We have said during the past years that this business has the potential of double digit growth. Our management team has delivered that growth in the past ten years and we expect that growth rate to continue in the future. Therefore, it is important for me to explain the reported growth of only 3.5% in constant currency terms in this quarter.
As you know, a byproduct of our Lithium production is potash which is sold as a fertilizer. In the past, we used to sell our potash exclusively in semi-finished form to a Chilean company. In 2011 we made a strategic decision to build our own finishing facility so that we will be able to sell the finished potash product directly to the market. We expect that this will eventually result in higher profitability for us.
Therefore, as of January 1, 2012, we have canceled our contract with the Chilean company and are in the process of establishing the infrastructure to sell products directly to the market. Since all of the required infrastructure was not in place, our sales of potash in the first quarter of 2012 was about $7 million, less than the comparable quarter last year. We expect to sell the potash produced and stored in the first quarter in the coming months.
If we exclude this potash sales, the rest of our lithium business grew by double digits in the first quarter. One other important item to mention is the sale to the lithium iron battery market, which will be the main engine of growth in the future. Our battery grade lithium sales in the first quarter of 2012 grew more than 100% versus first quarter of 2011.Read the rest of this transcript for free on seekingalpha.com
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV