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Process Industries

LG Chem Ltd.

Company Background

LG Chem is a leading chemical company in South Korea. Its origins can be traced back to Lucky Chemical Industrial, founded in 1947, of the LG group. LG Chem started as a producer of materials for cosmetics and has grown to become the pillar of the LG group, surpassing LG Electronics in terms of both market capitalization and earnings.

The LG group has shifted to a holding company system and LG Chem's biggest shareholder is LG Corp. While LG Chem is managed by a top executive who has risen within the company, key decisions such as changes in the top management and large acquisition deals are considered by LG Corp. Chairman Koo Bon-moo, owner and manager of the group.

LG Chem chalks up the majority of its sales from the petrochemical division, which has ethylene plants and produces products such as superabsorbent polymers used to make paper diapers and sanitary goods.

The lithium-ion battery business is also drawing attention as a locomotive of LG Chem's growth. The company supplies batteries for electric cars and hybrids to many automakers in the U.S., Europe and China, including Daimler of Germany and Great Wall Motor. It also engages in joint battery development. In addition, LG Chem handles electronic components such as polarizers for liquid crystal display panels.

Business Summary

LG Chem Ltd. manufactures petrochemicals, IT & electronic materials and energy solution materials. It operates through through the following business segments: Petrochemicals, IT & Electronic Materials, Batteries. The Petrochemical division offers naphtha cracking centers and polyolefins, synthetic rubbers and specialty polymers, polyvinyl chloride, acrylonitrile-butadiene-styrene and engineering plastics, acrylates and plasticizers. The IT & Electronic Material division provides optical and display materials namely polarizers, phosphors, organic light emitting diode, photosensitive materials for liquid crystal display; printed circuit materials such as flexible materials, halogen free materials, integrated circuit packaging materials, epoxy resin system materials, high speed materials and build-up materials; toners such as color toners, black laser printer toners and black copier toners. The Battery division provides lithium-ion cylindrical batteries, lithium-ion polymer batteries, lithium-ion prismatic batteries, medium and large batteries. The company was founded in January 1947 and is headquartered in Seoul, South Korea.

Financial Highlights

Dec 2019 KRWUSD
Revenue28,625.04B24,545.89M
Gross Profit4,577.93B3,925.56M
Operating income895,648M768.01M
Income before tax538,349M461.63M
Net income313,365M268.70M
EBITDA2,752.11B2,359.93M
Diluted EPS3,887.053.33
Dividends Per Share2,0001.71
Total Assets34,024.42B29,421.44M
Total liabilities16,640.63B14,389.41M
Total equity17,004.97B14,704.46M
Operating cash flow3,121.10B2,676.33M
Currency in KRWCurrency in USD

Historical Data

 Dec 2015Dec 2016Dec 2017Dec 2018Dec 2019
Revenue 20,206.58B 20,659.29B 25,698.01B 28,183.01B 28,625.04B
Gross Profit 3,609.35B 3,937.73B 5,455.48B 5,144.42B 4,577.93B
Operating income 1,823.56B 1,991.92B 2,928.45B 2,246.07B 895,648M
Income before tax 1,549.64B 1,659.82B 2,563.89B 1,940.04B 538,349M
Net income 1,152.98B 1,281.12B 1,945.28B 1,472.60B 313,365M
EBITDA 3,079.65B 3,328.61B 4,334.08B 3,733.33B 2,752.11B
Diluted EPS 15,679 17,422 25,391.08 19,061.98 3,887.05
Dividends Per Share 4,500 5,000 6,000 6,000 2,000
Total Assets 18,578.72B 20,487.06B 25,041.22B 28,944.13B 34,024.42B
Total liabilities 5,475.20B 6,436.09B 8,702.64B 11,622.00B 16,640.63B
Total equity 12,991.46B 13,937.35B 16,168.52B 17,083.04B 17,004.97B
Operating cash flow 3,171.58B 2,518.10B 3,182.86B 2,124.96B 3,121.10B
 Dec 2015Dec 2016Dec 2017Dec 2018Dec 2019
Revenue 17,853.43M 17,806.82M 22,731.34M 25,608.86M 24,545.89M
Gross Profit 3,189.03M 3,394.04M 4,825.68M 4,674.54M 3,925.56M
Operating income 1,611.20M 1,716.89M 2,590.38M 2,040.92M 768.01M
Income before tax 1,369.18M 1,430.65M 2,267.90M 1,762.84M 461.63M
Net income 1,018.71M 1,104.23M 1,720.70M 1,338.10M 268.70M
EBITDA 2,721.01M 2,869.02M 3,833.73M 3,392.34M 2,359.93M
Diluted EPS 13.85 15.01 22.45 17.32 3.33
Dividends Per Share 3.97 4.30 5.30 5.45 1.71
Total Assets 15,844.72M 16,962.29M 23,390.98M 25,940.25M 29,421.44M
Total liabilities 4,669.48M 5,328.77M 8,129.13M 10,415.85M 14,389.41M
Total equity 11,079.66M 11,539.45M 15,103.00M 15,310.13M 14,704.46M
Operating cash flow 2,802.23M 2,170.42M 2,815.42M 1,930.88M 2,676.33M

Valuation Measures

Dec 2019
PER77.62
ROA0.99%
ROE1.83%
Operating margin3.12%
Profit margin1.09%

Key executives

  • Vice Chairman & Chief Executive Officer: Hak Cheol Shin
  • President: Okdong Son
  • Director, Chief Operating & Financial Officer: Ho-Young Jeong
  • CTO & President-Executive Board: Ki-Soo No
  • Managing Director: Hyang-Mok Lee

Shareholders

  • LG Corp. (33.3%)
  • National Pension Service of Korea (10.1%)
  • LG Chem Ltd. (2.3%)
  • The Vanguard Group, Inc. (1.8%)
  • Fidelity Management & Research Co. LLC (1.7%)
  • BlackRock Fund Advisors (1.5%)
  • Norges Bank Investment Management (1.1%)
  • Samsung Asset Management Co., Ltd. (1.0%)
  • Aberdeen Asset Managers Ltd. (0.8%)
  • Schroder Investment Management Ltd. (0.7%)

Contact Details

  • Website:http://www.lgchem.com
  • Address: LG Twin Tower, 128 Yeoui-daero, Seoul, 07336, South Korea
  • Phone: +82.2.3777.1114

Related Companies

  • LG Chem Wroclaw Energy Sp zoo
  • LG Chem Ltd. /Photoresist Business/
  • LG Chem Ltd. /Pesticide Bus/
  • LG Chemical Tianjin Plant
  • Daejung Em Co., Ltd. /Cathode Material Bus/
  • LG Hausys Ltd. /Adhesive Film Div/
  • Nanjing LG Chem New Energy Battery Co. Ltd.
  • Ugimag Korea Co., Ltd.
  • Tianjin LG BOTIAN Chemical Co. Ltd.
  • LG Polycarbonate Ltd.
  • LG Chem Display Materials (Beijing) Co. Ltd.
  • Wuxi LG Chemical Co. Ltd.
  • LG Chem Ltd. (Japan)
  • LG Chemical (Guangzhou) Engineering Plastics Co. Ltd
  • LG Chem (Tianjin) Engineering Plastics Co. Ltd.
  • LG Chem HK Ltd.
  • Tianjin LG Bohai Chemical Co. Ltd.
  • LG Chem (Taiwan) Ltd.
  • LG Chem Poland SP zoo
  • LG-Dow Polycarbonate Ltd.
  • Ningbo LG Yongxing Chemical Co. Ltd.
  • LG Solar Energy, Inc.
  • LG Chem Trading Shanghai Co. Ltd.
  • LG Polymers India Pvt Ltd.
  • LG Chem Michigan, Inc.
  • Kolon Industries, Inc. /Super Absorbent Polymer Ops/
  • LG Chem America, Inc.
  • Uniseal, Inc.
  • Hyundai Petrochemical Corp.
  • LG Life Sciences, Ltd

Competitors

  • BASF SE
  • Mitsubishi Chemical Holdings Corporation
  • DuPont de Nemours, Inc.
  • Dow, Inc.
  • Saudi Basic Industries Corp.
  • LyondellBasell Industries NV
  • Asahi Kasei Corporation
  • Linde plc
  • Air Liquide SA
  • OCI Co., Ltd
  • Hansol Chemical Co., Ltd
  • Genexine, Inc.
  • Eastman Chemical Company
  • OMNOVA Solutions Inc.
  • Johnson Matthey Plc
  • Aekyung Petrochemical Co., Ltd.
  • AK Holdings, Inc.
  • Formosa Chemicals & Fibre Corporation
  • Hana Pharm Co., Ltd.
  • SHIN HEUNG ENERGY & ELECTRONICS Co., Ltd.
  • Trinseo SA
  • Lotte Chemical Corp.
  • Oil Refineries Ltd.
  • PanGen Biotech, Inc.
  • CHENG MEI MATERIALS TECHNOLOGY CORPORATION
  • Ecopro BM Co., Ltd.
  • Electrovaya Inc.
  • CBAK Energy Technology, Inc.
  • Shandong Ruifeng Chemical Co., Ltd. Class A
  • USI Corporation
Last Updated on 27 Mar, 2020

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