Anda di halaman 1dari 22

2Q12 Earnings Release

2012 th 2012 July 25 2 1


0

All information regarding management performance and financial results of LG Electronics (the Company) during the 2nd quarter of 2012 as contained herein has been prepared on a consolidated basis in accordance with International Financial Reporting Standards (IFRS). In addition, the information regarding results of 2nd quarter of 2012 has been prepared in advance, prior to being reviewed by outside auditors, solely for the convenience of investors of the Company, and is subject to change in the process of final reviewing by outside auditors. The information contained herein includes forward-looking statements in respect to future plans, prospects, and performances of the Company as well as the Companys projected sales plan for 3rd quarter of 2012. These forward-looking statements also refer to the Companys performance on consolidated base, as indicated. The aforementioned forward-looking statements are influenced by changes in the management environment and relative events, and by their nature, these statements refer to uncertain circumstances. Consequently, due to these uncertainties, the Companys actual future results may differ materially from those expressed or implied by such statements. Please note that as the forward-looking statements contained herein are based on the current market situation and the Companys management direction, they are subject to change according to the changes in future market environment and business strategy. The information contained herein should not be utilized for any legal purposes in regards to investors investment results. The Company hereby expressly disclaims any and all liability for any loss or damage resulting from the investors reliance on the information contained herein.

Table of Contents

. Overview . 2Q12 Results (Consolidated) . Performance and Outlook by Sector

. Overview

Comment on 2Q12 Results

Comment on 3Q12 Outlook

2Q12 Results

. 2Q12 Results (LGE Consolidated)


Sales
(Unit : KRW tn)

Sales/Profit

Profit
(Unit : KRW bn)

10.6%

14.39

1Q12

QoQ

2Q12

YoY

2Q11

12.23

5.2%

12.86
Operating Profit 448
99bn

349

191bn

158

EBITDA

769

97bn

672

208bn

464

Net Profit

243

84bn

159

50bn

109

1Q12

2Q12

2Q11 2

. 2Q12 Results (LGE Consolidated)


Net Profit
(Unit : KRW bn)

Net Profit

Investment Income
(Unit : KRW bn)

36

Investment income Net financial expense LG Display

1Q12 -56

2Q12 -42

77

77 349

Tax LG Innotek

-9

-4

159

Others

140

10

Investment Income Op. Profit Net Profit

75

-36

. 2Q12 Results (LGE Consolidated)

Cash Flow Statement

1Q12 Cash In Cash Out


FX effect from foreign currency denominated cash Increase in working capital
Cash at beginning of period Cash flow from operating activities

2Q12
2,607 205 159 323 36 -641 328 -214 -223 -70 -416 -56 -361 -61 -486 2,121

2,345 501 243 321 -75 301 -289 -89 -260 -61
-181

61 Others 328

Net income Depreciation Investment income Increase in working capital Others Cash flow from investing activities Increase in tangible assets Increase in intangible assets Cash flow from financing activities Dividend payment and others

Investment income Depreciation

36

641

323

159

Cash flow from investing activities 214

Decrease in debt FX effect from foreign currency denominated cash Net changes in cash Cash at end of period

9 -190 31 262 2,607

Net *
70

Net Profit

*Net= Excluding Cash flow from financing activities

. 2Q12 Results (LGE Consolidated)


Balance Sheet
(Unit: KRW tn)

Financial Structure

Financial Ratio
(Unit : %)

4Q11 Assets Current Assets Cash Inventory Non-Current Assets Liabilities Current Liabilities Non-Current Liabilities Equity Debt Net Debt 32.66 15.78 2.35 4.95 16.88 19.51 14.21 5.30 13.15 7.44 5.09

1Q12 32.40 15.77 2.61 4.90 16.63 19.01 13.38 5.63 13.39 7.25 4.64

2Q12 32.10 15.54 2.12 4.76 16.56 Total Liability to Equity

4Q11

1Q12

2Q12

148 142 140

57

18.72 13.62 5.10 13.38 6.86 4.74

Debt to Equity

54

51

39

Net Debt to Equity

35

35

Performance and Outlook

III. Performance and Outlook by Sector


Consolidated Sales and Profit by Division
(Unit : KRW bn)

Sales/Profit

1Q12 Home Entertainment Mobile Communications Handset Home Appliance Air Conditioning & Energy Solution Sales Op. Profit Sales Op. Profit Sales Op. Profit Sales Op. Profit Sales Op. Profit 5,330 217 2,497 39 2,452 35 2,536 152 1,218 81

QoQ 2.8%

2Q12 5,478 216

YoY 5.8%

2Q11 5,819 98

7.0%

2,321 -57

28.5%

3,246 -54

6.8%

2,286 -59

28.6%

3,200 -55

13.4%

2,875 165

2.6%

2,801 59

21.1%

1,475 70

11.1%

1,660 60

* Divisional sales includes internal transactions between divisions

III. Performance and Outlook by Sector


2Q12 Performance
Business Performance
(KRW tn)

Home Entertainment

Sales : Increased QoQ due to stronger premium product sales and growth in the developing countries
LCD TV : Grew QoQ from stronger 3D TV and LED TV sales
3.9%

Op. Margin

4.1% 1.8% 1.5%

IT : Declined due to weak demand in IT products

1.7%

Profitability : Slightly declined QoQ due to unfavorable FX movements but improved YoY due to increased premium product sales, cost reduction, and improvement in supply chain management

Sales

3Q12 Outlook
5.82 5.74 6.63 5.33 5.48

Market : In spite of negative growth in demand in the first half, expect demand to increase YoY especially for TVs in the developing markets LGE : Will strive to continuously improve profitability and aggressively promote the Cinema 3D TV to strengthen the top tier position in 3D TVs

2Q11

3Q'11

4Q'11 1Q12 2Q12

III. Performance and Outlook by Sector


2Q12 Performance
Business Performance
(KRW tn)

Mobile Communications

Revenue : Shipments declined 4% QoQ to 13.1M units and revenue decreased 7% QoQ to KRW 2.3 trillion Despite revenue decline as a result of falling feature phone sales, smartphone shipments and revenue portion increased on the back of strong LTE phone sales Profitability : Although cost structure improved due to better product mix from stronger LTE phone sales, operating profit declined as a result of increased marketing expense

Op. Margin

1.6% 0.4%

-1.7% -2.4% -5.0%

Sales

3Q12 Outlook
Market : Overall smartphone demand is expected to increase, especially for LTE phones, and competition to intensify with competitors launching premium flagship models LGE : Plan to continuously launch new LTE models in the developed markets and increase revenue with marketing efforts and efficient supply chain management

3.25 2.76 2.78 2.50 2.32

2Q`11

3Q`11

4Q`11 1Q`12

2Q`12

III. Performance and Outlook by Sector


2Q12 Performance
Business Performance
(KRW tn)

Home Appliance

Sales : Increased 3% YoY to KRW 2.9 trillion


Korea : Declined 7% YoY due to demand decrease as a result of reduced consumer spending

Op. Margin

6.0%

5.7%

Overseas : Despite sluggish demand in China, Europe, and CS America increased 4% YoY due to growth in developing markets

2.8% 2.4%

Profitability : Operating profit improved QoQ due to better product mix and efficient cost allocation

2.1%

3Q12 Outlook
Sales

2.80

2.69

2.98

2.54

2.88

Market : Expect weak demand trend to continue in the developed markets but improved slightly compared to the decline rate in the first half LGE : Plan to increase revenue with new model launches and profitability to increase YoY as a result of a better business structure

2Q'11

3Q'11 4Q'11

1Q'12

2Q'12

III. Performance and Outlook by Sector Air-Conditioning & Energy Solution


2Q12 Performance
Business Performance
(KRW tn)

Sales : Revenue increased 21% QoQ but declined 11% YoY to KRW 1.5 trillion
Korea : Declined 20% YoY due to weak RAC sales in June

Op. Margin

6.7% 4.8% 0.2%

3.6%

Overseas : Declined 6% YoY due to continued market recession in the developed

markets and slower growth in certain developing markets

Profitability : Increased by 1.2%p YoY to 4.8% operating profit margin due to better product mix from new model launches
-5.6%
Sales

3Q12 Outlook
1.66 1.47 1.01 0.69 1.22

Market : Expect to decline QoQ due to unfavorable demand in the developed markets and weak seasonality

2Q`11

3Q`11

4Q`11 1Q`12

2Q`12

LGE : - Focus on profitability by launching energy efficient products - Accelerate growth in System Air Conditioner business with Variable Refrigerant Flow (VRF) products

10

http://www.lg.com

Appendix. 2012 Business Reorganization


- The Commercial Water Treatment business unit from the HA Company was transferred as an independent business unit - The PC and Car business unit, which was originally an independent business unit, was transferred to HE Company - The new business structure is effective as of December 1, 2011
- Commercial Water (to Independent Business Unit) - PC (to HE) - Car (to HE)

Home Entertainment

Mobile Communications

Home Appliance

Air-Conditioning & Energy Solution

Independent Business Unit

Home Home Entertainment Entertainment


- TV - Car & Media - IT (Monitor & PC) - CEM

Mobile Mobile Communications Communications


- Handset - Network

Home Home Appliance Appliance


- Refrigerator - Washing machine - Cooking & Cleaning - Healthcare

Air-Conditioning Air-Conditioning & Energy Solution & Energy Solution


- Residential AC - System AC (CAC, Chiller) - LED lighting

Independent Independent Business Unit Business Unit


- DS - EC (Energy Components) - Solar - Commercial Water

* Independent business units report directly to the CEO ** CEM= Chemical & Electronic Material *** Commercial Water= Water Treatment for industrial and municipal usage

11

Appendix
Income Statement

Summarized Financial Statements (LGE Parent Only) *

(Unit : KRW bn)


1Q 6,933 1,953 4,980 5,716 1,217 1,300 34 (49) 65 16 1 15 2Q 7,574 2,151 5,423 6,266 1,308 1,410 16 (87) 14 (73) (37) (36) 2011 3Q 6,924 100.0% 2,166 31.3% 4,758 68.7% 5,559 80.3% 1,365 19.7% 1,330 19.2% (6) -0.1% 29 0.4% (204) -2.9% (175) -2.5% (52) -0.8% (122) -1.8% 2012 4Q 6,667 1,905 4,762 5,512 1,155 1,301 (47) (193) 22 (171) (37) (134) 100.0% 28.6% 71.4% 82.7% 17.3% 19.5% -0.7% -2.9% 0.3% -2.6% -0.5% -2.0% Total 28,097 100.0% 8,175 29.1% 19,922 70.9% 23,053 82.0% 5,044 18.0% 5,340 19.0% (3) 0.0% (299) -1.1% (103) -0.4% (402) -1.4% (125) -0.4% (278) -1.0% 1Q 6,237 100.0% 2,090 33.5% 4,147 66.5% 4,955 79.4% 1,282 20.6% 1,214 19.5% 44 0.7% 112 1.8% 281 4.5% 393 6.3% 77 1.2% 316 5.1% 2Q 6,600 100.0% 2,009 30.4% 4,591 69.6% 5,001 75.8% 1,599 24.2% 1,385 21.0% (96) -1.4% 118 1.8% 16 0.2% 134 2.0% 20 0.3% 113 1.7%

Sales Domestic Export Cost of goods sold Gross profit Selling & admin expense Other operating gain (Loss) Operating income (Loss) Financial income (Expense) Net profit (Loss) before tax Tax Net profit (Loss)

100.0% 28.2% 71.8% 82.4% 17.6% 18.8% 0.5% -0.7% 0.9% 0.2% 0.0% 0.2%

100.0% 28.4% 71.6% 82.7% 17.3% 18.6% 0.2% -1.1% 0.2% -1.0% -0.5% -0.5%

* Since this is not an audited nor reviewed report, content may be changed in the future if an auditor has a concern.

12

Appendix
Balance Sheet

Summarized Financial Statements (LGE Parent Only) *

(Unit : KRW bn)


2011 1Q Assets Current Assets Cash and cash equivalents Accounts receivable Inventory Other Non-current Assets Investment PP&E Intangible assets Other Liabilities Accounts payable Debt Other Equity 23,970 8,990 903 6,074 1,259 754 14,980 7,845 4,732 728 1,676 14,064 4,564 5,665 3,834 9,906 2Q 24,143 8,824 860 6,017 1,151 796 15,319 7,870 4,839 830 1,780 14,278 4,271 5,919 4,088 9,864 3Q 24,931 9,302 1,456 5,953 1,144 749 15,629 7,892 5,019 872 1,845 15,196 4,538 6,550 4,108 9,735 4Q 24,199 8,154 1,364 5,077 886 827 16,046 7,965 5,191 916 1,974 13,704 3,854 5,826 4,025 10,495 2012 1Q 24,335 8,458 1,409 5,135 1,018 896 15,878 7,892 5,186 906 1,894 13,573 3,936 5,722 3,915 10,762 2Q 23,510 7,616 876 4,919 1,042 780 15,894 7,918 5,171 906 1,899 12,669 3,810 4,898 3,961 10,841

* Since this is not an audited nor reviewed report, content may be changed in the future if an auditor has a concern.

13

Appendix
Income Statement

Summarized Financial Statements (LGE Consolidated)

(Unit : KRW bn)


2011 1Q Sales Cost of goods sold Gross profit Selling & admin expense Other operating gain (Loss) Operating income (Loss) Financial income (Expense) Investment income (Loss) Net income before tax Tax Net income Controlled shares Noncontrolled shares 13,160 100.0% 10,195 2,965 2,896 61 131 (37) (56) 39 54 (16) (30) 14 77.5% 22.5% 22.0% 0.5% 1.0% -0.3% -0.4% 0.3% 0.4% -0.1% 2Q 14,385 100.0% 11,078 3,307 3,193 44 158 (38) 29 150 41 109 98 11 77.0% 23.0% 22.2% 0.3% 1.1% -0.3% 0.2% 1.0% 0.3% 0.8% 3Q 12,897 9,851 3,047 2,964 (114) (32) (234) (265) (531) (117) (414) (424) 10 100.0% 76.4% 23.6% 23.0% -0.9% -0.2% -1.8% -2.1% -4.1% -0.9% -3.2% 4Q 13,814 10,934 2,880 2,804 (54) 23 (40) (40) (57) 55 (112) (113) 2 100.0% 79.1% 20.9% 20.3% -0.4% 0.2% -0.3% -0.3% -0.4% 0.4% -0.8% Total 54,257 42,058 12,199 11,856 (63) 280 (349) (331) (399) 34 (433) (470) 37 100.0% 77.5% 22.5% 21.9% -0.1% 0.5% -0.6% -0.6% -0.7% 0.1% -0.8% 1Q 12,228 9,314 2,914 2,551 85 448 (73) 75 450 207 243 236 7 76.2% 23.8% 20.9% 0.7% 3.7% -0.6% 0.6% 3.7% 1.7% 2.0% 2012 2Q 100.0% 12,859 9,574 3,285 2,778 (158) 349 (77) (36) 236 77 159 157 3 100.0% 74.5% 25.5% 21.6% -1.2% 2.7% -0.6% -0.3% 1.8% 0.6% 1.2%

* Since this is not an audited nor reviewed report, content may be changed in the future if an auditor has a concern.

14

Appendix
Balance Sheet

Summarized Financial Statements (LGE Consolidated)

(Unit : KRW bn)


2011 1Q Assets Current Assets Cash and cash equivalents Accounts receivable Inventory Other Non-current Assets Investment PP&E Intangible assets Other Liabilities Accounts payable Debt Other Equity 33,534 17,660 2,212 7,376 6,376 1,697 15,874 5,868 6,645 766 2,594 20,802 6,367 7,721 6,714 12,732 2Q 33,845 17,534 2,243 7,512 6,091 1,688 16,310 5,889 6,810 881 2,731 21,101 6,320 7,764 7,017 12,744 3Q 34,376 17,733 2,750 7,115 6,217 1,652 16,644 5,671 7,108 928 2,936 21,804 6,227 8,528 7,049 12,572 4Q 32,659 15,783 2,345 6,753 4,947 1,738 16,875 5,603 7,290 1,036 2,946 19,510 5,487 7,436 6,588 13,148 2012 1Q 32,397 15,768 2,607 6,518 4,896 1,746 16,629 5,427 7,356 1,024 2,822 19,005 5,457 7,251 6,297 13,392 2Q 32,100 15,539 2,121 7,085 4,761 1,572 16,561 5,421 7,268 1,022 2,850 18,718 5,482 6,856 6,380 13,382

* Since this is not an audited nor reviewed report, content may be changed in the future if an auditor has a concern.

15

Appendix
1Q'11
Home Entertainment Sales Op. Income (%) Mobile Communications Handset Sales Op. Income (%) Sales Op. Income (%) Home Appliance Sales Op. Income (%) Air Conditioning & Energy Solution Sales Op. Income (%) Others Sales Op. Income Total Sales Op. Income (%)

Divisional Sales (LGE Consolidated)


(Unit : KRW bn)
2Q'11 5,819 98 1.7% 3,246 -54 -1.7% 3,200 -55 -1.7% 2,801 59 2.1% 1,660 60 3.6% 860 -4 14,385 158 1.1% 3Q'11 5,740 89 1.5% 2,762 -139 -5.0% 2,689 -140 -5.2% 2,695 74 2.8% 1,006 2 0.2% 694 -58 12,897 -32 -0.2% 4Q'11 6,626 122 1.8% 2,775 12 0.4% 2,695 10 0.4% 2,978 71 2.4% 687 -38 -5.6% 749 -144 13,814 23 0.2% '11 Total 23,903 422 1.8% 11,693 -281 -2.4% 11,436 -286 -2.5% 11,081 306 2.8% 4,585 57 1.2% 2,995 -223 54,257 280 0.5% 1Q'12 5,330 217 4.1% 2,497 39 1.6% 2,452 35 1.4% 2,536 152 6.0% 1,218 81 6.7% 647 -41 12,228 448 3.7% 2Q'12 5,478 216 3.9% 2,321 -57 -2.4% 2,286 -59 -2.6% 2,875 165 5.7% 1,475 70 4.8% 709 -46 12,859 349 2.7% QoQ YoY 3% -6%

5,719 113 2.0% 2,909 -101 -3.5% 2,852 -101 -3.5% 2,607 102 3.9% 1,233 34 2.8% 692 -18 13,160 131 1.0%

-7%

-28%

-7%

-29%

13%

3%

21%

-11%

10%

-18%

5%

-11%

* Others include independent business unit earnings, other subsidiaries earnings, internal transactions, etc. * Since this is not an audited nor reviewed report, content may be changed in the future if an auditor has a concern.

16