This photo shows LG Chem Ltd.’s nanotube production site in Yeosu, about 300 kilometers southwest of Seoul, as provided by the company on Aug. 30, 2022.
SEOUL, July 27 (Korea Bizwire) — LG Chem Ltd. said Thursday its second-quarter profit sank 30 percent from a year earlier as global demand for petrochemicals remained sluggish.
Operating income reached 615.6 billion won (US$484 million) in the April-June period, compared with 878.4 billion won the previous year, the company said in a regulatory filing.
Revenue increased 18.8 percent to 14.54 trillion won. Net income came to 670.8 billion won, down 6.6 percent from a year ago.
The earnings exceeded market expectations. The average estimate of net profit by analysts stood at 426 billion won, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.
The petrochemical division logged an operating loss of 12.7 billion won, with sales of 4.6 trillion won, amid the slowdown in demand and partly due to the maintenance and repair work for production facilities, LG Chem said.
Its advanced materials sector, which includes battery components, booked 184.6 billion won in operating income on sales of 2.2 trillion won.
The profitability in the electric vehicle battery sector waned in the second quarter due to the slowdown in EV sales in Europe and a sharp decline in metal prices, but the IT and semiconductor components business fared better compared with the previous quarter as the market regained momentum.
It expected a decline in sales and profit in the battery segment in the third quarter as the fall in metal prices will be reflected in selling prices, LG Chem said.
The life science unit, mainly engaged in drug development, posted 9.2 billion won in operating income with sales of 3.2 trillion won.
The battery-making subsidiary, LG Energy Solution, booked 460.6 billion won in operating profit on sales of 8.77 trillion won.
The operating profit of Farm Hannong, its agricultural chemicals affiliate, came to 27.4 billion won, with revenue of 247.3 billion won.
Shares in LG Chem tumbled 9.62 percent to 658,000 won on the main Seoul bourse Thursday, versus the broader KOSPI’s 0.44 percent gain. The earnings results were released before the market closed.
(Yonhap)
