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• Annual Revenue 2024: KRW20.4304 trillion, up 2.4% YoY.

• Annual Operating Loss 2024: KRW894.8 billion.

• Q4 2024 Revenue: KRW4.8961 trillion, down 5.8% QoQ.

• Q4 2024 Operating Loss: KRW234.8 billion.

• Q4 2024 Net Loss: KRW1.1206 trillion.

• Q4 2024 Assets: KRW34.6246 trillion, up KRW137.6 billion QoQ.

• Q4 2024 Cash and Cash Equivalents: KRW3.4757 trillion, down KRW146.4 billion QoQ.

• Q4 2024 Liabilities: KRW14.579 trillion, down KRW248.8 billion QoQ.

• Q4 2024 Borrowings: KRW10.4054 trillion, down KRW317.1 billion QoQ.

• Debt to Equity Ratio: 72.7%, stable at 70% level.

• Q4 2024 Shareholders' Equity: KRW20.456 trillion, up KRW386.3 billion QoQ.

• Basic Chemicals Q4 2024 Sales: KRW3.78 trillion.

• Basic Chemicals Q4 2024 Operating Loss: KRW175 billion.

• Advanced Materials Q4 2024 Sales: KRW1.944 trillion.

• Advanced Materials Q4 2024 Operating Profit: KRW29.7 billion, operating margin of 2.7%.

• LOTTE Fine Chemicals Q4 2024 Sales: KRW428.6 billion.

• LOTTE Fine Chemicals Q4 2024 Operating Income: KRW12.2 billion, operating margin of 2.8%.

• LOTTE Energy Materials Q4 2024 Sales: KRW186.4 billion.

• LOTTE Energy Materials Q4 2024 Operating Loss: KRW40.1 billion.

• Warning! GuruFocus has detected 8 Warning Signs with XKRX:011170.

Release Date: February 07, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Lotte Chemical Corp (XKRX:011170) reported a 2.4% year-over-year increase in revenue for 2024, reaching KRW20.4304 trillion.

• The company successfully eliminated one-off costs from Q3, leading to a lower operating loss in Q4 and a turnaround to profit in EBITDA.

• Lotte Fine Chemicals, a subsidiary, showed improved revenue and profitability quarter-over-quarter due to higher international prices and expanded sales volumes of chlorine and ammonia-based products.

• The company's debt-to-equity ratio decreased quarter-over-quarter, maintaining a stable level of around 70%.

• Lotte Chemical Corp plans to invest KRW1 trillion less year-over-year in 2025, focusing on maintaining financial soundness and investing within EBITDA levels.

Negative Points

• Lotte Chemical Corp experienced an operating loss of KRW894.8 billion in 2024, with a net loss of KRW1.1206 trillion in Q4.

• The petrochemical industry faced a delayed recovery due to global economic slowdown and overcapacity, impacting the company's profitability.

• The company recognized a significant impairment loss of around KRW1 trillion in Q4, mainly from LOTTE Energy Materials and Basic Chemical businesses.

• Despite efforts to improve financial soundness, the company's debt-to-equity ratio increased year-over-year.

• Market uncertainties and structural changes, particularly in China, continue to pose challenges for the petrochemical industry, affecting Lotte Chemical Corp's recovery timeline.