POSCO Chemical Surpasses 1 Trillion Won in Quarterly Sales for the First Time... Battery Materials Soar (Update)

Record High Sales for 9 Consecutive Quarters... Quarterly Operating Profit Also at a Peak

[Image source=Yonhap News]

[Asia Economy Reporter Oh Hyung-gil] POSCO Chemical has surpassed 1 trillion KRW in quarterly sales for the first time ever, driven by the expansion of its battery materials business. Operating profit also reached a quarterly record high.

POSCO Chemical announced on the 24th that it achieved consolidated third-quarter sales of 1.0533 trillion KRW and operating profit of 81.8 billion KRW. Sales increased by 108.6% and operating profit by 159.9% compared to the same period last year.

Sales from the battery materials business reached 726.7 billion KRW. Due to increased sales volume and higher selling prices of cathode and anode materials, sales surged sharply by 238.9% year-on-year. The proportion of total sales rose from 42.5% in Q3 2021 to 69% within one year.

Cathode materials sales increased by 57.4% from the previous quarter to 658.3 billion KRW. Sales of high-nickel cathode materials for electric vehicle batteries grew, and new customers for energy storage systems (ESS) were secured. Additionally, price increases of raw materials such as lithium and nickel were reflected in selling prices, resulting in significant growth in both sales and operating profit.

Anode materials sales rose 47.1% from the previous quarter to 68.4 billion KRW. The overall sales volume increased by 27% quarter-on-quarter due to expanded sales of battery products, and profitability improved substantially due to price increases following raw material cost hikes.

The lime chemical business, which produces raw materials such as quicklime for steelmaking processes and coal chemical raw materials and products, recorded sales of 204.1 billion KRW, up 6.5% from the previous quarter, driven by price increases in chemical products like coal tar and roofing oil due to rising oil prices. The refractory business saw a 12.4% decline from the previous quarter to 117.2 billion KRW due to decreased sales volume.

PMC Tech, a subsidiary producing needle coke used as electrode material for electric furnaces, posted sales of 63.7 billion KRW, a 6% increase from the previous quarter due to higher sales volume of oil fractions, with an operating profit margin of 14.5%.

[Image source=Yonhap News]

POSCO Chemical is responding to global trends toward domestic supply chain establishment, including the U.S. Inflation Reduction Act (IRA), by promoting cooperation with the POSCO Group in raw materials and making proactive investments. The company plans to build a stable raw material supply chain and further expand domestic and overseas production capacity to strengthen business competitiveness.

Additionally, POSCO Chemical has established Ultium CAM, a high-nickel cathode material joint venture with General Motors (GM) in the U.S. and Quebec, Canada, and is pushing forward with factory construction aiming for completion in the second half of 2024.

To increase the internalization rate of precursors, an intermediate raw material for cathode materials, POSCO Chemical invested 326.2 billion KRW in July to expand production facilities in Gwangyang with an annual capacity of 45,000 tons. Furthermore, with the groundbreaking of the pitch plant by P&OK Chemical, a joint venture with OCI, the localization of pitch, a coating material for anode materials, has also begun.

POSCO Chemical plans to complete the entire value chain from raw materials and intermediate materials to final products for cathode and anode materials, expanding production capacity to 340,000 tons of cathode materials and 170,000 tons of anode materials by 2025, and to 610,000 tons of cathode materials and 320,000 tons of anode materials by 2030.

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