UPDATE 1-LG Display may resume output cuts this year -CEO

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By Rhee So-eui

PAJU, South Korea, March 13 (Reuters) - LG Display Co Ltd (034220.KS), the world's No. 2 maker of LCD screens, may resume output cuts this year if Taiwanese rivals boost production, weighing on the still-fragile market, its CEO said on Friday.

LG Display has seen its plant utilisation recovering to close to full levels recently after a sharp output reduction late last year, helped by solid demand from China.

But chief executive Kwon Young-soo remained cautious on the industry outlook, saying that he could see another round of output cuts.

"When Taiwanese makers increase production again, there could well be another round of output cuts," Kwon told reporters on the sideline of the company's annual shareholder meeting.

"(Panel) prices are not falling further, but it is difficult to expect a rise," Kwon said.

As the global recession hits electronics sales, leading LCD makers swung to losses in October-December and slashed output to control supply.

Growing flat-screen TV sales in China have helped the industry to stablise, as falling prices bolster demand in smaller cities and rural areas.

Kwon said the decision by former shareholder Philips to offload its entire stake in LG Display would not affect panel sales to the Dutch electronics maker, a key client for LG Display's TV panels.

"There will be no impact at all. We will have a stronger, business-focused relationship."

Philips Electronics (PHG.AS) sold off on Wednesday its remaining 13.2 percent stake in LG Display for 630 million euros ($813.2 million) to move away from cyclical businesses. [ID:nLB482485]

"This will probably resolve overhang concerns," Kwon said, expressing optimism for LG Display's share price outlook.

LG Display was up 4.05 percent as of 0237 GMT, versus the benchmark index's 0.24 percent rise. ($1=.7747 Euro) (Reporting by Rhee So-eui; Editing by Jonathan Hopfner)