On May 18 local time, the global lithium mining giant Chile mining and chemical (SQM) disclosed the first quarterly report. In the first quarter, the company achieved a revenue of US $2.02 billion, a year-on-year increase of nearly 300%, and a net profit of US $796 million, a year-on-year increase of 107074%, which greatly exceeded the market expectation.
Affected by this news, the A-share lithium sector bucked the trend in the afternoon on May 19, Tianqi Lithium Corporation(002466) once rose by more than 6%, Ganfeng Lithium Co.Ltd(002460) rose by more than 3%, and Chengxin Lithium Group Co.Ltd(002240) rose by more than 4%.
On May 19, sqm shares rose after the opening of US stocks. As of 22:08 Beijing time, it rose 4.26% to US $94.05 / share p align = “center” picture source: China stock market news
net profit increased 107074% year on year
Sqm, a global mining company in northern Chile, is the world’s largest producer of lithium extracted from salt lakes and the second largest producer of refined lithium.
On May 18 local time, sqm released a brilliant quarterly report, with significant growth in revenue and net profit.
The net profit of the company in the first quarter was USD 796.1 million, compared with USD 68 million in the same period in 2021, with a year-on-year increase of 107074%, and the adjusted EBITDA profit margin was 58.7%; The revenue reached US $219.8 billion, up from US $528.5 million in the same period in 2021, with a year-on-year increase of nearly 300%; Earnings per share was US $2.79, compared with us $0.26 in the same period last year, with a year-on-year increase of 973.08%.
Sqm’s gross profit in the first quarter reached US $1164.7 million, compared with us $136.6 million in the same period last year, with a year-on-year increase of 752.64% and a month-on-month increase of 114.57%.
Ricardo Ramos, the company’s CEO, said: “the company’s first quarter results reflect several positive factors. The first is the positive impact of price increases in all business areas, especially the significant rise in lithium prices, followed by long-term operation and business strategy.”
sqm: the global demand for lithium salt will increase by at least 30% this year
Lithium business is the fastest growing business of sqm in the first quarter.
According to the financial report, the revenue of sqm lithium business in the first quarter totaled US $1446.4 million, a year-on-year increase of 969.5%. The gross profit of this business accounts for about 75% of sqm’s comprehensive gross profit. The company said that the price of lithium salt rose sharply month on month in the first quarter, reaching about 38000 US dollars / ton, driving the growth of the performance of the company’s lithium business segment.
Sqm said that due to the rapid growth of global new energy vehicle sales and the continuous rise of lithium salt prices, the global lithium salt market demand will increase by at least 30% this year. At the same time, sqm said that according to the market demand expectation, the company is increasing production capacity, and it is expected that the lithium salt sales will exceed 140000 tons in 2022. Among them, 50% are variable price long-term agreements, 20% are fixed price long-term agreements, and the remaining 30% have not been determined yet.
In March this year, the person in charge of sqm board of directors said that the company hopes to reach the capacity of 180000 tons of lithium in 2022; In April, it was announced that the company plans to invest US $900 million in 2022 to increase the production capacity of lithium carbonate and lithium hydroxide.
Tianqi Lithium Corporation(002466) holding 23.02%
Sqm is mainly engaged in the production and sales of lithium and its derivatives, special plant fertilizers, potassium fertilizers and industrial chemicals. Atacama Salt Lake in Chile is a lithium salt lake with high lithium concentration, large reserves and mature mining conditions all over the world.
According to the former Tianqi Lithium Corporation(002466) official wechat news, based on the optimistic long-term development prospect of the new energy vehicle market, considering sqm’s high-quality resource endowment and the scarcity of sqm equity, Tianqi Lithium Corporation(002466) completed the evaluation of sqm23 in 2018 Purchase of 77% class a equity and become its second largest shareholder.
According to the data, Tianqi Lithium Corporation(002466) currently holds 62556568 class A shares and 3196193 class B shares of sqm, and 65752761 sqm shares, accounting for about 23.02%.
With the large volume of lithium business, Tianqi Lithium Corporation(002466) as the second largest shareholder of sqm, the corresponding investment income is expected to be very considerable.
Sqm’s first quarterly report far exceeded market expectations, while Tianqi Lithium Corporation(002466) the first quarterly report also performed well, realizing an operating revenue of 5.257 billion yuan, a year-on-year increase of 481.41%; The net profit was 3.328 billion yuan, a year-on-year increase of 144265%.
Sqm and Tianqi Lithium Corporation(002466) achieved explosive growth in the first quarter, mainly benefiting from the strong demand for new energy vehicles and the rapid rise in lithium salt prices. On May 16, according to the data released by Jibang consulting, the total sales volume of global new energy vehicles in the first quarter of 2022 was 2.04 million, with a year-on-year increase of 80%. According to the data released by Shanghai Nonferrous Metals network, in April this year, the price of battery grade lithium carbonate once hit 503000 yuan / ton, a record high, up 81% compared with the beginning of this year and more than 9 times compared with 50000 yuan / ton at the beginning of 2021.
Huaxi Securities Co.Ltd(002926) pointed out that at present, the contract price of overseas lithium concentrate long-term association in the second quarter is US $5 Jiangling Motors Corporation Ltd(000550) 0 / ton, and the price of Pilbara’s recent auction is as high as US $6250 / ton after the bid is converted. At the same time, the evaluation price of lithium concentrate has exceeded US $6000. Under the background of tight supply and demand, it is expected that the price of lithium concentrate in Australia will rise further in the third quarter, and it is difficult to correct the price of lithium salt under the support of high cost.
