South Korea’s LG Display Co. is adjusting investment plans as it turns negative about market prospects weighed down by softening in panel prices from concerns of supply glut due to increased capacity in China and stagnancy in the smartphone market after it reported its first loss in six years.

The world’s largest display maker in a regulatory filing on Wednesday said it posted an operating loss of 98.3 billion won ($91.4 million) for the first quarter ended March, deteriorating from a profit of 44.48 billion won in the previous quarter and sharply from a profit of 1.02 trillion won a year ago. The last time it booked a loss was in the first quarter of 2012.

The company would adjust investment plans and enter cost-cutting efforts as it expects a softening in panel prices to continue throughout the year to result in underperformance of this year’s target, said its chief financial officer.

“The market situation changed more rapidly than expected, but we are prepared,” said Kim Sang-don, LG Display’s chief financial officer.

Earlier this year, the company vowed to make OLED its mainstay turnout by 2020 and cement its leadership in the next-generation TV screens by investing 20 trillion won over next few years.

This year’s spending could slightly fall below original capex budget of around 9 trillion won, and next year’s plans to expand flexible OLED capacity and 10.5-gen transition also depend on the market conditions, he added.

Sales slipped 20.4 percent on quarter and 19.6 percent on year to 5.68 trillion won.

LG Display shares finished Wednesday down 0.2 percent at 24,700 won.

Increased capacity from Chinese panel makers coupled with the traditionally slow season for IT products ate into the bottom line of the Korean display producer. Shipments of small and mid-sized OLED panels fell as phone makers pushed back the release of new models amid global slowdown in the smartphone market.

Sales of large OLED panels for TVs stayed robust.

By Chun Gyung-woon and Cho Jeehyun

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]