LG Display Reports Q2 2018 Results

LG Display reported unaudited earnings results based on consolidated K-IFRS (International Financial Reporting Standards) for the three-month period ending June 30, 2018.
 
Revenues in the second quarter of 2018 decreased by 1% to KRW 5,611 billion ($4.95 billion) from KRW 5,675 billion in the first quarter of 2018 and decreased by 15% from KRW 6,629 billion in the second quarter of 2017.
 
Operating loss in the second quarter of 2018 recorded KRW 228 billion ($201 million). This compares with the operating loss of KRW 98 billion in the first quarter of 2018 and the operating profit of KRW 804 billion in the second quarter of 2017.
 
EBITDA in the second quarter of 2018 was KRW 681 billion ($601 million), compared with EBITDA of KRW 812 billion in the first quarter of 2018 and with EBITDA of KRW 1,583 billion in the second quarter of 2017.
 
Net loss in the second quarter of 2018 was KRW 301 billion ($266 million), compared with the net loss of KRW 49 billion in the first quarter of 2018 and with the net income of KRW 737 billion in the second quarter of 2017.
 
LG Display recorded KRW 5,611 billion in revenues and KRW 228 billion in operating loss in the second quarter of 2018 due to a continued and steep decline in panel prices and lower demand in panels driven by set makers’ conservative purchasing strategy.
 
Panels for TVs accounted for 42% of the revenue in the second quarter of 2018, mobile devices for 22%, tablets and notebook PCs for 19%, and desktop monitors for 17%.
 
LG Display will focus more on differentiated LCD features and technologies in the IT sector such as narrow bezel, IPS borderless, and oxide technology, as well as high-value-added products such as larger-size TV panels and commercial displays, considering that a structural oversupply in panels and fierce competition among display makers are expected to continue down the road.
 
In addition, LG Display will achieve a turnaround to profit in the OLED TV sector in the third quarter of 2018. By making its final decision to invest in its Gen 10.5 OLED panel production line in Paju, Korea, and by starting mass production in the latter half of 2019 at its Gen 8.5 OLED production line now under construction in Guangzhou, China, LG Display will accelerate the expansion of the global large-size OLED market.
 
“Panel area shipments in the third quarter are expected to increase by a mid-single digit percentage, as upcoming favorable seasonality is anticipated to drive up the sales volume. As the trend of panel prices is expected to turn positive, we anticipate seeing an increase in some panel prices, which will depend on the supply and demand situation per panel size,” said Don Kim, CFO of LG Display.
 
“LG Display will invest KRW 3 trillion less than originally planned by 2020 by adjusting the timing and amount of investment while continuing to speed up the shift toward an OLED-focused business in the mid and long term,” Kim added.