Lotte Chemical (011170)

Lotte Chemical, established in 1976, is a leading comprehensive chemical company in South Korea. Its main business areas include basic chemicals, advanced materials, battery materials, hydrogen energy, and specialty chemicals. Key products include synthetic resins such as polyethylene (PE) and polypropylene (PP); petrochemical products such as ethylene (EO) and ethylene glycol (EG); basic petrochemicals such as benzene (BZ) and toluene (TL); high-performance synthetic resins such as ABS and PC; and building/interior materials. Furthermore, the company is securing future growth engines through copper foil (Elecfoil) for secondary battery anode current collectors, hydrogen fuel cell power generation, and the operation of hydrogen shipping centers. As of Q1 2025, the revenue breakdown is basic chemicals 67.2%, advanced materials 28.3%, specialty chemicals 9.1%, and battery materials 3.2%. Its major customers range from large corporations to small and medium-sized enterprises in the automotive, electrical and electronics, and plastics processing industries, and it exports products to over 120 countries worldwide. Lotte Chemical possesses international-scale production facilities in major domestic petrochemical complexes such as Yeosu, Daesan, and Ulsan, and operates business sites in various overseas locations including China, Mexico, Hungary, and Vietnam, leveraging a global production and sales network as a core strength. The company is accelerating its transition to high-value specialty materials and expanding its high-value product portfolio, such as Super EP, based at its Yulchon compounding plant. Furthermore, it is strengthening its competitiveness through proactive investment and technological expertise in eco-friendly future businesses, including copper foil for secondary batteries and hydrogen energy. Lotte Chemical's revenue decreased from KRW 20.4303 trillion in 2024 to KRW 18.4830 trillion in 2025, showing negative growth. Operating income recorded losses for several years, deteriorating profitability, with KRW -762.6 billion in 2022, KRW -894.0 billion in 2024, and KRW -943.6 billion in 2025. However, in Q1 2026, the company successfully turned to profit for the first time in 10 quarters, recording revenue of KRW 4.9905 trillion and operating income of KRW 73.5 billion, signaling an improvement in profitability. In Q1 2025, revenue was KRW 4.9018 trillion and operating loss was KRW 126.6 billion, while in Q3 2025, revenue was KRW 589.0 billion and operating income was KRW 112.3 billion. Examining Lotte Chemical's financial soundness, the debt-to-equity ratio has shown a continuous upward trend, increasing from 55.14% in 2022 to 65.46% in 2023, 72.87% in 2024, and 76.52% in 2025. The current ratio was favorable at 148.28% in 2022 and 150.45% in 2023, but it declined to 105.66% in 2024 and 104.18% in 2025, indicating a need for caution regarding short-term liquidity. ROE was 0.16% in 2022, and ROE for 2023, 2024, and 2025 is not included in the provided data. In response to the structural transformation phase of the global petrochemical industry, Lotte Chemical is optimizing its portfolio by expanding the proportion of high-value specialty products, moving away from a business structure centered on commodity products. The company is enhancing business efficiency through domestic NCC (Naphtha Cracking Center) integration and restructuring, along with the divestment of non-core assets, and is fostering eco-friendly future businesses such as secondary battery materials, hydrogen energy, and recycled materials as new growth engines. Specifically, it plans to strengthen its competitiveness in eco-friendly energy businesses through the expansion of its battery materials business, including high-value circuit foil for electric vehicles and AI servers, and the additional operation of the Ulsan hydrogen fuel cell power plant.