By Kim Yoo-chul
LG Chem said Friday that its operating profit jumped 56 percent from a quarter earlier to 361 billion won in the first quarter of the year.
It said it benefited from declines in key raw materials for chemical products, increased sales of its premium products and favorable currency moves.
In a filing to the Korea Exchange (KRX), the nation's biggest chemical company reported 246 billion won in net profit, up 125 percent from the fourth quarter.
However, its sales fell 8.5 percent to 4.91 trillion won. It announced the quarterly results after the stock market closed.
Operating profit dropped 0.1 percent from a year earlier, with sales down 13.4 percent and net profit down 14 percent.
The company was positive about its earnings outlook in the coming quarters.
"Increased sales of our premium products and a decline in raw material price benefited us, offsetting impacts of increased maintenance costs and lengthy holidays in China," said C.S. Song, head of the company's public relations office.
Its electric materials division helped the company strengthen the bottom line thanks to solid demand for its film patterned retarder (FPR) products to be used in 3D televisions and other electronic applications.
Also, the company's battery division generated more profits as it received stronger demand for small-sized batteries for high-end smartphones and tablets by leading Chinese phone makers.
But the company said high rise in spending for car batteries for electric vehicles and energy storage systems limited its profit curve.
The company expects to report better profits in the second quarter as its business divisions will benefit the most because of seasonal factors.
Usually, chemical and technology companies report their best quarterly report during the April-June period of each year as client order more ahead of big shopping seasons in fall and winter.
"This year will be much better than a year ago in terms of sales and profits," said Song.