LG Electronics Reports Fourth Quarter 2006 Earnings Results

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2007-01-23 14:11

Seoul--(뉴스와이어)--LG Electronics (LG), a leader in consumer electronics and mobile communications, announced unaudited earnings results of the three month period ended December 31, 2006. Amounts in Korean Won (KRW) are translated into US dollars (USD) at the average rate of three month period in each quarter, which was KRW 938 per US dollar (2006 4Q), KRW 955 per US dollar (2006. 3Q, QoQ), KRW 1,037 per US dollar (2005. 4Q, YoY). Average rate of twelve month period in 2006 was KRW 955 per US dollar and 2005 was KRW 1,024 per US dollar.

Sales and Profit

Sales in the fourth quarter of 2006 decreased 8.8% to KRW 5.521 trillion (USD 5.886 billion) from KRW 6.054 trillion (USD 6.339 billion) a quarter earlier, and minus 11% from KRW 6.182 trillion (USD 5.961 billion) a year ago, primarily due to tight control of year-end inventories and decline of display product shipment at Parent level. Global level figures including LG Electronics overseas affiliates increased 9.8% QoQ. Operating profit recorded loss of KRW 43 billion (USD 46 million).

2006 annual sales reached KRW 23.2 trillion (USD 24.2 billion) at parent level, fell 3% from the previous year, and net profit was KRW 212 billion (USD 222 million). Sales at global level in comparison increased 3% to KRW 36.73 trillion (USD 38.46 billion) from KRW 35.56 trillion (USD 34.73 billion). Consolidated sales including subsidiaries has risen 4% to KRW 46.27 trillion (USD 48.45 billion) from KRW 44.45 trillion (USD 43.41 billion).

Mobile Communication Company recorded sales of KRW 2.350 trillion (USD 2.505 billion), 2.3% higher than a quarter earlier and 12.3% down from a year earlier. From the handsets business only, revenue rose 2.9% to KRW 2.187 trillion (USD 2.332 billion) from KRW 2.126 trillion (USD 2.226 billion) QoQ and 10.8% lower YoY. Total shipments were 17.0 million units (8.9 million in CDMA, 6.2 million in GSM, 1.8 million in WCDMA), which makes 64.4 million units in total year 2006. Strong performance in North America was geared by WCDMA phones and in open-markets including Europe, Asia and Middle East and Africa regions led a shift in GSM. Operating profit declined 1% to 2.7% from 3.7% QoQ due to price cut on some key products.

Digital Display Company sales decreased 13.9% YoY to KRW 1.200 trillion (USD 1.279 billion) due to intensified price erosion and year-end inventory control. Severe competition with LCD panels in 40” segment led a decline in shipments of plasma panels and loss in operating profit. Performance of plasma and LCD TV business rose 55% and 72% QoQ based on shipments. Sales from media and IT products, Digital Media Company, was minus 0.3% QoQ to KRW 657 trillion (USD 700 billion).

Digital Appliance Company sales rose 5.8% to KRW 1.311 trillion (USD 1.397 billion) YoY, thanks to strong premium product sales; rose 17% in Korea and 10%, in US dollar basis, overseas. Sales in US grew 24% YoY thanks to strong sales of three-door refrigerators and steam drum-type washing machines. Operating profit increased 23.4% YoY to KRW 62 billion (USD 66 million), improved by increase in revenue from the premium product categories which reached to 60% from 57% of total sales.

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Non-operating Items

Recurring profit stood at KRW 58 billion (USD 62 million) primarily led by strong equity method gain of KRW 137 billion (USD 146 million). Gains are KRW 100 billion (USD 107 million) from LG Electronics overseas affiliates and KRW 61 billion (USD 65 million) from LG-Nortel. Loss in equity method from LG.Philips LCD has been improved to minus KRW 21 billion (USD 22 million) from minus KRW 109 billion (USD 114 million) QoQ.

2007 Sales Outlook

Goal for 2007 Sales is KRW 40.0 trillion (USD 44.5 billion) at global level and KRW 24.0 trillion (USD 26.7 billion) at parent level, which are 9% and 3% increase from the performance of 2006. Prospects for the new year are to attain profitable growth and to improve market leadership in GSM business. Anticipated total shipments are 78 million units, an increase of 22 percent compared to 64 million units last year. In display division, LG aims to increase market share in flat panel display TVs by reinforcing full HD product line-ups and channel coverage. Strong sales in appliance division, air conditioners plus design and high-tech focused premium products will keep the Company’s solid position profitable in global market.

About LG Electronics, Inc.

LG Electronics, Inc. (KSE: 06657.KS) is a global leader and technology innovator in consumer electronics, home appliances and mobile communications, employing more than 82,000 people working in over 120 operations including 80 subsidiaries around the world. Comprising four business units -- Mobile Communications, Digital Appliance, Digital Display and Digital Media with 2006 global sales of US $38.6 billion -- LG Electronics is the world’s largest producer of CDMA handsets, air conditioners, optical storage products, DVD players and home theater systems. For more information, please visit www.lge.com.

LG Electronics 개요
LG Electronics Inc., (KSE: 06657.KS) is the leader in consumer electronics and mobile communications. The company has more than 72,000 employees working in 77 subsidiaries and marketing units around the world. LG Electronics is the world’s largest producer of CDMA handsets, residential air conditioners, optical storage devices and home theatre systems. With total revenue of more than USD 35 billion (consolidated USD 45 billion), LG Electronics is comprised of four business units: Mobile Communications, Digital Appliance, Digital Display and Digital Media. For more information, please visit www.lge.com.

웹사이트: http://www.lge.com