SEOUL: Flat-screen maker LG Display posted a sharply narrowed quarterly loss on Friday, helped by solid demand from smartphones and tablet makers such as Apple Inc and as falling TV panel prices stabilised.
Its shares gained as much as 3.2 percent after the South Korean company expected an "early turnaround" and panel prices to stabilise further.
"LG Display is expected to further narrow its loss in the current quarter and turn around in the second quarter, helped by sales of its higher-margin products such as 3D TV panels and panels used in Apple's iPhone and iPad," said SR Kwon, an analyst at Dongbu Securities.
LG Display is a key panel supplier for Apple's popular iPad and iPhone. Apple on Tuesday reported quarterly results that blew past market expectations on record sales of iPhones and iPads.
The Korean company, which vies with home rival Samsung Electronics Co for the top position in LCD flat screens globally, is also a key panel supplier for Amazon.com Inc's Kindle Fire tablet, which showed strong sales during the year-end holiday season.
LG Display's October-December operating loss was 144.8 billion won ($129.3 million), slightly worse than a 117 billion won loss forecast in a poll by Thomson Reuters I/B/E/S.
That marked its fifth consecutive quarterly loss, but was a big improvement from a 492 billion won loss in the previous quarter and a 387 billion won loss a year ago.
Samsung Electronics on Friday posted a record $4.7 billion quarterly operating profit, driven by booming smartphone sales, and will spend $22 billion this year to boost production of chips and flat screens to pull further ahead of smaller rivals.
It also warned that LCD demand will remain subdued in the first quarter at least until March due to a weak global economy and low seasonal demand.
STABLE PRICES SEEN
"The total shipments of LG Display for the first quarter of 2012 will be similar to the fourth quarter of 2011 and prices are expected to remain stable," James Jeong, Chief Financial Officer of LG Display, said in a statement.
"Going forward, LG Display is confident about its ability to maintain its leadership with a host of differentiated products in the global display sector even in a rapidly changing market and well positioned to achieve an early turnaround."
But slack sales of TVs and computers in mature markets are set to keep an earnings recovery slow amid growing financial pressure to raise investment as LG Display prepares to mass-produce OLED (organic light-emitting diodes) displays, which are set to replace LCDs as the main panels for TVs in coming years.
Consumers in mature markets have been delaying TV purchases until the economy improves, while PC sales growth remain slack as customers are ditching PCs in favour of tablets.
Global TV shipments are forecast to grow 2 percent this year after no growth in 2011 due to soft consumer demand, according to research firm DisplaySearch.
Panels for TVs, computer monitors and laptops account for 80 percent of LG Display's revenues and the rest comes from mobile phones and tablets.
Shares in the panel maker, which also competes with AU Optronics and Chimei Innolux Corp, were trading up 1.1 percent in a wider market that was up 0.09 percent as of 0350 GMT.
LG Display shares rose 16 percent over the past three months, outperforming a 3 percent gain in the broader market.
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