LG Electronics Swings into Q1 Loss on Forex Losses

LG Electronics has swung into a first-quarter loss of KRW 198 billion (US$141 million) primarily as a result of foreign exchange loss of US$224 million and equity method loss of US$150 million from overseas subsidiaries and affiliates. LG Display, in which LG Electronics has a 37.9% stake, booked an equity method loss of US$64 million.

The Mobile Communications division reported KRW 4.25 trillion (US$3.02 billion) in sales, 16.8% higher than the previous year, and operating profit of KRW 255 billion (US$181 million) with a margin of 6.0%. Handset sales accounted for KRW 3.92 trillion (US$2.78 billion), up 22.6% YoY and operating profit saw KRW 263 billion (US$187 million) at a margin of 6.7%.

LG said that sales remained strong in mid-tier models such as Cookie, a full touch screen phone, and LG-KS360, a QWERTY keypad messaging phone, among others.

Shipments of handsets recorded a decline of 7% YoY and 12% QoQ to 22.6 million units due to seasonal effect and the global market contraction.

With the global economic downturn expected to continue, LG sees the global market declining over 10% YoY to around 260 million in the second quarter. LG is targeting over 10% growth QoQ by focusing on high-tier, feature-rich products such as Arena, with a new S-Class UI, messaging phones such as Xenon and Neon, Viewty Smart, an 8 megapixel camera phone and GD900, with a transparent keypad.

Posted to the site on 21st April 2009