LG Electronics on the eve of Saturday have announced that their estimated fourth-quarter operating earnings will be 65.5 billion won ($51.6 million), down 91.2 percent from a year earlier.
According to the company’s earnings guidance, revenue increased 5.2 percent year over year to 21.85 trillion won, setting a new quarterly high. But it withheld the information regarding net income.
The operating profit was 79.5% less than the average estimate, according to a survey by yonhap infomax, the news agency’s financial data provider.
The second-largest home appliance company in South Korea reported operating profit of approximately 3.54 trillion won, a decrease of 12.6 percent from the prior year. However its annual sales increased by 12.9 percent to a record 83.46 trillion won. This is the first time for the company to post such a high annual sales.
The fourth quarter earnings details have not been disclosed by the company but the experts proclaim that a hike in raw material prices , increased marketing cost and the weakening of Korean currency likely hurt the business’s bottom line from October through December.
In reality the demand for televisions has decreased globally due to the prolonged Russia-Ukraine war, While rising promotion costs to sell its inventory was also a factor in the sharp quarterly drop.
However the Korean heavyweight is expected to retain its position as world’s no 1 in home appliances market , followed by Usa’s whirlpool for 2022 in terms of sales. The company rose to rank 1 in 2021 for the very first time
On the other hand, as the shortage of auto chips gradually subsides and auto production rises as a result, its business selling EV components is likely to continue to turn a profit thanks to rising demand.
Business analyst expects that LG will make a turnaround in the new year due to decreased logistics cost and raw material cost
