POSCO Future M Co. said Monday it aims to achieve 3.4 trillion won (US$2.57 billion) in annual operating profit by 2030 as it accelerates the expansion into the manufacturing of secondary battery materials amid the robust electric vehicle (EV) demand.
The chemical unit of South Korean steel giant POSCO Holdings Inc. unveiled the blueprint that also included the goal of generating 43 trillion won in sales by the same year.
In 2022, the company reported 165.8 billion won in operating income on sales of 3.3 trillion won.
To achieve the mid- to long-term goals, POSCO Future M will focus on boosting its capabilities as a "total solution provider" in the entire value chain, from the sourcing of minerals to production of materials and recycling, Kim Jun-hyung, president and CEO of POSCO Future M, said at a media event.
It will aim to increase its annual production capacity of cathodes to 1 million tons by 2030, with around 70 percent of the output to come from its domestic production, while some 240,000 tons will be produced in North America and Europe, and some 65,000 tons from China and Indonesia.
POSCO Future M will diversify the battery cell types to respond to growing customer demand for nickel-rich NCM or NCA, and lithium iron phosphate (LFP) at the cheaper end as well as high-manganese cells.
Kim said he was confident about realizing the 1 million-ton milestone in the cathode production.
"It's more than possible to get to the 1 million-ton cathode production. We have a lot of finalized orders, and (additional) orders keep coming in," Kim said.
Kim said that the basic chemicals segment, mainly referring to refractories and burnt lime, will add more environmentally friendly products to its portfolio as part of efforts toward the green transition.
POSCO Future M plans to make further inroads in the overseas expansion, with Vietnam and Turkey in mind as potential markets.
POSCO Future M, formerly POSCO Chemical, had primarily engaged in the production of refractories and burnt lime since it was founded in 1971 as a POSCO arm.
In recent years, it has been aggressive in the pivot to the secondary battery components business, particularly the materials used to make cathodes and anodes -- core materials used in lithium-ion cells for EVs.
POSCO Future M touts itself as one of the few companies capable of producing both cathodes and anodes.
It supplies cathodes to Samsung SDI Co., LG Energy Solution Ltd. (LGES) and Ultium Cells LLC., the U.S. joint venture between LGES and General Motors Co.
As of late July, POSCO Future M had an order backlog of 106 trillion won.
Source: Yonhap News Agency