LG Energy Solution announced it plans to reduce its capital expenditures (CAPEX) by about 3 trillion won compared to last year (13 trillion won). It also noted the possibility of financing through corporate bond issuance.
During the fourth-quarter earnings conference call held on the 24th, LG Energy Solution stated, "We will adjust the pace of new investments and increase the utilization of existing production bases. The CAPEX will gradually decrease."
Regarding investment financing methods, it said, "We will primarily utilize internal funds generated from operations, but external financing such as borrowing is also planned if necessary. This year, we are considering financing through corporate bond issuance at a scale similar to last year."
It also added, "In the case of our North American subsidiary, we plan to secure investment funds at low interest rates through policy loans."
LG Energy Solution recorded 6.4512 trillion won in sales and an operating loss of 225.5 billion won in the fourth quarter of last year. Compared to the fourth quarter of 2023, sales decreased by 19.4%, and the company switched to a deficit. This marks the first quarterly loss in over three years since the third quarter of 2021.
The operating profit for the fourth quarter of last year included a tax credit for advanced manufacturing production costs amounting to 377.3 billion won under the U.S. Inflation Reduction Act (IRA). Excluding this, the operating loss for the fourth quarter of 2024 is 602.8 billion won, with an operating margin of -9.3%.
For the entire year of 2024, sales are projected to be 25.6196 trillion won, with an operating profit of 575.4 billion won. Compared to the previous year, sales decreased by 24.1%, and operating profit dropped by 73.4%.