Lotte Chemical Precision, Operating Profit of 50.4 Billion KRW Last Year... 67.4% Decrease "Due to Economic Slowdown"

Sales Down 5.5% Year-on-Year
"Decline in ECH Sales Volume Among Key Factors"

Due to last year's economic slowdown, Lotte Fine Chemical's consolidated operating profit decreased by 67.4% compared to the previous year.

Urolox Production Facility at Lotte Fine Chemical Ulsan Plant

Lotte Fine Chemical announced on the 5th that its annual sales last year were 1.6705 trillion KRW, and operating profit was 50.4 billion KRW, down 5.5% and 67.4% respectively from the previous year. The company cited the overall economic slowdown last year, which led to a decrease in sales volume of epoxy resin raw material epichlorohydrin (ECH), and a drop in international ammonia prices as the main reasons.

However, in the fourth quarter, sales amounted to 428.6 billion KRW and operating profit to 12.2 billion KRW, increasing by 4.2% and 43.5% respectively compared to the same period last year. The company analyzed that the completion of the TMAC expansion, a raw material for semiconductor photoresist, in the second half of last year helped respond to the expanding front-end demand such as semiconductors, and the continuous expansion of sales of cellulose-based products compared to the previous year positively contributed to the increase in sales of high value-added specialty products.

Lotte Fine Chemical will secure the world's number one production capacity in the cellulose food and pharmaceutical derivatives market through the expansion of its cellulose food and pharmaceutical factory, scheduled for completion in the second half of this year. The sales of the expanded TMAC volume will also be fully reflected, and further strengthening of the high value-added specialty portfolio is expected.

Additionally, the company plans to lay the foundation for becoming Asia's clean ammonia hub by entering the clean ammonia bunkering (ship fuel) business.

Seungwon Jeong, CEO of Lotte Fine Chemical, said, "Despite the difficult market conditions last year, Lotte Fine Chemical continuously expanded the proportion of high value-added specialty sales, which ultimately led to a turnaround in fourth-quarter performance." He added, "This year, we will accelerate the transition to a high value-added portfolio through proactive investments in specialty materials such as the expansion of the food and pharmaceutical cellulose factory."