LG Electronics' 2Q net profit falls 33 percent

LG Electronics, a top global manufacturer of flat screen televisions and mobile handsets, said second-quarter net profit fell by a third amid a decline in sales and weaker profitability for phones.

SEOUL, South Korea, AP – LG Electronics, the world's third-biggest maker of flat screen TVs, earned 856 billion won ($722.4 million) in the three months ended June 30, it said Wednesday in a regulatory filing. That was down 33 percent from a net profit of 1.28 trillion won a year earlier.
Sales in the second quarter fell a marginal 0.7 percent to 14.4 trillion won from 14.5 trillion won a year earlier.
Seoul-based LG Electronics Inc. said that sales of flat screen televisions rose 47 percent to 6.3 million sets from the year before.
Mobile phone handset sales rose 2 percent to 30.6 million units, while revenue fell 31 percent to 3.38 trillion won, the company said in the release and presentation materials for investors.
LG cited lower average selling prices in developed markets and money spent on research and development and marketing for lower profitability in its mobile communications business, which includes phones.
The company ranks No. 3 behind South Korean rival Samsung Electronics Co and Japan's Sony Corp. in flat screen TVs. It is also the world's third-largest manufacturer of mobile phones behind Nokia Corp. of Finland and Samsung, which holds the No. 2 spot.
Sales in LG's home appliance, business solutions and air conditioning businesses all rose, the company said.
Looking ahead, LG Electronics said it expects overall "modest growth" in the third quarter in line with the ongoing world economic recovery. For its home entertainment business, which includes televisions, it said sales increases would be "steady."
Shares in LG Electronics, which released results during afternoon trading, fell 3.4 percent to 100,500 won with about 40 minutes remaining in the session. The shares rose 62 percent in 2009.


Jul 31, 2010 09:45


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