SEOUL—LG Display Co. said it swung to a first-quarter net loss due to weak television demand and panel prices but forecast an improvement in the current quarter.
The company, the world's second largest flat-panel maker by sales after Samsung Electronics Co., posted a loss of 115 billion won ($105.7 million) for the three months ended March 31, compared with net profit of 649 billion won a year earlier. But the result was better than the 192 billion won loss forecast on average by analysts and its 268 billion won loss in the fourth quarter of 2010.
The results show how global panel makers have suffered from a squeeze in margins as wary consumers in the U.S. and Europe put off purchases of flat-screen televisions. However, analysts note that liquid crystal display market conditions are improving and LG Display forecast its LCD shipments would rise by a high-teen percentage in the second quarter from the first.
"We believe the stage is set for earnings recovery [for LG Display] as seasonal demand picks up. Overall, we expect LG Display to turn into black from 2Q 2011," Citigroup said in a recent note.
In the first quarter, LG Display's operating loss was 239 billion won, reversing from profit of 789 billion won a year earlier. Sales fell 8.7% to 5.366 trillion won from 5.876 trillion won.
LG Display's LCDs are used in a wide range of products from cellphones to televisions and computers, and the company is known as a major supplier of displays for Apple Inc.'s iPhone and iPad products.
Analysts say they aren't seeing any significant impact on the industry from the devastating earthquake and tsunami that struck Japan in March, but they expect the recent suspensions of Sharp Corp.'s LCD plants will result in lower global panel output, tighter inventory and a faster-than-expected price rebound.
Sharp said this month that it had suspended two of its production plants in Japan, but added it expects to resume production in early May.
Analysts also say that LG's increasing portion of premium products for three-dimensional TV panels and as well as rising demand for higher-margin panels for smartphones and tablets will help boost income.
LG Display is a flat panel unit of LG Electronics Inc. Rival Samsung Electronics will report its first-quarter earnings next week.
The company, the world's second largest flat-panel maker by sales after Samsung Electronics Co., posted a loss of 115 billion won ($105.7 million) for the three months ended March 31, compared with net profit of 649 billion won a year earlier. But the result was better than the 192 billion won loss forecast on average by analysts and its 268 billion won loss in the fourth quarter of 2010.
The results show how global panel makers have suffered from a squeeze in margins as wary consumers in the U.S. and Europe put off purchases of flat-screen televisions. However, analysts note that liquid crystal display market conditions are improving and LG Display forecast its LCD shipments would rise by a high-teen percentage in the second quarter from the first.
"We believe the stage is set for earnings recovery [for LG Display] as seasonal demand picks up. Overall, we expect LG Display to turn into black from 2Q 2011," Citigroup said in a recent note.
In the first quarter, LG Display's operating loss was 239 billion won, reversing from profit of 789 billion won a year earlier. Sales fell 8.7% to 5.366 trillion won from 5.876 trillion won.
LG Display's LCDs are used in a wide range of products from cellphones to televisions and computers, and the company is known as a major supplier of displays for Apple Inc.'s iPhone and iPad products.
Analysts say they aren't seeing any significant impact on the industry from the devastating earthquake and tsunami that struck Japan in March, but they expect the recent suspensions of Sharp Corp.'s LCD plants will result in lower global panel output, tighter inventory and a faster-than-expected price rebound.
Sharp said this month that it had suspended two of its production plants in Japan, but added it expects to resume production in early May.
Analysts also say that LG's increasing portion of premium products for three-dimensional TV panels and as well as rising demand for higher-margin panels for smartphones and tablets will help boost income.
LG Display is a flat panel unit of LG Electronics Inc. Rival Samsung Electronics will report its first-quarter earnings next week.
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