Hyosung Chemical records $23 mln Q1 loss in Vietnam

Hyosung Chemical, the chemical arm under South Korea’s multi-sector business Hyosung, recorded a loss of KRW30.1 billion ($22.86 million) from its Vietnam operation in the first quarter of this year.

The result was an improvement from a loss of KRW42 billion ($31.9 million) and KRW40.6 billion ($30.8 million) in Q4/2022 and Q1/2022, respectively, according to Hyosung Chemical's financial statements.

With the outcomes, the operating loss margin reached 18.5% in Q1/2023, versus 30% in Q1/2022 and 25.3% in Q4/2022.

The firm posted a sales revenue of KRW162.6 billion ($123.5 million) in Q1/2023, lower than KRW166 billion ($126.1 million) in Q4/2022 but higher than KRW135.5 billion ($102.9 million) in Q1/2022.

The firm expects the dehydrogenation unit would soon reach normalization, stable production, and better output following the completion of its revamp process.

Regarding overall performance in Q1/2023, Hyosung Chemical recorded a continued net loss of KRW82.3 billion ($62.5 million), while its sales revenue fell 7.9% year-on-year to KRW669.5 billion ($508.5 million).

In a filing to the Korea Exchange (KRX) stock market on Monday, Hyosung Chemical said it would invest $120 million in its Vietnam subsidiary Hyosung Vina Chemicals Co., Ltd. The move aims to ameliorate the financial status of the Vietnamese business, Hyosung noted.

Hyosung Vina Chemicals made a net loss of KRW313.7 billion ($238.27 million) in 2022.

Hyosung Vina Chemicals was established in Vietnam's southern coastal province of Ba Ria-Vung Tau in 2018, manufacturing polypropylene, a key material for the plastics industry, with the propane dehydrogenation (DH) process.

Its first polypropylene factory entered operation in March 2020. Its second plant and an underground LPG storage facility, with an investment of $1.3 billion, entered trial operation in September 2021.