Lg Elec S/Gdr 144A

Good morning and good afternoon. Thank you for joining ELSA Electronics Earnings Release Conference Call for the first quarter of 2024. This conference call will start with a presentation on the earnings results followed by a Q&A session, at which time, if you wish to ask a question, you will need to press star and 1 on your telephone. I would now like to hand the conference over to the first speaker. Good afternoon. I am Changtae Kim, CFO of ELSA Electronics. Thank you for joining LG Electronics Earnings Release Conference Call for the first quarter of 2024. As of CFO, I will be hosting the Earnings Release Conference Calls going forward to describe the current status and prospects of LG Electronics and listen to your comments attentively through active communication with the market. I am joined by Mr. Sang-ho Park from Global Business Management Group as well as representatives of each Business Management Division, Mr. Lee Kwon Kim from Home Appliance and Air Solution, Mr. Junghee Lee from Home Entertainment, Mr. Juyeon Kim from Vehicle Component Solutions, Mr. Dongchul Lee from Business Solutions. Also present are Mr. Chunghyun Park from Corporate Business Management Division, Mr. Hongsoo Lee from Accounting Division, Mr. Youngjun Kim from Finance Division, Ms. Soo Jung Chung from ESG Strategy Planning Team and Mr. Won Jae Park from Investor Relations Division. Now, Mr. Won Jae Park from IR will first present the order of events for the call today, our results in the first quarter, and outlook for the second quarter.

Good afternoon.

My name is Won Jae Park from Investor Relations. I will outline the overall performance results of the first quarter of 2024 and the outlook for the second quarter. Next, each division will take turns to deliver its business results and outlook. Then, Ms. Chung from ESG Strategy Planning will share our ESG activities and achievements, followed by the CFO's comments on the strategic direction for 2024. Please note that all statements we will be making today regarding the financial results of the first quarter are subject to change in accordance with the result of the external review. 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. Now, let's start with the consolidated financial results of the first quarter of 2024 and the outlook for the second quarter. Consolidated sales of the first quarter was 21.1 trillion won and operating profit was 1.3 trillion won. Q1 revenue grew year-on-year on the back of stable growth in appliance and TV and increased sales of vehicle components centered around EV components despite the slowing demand due to contracted consumer sentiment. in terms of operating profit, though marketing spending increased to address competition in the market and there was some impact from rising LCD panel prices, we recorded stable levels of profitability thanks to revenue growth effects and enhancements in our portfolio with more focus on high-profit businesses such as platform service. I will now briefly review the first quarter performance of each business. H&A recorded 8.6 trillion won in sales, 940.3 billion won in operating profit, and 10.9% in profitability. AG recorded 3.5 trillion won in sales, 132.2 billion won in operating profit, and 3.8% in profitability. VS recorded 2.7 trillion won in sales, 52 billion won in operating profit and 2% in profitability. ES recorded 1.6 trillion won in sales, 12.8 billion won in operating profit, and 0.8% in profitability. 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 first 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 585.4 billion won in net income. Next on cash flow. Q1 cash flow from operating activities was negative 80.1 billion won and cash flow from investment activities was negative 1.5 trillion won. Accordingly, net cash flow was negative 1.53 trillion won. When reflecting cash flow from financial activities of 48.3 billion won, Cash balance at the end of Q1 decreased 1.48 trillion won from the previous quarter to stand at 7 trillion won. Next is the key financial position and indicators for the first quarter of 2024. As of the end of the first quarter, assets stood at 61.4 trillion won, liability at 36.9 trillion won, and equity at $24.5 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.