LG Energy Solutions' operating profit plunged more than 70% in the second quarter. However, the company and the stock market seem to be optimistic about improving their performance in the second half of the year.
LG Energy Solutions announced on the 7th that its provisional sales and operating profit in the second quarter of 2022 were 5.706 trillion won and 1,956 billion won.
Compared to the second quarter of last year, sales decreased by 1.2% and operating profit decreased by 73%. The second-quarter operating profit ratio was 3.9 percent, down 10.3 percentage points from the same period last year (14.1 percent).
LG Energy Solutions explained that the sharp drop in operating profit is due to "one-off factors." This is because the performance in the second quarter of last year reflected KRW 1 trillion received as a settlement for the "battery dispute" lawsuit with SK Innovation (currently SK ON).
This was included in both sales and operating profit. In addition, the cost of recalling batteries for energy storage devices (ESS) (4,000 billion won) was also reflected in the second quarter of last year.
Excluding this, sales in the second quarter of last year are estimated at about 4.1,000 trillion won and operating profit at 2,500 billion won. Market watchers predict that its performance will improve significantly from the second half of the year.
This is because the range of selling price linkage of major materials for secondary batteries such as lithium, nickel, cobalt, manganese, and aluminum has recently expanded, and sales of cylindrical batteries are increasing.
Reporter Lee Ji-sun stockmk2020@infostock.co.kr