By LG Electronics has outlined an ambitious mid-to-long-term strategy aimed at dramatically boosting its corporate value by 2030. On Tuesday, the company announced plans to achieve sales of 100 trillion won ($72.6 billion), part of its broader goal to enhance profitability and grow its business portfolio.
Triple 7 Strategy to Drive Growth
At the core of LG’s new strategy is its Triple 7 goal, which sets a clear path for the company’s growth through 2030. The key objectives include:
- 7% annual growth in sales.
- 7% operating profit margin.
- A 7x EBITDA valuation target.
To meet these goals, LG Electronics plans to expand its platform-based services and strengthen its business-to-business (B2B) capacities. The primary focus areas will be the heating, ventilation, and air conditioning (HVAC) sector and automotive parts. The company will also explore new business ventures as it seeks to diversify its revenue streams.
Platform-Based Services and B2B Expansion
LG’s expansion into platform-based services is expected to be a critical driver of its future growth. This includes the development of its web operating system and the growing presence of smart home systems, which allow consumers to manage various home devices through connected platforms.
In its regulatory filing, LG said it expects these three core business areas—platform services, HVAC, and automotive parts—to represent 52% of its sales and 76% of its operating profit by 2030. This is a significant increase from their current contribution of 39% of revenue and 55% of operating profit.
Financial Performance and Shareholder Focus
LG Electronics has set a target to achieve over 10% return on equity by 2027, signaling its commitment to improving shareholder value. To this end, the company has committed to allocating at least 25% of its consolidated net profit for shareholder returns, excluding one-time gains.
Additionally, LG will maintain a minimum dividend of 1,000 won per share, continuing its policy of semi-annual dividend payments. The company is also exploring options to further enhance shareholder value, including the possibility of canceling treasury shares and conducting share buybacks.