LG Electronics reports 87.8% net profit increase in Q3
LG Electronics reported an 87.8 percent increase in net profit in the third quarter to 649.2 billion won ($573 million) on demand for TVs and home appliances from people social distancing at home.
The company’s operating profit was 959 billion won, a 22.7 percent on-year increase. Sales were 16.9 trillion won, up 7.8 percent from the same period last year.
Compared to the previous quarter, the company’s net profit increased by 889.6 percent, operating profit by 93.6 percent and sales by 31.8 percent.
Home appliances helped drive results.
The total operating profit for LG’s home appliances and air solution business was 671.5 billion won. Sales reached 6.16 trillion won, which was the highest quarterly figure for the company in history. The accumulated operating profit surpassed 2 trillion won — a first for the company.
LG’s home entertainment division generated 326.6 billion won in operating profits and 3.67 trillion won in sales. The company said premium TV products, such as the OLED TV, sold well in the United States and Europe.
Sales of LG’s vehicle components solutions and smartphones were 1.66 trillion won and 1.52 trillion won, respectively. While sales from the two divisions were lower than others, the company said it increased profitability by reducing costs in these areas.
LG plans to expand its selection of budget 5G smartphones in the North and Central American regions. The product category has driven sales increases in LG smartphones in the third quarter.
Sales in its business solution division, which produces solar panels and information displays, totaled 1.48 trillion won, and operating profit fell 2.2 percentage points on year to 77 billion won.
The company plans to strengthen its online sales channels and focus on its home appliances and TVs in the next quarter.
“Following the contactless trend, we believe there will be new business opportunities as people’s spending habits change accordingly,” said LG Electronics in its statement.
“We will turn this crisis into an opportunity and focus on strengthening our brand’s presence in the global markets.”
BY KANG JAE-EUN [email@example.com]