Lg Chem Ltd. · KRX:051910
Lg Chem — Korea Investor Conference 2010 (Citi)
19 slides from Lg Chem's conference presentation, Mar 4, 2010
Slide 1: Market Outlook
SolutionPartner Market Outlook March 2010 @ LG Chem
Slide 2: Table of Contents
Table of Contents LG Chem at a Glance 1 Differentiated Competitiveness 2 Yearly Business Results 3 2009 Business Results 4 4Q 2009 Business Results 6 Divisional Results & Outlook 8 2010 Business Plan 10 Appendix 12
Slide 3: LG Chem at a Glance
LG Chem at a Glance • LG Chem was started in 1947 and is Korea’s first and Impressive Revenue Scale… largest chemical company with an established track of over 60 years and annual revenues of KRW 15.8 trillion in 2009 15,000 % R: 16.8 15,801 CA G 14,555 • LG Chem boasts multiple production facilitie
Slide 4: Differentiated Competitiveness
Differentiated Competitiveness Distinctive Vertical Integration Vertical Integration Structure Co-existence of upstream and downstream products • One of few petrochemical companies around the globe with Naphtha Annual usage: appx. 5 mil MT a vertical integration structure, featuring both upstream an
Slide 5: Yearly Business Results (Consolidated)
Yearly Business Results (Consolidated) 15.8tn 14.6tn 11.4tn 11.4tn 2,235bn 1,321bn 1,066bn 677bn '06 '07 '08 '09 OP Sales 3 /17
Slide 6: 2009 Business Results (Consolidated)
2009 Business Results (Consolidated) 4.36tn 4.12tn 3.92tn 3.40tn 660bn 730bn 487bn 357bn '09.1Q 2Q 3Q 4Q Sales OP 4 /17
Slide 7: Operating Profit Change Analysis (Consolidated)
Operating Profit Change Analysis (Consolidated) Raw Material (Unit:KRW bn) Cost Increase Sales -109 Quantity / Inventory Valuation • Raw Material -71 Forex Change Cost Increase (-189) One-off -373 • Sales Price -80 Expenses Increase (+80) 730 -113 • Incentives • Productivity Enhancement • Marketing
Slide 8: 4Q 2009 Business Results: Income Statements
4Q 2009 Business Results Income Statements Consolidated Non-Consolidated (Unit : KRW bn) ’08.4Q ’09.3Q ’09.4Q YoY ’08.4Q ’09.3Q ’09.4Q YoY Sales 3,332 4,364 4,116 23.5% 2,816 3,798 3,563 26.5% Operating Profit 59 730 357 147 656 309 508.3% 110.2% (%) (1.8) (16.7) (8.7) (5.2) (17.3) (8.7) Pre-tax Inc
Slide 9: 4Q 2009 Business Results: Balance Sheets
4Q 2009 Business Results Balance Sheets Consolidated Non-Consolidated (Unit : KRW bn) ’08 ’09.4.1 ’09 ’08 ’09.4.1 ’09 Assets 9,736 9,110 9,950 8,036 7,502 8,359 (Cash and equivalents) 514 905 1,093 373 755 863 Liabilities 4,683 4,611 4,294 3,147 3,172 2,875 (Borrowings) 2,743 2,565 1,961 1,350 1,327
Slide 10: Divisional Results & Outlook: Petrochemicals
Divisional Results & Outlook Petrochemicals(Consolidated) Business results Analysis (Unit:KRW bn) • Analysis ▣ Appreciation of Korean Won & one-off expenses NCC/PO 3,074 2,972 weakened profitability ▣ Weak seasonality & hike of raw material cost due to 2,470 30% 30% strong oil price PVC - NCC/PO : S
Slide 11: Divisional Results & Outlook: I & E Materials
Divisional Results & Outlook I & E Materials(Consolidated) Business results Analysis (Unit:KRW bn) • Analysis ▣ Appreciation of Korean Won & marketing cost weakened 1,275 profitability 1,121 ▣ Slowdown of the demand during the off-season - Polarizer : Total sales decreased, but high value-added Elec
Slide 12: 2010 Business Plan (IFRS)
2010 Business Plan (IFRS) Business Plan Business Strategy (Unit:KRW bn) Petrochemicals : Achieve maximize profitability • Expand domestic business & strengthen competitiveness Class ’09 ’10 Plan - Yeosu NCC 100KT, BR 80KT, SAP 40KT • Increase the portion of value-added premium product - ABS 71%, PE
Slide 13: 2010 Business Plan: Cash Flow and CAPEX
2010 Business Plan (IFRS) Cash Flow CAPEX (Unit:KRW bn) Key Investments Class Amounts Class Amounts (Unit:KRW bn) Cash Inflow 2,040 Total 1,430 290 ▣ Petrochemicals From Operating 1,480 - NCC Expansion in Yeosu New / Expansion 960 - BR, SAP Expansion in Korea Type Depreciation 560 - SBS in China, et
Slide 14: Sales & Operating Profit (Consolidated)
Appendix Sales & Operating Profit(Consolidated) (Unit: KRW bn) 2008 2009 LGC 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q 4Q Total Sales 3,494 3,749 3,980 3,332 14,555 3,400 3,921 4,364 4,116 15,801 Operating Profit 362 484 416 59 1,321 487 660 730 357 2,235 Petrochemicals 2,835 3,131 3,380 2,470 11,816 2,587 2,884 3
Slide 15: Sales & Operating Profit (Non-Consolidated)
Appendix Sales & Operating Profit(Non-Consolidated) (Unit: KRW bn) 2008 2009 LGC 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q 4Q Total Sales 2,994 3,239 3,597 2,816 12,645 2,932 3,402 3,798 3,563 13,695 Operating Profit 340 445 412 147 1,344 417 563 656 309 1,945 Petrochemicals 2,397 2,607 2,961 2,075 10,039 2,152 2,
Slide 16: Borrowings & Cash Flow (Non-consolidated)
Appendix Borrowings & Cash Flow(Non-consolidated) Borrowings Cash Flow (Unit : KRW bn) (Unit : KRW bn) Balance ’08 ’09 Beginning 466 373 ’08 ’09.4.1 ’09 Operating/Investing 246 1,204 1,350 1,327 867 Total Net Income 1,003 1,507 (100%) (100%) (100%) Depreciation 402 409 KRW 929 865 517 Currency (69%)
Slide 17: CAPEX Plan & Results (Non-consolidated)
Appendix CAPEX Plan & Results(Non-consolidated) (Unit : KRW bn) ’07 ’08 ’09 Plan ’09 New/Expansion 142 217 104 117 Maintenance 68 85 136 109 Petrochemicals Equity Investment 16 - 23 6 Total 227 302 263 232 New/Expansion 42 194 347 382 I&E Maintenance 36 51 91 67 Materials Equity Investment 12 21 28
Slide 18: Price Trends
Appendix Price Trends (Unit:U$/MT) (Unit:U$/MT) 1,858 1,800 1,720 1,681 1,718 1,632 1,530 2,109 1,961 1,822 1,333 2,032 1,462 1,271 1,756 1,973 1,320 1,381 1,655 1,307 1,198 1,492 1,260 1,265 1,700 1,471 1,036 1,027 1,227 1,417 1,377 1,016 1,164 945 1,259 1,186 1,197 1,168 873 1,008 1,111 938 963 1,
Slide 19: Stock Information
Appendix Stock Information Shareholders Stock Information (Unit : KRW) Mar 2, ’10 LG Corp. Foreign Investors No. of 33.5% 27.1% Shares Market Price Cap Institutional & Individual Common 66,271,100 216,500 14.3 tn Investors 39.4% Preferred 7,628,921 79,400 0.6 tn Total 73,900,021 14.9 tn Common Stock