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Process Industries

Lotte Chemical Corp.

Company Background

Lotte Chemical is a core unit of Lotte group, the fifth-largest conglomerate in South Korea.

In terms of sales, Lotte Chemical ranks behind only LG Chem in the domestic chemical industry. It is one of the world's largest producers of chemical products such as polyethylene and ethylene.

Lotte Chemical began as Honam Petrochemical, which was established in 1976 through technological collaboration between companies including Japan's Mitsui group. Lotte group acquired the business in 1979. Honam became Lotte Chemical in 2012, when its management was integrated with Kp Chemical.

In South Korea, Lotte Chemical has the world's biggest ethylene capacity. Its plants in Yeosu, South Jeolla Province, and Seosan, South Chungcheong Province, each have 1 million-ton production systems.

The company is also expanding its international presence.

In 2018, it plans to open a joint plant with U.S. company Axiall in the state of Louisiana. The facility is to produce ethylene from shale gas. This stands to boost Lotte Chemical's ethylene capacity to 3.7 million tons.

In 2010, the South Korean company acquired Malaysia's Titan Chemicals, now called Lotte Chemical Titan Holding.

Seeking to reduce its heavy reliance on commodity chemicals, Lotte Chemical intends to reinforce its water treatment business. In addition, it has research-and-development programs focused on large-scale battery products, such as energy storage systems.

Business Summary

Lotte Chemical Corp. is engaged in the manufacture of petrochemicals. It operates through the following businesses: Resin products, Basic petrochemicals and Chemicals. The Resin products business provides polyethylene, polypropylene, polycarbonate and functional resin and polyethylene terephthalate. The Basic petrochemicals business includes ethylene oxide, mono ethylene, di ethylene and tri ethylene glycol, methyl methacrylate, ethanolamine, butadiene and samarium. The Chemicals business offers benzene, toluene and mixed xylene. The company was founded on March 16, 1976 and is headquartered in Seoul, South Korea.

Financial Highlights

Dec 2019 KRWUSD
Revenue15,123.47B12,968.34M
Gross Profit1,878.34B1,610.67M
Operating income1,105.49B947.96M
Income before tax1,063.65B912.07M
Net income816,896.52M700.48M
EBITDA1,837.06B1,575.27M
Diluted EPS20,859.7917.88
Dividends Per Share6,7005.74
Total Assets20,043.10B17,331.57M
Total liabilities5,989.97B5,179.62M
Total equity13,204.39B11,418.04M
Operating cash flow1,408.91B1,208.13M
Currency in KRWCurrency in USD

Historical Data

 Dec 2015Dec 2016Dec 2017Dec 2018Dec 2019
Revenue 11,713.33B 13,223.54B 15,874.51B 16,073.06B 15,123.47B
Gross Profit 2,060.10B 3,249.80B 3,775.37B 2,687.41B 1,878.34B
Operating income 1,611.31B 2,545.61B 2,930.11B 1,946.17B 1,105.49B
Income before tax 1,444.77B 2,415.92B 3,084.68B 2,006.18B 1,063.65B
Net income 992,512.35M 1,835.81B 2,243.87B 1,537.08B 816,896.52M
EBITDA 2,098.98B 3,174.76B 3,621.27B 2,631.21B 1,837.06B
Diluted EPS 29,458 54,488 65,625 46,073.67 20,859.79
Dividends Per Share 2,500 4,000 10,500 10,500 6,700
Total Assets 11,467.80B 15,866.83B 19,550.97B 20,799.13B 20,043.10B
Total liabilities 3,912.22B 6,466.01B 7,296.20B 7,254.81B 5,989.97B
Total equity 7,524.75B 9,363.11B 11,489.62B 12,734.71B 13,204.39B
Operating cash flow 2,601.78B 2,680.54B 3,152.43B 1,503.36B 1,408.91B
 Dec 2015Dec 2016Dec 2017Dec 2018Dec 2019
Revenue 10,349.26M 11,397.74M 14,041.89M 14,604.99M 12,968.34M
Gross Profit 1,820.19M 2,801.09M 3,339.53M 2,441.95M 1,610.67M
Operating income 1,423.66M 2,194.13M 2,591.84M 1,768.41M 947.96M
Income before tax 1,276.52M 2,082.35M 2,728.57M 1,822.94M 912.07M
Net income 876.92M 1,582.33M 1,984.83M 1,396.69M 700.48M
EBITDA 1,854.54M 2,736.41M 3,203.22M 2,390.88M 1,575.27M
Diluted EPS 26.02 46.96 58.04 41.86 17.88
Dividends Per Share 2.20 3.44 9.28 9.54 5.74
Total Assets 9,780.22M 13,136.97M 18,262.54M 18,640.56M 17,331.57M
Total liabilities 3,336.50M 5,353.54M 6,815.37M 6,501.89M 5,179.62M
Total equity 6,417.42M 7,752.20M 10,732.45M 11,413.08M 11,418.04M
Operating cash flow 2,298.79M 2,310.43M 2,788.50M 1,366.05M 1,208.13M

Valuation Measures

Dec 2019
PER10.73
ROA4.00%
ROE6.29%
Operating margin7.30%
Profit margin5.40%

Key executives

  • Co-Chief Executive Officer & Director: Byung-Yeon Lim
  • Co-Chief Executive Officer & Director: Gyo-Hyeon Kim
  • Co-Chief Executive Officer & Director: Dong-Bin Shin
  • Managing Director & Head-Global Operations: Seung-Wook Seo
  • Senior Managing Director & Head-Research: Gyeong-Bo Kang

Shareholders

  • LOTTE Holdings Co., Ltd. (29.2%)
  • Lotte Corp. (24.6%)
  • National Pension Service of Korea (8.7%)
  • Eastspring Investments (Singapore) Ltd. (2.1%)
  • The Vanguard Group, Inc. (1.2%)
  • BlackRock Fund Advisors (1.0%)
  • Norges Bank Investment Management (0.7%)
  • HOTEL LOTTE Co., Ltd. (0.7%)
  • Dimensional Fund Advisors LP (0.7%)
  • JPMorgan Asset Management (UK) Ltd. (0.5%)

Contact Details

  • Website:http://www.lottechem.com
  • Address: 14-16/F, Lotte World Tower, 300 Olympic-ro, Seoul, 05551, South Korea
  • Phone: +82.2.829.4114

Related Companies

  • Lotte Chemical Corp. /Pet Plant/
  • Lotte Chemical Poland Sp zoo
  • LTC Chemical Pty Ltd.
  • Lotte Chemical Alabama Corp.
  • Lotte Chemical Usa Corp.
  • LOTTE Advanced Materials Co., Ltd.
  • LOTTE CHEMICAL (Jiaxing) Corp.
  • Lotte Chemical Trading (Shanghai) Corp.
  • Sambark Co., Ltd.
  • Lotte Chemical Corp. ESOA.
  • Lotte Chemical Titan Holding Berhad

Competitors

  • LyondellBasell Industries NV
  • LG Chem Ltd.
  • Korea Petro Chemical Ind. Co., Ltd.
  • TK Chemical Corporation
  • Hanwha Corp
  • Total SE
  • Indorama Ventures Public Co. Ltd.
  • Formosa Chemicals & Fibre Corporation
  • Sumitomo Chemical Co., Ltd.
  • Hongbaoli Group Corporation Ltd. Class A
  • Covestro AG
  • Hannong Chemicals Inc.
  • Trinseo SA
  • Lion Chemtech Co., Ltd.
  • Zhejiang Jiahua Energy Chemical Industry Co. Ltd. Class A
  • Samyang Corporation
  • Sewoo Global Co., Ltd
Last Updated on 20 Oct, 2020

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