LG Innotek Q3 net down 25.8% on fluctuating exchange rate
Summary
LG Innotek reported lower third-quarter profits on Tuesday as exchange-rate fluctuations weighed on profitability. Net profit for July-September fell 25.8 percent year on year to 95.2 billion won, while operating profit declined 53.4 percent to 94.8 billion won. Sales rose 18.6 percent to a third-quarter record of 6.36 trillion won, with revenue increasing across all business segments. The company said higher sales reflected expanded supplies of high-value camera modules and increased shipments of automotive cameras to North American customers.
Key Facts
- LG Innotek said the won weakened against the U.S. dollar when it bought raw materials in the first half of the year, then strengthened sharply as the company began mass-producing and shipping products in the third quarter.
- Third-quarter sales exceeded 6 trillion won for the first time in that period and reached a record high.
- The optical solutions division, which produces camera modules, recorded sales of 5.4 trillion won, up 20.6 percent year on year.
- The company attributed optical solutions growth to mass production of new products and expanded supplies of high-value-added camera modules for mobile devices.
LG Innotek's headquarters in Gangseo District, Seoul / Courtesy of LG Innotek
LG Innotek, an electronic components manufacturer under LG Group, said Tuesday its third-quarter net profit fell 25.8 percent from a year earlier, as exchange-rate fluctuations weighed on profitability.
Net profit for the July-September period came to 95.2 billion won ($71.9 million), down 128.4 billion won from a year earlier, the company said in a regulatory filing.
LG Innotek said its net profit declined as the Korean won weakened against the U.S. dollar when it purchased raw materials in the first half of the year but strengthened sharply by the time the company began mass-producing and shipping products in the third quarter.
Operating profit for the cited period fell 53.4 percent on-year to 94.8 billion won.
Sales, on the other hand, rose 18.6 percent to 6.36 trillion won, surpassing 6 trillion won for the first time in the third quarter and reaching a record high for the period.
Revenue increased across all business segments from a year earlier.
The optical solutions division, which produces camera modules, posted sales of 5.4 trillion won, up 20.6 percent from a year earlier.
The growth came as LG Innotek expanded supplies of high-value-added camera modules for mobile devices following the start of mass production for new products.
Shipments of automotive cameras to North American customers also increased.
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