LG Display projected that there could be pressure from clients to cut panel prices as memory chip prices rise. On investment in 8.6-generation IT organic light-emitting diode (OLED) panels, which a competitor has begun mass-producing, it maintained a "cautious" stance.
Lee Ki-young, head of business intelligence at LG Display, said at a conference call on the fourth-quarter and annual results on the 28th, "Rising memory chip prices could affect the display industry as higher set (finished goods) prices for IT devices lead to weaker demand," adding, "We expect pressure from clients to cut panel prices as product production expense rises." He added, "In the short term, the current (rise in memory chip prices) has limited impact on the business," but also said, "Volatility ahead is very high, so we are closely monitoring demand swings and related trends, and we will keep checking the impact."
Ahn Yu-sin, head of mid-size product planning and management at LG Display, said of investment in 8.6-generation OLED panels, "There is a lack of visibility into sufficient demand." Ahn said, "Uncertainty in external conditions that affect demand remains high, so we want to watch market conditions and make investment decisions," adding, "For tablet OLEDs, where the market has opened, we have solidified our position based on differentiated technological competitiveness at our (currently owned) 6th-generation production facilities," and "For monitor OLEDs, we are proactively responding to the rising trend in high-end demand, including gaming, through 8th-generation production facilities."
Ahn continued, "For notebook panels, we are closely reviewing the market size and the pace of demand shifting from LCD to OLED," adding, "We will maximize the use of existing infrastructure and build the technology and mass-production capabilities to prepare for the future market in a way that can secure a cost advantage even amid competition."
LG Display disclosed that last year's annual revenue came to 25.8101 trillion won, down 3% from a year earlier. While revenue dipped slightly, operating profit for the year reached 517 billion won, returning to the black on an annual basis for the first time in four years. Last year's EBITDA was 4.8711 trillion won (19% margin). Fourth-quarter revenue last year was 7.2008 trillion won, down 8% from a year earlier. Operating profit during the period was 168.5 billion won, marking a second straight quarter in the black.