Sociedad Quimica y Minera S.A.

Good day, everyone, and welcome to the SQM second quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To participate, you will need to press star 1-1 on your telephone. You will then hear a message advising your hand is raised. To withdraw your question, simply press star 1-1 again. Please note this conference is being recorded. Now it's my pleasure to turn the call over to the Investor Relations Officer, Isabel Bentec. Please proceed.

Thank you, operator. Good day, everyone, and thank you for joining SQM Earnings Conference Call for the second quarter of 2025. This call is being recorded and webcast live. Our earnings press release and results presentations have been uploaded to our website where you can also find a link to the webcast. Today's participants include Mr. Ricardo Ramos, Chief Executive Officer, Mr. Gerardo Illanes, CFO, Mr. Carlos Diaz, CEO of Lithium Chile Division, Mr. Pablo Altimira, CEO of the Iodine and Plant Nutrition Division, Mr. Mark Fons, CEO of the International Lithium Division. Also joining us today are members of our Commercial and Business Intelligence Team. Mr. Felipe Smith, Commercial Vice President of the Lithium Chile Division. Mr. Pablo Hernandez, Vice President of Strategy and Development of Lithium Chile Division. Mr. Juan Pablo Velolio, Commercial Vice President of Plant Nutrition and Specialty Products and Mr. Max Vial, Head of Studies of International Living Division. Before we begin, please note that statements made during this call regarding our business outlook, future economic performance, anticipated profitability, revenues, expenses, and other financial items, along with expected cost synergies and product or service lines growth, are considered forward-looking statements under the U.S. Federal Securities Law. These statements are not historical facts and are subject to risks and uncertainties that could cause actual results to differ materially. We assume no obligation to update these statements, except as required by law. For a full discussion of forward-looking statements, please refer to our earnings press release and presentation. With that said, I will now turn the call over to our Chief Executive Officer, Mr. Ricardo Ramos.

Good morning, everyone, and thank you for joining us. I would like to take a few minutes to share some highlights and provide a bit of color before we move to your questions. As expected, during the second quarter, we faced lower lithium prices compared to the earlier this year. We dropped revenues down by more than 30% year on year. More recently, we have seen a change in market dynamics, with prices improving in the past few weeks. compared to the level observed in May and June. We're seeing a strong demand growth coming from EV and BEST, particularly in China, but also Europe has surprised us with a stronger than expected demand growth. I'm pleased to share some positive news from Australia. Despite the expected lower sales volume seen in the second quarter, we're updating our sales guidance for the International Lithium Division to approximately 20,000 metric tons of lithium carbonate equivalent for the full calendar year 2025. As the mine is reaching full capacity, in addition, Kiwana Refinery is now complete and delivers its first product on spec, on budget, and on time last month. The ramp-up is underway, and when at full capacity, the project is expected to produce 50,000 metric tons of lithium hydroxide annually, with half attributable to SQM. Lithium sales volumes from product coming from the Salar de Atacama were almost flat compared to last year, as lower prices triggered contract floors that impacted volumes. Nevertheless, we expect the yearly sales volume from our Chilean operations to increase by at least 10% versus 2024. Beyond lithium, our business continues to deliver solid results. Ayuran was our most profitable segment in the second quarter, with an adjusted gross margin of 57%, and contributing more than 50% to the total company gross profit. Prices remain strong, supported by healthy demand and tight supply. And we expect this strength to continue into the coming years. In fertilizers, our specialty plant nutrition business remains stable, reflecting resilient demand across our key markets. While potassium volumes are lower as guided, but prices remain firm. Overall, Our diversified portfolio positions us well to navigate in a volatile environment. We are confident that SKM is well-placed to capture the strong fundamentals of the lithium market while continuing to deliver solid results across all our businesses. Thank you, and we look forward to your questions.