Samsung SDI Q4 profit dips; sees 2010 demand growth
* Q4 operating profit misses fcast, down 8.8 pct vs yr ago
* Swung to a net profit; sales fall by 4.5 pct
* Expects solid demand increase for PDP and batteries
* Shares extend losses after results, down 2.2 pct
(Adds details from statement, share price)
SEOUL, Jan 26 (Reuters) - Samsung SDI Co Ltd (006400.KS) posted a below-forecast operating profit on price falls in rechargeable batteries and costs from new production start-ups, but expects solid demand growth for displays and batteries in 2010.
The South Korean company is expected to make rapid improvements after a seasonally slow first quarter, as it is ramping up sales to makers of smartphones such as Nokia (NOK1V.HE), Samsung Electronics (005930.KS) and Apple (AAPL.O).
Smartphones, which offer PC functions and diverse applications, require high-resolution displays and high-capacity rechargeable batteries.
Japanese battery makers are unlikely to expand supplies aggressively in 2010, analysts say, with Panasonic Corp (6752.T) set to complete its takeover of Sanyo Electric Co Ltd 6764.T. [nTKV006313]
The plasma display panel (PDP) division looks set to benefit from China's reportedly continuous subsidies for the purchase of new home appliances, which would include PDP TVs. [nTOE5B80B1]
Samsung SDI said on Tuesday it expects lithium-ion battery market demand to increase 13 percent in 2010 from a year ago, with the global PDP TV demand seen up 10 percent this year with the World Cups due in the first half.
The maker of rechargeable batteries and plasma display panels earned a 46.7 billion won ($40.6 million) operating profit in the quarter ended December, versus 51.2 billion won a year ago and 88.1 billion won in the third quarter to September.
The consolidated-basis result missed a forecast of 55.7 billion won from Thomson Reuters I/B/E/S.
Its net profit swung to a 15.4 billion won profit from a loss of 38.9 billion won a year earlier, with sales down 4.5 percent.
Samsung SDI's plasma panel division, managed by Samsung Electronics, was in the black for the fourth quarter, the company said, after it had sufferred continued losses as rival liquid crystal display (LCD) technology dominates the market.
The global initiatives to curb greenhouse gas emissions is also likely to brighten the outlook for rechargeable batteries, going forward. Samsung SDI is set to start production of electric vehicle batteries in 2011 through its joint venture with Germany's Robert Bosch [ROBG.UL].
As for risk on the downside, the strengthening trend of the won KRW= might weaken its price competitiveness in overseas markets and dent earnings this year, analysts added.
Last Wednesday, Samsung SDI reported parent-basis 2009 results without a quarterly breakdown. [nSEL002885]
Shares in Samsung SDI extended falls to 2.2 percent as of 0501 GMT after the results, compared with a 2.1 percent loss in the wider market .KS11.
(Reporting by Kim Yeon-hee; Editing by Jacqueline Wong)
((yeonhee.kim@thomsonreuters.com; +82 2 3704 5646; Reuters Messaging: yeonhee.kim.reuters.com@reuters.net)
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