South Korea’s LG Display Co. on Wednesday reported a 27.1 percent fall in its operating profit in the third quarter ended September from the previous three-month period due to softening in liquid crystal display (LCD) TV prices.

Against the year-ago period, operating profit soared 81.3 percent, benefiting from higher panel prices and demand for pricier organic light-emitting diode (OLED) TVs.

LG Display said in a regulatory filing that its operating profit for the July-September period fell 27.1 percent on quarter to 586.0 billion won ($519.0 million) on a consolidated basis. It, however, surged 81.3 percent against a year ago period. Its sales reached 6.97 trillion won, up 5.2 percent on quarter and 3.7 percent on year. Net profit sank 35.3 percent on quarter to 477.2 billion won.

At 1:20 p.m. on Wednesday, shares of LG Display were up 0.3 percent at 29,500 won.

The world’s top display maker enjoyed stellar profit in the first quarter due to strengthening in panel prices from late last year, but prices began to plateau from June and fizzle in the following months due to increased yield by Chinese rivals.

Panels for TV accounted for 40 percent of the company`s third-quarter sales, mobile devices 27 percent, tablets and notebook PCs for 17 percent, and desktop monitors 16 percent.

Kim Sang-don, LG Display’s chief financial officer in a conference call, predicted the company’s panel shipment by area base to grow by mid-single-digit percent in the final quarter from the third quarter on seasonal demand and inventory stocking.

Sales prices will differ by product and size, but overall are heading downwards. But the declining pace will gradually slow, he said.

“We have turned conservative on outlook and predict unfavorable market conditions. We will focus on expanding OLED segment to maximize profit,” he said.

The company expects to sell 1.7 million OLED panels this year and 2.5 million to 2.8 million next year. OLED panels will likely make up 10 percent of this year’s sales and 20 percent next year.

Of OLED panel demand for TVs next year, crystal sound and wallpaper screens will account for 30 percent, he added.

Market watchers expect the display panel maker’s full-year operating profit for this year to near 2.8 trillion won, refreshing the previous record-high of 1.6 trillion won in 2015.

Its outlook is foggy in the transitional stage as OLED is yet to become a mainstream in the panel market while Chinese players have become more dominant in the LCD segment.

LG Display in July pledged 15 trillion won spending over the next three years in OLED manufacturing to make OLED its mainstay product for not only TVs but also mobile devices.

By Lee Dong-in and Cho Jeehyun

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]