The Chile based chemical manufacturer Sociedad Quimica y Minera de Chile (NYSE:SQM) reported revenue growth for the eighth consecutive year, with earnings 179% above the 2007 figures at US$1.91 per ADR.
The company's Total Revenues for 2008 reached US$1.77 bln, which was a significant increase from the US$1.19 bln achieved in 2007. Net Income arrived at US$501 mln.
According to product category, the SQM sold US$979 mln worth of Specialty Fertilizers, US$247 mln of Iodine and Iodine derivatives, US$172 mln of Lithium and Lithium derivatives, US$140 mln of Potassium Chloride, and US$124 mln worth of Industrial Chemicals.
With respect to the Specialty Fertilizer product category, the 69% growth was a result of a significant price increase throughout the year, offsetting the decline in sales volume. Prices for the segment rose on average 116% from 2007, which resulted mainly from the rise in prices for potassium-related fertilizers.
The company in an official statement argued that the decline in demand, which was felt mainly in the fourth quarter as a consequence of tight credit conditions, is
not sustainable given that specialty crop producers must fertilize to maximize yields and continue to provide export-quality products in order to maintain margins.
As of December 31, 2008, SQM's Net Financial Debt was US$333.8 mln, and the relationship Net Financial Debt/EBITDA was 0.45. The balance sheet showed US$446 mln of Current Liabilities, US$611 mln of Long-term Liabilities, and US$1.463 mln of Equity. Cash and Cash Equivalents increased significantly, from US$164 mln in 2007, to US$324 mln.
At the current price per ADR of US$27.13, the company trades at a P/E of 25.8, with a Market Cap of 7.14 bln. The share price has nearly doubled from the October low of $15.
The company's latest financial statements can be found here.
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