Sales Down 11.3% Year-on-Year to 11.2 Trillion Won
Petrochemicals Return to Profit; LG Energy Solution Performance Improves
"Cost Efficiency Achieved Despite Sluggish Global Demand"
LG Chem reported a consolidated operating profit of 679.7 billion won for the third quarter of this year, marking a 38.9% increase compared to the same period last year. The improvement in third-quarter performance was driven by a return to profitability in the petrochemicals division, revenue from the export of rare disease treatment technology in the life sciences division, and improved results from its subsidiary, LG Energy Solution.
On October 31, LG Chem announced sales of 11.1962 trillion won and an operating profit of 679.7 billion won. Although sales decreased by 11.3% compared to the same period last year (12.6203 trillion won), operating profit increased by 38.9%, reflecting improved profitability. Compared to the previous quarter, sales declined by 1.9%, but operating profit rose by 42.6%. Cha Dongseok, Chief Financial Officer of LG Chem, stated, "Despite sluggish global demand, we generated improved earnings through a shift to a high-value-added, high-profit business portfolio and enhanced cost efficiency."
By business segment, the petrochemicals division returned to profitability with sales of 4.4609 trillion won and an operating profit of 29.1 billion won. This marks a return to profit in the petrochemicals division after five quarters, following a shift from profit to loss in the third quarter of last year. The company attributes this to improved spreads due to lower raw material prices and the effects of cost reduction. The advanced materials division posted sales of 838.2 billion won and operating profit of 7.3 billion won, maintaining profitability centered on electronic materials and engineering materials, despite a decline in shipments of battery materials.
The life sciences division recorded sales of 374.6 billion won and operating profit of 100.6 billion won, driven by the receipt of remaining contract payments from technology exports (license-out agreements).
Subsidiary LG Energy Solution reported sales of 5.6998 trillion won and operating profit of 601.3 billion won. Increased shipments of energy storage systems (ESS) and small batteries in North America led to improved performance.
Farm Hannong posted sales of 101.5 billion won and an operating loss of 20 billion won, but profitability is expected to improve in the fourth quarter with expanded sales of crop protection products.
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