Lotte Chemical Reports Q3 Operating Profit of 28.1 Billion KRW... Ends 5-Quarter Consecutive Losses

Lotte Chemical announced on the 9th that it recorded sales of 4.8157 trillion KRW and an operating profit of 28.1 billion KRW in the third quarter of this year, turning profitable. This ended five consecutive quarters of losses that had continued since last year. Sales decreased by 12.5% compared to the previous year.

By business division, the Basic Materials Business posted sales of 2.5829 trillion KRW and an operating loss of 24.2 billion KRW. Although sales slightly declined due to continued weak demand, profitability improved thanks to a positive lagging effect from rising crude oil prices and operational efficiency. The lagging effect refers to the margin difference caused by a gap of more than one month between the crude oil purchase timing and the sales timing in terms of cost. Despite expected increased volatility in raw material prices amid global economic uncertainties, supply burdens are anticipated to gradually ease going forward.

The Advanced Materials Business recorded sales of 1.0684 trillion KRW and an operating profit of 75.5 billion KRW. Profitability improved due to increased sales volume entering the seasonal peak. However, demand is expected to weaken in the fourth quarter due to the seasonal off-season and the impact of the United Auto Workers strike in the U.S.

Lotte Chemical Titan posted sales of 556.4 billion KRW and an operating loss of 7.7 billion KRW. Profitability improved due to a positive lagging effect from rising crude oil prices. Although a weak market is expected due to raw material price uncertainties from geopolitical risks and delayed demand recovery, efforts to improve profitability will continue by optimizing operating rates.

LC USA recorded sales of 121.3 billion KRW and an operating loss of 16 billion KRW. Profitability declined due to cost burdens from rising natural gas prices, but with raw material prices stabilizing downward, profitability is expected to improve in the fourth quarter.

Lotte Chemical stated, “In response to rapid changes in international affairs and the chemical industry, we will maximize profitability and optimize efficiency by expanding high-value specialty products in existing businesses.” They added, “Battery materials, hydrogen energy, and recycling businesses will proceed rapidly as planned.”