LGE reports second quarter earnings

Sales and Profit

LG continued replacing its record-high quarterly sales and operating profit on both global and parent basis, thanks to stable operations from all business divisions, mainly from robust sales in handsets and flat panel TVs.

On a global basis, sales jumped 22.1% to $12.534bn and operating profit recorded $843m, which makes the profit margin at 6.7%. On a parent basis, second-quarter sales rose 22.5% to $7.120bn. Operating profit booked $625m with the profit margin of 8.8%. The company posted strong net profits of $696m, as equity method gains from earnings of its subsidiaries in overseas and investment in LG Display.

Business performances on a global basis by division are as follows;

Mobile Communications Company posted another record-high sale of $3.788bn, 34.3% up from the second quarter 2007. From handset business, the sales reached $3.695bn, 38.6% up from a year earlier. Operating profit margin improved to 13.9%, 14.4% in handset division due to growth in high-end models and improvements in operational efficiency.

Shipment of handsets also recorded the highest in unit sales as well, a total of 27.7 million mainly from North America (33%) and emerging markets including Middle East Asia, CIS and Central & South America, thanks to strong sales of "Secret", "Viewty", "Venus" and other premium phones. Secret is the third model in its Black Label Series, with highly stylish design and enriched technological features, including the slimmest 5-mega pixel camera and innovative materials.

Digital Appliance Company sales increased 4.9% to $3.721bn on year and operating margin resulted in 7.2% despite challenging business environment such as higher raw material prices, economic slowdown and US market contraction from sub-prime effect.

Digital Display Company sales jumped 37.2% to $3.683bn powered by rise in sales of flat TVs; LCD TVs 86%, plasma TVs 31% from a year earlier. PDP module sales grew 22%. Following profitability turnaround in the previous quarter, operating profit in the second quarter successfully remained profitable at $37.4m.

Sales from Digital Media Company reduced 2.1% on year to $1.201bn due to low seasonality, but operating profit and margin increased to $12.8m and 1.0% by strong effort for cost innovation.

The General Manager of LGE Amman, Mr. Kevin Cha said:

"LGE sales and performance is continuously mounting, due to the new products that we innovate to meet the demands of our customers around the globe. We hope that our sales and performance keep on mounting to keep our pioneering position on the market."