Battery maker LG Energy Solution sees 422% jump in profit in Q2

LG Chem posted its second quarter performance to date in the second quarter of 2021.

This was thanks to its battery subsidiary LG Energy Solution posting four times the operating profit from a year ago, and strong performance of LG Chem’s petrochemical business.

LG Chem said on Thursday that it recorded 11.45 trillion won in revenue and 1.32 trillion won in operating income, an increase of 57.7% and 207%, respectively, from a year ago.

LG Energy Solution contributed 5.13 trillion won in revenue and 815.2 billion won in operating income.

This was a surge of 81.7% and 422%, respectively, from a year ago.

LG Chem said the battery subsidiary saw increased sales for cylinder batteries for electric vehicles. Revenue also increased by 1 trillion won thanks to a one-time payment made by SK Innovation as part of the pair’s settlement over their trade secret lawsuit.

But revenue also dropped 400 billion won from the cost of its battery recall in the US over faulty energy storage systems. 

LG Energy Solution’s revenue is expected to increase further in the second half but there was also uncertainty due to the shortage in automobile components. The business had 180 trillion won worth of remaining orders for batteries, company executives said at the conference call for the second quarter.

Meanwhile LG Chem’s advanced material business, which sells petrochemical products, recorded 1.29 trillion won in revenue and 94.5 billion won in operating income, a rise of 63.9% and 137.5%, respectively, from a year ago.