LG ANNOUNCES FIRST-QUARTER 2021 FINANCIAL RESULTS
Highest Quarterly Revenue and Operating Profit in Company’s History
LG Electronics Inc. (LG) announced first-quarter 2021 consolidated sales of KRW 18.81 trillion (USD 16.90 billion) and operating profit of KRW 1.52 trillion (USD 1.36 billion) – the highest quarterly results in the company’s history with the 8.1 percent operating profit being a first-quarter record. Compared with the first quarter a year ago, revenues grew by 27.7 percent and profitability soared by 39.1 percent, reflecting very strong demand for LG home appliances and home entertainment products as consumers around the world continue to spend more time at home.
The LG Home Appliance & Air Solution Company generated first-quarter sales of KRW 6.71 trillion (USD 6.03 billion), an increase of 23.8 percent from the previous year. Operating profit of KRW 919.90 billion (USD 826.39 million) was 22.1 percent higher than the first quarter last year. For the second consecutive quarter the appliance busi-ness division saw significant growth year-on-year in North America and Europe as well as in its home market of South Korea where the rental business is particularly healthy. Profitability was accompanied by stable growth led by strong sales of premium prod-ucts in North America and Europe. The business unit expects to see continued growth by expanding overseas sales in new products.
The LG Home Entertainment Company recorded sales of KRW 4.01 trillion (USD 3.60 billion) in the first quarter, an increase of 34.9 percent from the same period a year ago. Operating income grew 23.9 percent year-on-year to KRW 403.80 billion (USD 362.75 million), buoyed by strong sales in North America and Europe. Premium products led by OLED and NanoCell TVs continued to experience strong demand as the pandemic effect continued in most of the world. To maintain this success in 2021, LG will con-tinue to enhance its premium product lineup, further expand online sales, optimize re-sources and streamline asset management.
The LG Mobile Communications Company reported sales in the first quarter of KRW 998.70 billion (USD 897.18 million) with an operating loss of KRW 280.10 billion (USD 251.63 million). Operating loss deteriorated 28 percent from the same quarter a year ago due to the lack of new products in light of the public announcement earlier this month that LG will exit the smartphone business at the end of July. Profit and loss for discontinued operations – including a breakdown of continuing and discontinued operations – will be included in the second quarter results.
The LG Vehicle component Solutions Company achieved first-quarter sales of KRW 1.89 trillion (USD 1.70 billion), an increase of 43.5 percent from the same period last year. Operating loss narrowed to KRW 700 million (USD 629,000), which can be at-tributed to the recovery of the automotive sector in North America and Europe as well as increased revenues from new projects in the e-Powertrain and infotainment sectors and better cost management.
The LG Business Solutions Company saw improved first-quarter revenues of KRW 1.86 trillion (USD 1.67 billion), an increase of 9.1 percent from a year ago and 23.6 percent higher than the previous quarter largely on the back of strong demand for products such as monitors and PC products in the era of remote working and online learning. Operat-ing profit of KRW 134 billion (USD 120.38 million) declined from the same quarter last year due to the increasing cost of components such as LCD panels and semicon-ductors.
2021 1Q Exchange Rates Explained
LG Electronics’ unaudited quarterly earnings results are based on IFRS (International Financial Reporting Standards) for the three-month period ending March 31, 2021. Amounts in Korean won (KRW) are translated into U.S. dollars (USD) at the average rate of the three-month period of the corresponding quarter — KRW 1,113.16 per USD.
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