Global Supplier Directory
Supplier Solutions
Whitepaper Library
Calendar of Events
Association Locator
Contents Pages
Market Research
Subscription Center

Daily News

LG Electronics Reports Q3 Profit
Oct 18, 2005
 Printable format
 Email this Article

LG Electronics Inc. reported a lower-than-expected 48.5 percent drop in quarterly net profit and cut its 2005 sales target, but analysts saw its key mobile phone business driving a recovery in earnings. Third-quarter earnings were hit by squeezed profit margins on mobile phones, a weaker performance in its flat-screen venture and costs linked to spinning off its telecom equipment unit to form a joint venture with Canada's Nortel Networks Corp.

Analysts said the South Korean firm's mobile phone division, which accounted for 43 percent of revenue in the third quarter, should improve on strong demand for high-end phones from clients including Verizon Communications Inc.

"Considering new handset line-ups expected in the coming months, the positive trend for the handset business is expected to continue into the fourth quarter," said Seo Jung-ho, a fund manager at Daehan Investment Trust Management.

LG said it expected strong phone sales in the fourth quarter, but forecast slower sales in its display division due to falling prices of some products and transfers of its production bases overseas. It cut its forecast for total 2005 sales to between 23.6 trillion to 23.8 trillion won (approx. U.S. $22.5 billion to approx. $22.7 billion), down from 28 trillion to 30 trillion won (approx. $26.6 billion to approx. $28.5 billion) it projected in January.

LG, also the world's top producer of air conditioners, earned 156.9 billion won (approx. $149.7 million) in net profit for the quarter ended Sept. 30, falling short of analysts' forecasts of a 220 billion won (approx. $209.2 million) profit. That compared with a profit of 304.4 billion won (approx. $290 million) a year before. The net profit rose 4.2 percent from the previous quarter's 150.6 billion won (approx. $143.2 million).

Its results were hurt by a goodwill write-off worth 89 billion won (approx. $84.7 million) after LG spun off its low-margin telecom equipment business. However, operating profit nearly doubled from the second quarter to 279.9 billion won (approx. $266.2 million) on record mobile phone sales. Third-quarter sales were 6.02 trillion won (approx. $5.72 billion), below analyst estimates of 6.04 trillion won (approx. $5.74 billion) and 6.11 trillion won (approx. $5.8 billion) a year ago. (Reuters)

Back to Daily News


Daily News


Jul 25, 2014: Whirlpool Refrigerator is First Commercial Application of Polyurethane Insulation Using HFO Blowing Agent

Jul 24, 2014: Remodeling Spending to Be Slower, But Still Strong, in Early 2015

Jul 23, 2014: Whirlpool North America Reports Record Operating Profits

Jul 23, 2014: Japan Destroyed 3.6 Million KG Fluorocarbons from Commercial Refrigerators and AC

Jul 22, 2014: Lennox International Reports Record Profit in Second Quarter

More Daily News>>

RSS Feeds
Appliance Industry
Market Research


March 2014: Market Research - 62nd Annual U.S. Appliance Industry Forecast
February 2014: Appliance Magazine Market Insight: December 2013
January 2014: Market Research - Appliance Historical Statistical Review: 1954-2012
January 2014: Appliance Magazine Market Insight: November 2013

Contact Us | About Us | Subscriptions | Advertising | Home
UBM Canon © 2014  

Please visit these other UBM Canon sites

UBM Canon Corporate | Design News | Test & Measurement World | Packaging Digest | EDN | Qmed | Pharmalive | Plastics Today | Powder Bulk Solids | Canon Trade Shows