LG Electronics, first quarter sales and operating profit record high… Home appliances, TV boom (total)

LG Electronics[066570]In the first quarter of this year, the company achieved the best performance ever thanks to strong sales of premium products such as Objet Collection and OLED TV.

LG Electronics announced on the 28th that it recorded 21.11 trillion won in sales and 1.80.5 trillion won in operating profit in the first quarter of this year on a consolidated basis.

Sales and operating profit increased by 18.5% and 6.4%, respectively, compared to the first quarter of last year, both of which are record highs.

This is higher than analysts’ expectations (sales of KRW 20 trillion and operating profit of KRW 1.3 trillion).

Sales in the first quarter were more than 100 billion won more than the previous high of 4Q last year (21.86 trillion won), and the operating profit also surpassed the previous high of 1.76 trillion won in the first quarter of last year.

The strong performance despite external uncertainties such as the prolonged Corona 19 and the rise in the price of raw materials due to the Russian invasion of Ukraine and increased logistics costs is attributed to the increase in sales of premium products such as the ‘Space Interior Appliances’ Objet Collection and OLED TV.

By business division, the H&A division, which is in charge of home appliances, recorded sales of 7.97 trillion won and operating profit of 447.6 billion won, respectively.

Sales of premium products such as LG Objet Collection, new home appliances, and steam appliances increased by 18.8% compared to the same period last year, posting the highest quarterly performance ever.

According to LG Electronics, sales increased evenly in all regions of the world, especially by region, and showed a sharp growth centering on North America and Europe.

However, the final operating profit decreased from the first quarter of last year as non-recurring expenses (human structure renewal cost) were reflected in the business division’s earnings.

The HE business division, which is in charge of the TV business, posted sales of KRW 4.649 trillion and broke the KRW 4 trillion mark for the past six consecutive quarters. This is thanks to the steady popularity of OLED TVs and extra-large TVs despite the global TV market stagnation. Operating profit was 188.4 billion won.

The VS (automobile electronics) business division recorded sales of 1.87 trillion won and operating loss of 6.3 billion won in the first quarter.

Sales increased by 8.5% from the first quarter of last year, as sales of infotainment, electric vehicle powertrain, and vehicle lighting systems all increased as a result of preemptively responding to issues of supply and demand for automotive semiconductors.

The BS business headquarters, which operates B2B business, accepted the report card of KRW 2.16.7 trillion in sales and KRW 37 billion in operating profit.

Sales reached a quarterly record high, and as demand for electronic information (IT) products increased and the B2B market gradually began to recover, quarterly sales exceeded KRW 2 trillion for the first time.

LG Electronics said, “As the cost of restructuring the company’s human resources in the first quarter of this year was reflected in the performance of each business division, the operating profit of each division decreased from the same period last year. It had a positive impact on profits.”

LG Electronics did not disclose the amount of patent revenue due to the confidentiality clause in the contract, but it is estimated to be in the hundreds of billions of won.

Regarding the outlook for the business environment in the second quarter of this year, LG Electronics predicted, “As uncertainties such as geopolitical issues, inflation concerns, exchange rate fluctuations, and supply chain risks continue, cost increases such as raw material prices and logistics costs will increase, making it more difficult.” did.

LG Electronics continued, “Even in this situation, we will put customer value first and focus on securing solid profitability by further enhancing the intrinsic competitiveness of our business.”

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