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Lithium miner SQM swings to $870 million loss on sinking prices, tax ruling

Chilean mining group SQM, the world's secondlargest lithium manufacturer, swung into an $870. million net loss in the very first quarter, it stated on Thursday, hurt. by a capture on prices due to oversupply and the $1.1 billion. effect of a tax ruling.

This brought a loss of $3.04 per share, well listed below the $0.74. earnings anticipated by experts surveyed by LSEG. Incomes more than. cut in half to $1.09 billion over January to March, below analysts'. $ 1.13 billion forecast.

A year previously, the business had published revenue of near to. $ 750 million.

SQM CEO Ricardo Ramos said that in spite of growth in sales. volumes, the quarter had been struck by a more than 75% drop in. typical sales prices for lithium to $12,600 per ton.

Information from Criteria Mineral Intelligence recommends global. rates have actually fallen by more than 80% due to weaker need for. electric cars. The white metal is a key component in. rechargeable batteries.

The outcomes also reflect a $1.1 billion accounting hit that. SQM stated in April would result from a long-standing tax conflict. The business stated the ruling is still based on appeal.

Albemarle, the world's biggest lithium producer, saw. costs halve its earnings and push revenues listed below estimates -. though these stayed in positive territory. The business alerted. early this month it might cut spending if costs stay low.

SQM, nevertheless, remained upbeat as needed.

RAISED GUIDANCE

We believe that the strong need development in the lithium. market seen since the beginning of the year might continue for. the rest of the year, with total lithium demand surpassing. 1.1 million metric tons during 2024, Ramos said.

While SQM's quarterly lithium earnings fell 67% from a year. earlier, its lithium sales volumes grew 34%.

The company anticipated volumes might climb up some 18% to reach. 200,000 metric lots this year, compared to 170,000 tons in 2023. This is up from the 5% to 10% increase it had previously. projection, when it warned of a supply excess.

SQM plans to continue with its development strategies in Chile and. abroad, Ramos said.

The business has been expanding its lithium carbonate. capability in Chile. It anticipates to produce 210,000 loads this year. and 240,000 tons by 2025, by when it said it needs to be totaling. 305,000 lots of lithium carbonate equivalent.

This includes output from a Chinese plant set to convert. lithium sulfate from Chile's Atacama salt flats into. battery-grade lithium hydroxide, and the acquisition of a 50/50. joint venture with Hancock Prospecting in Australia.

SQM added it is finalizing details of an arrangement with. copper miner Codelco that is anticipated to provide the. state-run business a majority share in a new partnership while. extending SQM's lease in the Atacama salt flats through 2060.

The 2 firms are anticipated to announce a completed deal on. May 31.