Lotte Group is accelerating efforts to improve its financial structure through better performance in core businesses and a portfolio reshuffle. It is also ramping up nurturing of new businesses such as bio and secondary battery materials.
Lotte Corporation said on the 28th that it held an investor relations (IR) session on the 27th to share its first-quarter results and portfolio upgrade strategy. About 30 people, including securities firm analysts and institutional investors, attended the event, and finance and IR executives from major affiliates such as Lotte Corporation, Lotte Shopping, Lotte Construction, and Lotte Chemical were also present.
Lotte stressed that profitability improvements in its core business groups—food, retail, chemicals, and hotels—have begun in earnest. In the first quarter, operating profit from the group's core business groups came to 787.6 billion won, up 181% from a year earlier.
Lotte Shopping posted operating profit of 252.9 billion won, up 71%, as major domestic and overseas stores, led by department stores, showed solid growth. During the same period, Lotte Construction's operating profit jumped 1,226% to 50.4 billion won, and Lotte Wellfood and Hotel Lotte reported operating profit of 35.8 billion won, up 118%, and 74.5 billion won, up 83%, respectively.
Lotte Chemical returned to the black for the first time in 10 quarters. The company said improved spreads due to the impact of the Middle East war, a positive lagging effect, and optimized plant operations contributed.
It also disclosed the status of its portfolio reshuffle centered on streamlining noncore businesses and assets. The company secured liquidity by pushing efficiency measures for noncore, low-profit businesses through the sale of Lotte Wellfood's Jeungpyeong plant, Lotte Chemical's Pakistan subsidiary (LCPL), and Lotte Eco Wall, and through consolidation and closure of Lotte Chilsung Beverage branches. This year, it plans to proceed with the sale of Lotte Rental and the business reshuffle of Lotte Chemical's Daesan and Yeosu plants.
It also introduced strategies for investing in and fostering new businesses. Lotte Biologics plans to fully roll out its "dual-site" strategy in the second half of this year after completing Plant 1 at the domestic Songdo campus, linking the Syracuse plant in the United States with Incheon Songdo.
Lotte Energy Materials is shifting its business focus from copper foil for electric vehicles (EVs) to copper-clad laminates for energy storage system (ESS) batteries and circuit foils for artificial intelligence (AI). Lotte Chemical is pursuing a portfolio transition by expanding the share of high-value specialty materials.
Lotte said it explained the status of reducing contingent debt related to Lotte Construction's project financing (PF) and plans for efficient investment execution within earnings before interest, taxes, depreciation and amortization (EBITDA), adding it would focus on financial soundness and enhancing corporations value.