Tuesday, May 22, 2018
LG Display to Invest More Than Eight Billion Dollars this Year
Aggressive Investment
LG Display to Invest More Than Eight Billion Dollars this Year
  • By Cho Jin-young
  • January 24, 2018, 01:45
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LG Display’s capital expenditure for this year is planned to total nine trillion won (US$8.1 billion) and the company is planning to invest 20 trillion won (US$18 billion) in its OLED business until 2020.
LG Display’s capital expenditure for this year is planned to total nine trillion won (US$8.1 billion) and the company is planning to invest 20 trillion won (US$18 billion) in its OLED business until 2020.

 

A view of LG Display’s Paju plant.
A view of LG Display’s Paju plant.

 

LG Display announced on January 23 that its sales and operating profit totaled 27.79 trillion won (US$25.0 billion) and 2.46 trillion won (US$2.2 billion) last year, respectively.

Although the annual operating profit exceeded two trillion won (US$1.8 billion) for the first time, the Q4 operating profit stood at 44.5 billion won (US$40.0 million). This is because of R&D and promotion costs related to OLED panels to be supplied to new clients. This year, Sharp and Hisense joined the global OLED TV alliance. “With the alliance having the new OLED clients, R&D costs for new products were spent in advance in the fourth quarter,” the company explained.

LG Display’s capital expenditure for this year is planned to total nine trillion won (US$8.1 billion) and the company is planning to invest 20 trillion won (US$18 billion) in its OLED business until 2020. “This early investment is for timely investment and some borrowing is likely to be inevitable for financing purposes,” LG Display said, adding, “Still, there will be no paid-in capital increase for the same purpose.”

The investment goes to the OLED plant LG Display is currently building in Guangzhou, China as well as the domestic market. The Guangzhou plant is put into operation in the second half of next year. The company also said that it would pay a cash dividend of 500 per share.

LG Display is planning to sell 2.5 million to 2.8 million units of OLED TV panels this year. The company sold approximately 1.7 million units of OLED TV panels last year.

When it comes to mobile OLED panels, LG Display is currently concentrating on the stabilization of the productivity of its E5 plant. The E6 plant, which is located in Paju, Gyeonggi Province, produces plastic OLED panels starting from the third quarter of this year. Additional investments in the plants are likely to be made depending on client demands.