Lotte Chemical, Q1 Operating Profit 623.8 Billion KRW... Returns to Profitability

[Asia Economy Reporter Hwang Yoon-joo] Unlike the first quarter of last year, when Lotte Chemical recorded operating and net losses, the company succeeded in turning a profit in the first quarter of this year.

Lotte Chemical announced on the 7th that its consolidated operating profit for the first quarter of this year was 623.8 billion KRW, marking a turnaround compared to the same period last year. During the same period, sales increased by 27.3% to 4.1683 trillion KRW, and net profit turned positive at 537.9 billion KRW.

Lotte Chemical explained, "Profitability improved due to the normalization of operations at the Daesan plant, the recovery of the global economy that had been depressed by the impact of COVID-19, and the effects of the cold wave in the United States."

By business segment, the olefin division within the basic materials business recorded sales of 1.9283 trillion KRW and an operating profit of 313.1 billion KRW. Profitability improved due to increased production and sales volume following the normalization of the Daesan plant, a sharp decline in global supply caused by the U.S. cold wave, and demand recovery. The aromatic division achieved sales of 527.8 billion KRW and an operating profit of 39.9 billion KRW. Profitability greatly improved due to increased demand for food and beverage containers and higher sales volume of PIA.

The advanced materials business recorded sales of 1.0414 trillion KRW and an operating profit of 115.7 billion KRW. Steady profitability was demonstrated through improved profitability of ABS and PC, driven by increased demand for COVID-beneficiary products such as home appliances, gaming consoles, and TVs.

Lotte Chemical Titan posted sales of 651.1 billion KRW and an operating profit of 133.1 billion KRW. Sales and profits increased significantly due to a decrease in import volume caused by North American facility shutdowns and container shortages from the cold wave, alongside steady demand for disposable and hygiene products.

LC USA recorded sales of 152.2 billion KRW and an operating profit of 48.6 billion KRW. Despite shutdowns caused by the abnormal cold wave, it achieved the highest profitability since the start of commercial production due to stable raw material prices and product price increases.

Regarding second-quarter performance, Lotte Chemical stated, "Although an influx of new production capacity is expected, demand growth due to the global economic recovery is anticipated to maintain solid performance at the level of the previous quarter," adding, "We will actively pursue ESG (Environmental, Social, and Governance) management by expanding eco-friendly and recycled products, while strengthening our material portfolio to secure future growth markets."