LG Electronics chief sees rise in 2009 sales

Tue Aug 4, 2009 1:52pm EDT

Related Topics

* LG CEO sees 2009 sales higher than 2008

* Says reducing gap on mobile market share "rapidly"

* Unconcerned by FX fluctuation, sees "natural hedge"

By Sabina Zawadzki KIEV, Aug 4 (Reuters) - Global sales this year at LG Electronics Inc (066570.KS) are likely to beat last year's record-breaking revenue of $44.72 billion, Chief Executive Nam Yong said on Tuesday.

The South Korean-based group posted last month a record quarterly profit on strong mobile phone and TV sales although analysts were concerned about potentially weaker margins going forward. [ID:nSEO53895]

"Global sales will be probably be better than last year. Up until now for the first half we had 16 percent more revenues than last year already," Nam told journalists at a news conference in Kiev after visiting LG's Ukrainian operations.

Nam told Reuters in an interview that the robust results and optimism was down to LG's focus on developing the lower cost end of its product line, pumping money into advertising and aiming to cut almost $3 billion in costs.

He said the budgets for brand-building and research and development of new products have both been increased by 10 percent this year.

Trailing Nokia (NOK1V.HE) and Samsung (005930.KS) on mobile phone sales, LG nevertheless sold a record 29.8 million handsets in the second quarter.

"We still have a substantial gap (between LG and Nokia) although we are reducing the gap very rapidly quite recently because of these investments into innovative products," Nam said, adding "It will take some time to catch up."

Nam also said he was not overly concerned by the fluctuations in the dollar exchange rate of the Korean won KRW=, even though LG can retain price competitiveness while the won remains weak. "We are using 37 different currencies around the world -- this is natural hedging," he said. "In fact, the appreciation against the dollar would present a better position for us as dollar demand is higher than dollar supply in our company." (Editing by Greg Mahlich)

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