SEOUL: LG Electronics has announced that its operating profit fell 21 per cent in the fourth quarter from a year earlier due to a hike in logistics and raw material costs and weaker-than-expected holiday spending on home appliances.
Operating profit slumped to 677.7 billion won ($563 million) in the October-December period, it said in a regulatory filing. Operating profit was lower than the market consensus of 813.7 billion won in a survey by Yonhap Infomax.
But its sales reached a record quarterly high of 21.01 trillion won for the three months ended in December, up 20.7 percent from a year earlier, helped by its strong home appliance business.
The tech giant's home appliance and air solution unit logged record quarterly sales of 6.52 trillion won, up 17.7 per cent from the previous year.
Sales of its home entertainment unit came to 4.99 trillion won, up 16.4 per cent from a year ago thanks to the growth in demand for premium OLED and large-screen TVs in key European and North American markets.
While the company did not provide the exact shipments of OLED TVs last year, it said it surpassed its sales target by 60 percent in the fourth quarter. For the whole year, the company shipped twice as many OLED TVs as it did the previous year, reports Yonhap news agency.
It said it will "continue keeping the growth momentum by launching improved new models and leveraging our dominant position in the market," as "demand for premium products will remain robust."
Its vehicle component solutions unit, considered to be LG's next growth engine, however, continued to log an on-year operating loss, weighed down by pandemic-caused business uncertainties and the global chip shortage. The unit reported 1.68 trillion won in sales, down 12.3 percent from a year ago.