SANTIAGO, Chile, March 5, 2014 /PRNewswire/ -- Sociedad Quimica y Minera de Chile S.A. ("SQM") (NYSE: SQM; Santiago Stock Exchange: SQM-B, SQM-A) reported today earnings for the twelve months ended December 31, 2013 of US$467.1 million (US$1.77 per ADR), a decrease from US$649.2 million (US$2.47 per ADR) for the twelve months ended December 31, 2012. Gross Margin reached US$721.5 million (32.7% of revenues) for the twelve months ended December 31, 2013; a decrease compared to US$1,028.6 million (42.3% of revenues) for the twelve months ended December 31, 2012. Revenues totaled US$2,203.1 million for the twelve months ended December 31, 2013, representing a decrease compared to US$2,429.2 million reported for the twelve months ended December 31, 2012.
The Company also announced earnings for the fourth quarter of 2013, reporting net income of US$69.0 million (US$0.26 per ADR) compared to US$141.8 million (US$0.54 per ADR) for the fourth quarter of 2012. Gross Margin for the fourth quarter of 2013 reached US$146.3 million, a decrease compared to US$234.3 million for the fourth quarter of 2012. Revenues totaled US$492.2 million, a decrease compared to US$601.0 million for the fourth quarter of 2012.
Patricio Contesse, SQM's Chief Executive Officer, stated, "SQM faced important commercial challenges during 2013; pricing was more difficult in the potassium chloride market when compared to 2012. Increased volumes in the potassium chloride business line helped us to partially offset these lower prices, but our margins were impacted. As we have stated before, we believe that world market demand is the most important indicator when assessing pricing and the overall future of the potash market. We remain confident that total potash demand levels in 2014 will surpass levels recorded during 2013, this could lead to a positive change in the pricing situation we have seen in recent months."
Mr. Contesse continued, "As anticipated, and following the positive trends in recent years, we saw market demand growth in both lithium and iodine during 2013. However, new supply in excess of market growth, was added by existing competitors; this ultimately had a negative impact on our sales volumes in both business lines during 2013 when compared to 2012. As we stated in an announcement in December, during the end of 2013 iodine prices decreased in accordance with market conditions. Throughout 2014, we will continue to face challenges considering the uncertainty related to the production and sales volumes of our competitors in the iodine market, but we remain confident in our long-term position in the market as the largest producer with significant cost advantages."
"During 2013, we worked diligently on a major expansion plan in the Salar de Atacama to increase our effective capacity of potassium chloride by the end of 2014. In the coming months, we look forward to reaping the benefits of these expansion efforts. We will continue to work on our cost-saving efforts that began during 2013."
The CEO closed by saying "We are well-positioned to move quickly to meet any changes in market demand and market dynamics in all of the main businesses in which we sell. Rest assured, we will act on what we believe to be in the best interest for the long-term of the Company, and remain focused on maximizing margins and shareholder value. Any strategic decisions will reflect these goals."
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SQM is an integrated producer and distributor of specialty plant nutrients, iodine, lithium, potassium-related fertilizers and industrial chemicals. Its products are based on the development of high quality natural resources that allow the Company to be a leader in costs, supported by a specialized international network with sales in over 110 countries. SQM's development strategy aims to maintain and strengthen the Company's position in each of its businesses.
The leadership strategy is based on the Company's competitive advantages and on the sustainable growth of the different markets in which it participates. SQM's main competitive advantages in its different businesses include:
- Low production costs based on vast and high quality natural resources;
- Know-how and its own technological developments in its various production processes;
- Logistics infrastructure and high production levels that allow SQM to have low distribution costs;
- High market share in all its core products;
- International sales network with offices in 20 countries and sales in over 110 countries;
- Synergies from the production of multiple products that are obtained from the same two natural resources;
- Continuous new product development according to the specific needs of its different customers;
- Conservative and solid financial position.
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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.