LG Chem Third Quarter Results Miss Estimates, Hit by GM Bolt Recall Cost

11 months ago 126

SEOUL—South Korea’s LG Chem Ltd posted a 20 percent autumn successful quarterly nett connected Monday, wounded by a one-off disbursal associated with the callback of General Motors’ Bolt electrical vehicles.

It reported an operating nett of 727 cardinal won ($617.55 million) for the July-September period, versus 904 cardinal won a twelvemonth earlier and an mean expert forecast of 893 cardinal won compiled by Refinitiv SmartEstimate.

Earlier this month, LG Chem, which owns electrical artillery shaper LG Energy Solution (LGES), said it would instrumentality a complaint nL1N2R8085 of 620 cardinal won successful its 3rd 4th results successful transportation with the GM Bolt callback owed to the hazard of occurrence caused by uncommon artillery defects.

Revenue roseate 41 percent to 10.6 trillion won, LG Chem said successful a regulatory filing.

LG and GM settled a $2 cardinal outgo woody connected the Bolt callback earlier this month, paving the mode for LG’s artillery portion to resume enactment connected its suspended archetypal nationalist offering.

“We expect that it is little apt that the institution would look repetitive large-scale recalls related to artillery information issues successful the future,” LGES Vice President Chang Seung-se said successful a telephone with analysts, citing the company’s improved process to observe defective batteries.

LGES is hoping to a thrust a roar successful soaring artillery demand, arsenic planetary automakers are investing billions of dollars to accelerate a modulation to low-emission mobility and hole for a progressive phase-out of interior combustion engines.

The company, which besides supplies Tesla Inc. and Hyundai Motor Co., struck a woody past week with Stellantis NV to jointly nutrient EV batteries.

Before the 3rd 4th net results announcement, LGES named LG Corp. Vice Chairman Kwon Young Soo arsenic its caller main enforcement officer.

Asked astir LG Chem’s plans to make cheaper lithium-iron-phosphate (LFP) nL4N2PU1IWbatteries for electrical vehicles, the institution said it plans to proviso LFP batteries for vigor retention systems (ESS) first.

Tesla said it plans to follow LFP batteries successful its fleet of standard-range vehicles globally.

LGES has been focusing connected processing nickel-cobalt-manganese (NCM) batteries, which are much costly but connection longer range.

Japan’s Panasonic said connected Monday it had nary nL1N2RL0CKplans to marque LFP batteries for electrical vehicles.

Shares of LG Chem closed up 0.4 percent, versus the KOSPI’s 0.5 percent rise.

($1 = 1,177.2300 won)

By Heekyong Yang and Joyce Lee