Strong Handset Sales Fail to Stop Profits Fall at LG

LG Electronics has reported first quarter revenues of KRW 6.03 trillion (US$ 6.43 billion), increased by 4.0% from a year earlier thanks to robust sales of premium handsets and home appliances. Operating profit was KRW 173 billion (US$184 million), compared to KRW 191 billion (US$204 million) from a year earlier primarily due to a sluggish display and media business. The Mobile Communication Company recorded sales of KRW 2.51 trillion (US$2.67 billion), 14.7% higher than a year earlier. Revenue from the handset business rose 17.8% to KRW 2.35 trillion (US$2.50 billion) from KRW 2.00 trillion (US$2.05 billion).

Consolidated sales based total shipments were 15.8 million units, compared to 14.1 million units YoY and 17.9 million units QoQ. Success of 'Shine' phone and DMB line-ups in Korea pushed up shipments 46% QoQ, and continued high demand of premium 'Chocolate' phone in GSM open-markets led a shift of 28% QoQ. Strong growth in WCDMA phones sales was realized in Korea and the United States.

LG says that operating margin was 4.7%, a bit less than 6.6% on a parent basis, but recovered from a loss of 2.6% from the first quarter of 2006."

Posted to the site on 19th April 2007