Benzinga | Oct 27, 2021 07:40AM EDT

LG Display Clocks 7% Revenue Growth In Q3 Aided By OLED Business, Expands Margins

* LG Display Co Ltd (NYSE:LPL) reported third-quarter FY21 revenue growth of 7% year-on-year to KRW 7.2 trillion.

* The increased shipments of its panels for IT products drove the growth.

* The gross margin expanded 560 bps to 18.1%. The operating profit rose 222% Y/Y to KRW 529 billion, with the margin expanding by 490 bps to 7.3%.

* In comparison, operating profit declined 25% Q/Q due to falling LCD TV panel prices, increased material costs due to the industry's component shortage, and increased expenses from the ramp-up of new facilities.

* The EBITDA of KRW 1.696 trillion compares to KRW 1.228 trillion Q3 2020. The margin expanded 440 bps to 23.5%.

* It held KRW 4.2 trillion in cash and equivalents at the end of the quarter.

* The company generated KRW 1.48 trillion in operating cash flow.

* LG Display's large-sized OLED business continued to strengthen its position in the market as the premium TV sector continued to grow.

* The panel shipments in Q4 are likely to increase by mid-10% compared to Q3, with the delayed shipments affected by the industry's component shortage predicted to return to normal.

* While the prices of LCD TV panels are likely to remain on a downward trend, ASP (Average Selling Prices) per square meter will likely rise slightly thanks to an increase in shipments of mobile products with higher ASP.

* Outlook: LG Display expects to achieve the annual sales goal of 8 million OLED panels and record yearly profit in 2021.

* Price Action: LPL shares closed higher by 1.97% at $7.77 on Tuesday.