Kumho Petrochemical announces new vision for future growth

Kumho Petrochemical plant in Yeosu, South Jeolla Province/ Courtesy of Kumho Petrochemical

Kumho Petrochemical has managed to weather the impact of the coronavirus pandemic and achieved better-than-expected profits. The refiner aims to go beyond the conventional petrochemical sector and increase its proportion of high value-added products to diversify its product portfolio and become more competitive in a changing market.

Operating profit more than doubled last year to 740 billion won compared to 2019. Since 2010, Kumho Petrochemical has steadily reduced its debt ratio to enhance its financial status. In 2009, the refiner's debt ratio was 660 percent, but has since been drastically reduced reaching 73 percent by 2019, and has remained below 100 percent since then. As a result, Kumho Petrochemical saw its credit rating rise from BBB- to A0 during the past three years.

The refiner has also been diversifying its business portfolio. In 2012, higher value-added products accounted for 20 percent of its product line-up, but that ratio surged to 50 percent by 2020.

Kumho Petrochemical is the world's largest producer of NB latex materials that are widely used to manufacture rubber gloves for medical and laboratory use.

Currently, the refiner's NB latex products are unrivaled, accounting for over a 30-percent global market share.

Kumho Petrochemical expanded its annual NB latex output capacity by 60,000 tons in 2020, bringing the total to 630,000 tons. It aims to raise output capacity to 700,000 tons this year.

The refiner plans to boost the profitability and market shares of its core businesses such as NB latex, epoxy and SSBR through 2025. Kumho Petrochemical said it plans to diversify the applications of its bread-and-butter synthetic resin business to meet new demands.

Additionally, the company is seeking M&A opportunities to expedite growth in the global market especially in the carbon nanotube, engineering plastic and eco-friendly insulator sectors that have grown at least 7 percent annually. Through the acquisitions, the company aims to create synergy in future businesses. (advertorial)