SEOUL: South Korea’s LG Electronics Wednesday reported a 58.5 percent slump in first-quarter net profit as losses caused by currency swings in overseas markets offset profits from its record smart phone sales.
Net profit for January-March was 38.4 billion won ($35.9 million), the company said in a statement.
Operating profit dropped 36.2 percent year-on-year to 305.2 billion won, while sales remained unchanged at 14 trillion won.
The firm — the world’s second-largest TV maker — said the dramatic weakening of local currencies in Europe and emerging markets like Russia and
Brazil dealt a blow to its TV sales. The firm’s TV unit posted an operating loss of 620 million won in the first quarter, a big turnaround from an operating profit of 216.1 billion a year earlier.
LG’s bigger rival Samsung said on the same day the weakening of the euro, real and ruble currencies had a negative impact worth 800 billion won on its first-quarter earnings.
LG’s mobile unit however recorded an operating profit of 72.9 billion won, from a loss of 730 million won a year earlier, thanks to solid sales of its popular flagship smart phone G3. LG in January-March sold 15.4 million smart phones, a quarterly sales record for the firm and an increase of 26 percent from a year earlier.
“G3 continued to post brisk global sales… and sales in the North America market rose dramatically thanks to the popularity of low-end and mid-end smart phones,” it said in a statement.
Total handset sales stood at 19.9 million units, up 21 percent from a year earlier.
LG shares rose 0.33 percent to close at 61,200 won in Seoul’s stock market.