LG Electronics’ operating profit jumps over 33% in Q3
LG Electronics said on Friday that its third-quarter operating profit jumped more than 33 per cent on brisk sales of new-platform services and automotive electronics, beating market expectations.
The company said in a regulatory filing that operating income for the July-September period came to 996.7 billion won ($738.2 million) on a consolidated basis, up 33.5 percent from 746.6 billion won a year ago.
The operating profit was 24.9 percent higher than the average estimate, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.
Net profit also soared 44.2 percent to 485.2 billion won. But sales dropped 2.2 percent to 20.7 billion won.
Shares of LG Electronics fell 3.51 per cent on Friday.
LG Electronics said its business-to-business segments, including automotive electronics and air solutions businesses, led the strong bottomline, which accounted for more than 30 percent of its sales.
Its new platform-based service business that links high-end home appliances and content subscription services also contributed to the strong operating profit, it added.
LG Electronics’ home appliance business logged quarterly sales of 7.46 trillion won, with an operating profit of 504.5 billion won.
The company earned 3.57 trillion won in sales and 110.7 billion won in operating profit from its TV business.
Its vehicle components business, one of LG Electronics’ future growth drivers, posted a record 134.9 billion won in operating profit, with sales of 2.5 trillion won.
The segment for automotive electronics, such as in-vehicle infotainment systems, is expected to post an annual sales figure of 10 trillion won by the end of this year and become the company’s flagship business, the company added.
LG said it will focus on improving its business structure by expanding its business-to-business (B2B) segment and non-hardware business areas in the fourth quarter.
“We plan to expand sales of our key products to meet rising demand in the peak season at the end of the year, and expect our automotive electronics business will lead brisk sales of our B2B business,” the company said in a statement.