LG Profit Surges In Q1
LG Electronics has posted 2016 first-quarter operating profit of 505.2 billion Korean won (around $580.2 million), up 65.5 per cent year-on-year, with sales of 13.36 trillion won down 4.5 per cent.
LG’s home appliance & air solution division contributed the largest amount in operating income for the quarter, recording 407.8 billion won, while its mobile communications division posted an operating loss of 202.2 billion won.
LG noted that the loss was primarily due to marketing expenditures for its new LG G5 flagship smartphone.
Amid its ongoing rollout, LG G5 sales will be included in LG’s second-quarter results.
LG advised that it shipped 13.5 million smartphones for the quarter, down 12 per cent year-on-year, which it stated was “mainly as a result of the business entering the slow season as well as declining shipments of existing flagship models due to high interest in the recently announced LG G5”.
“Competition in the smartphone market will continue to increase, leading to further price erosion, which LG plans to counter with a strong global push for the modular LG G5 smartphone and new mass-tier models such as its X series,” LG stated.
The LG home entertainment division, meanwhile, posted 335.2 billion won in operating profit.
“LG’s overall global sales and profitability are expected to improve in the second quarter, with double-digit growth in revenues and higher profitability anticipated as LG continues its premium-focused strategy with LG Signature products, the LG G5 smartphone and 4K ultra-HD OLED TVs,” LG stated.