LG Display logs 3rd straight quarterly operating

LG Display Co., the world's second-largest maker of liquid crystal display (LCD) panels, reported Thursday a third straight quarterly operating loss for the second quarter as consumers held back TV purchases on an uncertain economic outlook. The company gave a grim outlook for the rest of the year and cut annual investment by about 20 percent, adding that the LCD industry is unlikely to make a significant improvement until early next year. The operating loss amounted to 48.3 billion won (US$45.8 million) in the April-June period, compared with a 725.9 billion won profit one year earlier, LG Display said in a regulatory filing. The figure, however, narrowed from a 79.8 billion won loss in the previous quarter. The panel maker was expected to post a 34.8 billion won operating loss, according to analysts polled by Yonhap Infomax, the financial news arm of Yonhap News Agency. Sales fell 6 percent on-year to 6.05 trillion won while net income reached 21.3 billion won, compared with a 96.2 billion won net loss one year ago. Shares of LG Display fell 0.98 percent from the previous session to 30,250 won on the Seoul bourse. LG Display, along with its bigger rival Samsung Electronics Co., has been struggling with price erosion in LCD panels as economic uncertainties, such as the debt crisis in Europe and slowdown in the U.S. housing market, delayed the revival of the TV industry. As TV vendors, the most important clients for panel makers, are reducing panel stockpiles until they see certain signals of demand revival, the LCD panel sector has been battling the industry-wide downturn for nearly two years. Samsung Electronics sacked its LCD president and merged the display business with its semiconductor business in a bid to engineer a turnaround. In June, DisplaySearch, a market research firm, cut its forecast of the global LCD TV market for this year to 210.49 million units from an earlier estimate of 216.82 million units. "It is difficult to expect a dramatic improvement in the supply-demand situation until early next year," Jeong Ho-young, the company's chief financial officer, told investors. "It's also difficult to make a significant improvement in (LG Display's) business." TV panels accounted for 48 percent of the company's revenues in the second quarter. Earlier this year, LG Display introduced a 3-D display technology called film patterned retarder (FPR) to spur fresh demand for 3-D TV, but market response was tepid except in China. LG Display plans to boost its FPR 3-D TV sales in the North American and European markets for the rest of the year, it said, while continuing to raise the portion of display panels for smartphones and tablet PCs, its CFO said. The company supplies display screens for Apple Inc.'s iPad. LG Display revised down its annual investment to 4 trillion won from 5 trillion won and plans to adjust the operation level of its production lines to brace for the downturn looming ahead, Jeong said.