LG Electronics Inc, the world’s third-largest maker of mobile phones, posted earnings that beat analyst estimates and forecast higher sales in the current period on increased shipments of handsets and televisions.
First-quarter operating profit, or sales minus the cost of goods sold and administrative expenses, fell 25 percent to 455.6 billion won (US$338 million), including revenue from overseas affiliates, Seoul-based LG said in a statement yesterday.
LG said sales would probably rise more than 10 percent in the second quarter from the previous three months as the company introduces new products and wins market share.
The first-quarter net loss of 197.6 billion won compared with a profit of 422.2 billion won a year earlier after its flat-panel unit lost money and the weaker won increased the company’s foreign-debt costs, LG said.
First-quarter profit at the mobile-phone division fell 41 percent to 262.6 billion won, compared with the 233 billion won projected in the survey. Profit from mobile phones accounted for 75 percent of LG’s total operating income last year.
Shipments fell 7 percent to 22.6 million handsets, while the operating profit margin narrowed to 6.7 percent from 13.9 percent a year earlier, LG said.
Nokia, the world’s largest mobile-phone maker, last week reiterated its forecast for a 10 percent decline in industry unit sales this year. Sony Ericsson, the mobile-phone venture between Sony Corp and Ericsson AB, also said global handset shipments would shrink at least 10 percent this year.
LG’s home-entertainment division, which makes televisions and media products such as DVD players, posted a profit of 14.2 billion won, compared with a 13.3 billion won loss a year earlier.
Sales at the home-entertainment business, which was formed in December by combining the display and media product divisions, rose 19 percent to 4.3 trillion won, LG said.
The home-appliances division, which competes against products from Whirlpool Corp and Electrolux AB, posted a profit of 101.9 billion won, from 83.7 billion won a year earlier.
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