3G boosts LG

January 25, 2005 - source: BWCS

Korean electronics giant and major mobile handset vendor LG Electronics has reported soaring net profits for last year. The company said that its net profit figure rose 130% to US$1.48 billion on record sales for the twelve months to end of December 2004. In the final quarter of the year LG claimed that its revenues and profits were greatly boosted by sales of its range of 3G handsets.

Net profit in the final three months of last year stood at US$139 million, compared to a loss of US$15 million for the same period the year before. For the full year, the company announced that sales had jumped 22.2% to 24.7 trillion won. However, whilst net profits stormed ahead in 2004, a weakening domestic currency meant that the company's operating profits rose by only 17.7% to 1.25 trillion won.

Exports from Korea accounted for almost 80% of LG's revenues during 2004 and sales abroad jumped 27.2% during the year, compared to a more modest rise of 6.1% in its domestic market. Financial analysts pointed out that, once again, the sale of mobile handsets had been the main driver of growth at the company.

LG itself believes that that phone sales will rise by around 40% in 2005, to 62 million units, up from 40 million last year. It also pointed out, with relish, that it has won large orders for 3G handsets from the likes of Hutchison Whampoa and France Telecom"s Orange. LG shipped about 13.5 million handsets in the fourth quarter of 2004, up from 11.8 million in the third quarter. The company also overtook Sony Ericsson in the third quarter with a 7% share of the world market for mobile phones; it currently ranks as the fifth largest handset vendor, behind Nokia, Motorola, Samsung and Siemens.