South Korea's LG Electronics is looking towards developing new areas of business - such as automobiles - as it reported full-year revenues down on "sluggish" TV demand and "softer" smartphone sales.
Operating profit in the October to December period in 2015 came in at 349 billion won ($301.38 million), up 27 percent from the same quarter in 2014.
But full-year operating income was 1.19 trillion won ($1.03 billion) in 2015, an almost 35 percent decrease from 2014, while revenues for the year were 56.51 trillion won, dropping 4 percent from the year before.
LG said its home appliance and air-conditioning division proved to be the "linchpin" with a rise in sales. But the South Korean electronics giant said fourth quarter revenues in its home entertainment business declined year-on-year "due to a weaker global TV market and unfavorable foreign exchange movements". LG said it believes that this year is "ripe for wider acceptance" of new OLED TVs and Super 4K Ultra HD units it has released.
The company also posted sales of 3.78 trillion won ($3.26 billion) in its mobile division, unchanged from the same period in 2014, although it was up 12 percent quarter-on-quarter. LG said it shipped a total of 59.7 million smartphone units in 2015, a slight increase from the 59.1 billion shipped in 2014. The division reported a fourth quarter operating loss of 44 billion won, compared with a 78 billion won loss in the previous quarter.
"The smartphone marketplace is expected to be increasingly competitive in 2016 due to anticipated premium models from competitors and further price competition within the mass tier space. The introduction of two new flagship models and a more cost-competitive value chain is expected to improve profitability in 2016," LG said in a statement.
Like many electronics companies, LG is looking to diversify away from just its core businesses and one bright spot for the company was its vehicle components division, which saw a 9 percent quarter-on-quarter rise to 520.4 billion won ($449.4 million). This was due to the growing demand for in-car mapping and entertainment systems, with revenues growing each quarter of 2015.
LG signed a deal last year to provide the parts for General Motors' upcoming electric car, Chevrolet Bolt EV, as technology firms look to take a slice of the growing connected and electric vehicle market. The South Korean firm said its bullish on this sector.
"LG expects the smart car and electric vehicle component business to grow measurably in 2016, highlighted by the LG-General Motors joint development of the Chevrolet Bolt electric car, which LG plans to leverage to support additional such partnerships," the company said.
Earnings were reported after the close of the Korean stock market. LG Electronics shares were down 3.52 percent at the close and before earnings were released.