July 26, 2018 / 6:57 AM / a year ago

UPDATE 1-LG Electronics says Q2 profit climbs 16 pct, but trade rows cloud outlook

* Q2 profit 771 billion won, matches guidance

* Revenue up 3 pct year-on-year to 15 trln won

* Co says U.S. trade disputes expected to intensify

SEOUL, July 26 (Reuters) - South Korean consumer appliance maker LG Electronics Inc said second-quarter profit jumped 16 percent, helped by strong television sales, but warned U.S. trade spats with China and Europe cast a cloud on its business outlook.

The world’s second-largest TV maker said in a statement on Thursday its April-June operating profit was 771 billion won ($688 million), in line with guidance issued earlier this month. Revenue rose 3 percent from a year ago to 15 trillion won.

But LG Electronics, which competes with appliance makers like U.S. giant Whirlpool Corp, said it saw global trade disputes expanding in the third quarter, a trend that could hurt business. Whirlpool said this week the U.S. tariffs would have an impact on material costs during the second half of 2018.

The Korean firm’s TV division posted a 44 percent rise in profit to 407 billion won, with an operating margin of 10.6 percent, compared to 282 billion won a year ago. In the previous quarter it posted record profits of its TV business, due to robust sales of high profit-margin premium TVs.

Second-quarter operating profit for the appliances division stood at 457 billion won, only slightly up from 449 billion won a year ago.

Meanwhile, LG’s serial loss-making smartphone business will not likely improve for the rest of year due to weak mobile demand globally, according to analysts. The mobile division reported a 185 billion won loss, extending the unit’s losing stretch to five straight quarters. ($1 = 1,120.7000 won) (Reporting by Ju-min Park and Heekyong Yang Editing by Stephen Coates and Kenneth Maxwell)

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