SEOUL– Lotte Chemical Corp. said Thursday it shifted to the red in 2022 as a rise in global oil prices and weak demand hurt overall profitability.
Operating loss came to 758.4 billion won (US$601.4 million) in the January-December period, turning from a profit of 1.53 trillion won the previous year, the chemical materials unit of South Korean retail giant Lotte Group said in a regulatory filing.
Annual sales rose 22.9 percent to 22.27 trillion won. Net profit reached 41.1 billion won, down 97.1 percent from a year earlier.
“External instability continued, such as China’s COVID-19 lockdowns, the prolonged Russia-Ukraine war, falling prices and deteriorating demand due to the economic downturn, as well as the increase in raw material prices,” Lotte Chemical said.
The company also shifted to an operating loss of 395.8 billion won in the fourth quarter, from 29.5 billion won in profit a year ago. It posted a net loss of 80.6 billion won, turning from a profit of 62 billion won a year earlier.
Sales grew 6.5 percent on-year to 5.49 trillion won in the three-month period.
Basic materials segment, mainly the naphtha cracking business, booked an operating loss of 285.7 billion won, with sales reaching 3.16 trillion won.
Its advanced materials sector, which includes construction and interior materials, generated 32 billion won in operating profit, and sales came to 1.79 trillion won.
Lotte Chemical said it will continue its drive for a green transition, with a focus on expanding the business portfolios into secondary battery materials, hydrogen and other eco-friendly products.
Lotte Group unveiled in May last year a plan to invest 37 trillion won over the next five years to advance into bio, mobility and green products, including 7 trillion won for battery component and other advanced materials.
Shares in Lotte Chemical rose 0.58 percent to 174,200 won on the main Seoul bourse Thursday, outperforming the broader KOSPI’s 0.09 percent gain. The earnings results were released after the market closed.
Source: Yonhap News Agency