LG Electronics Australia’s latest financial report has revealed net profit after tax of AU $ 12 million, down slightly from the AU $ 13 million reported last financial year.
For the period ending December 31, 2019, the Australian branch of the South Korean technology company also reported revenue of only AU $ 860 million, down from AU $ 867 million achieved last year.
Noting its main activity consisting of importing and supplying retailers with household electronic equipment, IT equipment, and mobile phones, LG Electronics Australia took nearly AU $ 950 million from customers, a decrease of AU $ 29 million last year. Meanwhile, payments to suppliers and employees totaled AU $ 940.5 million, also down from AU $ 972 million last year.
Income tax paid during TA19 was AU $ 5.7 million, behind pre-tax profit of AU $ 18 million.
During the financial year, LG Electronics Australia had 309 employees, which burdened a business salary of AU $ 32.5 million, up slightly from AU $ 31.3 million during FY18.
LG Electronics also set aside AU $ 144,000 this year for contingency provisions, which the company explained were related to two pending legal proceedings taken against the company.
One of them is by the Australian Competition and Consumer Commission (ACCC), which produced the company ordered by the Federal Court of Australia to pay AU $ 160,000 to two consumers for refusing to provide repair, replacement, or refund for a damaged television.
Another legal process is due to a dispute with a distributor in New Zealand until 2018.
LG Electronics also noted that it was too early to estimate the financial impact of COVID-19.
“As the situation continues to change (due to changes in government policy and the business and customer reactions that have developed in it) because on the date this financial statement is authorized to be issued, the directors of the company assume that the financial impact of COVID-19 on the company’s financial statements cannot be reasonably estimated for future financial period, “the company said.
“However, the directors assume that the general economic impact arising from COVID-19 will continue to have a negative impact on consumer demand and will have an impact on the operations of many of the company’s customers and suppliers. This in turn could have a negative impact on financial results, recovery of corporate creditors, payments in advance and inventory and payment to suppliers. “
The direct parent entity of LG Electronics Australia is LG Electronics Inc. in Korea, which on Monday announced it had signed a “long-term” patent license agreement with Miele.
Under the agreement, Miele will be able to produce and sell robot vacuum cleaners using patent technology developed by LG.
This patented technology includes LG induction signal guidance and infrared induced signals that allow robotic cleaners to accurately and precisely return to their docking station for charging, and licenses relating to dust unit detection and agitator attachment technology.
A similar statement about coronavirus was made by rival Samsung Electronics from Australia as part of its full year financial report for 2019.
“Although the company expects the negative impact of COVID-19 on global economic conditions and markets will affect the company’s business, the duration and extent of the spread of COVID-19 remain uncertain at this time, and therefore the impact on the results of operations is still unknown,” Samsung Electronics said. Australia.
For the year ending December 31, 2019, Samsung Electronics Australia reported a net profit after tax of AU $ 38.5 million, which was slightly above last year’s $ 38 million.
Revenues also showed an increase of AU $ 200 million to AU $ 2.8 billion, where goods sales constituted 99% of total revenue.
The year-on-year increase in profits and revenues made the company, which employs 301 staff in Australia, pay more taxes this year, up to AU $ 18.8 million compared to AU $ 15.8 million paid during FY18.
Of the AU $ 18.8 million figure, the total current tax costs accounted for AU $ 16.5 million, compared to AU $ 25 million last year. The remaining amount is deferred tax, which decreased from the benefits of AU $ 9.4 million to the cost of AU $ 2.3 million in 2019.
For FY19, Samsung Australia quoted it as having AU $ 23.6 million in cash inflows from operating activities, more than double last year’s AU $ 10.6 million, after taking more than $ 3 billion from customers. However, the company paid about the same AU $ 3 billion to suppliers and employees.
Samsung Electronics based in South Korea is the direct and main holding company of Samsung Electronics Australia.
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