LG Chem Reports 55.2 Trillion KRW in Sales and 2.5 Trillion KRW Operating Profit Last Year (Summary)

Petrochemicals, Regional Diversification and New Business Development in Full Swing
Advanced Materials, Increase in Anode Material Shipments

Shin Hak-cheol, Vice Chairman of LG Chem / Photo by Hyunmin Kim kimhyun81@

LG Chem announced on the 31st that it achieved consolidated sales of KRW 55.2498 trillion and an operating profit of KRW 2.5292 trillion last year. Sales increased by 8.4% compared to the previous year, but operating profit decreased by 15.1% year-on-year.

In the fourth quarter of last year, LG Chem recorded consolidated sales of KRW 13.1348 trillion and an operating profit of KRW 247.4 billion. Sales decreased by 3.8% compared to the same period last year, but operating profit increased by 18.2%.

Regarding last year's performance, LG Chem CFO (Chief Financial Officer) Cha Dong-seok said, "It was a year of extreme volatility due to external factors, including a continued downturn in the petrochemical industry caused by global demand slowdown, market concerns over electric vehicle demand, and a sharp drop in metal prices such as lithium, which affected sales and profitability."

Excluding LG Energy Solution, LG Chem's sales last year were approximately KRW 26.6 trillion. LG Chem has set its sales target for this year at KRW 27.8 trillion, a 5% increase from the previous year.

Regarding this year's business outlook, CFO Cha Dong-seok stated, "Although difficult management conditions will continue due to geopolitical risks in the Middle East, global economic conditions, and a slowdown in electric vehicle demand growth, this year will be a turning point for substantial growth and profitability improvement in nurturing the three new growth engines through ▲regional diversification strategy in the petrochemical sector and full-scale development of sustainability businesses ▲increased cathode material shipments through diversification of customer projects in the advanced materials sector ▲and accelerated global clinical development centered on AVEO in the life sciences sector."

Through a conference call, LG Chem set its cathode material shipment guidance for this year at 40% growth compared to last year. However, it expects limited sales growth due to a decline in cathode material prices.

LG Chem stated, "We have set an annual target of 40% growth, exceeding the market growth rate on a volume basis through new project entries. However, sales growth will be limited due to the decline in metal prices." It added, "Last year, the advanced materials division's profitability declined due to negative profit and loss impacts from inventory as lithium nickel prices continued to fall."

LG Chem also revealed plans to invest more than KRW 4 trillion annually in CAPEX for the three major growth engines (battery materials, eco-friendly materials, and innovative new drugs) over the next 2 to 3 years.

LG Chem said, "Last year, we executed investments of about KRW 3.4 trillion focused on the three new growth engines, which was somewhat reduced compared to the planned level. This year, with the full-scale commencement of the North American cathode material plant construction, investment scale is expected to increase compared to last year." It added, "With the North American cathode material plant construction fully underway this year, increased investments are planned, and over the next 2 to 3 years, investments related to the three new growth industries will be concentrated. Financially, about KRW 4 trillion in investments are expected to be executed annually over the next 2 to 3 years."

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