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Tesla supplier LG Chem swings to Q4 operating profit, predicts gains from battery business in 2021

SEOUL — South Korea’s LG Chem Ltd. swung to an working income in the fourth...

SEOUL — South Korea’s LG Chem Ltd. swung to an working income in the fourth quarter of 2020 and the supplier expects surging revenue from its battery device that materials Tesla Inc. to set the stage for a potent 2021.

The maker of chemical compounds and batteries, whose battery device LG Electrical power Remedy materials Tesla, posted an working income of 674 billion won ($610.twenty million) — in comparison with a loss of 33 billion won in the very same interval a 12 months earlier.

With the launches of new EVs and improved orders for its electrical power storage procedure batteries, LG Electrical power Remedy expects revenue to grow much more than 50 % in 2021 from a 12 months earlier, aiming to ramp up annual capability to one hundred fifty five gigawatt-several hours of batteries by the of the 12 months, up about thirty % from a 12 months earlier, the unit’s Senior Vice President Chang Seung-se stated in a phone with analysts.

LG Chem’s total fourth-quarter revenue rose twenty % to 8.9 trillion won, the business stated in a regulatory submitting. LGg Electrical power Remedy, which was split off on Dec. 1, reported a fourth-quarter income of 116 billion won soon after a loss a 12 months earlier with the unit’s revenue up much more than sixty six % from a 12 months earlier.

Fourth-quarter earnings were being impacted as resources were being set aside to include the prices of two battery recalls, LG Chem Vice President Yoon Hyun-seok stated on the analyst phone without having the volume.

These contain the recall of Hyundai Motor Co.’s Kona EV, which employs LG Electrical power Remedy batteries, as effectively as a recall of LG Electrical power Solution’s household electrical power storage batteries in the U.S.

LG Chem saw potent desire for its EV batteries final 12 months. That assisted the battery small business swing to a income for the to start with time in the April to June quarter backed by world wide automakers’ change from the combustion motor to electrical autos to comply with environmental restrictions.