Kumho Petrochemical to overcome economic slowdown with strategic agility

Kumho Petrochemical's second rubber production facility in Yeosu, South Jeolla Province / Courtesy of Kumho Petrochemical

Kumho Petrochemical plans to adopt the business concept of strategic agility, which involves insights, agility and flexibility, as its operational strategy in order to continue to generate stable profits this year, company officials said Friday.

The company will maintain its solid business structure based on its strategic plan focusing on Core, Base and Growth principles revealed in 2022.

Core: Will focus on strengthening the market dominance of solid synthetic rubber and latex products for tires.

Base: Will focus on diversifying the sales regions of its synthetic resin business and expand high-value-added products.

Growth: Will focus on securing the competitiveness of its carbon nanotube products.

Kumho Petrochemical's subsidiary Kumho P&B Chemicals will continue to promote its Hydrogenated Bisphenol A (HBPA) business as a joint venture with its mother company. The company aims to solidify its position in the global market by constructing an additional plant to produce 60,000 tons of epoxy resin by the fourth quarter of this year.

Another subsidiary Kumho Mitsui Chemicals will invest in expanding its facility for the production of 20,000 tons of Methylene Diphenyl Diisocyanate (MDI) using eco-friendly technology. The technology recycles raw materials made from by-products and wastewater reduced with chlorine and hydrogen.

Kumho Polychem, which succeeded in rebounding with its performance based on profits coming from its EPDM business, plans to expand to 70,000 tons of EPDM being produced from its facility by 2024. EPDM refers to a type of synthetic rubber that is used in many applications.

“Kumho Petrochemical is currently minimizing potential risk by closely reviewing investment priorities and strengthening investment plans according to its cash flow, supply and demand of raw materials as well as market demand fluctuations,” a company official said.

The company's consolidated debt ratio improved from 72.6 percent at the end of 2019 to 59.7 percent at the end of 2021. (Advertorial)