Lg Chem Ltd. · KRX:051910
Lg Chem — Non-Deal Roadshow (September 2008)
18 slides from Lg Chem's roadshow presentation, Sep 1, 2008
Slide 1: Market Outlook
SolutionPartner Market Outlook 2008. 9 @ LG Chem
Slide 2: Audit review and forward-looking notice
The business results for the 2nd quarter of 2008 currently under audit review are presented here for investors’ convenience. Hence, please be advised that some of their contents may be altered in the course of audit. Forecasts and projections contained in this material are based on current business
Slide 3: Table of Contents
Table of Contents Business Portfolio 1 Vertical Integration 2 Quarterly Business Results 3 2Q 2008 Business Results 4 Divisional Results & Outlook 6 Appendix 9
Slide 4: Business Portfolio
Business Portfolio 2008 1H consolidated performance LG Chem (Sales : 8.4tn KRW) Petrochemicals Industrial I&E (70%) Materials (15%) Materials (15%) PVC (13%) Optical/ Electronic Housing Solutions (56%) Materials (76%) NCC/ Polyolefin (31%) Living/Automotive Batteries (24%) Solutions (44%) ABS/PS & E
Slide 5: Vertical Integration (Ethylene)
Vertical Integration (Ethylene) Yeosu Plant Daesan Plant Ethylene Ethylene 900 KMT 760 KMT 40 205 LDPE (140) ** OCU (140) 310 LLDPE (80) HDPE (300) 170 HDPE (170) LDPE (160) 160 170 EG (150) EDC (250) SM (180) 245 VCM (720) 35 VCM (180) 145 SM (500) 180 * ( ) : production capacity (KMT/yr) LG Bohai
Slide 6: Quarterly Business Results
Quarterly Business Results Consolidated Non-Consolidated (Unit:KRW bn) (Unit:KRW bn) 4.01tn 4.39tn 3.74tn 3.45tn 3.38tn 527.1 481.4 401.2 2.64tn 378.8 292.0 162.9 '07 2Q '08 1Q '08 2Q '07 2Q '08 1Q '08 2Q Sales OP Sales OP 3 /15
Slide 7: 2Q 2008 Business Results Income Statements
2Q 2008 Business Results Income Statements Consolidated Non-Consolidated (Unit : KRW bn) ’07 2Q ’08 2Q ’08 1Q YoY ’07 2Q ’08 2Q ’08 1Q YoY Sales 3,383.6 4,385.9 4,014.0 29.6% 2,644.9 3,738.0 3,448.1 41.3% Operating Profit 292.0 527.1 401.2 162.9 481.4 378.8 80.5% 195.5% (%) (8.6) (12.0) (10.0) (6.2)
Slide 8: 2Q 2008 Business Results Balance Sheets
2Q 2008 Business Results Balance Sheets Consolidated Non-Consolidated (Unit : KRW bn) ’07 ’08.2Q ’07 ’08.2Q Assets 8,550.8 9,352.1 7,050.0 7,613.0 (Cash and equivalents) 590.5 370.5 466.4 245.9 Liabilities 4,506.8 4,793.8 3,171.8 3,214.3 (Borrowings) 2,367.9 2,437.4 1,361.6 1,215.7 Shareholder’s 4,0
Slide 9: Divisional Results & Outlook: Petrochemicals
Divisional Results & Outlook Petrochemicals(Consolidated) Business results Analysis (Unit:KRW bn) • Analysis 3,131.1 ▣ PO : Successful pass-through of mounting input cost (naphtha) to ABS/EP 2,835.3 ASP given tight supply condition 31% 2,299.5 32% NCC/PO ▣ ABS/PVC : Rapid margin improvement leverage
Slide 10: Divisional Results & Outlook: I & E Materials
Divisional Results & Outlook I & E Materials(Consolidated) Business results Analysis (Unit:KRW bn) 654.1 • Analysis 619.5 ▣ Electronics & opticals 530.4 22% - Continued strong demand in LCD 26% - Improved profitability on account of internal cost saving activity Battery 29% ▣ Battery - Cylindrical :
Slide 11: Divisional Results & Outlook: Industrial Materials
Divisional Results & Outlook Industrial Materials(Consolidated) Business results Analysis (Unit:KRW bn) 662.3 • Analysis 615.8 ▣ Sales 568.7 - Domestic : Sales volume increase driven by seasonally strong demand Living 44% Solutions/ 43% - Overseas : Sales increase in Window frame and Hi-Macs (artifi
Slide 12: Sales & Operating Profit (Consolidated)
Appendix Sales & Operating Profit(Consolidated) (Unit: KRW bn) 2007 2008 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q 4Q Total Sales 3,040.6 3,383.6 3,565.9 3,534.7 13,524.8 4,014.0 4,385.9 8,399.9 Operating Profit 258.1 292.0 374.1 263.0 1,187.2 401.2 527.1 928.3 Petrochemicals 2,037.5 2,299.5 2,396.2 2,380.5 9,113.
Slide 13: Sales & Operating Profit (Non-Consolidated)
Appendix Sales & Operating Profit(Non-Consolidated) (Unit: KRW bn) 2007 2008 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q 4Q Total Sales 2,380.0 2,644.9 2,766.6 3,003.8 10,795.3 3,448.1 3,738.0 7,186.0 Operating Profit 127.0 162.9 252.5 221.2 763.6 378.8 481.4 860.2 Petrochemicals 1,498.3 1,647.3 1,742.8 1,905.5 6,79
Slide 14: Borrowings & Cash Flow (Non-consolidated)
Appendix Borrowings & Cash Flow(Non-consolidated) Borrowings Cash Flow (Unit : KRW bn) (Unit : KRW bn) Balance ’08 (P) ’07 ’08.2Q ’07 ’08.2Q Changes 1,361.6 1.215.7 -145.9 1,315.2 Beginning 115.8 466.4 Total (100%) (100%) (100%) Operating/Investing 647.2 214.5 KRW 1,033.2 923.6 -109.6 1,000.2 (76%)
Slide 15: Capex Plan & Results (Non-consolidated)
Appendix Capex Plan & Results(Non-consolidated) (Unit : KRW bn) ’06 Results ’07 Results ’08 Plan ’08 2Q Results New/Expansion 118.2 142.2 155.6 98.3 Maintenance 83.6 68.2 94.8 40.3 Petrochemicals Equity Investment 39.0 16.4 3.0 - Total 240.8 226.7 253.4 138.7 New/Expansion 121.9 41.9 231.4 70.0 I&E
Slide 16: Major products and Naphtha price trend
Appendix Major products and Naphtha price trend ($/MT) Major product prices ’08 Monthly price 2,200 ($2,115) 2,100 (Unit : $/MT) 2,000 Change 1,900 Jan.'08 Feb Mar Apr May Jun Jul Aug 1,800 ($1,723) ($1,922) (Jan vs Aug) 1,700 WTI 92.9 95.7 105.4 111.4 124.5 133.7 133.8 116.3 ↑23.4 1,600 ($1,687) Na
Slide 17: Manufacturing Facilities (Domestic)
Appendix Manufacturing Facilities (Domestic) Domestic Manufacturing Facilities Capacity 1 Daesan Plant * Capacity on a consolidated basis including overseas (Unit: KMT/yr) Ethylene LDPE (300) 1,660 LLDPE (80) HDPE (500) EO (25) EG (125) Area: 1,297,477m2 1 Naphtha EDC (597) NaOH (480) Major Products
Slide 18: Stock information
Appendix Stock information Shareholders & Market Cap GDR Info. LG Corp. Foreign Investors Listed in LSE 33.5% 26.7% 144A GDR Reg.S GDR Institutional & Individual Investors 39.8% ORD:GDR Ratio: 1:2 Exchange: PORTAL Ticker: LGCLY US Common Stock as of Aug 22, 2008 ISIN: US5019551085 (Unit : KRW) Aug 2