LG Electronics today announced a 28% in revenues for the three-month period ending March 31, 2010, attributed to strong performance in the Home Entertainment and Home Appliance sector. However, the company’s mobile division reported a decrease of 19.4% year-on-year, as a result of a drop in mobile phone prices.
LG’s unaudited earnings results, based on International Financial Reporting Standards, showed Q1 sales of USD 11.9 billion and an operating profit of USD 462 million, up 28% and 26% (in USD) respectively year-over-year.
The LG Home Entertainment Company’s revenues grew 20% from a year ago, as demand for flat panel TVs surged, resulting in sales of USD 4.5 billion and an operating profit of USD 159 million. The new line-up of full LED LCD TVs saw an increase of 62% in shipments, up to 5.2 million units, compared to last year’ s first quarter.
While LG built strong sales from its home entertainment department, its mobile communication division posted a sharp decrease of 19.4% year-over-year, justified by the low season, a drop in mobile phone prices and increases in marketing expenses. The company reportedly shipped 27.1 million mobile phone units and plans to introduce more smartphones to improve sales and profitability in this sector.
Both LG Home Appliance Company and LG Business Solutions Company registered 33% and 15.4% growth respectively on sales in the stated period, with the business division reporting a growing demand for IT products in emerging markets.
LG adopted the International Financial Reporting Standards (IFRS) in 2010, with the objective of unifying its global accounting and financial reporting standards. The 104 subsidiaries of which LG owns more than 50 percent of voting shares have been consolidated under IFRS, including overseas subsidiaries and LG Innotek. As a result, LG Display, in which LG Electronics owns a 37.9 percent stake, will no longer be consolidated in LG Electronics’ earnings results.
LG comprises of five business units – Home Entertainment, Mobile Communications, Home Appliance, Air Conditioning and Business Solutions. LG is one of the world’s leading producers of flat panel TVs, audio and video products, mobile handsets, air conditioners and washing machines.
