LG Checks In With Record Financial Performance - InformationWeek

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4/16/2008
04:30 PM
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LG Checks In With Record Financial Performance

Record sales, profits, and units in the mobile handset division highlight the company's quarterly results.

LG Electronics on Wednesday posted record quarterly earnings, which the Korean vendor attributed to "robust sales" from its mobile handset and flat-screen TV lines of business.

LG said quarterly sales increased 16.9% from the same period a year ago to $11.75 billion, with $634 million in profit, a 5.1% point increase from a year previous.

In singling out its mobile communication division, LG noted record quarterly revenue of $3.48 billion, up more than 32% from the first quarter of 2007, thanks to strong sales of its high-end mobile devices, including its Viewty, Voyager, and Venus models. Unit sales for the quarter hit 24.4 million, with shipments to emerging markets in China and the Middle East up 36%, and WCDMA sales in the United States and Korea up 18%, the vendor reported.

Operating profit margin improved to more than 13% in LG's handset division, "due to growth in premium models and increased productivity," LG said in a statement Wednesday.

Other products, including the third model in the "Black Label" handset series, with its unique interface, touch screen, and Internet accessibility, are expected to fuel growth and margins in the next quarter, LG added.

That rosy picture stands in striking contrast to recent results and advisories from other mobile handset makers. Another Korean manufacturer, Samsung, cut its annual earnings estimate just a few weeks ago, mostly because of a global silicon market that's in a freefall. In addition, Sony Ericsson lowered its quarterly forecast in mid-March, and Mitsubishi plans to abandon the handset market entirely by the end of the year.

LG's digital display division increased sales 32.1% to $3.81 billion; LCD sales were up 82%, as were plasma (18%) and conventional monitors (33%).

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