Lotte Chemical’s profit plunges 75% in 3QCY24

Despite higher revenue, Lotte Chemical Pakistan Limited (LOTCHEM), a subsidiary of South Korean chemical giant Lotte Chemical Corporation (LCC), saw its profit-after-tax (PAT) plunge by 75%, clocking in at Rs494.94 million for the quarter ending September 30, 2024 compared to PAT of Rs1.99 billion in same period of the previous year (SPPY).

The profit decline is attributed to a rise in the cost of sales.

The Board of Directors (BoD) of the listed company in a meeting held on Friday reviewed the company’s financial performance for the period ended on September 30, 2024.

As per the latest financials, the company’s earnings per share (EPS) stood at Re0.33 per share in 3QCY24, against Rs1.31 per share in SPLY.

LOTCHEM’s net revenue increased by over 4% to Rs24.6 billion in 3QCY24, as compared to Rs23.6 billion recorded in the previous year.

Lotte Chemical’s profit plunges 50% in 2023

However, despite higher revenues, the company’s gross profit stood at Rs1.04 billion in 3QCY24, as compared to Rs3.41 billion in SPPY, a drop of over 69%. The drop in profit comes on account of increase in cost of sales, which jumped by 17% year-on-year in 3QCY24.

Resultantly, LOTCHEM’s profit margin reduced to 4.2% in 3QCY24, in comparison to 14.5% in 3QCY23.

During the period, the company’s administrative expenses increased by 22%, reaching Rs190.6 million in 3QCY24, compared to Rs156.2 million in SPLY.

On the other hand, LOTCHEM’s other income stood at Rs274.7 million in 3QCY24, down by 61% compared to Rs700.5 million in SPPY.

Consequently, the company’s registered a profit before tax of Rs819.1 million in 3QCY24, as compared to Rs3.21 billion in SPPY, a fall of nearly 75%.

During the period, the chemical maker paid taxes to the tune of Rs324 million, as compared to Rs1.23 billion in SPPY.

Lotte Chemical Pakistan Limited was incorporated in Pakistan on 30 May 1998 under the Companies Ordinance, 1984. The principal activity of the Company is to manufacture and sale of Pure Terephthalic Acid (PTA).