Lotte Joins Forces to Overcome Crisis, Message from Chairman Shin Dong-bin

Lotte to Present H2 VCM Portfolio Enhancement and Global Expansion Strategy at Lotte World Tower on 18th

Shin Dong-bin, Chairman of Lotte, is convening with the group’s top executives (CEOs) to seek sustainable growth strategies and overcome crises amid increasing uncertainties in the business management environment.

Lotte Chairman Shin Dong-bin visited the Lotte Meeting Room at the Kyoto Consumer Goods Forum (CGF) in Japan on the 7th of last month to wish for the successful bid of the '2030 Busan World Expo' with Ramon Laguarta, CEO of PepsiCo.
[Photo by Lotte Holdings].

On the 18th, Lotte will hold the '2023 Second Half VCM (Value Creation Meeting, formerly the Presidents’ Meeting)' at Lotte World Tower in Jamsil, Songpa-gu, Seoul, chaired by Chairman Shin, to discuss group management and mid-to-long-term strategies. The VCM, held from 2 p.m. to 6 p.m., will be attended by about 80 people, including Chairman Shin, Lee Dong-woo, CEO of Lotte Holdings, general managers of each business division, heads of affiliates, and executives of Lotte Holdings.

At this VCM, Lotte will review external factors driving changes in the business environment, such as increased geopolitical uncertainty, a low-growth trend due to low birth rates and aging population, and digital transformation, and explore ways to achieve sustainable growth. To this end, external experts will be invited to give lectures on 'Changes and Prospects of the Global Economic Paradigm' and 'The Meaning and Business Applications of Generative AI.' Following this, Lee Dong-woo, CEO of Lotte Holdings, will review the first half’s business performance and present guidelines for sustainable growth, including overseas business strategies and efficient investment execution.

The current status and plans for nurturing new growth engines that Lotte is pursuing, such as health and wellness and mobility, will also be shared. Lotte Biologics aims to achieve its vision of becoming a 'Top 10 Global CDMO (Contract Development and Manufacturing Organization) by 2030' by establishing three mega plants in Korea by 2030, with a total antibody drug production capacity of 360,000 liters (ℓ). Each plant will have a production capacity of 120,000ℓ for antibody drugs, and small-scale bioreactors and finished drug facilities for clinical material production will also be added. Lotte Biologics has selected Songdo International City in Incheon as the mega plant hub suitable for this mid-to-long-term plan. Last month, Lotte Holdings, Incheon City, and the Incheon Free Economic Zone Authority signed a four-party memorandum of understanding to expedite the establishment of domestic biopharmaceutical production facilities.

On the other hand, Lotte Healthcare, another pillar of health and wellness, will open the healthcare platform 'Kazle' in September, which provides comprehensive services such as health functional foods, exercise equipment, and customized diets based on data analysis results from genetic testing and health checkups. In the mobility sector, Lotte Information & Communication is strengthening its business capabilities centered on autonomous driving shuttles, electric vehicle charging infrastructure, and urban air mobility (UAM).

Next, general managers of major business divisions will present strategies to enhance corporate competitiveness. The distribution division will discuss plans to advance its portfolio in lifestyle, grocery, and data commerce to achieve the vision of becoming 'the customer’s first shopping destination.' In the second half of this year, the distribution division will also focus on the successful opening of 'Lotte Mall West Lake' in Hanoi, Vietnam. Lotte Mall West Lake, a complex consisting of a department store, hotel, and office, is located in a traditional affluent area and a foreign resident commercial district. The goal is to turn profitable in its second year of operation. Efforts to become the 'No. 1 online grocery market' will also accelerate. A state-of-the-art logistics center, developed in partnership with UK retail tech company Ocado, will begin construction in Busan by the end of the year. The facility will cover 40,000㎡ and is scheduled for completion in 2025. Lotte plans to invest about 1 trillion KRW by 2030 to open six customer fulfillment centers (CFCs) nationwide and aims to achieve 5 trillion KRW in online grocery sales by 2032.

The food division will explain plans to improve profitability through upgrading the existing business value chain, expand global business, and secure future growth engines using food tech. The chemical division will share strategies to strengthen existing business competitiveness and foster new businesses such as battery materials and hydrogen ammonia.

Meanwhile, Shin Yoo-yeol, the eldest son of Chairman Shin and Executive Director of Lotte Chemical, also attended the VCM. Executive Director Shin first attended the VCM held face-to-face in January after three years of COVID-19. Recently appointed as CEO of Lotte Financial in Japan, he was also named co-CEO of Lotte Strategic Investment (LSI), the largest shareholder of Lotte Financial, in August last year. He consistently accompanies Chairman Shin at major domestic and international events, fueling speculation that the third-generation management succession of Lotte Group will accelerate.

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