[Alpha Biz=(Chicago) Reporter Kim Jisun] Lotte Chemical announced on the 8th that its consolidated operating loss in the second quarter of this year was 77 billion won, an increase in deficit compared to the same period last year.

It is the fifth consecutive quarter of deficit since the second quarter of last year. The quarterly deficit also rose sharply from 26.2 billion won in the first quarter.

Sales fell 5.9 percent year-on-year to 5.24 trillion won during the same period. The net loss turned to a deficit of 140.3 billion won. "The deficit increased due to a drop in selling prices due to sluggish demand for petrochemical products, resulting in an increase in inventory valuations and the effect of backloading of uner materials (time lag in the input of raw materials)," said a representative for Lotte Chemical.

By sector, the basic material business recorded sales of 2.7557 trillion won and operating loss of 82.8 billion won. In particular, as oil prices fell since early May, the price of naphtha, a major raw material, fell from $688 in the first quarter to $600 in the second quarter. The loss caused by the reverse logging effect is 90 billion won in the basic materials business and 22 billion won in its subsidiary Lotte Chemical Titan, the company explained.

Sales from the high-tech materials business were 1.98 trillion won and operating profit was 75.1 billion won. Profitability improved by expanding sales in high-yield regions, improving product spread (margin) and stabilizing transportation costs. Lotte Chemical Titan's sales and operating losses were 543.7 billion won and 111.6 billion won, respectively. LC USA, a US subsidiary, had sales of 149.8 billion won and operating losses of 7.8 billion won.

 

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