SEOUL: South Korea's LG Electronics on Tuesday posted a forecast-busting first-quarter profit that more than quadrupled from a year ago as better-than-expected sales of high-end TV offset losses in the mobile phone unit.
Net profit for January to March jumped to 92.6 billion won or $89.7 million, up 319 percent from 22.1 trillion won in the same period last year, the company said.
Operating profit surged 44.2 percent to 504 billion won, beating expectations of about 400 billion won, while sales rose 1.2 percent to 14.27 trillion won.
Sales of its powerful TV unit, which takes the lion's share of LG's overall sales rose only three percent to 4.9 trillion won but its operating profit soared to 240.3 billion from 11.2 billion won a year ago.
The operating margin also jumped to 4.9 percent from 0.2 percent a year ago, boosted by cost-cutting efforts and the popularity of premium TVs, it said.
Popular high-end models include those using the new organic light-emitting diode (OLED) display technology and ultra high-definition (UHD) TVs, it said.
LG, the world's second largest TV maker after Samsung has been pushing TVs using the OLED display that is thinner, consumes less power and offers a sharper picture than conventional flat-panel sets.
The two firms have also stepped up marketing efforts for the UHD TVs that offer remarkably clearer images than other high-definition TV sets.
Sales of UHD TVs are expected to grow in the second quarter thanks to robust demand from the fast-growing market in China, LG said.
"Such high-end TVs have far greater margins over 50 percent...and LG's TV unit appears to have performed well in Chinese and US markets," Lee Min-Hee, analyst at I'M Investment & Securities, told AFP.
LG's struggling mobile unit, the world's fifth-largest handset maker racked up an operating loss of 8.8 billion won, in a turnaround from a profit of 132.5 billion won a year ago.
But the loss narrowed from the 43.4 billion won deficit posted in the last quarter of 2013.
Sales of mobile phones such as its flagship G2 smartphone rose six percent with total shipments reaching 12.3 million units, up 19 percent from a year ago.
LG's Seoul-listed shares jumped 3.91 percent to close at 71,700 won on Tuesday in the Seoul stock market. (AFP)