SKC

• Posting 784.6 bn won in 1Q sales/81.8 bn won in operating profits, a 23.6% and 175.4% y-o-y increase, respectively

• Keeping an upward trend as a result of innovation of BM over years, despite it being offseason

• The Company strengthens its ESG management through operation of Financial Advisory Board and innovation of governance structure

SKC (President: Lee Wan-jae) posted 784.6 billion won in sales and 81.8 billion won in operating profits in the first quarter of the year. The operating profits increased by 175.4% y-o-y on the strength of improvement in results in the chemical business and growth in mobility materials. The amount of 81.8 billion won in operating profits is a record quarterly figure, following its adoption of the IFRS (International Financial Reporting Standards) in 2012.

SKC announced its management results for the first quarter of the year at a session held at its HQ building in Jongno-Gu, Seoul on April 30 with the following executive officers in attendance: Mr. Lee Yong-seon, Head of the SKC Industrial Materials Division; President Won Gi-don of SK picglobal; President Kim Yeong-tae of SK nexilis; and President Oh Jun-rok of SKC solmics. The session was relay-broadcasted live through YouTube, as it was last year.

Despite it being an offseason, the Company posted drastic growth, supposedly as a result of innovation of its business model over the past few years and continued the upward trend. As for SK nexilis, investing in copper foil for secondary batteries posted 142.0 billion won in sales and 16.7 billion won in operating profits. Its facilities are operating at full capacity, in step with the growth of the global market for EVs, and it posted a record figure in sales in the first quarter of the year. It plans to enhance its results through earlier completion of the work for its 5^th factory in Jeongeup in the second quarter.

Turning to SK picglobal, a joint venture specializing in chemical business posted 234.1 billion won in sales and 56.0 billion won in operating profits. It posted a good result on the strength of conversion to a high value-added PG-centered portfolio amid the COVID-19 situation and customer businesses’ trust in the stability in supply and product quality. Enhancement of productivity, through periodic repair done last year, focused on the optimization of production processes was another factor for the good result. It is expected that it will post an even better result in the second quarter, amid the global economic recovery.

In the Industrial Materials sector, the Company posted 260.3 billion won in sales and 14.8 billion won in operating profits. The operating profits increased by 21% y-o-y, thanks to an increase in the demand for films with high added value, amid the introduction of new models in IT and mobile early this year, despite a rise in raw material prices. The Company plans to expand the share of materials with high added value, including eco-friendly products, in the second quarter. It plans to increase the supply of eco-friendly PLA biodegradable packing materials, in cooperation with new customer businesses, such as CJ Cheil Jedang and SPC Group.

In the Semiconductor Materials sector, the Company posted 106.2 billion won in sales and 3.9 billion won in operating profits. The increases in both sales and operating profits were on the back of full operation of sales of CMP pad, used for highly particular work processes, and an increase in sales of ceramic parts. The Company expects to accelerate its growth and enhance its profitability through the commencement of commercial operations of the Cheonan factory for CMP pad in the second quarter and completion of the work for the cleaning factory in China in July.

SKC will strengthen its ESG management, in addition to the improvement in results. The Company was announced this year as being the first year for its ESG management, and in March, disclosed a plan for innovation of its governance structure beyond the global level. It plans to launch the ESG/Personnel/Insider Trading Committees in its Board of Directors (“BoD”) and replace the chairs for all the BoD committees, including the Audit Committee, with external directors. The BoD committees are scheduled to start their activities in May.

One noteworthy thing is that the Company is launching the Financial Advisory Board in May as part of its shareholder-friendly policy. The aforementioned Board will focus on enhancement of the Company’s corporate values, with the participation of the following outside experts: Mr. Lee Won-gi, former President of KB Asset Management; Mr. Lee Chae-won, former President of Korea Investment Value Asset Management; and Mr. Lee Nam-u, former General Manager in charge of customer management of the Asia-Pacific Regional HQ of Merrill Lynch, etc.

Commenting on the matter, an SKC official said, “We expect to post another good result in the second quarter, in addition to the record result obtained in the first quarter, which we attribute to the innovation of our business model that we have steadfastly promoted. We will solidify the groundwork for sustainable growth through the strengthening of ESG management this year.”