(Updates with share price in the fifth paragraph.)
Oct. 20 (Bloomberg) -- LG Display Co., the world’s second- largest maker of liquid-crystal displays, reported a record quarterly loss after panels prices dropped and the won weakened.
The net loss in the three months ended in September totaled 687.5 billion won ($600 million) compared with a 141.6 billion won average of 22 analysts’ estimates compiled by Bloomberg. The company had net income of 224.2 billion won a year earlier.
LG Display and its competitors, including bigger rival Samsung Electronics Co., are struggling to boost sales as TV makers hold back panel purchases with consumers not upgrading to new models. A depreciating won boosted overseas debt payments, causing a 150 billion won foreign exchange loss in the quarter, Chief Financial Officer James Jeong said today.
“The losses are set to continue for a while,” said Im Jeong Jae, a Seoul-based fund manager at Shinhan BNP Paribas Asset Management Co., which oversees about $29 billion. “There isn’t much to expect for a demand recovery for now.”
LG Display shares fell 0.2 percent to 22,500 won at the close of trading in Seoul today. The shares have fallen 43 percent this year.
Third-quarter operating loss was 492.1 billion won on sales of 6.3 trillion won, according to the statement.
The average price of LG’s panels fell 10 percent in the third quarter from a year earlier, according to the company.
“Demand from our customers isn’t recovering because of uncertainty about the global economy,” Jeong said at a briefing in Seoul today. “The fall in panel prices was bigger than expected.”
Global shipments of LCD TVs will rise to 206 million units this year, falling short of an earlier projection of 211 million units, research company DisplaySearch said on Oct. 11.
The company has no plan to make new investments in raising LCD display capacity.
The panel industry will probably turn around after the second quarter of next year, Jeong said. New TVs that may go on sale ahead of the London Olympic Games will also help boost sales next year, Chief Executive Officer Kwon Young Soo told reporters Oct. 12, according to Yonhap News.
CFO Jeong reiterated today that the company’s 3-D technology and mobile displays, which are used in Apple Inc.’s iPhone, will help revive sales.
LG is promoting a 3-D technology called Film Patterned Retarder, or FPR, which uses polarized glasses to view 3-D images with visual information sent to both eyes simultaneously.
“You have to do higher-margin products that others can’t do so you can ride out the waves in the industry,” Kwon Sung Ryul, a Seoul-based analyst at Dongbu Securities Co. said by telephone before today’s announcement.
--With assistance from Saeromi Shin in Seoul. Editors: Anand Krishnamoorthy, Nicholas Wadhams
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