Mobile phone business has been significantly improved LG's third quarter profit

According to foreign media reports, as after NOKIA, Motorola and Samsung Electronics is the world's fourth largest mobile phone manufacturer, South Korea's LG electronics in the local time this Tuesday released the 2006 third quarter financial report. The report shows that the mobile phone business improved significantly, LG third quarter profit, but the company also warned that, due to flat-panel TV business weak, fourth quarter revenue will be the basis in the third quarter fell 12%.

In the quarter ended September 30th, LG net profit of 22 billion 700 million won ($23 million 800 thousand), lower than the same period last year won 156 billion 900 million won in the first quarter of this year, the company's net loss of 9 billion 700 million won. According to the survey conducted by Reuters, analysts generally predict LG third quarter net profit will reach 8 billion won. At the same time, LG revenue reached 6 trillion and 50 billion won, higher than the same period last year, won the 6 trillion and 20 billion won in the first quarter of this year and won the second quarter of 5 trillion and 800 billion.

It is understood that the above data include LG and PHILPS jointly set up a panel joint venture LG- PHILPS operating loss in the third quarter of this year. Just last week, LG- PHILPS said the company's third quarter net loss of 321 billion won, analysts predict losses will continue until the beginning of next year.

Although analysts are optimistic about the performance of LG in the increasingly competitive mobile phone market, but LG- PHILPS will continue to put pressure on the company's profits. South Korea SH Asset Management investment institutions fund manager Kim Seong-ki said, LG- PHILPS's losses will cause a lot of stress LG profit, this situation will continue until at least the first half of next year, but the mobile phone profit rate is bound to drive future growth in operating profit.

The third quarter of this year, due to strong demand for chocolate LG mobile phone market, mobile phone business to profitability, profit margins from - 0.1% in the second quarter increased to 3.7%. At the same time, mobile phone shipments from the second quarter of this year, up to 16 million 500 thousand, up to 15 million 300 thousand. LG also predicted that the fourth quarter mobile phone shipments will be flat with this year's Chocolate phone shipments will be more than 6 million.

At the same time, LG display business profit margins also increased from 1.5% in the second quarter to 2.5% in the third quarter, but the household appliances sector's profit rate fell to 4.2%, lower than the same period last year 6.8% and 9.6% in the second quarter of this year.

In addition, LG also warned that due to the expected price and inventory adjustment led to flat screen TV sales decline, the company's fourth quarter revenue will decline to 5.3 - 5 trillion and 400 billion won. LG chief financial officer Kwon Young-soo explained that this is mainly due to seasonal weakness and the LCD and plasma industry intensified market competition, which is the main factor in the fierce market competition.

Affected by this, LG shares fell 0.17%, reaching a total of 59 thousand and 500 won. This year, LG shares fell 31.7%, which rose by 6% in the third quarter.