Kumho Petrochemical, Expectations for Improved Performance

[Asia Economy Reporter Park Soyeon] Kumho Petrochemical is enjoying a windfall as the three factors of increased sales, price hikes, and exchange rate effects after the COVID-19 pandemic coincide to improve its performance.

According to the petrochemical industry on the 6th, the demand for NB latex, a material for medical gloves, surged due to the COVID-19 outbreak, significantly increasing Kumho Petrochemical's production volume. The company expanded its NB latex production capacity from 400,000 tons to 550,000 tons at the end of last year and is currently operating at full capacity.

As COVID-19 spread not only in China and Korea but worldwide, orders have been pouring in to Kumho Petrochemical, the global No.1 NB latex producer. Product selling prices have also risen. This is because latex production plants in China halted production for more than two weeks due to the COVID-19 situation, causing a significant reduction in global supply.

An industry official said, "After the COVID-19 outbreak, demand and supply lost balance, leading to price increases, and the won-dollar exchange rate once exceeded 1,220 won, resulting in improved profitability from exchange gains, so performance improvement is expected."

Kumho Petrochemical expects annual sales of over 700 billion won and an operating profit margin of over 15% this year. Previously, the industry forecasted that the NB latex market would grow at an average annual rate of over 10% for the next five years, but due to the COVID-19 situation, the growth rate is expected to be even higher.

This content was produced with the assistance of AI translation services.