LG Chem Q1 Operating Profit 791 Billion KRW... 22.8% Decrease YoY

LG Chem announced on the 27th that it achieved consolidated sales of KRW 14.4863 trillion and an operating profit of KRW 791 billion in the first quarter of this year. Compared to the same period last year, sales increased by 24.9%, but operating profit decreased by 22.8%.

Excluding LG Energy Solution, LG Chem's first-quarter performance recorded sales of KRW 7.5286 trillion and an operating profit of KRW 141 billion.

Regarding the first-quarter results, LG Chem stated, “Despite the global economic downturn, sales and profitability improved across all business divisions compared to the previous quarter,” and added, “Although uncertain macroeconomic conditions are expected to continue in the second quarter, gradual demand recovery in petrochemicals and solid growth in advanced materials and energy solutions will continue.”

Looking at the detailed performance and second-quarter outlook by business division, the petrochemical division recorded sales of KRW 4.5786 trillion and an operating loss of KRW 50.8 billion. The prolonged downturn in the home appliance and construction industries due to the global economic slowdown led to weak demand for major products; however, the operating loss narrowed compared to the previous quarter due to factors such as increased operating rates following regular maintenance in the fourth quarter. In the second quarter, despite upstream supply oversupply, gradual market improvement is expected with demand recovery due to seasonal peak season entry.

The advanced materials division recorded sales of KRW 2.5614 trillion and an operating profit of KRW 202.7 billion. Demand for battery materials recovered compared to the previous quarter, resulting in significant sales growth and improved profitability of major products. In the second quarter, sales and profitability of battery materials may be affected by the declining metal prices, but the company plans to maintain solid profitability through inventory management and expanding sales of high value-added IT and semiconductor materials.

The life sciences division recorded sales of KRW 278 billion and an operating profit of KRW 16.4 billion. Sales growth compared to the previous quarter was driven by expanded sales of key products such as growth hormones and vaccines, recovery in demand for the aesthetic business, and the reflection of consolidated results from AVEO in the United States. In the second quarter, growth is expected with the launch of new diabetes treatment products and expanded sales of major products, while global clinical trials and new drug research and development (R&D) will also be expanded.

LG Energy Solution achieved sales of KRW 8.7471 trillion and an operating profit of KRW 633.2 billion. Sales growth continued due to increased shipments of electric vehicle batteries in North America and improved selling prices, while operating profit increased due to yield improvements and the reflection of expected tax benefits from the U.S. Inflation Reduction Act (IRA). In the second quarter, strong demand centered in North America is expected to continue, and securing tax benefits is anticipated through the expansion of local production capacity in the U.S. and stable mass production development.

Farm Hannong recorded sales of KRW 265.4 billion and an operating profit of KRW 34.1 billion. Sales increased compared to the same period last year due to expanded domestic and overseas sales of crop protection products. In the second quarter, annual sales growth and profitability improvement are expected through expanded overseas sales of crop protection products and structural improvements in fertilizer and seed businesses.

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