LG Electronics Inc. has just released the financial results of the second quarter of 2020, which was affected significantly by the impact of the pandemic.
Consolidated revenue of KRW 12.83 trillion (USD 10.51 billion) was 17.9 percent lower than the same period of 2019, while operating profit of KRW 495.4 billion (USD 405.65 million) declined 24.1 percent from last year’s record second-quarter operating income.
The Home Appliance and Air Solution Company reported revenues of KRW 5.16 trillion (USD 4.22 billion) in the second quarter, which was lower by 15.5% than Q2 of 2019. Operating income of KRW 628 billion (USD 514.23 million) declined 12.5% year-on-year through operating profit margin of 12.2% was the highest second quarter in the history of the LG H&A Company. LG H&A Company is buoyed by increasing consumer interest in healthier living.
The Q2 revenue and profitability of the Home Entertainment Company was impacted by lockdown measures including closures of retail stores. Sales were KRW 2.26 trillion (USD 1.85 billion), a decline of 24.4% from last year’s second quarter, while the operating income of KRW 112.8 billion (USD 92.37 million) was 25.9% lower. LG HE Company is aggressively increasing the proportion of premium TV products, expanding online sales, and continuing to reduce material costs, among others to bring profitability in line with 2019.
The Mobile Communications Company posted Q2 sales of KRW 1.31 trillion (USD 1.07 billion) which is a 31.1% increase from the first quarter. The operating loss of KRW 206.5 billion (USD 169.10 million) narrowed compared to both Q2 2019 and Q1 2020 as a result of improved marketing efficiencies and greater cost controls.
The Vehicle Components Solutions recorded quarterly revenues of KRW 912.2 billion (USD 746.95 million), a 40% decline from the same quarter last year, and an operating loss of KRW 202.5 billion (USD 165.82 million) as a result of pandemic-related manufacturing shutdowns of global automakers.
The Business Solutions Company reported sale of KRW 1.31 trillion (USD 1.07 billion) in the second quarter, while operating income declined to KRW 98.30 billion (USD 80.49 million). LG’s B2B division is focused on creating business opportunities to help tackle the ongoing challenges.
LG Electronics’ unaudited quarterly earning results are based on IFRS (International Financial Reporting Standards) for the three-month period ending June 30, 2020.