LG Electronics projects $64 billion annual sales record for last year

LG Electronics projected an all-time sales high of 84.3 trillion won ($64 billion) last year as its appliance products and automotive business garnered robust demand.

LG Electronics' headquarters in Yeouido, western Seoul [YONHAP]

LG Electronics projected an all-time sales high of 84.3 trillion won ($64 billion) last year as its appliance products and automotive business garnered robust demand.

The annual sales record, announced in a preliminary earnings announcement Monday, is up 1 percent compared to the previous year, slightly above the market consensus of 84 trillion won.

Its operating profit is expected to reach 3.5 trillion won, falling short of the consensus at 3.9 trillion won, which was compiled by market tracker FnGuide. The 2023 operating profit is down 0.1 percent from over a year ago.

For the fourth quarter alone, the operating profit of LG Electronics surged by 350.9 percent to 312.5 billion won while sales edged up 5.9 percent to 23.2 trillion won.

The upbeat result runs in contrast to competing electronics makers reeling from a slowdown in consumer demand. LG attributed its growth to the focus on enterprise clients.

"Strategic efforts to enhance the business portfolio, including the early identification of market turning points to drive high growth in B2B sectors, played a pivotal role," it said in a statement. "Business model innovation, such as diversifying from hardware-oriented businesses to platform-based service business, also contributed to maintaining stable profitability," it said.

Its consumer electronics business, which covers air conditioners, refrigerators and other home appliances except for TVs, generated over 30 trillion won in sales.

The automotive segment, considered a new business area for LG, brought in 10 trillion won last year, as it enjoys solid demand from EV manufacturers. "The average operating rate of production facilities has surpassed 100 percent since last year, driving growth," the company said in the statement. "Starting this year, LG will intensify efforts to secure capabilities in the evolving trend of software-defined vehicles while aiming for growth in volume."

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]