POSCO Chemical Achieves Record High Sales Since Inception "Expanding Battery Material Supply Chain"

Sales of 1.9895 trillion KRW... 27.0% increase from the previous year

[Asia Economy Reporter Oh Hyung-gil] Posco Chemical has achieved its highest annual business performance, driven by growth in its energy materials business.

Posco Chemical announced on the 26th that its consolidated operating profit increased by 101.9% year-on-year to 121.7 billion KRW. Sales reached 1.9895 trillion KRW, up 27.0% from the previous year.

Strong performance was seen across all business sectors, including energy materials, lime chemicals, and refractories, resulting in the highest annual sales since the company's founding.

In the energy materials business, sales of high-nickel cathode materials for electric vehicle batteries increased, and the rise in raw material prices such as lithium and nickel was reflected in sales prices, leading to sales of 851.8 billion KRW, up 59.7% from the previous year.

Compared to 219 billion KRW in cathode and anode material sales in 2019, when Posco ESM was merged and the cathode material business was entered, sales have more than tripled in two years. The overall sales proportion also increased from 14.8% to 42.8% during the same period, driving growth.

In the lime chemical business, sales expanded due to increased sales of lime (quicklime) products following higher crude steel production and rising prices of products such as coal tar and roofing oil, resulting in sales of 675.3 billion KRW, up 16.4% year-on-year. Refractory business sales slightly increased to 462.5 billion KRW compared to the previous year.

PMC Tech, a subsidiary producing needle coke, the raw material for electrode rods and artificial graphite anode materials, recorded sales of 172.4 billion KRW, up 53.7% year-on-year, due to increased product demand from higher electric furnace operating rates. The operating profit margin was 22.1%.

Additionally, through a paid-in capital increase, the debt ratio decreased by 43.1 percentage points from 104.0% last year to 60.9%, and cash assets increased to 1.3512 trillion KRW, strengthening financial soundness.

Posco Chemical plans to expand mass production capacity and strengthen technological leadership through research and development in line with the growth of the electric vehicle market. In May, it will complete the comprehensive construction of the Gwangyang cathode material plant, the world's largest with an annual capacity of 90,000 tons, and establish global mass production bases by newly building and expanding cathode material plants in North America, China, and Pohang.

For anode materials, it will expand production facilities for low-expansion natural graphite used in electric vehicles and begin full-scale production of artificial graphite anode materials to diversify its product portfolio. This year, it will secure an annual production capacity of 105,000 tons for cathode materials and 84,000 tons for anode materials.

A Posco Chemical official said, "Following the acquisition of environmental certification from the Ministry of Environment for the anode material production process, the first among domestic battery materials, we plan to pursue certification for cathode materials as well. We will further strengthen ESG (environmental, social, and governance) management by securing transparency and stability in the battery material raw material supply chain, enhancing business competitiveness across the entire value chain from raw materials to material production."