Sales at the UK arm of LG Electronics have been slashed by almost £100m after it lost market share and Samsung stepped up its competition.
The Surrey-headquartered division has reported a turnover of £561.4m for 2023, down from £654.3m, according to newly-filed documents with Companies House.
Its pre-tax profit was also cut from £19.7m to £9.8m in the year.
LG Electronics said its TV market share decreased from 61 per cent in 2022 to 55.6 per cent because Samsung entered the OLED space.
However, the company said that its brand value “is still high” and the release of new products with new technology in 2024 means it expects its market share to “remain strong”.
LG Electronics added that its refrigerator market share fell from 7.2 per cent to 6.3 per cent caused by a higher position in the premium segment and a fall in the average selling price from £1,163 in 2022 to £1,122.
In 2022, the business paid a dividend of £53.1m to its parent company but the directors have not recommended one for 2023.
The divisions’ UK turnover decreased from £614m to £515.2m in the year but rose from £37.4m to £42.1m in the rest of Europe.
In the rest of the world, its sales grew from £2.8m to £4m.
Inflation and geopolitics hits LG Electronics
A statement signed off by the board said: “The international geopolitical landscape, including the Russia-Ukraine war and Israel-Palestine conflict remains challenging and commodity prices continue to rise, which could lead to a resurgence of inflation.”
LG Electronics added: “Like many businesses around the world, the company has experienced negative effects from inflation.
“In 2023, our business faced a challenging business environment due to concerns about global inflation, rising interest rates, plummeting exchange rates and rising prices.
“This trend started from the second half of 2022, peaked in 2023, but gradually recovered from the second half of 2023.
“Despite sales decreasing by 14.2 per cent compared to 2022, our business fundamentals were sound.
“In 2023, high inflation had a significant impact on the overall economy.
“Interest rates rose sharply, causing an increase in the cost of living, resulting in a decrease in real wages and purchasing power for the citizens.
“It is expected that inflation will decrease in 2024 compared to the previous year, but it is important to be well-prepared due to concerns of an economic downturn caused by high interest rates.”
On its future, LG Electronics said that it forecasts its sales will “gradually recover” in 2024 but that its outlook “remains uncertain” due to high inflation and rising energy and material prices.
However, the business added that its market position “is still sound and strong”.
For 2023, the wider LG Electronics group, which is headquartered in South Korea, reported a revenue of KRW 84.2tn (£48.3bn) and an operating profit of KRW 3.55tn (£2bn).