S Korean electronics giants report Q1 profit dip in Vietnam

Vietnamese subsidiaries of South Korean giants LG Electronics and Samsung have reported lower after-tax profits year-on-year in the first quarter of this year.

LG Electronics Vietnam Haiphong recorded a sales revenue of KRW1,281 billion ($1.01 billion) in the first quarter of this year, up 21.4% year-on-year, but post-tax profit for the period fell 5.9% to KRW48.84 billion ($38.64 million).

The firm’s sales revenue was the third-highest among all major LG subsidiaries, behind LG Innotek with KRW4,247.3 billion ($3.36 billion) and LG Electronics U.S.A. with KRW3,408.9 billion ($2.7 billion).

Its post-tax profit was among the highest, too, after LG Innotek, LG Electronics U.S.A., LG Electronics India, LG Electronics (Tianjin) Appliances and LG Electronics Indonesia.

LG Innotek Vietnam Haiphong posted a sale revenue of KRW689.55 billion ($545.6 million), down 22.1% year-on-year, while its after-tax profit halved to KRW14.47 billion ($11.45 million).

Together, the two subsidiaries of LG Electronics in Vietnam, both in the northern city of Haiphong, recorded sales revenues of KRW1,970.6 billion ($1.56 billion), up 1.6% year-on-year; but their after-tax profits dropped 23.2% to KRW63.31 billion ($50.1 million).

Globally, LG Electronics recorded sales revenues of KRW20,415.9 billion ($16.15 billion) in the first quarter of this year, down 2.6% year-on-year. Its after-tax profit was KRW546.5 billion ($432.4 million), down 61%.

LG Electronics said the business environment was characterized by market uncertainties generated by geopolitical risks including the U.S.-China rivalry and the Russia-Ukraine conflict, as also the possibility of global economic recession caused by interest rates adjustments and monetary tightening policies.

Amid such tensions, LG Innotek, the electronic components arm of LG Electronics announced last month that it would invest an additional $1 billion in Haiphong, doubling its investment in the northern coastal city to $2.05 billion. The investment, slated for July 2023-December 2025, was an achievement of an promotion event organized June 11-14 in Seoul by Hai Phong authorities, said Le Trung Kien, head of Hai Phong Economic Zone Authority (HEZA).

The Samsung Four

Samsung's four subsidiaries in Vietnam posted after-tax profits of KRW1,407.5 billion ($1.08 billion) in the first quarter of this year, down 18.4% year-on-year, according to the South Korean tech giant's interim business report.

Samsung HCMC CE Complex (SEHC) in Ho Chi Minh City, Samsung Electronics Vietnam (SEV) and Samsung Display Vietnam (SDV) in Bac Ninh province, and Samsung Electronics Vietnam Thai Nguyen (SEVT) in Thai Nguyen province recorded revenues of KRW20,999.3 billion ($16.13 billion), down 12.6% year-on-year.

SEVT posted its worst year-on-year fall of 69.3% in after-tax profit at KRW296 billion ($227.43 million), while that of SEHC fell to KRW198.5 billion ($152.52 million), a fall of 1.82%.

SEV and SDV in Bac Ninh, meanwhile, recorded higher after-tax profits, with the former’s rising 7.9% year-on-year to KRW462.8 billion ($355.6 million); and the latter’s going up 242% to KRW450.1 billion ($345.8 million).