Seoul: LG Electronics, a leading home appliance manufacturer in South Korea, said on Monday that its third-quarter operating profit is estimated to have dropped more than 8 percent from a year earlier due to rising tariff costs.Operating profit for the three months ended in September came to an estimated 688.9 billion won ($482.6 million), down 8.4 per cent from a year earlier, the company said in a regulatory filing, reports Yonhap news agency.Its revenue decreased 1.4 per cent on-year to 21.87 trillion won. The data for net income was not available.
The operating profit, however, beat market expectations as it was 13.9 per cent higher than the average estimate, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.LG Electronics attributed the profit decline to rising tariff burdens, particularly stemming from changes in the U.S. trade policy.Its voluntary retirement program also contributed to the weak bottom line, it added.
Despite the challenges, LG Electronics said its business-to-business (B2B) operations, including electric vehicle (EV) components, posted solid growth during the quarter, while its conventional home appliance business maintained market dominance and competitiveness.
The company said it will continue to focus on expanding its B2B and subscription-based businesses to strengthen its long-term business fundamentals. In particular, the planned completion of the initial public offering (IPO) of its Indian subsidiary is expected to help the company raise capital for its push to reorganize its business portfolio and seek future growth drivers.
The company will release its final earnings report later. Earlier, LG Energy Solution said on Monday its third-quarter operating profit likely jumped 34.1 percent from a year earlier, driven by strong sales of energy storage systems (ESSs) in the United States. In the three months ended September, operating profit is estimated to have surged to 601.3 billion won (US$422.8 million) from 448.3 billion won in the same period last year, the company said in a regulatory filing.
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