LG hits Ksh1.8T global Q1 profit
LG Electronics Inc. (LG) today announced first-quarter 2021 consolidated sales of USD 16.90 billion (Ksh. 1.8 trillion) and operating profit of USD 1.36 billion (Ksh. 145 billion) – the highest quarterly results in the company’s history.
At 8.1 percent, this is a first-quarter operating profit record for the global consumer electronics giant, reflecting strong demand for LG home appliances and home entertainment products as customers around the world continue to spend more time at home due to Covid-19 lockdowns.
Compared to Quarter 1 a year ago, revenues grew 27.7 percent and profitability soared 39.1 percent. The LG Home Appliance & Air Solution Company generated first-quarter sales of USD 6.03 billion (Ksh. 645.2 billion), an increase of 23.8 percent from the previous year. Operating profit at USD 826.39 million (Ksh. 88 billion) was 22.1 percent higher than the first quarter 2020.
For the second consecutive quarter the appliance business division saw significant growth year-on-year in North America and Europe as well as in its home market of South Korea where the rental business is particularly healthy. Profitability was accompanied by stable growth led by strong sales of premium products in North America and Europe. The business unit expects to see continued growth by expanding sale of new products overseas.
The LG Home Entertainment Company recorded sales of USD 3.60 billion (Ksh. 385.2 Billion) in the first quarter, an increase of 34.9 percent from the same period last year. Operating income rose 23.9 percent year-on-year to USD 362.75 million (Ksh. 38 Billion), buoyed by strong sales in North America and Europe. Premium products led by OLED and NanoCell TVs continued to experience strong demand as the pandemic effect continued to be felt across the world.
To maintain this success in 2021, LG plans to enhance its premium product lineup, expand online sales, optimize resources and streamline asset management.
The LG Mobile Communications Company reported sales in the first quarter of USD 897.18 million (Ksh. 95.9 Billion) with an operating loss of USD 251.63 million (Ksh. 26.9 Billion). Operating loss was down 28 percent compared to the same period last year due to the lack of new products with LG’s planned exit from the smartphone business at the end of July this year.
The LG Vehicle Component Solutions Company achieved first-quarter sales of USD 1.70 billion (Ksh. 181 Billion, an increase of 43.5 percent from the same period last year. Operating loss narrowed attributable to the recovery of the automotive sector in North America and Europe, as well as increased revenues from new projects in the e-Powertrain and infotainment sectors and better cost management.
The LG Business Solutions Company also saw improved first-quarter revenues of USD 1.67 billion (Ksh. 178 Billion), an increase of 9.1 percent from a year ago and 23.6 percent higher than the previous quarter largely on the back of strong demand for products such as monitors and PC products in the era of remote working and online learning. Operating profit of USD 120.38 million (Ksh. 12.8 billion) declined due to increasing cost of components such as LCD panels and semiconductors.
LG Electronics will hold a Korean / English conference call on April 29, 2021 at 16:00 Korea Standard Time (07:00 GMT/UTC). Conference call participants are instructed to pre-register online to receive a private PIN number then call +82 31 810 3130 and enter passcode 6418# and the private PIN number. The audio webcast of the call will be available for streaming as well. The corresponding presentation file can be downloaded from the LG Electronics website before the call.