LG Electronics Reports Increased Q4 Loss Amid Currency Fluctuations
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Synopsis
Seoul, Jan 23 (NationPress) LG Electronics, a key player in South Korea's home appliance industry, revealed on Thursday that its fourth-quarter net loss has intensified from the previous year due to significant foreign exchange translation losses attributed to a weak won.
Key Takeaways
- LG Electronics reported a net loss of 713.7 billion won.
- Operating profit dropped 56.7% to 135.4 billion won.
- Sales increased slightly by 0.1% to 22.76 trillion won.
- The dollar's average price rose to 1,396.84 won.
- The company plans to introduce AI-driven premium home appliances.
Seoul, Jan 23 (NationPress) LG Electronics, a prominent manufacturer of home appliances in South Korea, announced on Thursday that its net loss for the fourth quarter has significantly increased compared to the previous year, primarily due to a weakened won resulting in higher foreign exchange translation losses.
The company reported a net loss of 713.7 billion won ($496.8 million) for the three-month period ending December 31, contrasting with a net loss of 76.4 billion won in the fourth quarter of 2023, according to a regulatory filing.
“The augmented translation losses from dollar-denominated financial debt and interest expenses incurred by the company’s overseas subsidiaries have further impacted the financial results,” stated a company representative during a phone call with Yonhap news agency.
Data from the Bank of Korea indicated that the dollar averaged 1,396.84 won in the fourth quarter, up from 1,320.84 won a year ago.
Operating profit saw a dramatic decline of 56.7 percent, falling to 135.4 billion won in the fourth quarter, down from 312.5 billion won in the same period last year.
In the October-December timeframe, elevated marketing expenses aimed at boosting home appliance sales amidst subdued consumer spending, coupled with sharply rising logistics costs, also adversely affected the operating profit, the company noted in a press release.
Sales experienced a slight increase of 0.1 percent, reaching 22.76 trillion won, up from 22.73 trillion won during the same timeframe.
To navigate the swiftly evolving business landscape, LG Electronics plans to continue restructuring its home appliance-focused business portfolios and identify new growth avenues, as per the release.
While enhancing the competitiveness of its core home appliance division, the company aims to launch premium products featuring artificial intelligence (AI) technologies, along with advanced vehicle solutions for upcoming software-defined vehicles.
For the entirety of 2024, net income nearly halved to 591.4 billion won, down from 1.15 trillion won the prior year.
Operating profit fell by 6.4 percent year-on-year to 3.41 trillion won, while sales rose by 6.6 percent to 87.72 trillion won.
