Demand for screens used in notebook and desktop computers has been weaker than expected in the first quarter, liquid-crystal display maker LG.Philips ( LPL) said Tuesday.

The Seoul-based company expects its first-quarter LCD shipments to decline slightly from the fourth quarter. It had previously said orders would rise by a percentage in the mid-single digits.

"Although LCD TV sales remain strong, we are experiencing greater-than-expected seasonal weakness in the other product segments in this period, which affects our area shipment levels," the company said.

LG.Philips also said prices are weaker than previously estimated. In the quarter, the company expects the panel price per square meter of glass to fall by a percentage in the high-single digits in the first quarter, compared with the fourth. It had previously pegged the decline in the mid-single digits.

Despite the order and pricing shortfall, LG.Philips expects its margin on an earnings before interest, taxes, depreciation and amortization basis to be in the mid-20s, up from previous guidance for the high teens. It cited lower expenses at its fabrication facilities.

"We were able to generate a better-than-expected cost down in our fabs," the company said. "In fact, given the strong performance of our newest fab, P7, we now anticipate reporting a better EBITDA performance for the first quarter of 2006. We are particularly pleased with this, given the quarter's weaker pricing environment."

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