Business Context and Reporting Period
Company: LG Display Co., Ltd.
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Reporting Period: First Quarter 2013 (ended March 31, 2013)
Filing Date: April 22, 2013
Business Overview: LG Display is a leading manufacturer of TFT-LCD panels, OLEDs, and flexible displays for TVs, monitors, notebooks, tablets, and mobile applications. The company operates eight fabrication facilities and seven back-end assembly facilities globally.
Key Financial Metrics (Q1 2013)
| Item (KRW Billion) | Q1 2013 | Q4 2012 | Q1 2012 |
|---|---|---|---|
| Revenues | 6,803 | 8,743 | 6,184 |
| Operating Income | 151 | 587 | (211) |
| Income Before Tax | 41 | 503 | (197) |
| Net Income | 3.5 | 320 | (129) |
| EBITDA | 1,269 | 1,814 | 779 |
Liquidity and Solvency (as of March 31, 2013):
- Liability to Equity Ratio: 133%
- Current Ratio: 110%
- Net Debt to Equity Ratio: 16%
Operational Volume: Shipped 8.18 million square meters of net display area (up 1% year-over-year).
Material Changes vs. Prior Periods
- Revenue: Increased 10.0% year-over-year (YoY) but decreased 22.2% quarter-over-quarter (QoQ).
- Profitability: Operating income turned positive at KRW 151 billion, marking the fourth consecutive quarter of operating profit. This contrasts with an operating loss of KRW 211 billion in Q1 2012 and a significant drop from Q4 2012's KRW 587 billion.
- Net Income: Recovered to a profit of KRW 3.5 billion from a net loss of KRW 129 billion in Q1 2012, though it represents a 98.9% decline from Q4 2012.
- EBITDA: Increased 64% YoY but declined 30% QoQ.
Outlook, Management Commentary, and Risks
Management Commentary: CEO Dr. Sang Beom Han attributed the return to profitability to a strategic focus on differentiated specialty products based on IPS technology, aligning with trends for higher resolutions and larger-sized panels.
Q2 2013 Outlook:
- Shipments: Total display area shipment expected to increase by a mid-to-high single-digit percentage compared to Q1 2013.
- Pricing: Panel prices anticipated to stabilize across the board, though some products may face fluctuations.
Risks and Contingencies: The filing includes a standard forward-looking statement disclaimer. Actual results may differ materially due to inherent risks and uncertainties. The company reserves the right to update its business outlook at any time.
Key Facts for Investor Verification
- Verify the sustainability of the "fourth consecutive quarter" of operating profit given the sharp QoQ decline in operating income (from KRW 587B to KRW 151B).
- Confirm the mix of revenue by product category (TVs 43%, Monitors 21%, Notebooks 9%, Tablets 14%, Mobile 13%) and its impact on margin stability.
- Monitor the "mid-to-high single digit" shipment growth guidance for Q2 against actual market demand for larger and higher-resolution panels.
- Review the unaudited nature of the Q1 2013 financial data provided in this filing.