POSCO Chemical Achieves Record Quarterly Operating Profit of 34.3 Billion KRW in 1Q

Q1 Consolidated Sales of 467.2 Billion KRW

[Asia Economy Reporter Hwang Yoon-joo] Posco Chemical has achieved its highest-ever quarterly performance driven by the full-scale expansion of its secondary battery materials business.

Posco Chemical announced that its consolidated operating profit for the first quarter reached 34.3 billion KRW, a 114.4% increase compared to the same period last year. Sales rose 20.6% to 467.2 billion KRW.

The strong performance of Posco Chemical was led by its energy materials business. Sales and profits surged significantly due to increased sales volume for electric vehicles (EVs) and strengthened cost competitiveness. Cathode material sales soared 236% year-on-year to 154.7 billion KRW, while anode material sales increased 26% to 51.9 billion KRW.

Additionally, the refractory business showed a recovery in sales due to higher operating rates at steelmakers and profitability improvement activities. In the lime chemical business, sales of quicklime slightly declined, but the chemical division saw increases in sales and profits influenced by rising oil prices.

Subsidiary PMC Tech’s needle coke business contributed to profit growth as sales prices rose due to increased demand for electric arc furnace electrodes driven by China’s low-carbon policies. PMC Tech posted an operating margin of 28.8% in the first quarter.

In January, Posco Chemical completed a paid-in capital increase worth 1.2735 trillion KRW, significantly reducing its debt ratio from 104% in the previous quarter to 47.8%. This strengthened financial soundness and laid the foundation for accelerating investments in the energy materials business.

Going forward, Posco Chemical will continue proactive investments and process innovations in the cathode material business to prepare for the expansion of the electric vehicle market. In the anode material business, it plans to focus on portfolio diversification through the development of next-generation materials such as artificial graphite and silicon-based materials, as well as marketing efforts to secure new customers.

The refractory business will strive to enter new markets and secure competitiveness by leveraging total solution capabilities based on manufacturing, maintenance, and construction in response to the recovery of demand in upstream industries. In the lime chemical business, the company intends to continue strengthening business profitability and developing new businesses through high value-added byproducts.

Posco Chemical aims to solidify its position as a global top-tier company in the secondary battery materials business by 2025 by completing a materials value chain linked to raw material procurement of lithium, nickel, and graphite promoted by the Posco Group. It plans to expand cathode and anode material mass production capacity to establish a production system of 400,000 tons of cathode materials and 260,000 tons of anode materials by 2030, achieving a 20% global market share and annual sales of 23 trillion KRW in the secondary battery materials sector.