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(3rd LD) LG Display's 2014 net hits 4-year high

All News 18:02 January 28, 2015

(ATTN: UPDATES with more info in paras 10,13, 16-19)
By Kim Seung-yeon

SEOUL, Jan. 28 (Yonhap) -- LG Display Co., the world's top maker of liquid crystal displays (LCD), said Wednesday it posted its highest profit in four years in 2014 on the back of a pickup in TV set demand and robust sales of Apple's new iPhone 6 series.

Net profit more than doubled to 917.4 billion won (US$852.2 million) in the January-December period of last year, compared with 418.9 billion won a year earlier, the company said in a regulatory filing.

The figure falls short of a median estimate of 986.6 billion won polled by 19 brokerages here, compiled by Yonhap Infomax, the financial news arm of Yonhap News Agency.

It marks the highest annual net income for the South Korean flat panel giant since 2010, when it logged 1.15 trillion won in net profit, before it swung to a net loss of 887.2 billion won in the subsequent year.

In the fourth quarter of 2014, LG Display's net profit reached 389.2 billion won, up more than five-fold from 70.8 billion won the previous year.

Operating profit more than doubled to 625.7 billion won from 256.9 billion won over the cited period, with revenue increasing 17.8 percent on-year to 8.34 trillion won.

The quarterly net profit was also below the market consensus of 443.7 billion won. Shares of LG Display closed down 1.23 percent to 36,050 won, compared to a 0.47 percent gain in the broader KOSPI. The results came after the closing bell.

The yearly earnings were released earlier in the day prior to the disclosure of its fourth-quarter results in compliance to a local rule.

LG Display said global demand for larger TVs increased last year, spurring more demand for LCD shipments. Upbeat sales of Apple's new iPhone 6 lineup in its first fiscal quarter have also helped the Korean company boost profit from smartphone panel sales.

"A continual trend toward larger-size panels and new product launches in the small and medium display segment contributed to the improved results," the company said in an emailed statement.

LG Display sells the bulk of its products to sister firm LG Electronics Co., a major handset maker, and counts Apple Inc. as one of its major clients.

Apple on Tuesday (U.S. time) booked a record high quarterly net income of $18 billion in the quarter ending in December, selling 74.5 million units of handsets, up 46 percent from a year ago.

LCD panels for TVs and those for mobile devices accounted for nearly 60 percent of its fourth-quarter revenue, besides others it produces for tablet PCs, monitors and laptops.

LG Display's operating profit for 2014 soared 16.7 percent on-year to 1.35 trillion won, while sales stood at 26.4 trillion won, down 2.1 percent over the cited period.

In a separate filing released along with the yearly earnings, LG Display said it will pay a dividend of 500 won per common share for 2014, or a total of 179 billion won, which also comes around for the first time in four years.

Analysts here gave a rosy picture for LG Display's 2015 outlook, citing high prospects for its OLED TVs in the premium market. The OLED technology, more advanced than LCD since it produces light without the backlight unit (BLU), is seen as the company's future growth engine.

Its high cost, a major drag for OLEDs, is expected to decline further as LG Display, the biggest OLED manufacturer in the world, will likely increase production of the high value-added component.

LG Display marketing head Song Young-kwon said in an IR session that followed the earnings announcement that the company plans to produce up to 600,000 OLED panels this year.

Apple's much-awaited wearable Apple Watch device, which CEO Tim Cook said a day earlier is due out in April, is another positive factor for LG Display.

elly@yna.co.kr
(END)

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