South Korea’s chemical and high tech material company SKC Co. sold off some of its money-losing solar business operation to local rival Woonging Energy for 3 billion won ($2.7 million) to clean up ailing business for restructuring.

SKC solmics Co. which primarily manufactures components for liquid crystal display and semiconductor announced on Tuesday that it was selling some of its solar power facilities to Woongjin Energy Co.

The company has been losing money in the solar energy business it ventured into in 2011 due to glut in local market. The company would be eventually pulling out of the business and instead concentrate on its core manufacturing of fine ceramics for LCD and chips.

The offloading of ailing sector would likely boost outlook for SKC that fared relatively poorly this year despite booming chemical business.

While its local rivals LG Chem and Lotte Chemical reported best-ever earnings in the first half, the company’s operating profit sank 25 percent to 85.3 billion won while sales fell 12 percent to 1.15 trillion won compared with the same period last year.

Film business that takes up half of its revenue caused the setback due to slump in the panel sector.

In the chemical sector, the company remains a winner as an exclusive supplier of propylene oxide (PO), a material of polystyrene, in the country. The business recorded 18 percent in operating profit margin in the first half of this year. The film business posted 400 million won in operating loss in the first half alone.

The company is more hopeful down the road due to cost-saving restructuring efforts and improving film business.

It also would benefit from better performance of its affiliates and offloading of money-losing solar business. SK telesys has been making profit since last year after struggling from 2011. SK bioland Co., that came under SKC in 2014 has been performing well in the Chinese bio and beauty care market.

By Chung Wook

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]