LG Display Reports Second Quarter 2022 Results2022.07.28
LG Display today reported unaudited earnings results based on consolidated K-IFRS (International Financial Reporting Standards) for the three-month period ending June 30, 2022.
■ Revenues in the second quarter of 2022 decreased by 13% to KRW 5,607 billion from KRW 6,471 billion in the first quarter of 2022 and decreased by 19% from KRW 6,966 billion in the second quarter of 2021.
■ Operating loss in the second quarter of 2022 recorded KRW 488 billion. This compares with the operating profit of KRW 38 billion in the first quarter of 2022 and with the operating profit of KRW 701 billion in the second quarter of 2021.
■ EBITDA in the second quarter of 2022 was KRW 662 billion, compared with EBITDA of KRW 1,211 billion in the first quarter of 2022 and with EBITDA of KRW 1,770 billion in the second quarter of 2021.
■ Net loss in the second quarter of 2022 was KRW 382 billion, compared with the net income of KRW 54 billion in the first quarter of 2022 and with the net income of KRW 424 billion in the second quarter of 2021.
LG Display recorded KRW 5.607 trillion in revenues and KRW 488 billion in operating loss in the second quarter of 2022.
The company saw a decrease in panel shipments in the quarter due to China’s prolonged COVID lockdown, as well as a shrink in industry demand affected by the market’s increasing macroeconomic volatility and uncertainties. China’s lockdown had a particularly disruptive impact on set makers and partner companies which in turn led to supply chain disruption. In addition, the continuous decline in LCD panel prices was also a contributing factor to the company’s performance.
Panels for TVs accounted for 31% of the revenues in the second quarter, while panels for IT devices including monitors, laptops, and tablets accounted for 45%, and those for mobile devices and the others accounted for 24%.
LG Display will make efforts to expand its performance focusing on OLED in the second half of this year, while also concentrating on recovering the shipment disruption during the first half of this year caused by China lockdown.
In its large-sized OLED business, LG Display will further strengthen its position in the premium market based on its fundamental competitiveness of OLED technology and push for qualitative growth. The company will also accelerate new businesses in the Life Display sector such as Transparent OLED. While the overall TV market is expected to see a year-on-year decline, OLED TV set sales are showing meaningful performance.
Regarding the IT display sector, LG Display will focus on premium market with relatively low fluctuation to secure stable performance. The company additionally plans to recover from the disruption of shipments of high-end LCD panels for IT devices that was affected by China’s COVID lockdown, while getting prepared for leading the mid-sized OLED market, thereby strengthening its technology leadership.
For the small-sized OLED business, the company will further improve its performance based on differentiated competitiveness and collaboration with customers by responding to the rising demands for smartwatches and supplying new smartphone models in the second half of the year.
For the automotive display sector, LG Display plans to broaden its market dominance by providing differentiated solutions with its lineup ranging from OLED to high-end LCD, remaining global number 1 in the Auto display in terms of sales and further strengthen activities with the goal of exceeding 30% market share in the next three years.
Considering the recent market conditions and business competitiveness, the company will accelerate its plan to reduce its LCD TV panel business and concentrate more on high-end IT products.
“LG Display plans to strengthen its risk management and react flexibly to market changes in the face of global economic uncertainties by advancing its business structure, increasing management efficiency, managing inventory, and improving investment efficiency.” said Sung-hyun Kim, CFO and Senior Vice President at LG Display.
Kim also added, “LG Display is actively implementing activities to create robust performance that is unaffected by the market and to discover future growth engine. To this end, we will further strengthen dominance in the large-sized OLED and IT sectors where the company has differentiated competitiveness, push for “market-to-order business” and accelerate efforts for “market-creating business”, all the while preparing for preempting future business and building the base for business development.”