LG Innotek performed the best ever last year thanks to the good showings of its main businesses, such as camera modules and semiconductor substrates, and the expansion of its new businesses like automotive electric parts.
On January 27, LG Innotek (CEO Lee Ung-beom) publicly announced that its sales were KRW6,466.1 billion and its operating profit was KRW314 billion last year according to the Korea International Financial Reporting Standards (K-IFRS). The figures increased by 4.1% and 130.6% over the previous year respectively. The sales were KRW1,815 billion, and the operating profit was KRW58 billion in the 4th quarter of 2014. The sales went up by 17.6% and the operating profit increased by 100.8% year on year.
The company explained that, despite the uncertainties in the market, it was possible because the camera module consolidated its leadership in the global market, and the company further reinforced the foundation for its future businesses like automotive electric parts and semiconductor substrates with the core technology convergence. In particular, the background of the big growth of the operating profit is the increased sales of high-performance and high-value-added products like camera modules with the optical image stabilization (OIS) function, flip chip (FC) and chip scale packages (CSP).
Looking at individual business divisions, the sales of the optical solution business were KRW2,746 billion, up 8.8% over the previous year. In the 4th quarter, it recorded the greatest quarterly sales of KRW937.6 billion. The sales went up by 33% year on year and by 48.2% quarter on quarter.
The substrate materials business saw its sales increase by 6.5% over the previous year to KRW1,699.3 billion. In the 4th quarter, the sales of this business rose by 21% year on year to KRW421.8 billion. Due to the influence of the off-season, the figure declined by 14.3% from the previous quarter.
The automotive electric parts business, which attracted a great deal of attention last year, saw its sales increase by 18.7% over the previous year to KRW532.5 billion thanks to the increased sales of convergence products, such as the automotive camera modules and LEDs. New orders were worth KRW1,500 billion, and the backlog was KRW4,300 billion, further reinforcing the foundation for sustained growth. In the 4th quarter, the sales went up by 24.5% year on year and by 9.3% quarter on quarter to KRW264.1 billion.
The LED business seems to be faltering. Last year the lighting products’ share of sales increased to 31.5%, and the sales of high-value-added products like the UV LED were expanded in a bid to solidify the foundation for growth, but the consensus is that it was difficult to avoid the influence of the lower selling prices of low-end products. The sales declined by 4.9% year on year to KRW1,049.3 billion, and in the 4th quarter the sales dropped by 9.9% year on year and by 22.5% quarter on quarter to KRW219.9 billion.
An LG Innotek insider said, “This year we are planning to accelerate our preparations for the future as a state-of-the-art materials and parts company by further reinforcing the competitive foundation for our main businesses like the automotive electric parts, camera modules and semiconductor substrates, and expanding into promising adjacent areas like the Internet of Things (IoT).”