LG Electronics Posts a Quarterly Record Sales for Third Quarter of 2004
3Q Sales Totals KRW 6,113 Billion, Operating Profit KRW 355 Billion, Net Profit KRW 304 Billion
Operating profit up 92.0%, recurring profit up 37.3%, Net Profit up 36.0% YoY
Seoul, Korea October', 2004 LG Electronics (LGE) posted record sales in the third quarter of 2004. On October', 2004, Mr. Young Soo Kwon, Chief Financial Officer of LG Electronics, announced the third quarter performance at the Korea Stock Exchange. Sales reached a quarterly record high of KRW 6,113 billion (export: KRW 4,871 billion, domestic sales KRW 1,241 billion), up by 24.3% on year and 1.4% on quarter. LGEs continued strong performance in the third quarter was propelled by strong sales of mobile handsets, digital TVs and air conditioners. LG Electronics generated KRW 355 billion in operating profit, KRW 442 billion in recurring profit, and KRW 304 billion in net profit.
LG Electronics recorded its largest quarterly sales in the third quarter of 2004 on the back of strong exports.
Sales from the Telecommunications Equipment & Handsets Company grew 61.3% yoy KRW 2,467 billion (domestic KRW 333 billion, export KRW 2,134 billion). Its operating profit reached KRW 230 billion with a margin of 9.3 %. Sales of handsets alone grew 64.2% yoy to KRW 2,285 billion, with unit growth rising 55% yoy to 11.8 million sets. In Korea, CDMA unit sales decreased 25% qoq owing to sluggish demand, versus 8% yoy increase. In overseas markets, CDMA unit sales increased 12% yoy thanks to the strong sales to North America. GSM unit sales jumped 353% yoy due to sales expansion in North America and WCDMA market share expansion in Europe.
Sales from the Digital Display & Media Company recorded KRW 2,179 billion (domestic KRW 330 billion, export KRW 1,849 billion). When excluding sales figures from PC business, sales increased 15% yoy. LGEs PC business has reduced its OEM portion, from 90% to 40%, to strengthen the LG brand business.
Strong sales of digital TV and PDP module led the yoy growth. Sales of digital TVs were up by 53% on year, with sales of PDP TV increasing 153% yoy, while PDP module sales more than doubled to 123% yoy. Operating profit reached KRW 66 billion with a 3.0% margin.
Sales from Digital Appliances Company increased 17.5% yoy to KRW 1,411 billion (domestic KRW 534 billion, export KRW 877 billion). A surge in domestic air-conditioner sales and strong exports of LG branded premium products led the overall growth. Exports and domestic sales were up 18% and 17% on-year, respectively.
Meanwhile, LG Electronics earned KRW 355 billion in operating profit, up by 92.0% on year, with a margin of 5.8%. Recurring profit rose 37.3% compared with the same period last year to record KRW 442 billion (margin 7.2%) on the back of equity method gains from LG.Philips LCD. Net profit reached KRW 304 billion with a margin of 5.0%.
Overall, strong sales of premium products led to margin improvement year on year in all LGEs businesses.
Fourth Quarter Forecast
Despite prolonged sluggish domestic economy and concerns over other external factors, such as rising oil prices and interest rate hikes in the U.S., total sales for 4Q 2004 is expected to rise 15% yoy thanks to the steady growth in handset exports.
About LG Electronics, Inc.
LG Electronics, Inc. (Korea Stock Exchange: 06657.KS) was established in'58 as the pioneer in the Korean consumer electronics market. The company is a major global force in electronics and information and communications products with more than 64,000 employees working in 75 overseas subsidiaries and marketing units around the world. With annual total revenues of more than US $29.9 billion (consolidated), LG Electronics comprises three main business companies: Digital Display & Media, Digital Appliances, Telecommunication Equipment & Handset.
LG Electronics Inc.