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Good afternoon. My name is Seung-Yeon Kim from IR Communications. Thank you for joining LG Electronics Earnings Release Conference Call for the fourth quarter of 2023. With me are representatives of each business management division, Mr. Lee Kwon Kim from Home Appliance and Air Solutions, Mr. Jung-Hee Lee from Home Entertainment, Mr. Ju-Young Kim from Vehicle Component Solutions, Mr. Dong-Chul Lee from Business Solutions. We are also joined by Mr. Sangho Park from Global Business Management Group, Mr. Chung Hyun Park from Corporate Business Management Division, Mr. Hongsoo Lee from Accounting Division, and Mr. Youngkyun Kim from Finance Division. Please note that all statements we'll be making today regarding the financial results of the fourth quarter are subject to change in accordance with the result of the external audit. I would also like to remind you that uncertainties in the market and changes in strategies may cause our results to be different from the outlooks and forward-looking statements made today. Today, I will outline the overall performance results of the fourth quarter of 2023 and the outlook for the full year of 2024 and the first quarter. Then, each division will take turns to deliver its business results and outlook. After that, I will share our ESG activities and achievements. Now let me start with the consolidated financial results of the fourth quarter of 2023 and the outlook for 2024 and the first quarter. Consolidated sales of the fourth quarter was 23.1 trillion won and operating profit was 313.1 billion won. Q4 revenue grew year-on-year on the back of stable growth in appliance and increased sales of electric vehicle components, though sluggish revenue continued in TV due to slowing demand from premium TVs. Operating profit recorded a loss due to increased marketing spending to address year-end peak season demand including Black Friday promotions and one-off costs such as year-end performance incentives. I will now briefly review the fourth quarter performance of each business. H&A recorded 6.7 trillion won in sales and 115.6 billion won in operating loss. AG recorded 4.2 trillion won in sales and 72.2 billion won in operating loss. GS recorded 2.6 trillion won in sales 5.7 billion won in operating profit and 0.2% in profitability. ES recorded 1.3 trillion won in sales and 89.5 billion won in operating loss. Each business will later share its respective business results and outlook in detail. Let's move on to the profit and loss and cash flow of the fourth quarter. In terms of profit and loss, reflecting financial income and expense, equity method gain and loss, other non-operating income and expense, corporate income tax, and income and loss from discontinued operations, we posted negative 76.4 billion won in net income. Next on cash flow. Q4 cash flow from operating activities was 1.5 trillion won and cash flow from investment activities was negative 1.1 trillion won. Accordingly, net cash flow was 385.2 billion won. When reflecting cash flow from financial activities of negative 9.8 billion won, cash balance at the end of Q4 increased 375.4 billion won from the previous quarter to stand at 8.5 trillion won. Next is the key financial position and indicators for the fourth quarter of 2023. As of the end of the fourth quarter, assets stood at 60.2 trillion won, liability at 36.7 trillion won, and equity at 23.5 trillion won. In terms of leverage ratios, regarding liability to equity, debt to equity, and net debt to equity, we are maintaining a healthy financial condition. Now the outlook for the year 2024 and the first quarter. In terms of the business environment, there are expectations of a recovery in consumer sentiment attributable to slowing inflation and possible interest cuts in major regions like the US and Europe. But concerns regarding protracted geopolitical risks and bottlenecks in global maritime logistics also exist. We will continue to grow our top line in main businesses as well as enhance the business portfolio by expanding B2B and software platform businesses and maintain stable cost structures through fundamental cost improvements and efficient spending. We plan to strengthen business competitiveness by expanding investments in line with our strategic priorities. Accordingly, we seek to grow revenue in 2024 by responding nimbly to shifts in demand and driving stronger performance in B2B businesses such as vehicle components and HVAC. We will secure sound levels of profitability on an annual basis by maintaining stable cost structures through preemptive efforts. In the first quarter, we plan to reach revenue levels higher than that of the previous year on the back of a pickup in B2C sales and steep growth in vehicle components business. We aim to maintain stable levels of profitability through enhanced operation efficiency. Now let's move on to the fourth quarter results and outlook for 2024 and the first quarter by business. We will start with H&A. Let me share the fourth quarter results of H&A. Though recovery of demand in the global appliance market is delayed, Revenue increased year-on-year on the back of our strengthening of the two-track strategy to address the premium and volume zone segments and expansion in new business areas such as appliance subscription. Operating profit decreased year-on-year despite stable operations regarding material and logistics costs because of increased marketing spending to address intensified competition in the market and the impact from year-end performance incentives. Next is the outlook for 2024 and Q1. Marketing uncertainties and intense competition are expected to persist due to the sluggish global economy and unstable international situations. Amid this environment, we seek to secure top-line growth momentum through stronger drive of the volume zone in main B2C businesses, expanded proportion of B2Bs centered around HVAC, and accelerated efforts in online and subscription businesses. We will focus capabilities on creating stable profitability through efficient resource management and cost improvement efforts. In Q1, we will maintain revenue growth momentum compared to the previous year by expanding sales of volume zone products which have relatively sound demand. We plan to secure profitability levels similar to that of the previous year by improving manufacturing costs and optimizing marketing spending. I will share the fourth quarter results of HE. Though Q4 sales increased quarter on quarter as we entered the peak season, it declined year on year due to sluggish demand for premium TVs, including our flagship product, OLED TV. Despite the sales decrease and rising LCD panel prices, the level of operating loss was reduced year-on-year by enhancing efficiencies in resource management, including marketing spend. Now let me share the outlook for 2024 and the first quarter. In the market, there are uncertainties regarding recovery of consumer sentiment, but a gradual recovery in TV demand is expected. Accordingly, we aim to turn around to a growth trend in revenue and secure solid profitability by both focusing on operations centered on premium products and expanding the software platform business. In the first quarter, we expect revenue to grow year-on-year on the back of increased sales of OLED TVs, but profitability may decrease somewhat year-on-year due to the impact from rising costs of major materials, including LCD panels. Let me share the fourth quarter results of EF revenue grew year-on-year thanks to increased sales of electric vehicle components. Though there were factors temporarily pushing up costs including incentive payments, operating profit remained in the black thanks to revenue growth. Next, the outlook for 2024 and the first quarter. Despite concerns of stagnant demand for vehicles following the slowing growth in the global economy and impact from EV subsidy reduction in many countries, Demand for electric vehicles is projected to grow, especially in North America, on the back of recovery and spending power in the second half. Accordingly, for the year 2024 and Q1, we anticipate that top-line growth momentum will continue, driven by revenue realized from project launches of awarded business. We plan to manage operations flexibly in accordance with possible short-term dips in demand and continuously make efforts to improve profitability. I will share the fourth quarter results of BS, Sales grew by a small margin year-on-year thanks to demand recovery in information display, though demand was slow to recover in the global IT market. Operating profit decreased year-on-year with increased investments to accelerate future growth, including new business areas such as EV charging. Now, let me share the outlook for the year 2024 and the first quarter. Global IT demand is expected to recover, but fierce competition is expected to remain overall. We will pursue top-line growth based on our new lineup in Gaming Monitors and GramPro, and strengthen efforts to secure more projects, especially in the government and education verticals. We aim to secure profitability through efficient resource management. In Q1, we seek to expand revenue year-on-year by actively addressing the peak season for IT products in Korea. We plan to focus on enhancing operations through thorough inventory management and stringent spending. Last but not least, let me share our ESG activities and achievements. We are striving to give confidence to customers that they are using the most eco-friendly and convenient products and services just by choosing us. We are also seeking to enhance corporate value by minimizing ESG-related risks as well as becoming a company that customers and the market can trust the most. To provide more sustainable customer experiences, we have continuously strengthened the competitiveness of our eco-friendly products. Our products took up the top positions in all categories of the best large capacity washing machines in 2023, named by the U.S. Consumer Reports last year, and our products acquired the Green Choice mark for outstanding performance in energy efficiency. Moreover, we received recognition for our efforts to protect the environment and save energy by receiving the Energy Star from the U.S. Environment Protection Agency for the first time in the industry regarding seven induction cooktop and range models. Meanwhile, LG Electronics is placing emphasis on implementing ESG management through active collaboration with external partners. We have become a member of Glass Futures, a UK not-for-profit research and technology organization, and are exploring ways to produce glass in a sustainable manner together. These activities to continuously enhance our corporate value have also received much acknowledgement from the outside. LG Electronics was listed in the Dow Jones Sustainability World Index for 12 consecutive years last year. The DJSI World ranks the top 10% of global companies in terms of ESG management practices. LG Electronics was the sole South Korean company in the leisure equipment and consumer electronics industry to be included in the DJSI World Index for 12 years in a row. We also received an A rating for four and three consecutive years respectively from Morgan Stanley Capital International and Korea Institute of Corporate Governance and Sustainability. Going forward, we will preemptively identify ESG-related risks and opportunities to further achieve and advance ESG targets and vision. By doing so, we will ensure the long-term growth and stability of LG Electronics and maintain high levels of trust and a positive reputation among stakeholders. That brings us to the end of the fourth quarter earnings release and outlook for the year 2024 and the first quarter. We will now take questions. Operator, please commence with the Q&A session.

Now, Q&A session will begin. Please press star 1 if you have any questions. Questions will be taken according to the order you have pressed the star and 1. For cancellation, please press star and 2 on your phone. The first question will be provided by Kangho Park from Daesin Securities. Please go ahead with your question.

Yes, thank you for the opportunity to ask a question. I will ask two questions. The first is on the side of the military. This year, there is still high uncertainty in terms of macros and intelligence. In such a situation, please comment on whether there is a guidance for overall sales or sales profits in 2024. I would appreciate it if you could point out whether there is a point where we are particularly looking forward to growth among these guidance or, on the other hand, whether there is a point that is expected to be unforeseen. The second is H&A. Elec S & Gdr 144A Elec S & Gdr 144A Elec S & Gdr 144A

Thank you for taking my questions. I have two questions, and my first question is about corporate-wide operations. This year, we are expecting greater macroeconomic and geopolitical uncertainties at the moment. Under such circumstances, can you share the corporate-wide revenue and profitability guidance of 2024 And also, it will be appreciated if you can share in which business you expect specific growth or weak performance.

My second question is on H&A. I think in 2023, you achieved results and performance by maintaining the two-track strategy covering the volume zone. Is there any change in terms of strategy? Also, with Chinese competitors joining the low to mid-priced home appliance market at an accelerated pace What is your strategy for boosting LG Electronics Home Appliance market shares?

First, I would like to answer the questions related to the military sector. In the case of 2024, we are looking forward to the reconstruction of the infrastructure, and we are looking forward to the gradual recovery of demand, and we are looking forward to a better business environment than last year. However, there are still concerns about the economic downturn of major countries, including the United States, Let me answer your question about corporate-wide operations. In 2024, we expect a better business environment compared to the previous year due to expectations on ease

First of all, in the major business areas such as home appliances and TV,

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In our major business, home appliance and TVs, we expect major cost factors including raw material costs and logistic costs to remain stable. Therefore, We would like to continuously seek for stable profitability together with revenue growth through full potential strategy that actively responses to changes in the market demand through a two-track strategy and so on. In terms of B2B business concentrating in electric devices and HVAC and new business area including EV charging solutions, we would like to make meaningful investments and accelerate revenue growth and expand new orders through diversifying regional and customer portfolios so that they can further make contribution as a future growth engine.

In summary, except for LG InnoTech, the sales of LG Electronics in 2024 are expected to change to growth. In terms of profitability, we expect improvements to be made compared to last year.

Comprehensively, the corporate Y2024 revenue, excluding that of LG Innotech, will turn to the growing curve, and we plan to improve profitability year-on-year.

Yes, I will answer H&A. The company has continuously implemented a two-track strategy of premium and volume zones in line with the changes in market demand, Elec S & Gdr 144A

Let me answer your question on H&A. As you said, we have employed a two-track strategy covering both the premium and volume zone in alignment with market demand changes thus far. We will continue this approach moving forward to preemptively respond to changes in both the market and competition landscape. We will further ratchet up our competitive and market-leading products in the premium space in order to further widen the gap with Chinese makers so that they can't even catch up later. In parallel, we plan to expand ODM business in the low-to-mid-priced market while also bolstering investment to respond to Chinese companies in strategic markets.

There is a slight difference in the market, but while recent market competition is intensifying, the brand power of Chinese companies is particularly being strengthened. Therefore, the company is looking for a large-capacity, high-efficiency product

Although we might find gap differences from market to market, the brand power of Chinese companies has grown a bit amidst fierce competition. In response, we have continued ramping up the premium zone by tapping into large capacity and high efficiency products based on our competitive key components, unrivaled design, and exceptional performance. In the volume zone, we have improved our market share by further enhancing our product and price coverage.

Next question, please. The following question will be presented by Simon Woo from Bank of America. Please go ahead with your question.

The second question is about the V.S. parts. Electric vehicle subsidies in various countries such as the U.S. are mainly supported by vehicles. According to that, there is a risk that the growth rate of electric vehicles and electric vehicle parts demand can be reduced. So, I would appreciate it if you could explain your opinion and influence on this.

Thanks for taking my questions. This is Woo Dong-Jae. I have two questions. First on HE. With the LCD panel market skewing towards Chinese producers, I think LG Electronics is relying more on Chinese panel makers. What is your response to increased risk from this trend?

And my second question is on vehicle solution. In the United States, the number of EVs subjected to receive subsidies is on a decline. Accordingly, we are expecting a drop in demand in EV and EV components. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances.

I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. I would like to ask your thoughts and impact on such circumstances. Let me answer your question on HE's LCD panel sourcing.

It is true that the Chinese panel makers market share rose in the LCD panel market and we have also purchased more panels from Chinese makers. But we have operated volumes as the global number two TV business in terms of revenues and established stable partnerships with a number of Chinese panel makers. So we won't see issue with panel supply.

In addition, we have minimized risk by acquiring supply from diverse panel makers outside of China as well, like Taiwan and Japan.

Unlike other TV companies skewing towards LCD TV, we have high proportions of OLED TV within our portfolio, and that also helps in reducing our risk.

Yes, I will answer the question. In the case of the 2024 IRA account, the number of electric vehicles that can receive tax benefits will decrease for the entire year. In the short term, it may affect the collection of some electric vehicle subsidies that are installed by the parties, Let me answer your question about two vehicle solutions.

To elaborate furthermore on the IRA revision in 2024, the number of EV models subjected to receive tax benefit dropped, and this may have impact on several EV demand that has LG components installed in the short term. However, there are positive sides in the mid to long term perspective as more EVs will be rolling in the market due to the withdrawal of the limits that currently cap subsidies at 200,000 units per car makers. Therefore, We would like to keep a close eye on the market and customer changes so that we can proactively establish business operational strategies that allow us to win in the market and eventually respond to the changing market environment.

Thank you.

Next question, please. The following question will be presented by Dongwon Kim from KB Securities. Please go ahead with your question.

Thank you for taking my questions. I have two questions and my first question is on BS. I understand that you are making greater investment to accelerate into future growth. Can you give us some updates on your new business such as robots and EV charging solutions?

Second, on H&A, What is the forecast for your B2B home appliance business, including HVAC? And please cite that for us in the mid to long term. I'm also curious about your strategy for boosting market shares in North America, in Europe, and B2B sales proportions within the H&A company.

First, I would like to answer a question related to the new business of PS headquarters. First of all, in the case of robot business, we are promoting growth in delivery and logistics areas. Let me answer your question on BS New Business.

Next, EV charging business

If I may elaborate more on EV charging business,

We do expect temporary slowdown in market growth as subsidy benefits are on a decline. However, we expect demand and establishing charging infrastructure to remain strong and the market growth to be eventually accelerated in the mid-to-long-term perspective due to stronger eco-friendly regulations around the world and greater EV supply.

In 2023, we expect stable quality, vertical sales, Elec S & Gdr 144A

To respond to such environment, LG Electronics have entered into the market in 2023 based on stable quality, sales capacity, and verticals and maintenance system. We would like to develop fast chargers and ultra-fast chargers in 2024 to strengthen our product portfolio. Furthermore, we would like to expand regional coverage through establishing sales and engineering infrastructure and secure differentiated charging solutions so that we can establish our fundamentals for growth. Thank you.

Next, I will give an answer about HNA and B2B. I will explain the B2B business by dividing it into HVAC business and built-in business. First, I will explain about HVAC business. North America and Europe have a strong electrification trend Elec S & Gdr 144A

Let me answer your question on HNA's B2B. Let me split into two, HVAC and built-in, in my answer. Let me talk about the HVAC business first of all. We expect the trend toward electrification and the demand for eco-friendly and highly energy-efficient products are likely to continue to rise down the road. In North America, we will first upscale model lineups optimized for each region through a launch of new heating and cooling systems containing new refrigerant-using inverter heat pumps. Second, we will establish production bases in the U.S. Last but not least, we will increase market share by expanding installation channels, key customer touchpoints, and entering large national channels step by step.

For HVAC in Europe, we plan to enhance market share by timely addressing market demands within channels

specializes in heating products, like launching heaters with eco-friendly refrigerants using heat pumps. Based on all this, we intend to grow the European heat pump heater business to a multi-trillion business in terms of revenues in the mid to long term.

Next, I would like to talk about B2B's built-in business. B2B's built-in ultra-premium zone is a signature kitchen suite brand. Through design differentiation and product coverage expansion, On the B2B built-in business side for North American market, we'll address the super premium zone with our SKS or Signature Kitchen Suite brand to have a strong presence as a leading super premium brand

by way of our unique design and product coverage expansion. We will serve the volume zone with the LG brands by revamping our channel portfolio to drive top-line growth with built-in product lineups.

The European market's built-in package is a 24-inch package. We want to accelerate the package diversification to meet the characteristics of the region and channel, and create a global built-in business success case In the European market for built-in will drive an accelerating flywheel towards diversifying our packages optimized for each region and channel

by incorporating 24-inch models and rank in the global top five in terms of built-in business by creating more success cases of global built-in business. The annual B2B sales proportions in 2023 within the H&M company you asked about were in the low 20s. And we are now focusing on working on improving the overall value chain to raise this result. Thank you.

Next question, please.

Next question is from SK Kim from Daiwa Securities. The following question will be presented by SK Kim from Daiwa Securities. Please go ahead with your question.

Yes, hello. Thank you for the question. I have one question for the military and one for the V.S. headquarters. First of all, in the military, It is expected that AI specifications will be greatly expanded in consumer products. Please tell us about the product promotion status and future plans related to AI and the future plans of the company. The second is related to the V.S. headquarters. I would appreciate it if you could tell me how much the total number of V.S. headquarters has increased since the end of last year, the end of 2023. And recently, as I mentioned earlier, it is expected that the electricity car market fee will be reduced this year. If there is such a case, please let me know. Likewise, I would appreciate it if you could let me know if there is anything that has been canceled among the existing hydrogen projects. That's all.

Good afternoon. Thank you for giving me such opportunity. I have two questions. My first question is on corporate wide operations. I believe that this year we are expecting more AI consumer products in the market and can you share your status and plans on AI product development? And my second question is on vehicle solutions. Can you share the overall order backlog as of end of 2023? Since the EV market growth rate is expected to slow down this year, as mentioned previously, I would like to know whether there are any canceled projects out of the already signed backlog, and what is your order target for this year and expected order backlog level as of end of this year?

Yes, I will answer the questions from all four departments. First of all, the AI direction that LG Electronics seeks Let me answer your question about corporate-wide operations. LG Electronics' direction on AI is to go beyond simply providing function-based artificial intelligence and realize

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Additionally, our AI have connections with over 700 million LG smart devices around the world with real-time life intelligence

utilizing real-time live data through various IoT devices. And based on this, we are equipped with a so-called orchestrated intelligence that leads to like optimized operation by orchestrating connected devices with our LG AI brain.

These data can be used in our own security system called LG Shield. Data that we collect is safely managed and learned through our security system or security solution called LG Shield

so that we can provide a better life experience to our customers throughout our differentiated AI-based on responsible intelligence.

In the future, Affectionate Intelligence, which is based on intelligence, will expand to mobility and commercial areas in the whole space to help customers focus on more meaningful and valuable life. In order to do this, Later, we would like to expand our affectionate intelligence based on such intelligence technology from home,

For reference, last year,

Smart Mobility

In-Cabin Monitoring System Touching upon more, last year, we have allowed voice command to control home appliances, TVs, differentiate TV screen quality and sound quality. And furthermore, we have introduced air conditioners, air purifiers, washers and dryers, so that it can understand the space and situation in the smart appliances. In terms of smart mobility area where we can provide tailored services, we have commercialized in-cabin monitoring system for driver safety.

In addition, this year, through multi-modal sensing, we will be able to recognize the surrounding situation and context, not only to control the device, but also to interact with the user emotionally. Elec S & Gdr 144A and provide custom-made content. Through this, we plan to recommend content and services to AI agents, and we plan to use an additional air purifier with Intelligent Sensing technology. In addition, in the field of online channels, we will also introduce an online chatbot

This year, we would like to advance the completeness of AI agent technology, which allows personalization through user recognition and natural interaction that not only recognizes the situation and context through multi-model sensing, but also commands to the device and have emotional connection with users. Our plan is to apply this technology to VoiceHerb in the smart home sector so that it can be available in launching beta version of the smart home AI agent. In smart appliances and TVs, we would like to commercialize functions that automatically transfer accounts and recommend tailored contents together with like air conditioners and air purifiers equipped with enhanced intelligent sensing technology. In addition, We would like to commercialize chatbots using LLM that can interact and answer users' questions based on our professional intelligence in the online channel field.

Yes. Let me answer your question about vehicle solutions or their backlog.

Previously, we have disclosed that our order backlog will reach 100 trillion KRW as of end of 2023. We have successfully signed new orders based on product competitiveness and geographical conditions, and LG Magna e-Powertrain's expanded customer pipeline brought some results as well. However, due to delays in some customer company sourcing decisions and foreign exchange impact, Our order backlog remains at mid-90 trillion KRW.

Touching upon major business proportions, infotainment accounts for late 50% of order backlog while EV parts account for late 20% level and lamps mid-teen level.

Next question please

Next question, please. The following question will be presented by Hyungwoo Park from SK Securities. Please go ahead with your question.

Hello, I'm Hyungwoo Park from SK Securities. I have two questions about HE and Warrior. First, I would like to ask about how you view the 2024 TV market and OLED TV market. Elec S & Gdr 144A Elec S & Gdr 144A Elec S & Gdr 144A

Good afternoon. This is Park Hyung-woo from SK Securities. I have two questions on HE and corporate-wide operations. First, how do you envision the OLED TV market and OLED TV market respectively for 2024? Do you have any insight on possible improvement in the weekend's premium TV demand seen in 2023?

My second question is on corporate wide operations. In 2023, I understand that you have seen some enhancement in operating profit due to logistic cost ratio drop. And can you share how much impact you've seen? And importantly, I understand that there are concerns on logistic cost increase due to global logistics bottleneck phenomenon. Do you think you can keep the stable logistics cost ratio or further make improvements?

Yes, I would like to answer the question about the demand for TV market. Currently, the demand for TV market for the past 24 years has increased year-on-year, and it is expected that it will change to growth. However, it seems that it will take some time to completely resolve the demand for consumption, and it is difficult to expect a large-scale growth. However, Let me answer your question on HE's outlook on TV demand. According to market research firms, the overall 2024 TV market demand is likely to grow YOY.

But, because it will take some time for consumer sentiment to fully resolve, it's unlikely to realize significant increases. The demand of the OLED TV market, our main product line, is expected to see a rebound to 2022 levels as the market shifts away from LCD toward OLED and OLED panel prices stabilize.

In addition, the competition is looking for a new product line-up . . . Our competitors are expected to boost OLED TV sales by ramping up their product lineups with wide OLED applied. In response, we will continue unveiling some work first, like the first transparent TV we launched this year,

and the wireless OLED TV based on our 11-year heritage in OLED TV, focusing on our individualized customer values. We've been recognized through 109 awards in OLED TVs only at CES 2024, like with our OLED T and other strong industry-leading technologies and products. Therefore, based on this premium TVs leadership, we expect the premium TV demand to grow down the road.

Let me answer your question on logistic costs of corporate-wide operations.

As mentioned, despite difficult business environment including global demand drop and fiercer competition in 2023, LG Electronics was able to continue witnessing operating profit and securing business competitiveness by stabilizing cost structure including logistic cost.

In the case of the 24-year cash flow situation, the global cash flow recovery was delayed because of the increase in the inflow and the increase in the inflow. Touching upon the logistics status in 2024,

Basically, more freight space is added to the logistics loop, but the global shipment recovery is showing a flat growth, leading to a supply-centric structure, and contract renewals are taking place smoothly. However, the uncertainties in the logistics environment is going up due to red sea issues stemming from recent geopolitical risk and drought in Panama Canal.

This is due to the fact that We would like to maintain the logistic freight rates level in a stable manner by taking differentiated approaches to negotiation per shipping companies, especially in case of long-term contracts.

re-classifying strategic shipping companies per region and enhancing long-term contract conditions through negotiations. In addition, as part of taking proactive measures on the recent uncertainties, we would like to operate emergency response centers, secure alternative logistics routes, and adjust production plans in neighboring production sites so that we can minimize the business impact. Next question, please.

Currently, there are no participants with questions. Please press star 1, star N1 to give your question. Once again, currently there are no participants with questions. We will wait for a second until there is another question.

Yes, it seems that there are no additional questions. With that, we will end the 4th quarter of 2023 LG Electronics Performance Announcement Conference Call. If you have any additional questions after this time, please contact the LG Electronics IR team

That brings us to the end of LG Electronics earnings release conference call for the fourth quarter of 2023. For further questions, please contact the IR team. Thank you.