Lotte Chemical Corporation (011170) Q2 2025 earnings summary

Executive summary

• Q2 2025 consolidated sales were KRW 4.197 trillion, with an operating loss of KRW 244.9 billion and net loss of KRW 471.3 billion, impacted by scheduled plant turnarounds and external uncertainties.

• Revenue for 2Q25 was ₩41,971 billion, down 12.4% sequentially and 17.5% year-over-year, reflecting challenging market conditions.

• Revenue for H1 2025 was KRW 8.99 trillion, with a net loss of KRW 717.6 billion, reflecting continued margin pressure and challenging market conditions.

• Losses widened quarter-over-quarter due to one-off factors, including turnaround costs and exchange rate fluctuations.

• Management expects gradual recovery in Q3 as negative one-off factors are removed, though external uncertainties persist.

Financial highlights

• EBITDA for Q2 was KRW 48.3 billion.

• EBITDA for 2Q25 was ₩1,653 billion, up from ₩1,170 billion in 1Q25, but down from ₩1,964 billion in 2Q24.

• H1 2025 revenue: KRW 8.99 trillion, down from KRW 19.89 trillion in FY2024.

• Pre-tax loss stood at KRW 501.7 billion, with non-operating expenses driven by exchange rate fluctuations.

• Cash and cash equivalents: KRW 9.05 trillion as of June 2025.

Outlook and guidance

• Q3 is expected to show gradual improvement as one-off negative factors subside, but global economic slowdown and weak demand will continue to pose challenges.

• Basic chemicals segment expects improved spreads in 3Q25 due to removal of one-off factors and stabilized raw material prices, despite ongoing uncertainty.

• The company targets continued cost optimization and portfolio transformation, focusing on specialty and battery materials.

• Expansion in hydrogen and recycled PET businesses is expected to support future growth.

• Interim dividend of KRW 500 per share declared to maintain shareholder return policy.