S Korea's LG Chem Q1 profit falls 42% on weaker petchem margins

19 April 2012 09:10  [Source: ICIS news]

SINGAPORE (ICIS)--South Korea’s LG Chem on Thursday reported a 42% year-on-year fall in net profit to won (W) 380.9bn ($334.4m) in the first quarter of this year partly because of weaker margins at its petrochemicals unit.

The company’s overall sales rose by 4.8% year on year to W5,753bn in the first quarter, while its operating profit fell by 45% to W495.5bn, it said.

Strong raw material costs and a decline in product prices because of sluggish demand from China squeezed margins at the firm’s petrochemicals unit during the first quarter, LG Chem said.

Revenue contributions from its information technology (IT) and electronic materials business slipped slightly amid weak demand from the IT industry, the company said.

Looking ahead, LG Chem said its earnings are expected to gradually improve in the second quarter of 2012 on the back of stable naphtha prices and strong seasonal demand.

($1 = W1,138.57)

By: Nurluqman Suratman

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