LG rings in spectacular results

In late January 2013, Korea-based LG Electronics Inc. (LG) announced consolidated revenues of $ 45.2 billion and a net profit of $ 80.7 million for full-year 2012.

Despite a 6 per cent revenue decrease from 2011, operating profits increased significantly in 2012 to $1.01 billion from $342 million in full-year 2011.

Fourth quarter 2012 consolidated revenues were $12.3 billion with an operating profit of $98 million.

The LG Home Entertainment Company reported record sales of flat-panel TVs with 9.3 million units in the fourth quarter resulting in a 17.4 per cent revenue increase quarter-on-quarter to $5.9 billion and full-year operating profit of $480 million.

Revenues from 3D and Smart TVs increased with higher unit sales in the United States, Europe and CIS countries. Although the Home Entertainment Company had the strongest quarter of the year in terms of revenue, profitability declined somewhat due to lower average selling prices and increased competition.

LG will continue to aggressively market 3D and Smart TVs and plans to expand its share of the premium TV segment in 2013 with Ultra HD TVs and OLED TVs.

The LG Mobile Communications Company reported a 7 per cent unit increase quarter-on-quarter in mobile handset shipments to 15.4 million with more than half of the units coming from smartphones.

Smartphone shipments grew 23 per cent compared to the previous quarter, increasing to 8.6 million devices from the 7 million in the third quarter.

Fourth quarter revenues were the highest of the year, growing 15 per cent to $2.5 billion quarter-on-quarter. Sales of premium LTE smartphones such as Optimus G and Vu:2 increased in the fourth quarter, as did the L-series and Google Nexus 4.

With more European and emerging markets introducing LTE services this year, LG plans to increase smartphone revenues and market share by launching follow-up devices to Optimus G and the L-series as well as the new F-series.

The LG Home Appliance Company posted almost flat revenues year-on-year, with sales of $2.7 billion in the fourth quarter as strong sales in the U.S. and CIS countries were largely offset by sluggish demand in Europe, the Middle East and Latin America. Profitability was affected by unfavorable foreign exchange rates and increased marketing investments, even though average selling prices for home appliance products rose in the fourth quarter. The company plans to improve its revenue and profitability in 2013 with more competitive products, advanced technologies and a stronger focus on profitable regions.

The LG Air Conditioning & Energy Solutions Company reported sales of $626 million in the fourth quarter, essentially unchanged year-on-year. For full-year 2012, the company recorded revenues of $3.8 billion and operating profit of $138.4 million. The priority in 2013 will be to introduce more energy-efficient and localised products to bolster revenue growth.

For 2013, LG Electronics is targeting a revenue goal of $47.4 billion with plans to spend $2.2 billion on capital expenditures.