LG Chem logged a 1st quarter business performance that exceeded market expectations. LG Chem said on April 28 the company posted 7.115.7 trillion won in sales and 236.5 billion won in operating profit in Q1. A recent market consensus predicted that LG Chem would chalk up 142.4 billion won in operating profit.

LG Chem saw Q1 sales decline 5.5 percent compared to the previous quarter, but the company recorded an operating profit. The company saw sales increase 7.5 percent compared to the same period last year, but operating profit plunging 15.8 percent.

LG Chem CFO Cha Dong-suk said, “The better-than-market consensus business performance is owed to improved spread of major petrochemical products, a reduction in losses on the back of retrenching of EV battery business costs, and advanced material business portfolio and cost efficiency.”

The petrochemical business posted 3.695.9 trillion won in sales and 242.6 billion own in operating profit in Q1. The business saw sales decline compared to the previous quarter, but it was evaluated to perform well on the back of an improved spread of major products.

In the second quarter, demand is uncertain due to the economic fallout caused by the novel coronavirus, but profitability of major raw materials is forecast to recover on the back of continued low crude oil prices.

A reduction in unit prices on the back of low crude oil is expected to be greater than a drop in demand, LG Chem officials said.

The EV battery business logged 2.260.9 trillion won in sales and 51.8 billion won in operating loss in Q1. The business saw Q1 loss declining from 249.6 billion won in Q4 2019. Even though side effects, caused by the COVID-19 pandemic, are predicted to be evitable, the business is forecast to see sales rising on the back of improved yields of the Polish production operation, LG Chem said.

LG Chem Recognized for Promoting Shared Growth

LG Chem topped a shared growth evaluation index for the fourth consecutive year, which includes large- and small-companies, according to the Korea Commission for Corporate Partnership (KCCP).

LG Chem put forward five strategies to promote shared growth - creating a fair transaction environment; overhauling financial support and settlement conditions; conducing corporate partnership in safety; environment and energy; ramping up cooperative companies’ capabilities; and sharing information and communicating. The company has implemented detailed steps related to the strategies.

LG Chem has introduced a standard contract system and four action plans, as suggested by the Fair Trade Commission. The company has made efforts to conduct fair practices with its cooperative companies.
LG Chem provides easy loans worth 100 billion won to its cooperative SMEs, materials, parts and equipment partners.

LG Chem to Expand CNT Production Capacity of ‘Dream Material’ CNT

LG Chem plans to expand production capacity of carbon nanotubes (CNT) to clinch a bigger share of the global market. The company also plans to create new markets to utilize CNT on top of its use for lithium-ion batteries.

LG Chem said on April 27 it will invest 65 billion won in expanding CNT production capacity at its plant in Yeosu by 1,200 tons. That investment will happen by the end of the next quarter.

When the expansion is finished, the plant will see annual CNT production capacity from current 500 tons to 1,700 tons.

CNT is a next-generation new material. It has electric and heat conductivity equivalent to copper and diamond, and its intensity is 100 times that of steel. Thanks to its properties that are superior to existing materials, its use is wide ranging including batteries, semiconductors, automobile parts, aircraft fuselages, etc.

Regarding this extension, LG Chem stated the measure was taken to not only target the global EV market, but also the CNT market that has recently been rapidly growing for use in anode conductive additives of lithium ion batteries.

A conductive additive is a material that helps with the flow of electricity and electrons.

It is used as an additive in lithium ion batteries. It increases conductivity of lithium ions within the anode material comprised of active materials such as nickel, cobalt and manganese.

By using CNTs as anode conductive additives, it is possible to realize high conductivity upwards of about 10% compared to existing carbon black and reduce the amount of conductive materials usage by about 30%, and that space can be filled with necessary anode materials to increase the capacity and life of lithium ion batteries.

Thanks to these features, CNT demand is expected to post explosive growth of an annual average of about 34% to rise from 3,000 tons last year to 13,000 tons by 2024 mainly centering on the global EV market.

In particular, as the world leader of EV batteries, LG Chem plans to further strengthen product competitiveness by actively utilizing CNT lithium ion batteries.

It also plans to gradually increase sales to global IT materials companies and end-car makers in North America, Europe and China and it is also scheduled to review plans for additional extensions in 2022.