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LG Electronics posts surprise Q1 earnings on fridge, TV sales

Xinhua, April 11, 2016 Adjust font size:

LG Electronics, South Korea's No.2 maker of smartphones, posted a surprise first-quarter earnings result on the back of strong sales of refrigerators, air conditioners and TVs, a regulatory filing showed on Monday.

Preliminary figure for operating profit reached 505.2 billion won (440 million U.S. dollars) in the three months ending March 31, up 65.5 percent from a year earlier. It was 44.8 percent higher than the previous three-month period.

Revenue amounted to 13.36 trillion won in the first quarter, up 4.5 percent from a year ago.

It marked the first time that the South Korean tech giant announced preliminary figures for a quarterly earnings result. Net income and details on each division will be announced later this month after auditing and approval by board of directors.

The operating profit far exceeded market expectations of about 427 billion won thanks to robust demand for LG home appliances.

Home Entertainment division, which makes TVs, was estimated to have posted an operating profit of about 200 billion won due to strong demand for OLED TVs.

Operating profit for the Home Appliance and Air Solution (H&A) unit was estimated at around 300 billion won, up from 215 billion won in the previous quarter.

The South Korean currency's weakness to the U.S. dollar was believed to have positively affected LG's first-quarter earnings.

LG's operating profit jumped from 478.8 billion won in the first quarter of 2014 to 609.7 billion won in the next quarter, before dropping to 275.1 billion won in the fourth quarter of that year. The operating profit stayed in the range of 200-300 billion won in 2015.

The Mobile Communications unit, which manufactures smartphones, was estimated to have recorded an operating loss in the first quarter, staying in the red for three straight quarters.

Some of market watchers expected the mobile unit to turn into the black in the second quarter amid positive effect from the launch of its new flagship G5 smartphone. Endit