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LG Electronics Q2 Profit Down

Seoul, South Korea – LG Electronics
saw net profit decline by 33 percent in the fiscal second quarter, to 856
billion won from 1.28 trillion won in the same period last year.

Overall sales were down 0.7 percent
in the quarter, and operating profit plunged 90 percent from the year-ago
period, coming in at 126.2 billion won.

While sales of TVs and plasma panels
rose 19 percent in the quarter and the home entertainment unit remained in the
black, the division’s operating profit declined sharply, to 28.1 billion won
from 267.8 billion won in last year’s Q2. Sales topped 5.3 trillion won.

LG cited declining average selling
prices as a result of competition among set makers for the decreased

LG’s mobile communications division
reported a sales decline of 29.5 percent year to year, leading to an operating
loss of 133 billion won.

Broken out, handset sales slipped
30.8 percent year to year, for a 120 billion won loss. Handset sales grew 7.4
percent quarter to quarter.

One bright spot for the company was
the home appliance unit, which posted a healthy 16.5 percent growth in sales
year to year and a profit of 185 billion won, up from 178 billion won a year

Sales for LG’s air conditioning
division were basically flat year to year, and profit dipped to 59 billion won
from 152 million won a year ago. The company said AC sales were strong in North
America but a cooler-than-usual summer in Korea and the cloudy financial
picture in Europe weakened overall sales.

 The company’s business solutions unit finished
Q2 in the red despite a 14.7 percent sales increase over last year’s quarter.