LG Chem (051910) Q1 2025 earnings summary

Executive summary

• Q1 2025 consolidated sales reached KRW 12,171 billion, with operating profit rebounding to KRW 447 billion (3.7% OPM) and net profit of KRW 260 billion, recovering from prior losses.

• EBITDA improved to KRW 1,733 billion (14.2% margin), and gross profit margin rose to 16.8%.

• Profitability improved quarter-over-quarter due to cost-cutting and increased sales of high-value-added products.

• Strategic focus remains on operational optimization, business restructuring, and developing new growth drivers.

• LG Energy Solution contributed 51.5% of sales, followed by petrochemicals (38.5%), advanced materials (5.8%), and life sciences (2.3%).

Financial highlights

• Consolidated Q1 sales were KRW 12,171 billion, with operating profit of KRW 447 billion (OP margin 3.7%) and net profit of KRW 260 billion.

• Gross profit margin was 16.8%; EBITDA reached KRW 1,733 billion.

• Cash and equivalents at quarter-end were KRW 7.3 trillion.

• Assets stood at KRW 95,100 billion, liabilities at KRW 47,000 billion, and capital at KRW 48,100 billion.

• Debt ratio increased to 97.7% quarter-over-quarter.

Outlook and guidance

• Expect continued volatility due to global economic slowdown, tariff changes, and demand reshoring.

• Petrochemical profitability is expected to improve gradually in Q2 due to lower raw material prices and seasonal demand, but supply-demand balance recovery remains uncertain.

• Advanced Materials faces demand uncertainty and potential shipment volume reduction in Q2 due to U.S. tariff policy changes.

• Life Sciences will prioritize oncology drug development, maintain R&D investments, and continue global clinical trials.

• Energy Solution anticipates continued demand uncertainty from external volatility and conservative OEM inventory strategies.