Core Viewpoint - Honda reported a 42% drop in profit for the nine months through December, primarily due to U.S. tariffs impacting earnings, marking the second consecutive year of profit decline during this period [1] Financial Performance - Honda's profit for the three quarters totaled 465.4 billion yen ($3 billion), down from 805.2 billion yen [1] - Sales for the same period decreased by 2.2% to 15.98 trillion yen ($102.6 billion) compared to the previous year [1] - The company maintained its full fiscal year profit forecast at 300 billion yen ($1.9 billion) [1] Market Dynamics - The slowdown in electric vehicle (EV) sales in the U.S. market was identified as a negative factor for Honda [1] - Honda reduced its global EV sales ratio projection for 2030 to 20% from a previous target of 30% and canceled the development of certain EV models due to market changes [1] Tariff Impact - U.S. tariffs on automobiles and auto parts were reduced from 25% to 15% by the Trump administration, which has favored the oil and gas industry [1] - Tariffs have significantly affected Japan's export-reliant economy, including its automakers [1] Industry Context - Toyota Motor Corp., another major Japanese automaker, also reported a decline in profit recently [1] - Japan's new Prime Minister Sanae Takaichi, who recently won a parliamentary election, is expected to promote policies aimed at boosting growth through increased government spending, particularly in technology and defense [1] Stock Market Reaction - Honda's stock rose by 2.1% in trading following the profit report [1] - The Nikkei 225 benchmark index increased by 2.3%, reaching a record high for the second consecutive day, partly due to Takaichi's popularity [1]

Financial Data and Key Metrics Changes - In Q1 2025, the company achieved the highest first quarter lithium sales volumes in its history, with a 20% year-on-year increase, driven by strong demand from the electric vehicle market in China and Europe [6][8] - Average realized prices for lithium in Q2 2025 are expected to be lower than in Q1 due to recent price declines [7][59] Business Line Data and Key Metrics Changes - Lithium sales volumes increased significantly, while iodine prices reached record averages amid tight supply and steady demand, particularly for X-ray contrast media applications [6][8] - Specialty Plant Nutrition (SPN) sales volumes grew healthily, with an upward trend in prices due to strong demand for potassium chloride and supply disruptions [9] - Potassium business volumes were significantly lower compared to the same period last year as part of a strategy to prioritize high lithium content brines [10] Market Data and Key Metrics Changes - The company maintains a view that global lithium demand will grow by 17% in 2025, with SQM's sales expected to grow by 15% year-on-year, although this forecast remains unchanged amid current market conditions [29][64] - The lithium market is currently oversupplied, with prices under pressure, particularly in China [71][90] Company Strategy and Development Direction - The company is focused on expanding lithium production capacity to 240,000 metric tons of lithium carbonate and 100,000 metric tons of lithium hydroxide [8] - Investment in operational efficiencies and capacity expansions is ongoing, with a commitment to sustainable high-quality growth [11] - The company is confident in its strategy and ability to generate cash flow despite current pricing pressures [17][88] Management's Comments on Operating Environment and Future Outlook - Management believes the current low price environment is unsustainable and expects prices to improve in the future [88][90] - The company is well-prepared to take advantage of market recovery due to its strong position as a low-cost producer [88][90] - There is optimism regarding long-term demand growth, particularly in the electric vehicle sector [64][90] Other Important Information - The company is advancing its seawater pipeline construction to expand iodine production capacity [8] - The dividend policy established a distribution of 30% of net income for 2025, with no interim dividends planned for the first quarter [48] Q&A Session Summary Question: Will operating cash flow be breakeven or positive per metric ton in lithium in Q2? - Management indicated they are far from breakeven costs and expect to be significantly above that in Q2 [14][15] Question: How will lower lithium prices affect capital structure and funding for future projects? - Management stated that the company has a strong balance sheet and cash generation capacity from other business lines, which will not constrain future projects [16][18] Question: What is the status of the Codelco joint venture in Chile? - Management described the situation as "noise" due to election year discussions but confirmed that the transaction is progressing as planned [20][26] Question: Will SQM's lithium sales grow by 15% this year? - Management has not updated the annual volume forecast but expects similar or slightly lower volumes in Q2 compared to Q1 [29] Question: How is SQM handling pricing dynamics in China? - Management noted that pricing mechanisms with customers are confidential and cannot provide specifics [36] Question: What is the outlook for Mt. Holland production? - Management confirmed that Mt. Holland is cash positive and ramping up as planned, despite facing higher costs during the ramp-up phase [84][97] Question: What is the company's dividend policy? - The company will distribute 30% of its net income for 2025, with no interim dividends planned for the first quarter [48]