Sociedad Quimica y Minera de Chile SA Q4 FY2024 earnings call

• Full-year 2024 revenues slightly exceeded $4.5 billion, gross profit ~$1.3 billion. Net income impacted by ~$1.1 billion one-time tax charge related to mining tax dispute. - Lithium market grew ~25% in 2024 due to EV and energy storage demand. SQM achieved record lithium sales volumes in 2024 and Q4 2024. Prices declined in 2024 but softened in Q4, expected stable in 2025. - Iodine had exceptional 2024 with record volumes and price growth; working on capacity expansion and efficiency initiatives. - Invested over $1.6 billion in 2024; plan to allocate ~$750 million in 2025 for lithium capacity expansion, ~$350 million in caliche operation.

Lithium: In 2024, SQM achieved record sales volumes, reaching nearly 205,000 metric tons of lithium (including ~4,000 metric tons from Mt. Holland). Fourth quarter sales volumes surpassed 58,000 metric tons of lithium carbonate equivalent. The lithium market grew ~25% in 2024. Expect demand to grow ~17% in 2025 with sales volumes growing similarly. Allocated ~$750 million for lithium capacity expansion in 2025. Iodine: Had an exceptional 2024 with record volumes and strong price growth. Expect continued demand growth in 2025 but at a slower pace, with sales volumes expected similar or slightly lower than 2024. Working on expanding capacity. Fertilizers: Market fully recovered, prices stabilized in 2024. Committed to investing in core business expansion.

• Lithium demand expected to grow ~17% in 2025, sales volumes to grow similarly. - Iodine sales volumes in 2025 expected similar or slightly lower than 2024. - Expect relatively stable lithium prices in 2025. - Plan to allocate ~$750 million in 2025 for lithium capacity expansion, ~$350 million in caliche operation.

• Tax treatment dispute impacting net income. - Policy uncertainties in U.S. and Europe affecting lithium demand. - Oversupply in lithium market in 2025 potentially impacting prices. - Uncertainties in execution of CapEx projects.

Q: On potash, guidance of production down 50% this year, combination of growth in SPN and more efficient production at Salar, and possibility of being net buyer of potash?

A: Carlos Diaz Ortiz stated production down due to focus on lithium, extracting less brine, and potash production correlated with brine extraction.

Q: On capital requirements over next two or three years, funding gap and raising capital?

A: Gerardo Illanes said balance sheet strong, monitoring to ensure strong balance sheet, no immediate plan to raise capital but monitoring.

Q: On iodine business, possibility to repackage and spin out?

A: Gerardo Illanes said iodine is a key component, not planning to repackage or spin out currently, focusing on expanding iodine capacity.

Q: On lithium demand and supply, demand growing 17%, supply growing 10%, reason for optimism?

A: Pablo Hernandez said demand growing ~17%, supply growing ~10%, with oversupply in 2025 expected lower than 2024, potentially impacting prices positively in 2026.

Q: On own production, underproducing and capability to push production if demand better?

A: Carlos Diaz Ortiz said strategy to produce as per defined plan, expect to produce 230,000 metric tons in 2025, differentiating between capacity and actual production, expanding capacity.

Q: On Codelco JV, next milestones?

A: Carlos Diaz Ortiz said working with Codelco, Corfo, and SQM to meet conditions, expecting conditions to be met in second half of 2025.

Q: On CapEx estimate, specific projects and maintenance CapEx?

A: Gerardo Illanes said 2025 CapEx ~$1.1 billion, maintenance CapEx ~$250-280 million per year. Carlos Diaz Ortiz and Pablo Altimiras and Mark Fones detailed CapEx for lithium, iodine, and international lithium projects.

Q: On 4Q lithium volume, why high, China customer buying?

A: Felipe Smith said no price speculation or extraordinary inventory building, reasonable inventories to sustain demand growth.

Q: On Africa and Australia projects, mine plan for Africa and Mt. Holland update?

A: Mark Fones said Africa project in Namibia is early exploration, Mt. Holland refinery construction near completion, expect first product mid-2025.

Q: On CapEx 2024, break down M&A, organic, maintenance?

A: Mark Fones said ~$350 million related to Azure acquisition, rest for lithium expansions in Chile and Mt. Holland.

Q: On 2025 volume distribution, first and second quarter vs second half?

A: Felipe Smith said Q1 2025 sales volume ~50,000 ton LTE, increasing in Q2-Q4, highest in Q4.

Q: On potential impacts on [indiscernible] construction and cash costs increase?

A: Pablo Altimiras said reviewing impacts on Caliche projects, cash cost increase in Q4 due to onetime expenditures for recovery and production improvement, expect similar cost to second half 2024 in 2025