your information, this conference call will be recorded and is being webcast live. You may access the webcast later on -- at our website www.SQM.com.

Joining me today as speakers are Patricio Contesse, Chief Executive Officer; Patricio de Solminihac, Executive Vice President and Chief Operating Officer; and Ricardo Ramos, CFO.

Before we begin, let me remind you that statements in this conference call concerning the Company's business and outlook; future economic performances; anticipated profitability, revenues, expenses or other financial items; anticipated cost synergies and [products] of service line growth, together with other statements that are not historical facts, are forward-looking statements, as that term is defined under federal securities laws.

Any forward-looking statements or estimates reflecting the best judgment of SQM based on currently available information, and involve a number of risks, uncertainties and other factors that could have caused actual results to differ materially from those stated in such statements. Risks, uncertainties and factors that could affect the accuracy of such forward-looking statements are identified in a public filing made with the Securities and Exchange Commission. And forward-looking statements should be considered in light of those factors.

I now leave you with our CEO, Patricio Contesse, for brief comments before we move to Q&A.

Good afternoon, and thank you for joining us. We posted strong earnings during the third quarter of 2012, and we are pleased to be able to discuss them with you this morning. Our results were led by increased average price in iodine and by increased sales in volumes of potassium, lithium and Industrial Chemicals business lines when compared to last year. In our iodine business line, prices remain high during the third quarter of 2012, and demand continues to grow at healthy rates, led primarily by (technical difficulty) and pharmaceutical application.

In the lithium market, prices have increased over 10% in the first nine months of 2012 when compared to the first nine months of 2011. In the lithium market, demand continued to grow, led by batteries. And as a result, we should see our sales volume for lithium and derivatives increase over 10% compared to the sales of volumes in 2011.

As expected, sales of solar salts increased significantly, and our sales revenue during the third quarter increased 80% year-on-year. However, we will likely see significant volume decrease in solar salts during 2013, as projects are delayed. This volume decrease should be temporary, and we remain confident in the long-term potential of the solar salts business.

In our (technical difficulty) market, revenues and volumes in our production business line were up compared to the third quarter of last year. However, with the global products market facing a difficult environment, pricing has been really unstable in the past weeks and will be difficult to predict the near future. In our SPN business line, SQM volumes were impacted by a return of a relevant customer to the market, and our revenues were down compared to the first nine months of 2011.

Capital expenditures plans are moving forward and we still expect to invest about $500 million during 2012. We'll continue to monitor the financial markets and developments in Europe very closely, in which the slowdown is starting to show some effect in volumes across all our business lines. However, our unique commercial flexibility and operational synergies will allow us to continue maintaining our competitive advantage, and to react and benefit to changing market mix.

Thank you very much.

Thank you, Patricio. Operator, we may go now to Q&A session.

(Operator Instructions).

Okay, thank you all very much for joining us today. And we hope to have you with us in the next conference call. So good bye, everyone.

Ladies and gentlemen, this concludes the presentation. You may now disconnect, and have a great day.