LG Electronics Q4 revenue up 1.5%, net loss hits KRW 258 bln

News Wireless Global 25 JAN 2017
LG Electronics Q4 revenue up 1.5%, net loss hits KRW 258 bln

LG Electronics reported sales of KRW 14.77 trillion in the fourth quarter of 2016, which represents an increase of 1.5 percent year-on-year, and 11.7 percent quarter-on-quarter. Both the LG Home Appliance & Air Solutions Company and LG Home Entertainment Company posted their strongest operating profit ever in 2016. However, due to losses from the Mobile Communications and Vehicle Components divisions, LG reported a fourth-quarter net loss of KRW 258.80 billion (approximately USD 223.98 million).

LG Electronics said its operating profit reached KRW 1.34 trillion in 2016, which represents an increase of 12.2 percent from 2015 due in large part to strong performance by home appliances, air solutions and home entertainment. For full-year 2016, LG reported revenues of KRW 55.37 trillion and net income of KRW 126.3 billion.

LG’s Mobile Communications division saw its revenue increase 15 percent quarter-on-quarter to KRW 2.90 trillion, mainly boosted by strong sales of the premium smartphone V20, the company said. Sales were still down from KRW 3.67 trillion in Q4 2015. 

Smartphone shipments reached 14.1 million units, up 4 percent sequentially and down 8 percent year-on-year. Smartphone shipments in North America region increased 15 percent quarter-on-quarter, while shipment of mass-tier smartphone K/X Series rose 1 percent quarter-on-quarter. 

LG’s Mobile Communications division saw losses continue due to weak sales of the flagship G5, marketing expense for the V20, and expenses associated with finalizing the business structure improvement activities. The operating margin was a negative 16.1 percent versus a negative 17.3 percent in Q3 and minus 1.7 percent a year earlier. 

For 2017, LG said it aims to recover its premium position with a successful new flagship model. It's expected to unveil the G6 at Mobile World Congress next month. The company also wants to create a "mega hit" mass-market model to support profitable growth. For the first quarter, LG targets a high single-digit annual increase in group revenue and "significant" improvement in profits compared to Q4.

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