It’s fourth quarter profit reporting time and the next major company to let us know how they did will be LG Electronics, the South Korean mobile phone and appliance giant. They’ll be giving us all the gory details on Tuesday. Analysts expect that the news will be good. Quarterly profits are estimated to be 11% higher than last year. The gains have come on increased phone sales and good results in its flat screen joint venture.
The strong quarter comes at the end of a rough year for LG. They have seen their yearly profit fall in 2005 by an expected 59%. The starkly lower results came by way of a dramatic corporate reorganization caused by cutthroat handset competition and plummeting prices for flat screens. Profits for 2006 are expected to be more than double in 2005, returning them to near the same level as 2004, before the corporate changes. A challenge that faces LG and other South Korean companies, is the rapid appreciation of the Won. LG exports more than 80% of their production, so a high home currency weakens their competitiveness.