Seoul: South Korea’s LG Electronics Inc posted third-quarter net profit that beat expectations thanks to a soft local currency that boosted its price competitiveness and a strong line-up of mobile phones.
LG reported a global-basis operating profit of 850 billion won ($732.9 million) in the third quarter, up from 571 billion won a year ago. This was above a consensus forecast of 757.8 billion won, according to analysts polled by Thomson Reuters I/B/E/S.
Quarterly net profit was 807 billion won, up sharply from a year ago when it was hit hard by currency-related losses. The figure also beat a consensus forecast for a 667 billion won net profit from Thomson Reuters I/B/E/S.
The world’s No. 3 mobile phone maker is headed for a weaker fourth quarter on higher marketing costs and price competition for its bread-and-butter handsets and flat-screen TV sets.
The recent recovery in the South Korean won is also posing a threat, as the local currency’s weakness has helped LG to weather the global downturn.
Still, analysts are upbeat about a strong recovery in 2010 thanks to strong sales of new premium products, such as smartphones and TVs using light emitting diodes.
Shares in LG, which trails Nokia and Samsung Electronics Co Ltd in mobile phones, have risen 58% so far this year compared with a 47% rise in the broader market.