LG's 3Q Results: Appliances Strong, Mobile Phones Decline Oct 29, 2010

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LG Electronics saw strong performance in home appliances and flat-panel TVs in the third quarter but also saw revenue and profit declines in its mobile phone business.

LG posted consolidated 3Q revenues of KRW 13.4 trillion (approx. US$11.3 billion), down 2% from the same period last year (up 3% USD). Net profit was KRW 8 billion (approx. $6.4 million) in the third quarter.

LG Home Entertainment Company shipped more flat panel TVs in the third quarter - 6.6 million units - than at any time in its history, and shipments in the quarter were up 37% from 3Q 2009. Home Entertainment revenues grew 9% in KRW (14% in USD) from the previous year due to improved LCD TV sales, especially in emerging markets. Sales were KRW 5.4 trillion ($4.5 billion) and operating profit was KRW 123 billion ($104 million).

LG Mobile Communications Company revenues decreased 30% year-over-year (27% USD) as a result of a decline in handset shipments across developed markets. It shipped 28.4 million handsets in the quarter for a 32% (29% USD) decline in sales year-over-year.

LG Home Appliance Company showed consistent performance with 9% (14% USD) growth year-over-year on sales of KRW 2.8 trillion ($2.3 billion) and an operating profit of KRW 67 billion ($57 million). Sales from overseas markets grew 17% (USD) from the previous year due to OEM business expansion in the North American market and peak season promotions in India and China. Continued growth is anticipated, especially in developing markets.

LG Air Conditioning Company sales increased 35% (42% USD) year-over-year to KRW 1.1 trillion ($0.9 billion) with significant growth in developing markets. The company will continue to invest in its B2B infrastructure, including commercial air-conditioners, and new opportunities for its LED lighting and solar power businesses to generate a long-term foundation for growth.

LG Business Solutions Company results were essentially unchanged with third quarter revenues of KRW 1.2 trillion ($1.0 billion). Sales of car infotainment products grew due to the recovery of the automotive market. The company expects sales and profitability growth in the coming months with upcoming launches of premium monitors, commercial displays and hotel TVs.

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