SEOUL, Oct 8 : South Korean battery maker LG Energy Solution said on Thursday the company expects its July-September operating profit to rise 25.7 per cent to 756 billion won ($564.09 million).
That compared with an LSEG SmartEstimate forecast for an operating profit of 309 billion won, which is weighted toward analysts who are more consistently accurate.
Here are some details:
• LGES, which supplies Tesla, General Motors and Hyundai Motor among others, has been grappling with a prolonged slowdown in EV demand.
Guess WordCrack the word, one row at a timeBuzzwordCreate words using the given lettersMini SudokuTiny puzzle, mighty brain teaserMini CrosswordSmall grid, big challengeWord SearchSpot as many words as you can Show More Show Less• Revenue likely rose 59 per cent to 9.6 trillion won from a year earlier, according to LGES' regulatory filing.
• The quarterly earnings guidance includes tax credits provided under the US Inflation Reduction Act for the company's battery production in the United States, LGES said in a statement. Excluding those credits, the company would have posted an operating profit of 339.1 billion won.
• Analysts attributed the better-than-expected operating profit to a one-off gain from a North American automaker, which paid compensation for falling short of minimum purchase commitments amid weak EV demand.
• To offset weakness in the EV market, LGES has been expanding its energy storage system (ESS) business, where demand is being supported by rising electricity needs from artificial intelligence data centres.
• Analysts said AI-driven data centre demand for ESS is emerging as a growth driver for battery makers. However, they cautioned that LGES' ESS business remains loss-making and that the timing of a turnaround has been pushed back.
• LGES said it plans to announce detailed quarterly results on November 3.
($1 = 1,340.2200 won)