SQM quarterly profit rises as lithium prices rebound
Chilean lithium producer SQM on Tuesday reported a rise in third-quarter net profit, helped by an improved pricing environment that lifted average lithium prices for the first time in two years.
The world's second-largest lithium producer said net income for the quarter ended September 30 was $178.4-million, or $0.62 a share, compared with $131.4-million a year earlier.
Revenue for the quarter rose 8.9% to $1.17-billion, from $1.08-billion in the same period last year.
SQM said revenues for lithium and derivatives increased 21.4% to $603.7-million in the quarter, driven by stronger-than-expected demand.
"We expect this upward trend to continue through the fourth quarter, supported by strong demand for lithium, not only from electric vehicles (EV) but also from energy storage systems (ESS)", SQM's CEO Ricardo Ramos said.
SQM, one of only two companies producing lithium in Chile, also makes fertilizers and industrial chemicals.
Lithium prices have cooled from record highs in 2022 as supply growth outpaced demand, pressuring margins for global producers including SQM and rivals such as US-based Albemarle.
Still, demand for the battery metal is expected to rise in the coming years in line with the growth of electric vehicles and battery storage.
SQM said it is moving closer to finalising its partnership with state miner Codelco to ramp up lithium extraction in the Atacama salt flat, with only approval from Chile’s comptroller still pending after China's markets regulator cleared the deal last month.
Codelco expects the sign-off by year-end, a company source previously said.
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