LG Display 2Q15 results and new fab ?3
LG Display has reported
a beat on the bottom line, despite missing slightly on the top.
Korean shares rose in response.
- Net income for 2Q15 was KRW 363b vs. average estimates of KRW
353b, up 42% YoY.
- Revenue was KRW 6708b vs. consensus of KRW 6800b, up 12% YoY.
- Operating profit was KRW 488b vs expectations of KRW 469b, almost triple from 2Q14.
This marks the fifth straight quarter of operating profit, and
affirms my opinion that the company can compete better than
smaller rivals even in a declining market. While total net
display area shipments are expected to remain flat in the third
quarter and panel prices continue to decline, LGD will "will
implement a flexible production operation and utilization
adjustment strategy" in response.
TFT-LCD panels for TVs accounted for 40% of revenue in the second
quarter of 2015, mobile device panels for 28%, tablet PCs and
notebook PCs 16%, and monitors 16%. So, as expected from recent
news, we'll have to wait until at least towards the end of the
year to see AMOLED televisions make any appreciable impact.
LGD also officially affirmed
plans to build its E5 plant for producing flexible AMOLED
displays. That's good news for UDC, as well.
Though LPL ADRs are down in early U.S. trading, I see nothing but
good here, and think the reaction is a short-sighted response to
the current LCD market. LG Display's future is simply not as tied
to that as current pricing would indicate.