Although LG Electronics's overall first-quarter revenues and operating income declined somewhat in 2019 versus 2018, the company's home appliance unit reported record first-quarter sales and profits.
Overall, LG Electronics announced consolidated sales of KRW 14.92 trillion (USD 13.27 billion) and operating profit of KRW 900.6 billion (USD 801.25 million) for the first quarter of 2019.
Operating income was 1,090 percent higher than the fourth quarter of 2018, reflecting improved cost structures across major business units.
The LG Home Appliance & Air Solution Company generated first-quarter revenues of KRW 5.47 trillion (USD 4.86 billion) and operating profit of KRW 727.6 billion (USD 647.3 million), the highest quarterly revenue and operating income for the business unit in LG history. Sales were especially strong in Europe and Asia, contributing to growth of 11 percent year-on-year and 26 percent quarter-on-quarter on sales of premium and growth products especially in the domestic Korean market. The increase in operating profit of more than 30 percent from the same period last year also can be attributed to the popularity of high-growth products such as Styler, clothes dryers, air purifiers and vacuum cleaners as well as effective cost reduction efforts.
The LG Home Entertainment Company reported first-quarter revenues of KRW 4.02 trillion (USD 3.58 billion) and operating profit of KRW 346.5 billion (USD 308.27 million), a decrease of 3 percent from the same period the previous year due to seasonal weakness in demand and the lack of global sporting events. Operating income increased significantly from the previous quarter thanks to greater marketing efficiencies and improvement cost structure. LG expects the launch of new 2019 premium products including OLED TVs, NanoCell TVs and large-screen Ultra HD TVs to generate additional sales opportunities in the second quarter.
The LG Mobile Communications Company saw first-quarter sales of KRW 1.51 trillion (USD 1.34 billion) and narrowed its quarterly operating loss to KRW 203.5 billion (USD 181.05 million) as LG continues to rebuild its smartphone business. Looking ahead, LG expects the launch of LG V50ThinQ 5G smartphone to create positive momentum in the second quarter. In addition, the relocation of LG’s smartphone manufacturing center from Pyeongtaek, Korea to Haiphong, Vietnam may help improve profitability and LG’s global competitiveness in the second half of the year.
The LG Vehicle Component Solutions Company recorded first-quarter revenues of KRW 1.35 trillion (USD 1.20 billion), a 61 percent increase from the same period last year.
The LG Business Solutions Company posted first-quarter sales of KRW 626.6 billion (USD 556.58 million), 5 percent higher than the previous quarter and 3 percent lower than the first quarter a year ago.