LG Chem Reports Record-High Q1 Sales Since Inception, Operating Profit Down 27.3% YoY

Sales of 11.6081 trillion won... Record Quarterly Sales
Operating Profit Declines Due to Rising Raw Material Costs and Worsening External Environment

[Asia Economy Reporter Hwang Seoyul] LG Chem achieved the highest quarterly sales ever in the first quarter of this year, but operating profit decreased compared to last year due to deteriorating profitability in the battery and petrochemical businesses.

LG Chem announced on the 27th that it recorded consolidated sales of 11.6081 trillion KRW and operating profit of 1.0243 trillion KRW in the first quarter of this year. Sales increased by 20.4% compared to the same period last year, marking the highest quarterly sales since the company's founding, but operating profit decreased by 27.3%.

By business segment, the petrochemical division recorded sales of 5.9635 trillion KRW and operating profit of 634.6 billion KRW. Operating profit decreased by about 35.5% compared to the same period last year (983.8 billion KRW) due to rising raw material prices caused by oil price increases and worsening external conditions such as lockdown measures in major Chinese cities. However, differentiated product portfolios such as POE films for solar panels and SAP (superabsorbent polymer) for diapers helped achieve the highest quarterly sales.

The energy solutions division, managed by subsidiary LG Energy Solution, posted sales of 4.3423 trillion KRW and operating profit of 258.9 billion KRW.

Operating profit decreased by 24.1% compared to the same period last year (341.2 billion KRW) due to rising raw material prices, vehicle semiconductor shortages, and supply difficulties caused by Russia's invasion of Ukraine and other factors.

The advanced materials division recorded sales of 1.568 trillion KRW and operating profit of 153.8 billion KRW. It achieved the highest quarterly sales centered on expanded shipments of battery materials. Profitability also improved due to increased shipments of premium products such as high-nickel cathode materials, OLED materials, and semiconductor materials.

The life sciences division recorded sales of 217.4 billion KRW and operating profit of 32.2 billion KRW, while agricultural business subsidiary Farm Hannong recorded sales of 260.8 billion KRW and operating profit of 40.8 billion KRW.

Although uncertainties such as vehicle semiconductor supply disruptions and geopolitical risks are expected to continue in the energy solutions business, sales to major dedicated customers are expected to expand.

LG Chem Vice Chairman Cha Dongseok stated, "We expect sales growth in the second quarter compared to the first quarter," adding, "We will strive to enhance operational efficiency to generate solid profits."

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