LG Electronics Inc. (LG) continued its strong performance in 2021, achieving the highest annual revenues in its history with full-year sales of KRW 74.72 trillion (USD 63.16 billion). This increase of 28.7 percent over 2020 was attributed primarily to stronger sales of premium home appliances and OLED TVs. Operating profit of KRW 3.86 trillion (USD 3.27 billion) was essentially unchanged, declining 1 percent from the previous year.
LG also reported record sales in the fourth quarter with revenues of KRW 21.01 trillion (USD 17.76 billion), an increase of 20.7 percent from the same quarter the previous year. Operating profit of KRW 677.7 billion (USD 572.87 million) in the quarter declined 21.4 percent from the same quarter a year earlier due in large part to factors such as higher raw material and global logistics costs. As challenging business conditions persist into 2022, LG is staying the course to strengthen competitiveness by further improving its cost structure and continuing to expand the presence of its premium appliances and TVs in the global market.
The LG Home Appliance & Air Solution Company saw another record-setting year with 2021 revenues of KRW 27.11 trillion (USD 22.92 billion), an increase of 21.7 percent from the previous year, driven largely by strong performance in new appliance categories such as hygiene products. Annual operating profit of KRW 2.22 trillion (USD 1.88 billion) was 2.9 percent lower than in the previous year due to higher costs for raw materials and global logistics. Record fourth-quarter revenues of KRW 6.52 trillion (USD 5.52 billion) were 17.7 percent higher than the same period 2020.
The LG Home Entertainment Company reported 2021 revenue growth of 30.6 percent to KRW 17.22 trillion (USD 14.56 billion) with operating profit increasing 18.1 percent over the previous year to KRW 1.1 trillion (USD 929.68 million), reflecting LG’s success in responding to the higher demand for premium TVs during the pandemic. Revenues in the quarter of KRW 4.99 trillion (USD 4.21 billion) were 16.4 percent higher than fourth quarter the prior year and up 19.2 percent from the previous quarter owing to the growth in demand for premium OLED and large-screen TVs in key regions of Europe and North America.
The LG Vehicle component Solutions Company increased revenues by 24 percent in 2021 from 2020 to KRW 7.19 trillion (USD 6.08 billion), exceeding KRW 7 trillion for the first time. Revenues in the fourth quarter of KRW 1.68 trillion (USD 1.42 billion) declined 12.3 percent from the same quarter the previous year. Under the cloud of uncertainty created by the new COVID-19 variant, the global automotive market experienced significant disruption due to the shortage of automotive semiconductors.
The LG Business Solutions Company achieved 2021 revenues of KRW 6.96 trillion (USD 5.89 billion), a 15.8 percent increase over the previous year while higher material costs and supply chain challenges resulted in an annual operating profit of KRW 144.3 billion (USD 121.98 million). Fourth-quarter revenues increased 14 percent from the same period in 2020 to KRW 1.72 trillion (USD 1.46 billion) on the back of strong demand for premium PCs and gaming monitors. An increase in cost of global logistics and slowdown of solar module sales due to increased competition contributed to a fourth-quarter operating loss of KRW 35.1 billion (USD 29.67 million).
2021 4Q Exchange Rates Explained
LG Electronics’ unaudited quarterly earnings results are based on IFRS (International Financial Reporting Standards) for the three-month period ending December 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 1,182.99 per USD.
Earnings Conference and Conference Call
LG Electronics will hold a Korean / English conference call on January 27, 2022 at 16:00 Korea Standard Time (07:00 GMT/UTC). Conference call participants are instructed to pre-register online to receive a private PIN. To participate in the conference call, dial +82 31 810 3130, enter passcode 6418# and then the PIN. The corresponding presentation file will be available for download at the LG Electronics website before the call.
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