LG CHEMLG Chem posted a record operating profit of 5 trillion won in 2021, a 178.4% surge from a year earlier. Consolidated sales leapt 42% on-year to a record 42.7 trillion won.
Its Chief Executive Shin Hak-cheol said that the company would more than double its annual sales to 60 trillion won by 2030 from the current 26 trillion won, shifting its focus toward high-value-add products such as battery and eco-friendly materials and new drug development.The sales figures exclude revenues of LG Energy Solution, in which LG Chem holds an 81.84% stake."Half of our sales target for 2030, or 30 trillion won, will be generated from battery materials, eco-friendly materials and drug development," Shin told an online conference call with investors on Tuesday.The projected number is divided into 21 trillion won from battery materials versus last year's 1.7 trillion won; 8 trillion won from eco-friendly materials versus 1.4 trillion won; and 1 trillion won from new drug development.To reach the targets, it will pump more than 4 trillion won every year into the three business segments, including 1 trillion won in R&D. The three segments currently generate about 3 trillion won in combined sales.To fund the investments, LG Chem will utilize the proceeds from the initial public offering of LG Energy Solution last month. LG Energy Solution's EV battery plant in Holland, Michigan BATTERY MATERIALSShin said its battery materials business will produce double-digit operating profit margins down the road. While boosting its global production capacity of cathode materials, LG Chem will also venture into the markets of battery separators and other battery ingredients such as carbon nanotubes and binders used in the anode manufacturing process. "As LG Energy Solution grows further and secures a larger pool of clients, we'll set higher sales targets for battery materials," Shin said.The eco-friendly materials business will deal with recycling and biodegradable and renewable energy materials, with the pharmaceutical division pivoting on anticancer and diabetes treatments and metabolic therapies for global customers. "We'll jump into the blue ocean markets, exploring all growth options, which encompass strategic investments and mergers and acquisitions," Shin added. By Il-Gyu Kim and Kyung-Min Kangkkm1026@hankyung.comYeonhee Kim edited this article2024-09-21 00:48:11