COMPANY PROFILE

2018. 07

BUSINESS

PORTFOLIO

SUSTAINABLE

GROWTH

COMPANY

INFORMATION

CONTENTS

COMPANY

INFORMATION

Overview

Company History

Overview

General Overview Business Sites

Corporate Name

CEO

Date of Establishment

Headquarter

Industrial Classification

Employees

Homepage

LOTTE Fine Chemical Co., Ltd.

Hong-Yul Lee

August 27, 1964

19, Yeochoenro No.217 beon-gil,

Namgu, Ulsan

Manufacturing of Chemicals

820 persons (As of Dec. 2017)

www.lottefinechem.com

Europe GmbH,

Europe T/S center

LOTTE Fine Chemical

Trading(Shanghai) Co., Ltd.

Seoul Office Incheon Plant

Ulsan Complex

Vision

Global Leader

in Fine Chemicals

Foster

Qualitative Growth

& Enhance

Profitability

Complete

Capacity

Expansion

on Schedule

Pursue

Operational

Excellence

Vision Strategic Direction BUSINESS POLICY

Lead the industry

based on qualitative growth

Overview

2014 2015 2016 2017

Sales 1,210.5 1,161.9 1,110.7 1,159.5

Operating

Profit -24.4 2.6 29.8 111.1

Net Income 58.7 88.3 -43.5 89.2

(※ The financial information is subject to K-IFRS )

1,431.2 1,333.6

2011 2012 2013

1,314.1

2014

1,201.5

2015

1,161.9 2014 2015 2016 2017

Assets 1,846.0 16,842 15,310 16,413

(Cash &

cash equivalent) 97.1 2,193 210.1 131.7

Liabilities 650.2 520.6 419.3 448.6

(Debt) 429.9 317.1 301.4 281.0

Equities 1,195.8 1,163.6 1,111.7 1,192.7

(Shares, mil.) 25.8 25.8 25.8 25.8

Net Debt 319.0 97.8 91.3 149.3

Net Debt/Equity (%) 26.7 8.4 8.2 37.6

ROE (%) 4.9 7.6 -3.9 7.5

CAPEX 101.4 171.4 36.3 63.1

2016

1,110.7

Sales overview (bn. KRW)

Income statement (bn. KRW)

Balance sheet (bn. KRW)

1,159.5

2017

Overview

Area FY16 YoY FY17

Chloride relatives 364.4 6.5% 388.2

Cellulose relatives 261.9 7.3% 280.9

Ammonia relatives 385.6 0.2% 386.5

Electronic materials 98.8 5.2% 103.9

Total 1,110.7 4.4% 1,159.5

Area FY16 YoY FY17

Sales 1,110.7 4.4% 1,159.5

Gross Profit 162.8 29.1% 210.2

(%) 14.7% 4.3%p 18.1%

Operating

Profit 29.7 274.1% 111.1

(%) 2.7% 7.3%p 9.6%

Income

Before Tax -50.4 N.A. 110.7

(%) -4.5% N.A. 9.5%

Net Income -43.5 N.A. 89.2

FY 2017 Performance (bn. KRW) Sales by Area (bn. KRW)

Sales Portion by Area (FY2017)

Electronic materials

9.0% Chloride relatives

33.5%

Cellulose relatives

24.2%

Ammonia relatives

33.3%

History

1964~1979

The Asia largest

urea fertilizer

manufacturer

1964 Founded as

Korea Fertilizer

1967 Nationalized

1976 IPO

1980 MA / DMF

1994 Changed name to

Samsung Fine Chemicals

1994 MECELLOSE®

1995 TMAC

1999 ECH/ Caustic soda

2000 AnyCoat®

2001 PTAC

2010 Polymerized Toner

2011 HECELLOSE®

2012 MECELLOSE® expansion

AnyCoat® expansion

Polymerized Toner expansion

2013 ECH, Caustic Soda expansion

2014 Europe Branch & T/S center

launched

2015. 10 Announcement of

acquisition by LOTTE Group

Diversify into

chemical

businesses

Strengthening

Specialty

Chemicals 1980~1999

Taking-off of

LOTTE Fine Chemical

2016. 02

2016. 02 Changed name to

‘LOTTE Fine Chemical’

2017. 04 Announcement of

expansion of HECELLOSE®

“ Through the synergy with affiliates of LOTTE Group,

LFC will achieve sustainable growth ”

2000~2015

BUSINESS

PORTFOLIO

Cellulose relatives

Chloride relatives

Ammonia relatives

Electronic materials

Cellulose Relatives

MECELLOSE®

MECELLOSE® is a water-soluble

macromolecule product that

performs specific functions

such as thickening, moisturizing,

lubricating, and stabilizing.

HECELLOSE®

AnyCoat®

AnyAddy®

AnyCoat® is a high functional

product used in coating and as

a capsule raw material for

medicine which enhances

medicine delivery with

characteristics such as

viscosity, water solubility,

and water-holding capacity.

AnyAddy® improves

food texture using viscosity,

water solubility, and

maintainability.

HECELLOSE ® is added to paints

and health care products

including shampoo and body

lotion. And it is a water-soluble

polymer product that increases

functions such as thickening

and moisturizing.

Chlorine Relatives

ECH

Key material in the epoxy resins used in

paint for construction, shipbuilding,

electronics.

Widely used in chemical Industrial

applications such as metal cleaning,

surfactant, water treatment industries.

Caustic soda Used as paper strengthening agent,

surfactant and additives for textile.

PTAC

Ammonia Relatives

DMA Ammonia

A raw material for various chemical products

such as fertilizer and caprolactam for nylon. EUROX®

A brand developed independently by LFC,

EUROX ® is a urea solution used as a

reductant to reduce nitrogen oxide in SCR

devices for diesel vehicles, vessels, and

industrial purposes.

Dimethylamine (DMA) has been used as a

herbicide and pesticide, surfactants,

flocculants in water and wastewater

treatment.

Electronic materials

TMAC

Core material of developing solutions

for semiconductors and LCDs.

Chemically Polymerized Toner for color laser printer

suitable for high resolution and high-speed printing.

Polymerized toner

SUSTAINABLE

GROWTH

Safety Management

Environmental Management

Human Resource Management

Corporate Social Responsibility

Safety Management

Set up PSM safety culture

VISION

Chemical substance

management system

Align strategy and implementation

Improve safety and environment infrastructure

Strict compliance with laws

Embodying

Safety and Health

A Workplace with

No Accident, No Pollution, No Disease

· Managing chemicals

through system

· Responding to chemical

substance regulation

· Renewing chemical

handing facilities

· Establishing safety

culture

· Supporting business

partners’ safety system

Green company Certificate

Safety & health Management system certificate

Environmental Management

Response to climate change

Eco friendly activities

Air pollution

Management

Water quality

Management

Waste

Management

Hazardous Chemical Management

Secure energy-cost competitiveness

Respond to GHG regulation Improve power efficiency Improve energy structure

Energy efficiency↑, GHG emissions↓

Human Resource Management

Human Resource Development

· Education by Job & Position

· Acquisition of job qualifications

· Tech Academy

· Language education

Cooperative Labor Culture

Welfare and benefit Communication Culture

· Hi-Five safety Movement

· Labor-Management

cooperation programs

· Medical expense support system

· Family-friendly company certificate

· Flexible work system

· Maternity supporting system

· CEO open meeting

· On-line communication channel

· Multi-purpose lounge

01 02

03 04

CSR

Dreamy future Happy family Warm companion

Clean environment

01 02 03

04

LFC supports future generations by expanding our contribution activities

linked to the local communities targeting children and adolescents.

LFC finds ways to grow with local communities based on mutual growth activities with

small business owners.

LFC carries out local environmental improvement activities to respect and preserve

the natural environment.

Suporting Multicultural families

Baking services for elders

Multicultural orchestra

Little Baseball club ‘SWINGS’

Supporting whale festivals,

Kimchi sharing,

Winter goods donation program

Urban box gardening campaign, Bamboo protection campaign

LFC supports the happiness and well-being of families through

various social contribution activities targeting families and women.

APPENDIX

Ownership structure

Business Sites

Corporate Links

Ownership structure

Shares outstanding 25,800,000

Paid-in capital (KRW, bn.) 129.0

Share price (KRW) (2017) 64,900

Market cap (KRW, bn.) 1,674.4

LOTTE Chemical 31.1%

National Pension 12.1%

Hermes Investment 6.3%

Etc. 50.5%

Total 100.0%

Share information

Major Shareholders (as of Dec. 2017)

LOTTE Chemical 31.1%

Foreign investors 21.2%

Individual investors 23.3%

Domestic Institutions 23.2%

Treasury stock 1.3%

Business Sites

LOTTE Fine Chemical Trading(Shanghai) Co., Ltd.

Europe GmbH

Ober der Roeth 4, D-65824 Schwalbach/Ts. Germany

Europe T/S Center

Rm1515, Shanghai Int’l Trading Center No 2201,

Yan An Road(W), Shanghai, P.R.China. 200336

C/O Technologie- und Innovationszentrum Giessen GmbH

Winchesterstrasse 2, 35394 Giessen, Germany

Ulsan Complex

Seoul Office

19 Yeochonro, 217 beon-gil, Nam-gu, Ulsan, South Korea

Incheon Plant

26F, 27F, Glasstower Bldg.,

534 Teheran-ro, Gangnam-gu, Seoul, South Korea

47, Namdongdaero 79 beon-gil, Namdong-gu,

Incheon South Korea

Corporate links

Homepage

Facebook

Blog

TEL

LFC Links Brand Links

Seoul ofiice 02) 6974-4500

Ulsan complex 052) 270-6114

http://www.lottefinechem.com

https://www.facebook.com/lottefinechem

http://www.finelfc.com/

http://www.lotte-cellulose.com

http://www.eurox.co.kr

High functional cellulose products

Additive for construction, MECELLOSE

Additive for paint, HECELLOSE

Capsule coating material

for medicine, AnyCoat

Food additive, AnyAddy

Eco-friendly products

Nitrogen oxide reducer,

EUROX