http://www.morningstar.com/earnings/52741150-sociedad-quimica-y-minera-de-chile-sa-adr-sqm-q1-2013.aspx

Sociedad Quimica Y Minera De Chile SA ADR SQM
Q1 2013 Earnings Call Transcript

Transcript Call Date 05/30/2013

Operator: Good day, and welcome to the SQM First Quarter 2013 Earnings Conference Call. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

I would now like to turn the conference over to Mark Fones, Vice President of Finance and Investor Relations. Please go ahead.

Mark Fones - VP, Finance and IR: Good day, everyone, and welcome to SQM's first quarter 2013 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 our speakers are; 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 concerning the Company's business outlook, future economic performances, anticipated profitability, revenues, expenses or other financial items, anticipated cost synergies and product or service line growth, together with other statements that are not historical facts, are forward-looking statements, as that term is defined under the federal securities laws. Any forward-looking statements are estimates, reflecting the best judgment of SQM, based on currently available information and involve a number of risks, uncertainties and other factors that could cause 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 the 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 COO, Patricio de Solminihac, for brief comments before we move to Q&A.

Patricio de Solminihac T. - EVP and COO: Good morning and thank you for joining the SQM earning conference call. I will start with a brief introduction before I open up the lines for questions. For the first quarter, gross profit was slightly better than both the first and the last quarter of 2012. Having said this, we expect the remainder of 2013 to be lower than the first part of this year.

In the SPN business line, we saw increased demand during the first quarter of 2013. During this strong quarter, our volumes increased over 35% when compared to the relatively weak first quarter of 2012. Most product within the SPN business line saw higher sales volume during the first three months of 2013, which contribute to our increased revenues. However, as anticipated, average price for the business line fell about 3% when compared to the fourth quarter of 2012.

On the potash side, it is anticipated that the total market demand will exceed market demand seen in 2012, although we're seeing the impact of lower prices. We believe this market condition will continue throughout the years as market demand is expected to surpass 54 million metric ton during 2013, an increase of about 8% over last year.

As expected, the first quarter of 2013 showed strong sales volume of potassium chloride; volumes increased over 25% when compared to the first quarter of the previous year. We expect our total sales volumes of MOP and SOP fertilizers from the Salar de Atacama to be over 20% higher than the sales volumes seen last year.

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