LG Electronics Inc. said Thursday it swung to a net profit in the second quarter from a loss the year before on strong sales of appliances and premium mobile phones, including the Shine, AP REPORTED. The company, South Korea's largest maker of consumer appliances and a major global producer of cell phone handsets, earned 385 billion won (US$420 million; ¤304.5 million) in the three months ended June 30, according to a statement. LG posted a net loss of 9.7 billion won in the same quarter a year earlier. Total sales rose 1.7 percent to 5.9 trillion won (US$6.4 billion; ¤4.7 billion) from 5.80 trillion won a year ago. Handset sales rose 27 percent to 2.7 trillion won (US$2.9 billion; ¤2.1 billion) from the year before. LG shipped a record 19.1 million phones in the quarter for a total of 34.9 million in the first half. LG said its operating profit margin of 11.6 percent in its cell phone division was an all-time high. «There was pretty much growth in every segment,» said Steve Oh, a technology analyst at Deutsche Bank Securities, referring to LG's handsets offered in wireless technologies CDMA, GSM and WCDMA. CDMA, or code division multiple access, is used in the United States and South Korea. It is a rival standard to the dominant GSM, or global system for mobile communications, used widely in Europe. WCDMA, or wideband CDMA, is the most highly developed in terms of data transmission. LG's Shine phone stood out in CDMA and GSM, Oh said, while the company's Chocolate phone was a hot seller in the WCDMA format. The company's luxury Prada phone had yet to have much of an impact on LG's bottom line, but would likely play a bigger role in the second half of the year, he said. LG launched the Prada, produced in partnership with the Italian fashion brand, earlier this year. It features a no-button interface with the front covered by a touch-sensitive screen resembling the Apple iPhone. Sales of home appliances such as refrigerators and washing machines also gained, rising 21.4 percent on year to 3.6 trillion won (US$3.9 billion; ¤2.8 billion). Sales of digital displays, mostly televisions and computer monitors, declined 2.1 percent from the previous year to 2.7 trillion won (US$2.9 billion; ¤2.1 billion). The net profit was better than expected. The average estimate of nine analysts surveyed by Dow Jones Newswires forecast that the company would post a net profit of 236.5 billion won (US$257.8 million; ¤186.9 million). Shares in LG, which released the earnings results about 45 minutes before the stock market closed, finished 1.7 percent higher at 73,800 won (US$81; ¤58).
