SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of April 2005
LG.Philips LCD Co., Ltd.
(Translation of Registrant’s name into English)
20 Yoido-dong, Youngdungpo-gu, Seoul 150-721, The Republic of Korea
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F X Form 40-F
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submission to furnish a report or other document that the registration foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
Q1 05 Earnings Results
I. Performance in Q1 2005 – Consolidated Financial Data
(Unit: KRW B, Korean GAAP)
| Item |
Q1 05 |
Q4 04 |
Q1 04 |
QoQ |
YoY |
|||||||
| Quarterly Results |
||||||||||||
| Revenues |
2,064 | 1,933 | 2,188 | 6.8 | % | -5.7 | % | |||||
| Operating Income |
-135 | 2 | 699 | — | — | |||||||
| Ordinary Income |
-157 | 19 | 679 | — | — | |||||||
| Net Income |
-79 | 35 | 628 | — | — |
II. Event of Q1 2005 Earnings Results
| 1. Provider of Information: |
IR team | |
| 2. Participants: |
Institutional investors, securities analysts, etc. | |
| 3. Event: |
Q1 05 Earnings Results | |
| 4. Date & Time: |
4:30 p.m. (Korea Time) on April 11, 2005 in Korean | |
| 9:00 p.m. (Korea Time) on April 11, 2005 in English | ||
| 5. Venue & Method: |
1) Earnings release conference in Korean: | |
| - Conference room, Korea Exchange (21st floor, New building) | ||
| 2) Conference call in English: | ||
| - Please refer to LG.Philips LCD Co., Ltd.’s IR homepage at | ||
| www.lgphilips-lcd.com. | ||
| 6. Contact Information |
||
| 1) Head of Disclosure: |
Dong Joo Kim, Vice President, Finance & Risk Management | |
| Department (82-2-3777-0702) | ||
| 2) Main Contact for Disclosure-related Matters: | ||
| Jaeho Park, Assistant Manager, Financing Team | ||
| (82-2-3777-1053) | ||
| 3) Relevant Team: |
IR team (82-2-3777-1010) | |
III. Remarks
| 1. | Please note that the presentation materials for Q1 05 Earnings Results are attached as an appendix and accessible on LG.Philips LCD Co., Ltd.’s IR homepage at www.lgphilips-lcd.com. |
| 2. | Please note that the financial data included in the investor presentation and press release are prepared on a consolidated Korean GAAP basis only (US GAAP consolidated and Korean GAAP non-consolidated information are stated below). |
| 3. | Financial data for Q1 05 are unaudited and unreviewed and provided for the convenience of investors and can be subject to change. |
 |
The following US GAAP consolidated information and Korean GAAP non-consolidated information are included for the convenience of investors. |
| US | GAAP consolidated information |
(Unit: KRW B )
| Item |
Q1 05 |
Q4 04 |
Q1 04 |
QoQ |
YoY |
|||||||
| Quarterly Results |
||||||||||||
| Revenues |
2,064 | 1,933 | 2,188 | 6.8 | % | -5.7 | % | |||||
| Operating Income |
-126 | 14 | 708 | — | — | |||||||
| Ordinary Income |
-148 | 41 | 691 | — | — | |||||||
| Net Income |
-95 | 56 | 640 | — | — |
| Korean | GAAP non-consolidated information |
(Unit: KRW B)
| Item |
Q1 05 |
Q4 04 |
Q1 04 |
QoQ |
YoY |
|||||||
| Quarterly Results |
||||||||||||
| Revenues |
1,770 | 1,851 | 2,116 | -4.4 | % | -16.4 | % | |||||
| Operating Income |
-162 | -67 | 692 | 141.8 | % | — | ||||||
| Ordinary Income |
-163 | 20 | 678 | — | — | |||||||
| Net Income |
-79 | 35 | 628 | — | — |
| Attached: | 1) Press Release |
2) Presentation Material
LG.PHILIPS LCD REPORTS FIRST QUARTER 2005 RESULTS
SEOUL, Korea (April 11, 2005) – LG.Philips LCD (NYSE: LPL, KRX: 034220), one of the world’s leading TFT-LCD manufacturers, today reported unaudited earnings results based on consolidated Korean GAAP for the three-month period ended March 31, 2005. Amounts in Korean Won are translated into US dollars at the noon buying rate in effect on March 31, 2005, which was KRW 1,015.4 per US dollar
| • | Sales in the first quarter of 2005 increased by 7% to KRW 2,064 billion (USD 2,033 million) from sales of KRW 1,933 billion (USD 1,904 million) in the fourth quarter of 2004. Sales decreased by 6% in the first quarter of 2005 from KRW 2,188 billion (USD 2,155 million) in the first quarter of 2004 due to decreases in panel prices. First quarter 2005 sales comparisons, from both a sequential and year-on-year perspective, were also impacted by the Korean Won appreciation against the US dollar during this period. |
| • | Operating income in the first quarter of 2005 decreased to a loss of KRW 135 billion (USD 133 million) from a profit of KRW 2 billion (USD 2 million) in the fourth quarter of 2004 and from a profit of KRW 699 billion (USD 688 million) in the first quarter of 2004. |
| • | EBITDA in the first quarter of 2005 decreased by 35% to KRW 269 billion (USD 265 million) from EBITDA of KRW 412 billion (USD 406 million) in the fourth quarter of 2004. EBITDA decreased by 72% in the first quarter of 2005 from KRW 976 billion (USD 961 million) in the first quarter of 2004. |
| • | Net income in the first quarter of 2005 decreased to a loss of KRW 79 billion (USD 78 million) from a net profit of KRW 35 billion (USD 34 million) in the fourth quarter of 2004 and from a net profit of KRW 628 billion (USD 618 million) in the first quarter of 2004. |
“Despite challenging market conditions, we continue to execute and perform in line with our plans,” said Bon Joon Koo, CEO of LG.Philips LCD. “As a result of our ongoing, strong ramp-up of our sixth generation factory, ‘P6’, we grew our total net display area shipped by 24 percent in the first quarter sequentially. Our seventh generation TFT-LCD facility, ‘P7’, construction remains on track for mass production to begin in the first half of 2006. We continue to believe in the growth opportunities for the TFT-LCD industry, as LCDs evolve as the flat-panel of choice for HDTV content.”
1
First Quarter Financial Review
Revenue and Cost
Revenues decreased by 6% to KRW 2,064 billion (USD 2,033 million) in the three-month period ended March 31, 2005, from KRW 2,188 billion (USD 2,155 million) in the corresponding period of 2004 due to decreases in panel prices and the strong appreciation of the Korean Won. The effect of the overall decrease in panel prices was partially offset by an increase in the volume of large and wide panels for notebook computers, desktop monitors and TVs. The increase in volume shipments was in response to the growing market needs for large and wide flat panels, especially for large size TV panels. TFT-LCD panels for desktop monitors, notebook computers, TVs and applications accounted for 56%, 18%, 22% and 4% respectively on a revenue basis in the first quarter of 2005, compared to 53%, 27%, 15% and 5% respectively on a revenue basis in the fourth quarter of 2004.
Overall, LG.Philips LCD shipped a total of 958,000 square meters of net display area, a 24% sequential quarterly increase, with an average selling price per square meter of net display area of USD 2,085 in the first quarter of 2005. This represents a decline in the selling price per square meter of net display area of approximately 10% compared to the average of the fourth quarter of 2004, and a decline of 9% at the end of the first quarter as compared to the end of the fourth quarter of 2004.
The cost of goods sold per square meter of net display area shipped was KRW 2,177 thousand (USD 2,144) for the first quarter of 2005, down 2.3% from the fourth quarter of 2004. Total cost of goods sold increased to KRW 2,102 billion (USD 2,070 million), or 48% year-on-year and 14% compared to the fourth quarter of 2004, as a result of increased volumes shipped as well as an increase in large and wide panels, especially in the TV segment.
“While the first quarter was challenging due to the strengthening of the Korean Won and a difficult pricing environment, we did see some positive emerging trends,” said Ron Wirahadiraksa, Chief Financial Officer of LG.Philips LCD. “During this quarter, the average LCD size increased with the adoption of large and wide LCD monitors and the growing popularity of LCD TVs. To meet the increase in demand, we continue to focus on effectively using our resources to serve our customers and improve operational efficiency.”
Liquidity
As of March 31, 2005, LG.Philips LCD had KRW 1,350 billion (USD 1,330 million) of cash and cash equivalents. Total debt as of March 31, 2005, was KRW 3,030 billion (USD 2,984 million) with a net-debt-to-equity ratio of 30% compared to the 23% at the end of the fourth quarter of 2004.
During the first quarter of 2005, LG.Philips LCD issued KRW 400 billion of Korean Won-denominated fixed rate bonds. The capital raised is being used for capital expenditures.
Capital Spending
Capital expenditures, on a cash basis, in the first quarter of 2005 decreased to KRW 453 billion (USD 446 million) from KRW 473 billion (USD 466 million) in the fourth quarter of 2004, and from KRW 730 billion (USD 719 million) in the first quarter of 2004. Capital expenditures for the first quarter of 2005 were mainly used for investments in P7.
2
Utilization and Capacity
Total input capacity on an area basis increased approximately 13% in the first quarter of 2005 compared to the fourth quarter, due mainly to the ramp-up of P6. P6 averaged 55,000 input sheets per month for the first quarter of 2005.
Industry Outlook
The following expectations are based on current information as of April 11, 2005. The Company does not expect to update its expectations until next quarter’s earnings release. However, the Company may update its full business outlook, or any portion thereof, at any time for any reason.
“As we have previously stated, we expect the industry supply/demand balance will begin to stabilize and then show signs of strengthening later in the year, mainly due to the growing demand for LCD TVs,” commented Mr. Wirahadiraksa.
LG.Philips LCD expects to increase its output of net display area shipped at a double digit rate for the second quarter of 2005, compared to the first quarter of 2005, in order to meet the anticipated market growth and to satisfy customers’ needs. At the same time, due to market pricing conditions, the Company expects its ASP per square meter to decline at a single digit rate at the end of the second quarter of 2005, compared to the end of the first quarter in 2005. In terms of the EBITDA margin, the Company anticipates mid to high teens for Q2 05.
Earnings Conference and Conference Call
LG.Philips LCD will hold a Korean language earnings conference on April 11, 2005 at 4:30 p.m. Korea Standard Time on the 21st floor of the Korea Exchange (KRX). An English language conference call will follow at 9:00 p.m. Korea Standard Time (8:00 a.m. EST and 1:00 p.m. GMT). The call-in number is 1566-2256 for callers in Korea and +82-2-6677-2256 for callers outside of Korea. The confirmation number is 3777. Corresponding slides will be available at the Investor Relations section of the LG.Philips LCD website. http://www.lgphilips-lcd.com
Investors can listen to the conference call over the Internet at http://www.lgphilips-lcd.com. To listen to the live call, please go to the Investor Relations section of the website at least 15 minutes prior to the call to register and install any necessary audio software.
For those who are unable to participate in the call, a replay will be available for 30 days after the call. The call-in number is 031-810-3100 for callers in Korea and +82-31-810-3100 for callers outside of Korea. The confirmation number for the replay is 22619#.
About LG.Philips LCD
LG.Philips LCD (NYSE: LPL, KRX: 034220) is a leading manufacturer and supplier of thin film transistor liquid crystal display (TFT-LCD) panels. The Company manufactures TFT-LCD panels in a wide range of sizes and specifications primarily for use in notebook computers, desktop monitors and televisions. Headquartered in Seoul, South Korea, LG.Philips LCD currently operates six fabrication facilities in Korea and has over 14,000 employees in locations around the world.
3
For more information about the Company, please visit http://www.lgphilips-lcd.com.
LG.Philips LCD makes “Technology you can see!”
Forward-Looking Statement Disclaimer
This press release contains forward-looking statements. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events. Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Additional information as to factors that may cause actual results to differ materially from our forward-looking statements can be found in our filings with the United States Securities and Exchange Commission.
| Investor Relations Contacts: | ||
| Jay Hong (Korea) |
Monica Huang (USA) | |
| LG.Philips LCD |
Sloane & Company | |
| Tel: +822-3777-1010 |
Tel: +1-212-446-1874 | |
| Email: jay.hong@lgphilips-lcd.com |
Email: Mhuang@sloanepr.com | |
| Media Contacts: | ||
| Elliot Sloane (USA) |
Sue Kim (Korea) | |
| Sloane & Company |
Edelman | |
| Tel: +1-212-446-1860 |
Tel: + 822-2022-8239 | |
| Email: ESloane@sloanepr.com |
Email: Sue.kim@edelman.com |
4
LG.Philips LCD
CONSOLIDATED STATEMENTS OF INCOME
(In millions of KRW)
(The financial statements are based on unaudited Korean GAAP)
In millions of KRW
| 2005 |
2004 |
|||||||||||
| 1Q |
1Q |
|||||||||||
| REVENUE |
2,064,046 | 100 | % | 2,188,013 | 100 | % | ||||||
| Cost of goods sold |
(2,102,015 | ) | -102 | % | (1,418,002 | ) | -65 | % | ||||
| GROSS PROFIT |
(37,969 | ) | -2 | % | 770,011 | 35 | % | |||||
| Selling, general & administrative exp. |
(96,606 | ) | -5 | % | (70,965 | ) | -3 | % | ||||
| OPERATING INCOME |
(134,575 | ) | -7 | % | 699,046 | 32 | % | |||||
| Interest income |
8,991 | 0 | % | 3,936 | 0 | % | ||||||
| Interest expense |
(20,872 | ) | -1 | % | (17,513 | ) | -1 | % | ||||
| Foreign exchange gain (loss), net |
(9,530 | ) | 0 | % | (11,348 | ) | -1 | % | ||||
| Others, net |
(1,364 | ) | 0 | % | 5,123 | 0 | % | |||||
| Total other income (expense) |
(22,775 | ) | -1 | % | (19,802 | ) | -1 | % | ||||
| INCOME BEFORE TAX |
(157,350 | ) | -8 | % | 679,244 | 31 | % | |||||
| Income tax expense |
78,520 | 4 | % | (51,320 | ) | -2 | % | |||||
| NET INCOME (LOSS) |
(78,830 | ) | -4 | % | 627,924 | 29 | % | |||||
- These financial statements are provided for informational purposes only
LG.Philips LCD
CONSOLIDATED BALANCE SHEETS
(In millions of KRW)
(The financial statements are based on unaudited Korean GAAP)
In millions of KRW
| 2005 |
2004 |
|||||||||
| 31-Mar |
31-Dec |
|||||||||
| ASSETS |
||||||||||
| Current assets: |
||||||||||
| Cash and cash equivalents |
1,350,492 | 12 | % | 1,361,239 | 13 | % | ||||
| Trade accounts and notes receivable |
1,098,624 | 10 | % | 890,507 | 9 | % | ||||
| Inventory |
736,916 | 7 | % | 805,288 | 8 | % | ||||
| Other receivables and assets |
351,035 | 3 | % | 334,444 | 3 | % | ||||
| Total current assets |
3,537,067 | 32 | % | 3,391,478 | 33 | % | ||||
| Investments and other non-current assets |
307,354 | 3 | % | 245,632 | 2 | % | ||||
| Property, plant and equipment, net |
7,007,544 | 64 | % | 6,528,182 | 63 | % | ||||
| Other Intangible assets, net |
182,626 | 2 | % | 192,010 | 2 | % | ||||
| Total assets |
11,034,591 | 100 | % | 10,357,302 | 100 | % | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||||
| Current liabilities: |
||||||||||
| Short-term debt |
550,652 | 5 | % | 694,230 | 7 | % | ||||
| Trade accounts and notes payable |
612,242 | 6 | % | 581,581 | 6 | % | ||||
| Other payables and accrued liabilities |
1,666,845 | 15 | % | 1,292,453 | 12 | % | ||||
| Total current liabilities |
2,829,739 | 26 | % | 2,568,264 | 25 | % | ||||
| Long-term debt |
2,478,724 | 22 | % | 1,984,432 | 19 | % | ||||
| Reserves for pension |
42,353 | 0 | % | 31,964 | 0 | % | ||||
| Total liabilities |
5,350,816 | 48 | % | 4,584,660 | 44 | % | ||||
| Common Stock & Capital surplus |
2,638,850 | 24 | % | 2,638,850 | 25 | % | ||||
| Accumulated result |
3,012,823 | 27 | % | 3,091,674 | 30 | % | ||||
| Capital adjustment |
32,102 | 0 | % | 42,118 | 0 | % | ||||
| Shareholders’ equity |
5,683,775 | 52 | % | 5,772,642 | 56 | % | ||||
| Total liabilities and shareholders’ equity |
11,034,591 | 100 | % | 10,357,302 | 100 | % | ||||
- These financial statements are provided for informational purposes only
LG.Philips LCD
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions of KRW)
(The financial statements are based on unaudited Korean GAAP)
In millions of KRW
| 2005 |
2004 |
|||||
| 1Q |
1Q |
|||||
| Net Income |
(78,830 | ) | 627,925 | |||
| Depreciation |
402,651 | 271,773 | ||||
| Amortization |
11,546 | 11,312 | ||||
| Others |
17,494 | 5,421 | ||||
| Operating Cash Flows |
352,861 | 916,431 | ||||
| Net Change in Working Capital |
(270,051 | ) | (172,862 | ) | ||
| Change in A/R |
(210,419 | ) | (123,847 | ) | ||
| Change in inventory |
68,373 | (41,490 | ) | |||
| Change in A/P |
31,182 | (5,784 | ) | |||
| Change in others |
(159,187 | ) | (1,741 | ) | ||
| Cash Flows from Operations |
82,810 | 743,569 | ||||
| Capital Expenditures |
(452,673 | ) | (730,401 | ) | ||
| Equipment investment |
(449,822 | ) | (745,332 | ) | ||
| (Delivery) |
(909,889 | ) | (939,887 | ) | ||
| (Other account payables) |
460,067 | 194,555 | ||||
| Intangible asset investments |
(2,161 | ) | 0 | |||
| Others |
(690 | ) | 14,931 | |||
| Cash Flows before Financing |
(369,863 | ) | 13,168 | |||
| Cash Flows from Financing Activities |
359,116 | 25,143 | ||||
| Net Cash Flows |
(10,747 | ) | 38,311 | |||
- These financial statements are provided for informational purposes only
LG.Philips LCD
CONSOLIDATED STATEMENTS OF INCOME
(In millions of KRW)
(The financial statements are based on unaudited US GAAP)
In millions of KRW
| 2005 |
2004 |
|||||||||||
| 1Q |
1Q |
|||||||||||
| REVENUE |
2,064,046 | 100 | % | 2,188,013 | 100 | % | ||||||
| Cost of goods sold |
(2,090,143 | ) | -101 | % | (1,411,656 | ) | -65 | % | ||||
| GROSS PROFIT |
(26,097 | ) | -1 | % | 776,357 | 35 | % | |||||
| Selling, general & administrative exp. |
(99,409 | ) | -5 | % | (68,801 | ) | -3 | % | ||||
| OPERATING INCOME |
(125,506 | ) | -6 | % | 707,556 | 32 | % | |||||
| Interest income |
8,991 | 0 | % | 3,936 | 0 | % | ||||||
| Interest expense |
(22,820 | ) | -1 | % | (17,332 | ) | -1 | % | ||||
| Foreign exchange gain (loss), net |
(8,652 | ) | 0 | % | (3,731 | ) | 0 | % | ||||
| Others, net |
180 | 0 | % | 550 | 0 | % | ||||||
| Total other income (expense) |
(22,301 | ) | -1 | % | (16,577 | ) | -1 | % | ||||
| INCOME BEFORE TAX |
(147,807 | ) | -7 | % | 690,979 | 32 | % | |||||
| Income tax expense |
53,298 | 3 | % | (51,312 | ) | -2 | % | |||||
| NET INCOME(LOSS) |
(94,509 | ) | -5 | % | 639,667 | 29 | % | |||||
- These financial statements are provided for informational purposes only
LG.Philips LCD
CONSOLIDATED BALANCE SHEETS
(In millions of KRW)
(The financial statements are based on unaudited US GAAP)
| In millions of KRW
|
||||||||||
| 2005 |
2004 |
|||||||||
| 31-Mar |
31-Dec |
|||||||||
| ASSETS |
||||||||||
| Current assets: |
||||||||||
| Cash and cash equivalents |
1,350,492 | 12 | % | 1,361,239 | 13 | % | ||||
| Trade accounts and notes receivable |
1,098,624 | 10 | % | 889,909 | 9 | % | ||||
| Inventory |
736,872 | 7 | % | 804,117 | 8 | % | ||||
| Other receivables and assets |
320,980 | 3 | % | 343,663 | 3 | % | ||||
| Total current assets |
3,506,968 | 32 | % | 3,398,928 | 33 | % | ||||
| Investments and other non-current assets |
345,175 | 3 | % | 262,160 | 3 | % | ||||
| Property, plant and equipment, net |
7,043,223 | 64 | % | 6,563,977 | 64 | % | ||||
| Other Intangible assets, net |
37,711 | 0 | % | 37,435 | 0 | % | ||||
| Total assets |
10,933,077 | 100 | % | 10,262,500 | 100 | % | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||||
| Current liabilities: |
||||||||||
| Short-term debt |
552,293 | 5 | % | 696,212 | 7 | % | ||||
| Trade accounts and notes payable |
612,255 | 6 | % | 583,117 | 6 | % | ||||
| Other payables and accrued liabilities |
1,670,054 | 15 | % | 1,294,755 | 13 | % | ||||
| Total current liabilities |
2,834,602 | 26 | % | 2,574,084 | 25 | % | ||||
| Long-term debt |
2,488,016 | 23 | % | 1,993,150 | 19 | % | ||||
| Reserves for pension |
42,318 | 0 | % | 31,963 | 0 | % | ||||
| Total liabilities |
5,364,936 | 49 | % | 4,599,197 | 45 | % | ||||
| Common Stock & Capital surplus |
2,629,477 | 24 | % | 2,628,519 | 26 | % | ||||
| Accumulated result |
2,906,511 | 27 | % | 3,001,042 | 29 | % | ||||
| Capital adjustment |
32,153 | 0 | % | 33,742 | 0 | % | ||||
| Shareholders’ equity |
5,568,141 | 51 | % | 5,663,303 | 55 | % | ||||
| Total liabilities and shareholders’ equity |
10,933,077 | 100 | % | 10,262,500 | 100 | % | ||||
- These financial statements are provided for informational purposes only
LG.Philips LCD
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions of KRW)
(The financial statements are based on unaudited US GAAP)
In millions of KRW
| 2005 |
2004 |
|||||
| 1Q |
1Q |
|||||
| Net Income |
(94,509 | ) | 639,667 | |||
| Depreciation |
403,022 | 269,754 | ||||
| Amortization |
1,885 | 1,650 | ||||
| Others |
14,572 | 1,644 | ||||
| Operating Cash Flows |
324,970 | 912,715 | ||||
| Net Change in Working Capital |
(242,160 | ) | (154,064 | ) | ||
| Change in A/R |
(276,512 | ) | (112,165 | ) | ||
| Change in inventory |
67,245 | (41,498 | ) | |||
| Change in A/P |
29,659 | (6,037 | ) | |||
| Change in others |
(62,552 | ) | 5,636 | |||
| Cash Flows from Operations |
82,810 | 758,651 | ||||
| Capital Expenditures |
(452,673 | ) | (730,401 | ) | ||
| Equipment investment |
(448,159 | ) | (730,453 | ) | ||
| (Delivery) |
(908,226 | ) | (925,008 | ) | ||
| (Other account payables) |
460,067 | 194,555 | ||||
| Intangible asset investments |
(2,161 | ) | 0 | |||
| Others |
(2,353 | ) | 52 | |||
| Cash Flows before Financing |
(369,863 | ) | 28,250 | |||
| Cash Flows from Financing Activities |
359,116 | 9,993 | ||||
| Net Cash Flows |
(10,747 | ) | 38,243 | |||
- These financial statements are provided for informational purposes only
LG.Philips LCD
Net Income Reconciliation to US GAAP
(In millions of KRW)
| 2005 |
|||
| Q1 |
|||
| Net Income under K GAAP |
(78,830 | ) | |
| Total US GAAP Adjustments |
(15,679 | ) | |
| Depreciation of property, plant and equipment |
(655 | ) | |
| Amortization of Intellectual Property Rights |
11,806 | ||
| Adjustment of AR discount loss |
(558 | ) | |
| Capitalization of financial interests |
539 | ||
| Inventory valuation effect of US GAAP Adjustments |
(1,016 | ) | |
| Pension expense |
974 | ||
| Income tax effect of US GAAP Adjustments |
(25,811 | ) | |
| Others |
(958 | ) | |
| Net Income under US GAAP |
(94,509 | ) | |
- These financial statements are provided for informational purposes only
Q1 05 Earnings Results
April 11, 2005
Disclaimer
This presentation contains forward-looking statements. We may also make written or oral forward-looking statements in our periodic reports to the United States Securities and Exchange Commission and the Korean Financial Supervisory Service, in our annual report to shareholders, in our proxy statements, in our offering circulars and prospectuses, in press releases and other written materials and in oral statements made by our officers, directors or employees to third parties. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events.
Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Such factors include, but are not limited to: our highly competitive environment; the cyclical nature of our industry; our ability to introduce new products on a timely basis; our dependence on growth in the demand for our products; our ability to successfully execute our expansion strategy; our dependence on key personnel; and general economic and political conditions, including those related to the TFT-LCD industry; possible disruptions in business activities caused by natural and human-induced disasters, including terrorist activity and armed conflict; and fluctuations in foreign currency exchange rates. Additional information as to these and other factors that may cause actual results to differ materially from our forward-looking statements can be found in our filings with the Securities and Exchange Commission.
This presentation also includes information regarding our historical financial performance through March 31, 2005, and our expectations regarding future performance as reflected in certain non-GAAP financial measures as defined by Securities and Exchange Commission rules. As required by such rules, we have provided a reconciliation of those measures to the most directly comparable GAAP measures, which is available on our investor relations website at http://www.lgphilips-lcd.com under the file name Q105 Earnings Presentation.
Agenda
Q1 05 Earnings Results
Performance Highlights
Outlook
32”W
37”W
42”W
47”W
Paju-P7
Q1 05 Earnings Results
Q1 05 Income Statement
KRW bn Q1 05 Q4 04 Q1 04 QoQ change YoY change
Revenue
COGS
Gross profit
Operating income
EBITDA
Income before tax
Net income
2,064 2,102 (38) (135) 269 (157) (79)
1,933 1,840 93 2 412 19 35
2,188 1,418 770 699 976 679 628
7% 14% N/A N/A (35%) N/A N/A
(6%) 48% N/A N/A (72%) N/A N/A
Margin (%)
Gross margin
Operating margin
EBITDA margin
Net margin
(2) (7) 13 (4)
35 32 45 29
5 0 21 2
(7) (7) (8) (6)
(37) (39) (32) (33)
Source: Unaudited, Company financials
K GAAP (Consolidated)
Q1 05 Balance Sheet
KRW bn Q1 05 Q4 04 Q1 04 QoQ change YoY change
11,035 1,350 737 5,351 551 2,479 5,684 30
10,357 1,361 805 4,585 694 1,985 5,772 23
7,287 542 379 3,741 570 1,352 3,546 39
7% (1%) (8%) 17% (21%) 25% (2%) 7
51% 149% 94% 43% (3%) 83% 60% (9)
Assets
Cash & equivalent
Inventory
Liabilities
Short term debt
Long term debt
Shareholders’ equity
Net debt to equity ratio (%)
K GAAP (Consolidated)
Source: Unaudited, Company financials
6
Q1 05 Cash Flow
KRW bn Q1 05 Q4 04 Q1 04 QoQ change YoY change
(79) 415 17 (270) 83 (453) (370) 359 (11)
35 384 (74) (198) 147 (473) (326) 475 149
628 283 5 (173) 743 (730) 13 25 38
(114) 31 91 (72) (64) 20 (44) (116) (160)
(707) 132 12 (97) (660) 277 (383) 334 (49)
Net income
Depreciation & Amortization
Others
Working capital
Cash flow from operations
CAPEX
Cash flow before financing
Financing activities
Net change in cash
K GAAP (Consolidated)
Source: Unaudited, Company financials
7
Performance Highlights
Shipments and ASP Total K m² * ASP**/m² (US$)
2,500 $4,000 $3,512 $3,554 $3,500 $2,857 2,000
$3,000 $2,500 1,500 $2,304 $2,085 $2,000 1,000
958 771 $1,500 561 560 531 $1,000 500 $500 0
$0 Q4 Q3 Q2 Q1 04 Q1 05 Total K m² ASP/m²
Source: Company financials
* Net display area shipped
**Quarterly average selling price per square meter of net display area shipped
Revenue: Product Mix
4%
5%
4%
100%
14%
22%
15%
80%
26%
18%
27%
60%
40%
56%
53%
56%
20%
0%
Q4 04
Q1 04
Q1 05
TV
NBPC
MNT
APPL
Source: Company financials
Q1 05 Capacity Update
P6 input capacity averaged 55K per month for the quarter
Unit: Quarterly input capacity
by Area (K m²)
1800
1500
P6
1200
900
P5
600
P4
300
P1~P3
0
Q404
Q304
Q204
Q104
Q105
Source: Company financials
Cash ROIC
EBITDA margin
Cash ROIC
39%
36%
35%
16%
13%
52%
54%
Q1 05
2004
2003
2002
2001
42%
35%
13%
Sales / IC*
157%
146%
126%
108%
2004
2003
2002
2001
Q1 05
80%
K GAAP (Consolidated)
2004
2003
2002
2001
Q1 05
Source: Unaudited, Company financials
* IC (Invested Capital) equals average of net debt and equity for the designated period ; 3mo 05 ratios are annualized
Outlook
Outlook
Capex schedule (KRW bn)
Total Shipments per m2
Q1 05 vs. Q2 05
: Double digit (%)
ASP per m2
End of Q1 05 vs. End of Q2 05
: Single digit (%)
EBITDA Margin
Q2 05: Mid to high teens
4,580
3,818
341
3,144
2,212
1,265
1,436
2005(E)
2004
P6
Others
P7
Source: Company financials, Delivery base
Board Of Directors Audit Committee Remuneration
Committee Outside Director Nomination and Corporate Governance Committee
Bon Joon Koo JRD, Vice Chairman & CEO Ad Huijser Chairman of
The Board of Directors Ron H. Wirahadiraksa JRD, President & CFO
Ingoo Han Director Bart Van Halder Director Doug Dunn Director
Dongwoo Chun Director Hee Gook Lee Director Bong Sung Oum
Director Audit Committee Outside Directors
Questions and Answers
Appendix
US GAAP Income Statement
KRWbn Q1 05 Q4 04 Q1 04 QoQ change YoY change
2,064 2,090 (26) (126) 272 (148) (95) 2,188 1,412
776 708 977 691 640 1,933 1,823 110 14 429 41 56
7% 15% N/A N/A (37%) N/A N/A (6%) 48% N/A
N/A (72%) N/A N/A Revenue COGS Gross profit
Operating income EBITDA Income before tax Net income
Margin (%)
35 32 45 29 6 1 22 3 (7) (7) (9) (7) (37) (38) (31) (34)
Gross margin Operating margin EBITDA margin
Net margin (1) (6) 13 (5)
Source: Unaudited, Company financials
US GAAP Balance Sheet
KRW bn Q1 05 Q4 04 Q1 04 QoQ change YoY change
10,933 1,350 737 5,365 552 2,488 5,568 30
7,159 542 377 3,748 571 1,359 3,411 41
10,262 1,361 804 4,599 696 1,993 5,663 23
7% (1%) (8%) 17% (21%) 25% (2%) 7
53% 149% 95% 43% (3%) 83% 63% (10)
Assets
Cash & equivalent
Inventory
Liabilities
Short term debt
Long term debt
Shareholders’ equity
Net debt to equity ratio (%)
Source: Unaudited, Company financials
US GAAP Cash Flow
KRW bn Q1 05 Q4 04 Q1 04 QoQ change YoY change
640 272 1 (154) 759 (731) 28 10 38
(95) 405 15 (242) 83 (453) (370) 359 (11)
(151) 29 81 (44) (85) 25 (60) (100) (160)
(735) 133 14 (88) (676) 278 (398) 349 (49)
56 376 (66) (198) 168 (478) (310) 459 149
Net income
Depreciation & Amortization
Others
Working capital
Cash flow from operations
CAPEX
Cash flow before financing
Financing activities
Net change in cash
Source: Unaudited, Company financials
Net Income Reconciliation to US GAAP
KRW bn Q1 05 Q4 04
Net income under K GAAP (79) 35
US GAAP adjustments (16) 21
Depreciation of PP&E (1) (1)
Amortization of IPR 12 10
Adjustment of AR discount loss (1) 0
Capitalization of financial interests 1 4
Inventory valuation effect of US GAAP adjustments (1) 0
Cash flow hedge account 0 0
Pension expense 1 (1)
Income tax effect of US GAAP adjustments (26) (1)
Others (ESOP, etc) (1) 10
Net income under US GAAP (95) (56)
Source: Unaudited, Company financials
EBITDA Reconciliation
K GAAP (KRW bn) Q1 05 Q4 04 Q1 04 QoQ change YoY change
1. Net income (79) 35 628 (114) (707)
2. Interest expense 21 16 18 5 3
3. Interest income 9 7 4 2 5
4. Provision (benefit) for income taxes (79) (16) 51 (63) (130)
5. Depreciation of PP&E 403 373 272 30 131
6. Amortization of intangible asset 12 11 11 1 1
7. Amortization of debt issuance cost 0 0 0 0 0
EBITDA (1+2-3+4+5+6+7) 269 412 976 (143) (707)
US GAAP (KRW bn) Q1 05 Q4 04 Q1 04 QoQ change YoY change
1. Net income (95) 56 640 (151) (735)
2. Interest expense 23 17 17 6 6
3. Interest income 9 7 4 2 5
4. Provision (benefit) for income taxes (53) (14) 51 (39) (104)
5. Depreciation of PP&E 403 374 270 29 133
6. Amortization of intangible asset 2 2 2 0 0
7. Amortization of debt issuance cost 1 1 1 0 0
EBITDA (1+2-3+4+5+6+7) 272 429 977 (157) (705)
EBITDA Reconciliation (Continued)
EBITDA is defined as net income (loss) plus: interest income (expense); provision (benefit) for income taxes; depreciation of property, plant and equipment; amortization of intangible assets; and amortization of debt issuance cost. EBITDA is a key financial measure used by our senior management to internally evaluate the performance of our business and for other required or discretionary purposes. Specifically, our significant capital assets are in different stages of depreciation, and because we do not have separate operating divisions, our senior management uses EBITDA internally to measure the performance of these assets on a comparable basis. We also believe that the presentation of EBITDA will enhance an investor’s understanding of our operating performance as we believe it is commonly reported and widely used by analysts and investors in our industry. It also provides useful information for comparison on a more comparable basis of our operating performance and those of our competitors, who follow different accounting policies. For example, depreciation on most of our equipment is made based on a four-year useful life while most of our competitors use different depreciation schedules from our own. EBITDA is not a measure determined in accordance with U.S. GAAP. EBITDA should not be considered as an alternative to operating income, cash flows from operating activities or net income, as determined in accordance with U.S. GAAP. Our calculation of EBITDA may not be comparable to similarly titled measures reported by other companies.
LG.Philips LCD makes
Technology you can see!
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| LG.Philips LCD Co., Ltd. | ||||
| (Registrant) | ||||
| Date: April 11, 2005 |
By: |
/s/ Ron H. Wirahadiraksa | ||
| (Signature) | ||||
| Name: |
Ron H. Wirahadiraksa | |||
| Title: |
Joint Representative Director/ | |||
| President & Chief Financial Officer | ||||