🚀 AI-picked stocks soar in May. PRFT is +55%—in just 16 days! Don’t miss June’s top picks.Unlock full list

Battery firm LG Energy Solution's Q4 profit up 43% on higher US output

Published 01/25/2024, 07:28 PM
Updated 01/25/2024, 10:05 PM
© Reuters. An employee walks past the logo of LG Energy Solution at its office building in Seoul, South Korea, November 23, 2021. Picture taken November 23, 2021.    REUTERS/Kim Hong-Ji

By Heekyong Yang and Joyce Lee

SEOUL (Reuters) - South Korean battery firm LG Energy Solution (LGES) posted on Friday a rise of 43% in quarterly profit, helped by increased output from its U.S. joint-venture factory with General Motors (NYSE:GM).

The supplier of Tesla (NASDAQ:TSLA), GM, Volkswagen (ETR:VOWG_p) and other automakers reported operating profit of 338 billion won ($252.40 million) for the October-December period, up from 237 billion a year earlier.

The profit is in line with a company estimate this month of 338 billion won, but exceeds a figure of 298 billion won compiled by LSEG SmartEstimate, which is weighted toward analysts who are more consistently accurate.

However, fourth-quarter profit dropped more than half from the previous quarter, due to weak demand for electric vehicles (EV) in Europe.

"A temporary slowdown of global EV battery demand growth is expected due to original equipment manufacturers' (OEMs')conservative inventory control along with continued metal price decline," LGES said in a statement. OEMs refer to automakers.

Risk factors this year would be the changing pace of EV transition plans by automakers, growing competition in Europe as well as political uncertainties, including the U.S. presidential election, it added.

LGES' forecast of this year's market outlook comes after its automaker customer Tesla warned on Wednesday of a sharp slowdown this year in sales growth.

On Thursday, Hyundai Motor (OTC:HYMTF) Co also flagged the slowing of EV market sentiment.

Revenue for the quarter fell 6.3% year-on-year to 8 trillion won.

© Reuters. An employee walks past the logo of LG Energy Solution at its office building in Seoul, South Korea, November 23, 2021. Picture taken November 23, 2021.    REUTERS/Kim Hong-Ji

Shares of LGES were trading up 2.6% in the morning trade after the quarterly results, versus a rise of 0.4% in the benchmark KOSPI.

($1=1,339.1500 won) (This story has been refiled to add dropped word 'demand' in paragraph 5)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.