REFILE-UPDATE 1-LG Display Q2 profit doubles;warns of price fall

* Q2 operating profit 726 bln won vs 744 bln won mkt fcast

* Forecasts Q3 average panel prices falling gradually

* Shares close down 3 pct at 4-month low, lag KOSPI
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SEOUL, July 22 (BestGrowthStock) – South Korea’s LG Display
(034220.KS: ) reported quarterly profit more than doubled but it
faces weaker profit growth in the second half, as TV sales lose
momentum due to uncertainty over a global economic recovery.

Though the second half is seasonally strong, LCD makers are
bracing for shrinking order books, as TV sales, which account for
more than half of the sector’s total demand, weaken on concerns a
debt crisis in Europe will crimp overall IT spending.

Strong demand from China and tight supplies of components
boosted LCD panel prices earlier this year. Prices however
started falling from June on worries of slowing demand from
Europe and China, forcing panel producers to lower production.

“We are entering the seasonally strong third quarter with
uncertainties involving the European fiscal crisis and (high LCD)
inventory,” LG Display Chief Financial Officer Jung Ho-young said
in a statement.

“Demand will grow but… panel prices will gradually fall in
the third quarter and may start stabilising or rebound from
September when (high) panel inventories are addressed.”

On Thursday, the world’s No.2 maker of liquid crystal display
(LCD), which competes with home rival Samsung Electronics Co
(005930.KS: ) and Taiwan’s Chimei Innolux (3481.TW: ) saw shipments
for the current quarter rising by a teens percentage.

“Inventories in China are a concern for me and the demand
situation in Europe does not look very good,” said Michael On,
managing director at Beyond Asset Management in Taipei.

“Prices might weaken further to the fourth quarter. The first
quarter next year could be a bottom, so from an investment point
of view, LCD shares are not good targets now.”

LCD producers are now hoping reduced production, a shift to
high-end panels such as those using light emitting diode (LED)
technology, and a recovery in demand towards the year-end holiday
season will help reverse a fall in prices.

LG Display reported a 726 billion won ($603.2 million)
operating profit in April-June versus a forecast of 744 billion
won from 22 analysts polled by Thomson Reuters I/B/E/S.

The result marked a sharp improvement from a profit of
revised 352 billion won a year ago, but fell 8 percent from in
the previous quarter, as sales of flat-screen TVs grew less than
expected during the World Cup soccer event.

Sales rose to a record 6.5 trillion won from 4.8 trillion
wona year ago and 5.88 trillion won in the first quarter. The
company is a supplier to Apple’s (AAPL.O: ) iPad tablet PC, which
has sold 3.47 million units since its April launch.

Ahead of the results, LG Display shares closed down 3.0
percent at a four-month low, lagging a 0.8 percent drop n a
broader market (.KS11: ).

Stock Market Investing

(Reporting by Miyoung Kim; Editing by Jonathan Hopfner and
Anshuman Daga)

REFILE-UPDATE 1-LG Display Q2 profit doubles;warns of price fall