Business Context and Reporting Period
Company: LG Display Co., Ltd.
Filing Type: Form 6-K (Report of Foreign Private Issuer)
Reporting Period: Third Quarter 2009 (ended September 30, 2009)
Filing Date: October 15, 2009
Business Overview: LG Display is a leading manufacturer of TFT-LCD panels, OLEDs, and flexible displays for TVs, monitors, notebook PCs, and mobile applications. The company operates eight fabrication facilities and five back-end assembly facilities globally.
Key Financial Metrics (Consolidated Korean GAAP)
Unit: KRW Billion (unless otherwise noted)
| Item | Q3 2009 | Q2 2009 | Q3 2008 |
|---|---|---|---|
| Revenues | 5,974 | 4,891 | 3,861 |
| Operating Income | 904 | 218 | 254 |
| Income Before Tax | 671 | 350 | 310 |
| Net Income | 559 | 302 | 295 |
| EBITDA | 1,690 | 938 | 874 |
Liquidity and Balance Sheet:
- Cash and Cash Equivalents: KRW 2,713 billion (as of Sept 30, 2009)
- Liability to Equity Ratio: 91%
- 2009 CAPEX Guidance: Approximately KRW 3.5 trillion
Material Changes vs. Prior Periods
- Revenue Growth: Revenues increased 22.1% quarter-over-quarter (QoQ) and 54.7% year-over-year (YoY), driven by increased market demand and selling prices.
- Profitability Surge: Operating income jumped 314.7% QoQ and 255.9% YoY. Net income rose 85.1% QoQ and 89.5% YoY.
- Operational Efficiency: Average selling price per square meter increased 12% QoQ to USD 833. Average utilization rate reached nearly 100%.
- Volume: Total display area shipped reached a record 5.66 million square meters, up 13% QoQ.
- Inventory: Inventory days remained below two weeks.
Outlook, Management Commentary, and Risks
Management Commentary: CEO Young Soo Kwon attributed record results to increased market demand, higher selling prices, customer-oriented marketing, and the full operation of new production lines. The company aims to maximize customer value through superior product quality.
Guidance for Q4 2009:
- Shipments: Expected to increase by an upper single-digit percentage.
- Pricing: Average selling price per square meter is expected to decline gradually.
Risks and Contingencies:
- The filing contains forward-looking statements based on current plans and estimates; actual results may differ materially due to inherent risks and uncertainties.
- The company reserves the right to update its business outlook at any time.
- Financial data for Q3 2009 is unaudited and subject to change.
Key Facts for Investor Verification
- Verify the sustainability of the 12% QoQ increase in average selling prices given the guidance for a gradual price decline in Q4.
- Confirm the impact of the 91% Liability to Equity ratio on future debt servicing capabilities amidst a KRW 3.5 trillion CAPEX plan.
- Monitor the "upper single-digit" shipment growth guidance against the backdrop of expected price erosion in Q4.
- Validate the 100% utilization rate and sub-two-week inventory days as indicators of supply chain efficiency.
- Review the unaudited nature of the Q3 2009 financial data prior to finalizing investment decisions.