Lotte Chemical Corp.

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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 2021	KRW	USD
Revenue	18,120.46B	15,823.52M
Gross Profit	2,427.71B	2,119.97M
Operating income	1,535.64B	1,340.98M
Income before tax	1,521.55B	1,328.68M
Net income	1,345.65B	1,175.08M
EBITDA	2,368.37B	2,068.16M
Diluted EPS	39,260.04	34.28
Dividends Per Share	8,300	7.24
Total Assets	22,869.96B	19,238.66M
Total liabilities	7,418.76B	6,240.81M
Total equity	14,410.21B	12,122.15M
Operating cash flow	1,535.20B	1,340.60M
	Currency in KRW	Currency in USD

Historical Data

KRW | USD

	Dec 2017	Dec 2018	Dec 2019	Dec 2020	Dec 2021
Revenue	15,874.51B	16,073.06B	15,123.47B	12,223.03B	18,120.46B
Gross Profit	3,775.37B	2,687.41B	1,878.34B	1,113.80B	2,427.71B
Operating income	2,930.11B	1,946.17B	1,105.49B	357,071.86M	1,535.64B
Income before tax	3,084.68B	2,006.18B	1,063.65B	178,695.37M	1,521.55B
Net income	2,243.87B	1,537.08B	816,896.52M	158,468.91M	1,345.65B
EBITDA	3,621.27B	2,631.21B	1,837.06B	1,187.96B	2,368.37B
Diluted EPS	65,625	46,073.67	20,859.79	4,623.39	39,260.04
Dividends Per Share	10,500	10,500	6,700	3,600	8,300
Total Assets	19,550.97B	20,799.13B	20,043.10B	19,386.54B	22,869.96B
Total liabilities	7,296.20B	7,254.81B	5,989.97B	5,674.19B	7,418.76B
Total equity	11,489.62B	12,734.71B	13,204.39B	12,846.51B	14,410.21B
Operating cash flow	3,152.43B	1,503.36B	1,408.91B	1,377.44B	1,535.20B

	Dec 2017	Dec 2018	Dec 2019	Dec 2020	Dec 2021
Revenue	14,041.89M	14,604.99M	12,968.34M	10,359.48M	15,823.52M
Gross Profit	3,339.53M	2,441.95M	1,610.67M	943.99M	2,119.97M
Operating income	2,591.84M	1,768.41M	947.96M	302.63M	1,340.98M
Income before tax	2,728.57M	1,822.94M	912.07M	151.45M	1,328.68M
Net income	1,984.83M	1,396.69M	700.48M	134.30M	1,175.08M
EBITDA	3,203.22M	2,390.88M	1,575.27M	1,006.84M	2,068.16M
Diluted EPS	58.04	41.86	17.88	3.91	34.28
Dividends Per Share	9.28	9.54	5.74	3.05	7.24
Total Assets	18,262.54M	18,640.56M	17,331.57M	17,846.40M	19,238.66M
Total liabilities	6,815.37M	6,501.89M	5,179.62M	5,223.41M	6,240.81M
Total equity	10,732.45M	11,413.08M	11,418.04M	11,825.93M	12,122.15M
Operating cash flow	2,788.50M	1,366.05M	1,208.13M	1,167.43M	1,340.60M

Valuation Measures

Dec 2021
PER	5.52
ROA	6.36%
ROE	9.87%
Operating margin	8.47%
Profit margin	7.42%

Key executives

Chairman & Co-Chief Executive Officer: Dong-Bin Shin
Co-Chief Executive Officer & Director: Young-jun Lee
Co-Chief Executive Officer & Director: Jin-Koo Hwang
Co-Chief Executive Officer & Director: Kyo-Hyeon Kim
Senior Managing Director & Head-Research: Gyeong-Bo Kang

Shareholders

Lotte Holdings Co., Ltd. (29.2%)
Lotte Corp. (25.5%)
National Pension Service of Korea (7.7%)
The Vanguard Group, Inc. (1.1%)
BlackRock Fund Advisors (1.0%)
Invesco Asset Management Ltd. (0.6%)
Dimensional Fund Advisors LP (0.5%)
Samsung Asset Management Co., Ltd. (0.4%)
Eastspring Investments (Singapore) Ltd. (0.3%)
Norges Bank Investment Management (0.3%)

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

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Competitors

LG Chem Ltd.
TotalEnergies SE
Korea Petro Chemical Ind. Co., Ltd.
LyondellBasell Industries NV
Hanwha Corp
TK Chemical Corporation
Formosa Chemicals & Fibre Corporation
Sumitomo Chemical Co., Ltd.
Trinseo Public Limited Company
Covestro AG
Indorama Ventures Public Co. Ltd.
Zhejiang Jiahua Energy Chemical Industry Co. Ltd. Class A
Formosa Plastics Corporation
Samyang Corporation
Sewoo Global Co., Ltd
Lion Chemtech Co., Ltd.
OCI Co., Ltd

Last Updated on 4 Oct, 2022