LG Display posts first profit in two years on phone, tablet panels
SEOUL (Reuters) - LG Display Co Ltd reported its first quarterly profit in two years on Friday as sales of its screens used in Apple Inc's iPad and iPhone offset weak demand from TV manufacturers, the South Korean panel maker's biggest revenue source.
LG Display, which vies with Samsung Electronics Co Ltd's panel unit for the top position in liquid crystal display (LCD) flat screens globally, reported 253 billion won ($230 million) in operating profit for its July-September third quarter.
That was a tad below an average forecast for a 265 billion won profit in a poll of 13 analysts by Thomson Reuters.
The profit, LG's first after seven straight quarters of losses, compared with a 492 billion won loss a year earlier and a 26 billion won loss in the preceding three months.
"We expect profitability to improve further in the fourth quarter, as a host of new mobile devices will launch and increase panel demand," the firm said in its earnings statement.
LG said it expected LCD panel prices to remain stable in the current quarter, and its flat-screen shipments to rise by a high single digit percentage quarter-on-quarter.
LG Display shares have jumped about 37 percent in the past three months, outperforming a 6 percent rise in the benchmark KOSPI index, on expectations for better fourth-quarter earnings as the company ties its fortunes more tightly to Apple.
Barclays expects LG's revenue from panel supplies to Apple and Amazon.com Inc to jump nearly 70 percent to 2.1 trillion won worth in the fourth quarter from the third quarter, due to solid demand for the iPhone 5, iPad mini and Amazon's Kindle tablet computer.
LG's new and thinner display -- its in-cell touch screen panel, which is used in the iPhone 5 -- costs 40 percent more than that of conventional smartphone panels, according to Nomura Securities. Analysts at Korea Investment & Securities expect panel sales to Apple to rise to around 27 percent of LG's total revenue in the second half of this year from 16 percent in the first half.
Shares of LG Display closed down 1.2 percent prior to the results announcement, versus a 1.7 percent fall in the broader market. ($1 = 1098.2000 Korean won)
(Reporting by Miyoung Kim; Editing by Chris Gallagher)