LG Display reported unaudited earnings results based on consolidated K-IFRS (International Financial Reporting Standards) for the three-month period ending December 31, 2021.
Revenues in the fourth quarter of 2021 increased by 18% to KRW 8,807 billion from KRW 7,493 billion in the fourth quarter of 2020 and increased by 22% from KRW 7,223 billion in the third quarter of 2021.
Operating profit in the fourth quarter of 2021 recorded KRW 476 billion. This compares with the operating profit of KRW 678 billion in the fourth quarter of 2020 and with the operating profit of KRW 529 billion in the third quarter of 2021.
EBITDA in the fourth quarter of 2021 was KRW 1,645 billion, compared with EBITDA of KRW 1,766 billion in the fourth quarter of 2020 and with EBITDA of KRW 1,696 billion in the third quarter of 2021.
Net income in the fourth quarter of 2021 was KRW 180 billion, compared with the net income of KRW 615 billion in the fourth quarter of 2020 and with the net income of KRW 464 billion in the third quarter of 2021.
LG Display registered KRW 29.9 trillion in revenues and KRW 2.2 trillion in operating profit in 2021.
LG Display recorded all-time high revenue in 2021 with a year-on-year increase of 23% compared to the revenue of KRW 24.3 trillion in 2020. The company’s annual operating profit surpassed KRW 2 trillion, moving it into the black in three years. These results are in large part due to the strengthening position of large-sized OLED panels in the premium TV market, solidifying its small and mid-sized OLED businesses, and structural innovation in the LCD business focusing on high-end IT products.
LG Display marked its record-high quarterly revenue of KRW 8,807 billion in the fourth quarter of 2021 with a year-on-year increase of 18% and a quarter-on-quarter increase of 22%. This is attributed to its enhanced business structure’s increased production of OLEDs and increased panel shipments for IT products. The company saw KRW 476 billion in operating profit compared to KRW 678 billion in the fourth quarter of 2020, mainly due to the decline in LCD TV panel prices and the one-off costs occurring at the end of the year.
LG Display registered KRW 180 billion in net income and KRW 1,645 billion in EBITDA along with an EBITDA margin of 19% in the fourth quarter.
Panels for TVs accounted for 27% of the revenues in the fourth quarter of 2021, panels for IT devices including monitor, laptop, and tablet accounted for 42%, and those for mobile devices and others accounted for 31%.
Despite slowing demand, LG Display will secure and stabilize its business operation by continuously focusing on minimizing market volatility caused by COVID-19. Thus, the company plans to expand its business with customers based on strategic cooperation rather than leaving the company vulnerable to market fluctuations. Furthermore, with its OLED technology, the company aims to enter new business areas such as gaming and transparent displays which will deliver new customer values and experiences.
Meanwhile, LG Display’s large-sized OLED business continued to strengthen its position in the premium market despite the overall TV market declining by 13% in 2021. OLED TV panel shipments increased by more than 70% in 2021 compared to the previous year, turning into profit in the second half and reaching a break-even point for the year. This year, the company will further expand its profitability by leveraging its strengthened business capabilities and by achieving a year-on-year growth of over 20% in panel shipments.
LG Display plans to apply its OLED.EX to all OLED TV panel series starting from the second quarter of 2022, aiming to strengthen its position in the premium TV market. The company’s newly-unveiled OLED.EX is the next-generation TV panel technology which increases brightness by 30% by applying deuterium technology and personalized algorithms to organic light emitting devices, which are the most important elements of creating OLED’s excellent picture quality. It also precisely expresses natural colors and boasts a reduced bezel thickness of 30%.
For the small and mid-sized OLED business, the company will further improve its profitability through a new model launch in the second half of the year as well as expand high-end products in the mobile sector. LG Display also aims to preoccupy the mid-sized premium OLED market through its differentiated competitiveness. In the LCD sector, it will proceed with a choose and focus strategy centered around high-end IT products.
LG Display additionally announced a dividend policy with respect to the fiscal years 2021 to 2023 and expects to maintain a dividend pay-out ratio of around 20% of its consolidated net profit to enhance shareholder value. In this regard, LG Display’s Board of Directors decided on a dividend of KRW 650 per common share, with a total dividend value of KRW 233 billion. The decision is subject to the approval of the forthcoming Annual General Meeting of Shareholders in March, 2022.
“Although the supply and demand chain may remain volatile as the effects of COVID-19 linger, we are prepared to respond to market changes and stabilize our business operations,” said Kim Sung-hyun, CFO and Senior Vice President of LG Display. “Our OLED panels have built the basis for profitable growth and we also plan to stabilize our profit structure in the LCD sector by shifting our focus to high-end IT products.”
