LG Electronics reports strong 4Q09
LG Electronics (LG) reported record revenues and operating profits for the fourth quarter of 2009. Full-year 2009 also showed strong revenue growth and record operating profits.
Sales on a global basis (including LG's overseas subsidiaries) for the fourth quarter ending December 31, 2009 rose 6.8% to 14.3 trillion won (US$12.2 billion) on year, according to the company. Operating profit increased to 446.7 billion won, resulting in a margin of 3.1%, 2.3 percentage points higher than the fourth quarter last year.
Full-year 2009 sales on a global basis went up 12.5% to a company record level of 55.5 trillion won with operating profit reaching 2.9 trillion won. Consolidated sales including subsidiaries rose 15.3% on year to 73 trillion won. Consolidated operating profit reached 4.2 trillion won for a margin of 5.8%.
The LG Home Entertainment Company saw fourth-quarter sales rise by 18% to 5.9 trillion won, returning an operating profit of 271.6 billion won for a margin of 4.6%, 5.2 percentage points higher than the previous year, as a result of rising demand for LCD TVs and plasma TVs, the company said.
Unit sales of total flat panel TVs jumped 52% on year to 6.6 million sets in the fourth quarter from 4.3 million. On-quarter unit growth was also seen in both LCD TVs and plasma TVs, 38% and 29% respectively.
Annual sales reached 19.6 trillion won, up 19.9% from the previous year, mainly led by record unit sales of 19.5 million flat panel TVs. On the whole, profitability increased due to higher sales and more aggressive cost management, it said.
The LG Mobile Communications Company reported sales of 4.2 trillion won, 7.4% lower than fourth-quarter 2009. Operating profit of 55.8 billion won in the 2009 period resulted in a margin of 1.3%.
Handset revenues were 3.9 trillion won, a 5% decline from the same quarter in 2008, while operating profit reached 66.5 billion won, resulting in a margin of 1.7%.
Unit shipments of handsets saw an increase of 32% on year and 7% on quarter to 33.9 million units, which resulted in a record 117.9 million units being sold in 2009 versus 100.7 million units in 2008 due to robust growth in North America, Europe and emerging markets, LG said.
Price erosion and an increase in marketing expenses for year-end inventory clearance and emerging market channel expansion resulted in lower profitability compared to the third quarter. Yearly sales for the Mobile Communications Company increased 13.5% to 18.2 trillion won, with the handset division alone seeing an increase of 17.3% on year to 17.1 trillion won.
Market demand is expected to rise in 2010 as the global economy begins to emerge from the recession, LG said. On a global basis, LG Electronics expects sales growth - especially from LCD TVs on a US-dollar base - as a result of conversion to digital TV in developed markets and increased demand due to World Cup soccer and Olympic Games in 2010.
LG's mobile communications business is targeting a 19% increase in unit sales to 140 million in 2010, focusing on the exploding smartphone category and differentiation in content and services. Solar-cell, LED lighting and new solutions businesses in automotive and commercial areas represent new business engines expected to increase revenues.
Sales on a global basis (including LG's overseas subsidiaries) for the fourth quarter ending December 31, 2009 rose 6.8% to 14.3 trillion won (US$12.2 billion) on year, according to the company. Operating profit increased to 446.7 billion won, resulting in a margin of 3.1%, 2.3 percentage points higher than the fourth quarter last year.
Full-year 2009 sales on a global basis went up 12.5% to a company record level of 55.5 trillion won with operating profit reaching 2.9 trillion won. Consolidated sales including subsidiaries rose 15.3% on year to 73 trillion won. Consolidated operating profit reached 4.2 trillion won for a margin of 5.8%.
The LG Home Entertainment Company saw fourth-quarter sales rise by 18% to 5.9 trillion won, returning an operating profit of 271.6 billion won for a margin of 4.6%, 5.2 percentage points higher than the previous year, as a result of rising demand for LCD TVs and plasma TVs, the company said.
Unit sales of total flat panel TVs jumped 52% on year to 6.6 million sets in the fourth quarter from 4.3 million. On-quarter unit growth was also seen in both LCD TVs and plasma TVs, 38% and 29% respectively.
Annual sales reached 19.6 trillion won, up 19.9% from the previous year, mainly led by record unit sales of 19.5 million flat panel TVs. On the whole, profitability increased due to higher sales and more aggressive cost management, it said.
The LG Mobile Communications Company reported sales of 4.2 trillion won, 7.4% lower than fourth-quarter 2009. Operating profit of 55.8 billion won in the 2009 period resulted in a margin of 1.3%.
Handset revenues were 3.9 trillion won, a 5% decline from the same quarter in 2008, while operating profit reached 66.5 billion won, resulting in a margin of 1.7%.
Unit shipments of handsets saw an increase of 32% on year and 7% on quarter to 33.9 million units, which resulted in a record 117.9 million units being sold in 2009 versus 100.7 million units in 2008 due to robust growth in North America, Europe and emerging markets, LG said.
Price erosion and an increase in marketing expenses for year-end inventory clearance and emerging market channel expansion resulted in lower profitability compared to the third quarter. Yearly sales for the Mobile Communications Company increased 13.5% to 18.2 trillion won, with the handset division alone seeing an increase of 17.3% on year to 17.1 trillion won.
Market demand is expected to rise in 2010 as the global economy begins to emerge from the recession, LG said. On a global basis, LG Electronics expects sales growth - especially from LCD TVs on a US-dollar base - as a result of conversion to digital TV in developed markets and increased demand due to World Cup soccer and Olympic Games in 2010.
LG's mobile communications business is targeting a 19% increase in unit sales to 140 million in 2010, focusing on the exploding smartphone category and differentiation in content and services. Solar-cell, LED lighting and new solutions businesses in automotive and commercial areas represent new business engines expected to increase revenues.
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