LG Electronics Q1 net profit drops 58.5%

South Korea's LG Electronics Wednesday reported a 58.5 percent slump in first-quarter net profit as losses caused by currency swings in overseas markets offset profits from its record smartphone sales.  

Net profit for January-March was 38.4 billion won ($35.9 million), the company said in a statement.

Operating profit dropped 36.2 percent year-on-year to 305.2 billion won, while sales remained unchanged at 14 trillion won.

The firm -- the world's second-largest TV maker -- said the dramatic weakening of local currencies in Europe and emerging markets like Russia and Brazil dealt a blow to its TV sales.

The firm's TV unit posted an operating loss of 620 million won in the first quarter, a big turnaround from an operating profit of 216.1 billion a year earlier.

LG's bigger rival Samsung said on the same day the weakening of the euro, real and ruble currencies had a negative impact worth 800 billion won on its first-quarter earnings.

LG's mobile unit however recorded an operating profit of 72.9 billion won, from a loss of 730 million won a year earlier, thanks to solid sales of its popular flagship smartphone G3.

LG in January-March sold 15.4 million smartphones, a quarterly sales record for the firm and an increase of 26 percent from a year earlier.

"G3 continued to post brisk global sales... and sales in the North America market rose dramatically thanks to the popularity of low-end and mid-end smartphones," it said in a statement.

Total handset sales stood at 19.9 million units, up 21 percent from a year earlier.

LG shares rose 0.33 percent to close at 61,200 won in Seoul's stock market.

The company on Wednesday also rolled out the fourth edition of its high-end flagship smartphone, the G4, with the goal of selling 12 million units globally.

"Our previous model, G3, is about to hit a 10-million sales mark soon," Cho Sung-Ha, vice head of LG's Korean marketing, told reporters, adding the firm had set the sales goal for G4 20 percent higher.

LG is one of the world's biggest makers of home appliances such as refrigerators, air conditioners and flat-screen TVs.

The firm struggled for years with sluggish sales after making a late entry into the key smartphone market, following competitors like Samsung and Apple.

But it has shown signs of revival in recent years thanks to the popularity of the G3, which has received rave reviews for its sleek design and camera capability.