Phones, Flat-Panel TVs Spark LG's Profit

LG Electronics Inc., the world's fifth-largest manufacturer of mobile handsets, said in a statement that it earned 621.3 billion won ($654.2 million) for the three months ended Dec. 31. LG posted net profit of 49 billion won in the same quarter of 2006.

Sales during the quarter rose 6.4 percent to 5.87 trillion won ($6.18 billion), up from 5.52 trillion won a year earlier, LG said.

The company sold a record 23.7 million handsets in the final three months of last year, led by stronger sales in developed markets such as the United States and Europe. LG said it expects shipments of 100 million handsets in 2008 for a 25 percent increase over 2007.

LG, which manufactures a variety of products including household appliances, personal computers and televisions, painted a mixed picture overall for 2008.

"Demand is expected to slow down in the U.S. due to subprime issues, but we see continuous growth in the European and emerging markets," Jung Do-hyun, LG's chief financial officer, told analysts. "But we expect to continue to improve market leadership and profitability in key areas of handsets, digital media and home appliances."

Earnings also benefited from what LG termed a "remarkable turnaround" in LG.Philips LCD Co., in which it owns a 37.9 percent stake.

LG.Philips LCD, the world's second-largest maker of liquid crystal display panels, said earlier this month that it posted record quarterly net profit in the fourth quarter of 2007 on improved panel prices, an increase in shipments and lower costs. It had posted a loss in the last quarter the year before.

Shares in LG, which released earnings results about an hour before the stock market closed, gained 2.8 percent to finish at $98.