LG Display is planning investments of about 3 trillion won this year, compared to 5.2 trillion won in 2022. LG Display said it will conservatively maintain existing production.
LG Display said revenues decreased 17 percent to KRW 7,302 billion in Q4 2022 from KRW 8,807 in the fourth quarter of 2021.
South Korea-based LG Display reported operating loss of KRW 876 billion in the fourth quarter of 2022 against operating profit of KRW 476 billion in the fourth quarter of 2021.
LG Display’s EBITDA in the fourth quarter of 2022 was KRW 209 billion, compared with EBITDA of KRW 391 billion in the third quarter of 2022 and with EBITDA of KRW 1,645 billion in the fourth quarter of 2021.
LG Display posted net loss of KRW 2,094 billion in the fourth quarter of 2022, compared with the net loss of KRW 774 billion in the third quarter of 2022 and with the net income of KRW 180 billion in the fourth quarter of 2021.
LG Display saw a decrease in panel shipments in the fourth quarter due to worsening macroeconomic conditions, as set makers’ inventory adjustments further impacted demand in the high-end product sector which had been solid, LG Display said in its earnings report.
LG Display recorded a quarter-on-quarter increase in revenues by 8 percent thanks to increased panel shipments for mobile devices, while reporting an operating loss due to decline in mid-sized panel prices and a high-intensity action plan of utilization adjustment to decrease inventory.
LG Display said panels for TVs accounted for 25 percent of revenues in the fourth quarter, while panels for IT devices including monitors, laptops and tablet PCs accounted for 34 percent, panels for mobile and other devices accounted for 34 percent, and those for automobiles accounted for 7 percent.
“Our preemptive move to reduce the company’s inventory in the fourth quarter is expected to improve our performance down the road, and the quarterly result is also expected to improve as we continue to intensely reduce our costs,” said Sung-hyun Kim, CFO and Senior Vice President at LG Display.
The Apple supplier flagged a turnaround in the second half, pledging cost-cutting and inventory management until demand for its screens recovers later in the year.
“We engaged in intense production adjustment in the fourth quarter,” Kim Sung-hyun, CFO of LG Display said. “We expect to reduce costs by about 1 trillion won in the first quarter by reducing inventory and other activities.”
LG Display has stopped production of competition-heavy liquid-crystal display (LCD) TV panels in South Korea by end-2022 and reduced LCD TV panel production in China to 50 percent of capacity this month. LG Display is adjusting factory utilization rates for its flagship OLED panels for TVs.
LG Display said it plans to boost its made-to-order business to increase stability in the face of uncertain market conditions, from 30 percent of sales currently to 50 percent of sales by 2024, including a client-ordered new smartphone panel production scheduled to be mass-produced starting second half of this year.
