OCI returns to profit in Q2 with 43.3 billion won operating income

OCI, a South Korean chemical company, has reported a significant improvement in its second-quarter financial performance, achieving an operating profit of 43.3 billion won. This marks a return to profitability compared to the same period last year, driven by expanded sales of petrochemical products and a stronger showing in its semiconductor materials division.

The Basic Chemical division, which includes semiconductor materials, posted sales of 209.5 billion won and an operating profit of 18.1 billion won. This growth was attributed to price increases for certain products, the normalization of production following scheduled maintenance, and a recovery in demand. The company noted that sales of chlor-alkali (CA) and toluene diisocyanate (TDI) increased, with TDI prices also rising due to supply disruptions in the Middle East.

OCI anticipates further improvement in its semiconductor materials segment, driven by increased sales of polysilicon for semiconductors and higher operating rates for key products like hydrogen peroxide. However, the company forecasts a downward stabilization of TDI prices in the third quarter due to easing geopolitical uncertainties and seasonal factors. The Carbon Chemical division recorded sales of 331.5 billion won and an operating profit of 31 billion won, supported by widening spreads for benzene, toluene, and xylene (BTX) products due to rising oil prices.

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The improvement in market conditions for basic chemical products and the growth of the semiconductor materials business have led to continued profit growth in the second quarter.

Looking ahead, OCI is strategically expanding its semiconductor materials business. The company is entering the wafer regeneration sector, aiming to leverage the production infrastructure of OCI Specialty, which it is in the process of acquiring. This move is intended to reduce investment costs and accelerate commercialization, with related facilities targeted for completion in the first half of 2027. OCI believes the growing demand for wafers, fueled by AI proliferation and advanced packaging technologies, along with customer needs for cost reduction, will drive the regeneration market.

Furthermore, OCI has completed an expansion of its conductive carbon black production capacity, adding 30,000 tons annually. This material is used in ultra-high voltage cables, and OCI expects increased demand driven by the expansion of AI data centers and investments in renewable energy, which necessitate robust power grid infrastructure. OCI Vice Chairman Kim Yoo-shin expressed confidence in continued profit growth, emphasizing the company's commitment to enhancing its business portfolio through investments in high-value-added materials like wafer regeneration and conductive carbon black.

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We will expand investments in high-value-added materials such as wafer regeneration and conductive carbon black to enhance our business portfolio.