LG Electronics has announced a first-quarter 2020 operating profit of US$921.47 million (A$1.41 billion), a 21.1% increase from Q1 2019, the highest in the company’s history for a first quarter.
Revenue from its home appliance and air solutions division was unchanged from Q1 2019 due to softer global demand from COVID-19. However, this was offset by higher sales in Korea of steam appliances such as washers, dryers, dishwashers and the LG Styler clothing care system, reflecting consumer interest in health and hygiene. Operating profit and operating margin were the highest in LG’s history, benefitting from cost-reduction efforts and increased interest in premium products.
While LG home entertainment Q1 revenue decreased, a reclassification of IT products to the business solutions division saw operating income increase by 31.7% as a result of operating efficiencies and expansion of premium products such as OLED TVs and NanoCell TVs.
Q1 sales from the LG mobile communications decreased nearly 34%. The LG Velvet 5G smartphone launch in Korea in Q2 is said to mark a new direction for the smartphone business with a different design philosophy, value-conscious components and enhanced online sales initiatives.
Q1 sales from LG business solutions were 18.8% higher than the previous quarter due to demand for solar modules, information displays and LG notebooks.