UPDATE 2-LG Elec Q3 posts solid operating profit on handsets

lunes 20 de octubre de 2008 10:36 CEST

* Q3 net profit falls 93 percent hit by losses on forex debt

* Q3 operating profit boosted by strong handset business

* Could face hurdles in 2009 but to outperform tech peers

(Adds analyst comments, updates share price)

By Marie-France Han and Rhee So-eui

SEOUL, Oct 20 (Reuters) - Strong mobile phone sales bolstered LG Electronics (066570.KS: Cotización) third-quarter operating profits, and the company looks set to weather the global economic downturn better than its rivals as a weaker Korean won makes its products more competitive.

Handset phone makers such as No. 4-ranked LG and market leader Nokia NOK1V.HE (NOK.N: Cotización) are just starting to feel the impact of the global economic crisis, which has already wreaked havoc among makers of flat screens and computer chips.

"The outlook appears to be tough through the first half next year," said Kim Ik-sang, an analyst at HI Investment & Securities. "LG's premium phone strategy worked well up to now, but as the economy weakens and consumers' incomes shrink, high-end phone sales will be hurt."

LG sold 23 million phones in the third quarter, down from a record 27.7 million phones in April-June but up 5 percent from a year earlier. Besides the impact of the weaker currency, its sales have been helped by its strong mix of products from less expensive handsets to high-margin premium phones.   Continuación...