LG Energy's Q3 operating profit jumps 34.1 pc on strong US demand

Seoul, Oct 13 LG Energy Solution Limited, South Korea's leading battery maker, said on Monday that its third-quarter operating profit likely jumped 34.1 per cent from a year earlier, driven by strong sales of energy storage systems (ESSs) in the United States.

In the three months ended September, operating profit is estimated to have surged to 601.3 billion won ($422.8 million) from 448.3 billion won in the same period last year, the company said in a regulatory filing, reports Yonhap news agency.

"On top of increased ESS sales in the U.S., higher demand for small-sized cylindrical and pouch-type batteries for electric vehicles (EVs) contributed to the quarterly earnings," a company spokesperson said.

Sales, however, fell 17.1 per cent to 5.69 trillion won from 6.87 trillion won amid an overall slowdown in EV sales.

Looking ahead, LG Energy Solution expects sales of prismatic EV batteries to remain sluggish in the fourth quarter, as major automakers adjust their electrification strategies and maintain low inventory levels.

To offset weaker EV battery demand, the company said it will focus on reducing fixed costs and securing more ESS deals in the United States, leveraging its local ESS production facility.

Operating profit for the January-September period likely soared 83.3 per cent to 1.46 trillion won from 800.9 billion won a year earlier.

Sales for the nine-month period are estimated to have declined 8.5 per cent to 17.53 trillion won from 19.16 trillion won a year ago.

The company plans to announce its final earnings results for the September quarter later this month.

Meanwhile, earlier this month, the battery maker, unveiled it plans to gradually resume officials' business trips to the United States later this month, about a month after a mass detention in Georgia.

The company has suspended all trips to the U.S. after 47 of its employees and some 250 subcontractor workers were detained in a U.S. immigration raid at a construction site for a joint Hyundai Motor-LG Energy Solution battery plant on September 4, reports Yonhap news agency reported on October 2.

Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor