Seoul, South Korea — LG Electronics reported a 165 percent increase in second-quarter net profit compared with the same period last year, reflecting strong earnings from both the TV and mobile operations.
LG said it had second-quarter 2014 net profit of KRW 412 billion ($399.8 million) and operating profit of KRW 606 billion ($588.5 million), an increase of 26.5 percent year over year.
Unaudited second-quarter consolidated revenues of KRW 15.37 trillion ($14.93 billion) increased 7.7 percent from the previous quarter.
LG Home Entertainment Company had second quarter revenues of KRW 5.09 trillion ($4.94 billion), a 3 percent increase quarter over quarter and almost unchanged from the same quarter in 2013. Operating profit of KRW 154.5 billion ($150 million) was an increase of 64.9 percent from the same quarter last year as a result of better product mix and lower fixed costs.
Demand for Ultra HD TVs in key markets will continue to drive LCD TV revenue growth. The B-to-B market, led by monitors and digital signage, also is expected to contribute to LG’s growth in this segment, the company noted.
LG Mobile Communications said it shipped a record-high 14.5 million smartphones in the second quarter, a 20 percent increase year over year, with LTE products accounting for more than one-third of all LG smartphones sold this year.
As a result, sales increased 16 percent from the same period last year to KRW 3.62 trillion ($3.51 billion), the highest since the first quarter of 2010. The mobile division’s operating profit of KRW 85.9 billion ($83.4 million) in the second quarter put an end to three consecutive quarters of losses.
Much of the success was due to the initial popularity of the LG G3 in the Korean market and strong sales of L-series smartphones. LG plans to continue its global rollout of the G3 and introduce more mass-tier products in the second half, including variations of the LG G3, such as the recently announced G3 Beat, and additional L-series models, the company said.
LG Home Appliance recorded strong sales in the Korean market, with sales increasing 9 percent from the same quarter the previous year. Second-quarter revenue of KRW 3.03 trillion ($2.94 billion) was 5 percent lower compared with the same period last year due to unfavorable foreign currency exchange movement, especially in developing markets.
An improvement in cost structure resulted in LG Home Appliance recording operating profit of KRW 97.8 billion ($95 million) and profit margin of 3.2 percent. LG expects revenues and profitability for home appliances to increase in the second half due to the launch of market-leading washing machine and refrigerator products and the effect of cost reductions.