South Korea’s LG Electronics Inc. on Thursday flagged record third-quarter earnings that nearly doubled from the previous quarter thanks to brisk sales of premium white goods and TVs to global homebound consumers under pandemic environment.

In its earnings guidance for the third quarter ended September, LG Electronics estimated its operating profit at 959 billion won ($832 million), up 94 percent from a quarter ago and 23 percent from a year ago. Sales were projected at 16.9 trillion won, up 32 percent on quarter and 7.8 percent on-year.

Its performance like Samsung Electronics who also reported surprising third-quarter preliminary earnings on the same day exceeded market consensus of 849.9 billion won.

Shares of LG Electronics closed 2.91 percent lower at 93,300 won on profit-taking. They gained 1.8 percent to 96,100 won on Wednesday, touching the highest level in two years after May, 2018. The company’s shares shot up 129.63 percent since this year’s low of 41,850 won on March 23.

Cumulative profit by September has already exceeded 2019 annual earnings of 2.4 trillion won at 2.55 trillion won, although sales fell 3.8 percent to 44.5 trillion won to suggest better profitability.

Analysts attributed the company’s stellar results to pent-up demand for home appliances and TVs by homebound consumers around the world.

This has resulted in a sharp improvement in profitability of the company’s home appliance & air solution (H&A) and home entertainment (HE) divisions. LG Electronics’ H&A and HE divisions accounted for more than half of total revenue in the first half of this year.

Its mobile communications (MC) division is also estimated to have narrowed losses on the back of improved demand in the U.S. market. Its vehicle component solutions (VS) division also managed to reduce losses after its clients’ factories that remained shut down due to Covid-19 have recently resumed operations.

The VS division has been logging quarterly losses since the first quarter of 2016. Analysts expected VS division to swing to profit next year.

The company plans to announce detailed earnings later this month, including the performance of each business division.

By Lee Eun-joo

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