SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
6-K
REPORT OF
FOREIGN PRIVATE ISSUER
PURSUANT TO RULE
13a-16
OR
15d-16
UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of May 2018
LG Display
Co., Ltd.
(Translation of Registrants name into English)
LG Twin Towers, 128
Yeoui-daero,
Yeongdeungpo-gu,
Seoul
07336, Republic of Korea
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form
20-F
or Form
40-F.
Form
20-F ☒ Form
40-F ☐
Indicate by check mark if the registrant is submitting the Form
6-K
in paper as permitted by
Regulation
S-T
Rule 101(b)(1): ☐
Note:
Regulation
S-T
Rule 101(b)(1) only permits the submission in paper of a Form
6-K
if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form
6-K
in paper as permitted by
Regulation
S-T
Rule 101(b)(7): ☐
Note:
Regulation
S-T
Rule 101(b)(7) only permits the submission in paper of a Form
6-K
if submission to furnish a report or other document that the registration foreign private issuer must
furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrants home country), or under the rules of the home country exchange on which the
registrants securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrants security holders, and if discussing a material event, has already
been the subject of a Form
6-K
submission or other Commission filing on EDGAR.
Indicate by check
mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule
12g3-2(b)
under the Securities Exchange Act of
1934.
Yes ☐ No ☒
QUARTERLY REPORT
(From January 1, 2018 to March 31, 2018)
THIS IS A TRANSLATION OF THE QUARTERLY REPORT ORIGINALLY PREPARED IN KOREAN AND IS IN SUCH FORM AS REQUIRED BY THE KOREAN FINANCIAL SUPERVISORY COMMISSION.
IN THE TRANSLATION PROCESS, SOME PARTS OF THE REPORT WERE REFORMATTED, REARRANGED OR SUMMARIZED AND CERTAIN NUMBERS WERE ROUNDED FOR THE CONVENIENCE OF
READERS. REFERENCES TO Q1, Q2, Q3 AND Q4 OF A FISCAL YEAR ARE REFERENCES TO THE
THREE-MONTH
PERIODS ENDED MARCH 31, JUNE 30, SEPTEMBER 30 AND
DECEMBER 31, RESPECTIVELY, OF SUCH FISCAL YEAR.
UNLESS EXPRESSLY STATED OTHERWISE, ALL INFORMATION CONTAINED HEREIN IS PRESENTED
ON A
CONSOLIDATED BASIS IN ACCORDANCE WITH KOREAN INTERNATIONAL FINANCIAL REPORTING STANDARDS, OR K
-IFRS
, WHICH DIFFER IN CERTAIN RESPECTS FROM GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CERTAIN OTHER
COUNTRIES, INCLUDING THE UNITED STATES.
K-IFRS
ALSO DIFFERS IN CERTAIN RESPECTS FROM THE INTERNATIONAL FINANCIAL REPORTING STANDARDS AS ISSUED BY THE INTERNATIONAL ACCOUNTING STANDARDS BOARD. WE HAVE MADE NO
ATTEMPT TO IDENTIFY OR QUANTIFY THE IMPACT OF THESE DIFFERENCES IN THIS DOCUMENT.
Contents
2
3
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A.
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Name and contact information
|
The name of our company is
EL-GI
DISPLAY CHUSIK HOESA, which shall be LG Display Co., Ltd. in English.
Our
principal executive office is located at LG Twin Towers, 128
Yeoui-daero,
Yeongdeungpo-gu,
Seoul 07336, Republic of Korea, and our telephone number is
+82-2-3777-1010.
Our website address is
http://www.lgdisplay.com
.
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B.
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Domestic credit rating
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Subject instrument
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Month of rating
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Credit rating
(1)
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Rating agency (Rating range)
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Corporate bonds
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June 2016
|
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AA
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NICE Information Service Co., Ltd. (AAA ~ D)
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September 2016
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May 2017
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February 2018
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April 2016
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AA
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Korea Investors Service, Inc. (AAA ~ D)
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May 2017
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October 2017
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April 2016
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AA
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Korea Ratings Corporation (AAA ~ D)
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September 2016
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May 2017
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October 2017
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February 2018
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(1)
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Domestic corporate bond credit ratings are generally defined to indicate the following:
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Subject instrument
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Credit rating
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Definition
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AAA
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Strongest capacity for timely repayment.
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AA+/AA/AA-
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Very strong capacity for timely repayment. This capacity may, nevertheless, be slightly inferior than is the case for the highest rating category
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A+/A/A-
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Strong capacity for timely repayment. This capacity may, nevertheless, be more vulnerable to adverse changes in circumstances or in economic conditions than is the case for higher rating categories.
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BBB+/BBB/BBB-
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Capacity for timely repayment is adequate, but adverse changes in circumstances and in economic conditions are more likely to impair this capacity.
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Corporate bonds
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BB+/BB/BB-
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Capacity for timely repayment is currently adequate, but that there are some speculative characteristics that make the repayment uncertain over time.
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B+/B/B-
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Lack of adequate capacity for repayment and speculative characteristics. Interest payment in time of unfavorable economic conditions is uncertain.
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CCC
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Lack of capacity for even current repayment and high risk of default.
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CC
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Greater uncertainties than higher ratings.
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C
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High credit risk and lack of capacity for timely repayment.
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D
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Insolvency.
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4
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Subject instrument
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Month of rating
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Credit rating
(1)
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Rating agency (Rating range)
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June 2016
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A1
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Korea Ratings Corporation (A1 ~ D)
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June 2016
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A1
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NICE Information Service Co., Ltd. (A1 ~ D)
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September 2016
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A1
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NICE Information Service Co., Ltd. (A1 ~ D)
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Commercial paper
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September 2016
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A1
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Korea Ratings Corporation (A1 ~ D)
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May 2017
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A1
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Korea Investors Service, Inc. (A1 ~ D)
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May 2017
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A1
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Korea Ratings Corporation (A1 ~ D)
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October 2017
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A1
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Korea Investors Service, Inc. (A1 ~ D)
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December 2017
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A1
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Korea Ratings Corporation (A1 ~ D)
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(1)
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Domestic commercial paper credit ratings are generally defined to indicate the following:
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Subject instrument
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Credit rating
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Definition
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Commercial paper
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A1
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Timely repayment capability is at the highest level with extremely low investment risk and is stable such that it will not be influenced by any reasonably foreseeable changes in external factors.
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A2
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Strong capacity for timely repayment with very low investment risk. This capacity may, nevertheless, be slightly inferior than is the case for the highest rating category.
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A3
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Capacity for timely repayment is adequate with low investment risk. This capacity may, nevertheless, be somewhat influenced by sudden changes in external factors.
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B
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Capacity for timely repayment is acknowledged, but there are some speculative characteristics.
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C
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Capacity for timely repayment is questionable.
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D
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Insolvency.
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+ or - modifier can be attached to ratings A2 through B to differentiate ratings within broader rating categories.
5
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(1)
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Change in capital stock (as of March 31, 2018)
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There were no changes to our issued
capital stock during the annual reporting period ended March 31, 2018.
Not applicable.
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D.
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Voting rights (as of March 31, 2018)
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(Unit: share)
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Description
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Number of shares
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A. Total number of shares
issued
(1)
:
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Common shares
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(1)
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357,815,700
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Preferred shares
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B. Shares without voting rights:
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Common shares
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Preferred shares
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C. Shares subject to restrictions on voting rights pursuant to our articles of
incorporation:
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Common shares
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Preferred shares
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D. Shares subject to restrictions on voting rights pursuant to regulations:
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Common shares
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Preferred shares
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E. Shares with restored voting rights:
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Common shares
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Preferred shares
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Total number of issued shares with voting rights (=A B C D +
E):
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Common shares
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357,815,700
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Preferred shares
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(1)
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Authorized: 500,000,000 shares
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Dividends for the three most recent fiscal years
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Description (unit)
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2018 Q1
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2017
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2016
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Par value (Won)
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5,000
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5,000
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5,000
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Profit (loss) for the year (million
Won)
(1)
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(59,454
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)
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1,802,756
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906,713
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Earnings (loss) per share
(Won)
(2)
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(166
|
)
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5,038
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2,534
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Total cash dividend amount for the period (million Won)
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178,908
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178,908
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Total stock dividend amount for the period (million Won)
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Cash dividend payout ratio
(%)
(3)
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9.92
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%
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19.73
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%
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Cash dividend yield
(%)
(4)
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Common shares
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1.69
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%
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1.58
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%
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Preferred shares
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Stock dividend yield (%)
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Common shares
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Preferred shares
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Cash dividend per share (Won)
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Common shares
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500
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500
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Preferred shares
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Stock dividend per share (share)
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Common shares
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Preferred shares
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(1)
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Based on profit for the year attributable to the owners of the controlling company.
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(2)
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Earnings per share is based on par value of
W
5,000 per share and is calculated by dividing net income by weighted average number of common shares.
|
(3)
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Cash dividend payout ratio is the percentage that is derived by dividing total cash dividend by profit for the year attributable to the owners of the controlling company.
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(4)
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Cash dividend yield is the percentage that is derived by dividing cash dividend by the arithmetic average of the daily closing prices of our common shares during the
one-week
period ending two trading days prior to the closing of the register of shareholders for the purpose of determining the shareholders entitled to receive annual dividends.
|
6
We were incorporated in February 1985 under the
laws of the Republic of Korea. LG Electronics and LG Semicon transferred their respective LCD business to us in 1998, and since then, our business has been focused on the research, development, manufacture and sale of display panels, applying
technologies such as
TFT-LCD
and OLED.
As of March 31, 2018, in order to support our
business activities, we operated
TFT-LCD
and OLED production and research facilities in Paju and Gumi in Korea, and we have also established subsidiaries in the Americas, Europe and Asia.
As of March 31, 2018, our business consisted of the manufacture and sale of display and display related products utilizing
TFT-LCD,
OLED and other technologies under a single reporting business segment.
2018 Q1 consolidated operating
results highlights
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(Unit: In billions of Won)
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2018 Q1
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Display business
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Sales Revenue
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5,675
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Gross Profit
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542
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Operating Profit (loss)
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(98
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)
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(1)
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Industry characteristics and growth potential
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The entry barriers to manufacture display panels are relatively high due to the technology and capital intensive nature of the mass manufacturing process that is required to achieve economies of scale, among other
factors.
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While growth in the market for displays used in notebook computer, monitor and other traditional IT products has stagnated or declined, the market for small- and
medium-sized
displays (including those used in smartphones) in the rapidly evolving IT environment has shown steady growth. The display market for televisions has also shown steady growth mainly due to growing demand from developing countries as well as from
consumers in general for larger sized display panels. As for displays used in industrial, automobile and other value added products, we expect to see growth in these markets.
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The display panel business is highly cyclical and sensitive to fluctuations in the general economy. The industry experiences recurring volatility caused by imbalances between supply and demand due to capacity expansion
and changing production utilization rates within the industry.
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Macroeconomic factors and other causes of business cycles can affect the rate of growth in demand for display panels. Accordingly, if supply exceeds demand, average selling prices of display panels may decrease.
Conversely, if growth in demand outpaces growth in supply, average selling prices may increase.
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There is a concern over excessive competition and resulting adverse effects on supply and demand in the LCD industry amidst continued increases in new investments in manufacturing facilities and supply of panels. In
particular, Chinese manufacturers have continued to make further investments, which have been driven by local governments, despite concerns of over-investment in the LCD industry.
|
7
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Most display panel manufacturers are located in Asia.
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a.
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Korea: LG Display, Samsung Display, etc.
|
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b.
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Taiwan: AU Optronics, Innolux, CPT, HannStar, etc.
|
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c.
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Japan: Japan Display, Sharp, Panasonic LCD, etc.
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d.
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China: BOE, CSOT, CEC Panda, HKC, etc.
|
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Our worldwide market share of
large-sized
display panels (i.e., panels that are 9 inches or larger) based on revenue is as follows:
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2018 Q1
|
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2017
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2016
|
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Panels for Televisions
(1)
|
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26.8
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%
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28.1
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%
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28.2
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%
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Panels for Monitors
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37.2
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%
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36.3
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%
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36.6
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%
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Panels for Notebook Computers
|
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24.7
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%
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21.3
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%
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27.8
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%
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Panels for Tablet Computers
|
|
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36.5
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%
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29.1
|
%
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24.1
|
%
|
|
|
|
|
|
|
|
|
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Total
|
|
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29.8
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%
|
|
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29.2
|
%
|
|
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29.4
|
%
|
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|
|
|
|
|
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|
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|
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Source: Large-Area Display Market Tracker (IHS Technology)
(1)
|
Includes panels for public displays.
|
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|
|
Our ability to compete successfully depends on factors both within and outside our control, including product pricing, our relationship with customers, timely investments, adaptable production capabilities, development
of new and premium products through technological advances, competitive production costs, success in marketing to our
end-brand
customers, component and raw material supply costs, foreign exchange rates and
general economic and industry conditions.
|
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|
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In order to compete effectively, it is critical to be cost competitive and maintain stable and
long-term
relationships with customers which will enable us to be profitable even in
a buyers market.
|
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|
|
A substantial portion of our sales is attributable to a limited number of
end-brand
customers and their designated system integrators. The loss of these
end-brand
customers, as a result of customers entering into strategic supplier arrangements with our competitors or otherwise, would result in reduced sales.
|
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|
|
Developing new products and technologies that can be differentiated from those of our competitors is critical to the success of our business. It is important that we take active measures to protect our intellectual
property internationally by obtaining patents and undertaking monitoring activities in our major markets. It is also necessary to recruit and retain experienced key managerial personnel and skilled line operators.
|
|
|
|
As a leading technology innovator in the display industry, we continue to focus on delivering differentiated value to our customers by developing various technologies and products, including display panels with OLED,
IPS,
in-TOUCH
and other technologies. With respect to OLED panels, following our supply of the worlds first
55-inch
OLED 3D panels for televisions in January 2013,
we have supplied ultra-high definition (Ultra HD or UHD) OLED panels as well as Wallpaper and Crystal Sound OLED panels for televisions, flexible plastic OLED panels for smartphones, round OLED panels
for wearable devices among others and have shown that we are technologically a step ahead of the competition. With respect to
TFT-LCD
panels, we are leading the market with our differentiated products with IPS
technology, such as our ultra-large and high definition UHD television panels and 21:9 screen aspect ratio ultra-wide IPS curved monitors, and have prepared our production facilities to produce products with
in-TOUCH
technology.
|
8
|
|
|
Moreover, we entered into
long-term
sales contracts with major global firms to secure customers and expand partnerships for technology development.
|
For our continued growth, we are actively exploring
and preparing for new business opportunities that may arise in the changing market environment. As such, we are continually reviewing and looking at opportunities in the display and promising new industries.
3.
|
Major Products and Raw Materials
|
We manufacture
TFT-LCD
and OLED panels, of which a significant majority is sold overseas.
|
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(Unit: In billions of Won, except percentages)
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Business area
|
|
Sales
type
|
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Items (Market)
|
|
Usage
|
|
Major
trademark
|
|
Sales in 2018 Q1 (%)
|
Display
|
|
Product/ Service/ Other sales
|
|
Display panel (Overseas
(1)
)
|
|
Panels for notebook computers, monitors, televisions, smartphones, tablets, etc.
|
|
LG Display
|
|
5,241 (92.4%)
|
|
|
|
|
Display panel (Korea
(1)
)
|
|
Panels for notebook computers, monitors, televisions, smartphones, tablets, etc.
|
|
LG Display
|
|
434 (7.6%)
|
|
|
|
|
|
|
|
|
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Total
|
|
|
|
|
|
|
|
|
|
5,675 (100.0%)
|
|
|
|
|
|
|
|
|
|
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|
Period: January 1, 2018 ~ March 31, 2018.
|
(1)
|
Based on
ship-to-party.
|
|
B.
|
Average selling price trend of major products
|
While average selling
prices of LCD panels exhibited varying trends according to demand by product category, the average selling price of LCD panels per square meter of net display area shipped in the first quarter of 2018 decreased by approximately 11% compared to the
fourth quarter of 2017 due to a continued decline in average selling prices and a decrease in the proportion of small- and
medium-sized
panels for mobile products, which generally have higher selling prices
per square meter of net display area, in our product mix. There is no assurance that the average selling prices of LCD panels will not fluctuate in the future due to changes in market conditions.
|
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|
|
(Unit: US$ / m
2
)
|
|
Description
|
|
2018 Q1
|
|
|
2017 Q4
|
|
|
2017 Q3
|
|
|
2017 Q2
|
|
Display panel
(1)(2)
|
|
|
522
|
|
|
|
589
|
|
|
|
600
|
|
|
|
574
|
|
(1)
|
Quarterly average selling price per square meter of net display area shipped.
|
(2)
|
Excludes
semi-finished
products in the cell process.
|
Prices of major raw materials depend on
fluctuations in supply and demand in the market as well as on change in size and quantity of raw materials due to the increased production of
large-sized
panels.
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: In billions of Won, except percentages)
|
Business area
|
|
Purchase type
|
|
Items
|
|
Usage
|
|
Cost
(1)
|
|
|
Ratio (%)
|
|
|
Suppliers
|
Display
|
|
Raw materials
|
|
Backlights
|
|
Display panel
manufacturing
|
|
|
560
|
|
|
|
17.8
|
%
|
|
HeeSung Electronics, etc.
|
|
|
|
|
Polarizers
|
|
|
|
|
509
|
|
|
|
16.2
|
%
|
|
LG Chem, etc.
|
|
|
|
|
Glass
|
|
|
|
|
312
|
|
|
|
9.9
|
%
|
|
NEG, Asahi Glass, etc.
|
|
|
|
|
Printed circuit boards
|
|
|
|
|
376
|
|
|
|
12.0
|
%
|
|
Korea SMT, etc.
|
|
|
|
|
Others
|
|
|
|
|
1,385
|
|
|
|
44.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
|
|
3,141
|
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period: January 1, 2018 ~ March 31, 2018.
|
|
(1)
|
Based on total cost for purchase of raw materials which includes manufacturing and development costs, etc.
|
4.
|
Production and Equipment
|
|
A.
|
Production capacity and output
|
The table below sets forth the production capacity of our Gumi, Paju,
Guangzhou and Ochang facilities in the periods indicated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: 1,000 glass sheets)
|
|
Business area
|
|
Items
|
|
|
Location of facilities
|
|
2018 Q1
(1)
|
|
|
2017
(2)
|
|
|
2016
(2)
|
|
Display
|
|
|
Display panel
|
|
|
Gumi, Paju,
Guangzhou,
Ochang
|
|
|
2,422
|
|
|
|
10,538
|
|
|
|
9,906
|
|
(1)
|
Calculated based on the maximum monthly input capacity (based on glass input substrate size for eighth generation glass sheets) during the period multiplied by the number of months in the period (i.e., 3 months).
|
(2)
|
Calculated based on the maximum monthly input capacity (based on glass input substrate size for eighth-generation glass sheets) during the year multiplied by the number of months in a year (i.e., 12 months).
|
The table below sets forth the production output of our Gumi, Paju and
Guangzhou facilities in the periods indicated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: 1,000 glass sheets)
|
|
Business area
|
|
Items
|
|
|
Location of facilities
|
|
2018 Q1
|
|
|
2017
|
|
|
2016
|
|
Display
|
|
|
Display panel
|
|
|
Gumi, Paju,
Guangzhou, Ochang
|
|
|
2,291
|
|
|
|
9,262
|
|
|
|
8,996
|
|
|
|
|
Based on glass input substrate size for eighth-generation glass sheets.
|
|
B.
|
Production performance and utilization ratio
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: Hours, except percentages)
|
Production facilities
|
|
Available working hours
in 2018 Q1
|
|
Actual working hours in
2018 Q1
|
|
Average utilization ratio
|
Gumi
|
|
1,968
(1)
(82 days)
(2)
|
|
1,968
(1)
(82 days)
(2)
|
|
100.0%
|
Paju
|
|
2,160
(1)
(90 days)
(2)
|
|
2,160
(1)
(90 days)
(2)
|
|
100.0%
|
Guangzhou
|
|
2,160
(1)
(90 days)
(2)
|
|
2,160
(1)
(90 days)
(2)
|
|
100.0%
|
10
(1)
|
Based on the assumption that all 24 hours in a day have been fully utilized.
|
(2)
|
Number of days is calculated by averaging the number of working days for each facility.
|
In 2017, our total capital expenditures on a cash out basis was
W
6.6 trillion. In 2018, we plan to continue capital expenditures to invest in new OLED and oxide technologies and respond to increases in demand for
large-sized
panels.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: In billions of Won)
|
|
Business area
|
|
Sales types
|
|
Items (Market)
|
|
2018 Q1
|
|
2017
|
|
|
2016
|
|
Display
|
|
Products, etc.
|
|
Display panel
|
|
Overseas
(1)
|
|
5,241
|
|
|
25,794
|
|
|
|
24,679
|
|
|
|
|
|
|
|
Korea
(1)
|
|
434
|
|
|
1,996
|
|
|
|
1,825
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
5,675
|
|
|
27,790
|
|
|
|
26,504
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Based on
ship-to-party.
|
|
B.
|
Sales route and sales method
|
|
|
|
As of March 31, 2018, each of our television, IT, mobile and OLED businesses had individual sales and customer support functions.
|
|
|
|
Sales subsidiaries in the United States, Germany, Japan, Taiwan, China and Singapore perform sales activities and provide local technical support to customers.
|
|
Sales
|
of our products take place through one of the following two routes:
|
|
|
|
LG Display HQ and overseas manufacturing subsidiaries
g
Overseas sales subsidiaries (USA/Germany/Japan/Taiwan/China/Singapore), etc.
g
System integrators and
end-brand
customers
g
End users
|
|
|
|
LG Display HQ and overseas manufacturing subsidiaries
g
System integrators and
end-brand
customers
g
End users
|
|
(3)
|
Sales methods and sales terms
|
|
|
|
Direct sales and sales through overseas subsidiaries, etc. Sales terms are subject to change depending on the fluctuation in the supply and demand of LCD panels.
|
|
|
|
As part of our sales strategy, we have secured stable sales to major personal computer manufacturers and leading consumer electronics manufacturers globally, led the television market with our OLED and other market
leading television panels, increased the proportion of sales of our differentiated television panels, such as our Ultra HD and large television panels, in our product mix and strengthened sales of
high-resolution,
IPS, narrow bezel and other
high-end
display panels in the monitor, notebook computer and tablet markets.
|
11
|
|
|
In the smartphone, commercial products (including interactive whiteboards and video wall displays), industrial products (including aviation and medical equipment) and automobile displays segment, we have continued to
build a strong and diversified business portfolio by expanding our business with customers with a global reach on the strength of our differentiated products applying IPS, plastic OLED,
high-resolution,
high-reliability, Super Narrow bezel, in-TOUCH and other technologies.
|
|
|
|
Customers generally place purchase orders with us one month prior to delivery. Our customary practice for procuring orders from our customers and delivering our products to such customers is as follows:
|
|
|
|
Receive order from customer (overseas sales subsidiaries, etc.)
g
Headquarter is notified
g
Manufacture product
g
Ship product (overseas sales subsidiaries, etc.)
g
Sell product (overseas sales subsidiaries, etc.)
|
6.
|
Market Risks and Risk Management
|
The display industry continues to experience continued declines in the average
selling prices of
TFT-LCD
and OLED panels irrespective of cyclical fluctuations in the industry, and our margins would be adversely impacted if prices decrease faster than we are able to reduce our costs.
The display industry is highly competitive. We have experienced pressure on the prices and margins of our major products due largely to
additional industry capacity from panel manufacturers in Korea, Taiwan, China and Japan coupled with changes in the production mix of such manufacturers.
Our ability to compete successfully depends on factors both within and outside our control, including product pricing, performance and
reliability, timely investments, adaptable production capabilities, utilization of differentiated technologies in product development, success or failure of our
end-brand
customers in marketing their brands
and products, component and raw material supply costs, and general economic and industry conditions. We cannot provide assurance that we will be able to compete successfully with our competitors on these fronts and, as a result, we may be unable to
sustain our current market position.
Our results of operations are subject to exchange rate fluctuations. To the extent that we incur
costs in one currency and generate sales in a different currency, our profit margins may be affected by changes in the exchange rates between the two currencies. Our sales of display panels are denominated mainly in U.S. dollars, whereas our foreign
currency denominated purchases of raw materials are denominated mainly in U.S. dollars and Japanese Yen. Seeking to achieve stable management, we take every precaution in our foreign currency risk management to minimize the risk of foreign currency
fluctuations on our foreign currency denominated assets and liabilities.
As the average selling prices of
TFT-LCD
and OLED panels can continue to decline over time irrespective of
industry-wide
cyclical fluctuations, we may find it hard to manage risks associated with
certain factors that are outside our control. However, we counteract such declines in average selling prices by increasing the proportion of high value added panels in our product mix while also implementing various cost reduction measures. In
addition, in order to manage our risk against foreign currency fluctuations, we continually monitor our currency position and risk, and when needed, we may from time to time enter into
cross-currency
interest
rate swap contracts and foreign currency forward contracts.
12
|
|
|
We are exposed to currency risks on sales, purchases and borrowings that are denominated in currencies other than in Won, our functional currency. These currencies are primarily the U.S. dollar, the Japanese Yen and the
Chinese Yuan.
|
|
|
|
Interest on borrowings is denominated in the currency of the borrowing. Generally, borrowings are denominated in currencies that match the cash flows generated by our underlying operations, primarily in Won, the U.S.
dollar and the Chinese Yuan.
|
|
|
|
In respect of other monetary assets and liabilities denominated in foreign currencies, we ensure that our net exposure is kept to an acceptable level by buying or selling foreign currencies at spot rates, when
necessary, to address
short-term
imbalances.
|
|
|
|
As of March 31, 2018, we had no outstanding amounts to be settled under any foreign currency derivative instruments.
|
|
|
|
Our exposure to interest rate risks relates primarily to our floating rate long term loan obligations. We have established and are managing interest rate risk policies to minimize uncertainty and costs associated with
interest rate fluctuations by monitoring cyclical interest rate fluctuations and enacting countermeasures.
|
|
|
|
As of March 31, 2018, we have entered into an aggregate of
W
350 billion in interest rate swap agreements with Shinhan Bank and NongHyup Bank, for which we have not applied
hedge accounting.
|
We recognized a loss on valuation of derivative instruments in the amount of
W
242 million with respect to interest rate derivative instruments held as of March 31, 2018.
Our material contracts, other than contracts entered into in the
ordinary course of business, are set forth below:
|
|
|
|
|
|
|
Type of agreement
|
|
Name of party
|
|
Term
|
|
Content
|
Technology licensing agreement
|
|
Semiconductor Energy Laboratory
|
|
October 2005 ~
|
|
Patent licensing of LCD and OLED related technology
|
|
|
|
|
|
|
Hewlett-Packard
|
|
January 2011 ~
|
|
Patent licensing of
semi-conductor
device technology
|
|
|
|
|
|
|
Ignis Innovation, Inc.
|
|
July 2016 ~
|
|
Patent licensing of OLED related technology
|
|
|
|
|
Technology licensing/supply agreement
|
|
HannStar Display Corporation
|
|
December 2013 ~
|
|
Patent
cross-licensing
of LCD technology
|
|
|
|
|
|
|
AU Optronics Corporation
|
|
August 2011~
|
|
Patent
cross-licensing
of LCD technology
|
|
|
|
|
|
|
Innolux Corporation
|
|
July 2012 ~
|
|
Patent
cross-licensing
of LCD technology
|
|
|
|
|
|
|
Universal Display Corporation
|
|
January 2015 ~ December 2022
|
|
Patent cross-licensing of OLED related technology
|
13
9.
|
Research & Development
|
|
A.
|
Summary of
R&D-related
expenditures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: In millions of Won, except percentages)
|
|
Items
|
|
2018 Q1
|
|
2017
|
|
|
2016
|
|
Material Cost
|
|
119,419
|
|
|
646,622
|
|
|
|
677,423
|
|
Labor Cost
|
|
186,872
|
|
|
668,429
|
|
|
|
479,650
|
|
Depreciation Expense
|
|
95,172
|
|
|
298,383
|
|
|
|
136,826
|
|
Others
|
|
87,637
|
|
|
298,256
|
|
|
|
129,348
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
R&D-Related
Expenditures
|
|
489,100
|
|
|
1,911,690
|
|
|
|
1,423,247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling & Administrative Expenses
|
|
215,169
|
|
|
917,645
|
|
|
|
880,794
|
|
Accounting
Treatment
(1)
|
|
Manufacturing Cost
|
|
183,827
|
|
|
786,494
|
|
|
|
220,165
|
|
|
|
Development Cost (Intangible Assets)
|
|
90,104
|
|
|
207,551
|
|
|
|
322,288
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
R&D-Related
Expenditures / Revenue Ratio
(Total
R&D-Related
Expenditures ÷ Revenue for the period × 100)
|
|
8.6%
|
|
|
6.9
|
%
|
|
|
5.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
For accounting treatment purposes, selling & administrative expenses are presented as research and development expenses in our statements of comprehensive income, net of amortization of capitalized intangible
asset development costs.
|
Achievements in 2016
|
(1)
|
Developed the worlds narrowest, at the time, bezel videowall product
(55-inch/49-inch
FHD, bezel to bezel 1.8mm)
|
|
|
|
Delivered 0.9mm even bezel, four-sided borderless product (bezel to bezel 1.8mm)
|
|
(2)
|
Developed the worlds first ultra-stretch format display product
(86-inch,
58:9 screen aspect ratio)
|
|
|
|
Developed new display panel size and screen aspect ratio
(86-inch,
58:9 screen aspect ratio)
|
|
|
|
Applied next-generation stain (per pixel) offset technology
|
|
(3)
|
Developed the worlds first ultra-large display product utilizing data single bank and GIP technology
(86-inch
Ultra HD)
|
|
|
|
Achieved cost-competitiveness by developing worlds first ultra-large display product utilizing data single bank and GIP technology
|
|
(4)
|
Developed the worlds first
in-TOUCH
monitor product
(23-inch)
|
|
|
|
Improved touch functionality and strengthened cost-competitiveness by applying the worlds first
in-TOUCH
technology to monitor display products
|
|
|
|
Simplified customer software configuration management by providing touch total solution
|
|
(5)
|
Developed ultra-slim OLED television display product applying high dynamic range
(65-inch,
800 nit luminance, 2.52 mm module thickness)
|
|
|
|
Applied high dynamic range (HDR) technology to achieve 800 nit peak luminance and improved display quality
|
|
|
|
Achieved module thickness of 2.52mm (without back cover) and 5.92mm (with back cover)
|
|
(6)
|
Developed combined
5.3-inch
QHD
in-TOUCH
+ 3D cover glass product for LG Electronics
|
|
|
|
Developed world class smartphone product (G5) through collaboration with other LG Group companies
|
|
|
|
Strengthened competitiveness of design by achieving processability and productivity for 0.4t 3D cover glass
|
|
|
|
Improved power consumption of AoD Mode from Self Font Generation technology and operation optimization
|
14
|
(7)
|
Developed the worlds first large-scale outdoor high luminance 3000 nit product
(75-inch
Ultra HD)
|
|
|
|
Developed the worlds first large-scale outdoor
75-inch
Ultra HD, high luminance 3000 nit product
|
|
|
|
Achieved cost competitiveness and power consumption reduction through utilization of high transmittance M+ panel
|
|
(8)
|
Developed the worlds first FHD/Ultra HD multi-input Interactive Whiteboard product
(75-inch
Ultra HD)
|
|
|
|
Strengthened product competitiveness through delivery of customer FHD/Ultra HD selective input functionality
|
|
(9)
|
Developed 4.9mm depth Art Slim2 Ultra HD television
(55-inch/65-inch
Ultra HD)
|
|
|
|
Strengthened design competitiveness through delivery of ultra-slim product with application of Glass Light Guide Plate
|
|
(10)
|
Developed the worlds largest 21:9 screen aspect ratio curved monitor
(37.5-inch
UltraWide Quad HD (WQHD)+)
|
|
|
|
Continued pioneering of the market with the worlds largest 21:9 screen aspect ratio IPS curved monitor lineup
(37.5-inch,
2300R curvature radius, 44mm curvature depth)
|
|
|
|
Established flagship line through application of new high definition technology (WQHD+, 3840 x 1600 resolution)
|
|
|
|
Improved panel transmittance and backlight bleeding through our first-time application of a
Super-IPS
COT panel structure to monitor models
|
|
(11)
|
Developed the worlds first
in-TOUCH
GIP/DRD notebook product
(15.6-inch
FHD)
|
|
|
|
Strengthened competitiveness through application of GIP/DRD technology to
FHD-quality
notebook
in-TOUCH
products
|
|
(12)
|
Developed a transparent
32-inch
FHD product
|
|
|
|
Achieved high transmittance of transparent panel through application of RGBW(M+) panel technology
|
|
(13)
|
Developed the worlds first Light Absorption Polarizer (LAP) product
(65-inch/60-inch
Ultra HD)
|
|
|
|
Developed differentiated wide color gamut solution
|
|
(14)
|
Developed the worlds first UHD DRD product
(50-inch
UHD)
|
|
|
|
Utilized UHD RGBW(M+) pixel structure-based DRD technology to strengthen product competitiveness and optimize picture quality (high definition, high luminance, low energy consumption and HDR)
|
|
(15)
|
Developed a
5.7-inch
QHD flexible display product
|
|
|
|
Developed a flexible display smartphone product through collaboration with other LG Group companies
|
|
|
|
Reduced the lower bezel size by 0.59mm and improved power consumption by applying VESA Display Stream Compression 1.1
|
|
(16)
|
Developed the worlds first wallpaper OLED television product
(65-inch
Ultra HD)
|
|
|
|
Achieved an ultra-slim wallpaper-style design that completely sticks to walls
(65-inch,
3.9 mm hindmost thickness, 7.4 kg)
|
|
|
|
Achieved long-distance signal and power transmission technology for the separation of the driver circuit
|
Achievements in 2017
|
(1)
|
Developed
5.7-inch
QHD+ full vision display (LG Electronics)
|
|
|
|
Developed a full vision display smartphone product (G6) through strategic collaboration with other LG Group companies
|
|
|
|
Applied first 18:9 screen aspect ratio with
4-corner
round display
|
|
(2)
|
Developed mobile LTPS 30Hz product (SH
5.1-inch
FHD)
|
|
|
|
Secured 30Hz
low-frequency
drive technology based on LTPS
TFT-LCD
|
|
|
|
Reduced logic power consumption through 30Hz
low-frequency
drive (reduced from 96mW to 69mW on 5.1-inch FHD)
|
15
|
(3)
|
Developed and released the worlds first Crystal Sound OLED, or CSO, television product
|
|
|
|
Released product with a new platform concept through development of OLED panel product with integrated speakers
|
|
|
|
Delivered OLED television product that achieves differentiated value not only in picture quality and design, but also sound quality
|
|
(4)
|
Developed notebook oxide product
(13.9-inch,
Ultra HD)
|
|
|
|
Achieved high definition/narrow bezel product through application of oxide BCE GIP technology
|
|
|
|
Delivered low power consumption product through application of low refresh rate, or LRR, technology
|
|
(5)
|
Developed medical monitor product for surgical endoscope
(27.0-inch,
Ultra HD)
|
|
|
|
Newly entered the medical devices market through development and production of medical monitor product for surgical endoscope
|
|
|
|
Achieved high definition (3,840 x 2,160), high luminance (800 nit) and high contrast ratio (1,300:1)
|
|
|
|
Implemented coverglass direct bonding applying our own manufacturing processes (M6 line)
|
|
(6)
|
Developed the worlds first four-side borderless monitor with a resolution of 8K4K
(31.5-inch
8K4K oxide)
|
|
|
|
Pioneered Ultra HD Premium MNT market through development of the worlds first four-side borderless monitor with a resolution of 8K4K
|
|
|
|
Delivered Ultra HD based on oxide GIP (280 PPI with a resolution of 7680x4320)
|
|
|
|
Delivered wide color gamut (Adobe RGB 100%/DCI 98%), four-side borderless
|
|
(7)
|
Developed the worlds largest automotive Center Information Display (CID) product
(15.4-inch
Widescreen Ultra Extended Graphics Array (WUXGA))
|
|
|
|
Developed the worlds largest auto component display in the automotive industry
|
|
|
|
Guaranteed the first 1000hr reliability in the automotive industry
|
|
(8)
|
Developed the worlds first
88-inch
Ultra Stretch display product
|
|
|
|
Strengthened competitiveness through application of smart (digital) stepper
|
|
(9)
|
Developed products utilizing
U-IPS
(75-inch/65-inch/55-inch/49-inch,
Ultra HD)
|
|
|
|
Utilized
U-IPS
technology to strengthen product competitiveness by improving panel transmittance rate and reflectivity
|
|
(10)
|
Developed the worlds first
65-inch
UHD OLED television product utilizing GIP
|
|
|
|
Strengthened product competitiveness through application of the worlds first oxide based UHD GIP technology
|
Achievements in 2018
|
(1)
|
Developed the worlds first glass-integrated LCD television product (Art Glass Series)
|
|
|
|
Achieved LCD modular appearance and simplicity in design by using glass material throughout product (including the panel, light guide plate and back cover)
|
|
|
|
Strengthened competitiveness of frameless design by decreasing bezel size from 7.8mm to 5.9mm
|
|
(2)
|
Developed our first
5.8-inch
Ultra HD Mobile 4K product
|
|
|
|
Developed our first Ultra HD mobile product
|
|
|
|
Achieved high luminance, low power consumption and HD resolution by applying Ultra HD RGBW (M+) pixel structure
|
|
(3)
|
Developed the worlds first
5.8-inch
mobile FHD product applying M+
|
|
|
|
Our first product applying camera notch concept technology
|
10.
|
Intellectual Property
|
As of March 31, 2018, our
cumulative patent portfolio (including patents that have already expired) included a total of 35,195 patents, consisting of 16,394 in Korea and 18,801 in other countries.
16
11.
|
Environmental and Safety Matters
|
We are subject to a variety
of environmental laws and regulations, and we may be subject to fines or restrictions that could cause our operations to be interrupted. Our manufacturing processes generate worksite waste, including water and air pollutants, at various stages in
the manufacturing process, and we are subject to relevant laws and regulations in each area of the environment, including with respect to the treatment of chemical
by-products.
We have installed various types
of
anti-pollution
equipment, consistent with environmental standards, for the treatment of chemical waste and equipment for the recycling of treated waste water at our various facilities. However, we cannot
provide assurance that environmental claims will not be brought against us or that the local or national governments will not take steps toward adopting more stringent environmental standards. Any failure on our part to comply with any present or
future environmental regulations could result in the assessment of damages or imposition of fines against us, suspension of production or a cessation of operations. In addition, environmental regulations could require us to acquire costly equipment
or to incur other significant compliance expenses that may materially and negatively affect our financial condition and results of operations.
In accordance with the Framework Act on Low Carbon, Green Growth, we implemented the greenhouse gas emission and energy consumption target
system from 2012 to 2014. In 2015, we implemented the greenhouse gas trading system, under which we are responsible to meet our emission targets based on the emission credits allocated to us by the Ministry of Environment of the Korean government.
As a result, we have been investing in additional equipment and there may be other costs associated with meeting reduction targets, which may have a negative effect on our profitability or production activities.
In connection with the greenhouse gas emission and energy reduction target system, we submitted a statement of our domestic emissions and
energy usage for 2017 to the Korean government in March 2018 after it was certified by BSI Korea, a
government-designated
certification agency. The table below sets forth yearly levels of our greenhouse gases
emissions and energy usage in the statement submitted to the Korean government:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: thousand tonnes of CO
2
equivalent; Tetra Joules)
|
|
Category
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
Greenhouse gases
|
|
|
6,303
|
|
|
|
5,851
|
|
|
|
7,348
|
|
Energy
|
|
|
63,451
|
|
|
|
60,423
|
|
|
|
60,146
|
|
Operations at our manufacturing plants are subject to regulation and periodic scheduled and unscheduled
on-site
inspections by the Ministry of Environment and local environmental protection authorities. We believe that we have adopted adequate
anti-pollution
measures and have
minimized our impact on the environment by improving existing and developing new technologies for the effective maintenance of environmental protection standards consistent with local industry practice. In addition, we have continually monitored,
and we believe that we are in compliance in all material respects with, the applicable environmental laws and regulations in Korea. Expenditures related to such compliance may be substantial. Such expenditures are generally included in capital
expenditures. As required by Korean law, we employ licensed environmental specialists to manage our water and air pollution, toxic materials and waste. In December 2013, to ensure safe water quality and reduce costs, we entered into a contract with
a specialist company to operate our waste water treatment facilities. In stages beginning in November 1997, we have obtained environmental management system ISO 14001 certifications for our domestic panel and module production facilities and our
overseas module production plants in Nanjing, Yantai and Guangzhou, China, and with respect to our domestic panel and module production plants, we received ISO 50001 certification in December 2013 for our energy management system.
17
In addition, in August 2014, GP1, our newest eighth-generation panel fabrication facility located
in Guangzhou, China, was the first electronics plant in China to receive the Green Plant designation under Chinas Green China Policy, in addition to receiving ISO 14001, ISO 50001, OHSAS 18001, ISO 9001, PAS 2050 and ISO
14064-1
certifications. Furthermore, with respect to our production facilities in Gumi, we have been certified by the Ministry of Environment as a Green Company for P1 and our Gumi module production
plant since 1997, P2 and P3 since 2006 and P4, P5 and P6 since 2008. In recognition of our efforts to reduce greenhouse gas emissions, we were awarded a commendation from the Minister of Environment in the efforts against climate change category in
the 2013 Green Management Awards, which was jointly hosted by the Ministry of Environment and the Ministry of Trade, Industry & Energy. In addition, in recognition of our efforts to improve recycling and reduce waste, we received a citation
in 2014 for being a leading recycling company from the Prime Minister of Korea and, in recognition of our continued water conservation activities (reuse system investments, etc.) and greenhouse gas emission reduction activities (process gas and
energy reduction, etc.), we attained the highest level, Leadership A, and received the grand prize award at the CDP Water Korea Best Awards in 2016 from the Carbon Disclosure Project, which was presided over by the Carbon Disclosure Project Korea
Committee. We also attained a Leadership A in the climate change information technology sector and received a carbon management honors award. Our continued efforts to reduce greenhouse gas emissions was recognized again in 2017 by becoming the only
domestic information technology company to attain the Leadership A level and again receiving carbon management honors by ranking in the top five among all eligible companies. In May 2017, we were awarded a commendation from the Minister of
Environment for having scored the highest grade among companies in the
low-
and medium-volume pollutant emitters category that had entered into voluntary agreements with the Metropolitan Air Quality Management
Office, in recognition of having successfully met our voluntary targets for reduction of air pollutants as well as our overall efforts to enhance our relevant facilities and operational systems. In addition, in recognition of efficient control,
management and operating systems implemented in our manufacturing facilities, we received the
top-level
certification, Level 1, in 2017 under the Factory Energy Management System evaluation presided by
the Korea Energy Agency. Furthermore, in November 2017, we received the highest commendation, the Presidential Award, in the Korean Energy Efficiency Awards presided by the Ministry of Industry, Trade and Energy in recognition of our energy
management practices and energy saving measures, and we also obtained a certificate of excellence in the Energy Management System Evaluation.
In the case of the European Unions Restriction of Hazardous Substances (RoHS) Directive 2011/65/EU, with the adoption of Directive (EU)
2015/863 in 2016, four additional substances (four phthalate substances) will be added to the six already restricted substances and the additional restrictions are scheduled to come into effect on July 22, 2019. In order to address the latent
risk elements of the four phthalate substances scheduled to be restricted in 2019 and to establish a more stable management system, we implemented in 2016 a preemptive response process with respect to such four phthalate substances. In implementing
this process, we collaborated with external agencies to ascertain regulatory trends and establish our response strategy, and we formulated and applied effective management measures through the collaborative efforts of our development, procurement
and quality teams. Beryllium (Be) was not designated internationally as a mandatorily restricted substance but has continued to be the subject of discussion for restriction, and certain of our customers have designated it as a restricted substance
not to be used in products. Accordingly, we have completed verification of the parts used in products for customers who have banned the use of Beryllium. We have also conducted verification of the parts used in products for all customers who are
expected to implement a ban and we have established a Beryllium verification process for parts in development. Through such efforts, we have established a voluntary hazardous substance response process that can be expanded to products for all
customers, not only those who have requested a response.
In October 2005, we became the first display panel company to receive
accreditation as an International Accredited Testing Laboratory by the Korea Laboratory Accreditation Scheme, which is operated by the Korean Ministry of Trade, Industry & Energy. In September 2006, we received international accreditation
from TUV SUD, EUs German accreditation agency, as a RoHS testing laboratory. Our efforts to keep pace with the increasingly stringent accreditation standards and to receive and maintain such accreditations are part of our
on-going
efforts to systematically monitor environmentally controlled substances in our component parts inventory. Moreover, we participated in reforming IEC 62321, an international testing standard published by the
International Electrotechnical Commission and used by RoHS, and the commission adopted our
halogen-free
combustion ion chromatography method in as IEC
62321-3-2,
which was published in June 2013. In 2017, in a joint effort with the global product testing/accreditation agency SGS, we became the first display panel company to develop Eco Label, an
environmentally friendly accreditation program for television display modules, and received the SGS Eco Label accreditation for our OLED, IPS Nano Color and Art Glass television models. For the IPS Nano Color for LCD, we received the
Quality & Performance Mark from Intertek, a global product testing/accreditation agency, by applying a technology to eliminate cadmium (Cd) and indium phosphide (InP).
In December 2016, we were assessed a fine of
W
0.2 million, which we subsequently paid, for failure to
meet certain reporting obligations under the Industrial Safety and Health Act. To prevent such violations from occurring again, we have strengthened our monitoring process and management and employee education training initiatives.
18
In June 2017, we were assessed a fine of
W
1 million, which
we subsequently paid, for failure to meet certain waste disposal subcontractor requirements under the Waste Management Act. To prevent such violations from occurring again, we are strengthening the periodic evaluation process for our waste
management subcontractors.
In June 2017, we were audited by the Ministry of Employment and Labor in connection with the occurrence of a
safety accident and found to be in violation of certain provisions of the Industrial Safety and Health Act relating to supervisory obligations. As a result, we were issued a corrective order and assessed a fine of
W
2.4 million. In addition, the trial court assessed a fine of
W
0.5 million on each of us and our chief production officer on the basis of certain other applicable
provisions of the Industrial Safety and Health Act. Relevant authorities are currently conducting further investigations. In order to prevent such accidents from occurring again, we are strengthening our safety management standards and training for
our employees.
In January 2018, we were audited by the Ministry of Employment and Labor in connection with the occurrence of another
safety accident and found to be in violation of certain provisions of the Industrial Safety and Health Act relating to supervisory obligations. As a result, we were issued a corrective order and assessed a fine of
W
14.4 million. Relevant authorities are currently conducting further investigations. In order to prevent such accidents from occurring again, we are strengthening our safety management standards and training
for our employees.
Also in January 2018, the government of
Gyeong-gi
Province issued a warning
and assessed a fine of
W
1 million on us, which we subsequently paid, for the failure to comply with certain requirements relating to air pollutant emission and prevention facilities under the Air Quality
Management Act. To prevent such violations from occurring again, we have shortened the air pollutant emission maintenance reporting period and strengthened the verification process for relevant data.
In March 2018, we were audited by the Ministry of Employment and Labor in connection with our health and safety training practices, and we
were found to have omitted requisite health and safety training sessions for certain employees in our P9 facilities in 2016 and 2017. As a result, we were assessed a fine of
W
6.95 million, which we subsequently
paid, and have strengthened our efforts to promote health and safety training programs in advance as well as our management and supervision activities to ensure such programs are conducted.
12.
|
Financial Information
|
|
A.
|
Financial highlights (Based on consolidated
K-IFRS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: In millions of Won)
|
|
Description
|
|
As of March 31, 2018
|
|
|
As of December 31, 2017
|
|
|
As of December 31, 2016
|
|
Current assets
|
|
|
9,898,586
|
|
|
|
10,473,703
|
|
|
|
10,484,186
|
|
Quick assets
|
|
|
7,548,201
|
|
|
|
8,123,619
|
|
|
|
8,196,401
|
|
Inventories
|
|
|
2,350,385
|
|
|
|
2,350,084
|
|
|
|
2,287,785
|
|
Non-current
assets
|
|
|
20,096,685
|
|
|
|
18,685,984
|
|
|
|
14,400,150
|
|
Investments in equity accounted investees
|
|
|
119,698
|
|
|
|
122,507
|
|
|
|
172,683
|
|
Property, plant and equipment, net
|
|
|
17,525,116
|
|
|
|
16,201,960
|
|
|
|
12,031,449
|
|
Intangible assets
|
|
|
912,202
|
|
|
|
912,821
|
|
|
|
894,937
|
|
Other
non-current
assets
|
|
|
1,539,669
|
|
|
|
1,448,696
|
|
|
|
1,301,081
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
29,995,271
|
|
|
|
29,159,687
|
|
|
|
24,884,336
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
9,548,591
|
|
|
|
8,978,682
|
|
|
|
7,058,219
|
|
Non-current
liabilities
|
|
|
5,621,044
|
|
|
|
5,199,495
|
|
|
|
4,363,729
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
15,169,635
|
|
|
|
14,178,177
|
|
|
|
11,421,948
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
|
1,789,079
|
|
|
|
1,789,079
|
|
|
|
1,789,079
|
|
Share premium
|
|
|
2,251,113
|
|
|
|
2,251,113
|
|
|
|
2,251,113
|
|
Retained earnings
|
|
|
10,379,127
|
|
|
|
10,621,571
|
|
|
|
9,004,283
|
|
Other equity
|
|
|
(182,040
|
)
|
|
|
(288,280
|
)
|
|
|
(88,478
|
)
|
Non-controlling
interest
|
|
|
588,357
|
|
|
|
608,027
|
|
|
|
506,391
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity
|
|
|
14,825,636
|
|
|
|
14,981,510
|
|
|
|
13,462,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: In millions of Won, except for per share data and number of
consolidated entities)
|
|
Description
|
|
For the three months ended
March 31, 2018
|
|
|
For the year ended
December 31, 2017
|
|
|
For the year ended
December 31, 2016
|
|
Revenue
|
|
|
5,675,164
|
|
|
|
27,790,216
|
|
|
|
26,504,074
|
|
Operating profit (loss)
|
|
|
(98,323
|
)
|
|
|
2,461,618
|
|
|
|
1,311,416
|
|
Operating profit (loss) from continuing operations
|
|
|
(48,982
|
)
|
|
|
1,937,052
|
|
|
|
931,508
|
|
Profit (loss) for the period
|
|
|
(48,982
|
)
|
|
|
1,937,052
|
|
|
|
931,508
|
|
Profit (loss) attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Company
|
|
|
(59,454
|
)
|
|
|
1,802,756
|
|
|
|
906,713
|
|
Non-controlling
interest
|
|
|
10,472
|
|
|
|
134,296
|
|
|
|
24,795
|
|
Basic earnings (loss) per share
|
|
|
(166
|
)
|
|
|
5,038
|
|
|
|
2,534
|
|
Diluted earnings (loss) per share
|
|
|
(166
|
)
|
|
|
5,038
|
|
|
|
2,534
|
|
Number of consolidated entities
|
|
|
20
|
|
|
|
20
|
|
|
|
19
|
|
|
B.
|
Financial highlights (Based on separate
K-IFRS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: In millions of Won)
|
|
Description
|
|
As of March 31, 2018
|
|
|
As of December 31, 2017
|
|
|
As of December 31, 2016
|
|
Current assets
|
|
|
7,279,054
|
|
|
|
8,381,074
|
|
|
|
8,712,575
|
|
Quick assets
|
|
|
5,628,998
|
|
|
|
6,698,829
|
|
|
|
7,005,592
|
|
Inventories
|
|
|
1,650,056
|
|
|
|
1,682,245
|
|
|
|
1,706,983
|
|
Non-current
assets
|
|
|
18,874,489
|
|
|
|
17,028,341
|
|
|
|
13,100,175
|
|
Investments
|
|
|
3,269,871
|
|
|
|
2,683,941
|
|
|
|
2,656,026
|
|
Property, plant and equipment, net
|
|
|
13,669,128
|
|
|
|
12,487,001
|
|
|
|
8,757,973
|
|
Intangible assets
|
|
|
738,473
|
|
|
|
731,373
|
|
|
|
673,966
|
|
Other
non-current
assets
|
|
|
1,197,017
|
|
|
|
1,126,026
|
|
|
|
1,012,210
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
26,153,543
|
|
|
|
25,409,415
|
|
|
|
21,812,750
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
7,825,127
|
|
|
|
7,394,605
|
|
|
|
6,176,344
|
|
Non-current
liabilities
|
|
|
4,762,552
|
|
|
|
4,185,551
|
|
|
|
3,400,959
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
12,587,679
|
|
|
|
11,580,156
|
|
|
|
9,577,303
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
|
1,789,079
|
|
|
|
1,789,079
|
|
|
|
1,789,079
|
|
Share premium
|
|
|
2,251,113
|
|
|
|
2,251,113
|
|
|
|
2,251,113
|
|
Retained earnings
|
|
|
9,525,672
|
|
|
|
9,789,067
|
|
|
|
8,195,255
|
|
Other equity
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity
|
|
|
13,565,864
|
|
|
|
13,829,259
|
|
|
|
12,235,447
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: In millions of Won, except for per share data)
|
|
Description
|
|
For the three months ended
March 31, 2018
|
|
|
For the year ended
December 31, 2017
|
|
|
For the year ended
December 31, 2016
|
|
Revenue
|
|
|
5,154,261
|
|
|
|
24,419,295
|
|
|
|
25,856,426
|
|
Operating profit (loss)
|
|
|
(253,621
|
)
|
|
|
709,138
|
|
|
|
770,856
|
|
Operating profit (loss) from continuing operations
|
|
|
(80,364
|
)
|
|
|
967,078
|
|
|
|
968,209
|
|
Profit (loss) for the period
|
|
|
(80,364
|
)
|
|
|
967,078
|
|
|
|
968,209
|
|
Basic earnings (loss) per share
|
|
|
(225
|
)
|
|
|
2,703
|
|
|
|
2,706
|
|
Diluted earnings (loss) per share
|
|
|
(225
|
)
|
|
|
2,703
|
|
|
|
2,706
|
|
|
C.
|
Consolidated subsidiaries (as of March 31, 2018)
|
|
|
|
|
|
|
|
|
|
Company Interest
|
|
Primary Business
|
|
Location
|
|
Equity
|
|
LG Display America, Inc.
|
|
Sales
|
|
U.S.A.
|
|
|
100
|
%
|
LG Display Japan Co., Ltd.
|
|
Sales
|
|
Japan
|
|
|
100
|
%
|
LG Display Germany GmbH
|
|
Sales
|
|
Germany
|
|
|
100
|
%
|
LG Display Taiwan Co., Ltd.
|
|
Sales
|
|
Taiwan
|
|
|
100
|
%
|
LG Display Nanjing Co., Ltd.
|
|
Manufacturing
|
|
China
|
|
|
100
|
%
|
LG Display Shanghai Co., Ltd.
|
|
Sales
|
|
China
|
|
|
100
|
%
|
LG Display Poland Sp. zo.o.
|
|
Manufacturing
|
|
Poland
|
|
|
100
|
%
|
LG Display Guangzhou Co., Ltd.
|
|
Manufacturing
|
|
China
|
|
|
100
|
%
|
LG Display Shenzhen Co., Ltd.
|
|
Sales
|
|
China
|
|
|
100
|
%
|
LG Display Singapore Pte. Ltd.
|
|
Sales
|
|
Singapore
|
|
|
100
|
%
|
L&T Display Technology (Fujian) Limited
|
|
Manufacturing and sales
|
|
China
|
|
|
51
|
%
|
LG Display Yantai Co., Ltd.
|
|
Manufacturing
|
|
China
|
|
|
100
|
%
|
LG Display (China) Co., Ltd.
|
|
Manufacturing and sales
|
|
China
|
|
|
70
|
%
|
Nanumnuri Co., Ltd.
|
|
Workplace services
|
|
Korea
|
|
|
100
|
%
|
Unified Innovative Technology, LLC
|
|
Managing intellectual property
|
|
U.S.A.
|
|
|
100
|
%
|
Global OLED Technology LLC
|
|
Managing intellectual property
|
|
U.S.A.
|
|
|
100
|
%
|
LG Display Guangzhou Trading Co., Ltd.
|
|
Sales
|
|
China
|
|
|
100
|
%
|
LG Display Vietnam Haiphong Co., Ltd.
|
|
Manufacturing
|
|
Vietnam
|
|
|
100
|
%
|
Suzhou Lehui Display Co., Ltd.
|
|
Manufacturing and sales
|
|
China
|
|
|
100
|
%
|
MMT (Money Market Trust)
|
|
Money market trust
|
|
Korea
|
|
|
100
|
%
|
|
D.
|
Status of equity investments (as of March 31, 2018)
|
|
(1)
|
Consolidated subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
|
|
Investment Amount
(in millions)
|
|
|
Initial Equity
Investment Date
|
|
|
Equity
Interest
|
|
LG Display America, Inc.
|
|
US$
|
411
|
|
|
|
September 24, 1999
|
|
|
|
100
|
%
|
LG Display Japan Co., Ltd.
|
|
¥
|
95
|
|
|
|
October 12, 1999
|
|
|
|
100
|
%
|
LG Display Germany GmbH
|
|
EUR
|
1
|
|
|
|
November 5, 1999
|
|
|
|
100
|
%
|
LG Display Taiwan Co., Ltd.
|
|
NT$
|
116
|
|
|
|
May 19, 2000
|
|
|
|
100
|
%
|
LG Display Nanjing Co., Ltd.
|
|
CNY
|
3,020
|
|
|
|
July 15, 2002
|
|
|
|
100
|
%
|
LG Display Shanghai Co., Ltd.
|
|
CNY
|
4
|
|
|
|
January 16, 2003
|
|
|
|
100
|
%
|
LG Display Poland Sp. zo.o.
|
|
PLN
|
511
|
|
|
|
September 6, 2005
|
|
|
|
100
|
%
|
LG Display Guangzhou Co., Ltd.
|
|
CNY
|
1,655
|
|
|
|
August 7, 2006
|
|
|
|
100
|
%
|
LG Display Shenzhen Co., Ltd.
|
|
CNY
|
4
|
|
|
|
August 28, 2007
|
|
|
|
100
|
%
|
LG Display Singapore Pte. Ltd.
|
|
US$
|
1.1
|
|
|
|
January 12, 2009
|
|
|
|
100
|
%
|
L&T Display Technology (Fujian) Limited
|
|
CNY
|
116
|
|
|
|
January 5, 2010
|
|
|
|
51
|
%
|
LG Display Yantai Co., Ltd.
|
|
CNY
|
1,008
|
|
|
|
April 19, 2010
|
|
|
|
100
|
%
|
Nanumnuri Co., Ltd.
|
|
W
|
800
|
|
|
|
March 19, 2012
|
|
|
|
100
|
%
|
LG Display (China) Co., Ltd.
|
|
CNY
|
8,232
|
|
|
|
December 27, 2012
|
|
|
|
70
|
%
|
Unified Innovative Technology, LLC
|
|
US$
|
9
|
|
|
|
March 21, 2014
|
|
|
|
100
|
%
|
21
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
|
|
Investment Amount
(in millions)
|
|
|
Initial Equity
Investment Date
|
|
|
Equity
Interest
|
|
LG Display Guangzhou Trading Co., Ltd.
|
|
CNY
|
1.2
|
|
|
|
May 27, 2015
|
|
|
|
100
|
%
|
Global OLED Technology LLC
|
|
US$
|
138
|
|
|
|
May 7, 2015
|
|
|
|
100
|
%
|
LG Display Vietnam Haiphong Co., Ltd.
(1)
|
|
US$
|
300
|
|
|
|
May 13, 2016
|
|
|
|
100
|
%
|
Suzhou Lehui Display Co., Ltd.
|
|
CNY
|
637
|
|
|
|
July 1, 2016
|
|
|
|
100
|
%
|
MMT (Money Market Trust)
(2)
|
|
W
|
430,801
|
|
|
|
March 31, 2017
|
|
|
|
100
|
%
|
Changes since December 31, 2017:
(1)
|
During the reporting period, we invested an additional
W
212,600 million in LG Display Vietnam Haiphong Co., Ltd.
|
(2)
|
As a result of our money market trust acquisition and disposal transactions conducted during the reporting period, the amount outstanding in our money market trust accounts as of March 31, 2018 is
W
430,801 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company
|
|
Carrying Amount
(in millions)
|
|
|
Date of
Incorporation
|
|
|
Equity
Interest
|
|
Paju Electric Glass Co., Ltd.
|
|
W
|
44,179
|
|
|
|
January 2005
|
|
|
|
40
|
%
|
Invenia Co., Ltd.
|
|
W
|
3,125
|
|
|
|
January 2001
|
|
|
|
13
|
%
|
Wooree E&L Co., Ltd.
|
|
W
|
3,506
|
|
|
|
June 2008
|
|
|
|
14
|
%
|
LB Gemini New Growth Fund
No. 16
(1)
|
|
W
|
5,282
|
|
|
|
December 2009
|
|
|
|
31
|
%
|
YAS Co., Ltd.
|
|
W
|
16,045
|
|
|
|
April 2002
|
|
|
|
15
|
%
|
Avatec Co., Ltd.
|
|
W
|
23,252
|
|
|
|
August 2000
|
|
|
|
17
|
%
|
Arctic Sentinel, Inc.
|
|
|
|
|
|
|
June 2008
|
|
|
|
10
|
%
|
CYNORA GmbH
|
|
W
|
20,309
|
|
|
|
March 2003
|
|
|
|
14
|
%
|
Material Science Co., Ltd.
(2)
|
|
W
|
4,000
|
|
|
|
January 2014
|
|
|
|
10
|
%
|
Changes since December 31, 2017:
(1)
|
We participate as a limited member in LB Gemini New Growth Fund No. 16. Upon a general meeting, the members have decided to dissolve the fund, which is currently under liquidation.
|
(2)
|
In March 2018, we acquired 10,767 voting common shares of Material Science Co., Ltd. for
W
4,000 million. As of March 31, 2018, our percentage ownership interest in Material
Science Co., Ltd. is 10%, and we are entitled to appoint one director of Material Science Co., Ltd.
|
|
|
|
|
|
|
|
|
|
(Unit: In millions of Won, hours)
|
Description
|
|
2018 Q1
|
|
2017
|
|
2016
|
Auditor
|
|
KPMG Samjong
|
|
KPMG Samjong
|
|
KPMG Samjong
|
Activity
|
|
Audit by independent
auditor
|
|
Audit by independent
auditor
|
|
Audit by independent
auditor
|
Compensation
(1)
|
|
1,170 (450)
(2)
|
|
1,040 (450)
(2)
|
|
1,020 (440)
(2)
|
Time required
|
|
1,710
|
|
17,909
|
|
18,291
|
(1)
|
Compensation amount is the contracted amount for the full fiscal year.
|
(2)
|
Compensation amount in ( ) is for Form
20-F
filing and SOX 404 audit.
|
None.
22
|
A.
|
Members of the board of directors
|
As of March 31, 2018, our
board of directors consisted of two
non-outside
directors, one
non-standing
director and four outside directors.
|
|
|
|
|
|
|
|
|
(As of March 31, 2018)
|
Name
|
|
Position
|
|
Primary responsibility
|
Sang Beom Han
(1)
|
|
Representative Director
(non-outside),
Chief Executive Officer and Vice Chairman
|
|
Chairman of the board of directors
|
|
|
|
Sang Don Kim
|
|
Director
(non-outside),
Chief Financial Officer and Senior Vice President
|
|
Overall head of finances
|
|
|
|
Hyun-Hwoi Ha
(2)
|
|
Director
(non-standing)
|
|
Related to the overall management
|
|
|
|
Joon Park
(3)
|
|
Outside Director
|
|
Related to the overall management
|
|
|
|
Sung-Sik
Hwang
(4)
|
|
Outside Director
|
|
Related to the overall management
|
|
|
|
Kun Tai Han
(5)
|
|
Outside Director
|
|
Related to the overall management
|
|
|
|
Byoung Ho Lee
(6)
|
|
Outside Director
|
|
Related to the overall management
|
(1)
|
Sang Beom Han was reappointed for another term as a
non-outside
director at the annual general meeting of shareholders held on March 15, 2018.
|
(2)
|
Hyun Hwoi Ha is also a standing director of LG Corp., a
non-standing
director of LG Hausys, Ltd., a
non-standing
director of LG
International Corp., a
non-standing
director of LG Uplus Corp., a
non-standing
director of LG Economic Research Institute and a
non-standing
director of LG CNS Co., Ltd.
|
(3)
|
Joon Park is also an outside director of Green Cross Holdings Corp .
|
(4)
|
Sung-Sik
Hwang was reappointed for another term as an outside director at the annual general meeting of shareholders held on March 15, 2018. Mr. Hwang is also an outside
director of Kyobo Life Insurance Co., Ltd.
|
(5)
|
Kun Tai Han is also the chief executive officer of Hans Consulting.
|
(6)
|
Byoung Ho Lee was appointed as an outside director at the annual general meeting of shareholders held on March 15, 2018.
|
|
B.
|
Committees of the board of directors
|
We have the following
committees that serve under our board of directors: Audit Committee, Outside Director Nomination Committee and Management Committee. The Management Committee consists of two
non-outside
directors, Sang Beom
Han and Sang Don Kim.
During the reporting period, one meeting of the Outside Director Nomination Committee was held and the composition
of the Outside Director Nomination Committee was as follows:
|
|
|
|
|
|
|
(As of January 22, 2018)
|
Committee
|
|
Composition
|
|
Member
|
Outside Director Nomination Committee
(1)
|
|
1
non-standing
director and 2 outside directors
|
|
Hyun-Hwoi Ha,
Joon Park,
Sung-Sik
Hwang
|
(1)
|
Each of Hyun-Hwoi Ha, Joon Park and
Sung-Sik
Hwang was appointed as a member of the outside director nomination committee of the board of directors by the board of directors on
January 22, 2018.
|
As of the March 31, 2018, the composition of the Audit Committee is as follows.
|
|
|
|
|
|
|
(As of March 31, 2018)
|
Committee
|
|
Composition
|
|
Member
|
Audit Committee
|
|
3 outside directors
|
|
Sung-Sik
Hwang
(1)
, Joon Park, Kun Tai Han
|
23
(1)
|
Sung-Sik
Hwang is the audit committee chairman. He was reappointed for another term as an Audit Committee member at the annual general meeting of shareholders held on
March 15, 2018.
|
|
C.
|
Independence of directors
|
Directors are appointed in accordance
with the procedures of the Commercial Act and other relevant laws and regulations. Our board of directors is independent as four out of the seven directors that comprise the board are outside directors. Outside directors candidates are nominated for
appointment at a shareholders meeting after undergoing rigorous review by the Outside Director Nomination Committee.
All of our
current outside directors were nominated by the Outside Director Nomination Committee, and all of our current
non-outside
directors were nominated by the board of directors.
15.
|
Information Regarding Shares
|
|
A.
|
Total number of shares
|
|
(1)
|
Total number of shares authorized to be issued (as of March 31, 2018): 500,000,000 shares.
|
|
(2)
|
Total shares issued and outstanding (as of March 31, 2018): 357,815,700 shares.
|
|
(1)
|
Largest shareholder and related parties as of March 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
Name
|
|
Relationship
|
|
Number of shares
of common stock
|
|
|
Equity interest
|
|
LG Electronics
|
|
Largest Shareholder
|
|
|
135,625,000
|
|
|
|
37.9
|
%
|
Sang Beom Han
|
|
Related Party
|
|
|
31,355
|
|
|
|
0.0
|
%
|
Sang Don Kim
|
|
Related Party
|
|
|
4,000
|
|
|
|
0.0
|
%
|
|
(2)
|
Shareholders who are known to us to own 5% or more of our shares as of March 31, 2018:
|
|
|
|
|
|
|
|
|
|
Beneficial owner
|
|
Number of shares
of common stock
|
|
|
Equity
interest
|
|
LG Electronics
|
|
|
135,625,000
|
|
|
|
37.9
|
%
|
National Pension Service
|
|
|
31,075,124
|
|
|
|
8.68
|
%
|
16.
|
Directors and Employees
|
|
(1)
|
Remuneration for directors in 2018 Q1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: person, in millions of Won)
|
|
Classification
|
|
No. of
directors
(1)
|
|
|
Amount
paid
(2)
|
|
|
Per capita average
remuneration
paid
(3)
|
|
Non-outside
directors
|
|
|
3
|
|
|
|
2,017
|
|
|
|
672
|
|
Outside directors who are not audit committee members
|
|
|
1
|
|
|
|
26
|
|
|
|
26
|
|
Outside directors who are audit committee members
|
|
|
3
|
|
|
|
59
|
|
|
|
20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
7
|
|
|
|
2,102
|
(4)
|
|
|
300
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24
(1)
|
Number of directors as at March 31, 2018.
|
(2)
|
Amount paid is calculated on the basis of amount of cash actually paid.
|
(3)
|
Per capita average remuneration paid is calculated by dividing total amount paid by the average number of directors for the three months ended March 31, 2018.
|
(4)
|
As Jin Jang resigned as an outside director on March 14, 2018 and Byoung Ho Lee was appointed as an outside director at the annual general meeting of shareholders held on March 15, 2018, the total amount paid
includes remuneration paid to both Mr. Jang and Mr. Lee.
|
|
(2)
|
Remuneration for individual directors and audit committee members
|
Not required for quarterly
reports.
Not applicable.
As of March 31, 2018, we had 33,525 employees
(excluding our directors). On average, our male employees have served 9.2 years and our female employees have served 7.8 years. The total amount of salary paid to our employees for the three months ended March 31, 2018 based on income tax
statements submitted to the Korean tax authority in accordance with Article 20 of the Income Tax Act was
W
820,970 million for our male employees and
W
182,105 million for
our female employees. The following table provides details of our employees as of March 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unit: person, in millions of Won, year)
|
|
|
|
Number of
employees
(1)
|
|
|
Total salary in
2018 Q1
(2)(3)(4)
|
|
|
Total salary
per capita
(5)
|
|
|
Average years
of service
|
|
Male
|
|
|
25,373
|
|
|
|
820,970
|
|
|
|
32.6
|
|
|
|
9.2
|
|
Female
|
|
|
8,152
|
|
|
|
182,105
|
|
|
|
22.2
|
|
|
|
7.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
33,525
|
|
|
|
1,003,076
|
|
|
|
30.1
|
|
|
|
8.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Includes
part-time
employees hired for temporary needs or to serve as temporary replacements for employees on parental leave.
|
(2)
|
Welfare benefits and retirement expenses have been excluded. Total welfare benefit provided to our employees for the three months ended March 31, 2018 was
W
106,892 million and
the per capita welfare benefit provided was
W
3.2 million.
|
(3)
|
Based on income tax statements, which are submitted to the Korean tax authority in accordance with Article 20 of the Income Tax Act.
|
(4)
|
Includes incentive payments to employees who have transferred from our affiliated companies.
|
(5)
|
Calculated using the average number of employees (male: 25,146 , female: 8,189) for the three months ended March 31, 2018.
|
In December 2017, we were audited by the Ministry of Employment and Labor regarding our human resource practices (including in relation to
employment contracts, hours of work, outsourcing and employees in pregnancy), and we were found to be in violation of certain provisions of the Labor Standard Act relating to overtime, night and holiday work. As a result, we were issued a corrective
order in January 2018 and paid additional overtime wages of
W
2,893 million to 16,106 administrative employees of our Paju facilities for their nighttime work between January 1, 2015 to December 31,
2017. In addition, we reviewed nighttime work records of our administrative employees outside of our Paju facilities during the same period and paid additional overtime wages of
W
2,166 million to eligible
employees. In order to prevent such violation from occurring again, we are periodically monitoring the nighttime work records of our employees.
From December 2017 to January 2018, we were audited by the Ministry of Employment and Labor regarding our human resource practices relating to
temporary and part-time employees, and we were found to have omitted certain required information (including the number of break hours and vacation days) in the employment contracts of 82 temporary employees. As a result, we were assessed a fine of
W
27 million, which we subsequently paid. In order to prevent such violation from occurring again, we have amended the relevant provisions of the applicable employment contracts.
25
|
A.
|
Material Events Subsequent to the Reporting Period
|
|
(1)
|
Advance Received Pursuant to Long-term Supply Agreement
|
In April 2018, we received an advance
of US$300 million (equivalent to
W
320,670 million) from a major customer pursuant to the terms of a long-term supply agreement. Such advance will be offset in time by payments for applicable products after a
certain initial period of deferral.
|
(2)
|
Credits Extended to Affiliated Parties
|
Subsequent to the reporting period, we provided
guarantees relating to certain payment obligations of our subsidiary, LG Display Vietnam Haiphong Co., Ltd., in connection with its bank borrowings as further described below:
|
|
|
|
|
|
|
|
|
|
|
Lender
|
|
Date of
Agreement
|
|
Term of
Borrowing/Guarantee
|
|
Interest Rate
|
|
Principal
Amount
|
|
Guaranteed
Amount
|
Citibank Taiwan Limited
|
|
March 12, 2018
|
|
April 13, 2018 ~
April 13, 2023
|
|
3 month LIBOR
+ 1.20%
|
|
US$ 100
million
|
|
US$ 100
million
|
Sumitomo Mitsui Banking Corporation
|
|
April 5, 2018
|
|
April 26, 2018 ~
April 26, 2025
|
|
3 month LIBOR
+ 1.20%
|
|
US$ 100
million
|
|
US$ 100
million
|
26
LG DISPLAY CO., LTD. AND SUBSIDIARIES
Condensed Consolidated Interim Financial Statements
(Unaudited)
March 31, 2018 and 2017
(With Independent Auditors Review Report Thereon)
27
Table of Contents
28
Independent Auditors Review Report
Based on a report originally issued in Korean
To the Board of Directors and Shareholders
LG Display Co.,
Ltd.:
Reviewed Financial Statements
We have
reviewed the accompanying condensed consolidated interim financial statements of LG Display Co., Ltd. and subsidiaries (the Group) which comprise the condensed consolidated interim statement of financial position as of March 31,
2018, the condensed consolidated interim statements of comprehensive income, changes in equity and cash flows for the three-month periods ended March 31, 2018 and 2017, and notes comprising a summary of significant accounting policies and other
explanatory information.
Managements Responsibility for the Condensed Consolidated Interim Financial Statements
Management is responsible for the preparation and fair presentation of these condensed consolidated interim financial statements in accordance with Korean
International Financial Reporting Standards No. 1034,
Interim Financial Reporting,
and for such internal controls as management determines necessary to enable the preparation of condensed consolidated interim financial statements that
are free from material misstatement, whether due to fraud or error.
Auditors Responsibility
Our responsibility is to issue a report on these condensed consolidated interim financial statements based on our reviews.
We conducted our reviews in accordance with the Review Standards for Quarterly and Semiannual Financial Statements established by the Security and Futures
Commission of the Republic of Korea. A review of interim financial information consists principally of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A
review is substantially less in scope than an audit conducted in accordance with Korean Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our reviews, nothing has come to our attention that causes us to believe that the condensed consolidated interim financial statements referred to
above are not presented fairly, in all material respects, in accordance with Korean International Financial Reporting Standards No. 1034,
Interim Financial Reporting.
Other Matters
The procedures and practices
utilized in the Republic of Korea to review such condensed consolidated interim financial statements may differ from those generally accepted and applied in other countries.
We audited the consolidated statement of financial position as of December 31, 2017 and the related consolidated statements of comprehensive income,
changes in equity and cash flows for the year then ended, which are not accompanying this review report, in accordance with Korean Standards on Auditing, and our report thereon, dated February 22, 2018, expressed an unqualified opinion. The
accompanying condensed consolidated statement of financial position of the Group as of December 31, 2017, presented for comparative purposes, is not different from that audited by us from which it was derived in all material respects.
29
/s/ KPMG Samjong Accounting Corp.
Seoul, Korea
May 14, 2018
This report is effective as of May 14, 2018 the review report date. Certain subsequent events or circumstances
,
which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying condensed consolidated interim financial statements and notes thereto. Accordingly, the readers of the review report
should understand that the above review report has not been updated to reflect the impact of such subsequent events or circumstances, if any.
30
LG DISPLAY CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Financial Position
(Unaudited)
As of March 31, 2018 and December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Note
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
4, 25
|
|
W
|
2,626,689
|
|
|
|
2,602,560
|
|
Deposits in banks
|
|
4, 25
|
|
|
870,272
|
|
|
|
758,078
|
|
Trade accounts and notes receivable, net
|
|
5, 14, 25, 27
|
|
|
3,496,163
|
|
|
|
4,325,120
|
|
Other accounts receivable, net
|
|
5, 25
|
|
|
126,369
|
|
|
|
164,827
|
|
Other current financial assets
|
|
6, 25
|
|
|
17,392
|
|
|
|
27,252
|
|
Inventories
|
|
7
|
|
|
2,350,385
|
|
|
|
2,350,084
|
|
Prepaid income taxes
|
|
|
|
|
6,281
|
|
|
|
3,854
|
|
Other current assets
|
|
5
|
|
|
405,035
|
|
|
|
241,928
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
|
|
9,898,586
|
|
|
|
10,473,703
|
|
Deposits in banks
|
|
4, 25
|
|
|
11
|
|
|
|
11
|
|
Investments in equity accounted investees
|
|
8
|
|
|
119,698
|
|
|
|
122,507
|
|
Other
non-current
financial assets
|
|
6, 25
|
|
|
64,919
|
|
|
|
68,574
|
|
Property, plant and equipment, net
|
|
9, 17
|
|
|
17,525,116
|
|
|
|
16,201,960
|
|
Intangible assets, net
|
|
10, 17
|
|
|
912,202
|
|
|
|
912,821
|
|
Deferred tax assets
|
|
23
|
|
|
1,082,835
|
|
|
|
985,352
|
|
Other
non-current
assets
|
|
5
|
|
|
391,904
|
|
|
|
394,759
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-current
assets
|
|
|
|
|
20,096,685
|
|
|
|
18,685,984
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
W
|
29,995,271
|
|
|
|
29,159,687
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
Trade accounts and notes payable
|
|
25, 27
|
|
W
|
2,802,837
|
|
|
|
2,875,090
|
|
Current financial liabilities
|
|
11, 25
|
|
|
2,148,016
|
|
|
|
1,452,926
|
|
Other accounts payable
|
|
25
|
|
|
3,273,185
|
|
|
|
3,169,937
|
|
Accrued expenses
|
|
|
|
|
551,725
|
|
|
|
812,615
|
|
Income tax payable
|
|
|
|
|
145,549
|
|
|
|
321,978
|
|
Provisions
|
|
13
|
|
|
74,220
|
|
|
|
76,016
|
|
Advances received
|
|
14, 28
|
|
|
249,765
|
|
|
|
194,129
|
|
Other current liabilities
|
|
13
|
|
|
303,294
|
|
|
|
75,991
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
|
|
9,548,591
|
|
|
|
8,978,682
|
|
Non-current
financial liabilities
|
|
11, 25
|
|
|
4,583,674
|
|
|
|
4,150,192
|
|
Non-current
provisions
|
|
13
|
|
|
22,635
|
|
|
|
28,312
|
|
Defined benefit liabilities, net
|
|
12
|
|
|
150,979
|
|
|
|
95,447
|
|
Long-term advances received
|
|
14, 28
|
|
|
759,881
|
|
|
|
830,335
|
|
Deferred tax liabilities
|
|
23
|
|
|
23,657
|
|
|
|
24,646
|
|
Other
non-current
liabilities
|
|
13
|
|
|
80,218
|
|
|
|
70,563
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-current
liabilities
|
|
|
|
|
5,621,044
|
|
|
|
5,199,495
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
|
|
15,169,635
|
|
|
|
14,178,177
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
15
|
|
|
1,789,079
|
|
|
|
1,789,079
|
|
Share premium
|
|
|
|
|
2,251,113
|
|
|
|
2,251,113
|
|
Retained earnings
|
|
|
|
|
10,379,127
|
|
|
|
10,621,571
|
|
Reserves
|
|
15
|
|
|
(182,040
|
)
|
|
|
(288,280
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Total equity attributable to owners of the Controlling Company
|
|
|
|
|
14,237,279
|
|
|
|
14,373,483
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
|
|
|
|
588,357
|
|
|
|
608,027
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity
|
|
|
|
|
14,825,636
|
|
|
|
14,981,510
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity
|
|
|
|
W
|
29,995,271
|
|
|
|
29,159,687
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the consolidated interim financial statements.
31
LG DISPLAY CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income
(Unaudited)
For the three-month periods ended March 31,
2018 and 2017
|
|
|
|
|
|
|
|
|
|
|
(In millions of won, except earnings per share)
|
|
Note
|
|
2018
|
|
|
2017
|
|
Revenue
|
|
16, 17, 27
|
|
W
|
5,675,164
|
|
|
|
7,062,162
|
|
Cost of sales
|
|
7, 18, 27
|
|
|
(5,133,080
|
)
|
|
|
(5,342,882
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
|
|
542,084
|
|
|
|
1,719,280
|
|
Selling expenses
|
|
19
|
|
|
(172,958
|
)
|
|
|
(243,203
|
)
|
Administrative expenses
|
|
19
|
|
|
(182,330
|
)
|
|
|
(164,950
|
)
|
Research and development expenses
|
|
|
|
|
(285,119
|
)
|
|
|
(284,250
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit (loss)
|
|
|
|
|
(98,323
|
)
|
|
|
1,026,877
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance income
|
|
22
|
|
|
120,997
|
|
|
|
115,134
|
|
Finance costs
|
|
22
|
|
|
(130,361
|
)
|
|
|
(88,037
|
)
|
Other
non-operating
income
|
|
21
|
|
|
227,642
|
|
|
|
384,389
|
|
Other
non-operating
expenses
|
|
21
|
|
|
(212,837
|
)
|
|
|
(580,493
|
)
|
Equity in income (loss) of equity accounted investees, net
|
|
|
|
|
(2,893
|
)
|
|
|
250
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) before income tax
|
|
|
|
|
(95,775
|
)
|
|
|
858,120
|
|
Income tax expense(benefit)
|
|
23
|
|
|
(46,793
|
)
|
|
|
178,623
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
|
|
(48,982
|
)
|
|
|
679,497
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
Items that will never be reclassified to profit or loss
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of net defined benefit liabilities
|
|
12
|
|
|
(6,419
|
)
|
|
|
(4,725
|
)
|
Other comprehensive income (loss) from associates
|
|
|
|
|
41
|
|
|
|
(243
|
)
|
Related income tax
|
|
12
|
|
|
2,296
|
|
|
|
1,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,082
|
)
|
|
|
(3,825
|
)
|
Items that are or may be reclassified to profit or loss
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation differences for foreign operations
|
|
|
|
|
127,890
|
|
|
|
(249,677
|
)
|
Other comprehensive income (loss) from associates
|
|
|
|
|
1,315
|
|
|
|
(552
|
)
|
Related income tax
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
129,205
|
|
|
|
(250,229
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss) for the period, net of income tax
|
|
|
|
|
125,123
|
|
|
|
(254,054
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period
|
|
|
|
W
|
76,141
|
|
|
|
425,443
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) attributable to:
|
|
|
|
|
|
|
|
|
|
|
Owners of the Controlling Company
|
|
|
|
|
(59,454
|
)
|
|
|
633,490
|
|
Non-controlling
interests
|
|
|
|
|
10,472
|
|
|
|
46,007
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
|
W
|
(48,982
|
)
|
|
|
679,497
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income attributable to:
|
|
|
|
|
|
|
|
|
|
|
Owners of the Controlling Company
|
|
|
|
|
42,704
|
|
|
|
412,932
|
|
Non-controlling
interests
|
|
|
|
|
33,437
|
|
|
|
12,511
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period
|
|
|
|
W
|
76,141
|
|
|
|
425,443
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share (In won)
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per share
|
|
24
|
|
W
|
(166
|
)
|
|
|
1,770
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings (loss) per share
|
|
24
|
|
W
|
(166
|
)
|
|
|
1,770
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the consolidated interim financial statements.
32
LG DISPLAY CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Changes in Equity
(Unaudited)
For the three-month periods ended
March 31, 2018 and 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to owners of the Controlling Company
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Share
capital
|
|
|
Share
premium
|
|
|
Retained
earnings
|
|
|
Reserves
|
|
|
Sub-total
|
|
|
Non-controlling
interests
|
|
|
Total equity
|
|
Balances at January 1, 2017
|
|
W
|
1,789,079
|
|
|
|
2,251,113
|
|
|
|
9,004,283
|
|
|
|
(88,478
|
)
|
|
|
12,955,997
|
|
|
|
506,391
|
|
|
|
13,462,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the period
|
|
|
|
|
|
|
|
|
|
|
633,490
|
|
|
|
|
|
|
|
633,490
|
|
|
|
46,007
|
|
|
|
679,497
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of net defined benefit liabilities, net of tax
|
|
|
|
|
|
|
|
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
(3,582
|
)
|
Foreign currency translation differences for foreign operations, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(216,181
|
)
|
|
|
(216,181
|
)
|
|
|
(33,496
|
)
|
|
|
(249,677
|
)
|
Other comprehensive loss from asssociates
|
|
|
|
|
|
|
|
|
|
|
(243
|
)
|
|
|
(552
|
)
|
|
|
(795
|
)
|
|
|
|
|
|
|
(795
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
(3,825
|
)
|
|
|
(216,733
|
)
|
|
|
(220,558
|
)
|
|
|
(33,496
|
)
|
|
|
(254,054
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
W
|
|
|
|
|
|
|
|
|
629,665
|
|
|
|
(216,733
|
)
|
|
|
412,932
|
|
|
|
12,511
|
|
|
|
425,443
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction with owners, recognized directly in equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends to equity holders
|
|
|
|
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances at March 31, 2017
|
|
W
|
1,789,079
|
|
|
|
2,251,113
|
|
|
|
9,455,040
|
|
|
|
(305,211
|
)
|
|
|
13,190,021
|
|
|
|
518,902
|
|
|
|
13,708,923
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances at January 1, 2018
|
|
W
|
1,789,079
|
|
|
|
2,251,113
|
|
|
|
10,621,571
|
|
|
|
(288,280
|
)
|
|
|
14,373,483
|
|
|
|
608,027
|
|
|
|
14,981,510
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
|
|
|
|
|
|
|
|
(59,454
|
)
|
|
|
|
|
|
|
(59,454
|
)
|
|
|
10,472
|
|
|
|
(48,982
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of net defined benefit liabilities, net of tax
|
|
|
|
|
|
|
|
|
|
|
(4,123
|
)
|
|
|
|
|
|
|
(4,123
|
)
|
|
|
|
|
|
|
(4,123
|
)
|
Foreign currency translation differences for foreign operations, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
104,925
|
|
|
|
104,925
|
|
|
|
22,965
|
|
|
|
127,890
|
|
Other comprehensive income from associates
|
|
|
|
|
|
|
|
|
|
|
41
|
|
|
|
1,315
|
|
|
|
1,356
|
|
|
|
|
|
|
|
1,356
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
(4,082
|
)
|
|
|
106,240
|
|
|
|
102,158
|
|
|
|
22,965
|
|
|
|
125,123
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
W
|
|
|
|
|
|
|
|
|
(63,536
|
)
|
|
|
106,240
|
|
|
|
42,704
|
|
|
|
33,437
|
|
|
|
76,141
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction with owners, recognized directly in equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends to equity holders
|
|
|
|
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
(178,908
|
)
|
Subsidiaries dividends distributed to
non-controlling
interests
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(53,107
|
)
|
|
|
(53,107
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances at March 31, 2018
|
|
W
|
1,789,079
|
|
|
|
2,251,113
|
|
|
|
10,379,127
|
|
|
|
(182,040
|
)
|
|
|
14,237,279
|
|
|
|
588,357
|
|
|
|
14,825,636
|
|
See accompanying notes to the consolidated interim financial statements.
33
LG DISPLAY CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)
For the three-month periods ended March 31,
2018 and 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Note
|
|
|
2018
|
|
|
2017
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
|
|
|
W
|
(48,982
|
)
|
|
|
679,497
|
|
Adjustments for:
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense (benefit)
|
|
|
23
|
|
|
|
(46,793
|
)
|
|
|
178,623
|
|
Depreciation
|
|
|
18
|
|
|
|
807,736
|
|
|
|
610,553
|
|
Amortization of intangible assets
|
|
|
18
|
|
|
|
102,339
|
|
|
|
105,311
|
|
Gain on foreign currency translation
|
|
|
|
|
|
|
(62,852
|
)
|
|
|
(79,725
|
)
|
Loss on foreign currency translation
|
|
|
|
|
|
|
53,141
|
|
|
|
161,901
|
|
Expenses related to defined benefit plans
|
|
|
12
|
|
|
|
51,801
|
|
|
|
49,349
|
|
Gain on disposal of property, plant and equipment
|
|
|
|
|
|
|
(4,006
|
)
|
|
|
(11,560
|
)
|
Loss on disposal of property, plant and equipment
|
|
|
|
|
|
|
8,405
|
|
|
|
2,231
|
|
Gain on disposal of intangible assets
|
|
|
|
|
|
|
(239
|
)
|
|
|
|
|
Impairment loss on intangible assets
|
|
|
|
|
|
|
37
|
|
|
|
1,689
|
|
Reversal of impairment loss on intangible assets
|
|
|
|
|
|
|
(130
|
)
|
|
|
|
|
Warranty expense
|
|
|
|
|
|
|
35,647
|
|
|
|
75,850
|
|
Finance income
|
|
|
|
|
|
|
(35,238
|
)
|
|
|
(97,974
|
)
|
Finance costs
|
|
|
|
|
|
|
23,395
|
|
|
|
49,057
|
|
Equity in loss (income) of equity method accounted investees, net
|
|
|
8
|
|
|
|
2,893
|
|
|
|
(250
|
)
|
Other income
|
|
|
|
|
|
|
(489
|
)
|
|
|
(261
|
)
|
Other expenses
|
|
|
|
|
|
|
634
|
|
|
|
98
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
936,281
|
|
|
|
1,044,892
|
|
Changes in
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts and notes receivable
|
|
|
|
|
|
|
783,501
|
|
|
|
383,054
|
|
Other accounts receivable
|
|
|
|
|
|
|
18,759
|
|
|
|
6,370
|
|
Inventories
|
|
|
|
|
|
|
(114,588
|
)
|
|
|
4,350
|
|
Other current assets
|
|
|
|
|
|
|
(131,364
|
)
|
|
|
(123,822
|
)
|
Other
non-current
assets
|
|
|
|
|
|
|
(15,822
|
)
|
|
|
(20,980
|
)
|
Trade accounts and notes payable
|
|
|
|
|
|
|
(46,042
|
)
|
|
|
(380,460
|
)
|
Other accounts payable
|
|
|
|
|
|
|
(174,431
|
)
|
|
|
(44,954
|
)
|
Accrued expenses
|
|
|
|
|
|
|
(262,999
|
)
|
|
|
(184,853
|
)
|
Provisions
|
|
|
|
|
|
|
(52,910
|
)
|
|
|
(52,670
|
)
|
Other current liabilities
|
|
|
|
|
|
|
(15,138
|
)
|
|
|
(37
|
)
|
Defined benefit liabilities, net
|
|
|
|
|
|
|
(2,734
|
)
|
|
|
(1,740
|
)
|
Other
non-current
liabilities
|
|
|
|
|
|
|
7,622
|
|
|
|
1,207
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6,146
|
)
|
|
|
(414,535
|
)
|
Cash generated from operating activities
|
|
|
|
|
|
|
881,153
|
|
|
|
1,309,854
|
|
Income taxes paid
|
|
|
|
|
|
|
(55,851
|
)
|
|
|
(46,986
|
)
|
Interests received
|
|
|
|
|
|
|
17,487
|
|
|
|
10,377
|
|
Interests paid
|
|
|
|
|
|
|
(40,574
|
)
|
|
|
(31,204
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
|
|
|
W
|
802,215
|
|
|
|
1,242,041
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the consolidated interim financial statements.
34
LG DISPLAY CO., LTD. AND SUBSIDIARIES
Consolidated Statements of Cash Flows, Continued
(Unaudited)
For the three-month periods ended March 31,
2018 and 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Note
|
|
|
2018
|
|
|
2017
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends received
|
|
|
|
|
|
W
|
4,712
|
|
|
|
8,109
|
|
Proceeds from withdrawal of deposits in banks
|
|
|
|
|
|
|
518,363
|
|
|
|
487,131
|
|
Increase in deposits in banks
|
|
|
|
|
|
|
(630,913
|
)
|
|
|
(281,635
|
)
|
Acquisition of
available-for-sale
financial assets
|
|
|
|
|
|
|
(39
|
)
|
|
|
|
|
Acquisition of investments in equity accounted investees
|
|
|
|
|
|
|
(4,000
|
)
|
|
|
|
|
Proceeds from disposal of investments in equity accounted investees
|
|
|
|
|
|
|
|
|
|
|
5,157
|
|
Acquisition of property, plant and equipment
|
|
|
|
|
|
|
(1,815,515
|
)
|
|
|
(1,609,628
|
)
|
Proceeds from disposal of property, plant and equipment
|
|
|
|
|
|
|
102,496
|
|
|
|
70,003
|
|
Acquisition of intangible assets
|
|
|
|
|
|
|
(130,638
|
)
|
|
|
(113,878
|
)
|
Proceeds from disposal of intangible assets
|
|
|
|
|
|
|
960
|
|
|
|
|
|
Receipt from settlement of derivatives
|
|
|
|
|
|
|
(2
|
)
|
|
|
(101
|
)
|
Proceeds from collection of short-term loans
|
|
|
|
|
|
|
7,351
|
|
|
|
|
|
Increase in long-term loans
|
|
|
|
|
|
|
(12,300
|
)
|
|
|
|
|
Decrease in deposits
|
|
|
|
|
|
|
294
|
|
|
|
2,991
|
|
Increase in deposits
|
|
|
|
|
|
|
(517
|
)
|
|
|
(933
|
)
|
Proceeds from disposal of emission rights
|
|
|
|
|
|
|
4,160
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
|
|
|
|
(1,955,588
|
)
|
|
|
(1,432,784
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
26
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of bonds
|
|
|
|
|
|
|
388,447
|
|
|
|
|
|
Proceeds from long-term borrowings
|
|
|
|
|
|
|
907,850
|
|
|
|
119,741
|
|
Repayments of current portion of long-term borrowings and bonds
|
|
|
|
|
|
|
(180,168
|
)
|
|
|
(63,216
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by financing activities
|
|
|
|
|
|
|
1,116,129
|
|
|
|
56,525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents
|
|
|
|
|
|
|
(37,244
|
)
|
|
|
(134,218
|
)
|
Cash and cash equivalents at January 1
|
|
|
|
|
|
|
2,602,560
|
|
|
|
1,558,696
|
|
Effect of exchange rate fluctuations on cash held
|
|
|
|
|
|
|
61,373
|
|
|
|
(79,755
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at March 31
|
|
|
|
|
|
W
|
2,626,689
|
|
|
|
1,344,723
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the consolidated interim financial statements.
35
|
(a)
|
Description of the Controlling Company
|
LG Display Co., Ltd. (the Controlling
Company) was incorporated in February 1985 and the Controlling Company is a public corporation listed in Korea Exchange since 2004. The main business of the Controlling Company and its subsidiaries (the Group) is to manufacture and
sell displays and its related products. As of March 31, 2018, the Group is operating Thin Film Transistor Liquid Crystal Display
(TFT-LCD)
and Organic Light Emitting Diode (OLED) panel
manufacturing plants in Gumi, Paju and China and
TFT-LCD
and OLED module manufacturing plants in Gumi, Paju, China, Poland and Vietnam. The Controlling Company is domiciled in the Republic of Korea with its
address at 128
Yeouidae-ro,
Yeongdeungpo-gu, Seoul, the Republic of Korea. As of March 31, 2018, LG Electronics Inc., a major shareholder of the Controlling Company, owns 37.9% (135,625,000 shares) of the
Controlling Companys common stock.
The Controlling Companys common stock is listed on the Korea Exchange under the identifying
code 034220. As of March 31, 2018, there are 357,815,700 shares of common stock outstanding. The Controlling Companys common stock is also listed on the New York Stock Exchange in the form of American Depository Shares (ADSs)
under the symbol LPL. One ADS represents
one-half
of one share of common stock. As of March 31, 2018, there are 23,730,762 ADSs outstanding.
36
1.
|
Reporting Entity, Continued
|
|
(b)
|
Consolidated Subsidiaries as of March
31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsidiaries
|
|
Location
|
|
Percentage of
ownership
|
|
|
Fiscal year
end
|
|
|
Date of
incorporation
|
|
Business
|
|
|
Capital stocks
|
|
LG Display America, Inc.
|
|
San Jose,
U.S.A.
|
|
|
100%
|
|
|
|
December 31
|
|
|
September 24, 1999
|
|
|
Sell Display products
|
|
|
USD
|
411
|
|
LG Display Japan Co., Ltd.
|
|
Tokyo, Japan
|
|
|
100%
|
|
|
|
December 31
|
|
|
October 12, 1999
|
|
|
Sell Display products
|
|
|
JPY
|
95
|
|
LG Display Germany GmbH
|
|
Eschborn, Germany
|
|
|
100
|
%
|
|
|
December 31
|
|
|
November 5, 1999
|
|
|
Sell Display products
|
|
|
EUR
|
1
|
|
LG Display Taiwan Co., Ltd.
|
|
Taipei, Taiwan
|
|
|
100%
|
|
|
|
December 31
|
|
|
April 12, 1999
|
|
|
Sell Display products
|
|
|
NTD
|
116
|
|
LG Display Nanjing Co., Ltd.
|
|
Nanjing, China
|
|
|
100%
|
|
|
|
December 31
|
|
|
July 15, 2002
|
|
|
Manufacture Display
products
|
|
|
CNY
|
3,020
|
|
LG Display Shanghai Co., Ltd.
|
|
Shanghai, China
|
|
|
100%
|
|
|
|
December 31
|
|
|
January 16, 2003
|
|
|
Sell Display products
|
|
|
CNY
|
4
|
|
LG Display Poland Sp. z o.o.
|
|
Wroclaw, Poland
|
|
|
100%
|
|
|
|
December 31
|
|
|
September 6, 2005
|
|
|
Manufacture Display
products
|
|
|
PLN
|
511
|
|
LG Display Guangzhou Co., Ltd.
|
|
Guangzhou, China
|
|
|
100%
|
|
|
|
December 31
|
|
|
June 30, 2006
|
|
|
Manufacture Display
products
|
|
|
CNY
|
1,655
|
|
LG Display Shenzhen Co., Ltd.
|
|
Shenzhen, China
|
|
|
100%
|
|
|
|
December 31
|
|
|
August 28, 2007
|
|
|
Sell Display products
|
|
|
CNY
|
4
|
|
LG Display Singapore Pte. Ltd.
|
|
Singapore
|
|
|
100%
|
|
|
|
December 31
|
|
|
January 12, 2009
|
|
|
Sell Display products
|
|
|
USD
|
1.1
|
|
L&T Display Technology (Fujian) Limited
|
|
Fujian, China
|
|
|
51%
|
|
|
|
December 31
|
|
|
January 5, 2010
|
|
|
Manufacture and sell
LCD module and
LCD monitor sets
|
|
|
CNY
|
116
|
|
LG Display Yantai Co., Ltd.
|
|
Yantai, China
|
|
|
100%
|
|
|
|
December 31
|
|
|
April 19, 2010
|
|
|
Manufacture Display
products
|
|
|
CNY
|
1,008
|
|
Nanumnuri Co., Ltd.
|
|
Gumi,
South Korea
|
|
|
100%
|
|
|
|
December 31
|
|
|
March 21, 2012
|
|
|
Janitorial services
|
|
|
KRW
|
800
|
|
LG Display (China) Co., Ltd.
|
|
Guangzhou, China
|
|
|
70%
|
|
|
|
December 31
|
|
|
December 10, 2012
|
|
|
Manufacture and sell
Display products
|
|
|
CNY
|
8,232
|
|
Unified Innovative Technology, LLC
|
|
Wilmington, U.S.A.
|
|
|
100%
|
|
|
|
December 31
|
|
|
March 12, 2014
|
|
|
Manage intellectual
property
|
|
|
USD
|
9
|
|
LG Display Guangzhou Trading Co., Ltd.
|
|
Guangzhou, China
|
|
|
100%
|
|
|
|
December 31
|
|
|
April 28, 2015
|
|
|
Sell Display products
|
|
|
CNY
|
1.2
|
|
Global OLED Technology, LLC
|
|
Herndon, U.S.A.
|
|
|
100%
|
|
|
|
December 31
|
|
|
December 18, 2009
|
|
|
Manage OLED
intellectual property
|
|
|
USD
|
138
|
|
LG Display Vietnam Haiphong Co., Ltd. (*1)
|
|
Haiphong,
Vietnam
|
|
|
100%
|
|
|
|
December 31
|
|
|
May 5, 2016
|
|
|
Manufacture Display
products
|
|
|
USD
|
300
|
|
Suzhou Lehui Display Co., Ltd.
|
|
Suzhou, China
|
|
|
100%
|
|
|
|
December 31
|
|
|
July 1, 2016
|
|
|
Manufacture and sell
LCD module and
LCD monitor sets
|
|
|
CNY
|
637
|
|
Money Market Trust(*2)
|
|
Seoul,
South Korea
|
|
|
100%
|
|
|
|
December 31
|
|
|
|
|
|
Money market trust
|
|
|
KRW
|
430,801
|
|
(*1)
|
For the three-month period ended March 31, 2018, the Controlling Company contributed
W
212,600 million in cash for the capital increase of LG Display Vietnam Haiphong Co., Ltd.
(LGDVN). There was no change in the Controlling Companys ownership percentage in LGDVN as a result of this additional investment.
|
37
1.
|
Reporting Entity, Continued
|
|
(*2)
|
For the three-month period ended March 31, 2018, the Controlling Company acquired and disposed Money Market Trust (MMT) and the MMT amount as of March 31, 2018 is
W
430,801 million.
|
W
90,281 million is
attributable to the Controlling Company over the distributed dividends from consolidated subsidiaries for the three-month period ended March 31, 2018.
2.
|
Basis of Presenting Financial Statements
|
|
(a)
|
Statement of Compliance
|
The condensed consolidated interim financial statements have
been prepared in accordance with Korean International Financial Reporting Standards
(K-IFRSs)
No.1034,
Interim Financial Reporting
. They do not include all of the information required for
full annual consolidated financial statements and should be read in conjunction with the consolidated financial statements of the Group as of and for the year ended December 31, 2017.
This is the first set of the Groups financial statements where
K-IFRS
No. 1109,
K-IFRS
No. 1115, and
K-IFRS
No. 2122 have been applied. Changes to significant accounting policies are described in Note 3.
The condensed consolidated interim financial statements have been
prepared on the historical cost basis except for the following material items in the statements of financial position:
|
|
|
financial assets at fair value through profit or loss (FVTPL) and financial asset at fair value through other comprehensive income (FVOCI) , and
|
|
|
|
net defined benefit liabilities are recognized as the present value of defined benefit obligations less the fair value of plan assets
|
|
(c)
|
Functional and Presentation Currency
|
The condensed consolidated interim financial
statements are presented in Korean won, which is the Controlling Companys functional currency.
|
(d)
|
Use of Estimates and Judgments
|
The preparation of the condensed consolidated interim
financial statements in conformity with
K-IFRSs
requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets,
liabilities, income and expenses. Actual results may differ from these estimates.
38
2.
|
Basis of Presenting Financial Statements, Continued
|
|
(d)
|
Use of Estimates and Judgments, Continued
|
In result of the Group utilizing the past
accumulated usage information to reassess the economic useful life of the Mask and Mold which has been classified as inventory, the Group expected the useful lives of Mask and Mold to exceed one year; therefore, the Group changed useful lives of
Mask and Mold to two years and treated it as a change in accounting estimate. The Group also changed the classification of Mask and Mold to property, plant and equipment. As a result,
W
111,456 million of
Inventory (supplies) at December 31, 2017 is classified as property, plant and equipment (tools) during the three-month period ended March 31, 2018..
In preparing these condensed consolidated interim financial statements, the significant judgments made by management in applying the
Groups accounting policies and the key sources of estimation uncertainty were the same as those applied in the last annual financial statements, except for new significant judgments and key sources of estimation uncertainty related to the
application of
K-IFRS
No. 1109,
K-IFRS
No. 1115 in Note 3 and the change in useful life of Mask and Mold.
3.
|
Summary of Significant Accounting Policies
|
The significant accounting policies followed
by the Group in the preparation of its condensed consolidated interim financial statements are the same as those followed by the Group in its preparation of the consolidated financial statements as of and for the year ended December 31, 2017,
except for the application of
K-IFRS
No. 1034,
Interim Financial Reporting
and the changes in accounting standards explained below
.
The changes in accounting policies are also expected to be
reflected in the Groups consolidated financial statements as at and for the year ending December 31, 2018.
|
(a)
|
Changes in Accounting Policies
|
The Group has initially adopted
K-IFRS
No. 1115,
Revenue from Contracts with Customers
,
K-IFRS
No. 1109,
Financial Instruments
, and
K-IFRS
No. 2122
, Foreign Currency Transactions and Advance Consideration
from January 1, 2018.
(i)
K-IFRS
No.
1109,
Financial Instruments
K-IFRS
No. 1109 set out requirements for recognizing and measuring financial assets, financial liabilities and some contracts to buy or sell
non-financial
items. This
standards replaces
K-IFRS
No. 1039
Financial Instruments: Recognition and Measurement
. The Group adopted
K-IFRS
No. 1109,
Financial Instruments
,
from January 1, 2018, and the Group has taken an exemption not to restate the financial statements for prior years with respects to transition requirements.
The details of new significant accounting policies and the nature and effect of the changes to previous accounting policies are set out below.
There is no impact on the opening balance of retained earnings at January 1, 2018.
39
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(a)
|
Changes in Accounting Policies, Continued
|
|
i)
|
Classification and measurement of financial assets and financial liabilities
|
K-IFRS
No. 1109 largely retains the existing requirements in
K-IFRS
No. 1039 for the classification and measurement of financial liabilities. However, it eliminates
the previous
K-IFRS
No. 1039 categories for financial assets of held to maturity, loans and receivables and available for sale.
The adoption
K-IFRS
No. 1109 has not had a significant effect on the Groups accounting
policies related to financial liabilities and derivative financial instruments. The impact of
K-IFRS
No. 1109 on the classification and measurement of financial assets is set out below.
Under
K-IFRS
No. 1109, on initial recognition, a financial asset is classified as measured at:
amortized cost; FVOCI-debt investment; FVOCI-equity investment; or FVTPL. The classification of financial assets under
K-IFRS
1109 is generally based on the business model in which a financial asset is managed
and its contractual cash flow characteristics.
A financial asset is measured at amortized cost if it meets both of the following
conditions and is not designated as at FVTPL:
|
|
|
It is held within a business model whose objective is to hold assets to collect contractual cash flow; and
|
|
|
|
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
|
A debt investment is measured at FVOCI if it meets both of the following conditions and is not designated as at FVTPL:
|
|
|
It is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
|
|
|
|
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
|
On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present subsequent changes in
the investments fair value in OCI. This election is made on an
investment-by-investment
basis.
All financial assets not classified as measured at amortized cost or FVOCI as described above are measured at FVTPL. This includes all
derivative financial assets. On initial recognition, the Group may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces
an accounting mismatch that would otherwise arise.
A financial asset (unless it is a trade receivable without a significant financing
component that is initially measured at the transaction price) is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly attributable to its acquisition.
40
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(a)
|
Changes in Accounting Policies, Continued
|
The following accounting policies apply to
the subsequent measurement of financial assets.
|
|
|
|
|
|
|
Financial assets at FVTPL
|
|
These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.
|
|
|
|
|
|
Financial assets at amortized cost
|
|
These assets are subsequently measured at amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized in
profit or loss. Any gain or loss on derecognition is recognized in profit or loss.
|
|
|
|
|
|
Debt investments at FVOCI
|
|
These assets are subsequently measured at fair value. Interest income calculated using the effective interest method, foreign exchange gains and losses and impairment are recognized in profit or loss. Other net gains and losses are
recognized in OCI. On derecognition, gains and losses accumulated in OCI are reclassified to profit or loss.
|
The following table below explain the original measurement categories under
K-IFRS
No. 1039 and the changes in measurement categories under
K-IFRS
No. 1109 for each class of the Groups financial assets as at January 1, 2018
are as below.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Original
classification
under
K-IFRS
No. 1039
|
|
|
New classification
under
K-IFRS
No. 1109
|
|
|
Original
carrying
amount
under
K-IFRS No.
1039
|
|
|
New carrying
amount under
K-IFRS No.
1109
|
|
|
Difference
|
|
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
W
|
2,602,560
|
|
|
|
2,602,560
|
|
|
|
|
|
Deposits
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
|
758,089
|
|
|
|
758,089
|
|
|
|
|
|
Trade receivables
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
|
4,325,120
|
|
|
|
4,325,120
|
|
|
|
|
|
Other receivables
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
|
164,827
|
|
|
|
164,827
|
|
|
|
|
|
Debt instrument
|
|
|
Available-for-sale
|
|
|
|
FVOCI-debt
instrument
|
|
|
|
162
|
|
|
|
162
|
|
|
|
|
|
Equity instrument
|
|
|
Available-for-sale
|
|
|
|
Mandatorily at
FVTPL
|
|
|
|
4,980
|
|
|
|
4,980
|
|
|
|
|
|
Convertible bonds
|
|
|
Designated as at
FVTPL
|
|
|
|
Mandatorily at
FVTPL
|
|
|
|
1,552
|
|
|
|
1,552
|
|
|
|
|
|
Derivatives
|
|
|
Designated as at
FVTPL
|
|
|
|
Mandatorily at
FVTPL
|
|
|
|
842
|
|
|
|
842
|
|
|
|
|
|
Others
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
|
88,290
|
|
|
|
88,290
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total financial assets
|
|
|
|
|
|
|
|
|
|
W
|
7,946,422
|
|
|
|
7,946,422
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of January 1, 2018, there were no financial liabilities measured at FVTPL.
41
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(a)
|
Changes in Accounting Policies, Continued
|
|
ii)
|
Impairment of financial assets
|
K-IFRS
No. 1109
replaces the incurred loss model in
K-IFRS
No. 1039 with an expected credit loss (ECL) model. The new impairment model applies to financial assets measured at amortized cost,
contract assets and debt investments at FVOCI, but not to investments in equity instruments. Under
K-IFRS
No. 1109, credit losses are recognized earlier than under
K-IFRS
No. 1039.
ECLs are a probability-weighted estimate of credit losses. Credit losses
are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Group expects to receive).
At each reporting date, the Group assesses whether financial assets carried at amortized cost and debt instrument at FVOCI are
credit-impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.
Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. For debt instrument
at FVOCI, the loss allowance is recognized in OCI, instead of reducing the carrying amount of the asset.
As a result of applying the loss
allowances model under
K-IFRS
No. 1109, as of January 1, 2018, there are no additional loss allowances as compared with the loss allowances under
K-IFRS
No. 1039.
When initially applying
K-IFRS
No. 1109, the Group elected as its accounting policy to continue to apply hedge accounting requirements under
K-IFRS
No. 1039 instead of the requirements in
K-IFRS
No. 1109. As of January 1, 2018, there is no impact on the consolidated financial statement of the Group resulting from the application of the requirements in
K-IFRS
No. 1109.
|
(ii)
|
K-IFRS
No. 1115,
Revenue from Contracts with Customers
|
K-IFRS
No. 1115,
Revenue from contracts with customers
, establishes a comprehensive
framework for determining whether, how much and when revenue is recognized.
K-IFRS
No. 1115 replaces existing revenue recognition guidance, including
K-IFRS
No. 1018
Revenue
,
K-IFRS
No. 1011,
Construction Contracts
,
K-IFRS
No. 2031,
Revenue: Barter Transactions Involving Advertising
Services
,
K-IFRS
No. 2113,
Customer Loyalty Programmes
,
K-IFRS
No. 2115,
Agreements for the Construction of Real Estate
and
K-IFRS
No. 2118,
Transfers of Assets from Customers
.
The Group has initially applied
K-IFRS
No. 1115,
Revenue from contracts with customers
, from January 1, 2018. Regarding transition to
K-IFRS
No.1115, the Group has decided to apply the
cumulative effect method, i.e. recognizing the cumulative effect of applying
K-IFRS
No. 1115 at the date of initial application, which is January 1, 2018, without restatement of the comparative
periods presented. The impact on its consolidated financial statements resulting from the application of the new standard is as follows.
42
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(a)
|
Changes in Accounting Policies, Continued
|
Variable Consideration
The consideration received from customers may be variable as the Group allows its customers to return their products according to the
contracts. For the year-ended December 31, 2017, the Group recognizes a provision measured at the gross profit for products sold which are expected to be returned. Under
K-IFRS
No. 1115, the Group
shall estimate an amount of variable consideration by using the expected value or the most likely amount, depending on which method the entity expects to better predict the amount of consideration to which it will be entitled and include in the
transaction price some or all of an amount of variable consideration estimated only to the extent that is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when return period expires. The Group
shall recognize refund liability measured at the amount of consideration received (or receivable) to which the Group does not expect to be entitled and a new asset for the right to recover returned goods. As a result of this change, the refund
liability and a new asset for the right to recover returned goods increased by
W
9,789 million, respectively, as of January 1, 2018. There is no impact on the opening balance of retained earnings at
January 1, 2018. (Note 5(d), 13(a))
The effect of the application of
K-IFRS
No. 1115 on
the Groups consolidated interim statement of financial position as of March 31, 2018 is as follows. There is no impact on the consolidated interim statement of comprehensive income and the cash flows for the three-month period ended
March 31, 2018.
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions won)
|
|
|
|
|
|
|
|
|
|
Categories
|
|
Adoption of
K-IFRS No. 1115
|
|
|
Adjustments
|
|
|
Adoption of
K-IFRS No. 1018
|
|
Current Assets Other current assets
|
|
W
|
405,035
|
|
|
|
(6,923
|
)
|
|
|
398,112
|
|
Current Liabilities Provisions
|
|
W
|
74,220
|
|
|
|
(6,923
|
)
|
|
|
67,297
|
|
|
(iii)
|
K-IFRS
No.
2122,
Foreign Currency Transactions and Advance Consideration
|
According to the new interpretation,
K-IFRS
No. 2122,
Foreign Currency Transactions and Advance
Consideration
, the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income (or part of it) is the date on which an entity initially recognizes the
non-monetary
asset or
non-monetary
liability arising from the payment or receipt of advance consideration. If there are multiple payments or receipts in advance, the entity
shall determine a date of the transaction for each payment or receipt of advance consideration. There is no significant impact on the consolidated financial statements of the Group.
43
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(b)
|
New Standards and Amendments Not Yet Adopted
|
The following new standard is effective
for annual periods beginning after January 1, 2018 and earlier application is permitted; however, the Group has not early adopted the following new standard in preparing these condensed consolidated interim financial statements.
|
(i)
|
K-IFRS
No.
1116,
Leases
|
The Group plans to adopt
K-IFRS
No. 1116,
Leases
, in its consolidated financial statements
for annual period beginning on January 1, 2019, assess the financial impact of the adoption of
K-IFRS
No. 1116 and disclose the results in its consolidated financial statements for the year ending
December 31, 2018. As of March 31, 2018, other than the potential impacts described in the consolidated financial statements as of and for the year ended December 31, 2017, there are no significant changes in relation to preparation
for the adoption of this new standard.
44
4.
|
Cash and Cash Equivalents and Deposits in Banks
|
Cash and cash equivalents and deposits in banks as of March 31, 2018 and
December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current assets
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
Demand deposits
|
|
W
|
2,626,689
|
|
|
|
2,602,560
|
|
Deposits in banks
|
|
|
|
|
|
|
|
|
Time deposits
|
|
W
|
797,217
|
|
|
|
685,238
|
|
Restricted cash (*)
|
|
|
73,055
|
|
|
|
72,840
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
870,272
|
|
|
|
758,078
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
Deposits in banks
|
|
|
|
|
|
|
|
|
Restricted cash (*)
|
|
W
|
11
|
|
|
|
11
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,496,972
|
|
|
|
3,360,649
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Restricted cash includes mutual growth fund to aid LG Groups second and third-tier suppliers, pledge to enforce investment plans according to the receipt of subsidies from Gumi city and
Gyeongsangbuk-do
and others.
|
45
5.
|
Receivables and Other Assets
|
|
(a)
|
Trade accounts and notes receivable as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Trade, net
|
|
W
|
2,631,374
|
|
|
|
3,275,902
|
|
Due from related parties
|
|
|
864,789
|
|
|
|
1,049,218
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,496,163
|
|
|
|
4,325,120
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Other accounts receivable as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current assets
|
|
|
|
|
|
|
|
|
Non-trade
receivable, net
|
|
W
|
112,335
|
|
|
|
150,554
|
|
Accrued income
|
|
|
14,034
|
|
|
|
14,273
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
126,369
|
|
|
|
164,827
|
|
|
|
|
|
|
|
|
|
|
Due from related parties included in other accounts receivable, as of March 31, 2018 and
December 31, 2017 are
W
9,945 million and
W
10,821 million, respectively.
46
5.
|
Receivables and Other Assets, Continued
|
|
(c)
|
The aging of trade accounts and note receivable, other accounts receivable and long-term
non-trade
receivable as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
|
Book value
|
|
|
Impairment loss
|
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable(*)
|
|
|
Long-term
non-trade
receivable
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable(*)
|
|
|
Long-term
non-trade
receivable
|
|
Not past due
|
|
W
|
3,487,064
|
|
|
|
119,671
|
|
|
|
185
|
|
|
|
(1,401
|
)
|
|
|
(539
|
)
|
|
|
(2
|
)
|
Past due
1-15
days
|
|
|
9,529
|
|
|
|
478
|
|
|
|
|
|
|
|
(30
|
)
|
|
|
(3
|
)
|
|
|
|
|
Past due
16-30
days
|
|
|
995
|
|
|
|
707
|
|
|
|
|
|
|
|
|
|
|
|
(4
|
)
|
|
|
|
|
Past due
31-60
days
|
|
|
6
|
|
|
|
125
|
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
|
Past due more than 60 days
|
|
|
|
|
|
|
6,412
|
|
|
|
|
|
|
|
|
|
|
|
(477
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,497,594
|
|
|
|
127,393
|
|
|
|
185
|
|
|
|
(1,431
|
)
|
|
|
(1,024
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Other accounts receivable includes
non-trade
receivable and accrued income.
|
47
5.
|
Receivables and Other Assets, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
December 31, 2017
|
|
|
|
Book value
|
|
|
Impairment loss
|
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable(*)
|
|
|
Long-term
non-trade
receivable
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable(*)
|
|
|
Long-term
non-trade
receivable
|
|
Not past due
|
|
W
|
4,323,465
|
|
|
|
164,755
|
|
|
|
8,738
|
|
|
|
(1,631
|
)
|
|
|
(905
|
)
|
|
|
|
|
Past due
1-15
days
|
|
|
2,652
|
|
|
|
488
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
(3
|
)
|
|
|
|
|
Past due
16-30
days
|
|
|
631
|
|
|
|
65
|
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
|
Past due
31-60
days
|
|
|
|
|
|
|
208
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
|
|
Past due more than 60 days
|
|
|
4
|
|
|
|
622
|
|
|
|
|
|
|
|
|
|
|
|
(400
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
4,326,752
|
|
|
|
166,138
|
|
|
|
8,738
|
|
|
|
(1,632
|
)
|
|
|
(1,311
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The movement in the allowance for impairment in respect of trade accounts and notes receivable, other accounts
receivable and long-term
non-trade
receivable for the three-month period ended March 31, 2018 and the year ended December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
2017
|
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable
|
|
|
Long-term
non-trade
receivable
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable
|
|
|
Long-term
non-trade
receivable
|
|
Balance at the beginning of the period
|
|
W
|
1,632
|
|
|
|
1,311
|
|
|
|
|
|
|
|
1,488
|
|
|
|
1,093
|
|
|
|
23
|
|
(Reversal of) bad debt expense
|
|
|
(201
|
)
|
|
|
(287
|
)
|
|
|
2
|
|
|
|
144
|
|
|
|
218
|
|
|
|
(23
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the reporting date
|
|
W
|
1,431
|
|
|
|
1,024
|
|
|
|
2
|
|
|
|
1,632
|
|
|
|
1,311
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
48
5.
|
Receivables and Other Assets, Continued
|
|
(d)
|
Other assets as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current assets
|
|
|
|
|
|
|
|
|
Advance payments
|
|
W
|
12,372
|
|
|
|
7,973
|
|
Prepaid expenses
|
|
|
239,234
|
|
|
|
83,626
|
|
Value added tax refundable
|
|
|
146,506
|
|
|
|
148,351
|
|
Emission rights
|
|
|
|
|
|
|
1,978
|
|
Right to recover returned goods(*)
|
|
|
6,923
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
405,035
|
|
|
|
241,928
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
Long-term prepaid expenses
|
|
W
|
391,904
|
|
|
|
394,759
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
391,904
|
|
|
|
394,759
|
|
|
|
|
|
|
|
|
|
|
(*)
|
As a result from the initial application of
K-IFRS
No. 1115, the Group recognized an asset for right to recover returned goods returned by the customer.
|
49
6.
|
Other Financial Assets
|
|
(a)
|
Other financial assets as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
Current assets
|
|
|
|
|
Financial Asset at Fair Value through Other Comprehensive Income
|
|
|
|
|
Debt instrument
|
|
|
|
|
Government bonds
|
|
W
|
6
|
|
Financial Asset Carried at Amortized Cost
|
|
|
|
|
Deposits
|
|
W
|
2,292
|
|
Short-term loans
|
|
|
15,094
|
|
|
|
|
|
|
Total
|
|
W
|
17,392
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Financial Asset at Fair Value through Profit or Loss
|
|
|
|
|
Equity instrument
|
|
|
|
|
Intellectual Discovery, Ltd.
|
|
W
|
729
|
|
Kyulux, Inc
|
|
|
1,968
|
|
ARCH Venture Fund Vill, L.P.
|
|
|
2,311
|
|
|
|
|
|
|
Sub-Total
|
|
|
5,008
|
|
Convertible bonds
|
|
|
1,552
|
|
Derivatives(*)
|
|
|
600
|
|
Financial Asset at Fair Value through Other Comprehensive Income
|
|
|
|
|
Debt instrument
|
|
|
|
|
Government bonds
|
|
W
|
157
|
|
Financial Asset Carried at Amortized Cost
|
|
|
|
|
Deposits
|
|
W
|
20,123
|
|
Long-term loans
|
|
|
37,296
|
|
Long-term
non-trade
receivable
|
|
|
183
|
|
|
|
|
|
|
Total
|
|
W
|
64,919
|
|
|
|
|
|
|
(*)
|
Represents interest rate swap contracts related to borrowings with variable interest rate.
|
50
6.
|
Other Financial Assets, Continued
|
|
(ii)
|
As of December 31, 2017
|
|
|
|
|
|
(In millions of won)
|
|
December 31, 2017
|
|
Current assets
|
|
|
|
|
Available-for-sale
financial assets
|
|
|
|
|
Debt instrument
|
|
|
|
|
Government bonds
|
|
W
|
6
|
|
Deposits
|
|
|
10,480
|
|
Short-term loans
|
|
|
16,766
|
|
|
|
|
|
|
Total
|
|
W
|
27,252
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Financial Asset at Fair Value through Profit or Loss
|
|
W
|
1,552
|
|
Available-for-sale
financial
assets
|
|
|
|
|
Debt instrument
|
|
|
|
|
Government bonds
|
|
W
|
156
|
|
Equity instrument
|
|
|
|
|
Intellectual Discovery, Ltd.
|
|
W
|
729
|
|
Kyulux, Inc
|
|
|
1,968
|
|
ARCH Venture Fund Vill, LP.
|
|
|
2,283
|
|
|
|
|
|
|
Sub-Total
|
|
W
|
4,980
|
|
Deposits
|
|
W
|
19,898
|
|
Long-term loans
|
|
|
32,408
|
|
Long-term
non-trade
receivable
|
|
|
8,738
|
|
Derivatives(*)
|
|
|
842
|
|
|
|
|
|
|
Total
|
|
W
|
68,574
|
|
|
|
|
|
|
(*)
|
Represents interest rate swap contracts related to borrowings with variable interest rate.
|
Other financial assets of related parties as of March 31, 2018 and December 31, 2017 are
W
2,500 million and
W
2,750 million, respectively.
51
Inventories as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Finished goods
|
|
W
|
1,041,615
|
|
|
|
965,643
|
|
Work-in-process
|
|
|
760,491
|
|
|
|
748,592
|
|
Raw materials
|
|
|
367,924
|
|
|
|
344,997
|
|
Supplies
|
|
|
180,355
|
|
|
|
290,852
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
2,350,385
|
|
|
|
2,350,084
|
|
|
|
|
|
|
|
|
|
|
For the three-month periods ended March 31, 2018 and 2017, the amount of inventories recognized as cost
of sales, inventory write-downs and reversal and usage of inventory write-downs included in cost of sales are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
2017
|
|
Inventories recognized as cost of sales
|
|
W
|
5,133,080
|
|
|
|
5,342,882
|
|
Including: inventory write-downs
|
|
|
210,188
|
|
|
|
215,228
|
|
Including: reversal and usage of inventory write-downs
|
|
|
(206,127
|
)
|
|
|
(204,123
|
)
|
52
8.
|
Investments in Equity Accounted Investees
|
Associates as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Associates
|
|
Location
|
|
Fiscal year
end
|
|
Date of
incorporation
|
|
Business
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
|
|
|
|
Percentage
of ownership
|
|
|
Carrying
amount
|
|
|
Percentage
of ownership
|
|
|
Carrying
amount
|
|
Paju Electric Glass Co., Ltd.
|
|
Paju,
South Korea
|
|
December 31
|
|
January
2005
|
|
Manufacture electric glass for FPDs
|
|
|
40
|
%
|
|
W
|
44,179
|
|
|
|
40
|
%
|
|
W
|
46,511
|
|
INVENIA Co., Ltd.
|
|
Seongnam,
South Korea
|
|
December 31
|
|
January
2001
|
|
Develop and manufacture equipment for FPDs
|
|
|
13
|
%
|
|
|
3,125
|
|
|
|
13
|
%
|
|
|
2,887
|
|
WooRee E&L Co., Ltd.
|
|
Ansan,
South Korea
|
|
December 31
|
|
June
2008
|
|
Manufacture LED back light unit packages
|
|
|
14
|
%
|
|
|
3,506
|
|
|
|
14
|
%
|
|
|
7,270
|
|
LB Gemini New Growth Fund No. 16 (*1)
|
|
Seoul,
South Korea
|
|
December 31
|
|
December
2009
|
|
Invest in small and middle sized companies and benefit from M&A opportunities
|
|
|
31
|
%
|
|
|
5,282
|
|
|
|
31
|
%
|
|
|
5,910
|
|
YAS Co., Ltd.
|
|
Paju,
South Korea
|
|
December 31
|
|
April
2002
|
|
Develop and manufacture deposition equipment for OLEDs
|
|
|
15
|
%
|
|
|
16,045
|
|
|
|
15
|
%
|
|
|
15,888
|
|
AVATEC Co., Ltd.
|
|
Daegu,
South Korea
|
|
December 31
|
|
August
2000
|
|
Process and sell electric glass for FPDs
|
|
|
17
|
%
|
|
|
23,252
|
|
|
|
17
|
%
|
|
|
23,732
|
|
Arctic Sentinel, Inc.
|
|
Los Angeles,
U.S.A.
|
|
March 31
|
|
June
2008
|
|
Develop and manufacture
tablet for kids
|
|
|
10
|
%
|
|
|
|
|
|
|
10
|
%
|
|
|
|
|
53
8.
|
Investments in Equity Accounted Investees, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Associates
|
|
Location
|
|
|
Fiscal
year end
|
|
|
Date of
incorporation
|
|
|
Business
|
|
2018
|
|
|
2017
|
|
|
|
|
|
|
Percentage
of
ownership
|
|
|
Carrying
amount
|
|
|
Percentage
of
ownership
|
|
|
Carrying
amount
|
|
CYNORA GmbH
|
|
|
Bruchsal,
Germany
|
|
|
|
December 31
|
|
|
|
March
2003
|
|
|
Develop organic emitting materials for displays and lighting devices
|
|
|
14
|
%
|
|
W
|
20,309
|
|
|
|
14
|
%
|
|
W
|
20,309
|
|
Material Science (*2)
|
|
|
Seoul,
South
Korea
|
|
|
|
December 31
|
|
|
|
January
2014
|
|
|
Develop, manufacture, and sales of OLED materials
|
|
|
10
|
%
|
|
|
4,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
119,698
|
|
|
|
|
|
|
W
|
122,507
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Although the Controlling Companys share interests in INVENIA Co., Ltd., WooRee E&L Co., Ltd., YAS
Co., Ltd., AVATEC Co., Ltd., Arctic Sentinel, Inc., Cynora GmbH, and Material Science are below 20%, the Controlling Company is able to exercise significant influence through its right to appoint a director to the board of directors of each
investee. Accordingly, the investments in these investees have been accounted for using the equity method.
54
8.
|
Investments in Equity Accounted Investees, Continued
|
|
(*1)
|
The Controlling Company is a member of a limited partnership in the LB Gemini New Growth Fund No.16 (the Fund). On the other hand, a resolution to dissolve the fund was approved at the general meeting and
the fund is in process of liquidation as of March 31, 2018.
|
|
(*2)
|
In March 2018, the Controlling Company invested
W
4,000 million and acquired 10,767 shares of common stock with voting rights in Material Science. As of March 31, 2018, the
Controlling Companys ownership percentage in Material Science is 10% and the Controlling Company has the right to appoint a director to the board of directors of the investee.
|
Dividends received from equity method investees for the three-month periods ended March 31, 2018 and 2017 amounted to
W
5,272 million and
W
8,639 million, respectively.
9.
|
Property, Plant and Equipment
|
For the three-month periods ended March 31, 2018 and
2017, the Group purchased property, plant and equipment of
W
1,974,223 million and
W
1,767,834 million, respectively. The capitalized borrowing costs and the annualized
capitalization rate were
W
19,912 million and 2.23%, and
W
6,260 million and 1.84% for the three-month periods ended March 31, 2018 and 2017, respectively. Also, for
the three-month periods ended March 31, 2018 and 2017, the Group disposed of property, plant and equipment with carrying amounts of
W
61,868 million and
W
22,596 million, respectively, and recognized
W
4,006 million and
W
8,405 million, respectively, as gain and loss, on disposal of
property, plant and equipment for the three-month period ended March 31, 2018 (gain and loss for the three-month period ended March 31, 2017:
W
11,560 million and
W
2,231 million, respectively).
|
(a)
|
The Group capitalizes expenditures related to development activities, such as expenditures incurred on designing, manufacturing and testing of products after those related activities meet the capitalization criteria of
development costs including technical feasibility, future economic benefits and others. The balances of capitalized development costs as of March 31, 2018 and December 31, 2017 are
W
316,914 million
and
W
296,760 million, respectively.
|
|
(b)
|
Development of new projects are divided into research activities and development activities. Expenditures on research activities are recognized in profit or loss and development expenditures are capitalized,
respectively.
|
55
11.
|
Financial Liabilities
|
|
(a)
|
Financial liabilities as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current
|
|
|
|
|
|
|
|
|
Current portion of long-term borrowings and bonds
|
|
W
|
2,148,016
|
|
|
|
1,452,926
|
|
Non-current
|
|
|
|
|
|
|
|
|
Won denominated borrowings
|
|
W
|
1,701,096
|
|
|
|
1,251,258
|
|
Foreign currency denominated borrowings
|
|
|
987,714
|
|
|
|
1,392,931
|
|
Bonds
|
|
|
1,894,864
|
|
|
|
1,506,003
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
4,583,674
|
|
|
|
4,150,192
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Won denominated long-term borrowings as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won)
|
|
|
|
|
|
|
|
|
|
Lender
|
|
Annual interest rate
as of
March 31, 2018 (%)
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
Woori Bank
|
|
|
3-year Korean Treasury
Bond rate - 1.25, 2.75
|
|
|
W
|
1,753
|
|
|
|
1,922
|
|
Shinhan Bank
|
|
|
CD rate (91days) + 0.30
|
|
|
|
200,000
|
|
|
|
200,000
|
|
Korea Development Bank and others
|
|
|
CD rate (91days) + 0.64~0.74
2.28~3.25
|
|
|
|
2,050,000
|
|
|
|
1,250,000
|
|
Less current portion of long-term borrowings
|
|
|
|
|
|
|
(550,657
|
)
|
|
|
(200,664
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,701,096
|
|
|
|
1,251,258
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
56
11.
|
Financial Liabilities, Continued
|
|
(c)
|
Foreign currency denominated long-term borrowings as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won, USD and CNY)
|
|
Lender
|
|
Annual interest rate
as of
March 31, 2018 (%)(*)
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
The
Export
Import
Bank
of
Korea and others
|
|
|
3ML+0.55~1.04
|
|
|
W
|
751,882
|
|
|
|
755,337
|
|
China Construction Bank and others
|
|
|
USD: 3ML+0.80~2.00
CNY: 4.28
|
|
|
|
1,508,289
|
|
|
|
1,385,097
|
|
Foreign currency equivalent
|
|
|
|
|
|
USD
|
1,600
|
|
|
USD
|
1,500
|
|
|
|
|
|
|
|
CNY
|
3,263
|
|
|
CNY
|
3,263
|
|
Less current portion of long-term borrowings
|
|
|
|
|
|
|
(1,272,457
|
)
|
|
|
(747,503
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
987,714
|
|
|
|
1,392,931
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
ML represents Month LIBOR (London Inter-Bank Offered Rates).
|
|
(d)
|
Details of bonds issued and outstanding as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maturity
|
|
|
Annual interest rate
as of
March 31, 2018 (%)
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
Won denominated bonds(*)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Publicly issued bonds
|
|
|
May 2018 ~
February 2023
|
|
|
|
1.73~3.73
|
|
|
W
|
2,225,000
|
|
|
|
2,015,000
|
|
Less discount on bonds
|
|
|
|
|
|
|
|
|
|
|
(5,234
|
)
|
|
|
(4,238
|
)
|
Less current portion
|
|
|
|
|
|
|
|
|
|
|
(324,902
|
)
|
|
|
(504,759
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,894,864
|
|
|
|
1,506,003
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Principal of the won denominated bonds is to be repaid at maturity and interests are paid quarterly.
|
57
The Controlling Company and certain subsidiaries defined
benefit plans provide a
lump-sum
payment to an employee based on final salary rates and length of service at the time the employee leaves the Controlling Company or certain subsidiaries.
The defined benefit plans expose the Group to actuarial risks, such as the risk associated with expected periods of service, interest rate
risk, market (investment) risk, and others.
|
(a)
|
Net defined benefit liabilities recognized as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Present value of partially funded defined benefit obligations
|
|
W
|
1,595,490
|
|
|
|
1,562,424
|
|
Fair value of plan assets
|
|
|
(1,444,511
|
)
|
|
|
(1,466,977
|
)
|
|
|
|
|
|
|
|
|
|
|
|
W
|
150,979
|
|
|
|
95,447
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Expenses recognized in profit or loss for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Current service cost
|
|
W
|
51,559
|
|
|
|
48,751
|
|
Net interest cost
|
|
|
242
|
|
|
|
598
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
51,801
|
|
|
|
49,349
|
|
|
|
|
|
|
|
|
|
|
|
(c)
|
Plan assets as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Guaranteed deposits in banks
|
|
W
|
1,444,511
|
|
|
|
1,466,977
|
|
As of March 31, 2018, the Controlling Company maintains the plan assets primarily with Mirae Asset Daewoo
Co., Ltd., Shinhan Bank and others.
|
(d)
|
Remeasurements of the net defined benefit liabilities (assets) included in other comprehensive income (loss) for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
2017
|
|
Remeasurements of the net defined benefit liabilities
|
|
W
|
(6,419
|
)
|
|
|
(4,725
|
)
|
Tax effect
|
|
|
2,296
|
|
|
|
1,143
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of the net defined benefit liabilities, net of income tax
|
|
W
|
(4,123
|
)
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
|
|
|
58
13.
|
Provisions and Other Liabilities
|
|
(a)
|
Changes in provisions for the three-month period ended March 31, 2018 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Litigations
and claims
|
|
|
Warranties (*)
|
|
|
Others
|
|
|
Total
|
|
Balance at January 1, 2018
|
|
W
|
43
|
|
|
|
102,450
|
|
|
|
1,835
|
|
|
|
104,328
|
|
Adjustment from adoption of
K-IFRS
1115
|
|
|
|
|
|
|
|
|
|
|
9,789
|
|
|
|
9,789
|
|
Additions (reversals)
|
|
|
|
|
|
|
35,647
|
|
|
|
(3,834
|
)
|
|
|
31,813
|
|
Usage
|
|
|
|
|
|
|
(49,075
|
)
|
|
|
|
|
|
|
(49,075
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at March 31, 2018
|
|
W
|
43
|
|
|
|
89,022
|
|
|
|
7,790
|
|
|
|
96,855
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
|
|
W
|
43
|
|
|
|
66,387
|
|
|
|
7,790
|
|
|
|
74,220
|
|
Non-current
|
|
W
|
|
|
|
|
22,635
|
|
|
|
|
|
|
|
22,635
|
|
|
(*)
|
The provision for warranties covers defective products and is normally applicable for 18 months from the date of purchase. The warranty liability is calculated by using historical and anticipated rates of warranty
claims, and costs per claim to satisfy the Groups warranty obligation.
|
|
(b)
|
Other liabilities as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
Withholdings
|
|
W
|
57,920
|
|
|
|
63,766
|
|
Unearned revenues
|
|
|
10,536
|
|
|
|
12,225
|
|
Security deposits
|
|
|
3,230
|
|
|
|
|
|
Dividends payable
|
|
|
231,608
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
303,294
|
|
|
|
75,991
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
|
Long-term accrued expenses
|
|
W
|
77,671
|
|
|
|
70,561
|
|
Security deposits
|
|
|
2,545
|
|
|
|
|
|
Long-term other accounts payable
|
|
|
2
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
80,218
|
|
|
|
70,563
|
|
|
|
|
|
|
|
|
|
|
59
14.
|
Contingencies and Commitments
|
Anti-trust Litigations
Argos Limited and affiliated companies (Argos) filed a Notice of Claim against the Controlling Company and LG Display Taiwan Co.,
Ltd. in the High Court of Justice in London alleging infringement of Treaty on the Functioning of the European Union and Agreement on the European Economic Area. Prior to Argos filing of Particulars of Claim and service, the Controlling
Company and LG Display Taiwan Co., Ltd. reached a settlement in principle with Argos in December 2017. The parties expect to execute a settlement agreement in 2018.
Others
The Group
is defending against various claims in addition to pending proceedings described above. The Group does not have a present obligation for these matters and has not recognized any provision at March 31, 2018.
Factoring and securitization of accounts receivable
The Controlling Company has agreements with Korea Development Bank and several other banks for accounts receivable sales negotiating facilities
of up to an aggregate of USD 1,743 million (
W
1,859,421 million) in connection with the Controlling Companys export sales transactions with its subsidiaries. As of March 31, 2018, no short-term
borrowings were outstanding in connection with these agreements. In connection with all of the contracts in this paragraph, the Controlling Company has sold its accounts receivable with recourse.
60
14.
|
Contingencies and Commitments, Continued
|
The Controlling Company and oversea subsidiaries entered into agreements with financial
institutions for accounts receivables sales negotiating facilities. The respective maximum amount of accounts receivables sales and the amount of sold accounts receivables before maturity by contract are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of USD and KRW)
|
|
Classification
|
|
Financial institutions
|
|
Maximum
|
|
|
Not yet due
|
|
|
|
|
|
Contractual
amount
|
|
|
KRW
equivalent
|
|
|
Contractual
amount
|
|
|
KRW
equivalent
|
|
Controlling Company
|
|
Shinhan Bank
|
|
KRW
|
90,000
|
|
|
|
90,000
|
|
|
|
|
|
|
|
|
|
|
|
Sumitomo Mitsui Banking Corporation
|
|
USD
|
20
|
|
|
|
21,330
|
|
|
|
|
|
|
|
|
|
|
|
Bank of Tokyo-Mitsubishi UFJ
|
|
USD
|
70
|
|
|
|
74,655
|
|
|
|
|
|
|
|
|
|
|
|
BNP Paribas
|
|
USD
|
150
|
|
|
|
159,975
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
240
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
KRW
|
90,000
|
|
|
|
345,960
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Singapore Pte. Ltd.
|
|
Standard Chartered Bank
|
|
USD
|
300
|
|
|
|
319,950
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Taiwan Co., Ltd.
|
|
BNP Paribas
|
|
USD
|
82
|
|
|
|
87,453
|
|
|
|
|
|
|
|
|
|
|
|
Hongkong & Shanghai Banking Corp.
|
|
USD
|
60
|
|
|
|
63,990
|
|
|
|
|
|
|
|
|
|
|
|
Taishin International Bank
|
|
USD
|
280
|
|
|
|
298,620
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Germany GmbH
|
|
Citibank
|
|
USD
|
160
|
|
|
|
170,640
|
|
|
|
|
|
|
|
|
|
|
BNP Paribas
|
|
USD
|
75
|
|
|
|
79,988
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display America, Inc.
|
|
Hongkong & Shanghai Banking Corp.
|
|
USD
|
400
|
|
|
|
426,600
|
|
|
USD
|
150
|
|
|
|
159,975
|
|
|
|
Standard Chartered Bank
|
|
USD
|
400
|
|
|
|
426,600
|
|
|
|
|
|
|
|
|
|
|
|
Sumitomo Mitsui
Banking Corporation
|
|
USD
|
250
|
|
|
|
266,625
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Japan Co., Ltd.
|
|
Sumitomo Mitsui
Banking Corporation
|
|
USD
|
90
|
|
|
|
95,985
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Guangzhou Trading Co., Ltd.
|
|
Industrial and Commercial Bank of China
|
|
USD
|
64
|
|
|
|
68,256
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
2,161
|
|
|
|
2,304,707
|
|
|
USD
|
150
|
|
|
|
159,975
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
2,401
|
|
|
|
|
|
|
USD
|
150
|
|
|
|
|
|
|
|
|
|
KRW
|
90,000
|
|
|
|
2,650,667
|
|
|
|
|
|
|
|
159,975
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In connection with all of the contracts in the above table, the Controlling Company has sold its accounts
receivable without recourse.
61
14.
|
Contingencies and Commitments, Continued
|
Letters of credit
As of March 31, 2018, the Controlling Company has agreements in relation to the opening of letters of credit up to USD 30 million
(
W
31,995 million) with KEB Hana Bank, USD 80 million (
W
85,320 million) with Bank of China and USD 50 million (
W
53,325 million) with
Sumitomo Mitsui Banking Corporation.
Payment guarantees
The Controlling Company obtained payment guarantees amounting to USD 900 million (
W
959,850 million) from
KEB Hana Bank and others for advance received related to the long-term supply agreements and USD 8.5 million (
W
9,065 million) from Shinhan Bank for value added tax payments in Poland.
LG Display (China) Co., Ltd. and other subsidiaries are provided with payment guarantees from the China Construction Bank Corporation and
other various banks amounting to CNY 1,065 million (
W
180,709 million), JPY 900 million (
W
9,013million), EUR 2.5 million (
W
3,280
million), VND 41,902 million (
W
1,961 million), USD 0.5 million (
W
533 million), PLN 0.2 million (
W
62 million) and, respectively, for
their local tax payments and utility payments.
Credit facility
LG Display Vietnam Co., Ltd. and other subsidiary have entered into long-term credit facility agreements of up to USD 650 million
(
W
693,225 million) with Sumitomo Mitsui Banking Corporation and other various banks and borrowings as of March 31, 2018 amounting to USD 595 million (
W
634,568 million).
License agreements
As of March 31, 2018, in relation to its LCD business, the Group has technical license agreements with Hitachi Display, Ltd. and others
and has a trademark license agreement with LG Corp.
Long-term supply agreement
As of March 31, 2018, in connection with
long-term
supply agreements with customers, the
Controlling Company recognized USD 900 million (
W
959,850 million) in advances received. The advances received will be offset against outstanding accounts receivable balances after a given period of time, as
well as those arising from the supply of products thereafter. The Controlling Company received payment guarantees amounting to USD 900 million (
W
959,850 million) from KEB Hana Bank and other various banks
relating to advances received.
Pledged Assets
Regarding the secured bank borrowing amounting to USD 300 million (
W
320,089 million) and CNY
1,964 million (
W
333,218 million) from China Construction Bank, as of March 31, 2018, the Group provided its property, plant and equipment and others with carrying amount of
W
297,720 million as pledged assets.
62
The Controlling Company is authorized to issue 500,000,000 shares of capital
stock (par value
W
5,000), and as of March 31, 2018 and December 31, 2017, the number of issued common shares is 357,815,700. There have been no changes in the capital stock from January 1, 2017 to
March 31, 2018.
Reserves consist mainly of the following:
Translation reserve
The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign
operations.
Other comprehensive income (loss) from associates
The other comprehensive income (loss) from associates comprises the amount related to change in equity of investments in equity accounted
investees.
Reserves as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Foreign currency translation differences for foreign operations
|
|
W
|
(154,824
|
)
|
|
|
(259,749
|
)
|
Other comprehensive income (loss) from associates (excluding remeasurements)
|
|
|
(27,216
|
)
|
|
|
(28,531
|
)
|
|
|
|
|
|
|
|
|
|
|
|
W
|
(182,040
|
)
|
|
|
(288,280
|
)
|
|
|
|
|
|
|
|
|
|
63
Details of revenue for the three-month periods ended March 31, 2018 and
2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Sales of goods
|
|
W
|
5,664,450
|
|
|
|
7,050,908
|
|
Royalties
|
|
|
5,408
|
|
|
|
6,544
|
|
Others
|
|
|
5,306
|
|
|
|
4,710
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
5,675,164
|
|
|
|
7,062,162
|
|
|
|
|
|
|
|
|
|
|
17.
|
Geographic and Other Information
|
The following is a summary of sales by region based on
the location of the customers for the three-month periods ended March 31, 2018 and 2017.
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
Revenue
|
|
Region
|
|
2018
|
|
|
2017
|
|
Domestic
|
|
W
|
434,113
|
|
|
|
543,211
|
|
Foreign
|
|
|
|
|
|
|
|
|
China
|
|
|
3,596,291
|
|
|
|
4,649,492
|
|
Asia (excluding China)
|
|
|
402,274
|
|
|
|
577,719
|
|
United States
|
|
|
613,913
|
|
|
|
647,877
|
|
Europe (excluding Poland) 685,232
|
|
|
346,052
|
|
|
|
282,313
|
|
Poland
|
|
|
282,521
|
|
|
|
361,550
|
|
|
|
|
|
|
|
|
|
|
Sub-total
|
|
W
|
5,241,051
|
|
|
|
6,518,951
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
W
|
5,675,164
|
|
|
|
7,062,162
|
|
|
|
|
|
|
|
|
|
|
Sales to Company A and Company B amount to
W
1,746,536 million and
W
1,376,329 million, respectively, for the three-month period ended March 31, 2018 (the three-month period ended March 31, 2017:
W
2,192,166 million and
W
1,750,828 million). The Groups top ten
end-brand
customers together accounted for 78% of sales for the three-month period ended March 31, 2018 (the three-month
period ended March 31, 2017: 81%).
64
17.
|
Geographic and Other Information, Continued
|
|
(b)
|
Non-current
assets by geography
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Region
|
|
Property, plant
and equipment
|
|
|
Intangible
assets
|
|
|
Property, plant
and equipment
|
|
|
Intangible
assets
|
|
Domestic
|
|
W
|
13,669,229
|
|
|
|
738,473
|
|
|
|
12,487,111
|
|
|
|
731,373
|
|
Foreign
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
China
|
|
|
2,884,856
|
|
|
|
15,138
|
|
|
|
2,929,739
|
|
|
|
17,244
|
|
Others
|
|
|
971,031
|
|
|
|
158,591
|
|
|
|
785,110
|
|
|
|
164,204
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sub-total
|
|
|
3,855,887
|
|
|
|
173,729
|
|
|
|
3,714,849
|
|
|
|
181,448
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
W
|
17,525,116
|
|
|
|
912,202
|
|
|
|
16,201,960
|
|
|
|
912,821
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c)
|
Revenue by product and services
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
Revenue
|
|
Product
|
|
2018
|
|
|
2017
|
|
Televisions
|
|
W
|
2,413,750
|
|
|
|
2,999,624
|
|
Desktop monitors
|
|
|
936,031
|
|
|
|
1,073,092
|
|
Tablet products
|
|
|
476,129
|
|
|
|
584,843
|
|
Notebook computers
|
|
|
589,699
|
|
|
|
575,622
|
|
Mobile and others
|
|
|
1,259,555
|
|
|
|
1,828,981
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
5,675,164
|
|
|
|
7,062,162
|
|
|
|
|
|
|
|
|
|
|
18.
|
The Nature of Expenses and Others
|
The classification of expenses by nature for the
three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Changes in inventories
|
|
W
|
(301
|
)
|
|
|
4,616
|
|
Purchases of raw materials, merchandise and others
|
|
|
2,748,830
|
|
|
|
3,333,784
|
|
Depreciation and amortization
|
|
|
910,075
|
|
|
|
715,864
|
|
Outsourcing fees
|
|
|
269,017
|
|
|
|
182,800
|
|
Labor costs
|
|
|
857,684
|
|
|
|
770,690
|
|
Supplies and others
|
|
|
244,164
|
|
|
|
251,715
|
|
Utility
|
|
|
221,269
|
|
|
|
200,501
|
|
Fees and commissions
|
|
|
191,706
|
|
|
|
161,733
|
|
Shipping costs
|
|
|
54,425
|
|
|
|
56,327
|
|
Advertising
|
|
|
14,944
|
|
|
|
44,489
|
|
Warranty expenses
|
|
|
35,647
|
|
|
|
75,850
|
|
Travel
|
|
|
26,130
|
|
|
|
18,939
|
|
Taxes and dues
|
|
|
28,687
|
|
|
|
21,100
|
|
Others
|
|
|
181,613
|
|
|
|
203,507
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
5,783,890
|
|
|
|
6,041,915
|
|
|
|
|
|
|
|
|
|
|
Total expenses consist of cost of sales, selling, administrative, research and development expenses and other
non-operating
expenses, excluding foreign exchange differences.
65
19.
|
Selling and Administrative Expenses
|
Details of selling and administrative expenses for
the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Salaries
|
|
W
|
91,063
|
|
|
|
81,250
|
|
Expenses related to defined benefit plans
|
|
|
7,484
|
|
|
|
6,884
|
|
Other employee benefits
|
|
|
23,072
|
|
|
|
22,707
|
|
Shipping costs
|
|
|
45,871
|
|
|
|
48,589
|
|
Fees and commissions
|
|
|
48,697
|
|
|
|
46,984
|
|
Depreciation
|
|
|
39,795
|
|
|
|
34,769
|
|
Taxes and dues
|
|
|
13,107
|
|
|
|
8,961
|
|
Advertising
|
|
|
14,944
|
|
|
|
44,489
|
|
Warranty expenses
|
|
|
35,647
|
|
|
|
75,850
|
|
Rent
|
|
|
6,649
|
|
|
|
8,023
|
|
Insurance
|
|
|
2,883
|
|
|
|
2,895
|
|
Travel
|
|
|
6,178
|
|
|
|
6,485
|
|
Training
|
|
|
2,567
|
|
|
|
3,546
|
|
Others
|
|
|
17,331
|
|
|
|
16,721
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
355,288
|
|
|
|
408,153
|
|
|
|
|
|
|
|
|
|
|
Details of personnel expenses for the three-month periods ended
March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Salaries and wages
|
|
W
|
713,434
|
|
|
|
630,335
|
|
Other employee benefits
|
|
|
138,184
|
|
|
|
119,744
|
|
Contributions to National Pension plan
|
|
|
18,807
|
|
|
|
17,917
|
|
Expenses related to defined benefit plan
|
|
|
51,801
|
|
|
|
49,349
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
922,226
|
|
|
|
817,345
|
|
|
|
|
|
|
|
|
|
|
66
21.
|
Other
Non-operating
Income and Other
Non-operating
Expenses
|
|
(a)
|
Details of other
non-operating
income for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Foreign currency gain
|
|
W
|
220,470
|
|
|
|
366,959
|
|
Gain on disposal of property, plant and equipment
|
|
|
4,006
|
|
|
|
11,560
|
|
Gain on disposal of intangible assets
|
|
|
239
|
|
|
|
|
|
Reversal of impairment loss on intangible assets
|
|
|
130
|
|
|
|
|
|
Rental income
|
|
|
333
|
|
|
|
1,413
|
|
Others
|
|
|
2,464
|
|
|
|
4,457
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
227,642
|
|
|
|
384,389
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Details of other
non-operating
expenses for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Foreign currency loss
|
|
W
|
202,434
|
|
|
|
573,863
|
|
Loss on disposal of property, plant and equipment
|
|
|
8,405
|
|
|
|
2,231
|
|
Impairment loss on intangible assets
|
|
|
37
|
|
|
|
1,689
|
|
Donations
|
|
|
1,866
|
|
|
|
2,374
|
|
Other bad debt expenses
|
|
|
45
|
|
|
|
|
|
Expenses related to legal proceedings or claims and others
|
|
|
50
|
|
|
|
336
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
212,837
|
|
|
|
580,493
|
|
|
|
|
|
|
|
|
|
|
67
22.
|
Finance Income and Finance Costs
|
|
(a)
|
Finance income and costs recognized in profit and loss for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Finance income
|
|
|
|
|
|
|
|
|
Interest income
|
|
W
|
19,469
|
|
|
|
12,108
|
|
Foreign currency gain
|
|
|
101,492
|
|
|
|
102,228
|
|
Gain on transaction of derivatives
|
|
|
36
|
|
|
|
|
|
Gain on valuation of derivatives
|
|
|
|
|
|
|
798
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
120,997
|
|
|
|
115,134
|
|
|
|
|
|
|
|
|
|
|
Finance costs
|
|
|
|
|
|
|
|
|
Interest expense
|
|
W
|
22,759
|
|
|
|
25,757
|
|
Foreign currency loss
|
|
|
106,304
|
|
|
|
38,721
|
|
Loss on disposal of investments in equity accounted investees
|
|
|
|
|
|
|
23,200
|
|
Loss on sale of trade accounts and notes receivable
|
|
|
345
|
|
|
|
30
|
|
Loss on transaction of derivatives
|
|
|
38
|
|
|
|
101
|
|
Loss on valuation of derivatives
|
|
|
242
|
|
|
|
|
|
Others
|
|
|
673
|
|
|
|
228
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
130,361
|
|
|
|
88,037
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Finance income and costs recognized in other comprehensive income or loss for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Foreign currency translation differences for foreign operations
|
|
W
|
127,890
|
|
|
|
(249,677
|
)
|
|
|
|
|
|
|
|
|
|
Finance income (costs) recognized in other comprehensive income or loss after tax
|
|
W
|
127,890
|
|
|
|
(249,677
|
)
|
|
|
|
|
|
|
|
|
|
68
|
(a)
|
Details of income tax expense for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Current tax expense
|
|
W
|
49,384
|
|
|
|
123,970
|
|
Deferred tax expense (benefit)
|
|
|
(96,177
|
)
|
|
|
54,653
|
|
|
|
|
|
|
|
|
|
|
Income tax expense (benefit)
|
|
W
|
(46,793
|
)
|
|
|
178,623
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Deferred Tax Assets and Liabilities
|
Deferred tax assets are reviewed at each reporting date
and are reduced to the extent that it is no longer probable that the deferred tax assets at the reporting date will be realized with the Groups estimated future taxable income.
Deferred tax assets and liabilities as of March 31, 2018 and December 31, 2017 are attributable to the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Assets
|
|
|
Liabilities
|
|
|
Total
|
|
|
|
March, 31,
2018
|
|
|
December, 31,
2017
|
|
|
March, 31,
2018
|
|
|
December, 31,
2017
|
|
|
March, 31,
2018
|
|
|
December, 31,
2017
|
|
Other accounts receivable, net
|
|
W
|
|
|
|
|
|
|
|
|
(827
|
)
|
|
|
(1,441
|
)
|
|
|
(827
|
)
|
|
|
(1,441
|
)
|
Inventories, net
|
|
|
36,822
|
|
|
|
34,550
|
|
|
|
|
|
|
|
|
|
|
|
36,822
|
|
|
|
34,550
|
|
Defined benefit liabilities, net
|
|
|
18,232
|
|
|
|
2,375
|
|
|
|
|
|
|
|
|
|
|
|
18,232
|
|
|
|
2,375
|
|
Investments in subsidiaries and associates
|
|
|
21,389
|
|
|
|
29,061
|
|
|
|
|
|
|
|
|
|
|
|
21,389
|
|
|
|
29,061
|
|
Accrued expenses
|
|
|
110,888
|
|
|
|
183,903
|
|
|
|
|
|
|
|
|
|
|
|
110,888
|
|
|
|
183,903
|
|
Property, plant and equipment
|
|
|
410,560
|
|
|
|
409,928
|
|
|
|
|
|
|
|
|
|
|
|
410,560
|
|
|
|
409,928
|
|
Intangible assets
|
|
|
3,251
|
|
|
|
3,457
|
|
|
|
(23,656
|
)
|
|
|
(24,646
|
)
|
|
|
(20,405
|
)
|
|
|
(21,189
|
)
|
Provisions
|
|
|
23,371
|
|
|
|
27,018
|
|
|
|
|
|
|
|
|
|
|
|
23,371
|
|
|
|
27,018
|
|
Gain or loss on foreign currency translation, net
|
|
|
13
|
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
13
|
|
|
|
13
|
|
Others
|
|
|
25,581
|
|
|
|
27,562
|
|
|
|
|
|
|
|
|
|
|
|
25,581
|
|
|
|
27,562
|
|
Tax losses
|
|
|
110,880
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
110,880
|
|
|
|
|
|
Tax credit carryforwards
|
|
|
322,674
|
|
|
|
268,926
|
|
|
|
|
|
|
|
|
|
|
|
322,674
|
|
|
|
268,926
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax assets (liabilities)
|
|
W
|
1,083,661
|
|
|
|
986,793
|
|
|
|
(24,483
|
)
|
|
|
(26,087
|
)
|
|
|
1,059,178
|
|
|
|
960,706
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
69
23.
|
Income Taxes, Continued
|
|
(b)
|
Deferred Tax Assets and Liabilities, Continued
|
Statutory tax rate applicable to the
Controlling Company was 24.2% for the year ended December 31, 2017. During the year ended December 31, 2017, certain amendments to corporate income tax rules in Korea were enacted and effective on January 1, 2018 that resulted in application of
27.5% for taxable income in excess of
W
300,000 million. Deferred taxes as of December 31, 2017 and March 31, 2018 have been measured using the applicable tax rates from the amendment.
24.
|
Earnings (loss) Per Share
|
|
(a)
|
Basic earnings (loss) per share for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In won and No. of shares)
|
|
2018
|
|
|
2017
|
|
Profit (loss) attributable to owners of the Controlling Company
|
|
W
|
(59,453,887,501
|
)
|
|
|
633,489,694,225
|
|
Weighted-average number of common stocks outstanding
|
|
|
357,815,700
|
|
|
|
357,815,700
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share
|
|
W
|
(166
|
)
|
|
|
1,770
|
|
|
|
|
|
|
|
|
|
|
For the three-month periods ended March 31, 2018 and 2017, there were no events or transactions that
resulted in changes in the number of common stocks used for calculating earnings (loss) per share.
|
(b)
|
Diluted earnings (loss) per share for the three-month periods ended March 31, 2018 and 2017 are not calculated since there was no potential common stock.
|
25.
|
Financial Risk Management
|
The Group is exposed to credit risk, liquidity risk and
market risks. The Group identifies and analyzes such risks, and controls are implemented under a risk management system to monitor and manage these risks at below a threshold level.
Market risk is the risk that changes in market prices, such as foreign exchange
rates, interest rates and equity prices, will affect the Groups income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters,
while optimizing the return.
The Group is exposed to currency risk on sales, purchases and borrowings that
are denominated in a currency other than the functional currency of the Group, Korean won (KRW). The currencies in which these transactions primarily are denominated are USD, CNY, JPY, etc.
70
25.
|
Financial Risk Management, Continued
|
|
(i)
|
Currency risk, Continued
|
Interest on borrowings is denominated in the currency of the
borrowing. Generally, borrowings are denominated in currencies that match the cash flows generated by the underlying operations of the Group, primarily KRW and USD.
In respect of other monetary assets and liabilities denominated in foreign currencies, the Group adopts policies to ensure that its net
exposure is kept to an acceptable level by buying or selling foreign currencies at spot rates when necessary to address short-term imbalances.
i) Exposure to currency risk
The Groups exposure to foreign currency risk based on notional amounts as of March 31, 2018 and December 31, 2017 is as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
|
March 31, 2018
|
|
|
|
USD
|
|
|
JPY
|
|
|
CNY
|
|
|
TWD
|
|
|
EUR
|
|
|
PLN
|
|
|
VND
|
|
Cash and cash equivalents
|
|
|
347
|
|
|
|
697
|
|
|
|
7,892
|
|
|
|
85
|
|
|
|
2
|
|
|
|
170
|
|
|
|
2,054,324
|
|
Deposits in banks
|
|
|
|
|
|
|
|
|
|
|
2,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts and notes receivable
|
|
|
2,726
|
|
|
|
8
|
|
|
|
1,138
|
|
|
|
|
|
|
|
|
|
|
|
10
|
|
|
|
|
|
Non-trade
receivable
|
|
|
101
|
|
|
|
791
|
|
|
|
3,412
|
|
|
|
3
|
|
|
|
2
|
|
|
|
|
|
|
|
3,291
|
|
Other assets denominated in foreign currencies
|
|
|
64
|
|
|
|
1,147
|
|
|
|
1,314
|
|
|
|
588
|
|
|
|
|
|
|
|
46
|
|
|
|
2,673
|
|
Trade accounts and notes payable
|
|
|
(1,076
|
)
|
|
|
(13,168
|
)
|
|
|
(2,626
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(93,646
|
)
|
Other accounts payable
|
|
|
(605
|
)
|
|
|
(15,269
|
)
|
|
|
(1,831
|
)
|
|
|
(5
|
)
|
|
|
(8
|
)
|
|
|
(3
|
)
|
|
|
(1,336,576
|
)
|
Debt
|
|
|
(1,600
|
)
|
|
|
|
|
|
|
(3,263
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net exposure
|
|
|
(43
|
)
|
|
|
(25,794
|
)
|
|
|
8,936
|
|
|
|
671
|
|
|
|
(4
|
)
|
|
|
223
|
|
|
|
630,066
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
71
25.
|
Financial Risk Management, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
|
December 31, 2017
|
|
|
|
USD
|
|
|
JPY
|
|
|
CNY
|
|
|
TWD
|
|
|
EUR
|
|
|
PLN
|
|
|
VND
|
|
Cash and cash equivalents
|
|
|
1,228
|
|
|
|
152
|
|
|
|
6,940
|
|
|
|
16
|
|
|
|
3
|
|
|
|
165
|
|
|
|
342,063
|
|
Deposits in banks
|
|
|
|
|
|
|
|
|
|
|
750
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts and notes receivable
|
|
|
3,316
|
|
|
|
11
|
|
|
|
1,453
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-trade
receivable
|
|
|
62
|
|
|
|
1,340
|
|
|
|
136
|
|
|
|
2
|
|
|
|
9
|
|
|
|
|
|
|
|
13,405
|
|
Other assets denominated in foreign currencies
|
|
|
1
|
|
|
|
206
|
|
|
|
596
|
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
1,882
|
|
Trade accounts and notes payable
|
|
|
(1,345
|
)
|
|
|
(14,898
|
)
|
|
|
(2,843
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(102,398
|
)
|
Other accounts payable
|
|
|
(285
|
)
|
|
|
(14,653
|
)
|
|
|
(2,403
|
)
|
|
|
(11
|
)
|
|
|
(8
|
)
|
|
|
(4
|
)
|
|
|
(2,138,370
|
)
|
Debt
|
|
|
(1,500
|
)
|
|
|
|
|
|
|
(3,263
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net exposure
|
|
|
1,477
|
|
|
|
(27,842
|
)
|
|
|
1,366
|
|
|
|
14
|
|
|
|
4
|
|
|
|
161
|
|
|
|
(1,883,418
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average exchange rates applied for the three-month periods ended March 31, 2018 and 2017 and the exchange
rates at March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In won)
|
|
Average rate
|
|
|
Reporting date spot rate
|
|
|
|
2018
|
|
|
2017
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
USD
|
|
W
|
1,072.66
|
|
|
|
1,154.65
|
|
|
|
1,066.50
|
|
|
|
1,071.40
|
|
JPY
|
|
|
9.90
|
|
|
|
10.15
|
|
|
|
10.01
|
|
|
|
9.49
|
|
CNY
|
|
|
168.62
|
|
|
|
168.15
|
|
|
|
169.68
|
|
|
|
163.65
|
|
TWD
|
|
|
36.59
|
|
|
|
37.11
|
|
|
|
36.63
|
|
|
|
35.92
|
|
EUR
|
|
|
1,317.33
|
|
|
|
1,230.16
|
|
|
|
1,311.95
|
|
|
|
1,279.25
|
|
PLN
|
|
|
315.20
|
|
|
|
284.48
|
|
|
|
311.79
|
|
|
|
306.07
|
|
VND
|
|
|
0.0472
|
|
|
|
0.0508
|
|
|
|
0.0468
|
|
|
|
0.0472
|
|
72
25.
|
Financial Risk Management, Continued
|
A weaker won, as indicated below, against the following currencies
which comprise the Groups assets or liabilities denominated in a foreign currency as of March 31, 2018 and 2017, would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis is based on foreign
currency exchange rate variances that the Group considers to be reasonably possible as of the end of the reporting period. The analysis assumes that all other variables, in particular interest rates, would remain constant. The changes in equity and
profit or loss would have been as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
|
Equity
|
|
|
Profit
or loss
|
|
|
Equity
|
|
|
Profit
or loss
|
|
USD (5 percent weakening)
|
|
W
|
(15,765
|
)
|
|
|
35,538
|
|
|
|
50,040
|
|
|
|
91,238
|
|
JPY (5 percent weakening)
|
|
|
(9,678
|
)
|
|
|
(8,535
|
)
|
|
|
(10,294
|
)
|
|
|
(9,141
|
)
|
CNY (5 percent weakening)
|
|
|
64,386
|
|
|
|
30,140
|
|
|
|
13,212
|
|
|
|
(6,396
|
)
|
TWD (5 percent weakening)
|
|
|
1,229
|
|
|
|
|
|
|
|
23
|
|
|
|
1
|
|
EUR (5 percent weakening)
|
|
|
(272
|
)
|
|
|
(47
|
)
|
|
|
16
|
|
|
|
594
|
|
PLN (5 percent weakening)
|
|
|
3,500
|
|
|
|
(74
|
)
|
|
|
2,515
|
|
|
|
(120
|
)
|
VND (5 percent weakening)
|
|
|
1,474
|
|
|
|
|
|
|
|
(4,445
|
)
|
|
|
|
|
A stronger won against the above currencies as of March 31, 2018 and December 31, 2017 would have had
the equal but opposite effect on the above currencies to the amounts shown above, on the basis that all other variables remain constant.
Interest rate risk arises principally from the Groups debentures and
borrowings. The Group establishes and applies its policy to reduce uncertainty arising from fluctuations in the interest rate and to minimize finance cost and manages interest rate risk by monitoring of trends of fluctuations in interest rate and
establishing plan for countermeasures.
The interest rate profile of the Groups interest-bearing financial instruments
as of March 31, 2018 and December 31, 2017 is as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Fixed rate instruments
|
|
|
|
|
|
|
|
|
Financial assets
|
|
W
|
3,497,125
|
|
|
|
3,360,800
|
|
Financial liabilities
|
|
|
(3,971,512
|
)
|
|
|
(2,962,671
|
)
|
|
|
|
|
|
|
|
|
|
|
|
W
|
(474,387
|
)
|
|
|
398,129
|
|
|
|
|
|
|
|
|
|
|
Variable rate instruments
|
|
|
|
|
|
|
|
|
Financial liabilities
|
|
W
|
(2,760,178
|
)
|
|
|
(2,640,447
|
)
|
73
25.
|
Financial Risk Management, Continued
|
|
ii)
|
Equity and profit or loss sensitivity analysis for variable rate instruments
|
As of
March 31, 2018 and December 31, 2017, a change of 100 basis points in interest rates at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below for each
12-month
period following the reporting dates. This analysis assumes that all other variables, in particular foreign currency rates, remain constant.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Equity
|
|
|
Profit or loss
|
|
|
|
1%p
increase
|
|
|
1%p
decrease
|
|
|
1%p
increase
|
|
|
1%p
decrease
|
|
March 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable rate instruments(*)
|
|
W
|
(17,474
|
)
|
|
|
17,474
|
|
|
|
(17,474
|
)
|
|
|
17,474
|
|
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable rate instruments(*)
|
|
W
|
(17,362
|
)
|
|
|
17,362
|
|
|
|
(17,362
|
)
|
|
|
17,362
|
|
|
(*)
|
Financial instruments subject to interest rate swap not qualified for hedging are excluded.
|
Credit risk is the risk of financial loss to the Group if a customer or
counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Groups receivables from customers.
The Groups exposure to credit risk of trade and other receivables is influenced mainly by the individual characteristics of each
customer. However, management believes that the demographics of the Groups customer base, including the default risk of the country in which customers operate, do not have a significant influence on credit risk since the majority of the
customers are global electronic appliance manufacturers operating in global markets.
The Group establishes credit limits for each customer
and each new customer is analyzed quantitatively and qualitatively before determining whether to utilize third party guarantees, insurance or factoring as appropriate.
In relation to the impairment of financial assets, the Group recognizes expected credit loss and its changes at each reporting date subsequent
to initial recognition of financial asset according to an expected credit loss impairment model.
The Group does not establish allowances
for receivables under insurance or receivables from customers with a high credit rating. Trade accounts and notes receivables are insured in order to manage credit risk and uninsured trade accounts and notes receivables are managed in accordance
with the Groups management policy.
The carrying amount of financial assets represents the maximum credit exposure. The maximum
exposure to credit risk as of March 31, 2018 and December 31, 2017 are as follows:
74
25.
|
Financial Risk Management, Continued
|
|
(b)
|
Credit risk, Continued
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
March 31, 2018
|
|
|
|
Carrying amounts
|
|
Financial Assets Carried at Amortized Cost
|
|
|
|
|
Cash and cash equivalents
|
|
W
|
2,626,689
|
|
Deposits in banks
|
|
|
870,283
|
|
Trade accounts and notes receivable
|
|
|
3,496,163
|
|
Non-trade
receivable
|
|
|
112,335
|
|
Accrued income
|
|
|
14,034
|
|
Deposits
|
|
|
22,415
|
|
Short-term loans
|
|
|
15,094
|
|
Long-term
loans
|
|
|
37,297
|
|
Long-term
non-trade
receivable
|
|
|
183
|
|
|
|
|
|
|
Sub-Total
|
|
W
|
7,194,493
|
|
Financial Assets at Fair Value through Profit or Loss
|
|
|
|
|
Convertible bonds
|
|
W
|
1,552
|
|
Derivatives
|
|
|
600
|
|
|
|
|
|
|
Sub-Total
|
|
W
|
2,152
|
|
Financial Assets at Fair Value through Other Comprehensive Income
|
|
|
|
|
Debt instrument
|
|
W
|
163
|
|
|
|
|
|
|
Total
|
|
W
|
7,196,808
|
|
|
|
|
|
|
75
25.
|
Financial Risk Management, Continued
|
|
i)
|
As of December 31, 2017
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
December 31, 2017
|
|
|
|
Carrying amounts
|
|
Cash and cash equivalents
|
|
W
|
2,602,560
|
|
Deposits in banks
|
|
|
758,089
|
|
Trade accounts and notes receivable
|
|
|
4,325,120
|
|
Non-trade
receivable
|
|
|
150,554
|
|
Accrued income
|
|
|
14,273
|
|
Available-for-sale
financial assets
|
|
|
162
|
|
Financial assets at fair value through profit or loss
|
|
|
1,552
|
|
Deposits
|
|
|
30,378
|
|
Short-term loans
|
|
|
16,766
|
|
Long-term
loans
|
|
|
32,408
|
|
Long-term
non-trade
receivable
|
|
|
8,738
|
|
Derivatives
|
|
|
842
|
|
|
|
|
|
|
Total
|
|
W
|
7,941,442
|
|
|
|
|
|
|
76
25.
|
Financial Risk Management, Continued
|
Liquidity risk is the risk that the Group will encounter difficulty in meeting
the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Groups approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity
to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Groups reputation.
The Group has historically been able to satisfy its cash requirements from cash flows from operations and debt and equity financing. To the
extent that the Group does not generate sufficient cash flows from operations to meet its capital requirements, the Group may rely on other financing activities, such as external long-term borrowings and offerings of debt instruments, equity-linked
and other debt instruments. In addition, the Group maintains a line of credit with various banks.
The following are the contractual
maturities of financial liabilities, including estimated interest payments, as of March 31, 2018.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
Contractual cash flows
|
|
|
|
Carrying
amount
|
|
|
Total
|
|
|
6 months
or less
|
|
|
6-12
months
|
|
|
1-2 years
|
|
|
2-5
years
|
|
|
More than
5 years
|
|
Non-derivative
financial liabilities :
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Secured bank borrowings
|
|
W
|
653,307
|
|
|
|
665,734
|
|
|
|
295,300
|
|
|
|
370,434
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unsecured bank borrowings
|
|
|
3,858,617
|
|
|
|
4,125,262
|
|
|
|
375,091
|
|
|
|
897,570
|
|
|
|
546,001
|
|
|
|
2,174,856
|
|
|
|
131,744
|
|
Unsecured bond issues
|
|
|
2,219,766
|
|
|
|
2,365,526
|
|
|
|
236,301
|
|
|
|
139,176
|
|
|
|
599,441
|
|
|
|
1,390,608
|
|
|
|
|
|
Trade accounts and notes payable
|
|
|
2,802,837
|
|
|
|
2,802,837
|
|
|
|
2,802,837
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other accounts payable
|
|
|
3,273,185
|
|
|
|
3,273,185
|
|
|
|
3,273,185
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term other accounts payable
|
|
|
2
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
Security deposits
|
|
|
5,775
|
|
|
|
5,775
|
|
|
|
3,145
|
|
|
|
85
|
|
|
|
2,545
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
12,813,489
|
|
|
|
13,238,321
|
|
|
|
6,985,859
|
|
|
|
1,407,265
|
|
|
|
1,147,989
|
|
|
|
3,565,464
|
|
|
|
131,744
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or
at significantly different amounts.
77
25.
|
Financial Risk Management, Continued
|
Managements policy is to maintain a capital base so as to maintain
investor, creditor and market confidence and to sustain future development of the business. Liabilities to equity ratio, net borrowings to equity ratio and other financial ratios are used by management to achieve an optimal capital structure.
Management also monitors the return on capital as well as the level of dividends to ordinary shareholders.
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Total liabilities
|
|
W
|
15,169,635
|
|
|
|
14,178,177
|
|
Total equity
|
|
|
14,825,636
|
|
|
|
14,981,510
|
|
Cash and deposits in banks (*1)
|
|
|
3,496,961
|
|
|
|
3,360,638
|
|
Borrowings (including bonds)
|
|
|
6,731,690
|
|
|
|
5,603,118
|
|
Total liabilities to equity ratio
|
|
|
102
|
%
|
|
|
95
|
%
|
Net borrowings to equity ratio (*2)
|
|
|
22
|
%
|
|
|
15
|
%
|
(*1)
|
Cash and deposits in banks consist of cash and cash equivalents and current deposits in banks.
|
(*2)
|
Net borrowings to equity ratio is calculated by dividing total borrowings (including bonds) less cash and current deposits in banks by total equity.
|
78
25.
|
Financial Risk Management, Continued
|
|
(e)
|
Determination of fair value
|
|
(i)
|
Measurement of fair value
|
A number of the Groups accounting policies and disclosures
require the determination of fair value, for both financial and
non-financial
assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods.
When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.
|
i)
|
Current Assets and Liabilities
|
The carrying amounts approximate fair value because of the
short maturity of these instruments.
|
ii)
|
Trade Receivables and Other Receivables
|
The fair value of trade and other receivables is
estimated as the present value of future cash flows, discounted at the market rate of interest at the reporting date. This fair value is determined for disclosure purposes. The carrying amounts of short-term receivables approximate fair value.
|
iii)
|
Investments in Equity and Debt Instruments
|
Marketable financial assets at fair value through
profit or loss and at fair value through other comprehensive income is determined by reference to their quoted closing bid price at the reporting date. The fair value of
non-marketable
instruments is
determined using valuation methods.
|
iv)
|
Non-derivative
Financial Liabilities
|
Fair value, which
is determined for disclosure purposes, except for the liabilities at FVTPL, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date.
79
25.
|
Financial Risk Management, Continued
|
|
(ii)
|
Fair values versus carrying amounts
|
The fair values of financial assets and liabilities,
together with the carrying amounts shown in the condensed consolidated interim statements of financial position, are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
|
Carrying amounts
|
|
|
Fair Values
|
|
Financial Assets carried at amortized cost
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
W
|
2,626,689
|
|
|
|
(*)
|
|
Deposits in banks
|
|
|
870,283
|
|
|
|
(*)
|
|
Trade accounts and notes receivable
|
|
|
3,496,163
|
|
|
|
(*)
|
|
Non-trade
receivable
|
|
|
112,335
|
|
|
|
(*)
|
|
Accrued income
|
|
|
14,034
|
|
|
|
(*)
|
|
Deposits
|
|
|
22,414
|
|
|
|
(*)
|
|
Short-term loans
|
|
|
15,094
|
|
|
|
(*)
|
|
Long-term
loans
|
|
|
37,297
|
|
|
|
(*)
|
|
Long-term
non-trade
receivable
|
|
|
183
|
|
|
|
(*)
|
|
Financial Assets at Fair Value through Profit or Loss
|
|
|
|
|
|
|
|
|
Equity instrument
|
|
W
|
5,008
|
|
|
|
5,008
|
|
Convertible bonds
|
|
|
1,552
|
|
|
|
1,552
|
|
Derivatives
|
|
|
600
|
|
|
|
600
|
|
Financial Assets at Fair Value through Other Comprehensive Income
|
|
|
|
|
|
|
|
|
Debt instrument
|
|
W
|
163
|
|
|
|
163
|
|
Liabilities carried at amortized cost
|
|
|
|
|
|
|
|
|
Secured bank borrowings
|
|
W
|
653,307
|
|
|
|
653,307
|
|
Unsecured bank borrowings
|
|
|
3,858,617
|
|
|
|
3,869,834
|
|
Unsecured bond issues
|
|
|
2,219,766
|
|
|
|
2,225,927
|
|
Trade accounts and notes payable
|
|
|
2,802,837
|
|
|
|
(*)
|
|
Other accounts payable
|
|
|
3,273,185
|
|
|
|
3,273,318
|
|
Long-term other accounts payable
|
|
|
2
|
|
|
|
(*)
|
|
Security deposits
|
|
|
5,775
|
|
|
|
(*)
|
|
80
25.
|
Financial Risk Management, Continued
|
|
i)
|
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
December 31, 2017
|
|
|
|
Carrying amounts
|
|
|
Fair Values
|
|
Assets carried at fair value
|
|
|
|
|
|
|
|
|
Available-for-sale
financial assets
|
|
W
|
162
|
|
|
|
162
|
|
Financial asset at fair value through profit or loss
|
|
|
1,552
|
|
|
|
1,552
|
|
Derivatives
|
|
|
842
|
|
|
|
842
|
|
Assets carried at amortized cost
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
W
|
2,602,560
|
|
|
|
(*)
|
|
Deposits in banks
|
|
|
758,089
|
|
|
|
(*)
|
|
Trade accounts and notes receivable
|
|
|
4,325,120
|
|
|
|
(*)
|
|
Non-trade
receivable
|
|
|
150,554
|
|
|
|
(*)
|
|
Accrued income
|
|
|
14,273
|
|
|
|
(*)
|
|
Deposits
|
|
|
30,378
|
|
|
|
(*)
|
|
Short-term loans
|
|
|
16,766
|
|
|
|
(*)
|
|
Long-term
loans
|
|
|
32,408
|
|
|
|
(*)
|
|
Long-term
non-trade
receivable
|
|
|
8,738
|
|
|
|
(*)
|
|
Liabilities carried at amortized cost
|
|
|
|
|
|
|
|
|
Secured bank borrowings
|
|
W
|
642,172
|
|
|
|
642,172
|
|
Unsecured bank borrowings
|
|
|
2,950,184
|
|
|
|
2,955,399
|
|
Unsecured bond issues
|
|
|
2,010,762
|
|
|
|
2,016,086
|
|
Trade accounts and notes payable
|
|
|
2,875,090
|
|
|
|
(*)
|
|
Other accounts payable
|
|
|
3,169,937
|
|
|
|
3,170,147
|
|
Long-term other accounts payable
|
|
|
2
|
|
|
|
(*)
|
|
(*)
|
Excluded from disclosures as the carrying amount approximates fair value.
|
81
25.
|
Financial Risk Management, Continued
|
|
(iii)
|
Fair values of financial assets and liabilities
|
The table below analyzes financial instruments carried at fair value
based on the input variables used in the valuation method to measure fair value of assets and liabilities. The different levels have been defined as follows:
|
|
|
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
|
|
|
|
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly
|
|
|
|
Level 3: inputs for the asset or liability that are not based on observable market data
|
|
ii)
|
Financial instruments measured at fair value
|
Fair value hierarchy classifications of the
financial instruments that are measured at fair value as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
March 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Asset at Fair Value through Profit or Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity instrument
|
|
W
|
|
|
|
|
|
|
|
|
5,008
|
|
|
|
5,008
|
|
Convertible bonds
|
|
|
|
|
|
|
|
|
|
|
1,552
|
|
|
|
1,552
|
|
Derivatives
|
|
|
|
|
|
|
|
|
|
|
600
|
|
|
|
600
|
|
Financial Asset at Fair Value through Other Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt instrument
|
|
W
|
163
|
|
|
|
|
|
|
|
|
|
|
|
163
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale
financial assets
|
|
W
|
162
|
|
|
|
|
|
|
|
|
|
|
|
162
|
|
Financial assets at fair value through profit or loss
|
|
|
|
|
|
|
|
|
|
|
1,552
|
|
|
|
1,552
|
|
Derivatives
|
|
|
|
|
|
|
|
|
|
|
842
|
|
|
|
842
|
|
82
25.
|
Financial Risk Management, Continued
|
|
iii)
|
Financial instruments not measured at fair value but for which the fair value is disclosed
|
Fair value hierarchy classifications, valuation technique and inputs for fair value measurements of the financial instruments not measured at
fair value but for which the fair value is disclosed as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
March 31, 2018
|
|
|
Valuation
technique
|
|
|
Input
|
|
Classification
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Secured bank borrowings
|
|
W
|
|
|
|
|
|
|
|
|
653,307
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Unsecured bank borrowings
|
|
|
|
|
|
|
|
|
|
|
3,869,834
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Unsecured bond issues
|
|
|
|
|
|
|
|
|
|
|
2,225,927
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Other accounts payable
|
|
|
|
|
|
|
|
|
|
|
3,273,318
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Long-term other accounts payable
|
|
|
|
|
|
|
|
|
|
|
2
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
|
|
|
|
(
In millions of won
)
|
|
December 31, 2017
|
|
|
Valuation
technique
|
|
|
Input
|
|
Classification
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Secured bank borrowings
|
|
W
|
|
|
|
|
|
|
|
|
642,172
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Unsecured bank borrowings
|
|
|
|
|
|
|
|
|
|
|
2,955,399
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Unsecured bond issues
|
|
|
|
|
|
|
|
|
|
|
2,016,086
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Other accounts payable
|
|
|
|
|
|
|
|
|
|
|
3,170,147
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Long-term other accounts payable
|
|
|
|
|
|
|
|
|
|
|
2
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
|
iv)
|
The interest rates applied for determination of the above fair value as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
Debentures, loans and others
|
|
1.52~2.95%
|
|
1.57~2.92%
|
83
26.
|
Changes in liabilities arising from financing activities
|
Changes in liabilities arising from financing activities for the three-month period ended March 31, 2018
are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
Non-cash
transactions
|
|
|
|
|
|
|
January 1,
2018
|
|
|
Cash flows from
financing
activities
|
|
|
Dividends
declared
|
|
|
Reclassification
|
|
|
Gain or loss on
foreign currency
translation
|
|
|
Others
|
|
|
March 31,
2018
|
|
Current portion of long-term borrowings and bonds
|
|
W
|
1,452,926
|
|
|
|
(180,168
|
)
|
|
|
|
|
|
|
867,790
|
|
|
|
7,327
|
|
|
|
141
|
|
|
|
2,148,016
|
|
Long-term borrowings
|
|
|
2,644,189
|
|
|
|
907,850
|
|
|
|
|
|
|
|
(867,790
|
)
|
|
|
4,561
|
|
|
|
|
|
|
|
2,688,810
|
|
Bonds
|
|
|
1,506,003
|
|
|
|
388,447
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
414
|
|
|
|
1,894,864
|
|
Dividends payable
|
|
|
|
|
|
|
|
|
|
|
232,014
|
|
|
|
|
|
|
|
(406
|
)
|
|
|
|
|
|
|
231,608
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
5,603,118
|
|
|
|
1,116,129
|
|
|
|
232,014
|
|
|
|
|
|
|
|
11,482
|
|
|
|
555
|
|
|
|
6,963,298
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
84
27.
|
Related Parties and Others
|
Related parties as of March 31, 2018 are as follows:
|
|
|
Classification
|
|
Description
|
Associates(*)
|
|
Paju Electric Glass Co., Ltd. and others
|
|
|
Subsidiaries of Associates
|
|
AVATEC Electronics Yantai Co., Ltd. and others
|
|
|
Entity that has significant influence over the Controlling Company
|
|
LG Electronics Inc.
|
|
|
Subsidiaries of the entity that has significant influence over the Controlling Company
|
|
Subsidiaries of LG Electronics Inc.
|
(*)
|
Details of associates are described in note 8.
|
85
27.
|
Related Parties and Others, Continued
|
|
(b)
|
Significant transactions such as sales of goods and purchases of raw material and outsourcing service and others, which occurred in the normal course of business with related parties for the three-month periods ended
March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
2018
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property, plant
and equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
Associates and their subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INVENIA Co., Ltd.
|
|
|
|
|
|
|
30
|
|
|
|
270
|
|
|
|
7,902
|
|
|
|
|
|
|
|
72
|
|
AVATEC Co., Ltd.
|
|
|
|
|
|
|
530
|
|
|
|
|
|
|
|
|
|
|
|
17,773
|
|
|
|
119
|
|
Paju Electric Glass Co., Ltd.
|
|
|
|
|
|
|
4,172
|
|
|
|
92,497
|
|
|
|
|
|
|
|
|
|
|
|
920
|
|
WooRee E&L Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
47
|
|
YAS Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
760
|
|
|
|
12,417
|
|
|
|
|
|
|
|
794
|
|
LB Gemini New Growth Fund No. 16
|
|
|
|
|
|
|
540
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
|
|
|
|
5,272
|
|
|
|
93,527
|
|
|
|
20,319
|
|
|
|
17,773
|
|
|
|
1,952
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entity that has significant influence over the Controlling Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics Inc.
|
|
W
|
363,699
|
|
|
|
|
|
|
|
11,113
|
|
|
|
221,371
|
|
|
|
|
|
|
|
19,114
|
|
Subsidiaries of the entity that has significant influence over the Controlling
Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics India Pvt. Ltd.
|
|
W
|
8,355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13
|
|
LG Electronics Vietnam Haiphong Co., Ltd.
|
|
|
32,988
|
|
|
|
|
|
|
|
|
|
|
|
1,214
|
|
|
|
|
|
|
|
2
|
|
LG Electronics Nanjing New Technology Co., Ltd.
|
|
|
71,483
|
|
|
|
|
|
|
|
|
|
|
|
18
|
|
|
|
|
|
|
|
125
|
|
86
27.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
2018
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property, plant
and equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
LG Electronics RUS, LLC
|
|
W
|
15,328
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
320
|
|
LG Electronics do Brasil Ltda.
|
|
|
86,005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
104
|
|
LG Innotek Co., Ltd.
|
|
|
6,950
|
|
|
|
|
|
|
|
39,616
|
|
|
|
|
|
|
|
|
|
|
|
11,082
|
|
Qingdao LG Inspur Digital Communication Co., Ltd.
|
|
|
7,656
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inspur LG Digital Mobile Communications Co., Ltd.
|
|
|
33,987
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics Mexicalli S.A. DE C.V.
|
|
|
55,028
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
54
|
|
LG Electronics Mlawa Sp. z o.o.
|
|
|
172,622
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
72
|
|
LG Hitachi Water Solutions Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
119,537
|
|
|
|
|
|
|
|
491
|
|
LG Electronics Reynosa S.A. DE C.V.
|
|
|
246,928
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
898
|
|
HiEntech Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,230
|
|
|
|
|
|
|
|
7,935
|
|
HiEntech (Tianjin) Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,541
|
|
|
|
|
|
|
|
10,243
|
|
Others
|
|
|
8,537
|
|
|
|
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
2,867
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
745,867
|
|
|
|
|
|
|
|
39,622
|
|
|
|
133,540
|
|
|
|
|
|
|
|
34,206
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,109,566
|
|
|
|
5,272
|
|
|
|
144,262
|
|
|
|
375,230
|
|
|
|
17,773
|
|
|
|
55,272
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
87
27.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
2017
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property, plant
and equipment
|
|
|
Outsourcing
fees
|
|
|
Other
costs
|
|
Associates and their subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New Optics Ltd.(*)
|
|
W
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
6
|
|
INVENIA Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
454
|
|
|
|
20,090
|
|
|
|
|
|
|
|
113
|
|
AVACO Co., Ltd.(*)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
66
|
|
AVATEC Co., Ltd.
|
|
|
|
|
|
|
530
|
|
|
|
|
|
|
|
|
|
|
|
19,816
|
|
|
|
251
|
|
Paju Electric Glass Co., Ltd.
|
|
|
|
|
|
|
8,109
|
|
|
|
98,763
|
|
|
|
|
|
|
|
|
|
|
|
1,097
|
|
Shinbo Electric Co., Ltd.(*)
|
|
|
15,812
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21
|
|
Narenanotech Corporation(*)
|
|
|
|
|
|
|
|
|
|
|
226
|
|
|
|
16,875
|
|
|
|
|
|
|
|
225
|
|
WooRee E&L Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
76
|
|
YAS Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
830
|
|
|
|
19,208
|
|
|
|
|
|
|
|
392
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
15,813
|
|
|
|
8,639
|
|
|
|
100,273
|
|
|
|
56,173
|
|
|
|
19,820
|
|
|
|
2,247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entity that has significant influence over the Controlling Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics Inc.
|
|
W
|
476,921
|
|
|
|
|
|
|
|
7,485
|
|
|
|
231,879
|
|
|
|
|
|
|
|
35,053
|
|
Subsidiaries of the entity that has significant influence over the Controlling
Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Innotek Co., Ltd.
|
|
W
|
4,274
|
|
|
|
|
|
|
|
45,295
|
|
|
|
|
|
|
|
|
|
|
|
3,480
|
|
LG Hitachi Water Solutions Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27,619
|
|
|
|
|
|
|
|
3,495
|
|
88
27.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
2017
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property, plant
and equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
HiEntech Co., Ltd.
|
|
W
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,511
|
|
HiEntech (Tianjin) Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,682
|
|
|
|
|
|
|
|
6,600
|
|
Qingdao LG Inspur Digital Communication Co., Ltd.
|
|
|
15,963
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inspur LG Digital Mobile Communications Co., Ltd.
|
|
|
71,964
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics India Pvt. Ltd.
|
|
|
22,276
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29
|
|
LG Electronics Vietnam Haiphong Co., Ltd.
|
|
|
52,956
|
|
|
|
|
|
|
|
|
|
|
|
343
|
|
|
|
|
|
|
|
4,563
|
|
LG Electronics Nanjing New Technology Co., Ltd.
|
|
|
76,894
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
107
|
|
LG Electronics RUS, LLC
|
|
|
28,975
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
286
|
|
LG Electronics do Brasil Ltda.
|
|
|
62,616
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
91
|
|
LG Electronics Mexicalli S.A. DE C.V.
|
|
|
77,450
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
51
|
|
LG Electronics Mlawa Sp. z o.o.
|
|
|
290,737
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
302
|
|
LG Electronics Taiwan Taipei Co., Ltd.
|
|
|
3,598
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23
|
|
LG Electronics Reynosa S.A. DE C.V.
|
|
|
304,510
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
325
|
|
LG Electronics Almaty Kazakhstan
|
|
|
4,043
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics S.A. (Pty) Ltd.
|
|
|
5,182
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3
|
|
Others
|
|
|
898
|
|
|
|
|
|
|
|
|
|
|
|
509
|
|
|
|
|
|
|
|
1,666
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,022,336
|
|
|
|
|
|
|
|
45,295
|
|
|
|
33,153
|
|
|
|
|
|
|
|
33,532
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,515,070
|
|
|
|
8,639
|
|
|
|
153,053
|
|
|
|
321,205
|
|
|
|
19,820
|
|
|
|
70,832
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Represents transactions occurred prior to disposal of the entire investments.
|
89
27.
|
Related Parties and Others, Continued
|
|
(c)
|
Trade accounts and notes receivable and payable as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
Trade accounts and notes receivable
and others
|
|
|
Trade accounts and notes payable
and others
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Associates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INVENIA Co., Ltd.
|
|
W
|
2,280
|
|
|
|
2,375
|
|
|
|
8,972
|
|
|
|
18,662
|
|
AVATEC Co., Ltd.
|
|
|
530
|
|
|
|
|
|
|
|
4,682
|
|
|
|
2,949
|
|
Paju Electric Glass Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
64,375
|
|
|
|
60,141
|
|
WooRee E&L Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
52
|
|
|
|
61
|
|
YAS Co., Ltd.
|
|
|
250
|
|
|
|
375
|
|
|
|
16,700
|
|
|
|
6,474
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,060
|
|
|
|
2,750
|
|
|
|
94,781
|
|
|
|
88,287
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entity that has significant influence over the Controlling Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics Inc.
|
|
W
|
401,787
|
|
|
|
550,335
|
|
|
|
271,079
|
|
|
|
257,071
|
|
Subsidiaries of the entity that has significant influence over the Controlling
Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics India Pvt. Ltd.
|
|
W
|
5,751
|
|
|
|
3,030
|
|
|
|
5
|
|
|
|
|
|
LG Electronics Vietnam Haiphong Co., Ltd.
|
|
|
25,033
|
|
|
|
36,017
|
|
|
|
1,597
|
|
|
|
3,917
|
|
LG Electronics Nanjing New Technology Co., Ltd.
|
|
|
48,471
|
|
|
|
46,373
|
|
|
|
332
|
|
|
|
699
|
|
LG Electronics RUS, LLC
|
|
|
13,496
|
|
|
|
25,102
|
|
|
|
|
|
|
|
80
|
|
LG Electronics do Brasil Ltda.
|
|
|
48,873
|
|
|
|
19,091
|
|
|
|
28
|
|
|
|
10
|
|
LG Innotek Co., Ltd.
|
|
|
4,266
|
|
|
|
407
|
|
|
|
61,441
|
|
|
|
62,675
|
|
Qingdao LG Inspur Digital Communication Co., Ltd.
|
|
|
5,140
|
|
|
|
13,061
|
|
|
|
|
|
|
|
|
|
Inspur LG Digital Mobile Communications Co., Ltd.
|
|
|
36,808
|
|
|
|
55,278
|
|
|
|
|
|
|
|
|
|
90
27.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
Trade accounts and notes receivable
and others
|
|
|
Trade accounts and notes payable
and others
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
LG Electronics Mexicalli S.A. DE C.V.
|
|
W
|
29,350
|
|
|
|
29,440
|
|
|
|
|
|
|
|
|
|
LG Electronics Mlawa Sp. z o.o.
|
|
|
112,980
|
|
|
|
136,874
|
|
|
|
|
|
|
|
25
|
|
LG Hitachi Water Solutions Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
213,164
|
|
|
|
154,864
|
|
LG Electronics Reynosa S.A. DE C.V.
|
|
|
136,737
|
|
|
|
137,413
|
|
|
|
154
|
|
|
|
82
|
|
HiEntech Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
9,463
|
|
|
|
6,679
|
|
HiEntech (Tianjin) Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
14,033
|
|
|
|
5,600
|
|
Others
|
|
|
5,482
|
|
|
|
7,618
|
|
|
|
2,968
|
|
|
|
1,715
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
472,387
|
|
|
|
509,704
|
|
|
|
303,185
|
|
|
|
236,346
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
877,234
|
|
|
|
1,062,789
|
|
|
|
669,045
|
|
|
|
581,704
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
91
27.
|
Related Parties and Others, Continued
|
|
(d)
|
Details of significant cash transactions such as loans and collection of loans, which occurred in the normal course of business with related parties for the three-month periods ended March 31, 2018 and 2017 are as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Associates
|
|
Loans
|
|
|
Collection
of loans
|
|
|
Loans
|
|
|
Collection
of loans
|
|
INVENIA Co., Ltd.
|
|
W
|
|
|
|
|
125
|
|
|
|
|
|
|
|
83
|
|
YAS Co., Ltd.
|
|
|
|
|
|
|
125
|
|
|
|
|
|
|
|
83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
|
|
|
|
250
|
|
|
|
|
|
|
|
166
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
92
27.
|
Related Parties and Others, Continued
|
|
(e)
|
Conglomerate Transactions
|
Transactions, trade accounts and notes receivable and payable, and
others between the Group and certain companies and their subsidiaries, which are included in LG Group, one of conglomerates according to the Monopoly Regulation and Fair Trade Act for the three-month periods ended March 31, 2018 and 2017 and as
of March 31, 2018 and December 31, 2017 are as follows. These entities are not affiliates according to
K-IFRS
No. 1024,
Related Party Disclosures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
For the three-month period ended
March 31, 2018
|
|
|
March 31, 2018
|
|
|
|
Sales
and others
|
|
|
Purchase and
others
|
|
|
Trade accounts and
notes receivable
and others
|
|
|
Trade accounts and
notes payable and
others
|
|
LG Chem Ltd. and its subsidiaries
|
|
W
|
1,564
|
|
|
|
296,701
|
|
|
|
6,148
|
|
|
|
222,759
|
|
LG Household & Health Care and its subsidiaries
|
|
|
|
|
|
|
12
|
|
|
|
|
|
|
|
2
|
|
LG Hausys Ltd.
|
|
|
1,110
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
Serveone Co., Ltd. and its subsidiaries
|
|
|
104
|
|
|
|
475,968
|
|
|
|
21,677
|
|
|
|
645,714
|
|
Silicon Works Co., Ltd.
|
|
|
|
|
|
|
143,295
|
|
|
|
|
|
|
|
148,397
|
|
LG CNS Co., Ltd. and its subsidiaries
|
|
|
|
|
|
|
37,813
|
|
|
|
6
|
|
|
|
41,211
|
|
LG Holdings Japan Co., Ltd.
|
|
|
|
|
|
|
456
|
|
|
|
2,013
|
|
|
|
|
|
LG International Corp. and its subsidiaries
|
|
|
200,628
|
|
|
|
413,836
|
|
|
|
131,491
|
|
|
|
261,563
|
|
LG Management Development Institute
|
|
|
|
|
|
|
2,813
|
|
|
|
3,480
|
|
|
|
607
|
|
G2R Inc. and its subsidiaries
|
|
|
|
|
|
|
4,041
|
|
|
|
|
|
|
|
5,301
|
|
LG Corp.
|
|
|
|
|
|
|
12,791
|
|
|
|
6,794
|
|
|
|
6,951
|
|
LG Uplus Corp.
|
|
|
|
|
|
|
224
|
|
|
|
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
203,406
|
|
|
|
1,387,951
|
|
|
|
171,609
|
|
|
|
1,332,538
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
93
27.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
For the three-month period ended
March 31, 2017
|
|
|
December 31, 2017
|
|
|
|
Sales
and others
|
|
|
Purchase and
others
|
|
|
Trade accounts and
notes receivable
and others
|
|
|
Trade accounts and
notes payable and
others
|
|
LG Chem Ltd. and its subsidiaries
|
|
W
|
5
|
|
|
|
330,222
|
|
|
|
8,684
|
|
|
|
246,491
|
|
LG Household & Health Care and its subsidiaries
|
|
|
|
|
|
|
62
|
|
|
|
|
|
|
|
3
|
|
LG Hausys Ltd.
|
|
|
418
|
|
|
|
44
|
|
|
|
|
|
|
|
374
|
|
Serveone Co., Ltd. and its subsidiaries
|
|
|
115
|
|
|
|
371,400
|
|
|
|
21,568
|
|
|
|
645,847
|
|
Silicon Works Co., Ltd.
|
|
|
|
|
|
|
147,017
|
|
|
|
|
|
|
|
120,031
|
|
SK Siltron Co., Ltd. (formerly, SIltron Co., Ltd.) (*)
|
|
|
10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG CNS Co., Ltd. and its subsidiaries
|
|
|
37
|
|
|
|
30,630
|
|
|
|
4
|
|
|
|
115,899
|
|
LG Holdings Japan Co., Ltd.
|
|
|
|
|
|
|
468
|
|
|
|
1,908
|
|
|
|
|
|
LG International Corp. and its subsidiaries
|
|
|
176,066
|
|
|
|
396,022
|
|
|
|
112,200
|
|
|
|
230,179
|
|
LG Management Development Institute
|
|
|
|
|
|
|
2,010
|
|
|
|
3,480
|
|
|
|
699
|
|
G2R Inc. and its subsidiaries
|
|
|
|
|
|
|
829
|
|
|
|
|
|
|
|
14,785
|
|
LG Corp.
|
|
|
|
|
|
|
15,699
|
|
|
|
4,700
|
|
|
|
1,523
|
|
Lusem Co., Ltd. (*)
|
|
|
6
|
|
|
|
499
|
|
|
|
1
|
|
|
|
53
|
|
LG Uplus Corp.
|
|
|
51
|
|
|
|
186
|
|
|
|
|
|
|
|
1,506
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
176,708
|
|
|
|
1,295,088
|
|
|
|
152,545
|
|
|
|
1,377,390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Represents transactions occurred prior to disposal of the entire investments.
|
94
27.
|
Related Parties and Others, Continued
|
|
(f)
|
Key management personnel compensation
|
Compensation costs of key management for the three-month
periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Short-term benefits
|
|
W
|
888
|
|
|
|
1,317
|
|
Expenses related to the defined benefit plan
|
|
|
273
|
|
|
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,161
|
|
|
|
1,410
|
|
|
|
|
|
|
|
|
|
|
Key management refers to the registered directors who have significant control and responsibilities over the
Controlling Companys operations and business.
|
(a)
|
In April 2018, the Controlling Company received advances from a customer amounting to USD 300 million (
W
320,670 million) in aggregate in connection with long-term supply
agreements. The advances received will be offset against outstanding accounts receivable balances after a given period of time, as well as those arising from the sale of products thereafter. The Controlling Company received a payment guarantee from
the Export-Import Bank of Korea amounting to USD 300 million (
W
320,670 million) relating to advances received.
|
|
(b)
|
In April 2018, the Group obtained additional borrowings amounting to USD 200 million (
W
214,740 million).
|
95
LG DISPLAY CO., LTD.
Condensed Separate Interim Financial Statements
(Unaudited)
March 31, 2018 and 2017
(With Independent
Auditors Review Report Thereon)
96
Table of Contents
97
Independent Auditors Review Report
Based on a report originally issued in Korean
To the Board of Directors and Shareholders
LG Display Co.,
Ltd.:
Reviewed Financial Statements
We have
reviewed the accompanying condensed separate interim financial statements of LG Display Co., Ltd. (the Company) which comprise the condensed separate interim statement of financial position as of March 31, 2018, the condensed
separate interim statements of comprehensive income, changes in equity and cash flows for the three-month periods ended March 31, 2018 and 2017, and notes, comprising a summary of significant accounting policies and other explanatory
information.
Managements Responsibility for the Condensed Separate Interim Financial Statements
Management is responsible for the preparation and fair presentation of these condensed separate interim financial statements in accordance with Korean
International Financial Reporting Standards No. 1034,
Interim Financial Reporting,
and for such internal controls as management determines necessary to enable the preparation of condensed separate interim financial statements that are
free from material misstatement, whether due to fraud or error.
Auditors Responsibility
Our responsibility is to issue a report on these condensed separate interim financial statements based on our reviews.
We conducted our reviews in accordance with the Review Standards for Quarterly and Semiannual Financial Statements established by the Security and Futures
Commission of the Republic of Korea. A review of interim financial information consists principally of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A
review is substantially less in scope than an audit conducted in accordance with Korean Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our reviews, nothing has come to our attention that causes us to believe that the condensed separate interim financial statements referred to above
are not presented fairly, in all material respects, in accordance with Korean International Financial Reporting Standards No. 1034,
Interim Financial Reporting
.
Other Matters
The procedures and practices
utilized in the Republic of Korea to review such condensed separate interim financial statements may differ from those generally accepted and applied in other countries.
We audited the separate statement of financial position as of December 31, 2017, and the related separate statements of comprehensive income, changes in
equity and cash flows for the year then ended, which are not accompanying this review report, in accordance with Korean Standards on Auditing, and our report thereon, dated February 22, 2018, expressed an unqualified opinion. The accompanying
condensed separate statement of financial position of the Company as of December 31, 2017, presented for comparative purposes, is not different from that audited by us from which it was derived in all material respects.
98
/s/ KPMG Samjong Accounting Corp.
Seoul, Korea
May 14, 2018
This report is effective as of May 14, 2018, the review report date. Certain subsequent events or
circumstances
,
which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying condensed separate interim financial statements and notes thereto. Accordingly, the readers of
the review report should understand that the above review report has not been updated to reflect the impact of such subsequent events or circumstances, if any.
99
LG DISPLAY CO., LTD.
Condensed Separate Interim Statements of Financial Position
(Unaudited)
As of March 31, 2018 and December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Note
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
4, 24
|
|
|
W
|
434,823
|
|
|
|
566,408
|
|
Deposits in banks
|
|
|
4, 24
|
|
|
|
377,200
|
|
|
|
580,770
|
|
Trade accounts and notes receivable, net
|
|
|
5, 14, 24, 26
|
|
|
|
3,769,860
|
|
|
|
4,673,570
|
|
Other accounts receivable, net
|
|
|
5, 24
|
|
|
|
708,905
|
|
|
|
687,109
|
|
Other current financial assets
|
|
|
6, 24
|
|
|
|
11,707
|
|
|
|
13,499
|
|
Inventories
|
|
|
7
|
|
|
|
1,650,056
|
|
|
|
1,682,245
|
|
Other current assets
|
|
|
5
|
|
|
|
326,503
|
|
|
|
177,473
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
|
|
|
|
7,279,054
|
|
|
|
8,381,074
|
|
Deposits in banks
|
|
|
4, 24
|
|
|
|
11
|
|
|
|
11
|
|
Investments
|
|
|
8
|
|
|
|
3,269,871
|
|
|
|
2,683,941
|
|
Other
non-current
financial assets
|
|
|
6, 24
|
|
|
|
63,316
|
|
|
|
64,772
|
|
Property, plant and equipment, net
|
|
|
9
|
|
|
|
13,669,128
|
|
|
|
12,487,001
|
|
Intangible assets, net
|
|
|
10
|
|
|
|
738,473
|
|
|
|
731,373
|
|
Deferred tax assets
|
|
|
22
|
|
|
|
800,123
|
|
|
|
727,248
|
|
Other
non-current
assets
|
|
|
5
|
|
|
|
333,567
|
|
|
|
333,995
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-current
assets
|
|
|
|
|
|
|
18,874,489
|
|
|
|
17,028,341
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
|
|
W
|
26,153,543
|
|
|
|
25,409,415
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade accounts and notes payable
|
|
|
24, 26
|
|
|
W
|
2,507,732
|
|
|
|
2,391,493
|
|
Current financial liabilities
|
|
|
11, 24
|
|
|
|
1,480,285
|
|
|
|
1,060,735
|
|
Other accounts payable
|
|
|
24
|
|
|
|
2,816,545
|
|
|
|
2,701,823
|
|
Accrued expenses
|
|
|
|
|
|
|
472,280
|
|
|
|
755,062
|
|
Income tax payable
|
|
|
|
|
|
|
51,053
|
|
|
|
235,593
|
|
Provisions
|
|
|
13
|
|
|
|
71,701
|
|
|
|
73,685
|
|
Advances received
|
|
|
14, 27
|
|
|
|
209,102
|
|
|
|
142,700
|
|
Other current liabilities
|
|
|
13
|
|
|
|
216,429
|
|
|
|
33,514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
|
|
|
|
7,825,127
|
|
|
|
7,394,605
|
|
Non-current
financial liabilities
|
|
|
11, 24
|
|
|
|
3,752,343
|
|
|
|
3,165,413
|
|
Non-current
provisions
|
|
|
13
|
|
|
|
22,635
|
|
|
|
28,312
|
|
Defined benefit liabilities, net
|
|
|
12
|
|
|
|
149,957
|
|
|
|
94,535
|
|
Long-term advances received
|
|
|
14, 27
|
|
|
|
759,881
|
|
|
|
830,335
|
|
Other
non-current
liabilities
|
|
|
13
|
|
|
|
77,736
|
|
|
|
66,956
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
non-current
liabilities
|
|
|
|
|
|
|
4,762,552
|
|
|
|
4,185,551
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
|
|
|
|
12,587,679
|
|
|
|
11,580,156
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
|
15
|
|
|
|
1,789,079
|
|
|
|
1,789,079
|
|
Share premium
|
|
|
|
|
|
|
2,251,113
|
|
|
|
2,251,113
|
|
Retained earnings
|
|
|
|
|
|
|
9,525,672
|
|
|
|
9,789,067
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity
|
|
|
|
|
|
|
13,565,864
|
|
|
|
13,829,259
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity
|
|
|
|
|
|
W
|
26,153,543
|
|
|
|
25,409,415
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the separate interim financial statements.
100
LG DISPLAY CO., LTD.
Condensed Separate Interim Statements of Comprehensive Income (Loss)
(Unaudited)
For the three-month periods
ended March 31, 2018 and 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won, except earnings per share)
|
|
Note
|
|
|
2018
|
|
|
2017
|
|
Revenue
|
|
|
16, 26
|
|
|
W
|
5,154,261
|
|
|
|
6,542,947
|
|
Cost of sales
|
|
|
7, 17, 26
|
|
|
|
(4,902,524
|
)
|
|
|
(5,218,933
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
|
|
|
|
251,737
|
|
|
|
1,324,014
|
|
Selling expenses
|
|
|
18
|
|
|
|
(99,213
|
)
|
|
|
(166,905
|
)
|
Administrative expenses
|
|
|
18
|
|
|
|
(124,655
|
)
|
|
|
(117,802
|
)
|
Research and development expenses
|
|
|
|
|
|
|
(281,490
|
)
|
|
|
(280,296
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit (loss)
|
|
|
|
|
|
|
(253,621
|
)
|
|
|
759,011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance income
|
|
|
21
|
|
|
|
105,695
|
|
|
|
107,768
|
|
Finance costs
|
|
|
21
|
|
|
|
(16,910
|
)
|
|
|
(32,843
|
)
|
Other
non-operating
income
|
|
|
20
|
|
|
|
117,004
|
|
|
|
304,161
|
|
Other
non-operating
expenses
|
|
|
20
|
|
|
|
(112,415
|
)
|
|
|
(489,551
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) before income tax
|
|
|
|
|
|
|
(160,247
|
)
|
|
|
648,546
|
|
Income tax expense (benefit)
|
|
|
22
|
|
|
|
(79,883
|
)
|
|
|
134,434
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
|
|
|
|
(80,364
|
)
|
|
|
514,112
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
Items that will never be reclassified to profit or loss
|
|
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of net defined benefit liabilities
|
|
|
12
|
|
|
|
(6,419
|
)
|
|
|
(4,725
|
)
|
Related income tax
|
|
|
12
|
|
|
|
2,296
|
|
|
|
1,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,123
|
)
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss for the period, net of income tax
|
|
|
|
|
|
|
(4,123
|
)
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income (loss) for the period
|
|
|
|
|
|
W
|
(84,487
|
)
|
|
|
510,530
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share (In Won)
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per share
|
|
|
23
|
|
|
W
|
(225
|
)
|
|
|
1,437
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings (loss) per share
|
|
|
23
|
|
|
W
|
(225
|
)
|
|
|
1,437
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the separate interim financial statements.
101
LG DISPLAY CO., LTD.
Condensed Separate Interim Statements of Changes in Equity
(Unaudited)
For the three-month periods ended March 31,
2018 and 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
|
|
|
Share
|
|
|
Retained
|
|
|
|
|
|
Total
|
|
(In millions of won)
|
|
capital
|
|
|
premium
|
|
|
earnings
|
|
|
Reserves
|
|
|
equity
|
|
Balances at January 1, 2017
|
|
W
|
1,789,079
|
|
|
|
2,251,113
|
|
|
|
8,195,255
|
|
|
|
|
|
|
|
12,235,447
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the period
|
|
|
|
|
|
|
|
|
|
|
514,112
|
|
|
|
|
|
|
|
514,112
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of net defined benefit liabilities, net of tax
|
|
|
|
|
|
|
|
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period
|
|
W
|
|
|
|
|
|
|
|
|
510,530
|
|
|
|
|
|
|
|
510,530
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction with owners, recognized directly in equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends to equity holders
|
|
|
|
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances at March 31, 2017
|
|
W
|
1,789,079
|
|
|
|
2,251,113
|
|
|
|
8,526,877
|
|
|
|
|
|
|
|
12,567,069
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances at January 1, 2018
|
|
W
|
1,789,079
|
|
|
|
2,251,113
|
|
|
|
9,789,067
|
|
|
|
|
|
|
|
13,829,259
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the period
|
|
|
|
|
|
|
|
|
|
|
(80,364
|
)
|
|
|
|
|
|
|
(80,364
|
)
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of net defined benefit liabilities, net of tax
|
|
|
|
|
|
|
|
|
|
|
(4,123
|
)
|
|
|
|
|
|
|
(4,123
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
(4,123
|
)
|
|
|
|
|
|
|
(4,123
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the period
|
|
W
|
|
|
|
|
|
|
|
|
(84,487
|
)
|
|
|
|
|
|
|
(84,487
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction with owners, recognized directly in equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends to equity holders
|
|
|
|
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
(178,908
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances at March 31, 2018
|
|
W
|
1,789,079
|
|
|
|
2,251,113
|
|
|
|
9,525,672
|
|
|
|
|
|
|
|
13,565,864
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the separate interim financial statements.
102
LG DISPLAY CO., LTD.
Condensed Separate Interim Statements of Cash Flows
(Unaudited)
For the three-month periods
ended March 31, 2018 and 2017 .
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Note
|
|
2018
|
|
|
2017
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period
|
|
|
|
W
|
(80,364
|
)
|
|
|
514,112
|
|
Adjustments for:
|
|
|
|
|
|
|
|
|
|
|
Income tax expense (benefit)
|
|
22
|
|
|
(79,883
|
)
|
|
|
134,434
|
|
Depreciation
|
|
17
|
|
|
479,483
|
|
|
|
392,838
|
|
Amortization of intangible assets
|
|
17
|
|
|
93,967
|
|
|
|
97,781
|
|
Gain on foreign currency translation
|
|
|
|
|
(39,949
|
)
|
|
|
(55,662
|
)
|
Loss on foreign currency translation
|
|
|
|
|
38,035
|
|
|
|
139,210
|
|
Expenses related to defined benefit plans
|
|
12
|
|
|
51,351
|
|
|
|
49,213
|
|
Gain on disposal of property, plant and equipment
|
|
|
|
|
(13,715
|
)
|
|
|
(30,314
|
)
|
Loss on disposal of property, plant and equipment
|
|
|
|
|
3,826
|
|
|
|
1,957
|
|
Gain on disposal of intangible assets
|
|
|
|
|
(239
|
)
|
|
|
|
|
Impairment loss on intangible assets
|
|
|
|
|
37
|
|
|
|
1,689
|
|
Reversal of impairment loss on intangible assets
|
|
|
|
|
(130
|
)
|
|
|
|
|
Warranty expenses
|
|
|
|
|
29,340
|
|
|
|
68,177
|
|
Finance income
|
|
|
|
|
(104,342
|
)
|
|
|
(103,596
|
)
|
Finance costs
|
|
|
|
|
11,621
|
|
|
|
16,023
|
|
Other income
|
|
|
|
|
(364
|
)
|
|
|
(154
|
)
|
Other expenses
|
|
|
|
|
592
|
|
|
|
46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
469,630
|
|
|
|
711,642
|
|
Changes in
|
|
|
|
|
|
|
|
|
|
|
Trade accounts and notes receivable
|
|
|
|
|
872,945
|
|
|
|
250,322
|
|
Other accounts receivable
|
|
|
|
|
60,025
|
|
|
|
(15,510
|
)
|
Inventories
|
|
|
|
|
(58,766
|
)
|
|
|
100,076
|
|
Other current assets
|
|
|
|
|
(125,476
|
)
|
|
|
(140,908
|
)
|
Other
non-current
assets
|
|
|
|
|
(18,249
|
)
|
|
|
(25,413
|
)
|
Trade accounts and notes payable
|
|
|
|
|
131,583
|
|
|
|
(590,469
|
)
|
Other accounts payable
|
|
|
|
|
(153,854
|
)
|
|
|
(2,488
|
)
|
Accrued expenses
|
|
|
|
|
(284,578
|
)
|
|
|
(160,928
|
)
|
Provisions
|
|
|
|
|
(46,791
|
)
|
|
|
(45,195
|
)
|
Other current liabilities
|
|
|
|
|
6,959
|
|
|
|
5,841
|
|
Defined benefit liabilities, net
|
|
|
|
|
(2,348
|
)
|
|
|
(1,734
|
)
|
Other
non-current
liabilities
|
|
|
|
|
8,747
|
|
|
|
1,366
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
390,197
|
|
|
|
(625,040
|
)
|
Cash generated from operating activities
|
|
|
|
|
779,463
|
|
|
|
600,714
|
|
Income taxes paid
|
|
|
|
|
(2,955
|
)
|
|
|
(15,394
|
)
|
Interests received
|
|
|
|
|
7,151
|
|
|
|
5,660
|
|
Interests paid
|
|
|
|
|
(27,837
|
)
|
|
|
(21,636
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
|
W
|
755,822
|
|
|
|
569,344
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the
separate interim financial statements.
103
LG DISPLAY CO., LTD.
Condensed Separate Interim Statements of Cash Flows, Continued
(Unaudited)
For the three-month periods
ended March 31, 2018 and 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Note
|
|
|
2018
|
|
|
2017
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends received
|
|
|
|
|
|
W
|
23,576
|
|
|
|
315,939
|
|
Increase in deposits in banks
|
|
|
|
|
|
|
(200,500
|
)
|
|
|
(200,500
|
)
|
Proceeds from withdrawal of deposits in banks
|
|
|
|
|
|
|
403,715
|
|
|
|
400,501
|
|
Acquisition of investments
|
|
|
|
|
|
|
(585,930
|
)
|
|
|
(46,500
|
)
|
Proceeds from disposal of investments
|
|
|
|
|
|
|
|
|
|
|
5,157
|
|
Acquisition of property, plant and equipment
|
|
|
|
|
|
|
(1,509,104
|
)
|
|
|
(1,036,604
|
)
|
Proceeds from disposal of property, plant and equipment
|
|
|
|
|
|
|
102,923
|
|
|
|
87,220
|
|
Acquisition of intangible assets
|
|
|
|
|
|
|
(129,298
|
)
|
|
|
(111,593
|
)
|
Proceeds from disposal of intangible assets
|
|
|
|
|
|
|
960
|
|
|
|
|
|
Receipt from settlement of derivatives
|
|
|
|
|
|
|
(2
|
)
|
|
|
(101
|
)
|
Proceeds from collection of short-term loans
|
|
|
|
|
|
|
5,714
|
|
|
|
|
|
Increase in long-term loans
|
|
|
|
|
|
|
(12,300
|
)
|
|
|
|
|
Increase in deposits
|
|
|
|
|
|
|
(118
|
)
|
|
|
(933
|
)
|
Decrease in deposits
|
|
|
|
|
|
|
|
|
|
|
566
|
|
Proceeds from disposal of emission rights
|
|
|
|
|
|
|
4,160
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
|
|
|
|
(1,896,204
|
)
|
|
|
(586,848
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
25
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of bonds
|
|
|
|
|
|
|
388,447
|
|
|
|
|
|
Proceeds from long-term borrowings
|
|
|
|
|
|
|
800,000
|
|
|
|
|
|
Repayments of current portion of long-term borrowings and bonds
|
|
|
|
|
|
|
(180,169
|
)
|
|
|
(63,216
|
)
|
Payment guarantee fee received
|
|
|
|
|
|
|
519
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
|
|
|
|
1,008,797
|
|
|
|
(63,216
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents
|
|
|
|
|
|
|
(131,585
|
)
|
|
|
(80,720
|
)
|
Cash and cash equivalents at January 1
|
|
|
|
|
|
|
566,408
|
|
|
|
259,467
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at March 31
|
|
|
|
|
|
W
|
434,823
|
|
|
|
178,747
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the separate interim financial statements.
105
1.
|
Organization and Description of Business
|
LG Display Co., Ltd. (the
Company) was incorporated in February 1985 and the Company is a public corporation listed in Korea Exchange since 2004. The main business of the Company is to manufacture and sell displays and its related products. As of March 31,
2018, the Company is operating Thin Film Transistor Liquid Crystal Display
(TFT-LCD)
and Organic Light Emitting Diode (OLED) panel manufacturing plants in Gumi, Paju and China and
TFT-LCD
and OLED module manufacturing plants in Gumi, Paju, China, Poland and Vietnam. The Company is domiciled in the Republic of Korea with its address at 128
Yeouidae-ro,
Yeongdeungpo-gu,
Seoul, the Republic of Korea. As of March 31, 2018, LG Electronics Inc., a major shareholder of the Company, owns 37.9% (135,625,000 shares) of the Companys common stock.
The Companys common stock is listed on the Korea Exchange under the identifying code 034220. As of March 31, 2018, there are
357,815,700 shares of common stock outstanding. The Companys common stock is also listed on the New York Stock Exchange in the form of American Depository Shares (ADSs) under the symbol LPL. One ADS represents
one-half
of one share of common stock. As of March 31, 2018, there are 23,730,762 ADSs outstanding.
2.
|
Basis of Presenting Financial Statements
|
|
(a)
|
Statement of Compliance
|
The condensed separate interim financial statements have been
prepared in accordance with Korean International Financial Reporting Standards
(K-IFRSs)
No.1034,
Interim Financial Reporting.
They do not include all of the information required for full
annual financial statements and should be read in conjunction with the separate financial statements of the Company as of and for the year ended December 31, 2017.
These condensed interim financial statements are separate interim financial statements prepared in accordance with
K-IFRS
No.1027,
Separate Financial Statements,
presented by a parent, an investor in an associate, in which the investments are accounted for on the basis of the direct equity interest rather than on the
basis of the reported results and net assets of the investees.
This is the first set of the Companys financial statements where
K-IFRS
No. 1109,
K-IFRS
No. 1115, and
K-IFRS
No. 2122 have been applied. Changes to significant accounting policies are
described in Note 3.
105
2.
|
Basis of Presenting Financial Statements, Continued
|
The condensed separate interim financial statements have been
prepared on the historical cost basis except for the following material items in the statements of financial position:
|
|
|
financial assets at fair value through profit or loss (FVTPL) and financial asset at fair value through other comprehensive income (FVOCI) and
|
|
|
|
net defined benefit liabilities are recognized as the present value of defined benefit obligations less the fair value of plan assets
|
|
(c)
|
Functional and Presentation Currency
|
The condensed separate interim financial
statements are presented in Korean won, which is the Companys functional currency.
|
(d)
|
Use of Estimates and Judgments
|
The preparation of the condensed separate interim
financial statements in conformity with
K-IFRSs
requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets,
liabilities, income and expenses. Actual results may differ from these estimates.
In result of the Company utilizing the past accumulated
usage information to reassess the economic useful life of the Mask and Mold which has been classified as inventory, the Company expected the useful lives of Mask and Mold to exceed one year; therefore, the Company changed useful lives of Mask and
Mold to two years and treated it as a change in accounting estimate. The Company also changed the classification of Mask and Mold to property, plant and equipment. As a result,
W
90,955 million of inventory
(supplies) at December 31, 2017 is classified as property, plant and equipment (tools) during the three-month period ended March 31, 2018.
In preparing these condensed separate interim financial statements, the significant judgments made by management in applying the Companys
accounting policies and the key sources of estimation uncertainty were the same as those applied in the last annual financial statements, except for new significant judgments and key sources of estimation uncertainty related to the application of
K-IFRS
No. 1109,
K-IFRS
No. 1115 in Note 3 and the change in useful life of Mask and Mold.
106
3.
|
Summary of Significant Accounting Policies
|
The significant accounting policies followed
by the Company in the preparation of its condensed separate interim financial statements are the same as those followed by the Company in its preparation of the separate financial statements as of and for the year ended December 31, 2017,
except for the application of
K-IFRS
No. 1034,
Interim Financial Reporting
and the changes in accounting standards explained below. The changes in accounting policies are also expected to be
reflected in the Companys separate financial statements as at and for the year ending December 31, 2018.
|
(a)
|
Changes in Accounting Policies
|
The Company has initially adopted
K-IFRS
No. 1115,
Revenue from Contracts with Customers,
K-IFRS
No. 1109,
Financial Instruments, and
K-IFRS
No. 2122
, Foreign Currency Transactions and Advance Consideration,
from January 1, 2018.
|
(i)
|
K-IFRS
No.
1109,
Financial Instruments
|
K-IFRS
No. 1109 set out requirements for recognizing and measuring financial assets, financial
liabilities and some contracts to buy or sell
non-financial
items. This standards replaces
K-IFRS
No. 1039
Financial Instruments: Recognition and
Measurement
. The Company adopted
K-IFRS
No. 1109,
Financial Instruments
, from January 1, 2018, and the Company has taken an exemption not to restate the financial statements for prior
years with respects to transition requirements.
The details of new significant accounting policies and the nature and effect of the
changes to previous accounting policies are set out below. There is no impact on the opening balance of retained earnings at January 1, 2018.
|
i)
|
Classification and measurement of financial assets and financial liabilities
|
K-IFRS
No. 1109 largely retains the existing requirements in
K-IFRS
No. 1039 for the classification and measurement of financial liabilities. However, it eliminates
the previous
K-IFRS
No. 1039 categories for financial assets of held to maturity, loans and receivables and available for sale.
The adoption
K-IFRS
No. 1109 has not had a significant effect on the Companys accounting
policies related to financial liabilities and derivative financial instruments. The impact of
K-IFRS
No. 1109 on the classification and measurement of financial assets is set out below.
Under
K-IFRS
No. 1109, on initial recognition, a financial asset is classified as measured at:
amortized cost; FVOCI-debt investment; FVOCI-equity investment; or FVTPL. The classification of financial assets under
K-IFRS
1109 is generally based on the business model in which a financial asset is managed
and its contractual cash flow characteristics.
A financial asset is measured at amortized cost if it meets both of the following
conditions and is not designated as at FVTPL:
|
|
|
It is held within a business model whose objective is to hold assets to collect contractual cash flow; and
|
|
|
|
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
|
107
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(a)
|
Changes in Accounting Policies, Continued
|
A debt investment is measured at FVOCI if it
meets both of the following conditions and is not designated as at FVTPL:
|
|
|
It is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
|
|
|
|
its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
|
On initial recognition of an equity investment that is not held for trading, the Company may irrevocably elect to present subsequent changes in
the investments fair value in OCI. This election is made on an
investment-by-investment
basis.
All financial assets not classified as measured at amortized cost or FVOCI as described above are measured at FVTPL. This includes all
derivative financial assets. On initial recognition, the Company may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly
reduces an accounting mismatch that would otherwise arise.
A financial asset (unless it is a trade receivable without a significant
financing component that is initially measured at the transaction price) is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly attributable to its acquisition.
The following accounting policies apply to the subsequent measurement of financial assets.
|
|
|
|
|
|
|
Financial assets at FVTPL
|
|
These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognized in profit or loss.
|
|
|
|
|
|
Financial assets at amortized cost
|
|
These assets are subsequently measured at amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognized in
profit or loss. Any gain or loss on derecognition is recognized in profit or loss.
|
|
|
|
|
|
Debt investments at FVOCI
|
|
These assets are subsequently measured at fair value. Interest income calculated using the effective interest method, foreign exchange gains and losses and impairment are recognized in profit or loss. Other net gains and losses are
recognized in OCI. On derecognition, gains and losses accumulated in OCI are reclassified to profit or loss.
|
108
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(a)
|
Changes in Accounting Policies, Continued
|
The following table below explain the
original measurement categories under
K-IFRS
No. 1039 and the changes in measurement categories under
K-IFRS
No. 1109 for each class of the Companys
financial assets as at January 1, 2018 are as below.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
Original
classification under
K-IFRS
No. 1039
|
|
|
New
classification under
K-IFRS
No. 1109
|
|
|
Original
carrying
amount under
K-IFRS
No. 1039
|
|
|
New carrying
amount under
K-IFRS No. 1109
|
|
|
Difference
|
|
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
W
|
566,408
|
|
|
|
566,408
|
|
|
|
|
|
Deposits
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
|
580,781
|
|
|
|
580,781
|
|
|
|
|
|
Trade receivables
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
|
4,673,570
|
|
|
|
4,673,570
|
|
|
|
|
|
Other receivables
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
|
687,109
|
|
|
|
687,109
|
|
|
|
|
|
Debt instrument
|
|
|
Available-for-sale
|
|
|
|
FVOCI-debt
instrument
|
|
|
|
162
|
|
|
|
162
|
|
|
|
|
|
Equity instrument
|
|
|
Available-for-sale
|
|
|
|
Mandatorily at
FVTPL
|
|
|
|
2,697
|
|
|
|
2,697
|
|
|
|
|
|
Convertible bonds
|
|
|
Designated as at
FVTPL
|
|
|
|
Mandatorily at
FVTPL
|
|
|
|
1,552
|
|
|
|
1,552
|
|
|
|
|
|
Derivatives
|
|
|
Designated as at
FVTPL
|
|
|
|
Mandatorily at
FVTPL
|
|
|
|
842
|
|
|
|
842
|
|
|
|
|
|
Others
|
|
|
Loans and
receivables
|
|
|
|
Amortized cost
|
|
|
|
73,018
|
|
|
|
73,018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total financial assets
|
|
|
|
|
|
|
|
|
|
W
|
6,586,139
|
|
|
|
6,586,139
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of January 1, 2018, there was no financial liabilities measured at FVTPL.
|
ii)
|
Impairment of financial assets
|
K-IFRS
No. 1109
replaces the incurred loss model in
K-IFRS
No. 1039 with an expected credit loss (ECL) model. The new impairment model applies to financial assets measured at amortized cost,
contract assets and debt investments at FVOCI, but not to investments in equity instruments. Under
K-IFRS
No. 1109, credit losses are recognized earlier than under
K-IFRS
No. 1039.
ECLs are a probability-weighted estimate of credit losses. Credit losses are
measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Company expects to receive).
At each reporting date, the Company assesses whether financial assets carried at amortized cost and debt securities at FVOCI are
credit-impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.
109
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(a)
|
Changes in Accounting Policies, Continued
|
Loss allowances for financial assets
measured at amortized cost are deducted from the gross carrying amount of the assets. For debt securities at FVOCI, the loss allowance is recognized in OCI, instead of reducing the carrying amount of the asset.
As a result of applying the loss allowances model under
K-IFRS
No. 1109, as of January 1,
2018, there are no additional loss allowances as compared with the loss allowances under
K-IFRS
No. 1039.
When initially applying
K-IFRS
No. 1109, the Company elected as its accounting policy to continue to apply hedge accounting requirements under
K-IFRS
No. 1039 instead of the requirements in
K-IFRS
No. 1109. As of January 1, 2018, there is no impact on the separate financial statement of the Company resulting from the application of the requirements in
K-IFRS
No. 1109.
|
(ii)
|
K-IFRS
No.
1115,
Revenue from Contracts with Customers
|
K-IFRS
No. 1115,
Revenue from contracts with customers
, establishes a comprehensive
framework for determining whether, how much and when revenue is recognized.
K-IFRS
No. 1115 replaces existing revenue recognition guidance, including
K-IFRS
No. 1018
Revenue
,
K-IFRS
No. 1011,
Construction Contracts
,
K-IFRS
No. 2031,
Revenue: Barter Transactions Involving Advertising
Services
,
K-IFRS
No. 2113,
Customer Loyalty Programmes
,
K-IFRS
No. 2115,
Agreements for the Construction of Real Estate
and
K-IFRS
No. 2118,
Transfers of Assets from Customers
.
The Company has initially applied
K-IFRS
No. 1115,
Revenue from contracts with customers
, from January 1, 2018. Regarding transition to
K-IFRS
No.1115, the Company has decided to apply the
cumulative effect method, i.e. recognizing the cumulative effect of applying
K-IFRS
No. 1115 at the date of initial application, which is January 1, 2018, without restatement of the comparative
periods presented. The impact on its separate financial statements resulting from the application of the new standard is as follows.
Variable Consideration
The consideration received from customers may be variable as the Company allows its customers to return their products according to the
contracts. For the year-ended December 31, 2017, the Company recognizes a provision measured at the gross profit for products sold which are expected to be returned. Under
K-IFRS
No. 1115, the
Company shall estimate an amount of variable consideration by using the expected value or the most likely amount, depending on which method the entity expects to better predict the amount of consideration to which it will be entitled and include in
the transaction price some or all of an amount of variable consideration estimated only to the extent that is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when return period expires. The
Company shall recognize refund liability measured at the amount of consideration received (or receivable) to which the Company does not expect to be entitled and a new asset for the right to recover returned goods. As a result of this change, the
refund liability and a new asset for the right to recover returned goods increased by
W
9,789 million, respectively, as of January 1, 2018. There is no impact on the opening balance of retained earnings at
January 1, 2018. (Note 5(d), 13(a))
110
3.
|
Summary of Significant Accounting Policies, Continued
|
|
(a)
|
Changes in Accounting Policies, Continued
|
The effect of the application of
K-IFRS
No. 1115 on the Companys separate interim statement of financial position as of March 31, 2018 is as follows. There is no impact on the separate interim statement of comprehensive income and
the cash flows for the three-month period ended March 31, 2018.
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions won)
|
|
|
|
|
|
|
|
|
|
Categories
|
|
Adoption of
K-IFRS No. 1115
|
|
|
Adjustments
|
|
|
Adoption of
K-IFRS No. 1018
|
|
Current Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Other current assets
|
|
W
|
326,503
|
|
|
|
(6,923
|
)
|
|
|
319,580
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Provisions
|
|
W
|
71,701
|
|
|
|
(6,923
|
)
|
|
|
64,778
|
|
|
(iii)
|
K-IFRS
No.
2122,
Foreign Currency Transactions and Advance Consideration
|
According to the new interpretation,
K-IFRS
No. 2122,
Foreign Currency Transactions and
Advance Consideration
, the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income (or part of it) is the date on which an entity initially recognizes the
non-monetary
asset or
non-monetary
liability arising from the payment or receipt of advance consideration. If there are multiple payments or receipts in advance, the entity
shall determine a date of the transaction for each payment or receipt of advance consideration. There is no significant impact on the separate financial statements of the Company.
|
(b)
|
New Standards and Amendments Not Yet Adopted
|
The following new standard is effective
for annual periods beginning after January 1, 2018 and earlier application is permitted; however, the Company has not early adopted the following new standard in preparing these condensed separate interim financial statements.
|
(i)
|
K-IFRS
No. 1116,
Leases
|
The
Company plans to adopt
K-IFRS
No. 1116,
Leases
, in its separate financial statements for annual period beginning on January 1, 2019, assess the financial impact of the adoption of
K-IFRS
No. 1116 and disclose the results in its separate financial statements for the year ending December 31, 2018. As of March 31, 2018, other than the potential impacts described in the separate
financial statements as of and for the year ended December 31, 2017, there are no significant changes in relation to preparation for the adoption of this new standard.
111
4.
|
Cash and
C
ash
E
quivalents
and Deposits in Banks
|
Cash
and cash equivalents and deposits in banks as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current assets
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
Demand deposits
|
|
W
|
434,823
|
|
|
|
566,408
|
|
Deposits in banks
|
|
|
|
|
|
|
|
|
Time deposits
|
|
W
|
304,145
|
|
|
|
507,930
|
|
Restricted cash (*)
|
|
|
73,055
|
|
|
|
72,840
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
377,200
|
|
|
|
580,770
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
Deposits in banks
|
|
|
|
|
|
|
|
|
Restricted cash (*)
|
|
W
|
11
|
|
|
|
11
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
812,034
|
|
|
|
1,147,189
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Restricted cash includes mutual growth fund to aid LG Groups second and third-tier suppliers, pledge to enforce investment plans according to the receipt of subsidies from Gumi city and
Gyeongsangbuk-do
and others.
|
112
5.
|
Receivables and Other Assets
|
|
(a)
|
Trade accounts and notes receivable as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Trade, net
|
|
W
|
332,442
|
|
|
|
355,332
|
|
Due from related parties
|
|
|
3,437,418
|
|
|
|
4,318,238
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,769,860
|
|
|
|
4,673,570
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Other accounts receivable as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current assets
|
|
|
|
|
|
|
|
|
Non-trade
receivable, net
|
|
W
|
704,604
|
|
|
|
678,454
|
|
Accrued income
|
|
|
4,301
|
|
|
|
8,655
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
708,905
|
|
|
|
687,109
|
|
|
|
|
|
|
|
|
|
|
Due from related parties included in other accounts receivable, as of March 31, 2018 and December 31,
2017 are
W
630,881 million and
W
567,996 million, respectively.
113
5.
|
Receivables and Other Assets, Continued
|
|
(c)
|
The aging of trade accounts and note receivable, other accounts receivable and long-term
non-trade
receivable as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
|
Book value
|
|
|
Impairment loss
|
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable(*)
|
|
|
Long-term
non-trade
receivable
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable(*)
|
|
|
Long-term
non-trade
receivable
|
|
Not past due
|
|
W
|
3,766,617
|
|
|
|
702,577
|
|
|
|
7,258
|
|
|
|
(601
|
)
|
|
|
(395
|
)
|
|
|
(2
|
)
|
Past due
1-15
days
|
|
|
3,872
|
|
|
|
404
|
|
|
|
|
|
|
|
(28
|
)
|
|
|
(2
|
)
|
|
|
|
|
Past due 16-30 days
|
|
|
|
|
|
|
296
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
|
|
Past due
31-60
days
|
|
|
|
|
|
|
92
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Past due more than 60 days
|
|
|
|
|
|
|
6,412
|
|
|
|
|
|
|
|
|
|
|
|
(477
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,770,489
|
|
|
|
709,781
|
|
|
|
7,258
|
|
|
|
(629
|
)
|
|
|
(876
|
)
|
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Other accounts receivable includes
non-trade
receivable and accrued income.
|
114
5.
|
Receivables and Other Assets, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
December 31, 2017
|
|
|
|
Book value
|
|
|
Impairment loss
|
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable(*)
|
|
|
Long-term
non-trade
receivable
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable(*)
|
|
|
Long-term
non-trade
receivable
|
|
Not past due
|
|
W
|
4,673,660
|
|
|
|
686,837
|
|
|
|
15,115
|
|
|
|
(570
|
)
|
|
|
(686
|
)
|
|
|
|
|
Past due
1-15
days
|
|
|
341
|
|
|
|
482
|
|
|
|
|
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
Past due
16-30
days
|
|
|
135
|
|
|
|
53
|
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
|
|
|
Past due
31-60
days
|
|
|
|
|
|
|
207
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
|
|
|
Past due more than 60 days
|
|
|
4
|
|
|
|
622
|
|
|
|
|
|
|
|
|
|
|
|
(400
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
4,674,140
|
|
|
|
688,201
|
|
|
|
15,115
|
|
|
|
(570
|
)
|
|
|
(1,092
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The movement in the allowance for impairment in respect of trade accounts and notes receivable, other accounts receivable and
long-term
non-trade
receivable for the three-month periods ended March 31, 2018 and the year ended December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
2017
|
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable
|
|
|
Long-term
non-trade
receivable
|
|
|
Trade accounts
and notes
receivable
|
|
|
Other
accounts
receivable
|
|
|
Long-term
non-trade
receivable
|
|
Balance at the beginning of the period
|
|
W
|
570
|
|
|
|
1,092
|
|
|
|
|
|
|
|
520
|
|
|
|
804
|
|
|
|
23
|
|
(Reversal of) bad debt expense
|
|
|
59
|
|
|
|
(216
|
)
|
|
|
2
|
|
|
|
50
|
|
|
|
288
|
|
|
|
(23
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the reporting date
|
|
W
|
629
|
|
|
|
876
|
|
|
|
2
|
|
|
|
570
|
|
|
|
1,092
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
115
5.
|
Receivables and Other Assets, Continued
|
|
(d)
|
Other assets as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current assets
|
|
|
|
|
|
|
|
|
Advance payments
|
|
W
|
5,211
|
|
|
|
3,597
|
|
Prepaid expenses
|
|
|
225,130
|
|
|
|
76,129
|
|
Value added tax refundable
|
|
|
89,239
|
|
|
|
95,769
|
|
Emission rights
|
|
|
|
|
|
|
1,978
|
|
Right to recover returned goods(*)
|
|
|
6,923
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
326,503
|
|
|
|
177,473
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
|
|
|
Long-term prepaid expenses
|
|
W
|
333,567
|
|
|
|
333,995
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
333,567
|
|
|
|
333,995
|
|
|
|
|
|
|
|
|
|
|
(*)
|
As a result from the initial application of
K-IFRS
No. 1115, the Company recognized an asset for right to recover returned goods returned by the customer.
|
116
6.
|
Other Financial Assets
|
|
(a)
|
Other financial assets as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
(
In millions of won
)
|
|
March 31, 2018
|
|
Current assets
|
|
|
|
|
Financial Asset at Fair Value through
Other Comprehensive Income
|
|
|
|
|
Debt instrument
|
|
|
|
|
Government bonds
|
|
W
|
6
|
|
Financial Asset Carried at Amortized Cost
|
|
|
|
|
Short-term loans
|
|
W
|
11,701
|
|
|
|
|
|
|
Total
|
|
W
|
11,707
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Financial Asset at Fair Value through Profit or Loss
|
|
|
|
|
Equity instrument
|
|
|
|
|
Intellectual Discovery, Ltd.
|
|
W
|
729
|
|
Kyulux, Inc
|
|
|
1,968
|
|
|
|
|
|
|
Sub-Total
|
|
|
2,697
|
|
Convertible bonds
|
|
|
1,552
|
|
Derivatives(*)
|
|
|
600
|
|
Financial Asset at Fair Value through Other Comprehensive Income
|
|
|
|
|
Debt instrument
|
|
|
|
|
Government bonds
|
|
W
|
157
|
|
Financial Asset Carried at Amortized Cost
|
|
|
|
|
Deposits
|
|
W
|
13,757
|
|
Long-term loans
|
|
|
37,297
|
|
Long-term
non-trade
receivable
|
|
|
7,256
|
|
|
|
|
|
|
Total
|
|
W
|
63,316
|
|
|
|
|
|
|
(*)
|
Represents interest rate swap contracts related to borrowings with variable interest rate.
|
117
6.
|
Other Financial Assets, Continued
|
|
(ii)
|
As of December 31, 2017
|
|
|
|
|
|
(
In millions of won
)
|
|
December 31, 2017
|
|
Current assets
|
|
|
|
|
Available-for-sale
financial assets
|
|
|
|
|
Debt instrument
|
|
|
|
|
Government bonds
|
|
W
|
6
|
|
Short-term loans
|
|
|
13,493
|
|
|
|
|
|
|
Total
|
|
W
|
13,499
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
Financial Asset at Fair Value through Profit or Loss
|
|
W
|
1,552
|
|
Available-for-sale
financial
assets
|
|
|
|
|
Debt instrument
|
|
|
|
|
Government bonds
|
|
W
|
156
|
|
Equity instrument
|
|
|
|
|
Intellectual Discovery, Ltd.
|
|
W
|
729
|
|
Kyulux, Inc
|
|
|
1,968
|
|
|
|
|
|
|
Sub-Total
|
|
W
|
2,697
|
|
Deposits
|
|
W
|
13,638
|
|
Long-term loans
|
|
|
30,772
|
|
Long-term
non-trade
receivable
|
|
|
15,115
|
|
Derivatives(*)
|
|
|
842
|
|
|
|
|
|
|
Total
|
|
W
|
64,772
|
|
|
|
|
|
|
(*)
|
Represents interest rate swap contracts related to borrowings with variable interest rate.
|
Other financial assets of related parties as of March 31, 2018 and December 31, 2017 are
W
2,500 million and
W
2,750 million, respectively.
118
Inventories as of March 31, 2018 and December 31, 2017 are as
follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Finished goods
|
|
W
|
525,081
|
|
|
|
491,330
|
|
Work-in-process
|
|
|
685,694
|
|
|
|
675,324
|
|
Raw materials
|
|
|
306,989
|
|
|
|
286,934
|
|
Supplies
|
|
|
132,292
|
|
|
|
228,657
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,650,056
|
|
|
|
1,682,245
|
|
|
|
|
|
|
|
|
|
|
For the three-month periods ended March 31, 2018 and 2017, the amount of inventories recognized as cost
of sales, inventory write-downs and reversal and usage of inventory write-downs included in cost of sales are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
2017
|
|
Inventories recognized as cost of sales
|
|
W
|
4,902,524
|
|
|
|
5,218,933
|
|
Including: inventory write-downs
|
|
|
190,761
|
|
|
|
194,154
|
|
Including: reversal and usage of inventory write-downs
|
|
|
(184,139
|
)
|
|
|
(185,454
|
)
|
119
|
(a)
|
Investments in subsidiaries consist of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Overseas Subsidiaries
|
|
Location
|
|
|
Business
|
|
Percentage
of ownership
|
|
|
Book
value
|
|
|
Percentage
of ownership
|
|
|
Book
Value
|
|
LG Display America, Inc.
|
|
|
San Jose,
U.S.A.
|
|
|
Sell Display products
|
|
|
100
|
%
|
|
W
|
36,815
|
|
|
|
100
|
%
|
|
W
|
36,815
|
|
LG Display Germany GmbH
|
|
|
Eschborn,
Germany
|
|
|
Sell Display products
|
|
|
100
|
%
|
|
|
19,373
|
|
|
|
100
|
%
|
|
|
19,373
|
|
LG Display Japan Co., Ltd.
|
|
|
Tokyo, Japan
|
|
|
Sell Display products
|
|
|
100
|
%
|
|
|
15,686
|
|
|
|
100
|
%
|
|
|
15,686
|
|
LG Display Taiwan Co., Ltd.
|
|
|
Taipei, Taiwan
|
|
|
Sell Display products
|
|
|
100
|
%
|
|
|
35,230
|
|
|
|
100
|
%
|
|
|
35,230
|
|
LG Display Nanjing Co., Ltd.
|
|
|
Nanjing, China
|
|
|
Manufacture Display products
|
|
|
100
|
%
|
|
|
593,726
|
|
|
|
100
|
%
|
|
|
593,726
|
|
LG Display Shanghai Co., Ltd.
|
|
|
Shanghai, China
|
|
|
Sell Display products
|
|
|
100
|
%
|
|
|
9,093
|
|
|
|
100
|
%
|
|
|
9,093
|
|
LG Display Poland Sp. z o.o.
|
|
|
Wroclaw, Poland
|
|
|
Manufacture Display products
|
|
|
100
|
%
|
|
|
194,992
|
|
|
|
100
|
%
|
|
|
194,992
|
|
LG Display Guangzhou Co., Ltd.
|
|
|
Guangzhou,
China
|
|
|
Manufacture Display products
|
|
|
100
|
%
|
|
|
293,557
|
|
|
|
100
|
%
|
|
|
293,557
|
|
LG Display Shenzhen Co., Ltd.
|
|
|
Shenzhen, China
|
|
|
Sell Display products
|
|
|
100
|
%
|
|
|
3,467
|
|
|
|
100
|
%
|
|
|
3,467
|
|
LG Display Singapore Pte. Ltd.
|
|
|
Singapore
|
|
|
Sell Display products
|
|
|
100
|
%
|
|
|
1,250
|
|
|
|
100
|
%
|
|
|
1,250
|
|
L&T Display Technology (Fujian) Limited
|
|
|
Fujian,
China
|
|
|
Manufacture and sell LCD module and LCD monitor sets
|
|
|
51
|
%
|
|
|
10,123
|
|
|
|
51
|
%
|
|
|
10,123
|
|
LG Display Yantai Co., Ltd.
|
|
|
Yantai,
China
|
|
|
Manufacture Display products
|
|
|
100
|
%
|
|
|
169,195
|
|
|
|
100
|
%
|
|
|
169,195
|
|
Nanumnuri Co., Ltd.
|
|
|
Gumi, South
Korea
|
|
|
Janitorial services
|
|
|
100
|
%
|
|
|
800
|
|
|
|
100
|
%
|
|
|
800
|
|
LG Display (China) Co., Ltd.
|
|
|
Guangzhou,China
|
|
|
Manufacture and Sell Display products
|
|
|
51
|
%
|
|
|
723,086
|
|
|
|
51
|
%
|
|
|
723,086
|
|
Unified Innovative Technology, LLC
|
|
|
Wilmington,
U.S.A.
|
|
|
Manage intellectual property
|
|
|
100
|
%
|
|
|
9,489
|
|
|
|
100
|
%
|
|
|
9,489
|
|
LG Display Guangzhou Trading Co., Ltd.
|
|
|
Guangzhou,
China
|
|
|
Sell Display products
|
|
|
100
|
%
|
|
|
218
|
|
|
|
100
|
%
|
|
|
218
|
|
Global OLED Technology LLC
|
|
|
Herndon,
U.S.A
|
|
|
Manage OLED intellectual property
|
|
|
100
|
%
|
|
|
164,322
|
|
|
|
100
|
%
|
|
|
164,322
|
|
LG Display Vietnam Haiphong Co., Ltd.(*1)
|
|
|
Haiphong,
Vietnam
|
|
|
Manufacture Display Products
|
|
|
100
|
%
|
|
|
329,978
|
|
|
|
100
|
%
|
|
|
117,378
|
|
Suzhou Lehui Display Co., Ltd.
|
|
|
Suzhou,
China
|
|
|
Manufacture and sell LCD module and LCD monitor sets
|
|
|
100
|
%
|
|
|
121,640
|
|
|
|
100
|
%
|
|
|
121,640
|
|
Money Market Trust(*2)
|
|
|
Seoul,
South Korea
|
|
|
Money market trust
|
|
|
100
|
%
|
|
|
430,801
|
|
|
|
100
|
%
|
|
|
61,471
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,162,841
|
|
|
|
|
|
|
W
|
2,580,911
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
120
8.
|
Investments, Continued
|
(*1)
|
For the three-month period ended March 31, 2018, the Company contributed
W
212,600 million in cash for the capital increase of LG Display Vietnam Haiphong Co., Ltd.
(LGDVN). There was no change in the Companys ownership percentage in LGDVN as a result of this additional investment.
|
(*2)
|
For the three-month period ended March 31, 2018, the Company acquired and disposed Money Market Trust (MMT) and the MMT amount as of March 31, 2018 is
W
430,801 million.
|
|
(b)
|
Investments in associates consist of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Associates
|
|
Location
|
|
Business
|
|
Percentage
of ownership
|
|
|
Book
Value
|
|
|
Percentage
of ownership
|
|
|
Book
Value
|
|
Paju Electric Glass Co., Ltd.
|
|
Paju, South Korea
|
|
Manufacture electric glass for FPDs
|
|
|
40
|
%
|
|
W
|
45,089
|
|
|
|
40
|
%
|
|
W
|
45,089
|
|
INVENIA Co., Ltd.
|
|
Seongnam, South Korea
|
|
Develop and manufacture the equipment for FPDs
|
|
|
13
|
%
|
|
|
6,330
|
|
|
|
13
|
%
|
|
|
6,330
|
|
WooRee E&L Co., Ltd.
|
|
Ansan, South Korea
|
|
Manufacture LED back light unit packages
|
|
|
14
|
%
|
|
|
10,268
|
|
|
|
14
|
%
|
|
|
10,268
|
|
LB Gemini New
Growth Fund
No.16 (*1)
|
|
Seoul, South Korea
|
|
Invest in small and middle sized companies and benefit from M&A opportunities
|
|
|
31
|
%
|
|
|
434
|
|
|
|
31
|
%
|
|
|
434
|
|
YAS Co., Ltd.
|
|
Paju, South Korea
|
|
Develop and manufacture deposition equipment for OLEDs
|
|
|
15
|
%
|
|
|
10,000
|
|
|
|
15
|
%
|
|
|
10,000
|
|
AVATEC Co., Ltd.
|
|
Daegu, South Korea
|
|
Process and sell electric glass for FPDs
|
|
|
17
|
%
|
|
|
10,600
|
|
|
|
17
|
%
|
|
|
10,600
|
|
Arctic Sentinel, Inc.
|
|
Los Angeles, U.S.A.
|
|
Develop and manufacture tablet for kids
|
|
|
10
|
%
|
|
|
|
|
|
|
10
|
%
|
|
|
|
|
CYNORA Gmbh
|
|
Bruchsal, Germany
|
|
Develop organic emitting materials for displays and lighting devices
|
|
|
14
|
%
|
|
|
20,309
|
|
|
|
14
|
%
|
|
|
20,309
|
|
Material science(*2)
|
|
Seoul, South Korea
|
|
Develop, manufacture and sales OLED material
|
|
|
10
|
%
|
|
|
4,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
107,030
|
|
|
|
|
|
|
W
|
103,030
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
121
8.
|
Investments, Continued
|
(*1)
|
The Company is a member of a limited partnership in the LB Gemini New Growth Fund No.16 (the Fund). On the other hand, a resolution to dissolve the fund was approved at the general meeting and the fund is in
process of liquidation as of March 31, 2018.
|
(*2)
|
In March 2018, the Company invested
W
4,000 million and acquired 10,767 shares of common stock with voting rights in Material science. As of March 31, 2018, the Companys
ownership percentage in Material science is 10% and the Company has the right to appoint a director to the board of directors of the investee.
|
For the three-month periods ended March 31, 2018 and 2017, the aggregate amount of received dividends from subsidiaries and associates are
W
95,553 million and
W
8,639 million, respectively.
9.
|
Property, Plant and Equipment
|
For the three-month periods ended March 31, 2018 and
2017, the Company purchased property, plant and equipment of
W
1,656,048 million and
W
1,113,774 million, respectively. The capitalized borrowing costs and the annualized
capitalization rate were
W
18,633 million and 2.23%, and
W
6,260 million and 1.84% for the three-month periods ended March 31, 2018 and 2017, respectively. Also, for
the three-month periods ended March 31, 2018 and 2017, the Company disposed of property, plant and equipment with carrying amounts of
W
85,393 million and
W
20,785 million, respectively, and recognized
W
13,715 million and
W
3,826 million, respectively, as gain and loss on disposal of
property, plant and equipment for the three-month period ended March 31, 2018 (gain and loss for the three-month period ended March 31, 2017:
W
30,314 million and
W
1,957 million, respectively).
|
(a)
|
The Company capitalizes expenditures related to development activities, such as expenditures incurred on designing, manufacturing and testing of products after those related activities meet the capitalization criteria
of development costs including technical feasibility, future economic benefits and others. The balances of capitalized development costs as of March 31, 2018 and December 31, 2017, are
W
316,914 million and
W
296,760 million, respectively.
|
|
(b)
|
Development of new projects are divided into research activities and development activities. Expenditures on research activities are recognized in profit or loss and development expenditures are capitalized,
respectively.
|
122
11.
|
Financial Liabilities
|
|
(a)
|
Financial liabilities as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current
|
|
|
|
|
|
|
|
|
Current portion of long-term borrowings and bonds
|
|
W
|
1,478,132
|
|
|
|
1,058,985
|
|
Current portion of Payment guarantee liabilities
|
|
|
2,153
|
|
|
|
1,750
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,480,285
|
|
|
|
1,060,735
|
|
|
|
|
|
|
|
|
|
|
Non-current
|
|
|
|
|
|
|
|
|
Won denominated borrowings
|
|
W
|
1,701,096
|
|
|
|
1,251,258
|
|
Foreign currency denominated borrowings
|
|
|
149,310
|
|
|
|
401,775
|
|
Bonds
|
|
|
1,894,864
|
|
|
|
1,506,003
|
|
Payment guarantee liabilities
|
|
|
7,073
|
|
|
|
6,377
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,752,343
|
|
|
|
3,165,413
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Won denominated long-term borrowings as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
Lender
|
|
Annual interest rate as of
March 31, 2018 (%)
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
Woori Bank
|
|
3-year
Korean Treasury Bond
rate - 1.25, 2.75
|
|
W
|
1,753
|
|
|
|
1,922
|
|
Shinhan Bank
|
|
CD rate (91days) + 0.30
|
|
|
200,000
|
|
|
|
200,000
|
|
Korea Development Bank and others
|
|
CD rate (91days) + 0.64~0.74,
2.28~3.25
|
|
|
2,050,000
|
|
|
|
1,250,000
|
|
Less current portion of long-term borrowings
|
|
|
|
|
(550,657
|
)
|
|
|
(200,664
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,701,096
|
|
|
|
1,251,258
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c)
|
Foreign currency denominated long-term borrowings as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won and USD
)
|
|
|
|
|
|
|
Lender
|
|
Annual interest rate as of
March 31, 2018 (%)(*)
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
The Export-Import Bank of Korea and Others
|
|
3ML+0.55 ~1.04
|
|
W
|
751,883
|
|
|
|
755,337
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency equivalent
|
|
|
|
USD
|
705
|
|
|
USD
|
705
|
|
|
|
|
|
|
|
|
|
|
|
|
Less current portion of long-term borrowings
|
|
|
|
|
(602,573
|
)
|
|
|
(353,562
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
149,310
|
|
|
|
401,775
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
ML represents Month LIBOR (London Inter-Bank Offered Rates)
|
123
11.
|
Financial Liabilities, Continued
|
|
(d)
|
Details of bonds issued and outstanding as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won
)
|
|
|
|
|
|
|
|
|
|
|
|
Maturity
|
|
Annual interest
rate as of
March 31, 2018 (%)
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
Won denominated bonds(*)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Publicly issued bonds
|
|
May 2018 ~ February 2023
|
|
|
1.73~3.73
|
|
|
W
|
2,225,000
|
|
|
|
2,015,000
|
|
Less discount on bonds
|
|
|
|
|
|
|
|
|
(5,234
|
)
|
|
|
(4,238
|
)
|
Less current portion
|
|
|
|
|
|
|
|
|
(324,902
|
)
|
|
|
(504,759
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,894,864
|
|
|
|
1,506,003
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Principal of the won denominated bonds is to be repaid at maturity and interests are paid quarterly.
|
124
The Companys defined benefit plans provide a
lump-sum
payment to an employee based on final salary rates and length of service at the time the employee leaves the Company.
The defined benefit plans expose the Company to actuarial risks, such as the risk associated with expected periods of service, interest rate
risk, market (investment) risk, and others.
|
(a)
|
Net defined benefit liabilities recognized as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Present value of partially funded defined benefit obligations
|
|
W
|
1,593,210
|
|
|
|
1,560,525
|
|
Fair value of plan assets
|
|
|
(1,443,253
|
)
|
|
|
(1,465,990
|
)
|
|
|
|
|
|
|
|
|
|
|
|
W
|
149,957
|
|
|
|
94,535
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Expenses recognized in profit or loss for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Current service cost
|
|
W
|
51,109
|
|
|
|
48,615
|
|
Net interest cost
|
|
|
242
|
|
|
|
598
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
51,351
|
|
|
|
49,213
|
|
|
|
|
|
|
|
|
|
|
|
(c)
|
Plan assets as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Guaranteed deposits in banks
|
|
W
|
1,443,253
|
|
|
|
1,465,990
|
|
As of March 31, 2018, the Company maintains the plan assets primarily with Mirae Asset Daewoo Co., Ltd.,
Shinhan Bank and others.
|
(d)
|
Remeasurements of the net defined benefit liabilities (assets) included in other comprehensive income (loss) for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
2017
|
|
Remeasurements of the net defined benefit liabilities
|
|
W
|
(6,419
|
)
|
|
|
(4,725
|
)
|
Tax effect
|
|
|
2,296
|
|
|
|
1,143
|
|
|
|
|
|
|
|
|
|
|
Remeasurements of the net defined benefit liabilities, net of income tax
|
|
W
|
(4,123
|
)
|
|
|
(3,582
|
)
|
|
|
|
|
|
|
|
|
|
125
13.
|
Provisions and Other Liabilities
|
|
(a)
|
Changes in provisions for the three-month period ended March 31, 2018 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Litigations and
claims
|
|
|
Warranties (*)
|
|
|
Others
|
|
|
Total
|
|
Balance at January 1, 2018
|
|
W
|
43
|
|
|
|
100,119
|
|
|
|
1,835
|
|
|
|
101,997
|
|
Adjustment from adoption of
K-IFRS
1115
|
|
|
|
|
|
|
|
|
|
|
9,789
|
|
|
|
9,789
|
|
Additions (reversals)
|
|
|
|
|
|
|
29,340
|
|
|
|
(3,834
|
)
|
|
|
25,506
|
|
Usage
|
|
|
|
|
|
|
(42,956
|
)
|
|
|
|
|
|
|
(42,956
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at March 31, 2018
|
|
W
|
43
|
|
|
|
86,503
|
|
|
|
7,790
|
|
|
|
94,336
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
|
|
W
|
43
|
|
|
|
63,868
|
|
|
|
7,790
|
|
|
|
71,701
|
|
Non-current
|
|
W
|
|
|
|
|
22,635
|
|
|
|
|
|
|
|
22,635
|
|
(*)
|
The provision for warranties covers defective products and is normally applicable for 18 months from the date of purchase. The warranty liability is calculated by using historical and anticipated rates of warranty
claims, and costs per claim to satisfy the Companys warranty obligation.
|
|
(b)
|
Other liabilities as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
Withholdings
|
|
W
|
26,375
|
|
|
|
23,948
|
|
Unearned revenues
|
|
|
7,916
|
|
|
|
9,566
|
|
Security deposits
|
|
|
3,230
|
|
|
|
|
|
Dividends payable
|
|
|
178,908
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
216,429
|
|
|
|
33,514
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities
|
|
|
|
|
|
|
|
|
Long-term accrued expenses
|
|
W
|
75,191
|
|
|
|
66,956
|
|
Security deposits
|
|
|
2,545
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
77,736
|
|
|
|
66,956
|
|
|
|
|
|
|
|
|
|
|
126
14.
|
Contingencies and Commitments
|
Anti-trust litigations
Argos Limited and affiliated companies (Argos) filed a Notice of Claim against the Company and LG Display Taiwan Co., Ltd. in the
High Court of Justice in London alleging infringement of Treaty on the Functioning of the European Union and Agreement on the European Economic Area. Prior to Argos filing of Particulars of Claim and service, the Company and LG Display Taiwan
Co., Ltd. reached a settlement in principle with Argos in December 2017. The parties expect to execute a settlement agreement in 2018.
Others
The Company
is defending against various claims in addition to pending proceedings described above. The Company does not have a present obligation for these matters and has not recognized any provision at March 31, 2018.
Factoring and securitization of accounts receivable
The Company has agreements with Korea Development Bank and several other banks for accounts receivable sales negotiating facilities of up to an
aggregate of USD 1,743 million (
W
1,859,421 million) in connection with the Companys export sales transactions with its subsidiaries. As of March 31, 2018, no short-term borrowings were outstanding in
connection with these agreements. In connection with all of the contracts in this paragraph, the Company has sold its accounts receivable with recourse.
The Company has a credit facility agreement with Shinhan Bank and several other banks pursuant to which the Company could sell its accounts
receivables up to an aggregate of
W
345,960 million in connection with its domestic and export sales transactions and, as of March 31, 2018, no accounts and notes receivable sold to Shinhan Bank were outstanding
in connection with the agreement. In connection with the contract above, the Company has sold its accounts receivable without recourse.
Letters of credit
As of March 31, 2018, the Company has agreements in relation to the opening of letters of credit up to USD 30 million
(
W
31,995 million) with KEB Hana Bank, USD 80 million (
W
85,320 million) with Bank of China and USD 50 million (
W
53,325 million) with
Sumitomo Mitsui Banking Corporation.
Payment guarantees
The Company provides a payment guarantee in connection with the term loan credit facilities of LG Display Vietnam Haiphong, Co., Ltd. amounting
to USD 595 million (
W
634,568 million) for principals.
In addition, the Company obtained payment
guarantees amounting to USD 900 million (
W
959,850 million) from KEB Hana Bank and others for advances received related to the long-term supply agreements and USD 8.5 million
(
W
9,065 million) from Shinhan bank for value added tax payments in Poland.
127
14.
|
Contingencies and Commitments, Continued
|
License agreements
As of March 31, 2018, in relation to its LCD business, the Company has technical license agreements with Hitachi Display, Ltd. and others
and has a trademark license agreement with LG Corp.
Long-term supply agreement
As of March 31, 2018, in connection with long-term supply agreements with customers, the Company recognized USD 900 million
(
W
959,850 million) in advances received. The advances received will be offset against outstanding accounts receivable balances after a given period of time, as well as those arising from the supply of products
thereafter. The Company received payment guarantees amounting to USD 900 million (
W
959,850 million) from KEB Hana Bank and other various banks relating to advances received.
The Company is authorized to issue 500,000,000 shares of capital stock
(par value
W
5,000), and as of March 31, 2018 and December 31, 2017, the number of issued common shares is 357,815,700. There have been no changes in the capital stock from January 1, 2017 to
March 31, 2018.
Details of revenue for the three-month periods ended March 31, 2018 and
2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Sales of goods
|
|
W
|
5,144,426
|
|
|
|
6,528,896
|
|
Royalties
|
|
|
3,726
|
|
|
|
4,600
|
|
Others
|
|
|
6,109
|
|
|
|
9,451
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
5,154,261
|
|
|
|
6,542,947
|
|
|
|
|
|
|
|
|
|
|
128
17.
|
The Nature of Expenses and Others
|
The classification of expenses by nature for the
three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Changes in inventories
|
|
W
|
32,189
|
|
|
|
100,076
|
|
Purchases of raw materials, merchandise and others
|
|
|
1,986,586
|
|
|
|
2,362,566
|
|
Depreciation and amortization
|
|
|
573,450
|
|
|
|
490,619
|
|
Outsourcing fees
|
|
|
1,338,767
|
|
|
|
1,363,182
|
|
Labor costs
|
|
|
696,245
|
|
|
|
633,135
|
|
Supplies and others
|
|
|
191,168
|
|
|
|
208,206
|
|
Utility
|
|
|
179,812
|
|
|
|
169,395
|
|
Fees and commissions
|
|
|
140,527
|
|
|
|
117,361
|
|
Shipping costs
|
|
|
27,308
|
|
|
|
27,174
|
|
Advertising
|
|
|
14,929
|
|
|
|
44,489
|
|
Warranty expenses
|
|
|
29,340
|
|
|
|
68,177
|
|
Travel
|
|
|
24,024
|
|
|
|
16,487
|
|
Taxes and dues
|
|
|
15,772
|
|
|
|
12,396
|
|
Others
|
|
|
163,529
|
|
|
|
176,967
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
5,413,646
|
|
|
|
5,790,230
|
|
|
|
|
|
|
|
|
|
|
Total expenses consist of cost of sales, selling, administrative, research and development expenses and other
non-operating
expenses, excluding foreign exchange differences.
129
18.
|
Selling and Administrative Expenses
|
|
Details
|
of selling and administrative expenses for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Salaries
|
|
W
|
62,795
|
|
|
|
53,096
|
|
Expenses related to defined benefit plans
|
|
|
7,034
|
|
|
|
6,555
|
|
Other employee benefits
|
|
|
12,081
|
|
|
|
14,648
|
|
Shipping costs
|
|
|
20,554
|
|
|
|
21,626
|
|
Fees and commissions
|
|
|
27,365
|
|
|
|
30,973
|
|
Depreciation
|
|
|
26,424
|
|
|
|
22,725
|
|
Taxes and dues
|
|
|
793
|
|
|
|
314
|
|
Advertising
|
|
|
14,929
|
|
|
|
44,489
|
|
Warranty expenses
|
|
|
29,340
|
|
|
|
68,177
|
|
Rent
|
|
|
2,638
|
|
|
|
2,507
|
|
Insurance
|
|
|
1,535
|
|
|
|
1,361
|
|
Travel
|
|
|
4,550
|
|
|
|
4,559
|
|
Training
|
|
|
2,201
|
|
|
|
3,167
|
|
Others
|
|
|
11,629
|
|
|
|
10,510
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
223,868
|
|
|
|
284,707
|
|
|
|
|
|
|
|
|
|
|
|
Details
|
of personnel expenses for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Salaries and wages
|
|
W
|
598,556
|
|
|
|
535,368
|
|
Other employee benefits
|
|
|
92,072
|
|
|
|
77,293
|
|
Contributions to National Pension plan
|
|
|
18,807
|
|
|
|
17,917
|
|
Expenses related to defined benefit plan
|
|
|
51,351
|
|
|
|
49,213
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
760,786
|
|
|
|
679,791
|
|
|
|
|
|
|
|
|
|
|
130
20.
|
Other
Non-operating
Income and Other
Non-operating
Expenses
|
|
(a)
|
Details of other
non-operating
income for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Foreign currency gain
|
|
W
|
100,719
|
|
|
|
269,086
|
|
Gain on disposal of property, plant and equipment
|
|
|
13,715
|
|
|
|
30,314
|
|
Gain on disposal of intangible assets
|
|
|
239
|
|
|
|
|
|
Reversal of impairment loss on intangible assets
|
|
|
130
|
|
|
|
|
|
Rental income
|
|
|
448
|
|
|
|
869
|
|
Others
|
|
|
1,753
|
|
|
|
3,892
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
117,004
|
|
|
|
304,161
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Details of other
non-operating
expenses for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Foreign currency loss
|
|
W
|
106,651
|
|
|
|
483,257
|
|
Loss on disposal of property, plant and equipment
|
|
|
3,826
|
|
|
|
1,957
|
|
Impairment loss on intangible assets
|
|
|
37
|
|
|
|
1,689
|
|
Donations
|
|
|
1,850
|
|
|
|
2,364
|
|
Other bad debt expense
|
|
|
4
|
|
|
|
46
|
|
Expenses related to legal proceedings or claims and others
|
|
|
47
|
|
|
|
238
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
112,415
|
|
|
|
489,551
|
|
|
|
|
|
|
|
|
|
|
131
21.
|
Finance Income and Finance Costs
|
|
(a)
|
Finance income and costs recognized in profit and loss for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Finance income
|
|
|
|
|
|
|
|
|
Interest income
|
|
W
|
4,783
|
|
|
|
6,038
|
|
Dividend income
|
|
|
95,553
|
|
|
|
8,639
|
|
Foreign currency gain
|
|
|
4,807
|
|
|
|
87,210
|
|
Gain on disposal of investments
|
|
|
|
|
|
|
5,083
|
|
Gain on transaction of derivatives
|
|
|
36
|
|
|
|
|
|
Gain on valuation of derivatives
|
|
|
|
|
|
|
798
|
|
Others
|
|
|
516
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
105,695
|
|
|
|
107,768
|
|
|
|
|
|
|
|
|
|
|
Finance costs
|
|
|
|
|
|
|
|
|
Interest expense
|
|
W
|
10,987
|
|
|
|
15,922
|
|
Foreign currency loss
|
|
|
4,966
|
|
|
|
16,470
|
|
Loss on transaction of derivatives
|
|
|
38
|
|
|
|
101
|
|
Loss on valuation of derivatives
|
|
|
242
|
|
|
|
|
|
Others
|
|
|
677
|
|
|
|
350
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
16,910
|
|
|
|
32,843
|
|
|
|
|
|
|
|
|
|
|
132
|
(a)
|
Details of income tax expense for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Current tax expense
|
|
W
|
(9,304
|
)
|
|
|
96,105
|
|
Deferred tax expense (benefit)
|
|
|
(70,579
|
)
|
|
|
38,329
|
|
|
|
|
|
|
|
|
|
|
Income tax expense (benefit)
|
|
W
|
(79,883
|
)
|
|
|
134,434
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Deferred Tax Assets and Liabilities
|
Deferred tax assets are reviewed at each reporting date
and are reduced to the extent that it is no longer probable that the deferred tax assets at the reporting date will be realized with the Companys estimated future taxable income.
Deferred tax assets and liabilities as of March 31, 2018 and December 31, 2017 are attributable to the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Assets
|
|
|
Liabilities
|
|
|
Total
|
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
Other accounts receivable, net
|
|
W
|
|
|
|
|
|
|
|
|
(816
|
)
|
|
|
(1,378
|
)
|
|
|
(816
|
)
|
|
|
(1,378
|
)
|
Inventories, net
|
|
|
33,282
|
|
|
|
30,688
|
|
|
|
|
|
|
|
|
|
|
|
33,282
|
|
|
|
30,688
|
|
Defined benefit liabilities, net
|
|
|
18,232
|
|
|
|
2,375
|
|
|
|
|
|
|
|
|
|
|
|
18,232
|
|
|
|
2,375
|
|
Accrued expenses
|
|
|
106,786
|
|
|
|
179,112
|
|
|
|
|
|
|
|
|
|
|
|
106,786
|
|
|
|
179,112
|
|
Property, plant and equipment
|
|
|
179,672
|
|
|
|
206,900
|
|
|
|
|
|
|
|
|
|
|
|
179,672
|
|
|
|
206,900
|
|
Intangible assets
|
|
|
856
|
|
|
|
1,249
|
|
|
|
|
|
|
|
|
|
|
|
856
|
|
|
|
1,249
|
|
Provisions
|
|
|
23,371
|
|
|
|
27,018
|
|
|
|
|
|
|
|
|
|
|
|
23,371
|
|
|
|
27,018
|
|
Gain or loss on foreign currency translation, net
|
|
|
13
|
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
13
|
|
|
|
13
|
|
Others
|
|
|
11,714
|
|
|
|
12,345
|
|
|
|
|
|
|
|
|
|
|
|
11,714
|
|
|
|
12,345
|
|
Tax losses
|
|
|
104,339
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
104,339
|
|
|
|
|
|
Tax credit carryforwards
|
|
|
322,674
|
|
|
|
268,926
|
|
|
|
|
|
|
|
|
|
|
|
322,674
|
|
|
|
268,926
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax assets (liabilities)
|
|
W
|
800,939
|
|
|
|
728,626
|
|
|
|
(816
|
)
|
|
|
(1,378
|
)
|
|
|
800,123
|
|
|
|
727,248
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Statutory tax rate applicable to the Company was 24.2% for the year ended December 31, 2017. During the
year-ended December 31, 2017, certain amendments to income tax rules in Korea were enacted and effective on January 1, 2018 that resulted in application of 27.5% for taxable income in excess of
W
300,000 million. Deferred taxes as of
December 31, 2017 and March 31, 2018 have been measured using the applicable tax rates from the amendment.
133
23.
|
Earnings (Loss) Per Share
|
|
(a)
|
Basic earnings (loss) per share for the three-month periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
(In won and No. of shares)
|
|
2018
|
|
|
2017
|
|
Profit (Loss) for the period
|
|
W
|
(80,364,446,331
|
)
|
|
|
514,111,732,552
|
|
Weighted-average number of common stocks outstanding
|
|
|
357,815,700
|
|
|
|
357,815,700
|
|
|
|
|
|
|
|
|
|
|
Earnings (Loss) per share
|
|
W
|
(225
|
)
|
|
|
1,437
|
|
|
|
|
|
|
|
|
|
|
For the three-month periods ended March 31, 2018 and 2017, there were no events or transactions that
resulted in changes in the number of common stocks used for calculating earnings (loss) per share.
|
(b)
|
Diluted earnings (loss) per share for the three-month periods ended March 31, 2018 and 2017 are not calculated since there was no potential common stock.
|
134
24.
|
Financial Risk Management
|
The Company is exposed to credit risk, liquidity risk and
market risks. The Company identifies and analyzes such risks, and controls are implemented under a risk management system to monitor and manage these risks at below a threshold level.
Market risk is the risk that changes in market prices, such as foreign exchange
rates, interest rates and equity prices will affect the Companys income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters,
while optimizing the return.
The Company is exposed to currency risk on sales, purchases and borrowings that
are denominated in a currency other than the functional currency of the Company, Korean won (KRW). The currencies in which these transactions primarily are denominated are USD, JPY, etc.
Interest on borrowings is denominated in the currency of the borrowing. Generally, borrowings are denominated in currencies that match the
cash flows generated by the underlying operations of the Company, primarily KRW and USD.
In respect of other monetary assets and
liabilities denominated in foreign currencies, the Company adopts policies to ensure that its net exposure is kept to an acceptable level by buying or selling foreign currencies at spot rates when necessary to address short-term imbalances.
|
i)
|
Exposure to currency risk
|
The Companys exposure to foreign currency risk based on
notional amounts as of March 31, 2018 and December 31, 2017 is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
|
March 31, 2018
|
|
|
|
USD
|
|
|
JPY
|
|
|
CNY
|
|
|
PLN
|
|
|
EUR
|
|
Cash and cash equivalents
|
|
|
118
|
|
|
|
658
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
Trade accounts and notes receivable
|
|
|
3,138
|
|
|
|
3,050
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-trade
receivable
|
|
|
80
|
|
|
|
788
|
|
|
|
3,358
|
|
|
|
|
|
|
|
1
|
|
Trade accounts and notes payable
|
|
|
(1,196
|
)
|
|
|
(12,162
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Other accounts payable
|
|
|
(97
|
)
|
|
|
(14,768
|
)
|
|
|
(733
|
)
|
|
|
(10
|
)
|
|
|
(1
|
)
|
Debt
|
|
|
(705
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net exposure
|
|
|
1,338
|
|
|
|
(22,434
|
)
|
|
|
2,625
|
|
|
|
(8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
135
24.
|
Financial Risk Management, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
|
December 31, 2017
|
|
|
|
USD
|
|
|
JPY
|
|
|
CNY
|
|
|
PLN
|
|
|
EUR
|
|
Cash and cash equivalents
|
|
|
482
|
|
|
|
77
|
|
|
|
|
|
|
|
2
|
|
|
|
|
|
Trade accounts and notes receivable
|
|
|
3,840
|
|
|
|
1,960
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-trade
receivable
|
|
|
73
|
|
|
|
1,674
|
|
|
|
1,085
|
|
|
|
|
|
|
|
9
|
|
Trade accounts and notes payable
|
|
|
(1,337
|
)
|
|
|
(13,659
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Other accounts payable
|
|
|
(170
|
)
|
|
|
(12,582
|
)
|
|
|
(1,059
|
)
|
|
|
(10
|
)
|
|
|
(2
|
)
|
Debt
|
|
|
(705
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net exposure
|
|
|
2,183
|
|
|
|
(22,530
|
)
|
|
|
26
|
|
|
|
(8
|
)
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average exchange rates applied for the three-month periods ended March 31, 2018 and 2017 and the exchange
rates at March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In won)
|
|
Average rate
|
|
|
Reporting date spot rate
|
|
|
|
2018
|
|
|
2017
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
USD
|
|
W
|
1,072.66
|
|
|
|
1,154.65
|
|
|
|
1,066.50
|
|
|
|
1,071.40
|
|
JPY
|
|
|
9.90
|
|
|
|
10.15
|
|
|
|
10.01
|
|
|
|
9.49
|
|
CNY
|
|
|
168.62
|
|
|
|
168.15
|
|
|
|
169.68
|
|
|
|
163.65
|
|
PLN
|
|
|
315.20
|
|
|
|
284.48
|
|
|
|
311.79
|
|
|
|
306.07
|
|
EUR
|
|
|
1,317.33
|
|
|
|
1,230.16
|
|
|
|
1,311.95
|
|
|
|
1,279.25
|
|
136
24.
|
Financial Risk Management, Continued
|
A weaker won, as indicated below, against the following currencies which
comprise the Companys assets or liabilities denominated in foreign currency as of March 31, 2018 and December 31, 2017, would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis is based on
foreign currency exchange rate variances that the Company considers to be reasonably possible as of the end of reporting period. The analysis assumes that all other variables, in particular interest rates, would remain constant. The changes in
equity and profit or loss would have been as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
|
Equity
|
|
|
Profit
or loss
|
|
|
Equity
|
|
|
Profit
or loss
|
|
USD (5 percent weakening)
|
|
W
|
51,728
|
|
|
|
51,728
|
|
|
|
88,643
|
|
|
|
88,643
|
|
JPY (5 percent weakening)
|
|
|
(8,144
|
)
|
|
|
(8,144
|
)
|
|
|
(8,104
|
)
|
|
|
(8,104
|
)
|
CNY (5 percent weakening)
|
|
|
16,146
|
|
|
|
16,146
|
|
|
|
161
|
|
|
|
161
|
|
PLN (5 percent weakening)
|
|
|
(90
|
)
|
|
|
(90
|
)
|
|
|
(93
|
)
|
|
|
(93
|
)
|
EUR (5 percent weakening)
|
|
|
|
|
|
|
|
|
|
|
339
|
|
|
|
339
|
|
A stronger won against the above currencies as of March 31, 2018 and December 31, 2017 would have
had the equal but opposite effect on the above currencies to the amounts shown above, on the basis that all other variables remain constant.
137
24.
|
Financial Risk Management, Continued
|
Interest rate risk arises principally from the Companys debentures
and borrowings. The Company establishes and applies its policy to reduce uncertainty arising from fluctuations in the interest rate and to minimize finance cost and manages interest rate risk by monitoring of trends of fluctuations in interest rate
and establishing plan for countermeasures.
The interest rate profile of the Companys interest-bearing financial instruments
as of March 31, 2018 and December 31, 2017 is as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Fixed rate instruments
|
|
|
|
|
|
|
|
|
Financial assets
|
|
W
|
812,186
|
|
|
|
1,147,340
|
|
Financial liabilities
|
|
|
(3,971,512
|
)
|
|
|
(2,962,671
|
)
|
|
|
|
|
|
|
|
|
|
|
|
W
|
(3,159,326
|
)
|
|
|
(1,815,331
|
)
|
|
|
|
|
|
|
|
|
|
Variable rate instruments
|
|
|
|
|
|
|
|
|
Financial liabilities
|
|
W
|
(1,251,890
|
)
|
|
|
(1,255,350
|
)
|
|
ii)
|
Equity and profit or loss sensitivity analysis for variable rate instruments
|
As of
March 31, 2018 and December 31, 2017, a change of 100 basis points in interest rates at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below for each
12-month
period following the reporting dates. This analysis assumes that all other variables, in particular foreign currency rates, remain constant.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
Profit or loss
|
|
|
|
1%p
increase
|
|
|
1%p
decrease
|
|
|
1%p
increase
|
|
|
1%p
decrease
|
|
March 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable rate instruments(*)
|
|
W
|
(6,539
|
)
|
|
|
6,539
|
|
|
|
(6,539
|
)
|
|
|
6,539
|
|
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable rate instruments(*)
|
|
W
|
(6,863
|
)
|
|
|
6,863
|
|
|
|
(6,863
|
)
|
|
|
6,863
|
|
(*)
|
Financial instruments subject to interest rate swap not qualified for hedging are excluded.
|
138
24.
|
Financial Risk Management, Continued
|
Credit risk is the risk of financial loss to the Company if a customer or
counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Companys receivables from customers.
The Companys exposure to credit risk of trade and other receivables is influenced mainly by the individual characteristics of each
customer. However, management believes that the demographics of the Companys customer base, including the default risk of the country in which customers operate, do not have a significant influence on credit risk since the majority of the
customers are global electronic appliance manufacturers operating in global markets.
The Company establishes credit limits for each
customer and each new customer is analyzed quantitatively and qualitatively before determining whether to utilize third party guarantees, insurance or factoring as appropriate.
In relation to the impairment of financial assets, the Company recognizes expected credit loss and its changes at each reporting date
subsequent to initial recognition of financial asset according to an expected credit loss impairment model.
The Company does not establish
allowances for receivables under insurance or receivables from customers with a high credit rating. Trade accounts and notes receivables are insured in order to manage credit risk and uninsured trade accounts and notes receivables are managed in
accordance with the Companys management policy.
The carrying amount of financial assets represents the maximum credit exposure. The
maximum exposure to credit risk as of March 31, 2018 and December 31, 2017 are as follows:
139
24.
|
Financial Risk Management, Continued
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
|
Carrying amounts
|
|
Financial Assets Carried at Amortized Cost
|
|
|
|
|
Cash and cash equivalents
|
|
W
|
434,823
|
|
Deposits in banks
|
|
|
377,211
|
|
Trade accounts and notes receivable
|
|
|
3,769,860
|
|
Non-trade
receivable
|
|
|
704,604
|
|
Accrued income
|
|
|
4,301
|
|
Deposits
|
|
|
13,757
|
|
Short-term loans
|
|
|
11,701
|
|
Long-term
loans
|
|
|
37,297
|
|
Long-term
non-trade
receivable
|
|
|
7,256
|
|
|
|
|
|
|
Sub-Total
|
|
|
5,360,810
|
|
Financial Assets at Fair Value through Profit or Loss
|
|
|
|
|
Convertible bonds
|
|
|
1,552
|
|
Derivatives
|
|
|
600
|
|
|
|
|
|
|
Sub-Total
|
|
|
2,152
|
|
Financial Assets at Fair Value through Other Comprehensive Income
|
|
|
|
|
Debt instrument
|
|
|
163
|
|
|
|
|
|
|
Total
|
|
|
5,363,125
|
|
|
|
|
|
|
(*)
|
Excluded from disclosures as the carrying amount approximates fair value.
|
|
ii)
|
As of December 31, 2017
|
|
|
|
|
|
(In millions of won)
|
|
December 31, 2017
|
|
|
|
Carrying amounts
|
|
Cash and cash equivalents
|
|
W
|
566,408
|
|
Deposits in banks
|
|
|
580,781
|
|
Trade accounts and notes receivable
|
|
|
4,673,570
|
|
Non-trade
receivable
|
|
|
678,454
|
|
Accrued income
|
|
|
8,655
|
|
Available-for-sale
financial assets
|
|
|
162
|
|
Financial assets at fair value through profit or loss
|
|
|
1,552
|
|
Deposits
|
|
|
13,638
|
|
Short-term loans
|
|
|
13,493
|
|
Long-term
loans
|
|
|
30,772
|
|
Long-term
non-trade
receivable
|
|
|
15,115
|
|
Derivatives
|
|
|
842
|
|
|
|
|
|
|
Total
|
|
|
6,583,442
|
|
|
|
|
|
|
In addition to the financial assets above, as of March 31, 2018, the Company provides a payment guarantee
of USD 595 million (
W
634,568 million), for its subsidiary.
140
24.
|
Financial Risk Management, Continued
|
Liquidity risk is the risk that the Company will encounter difficulty in
meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Companys approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Companys reputation.
The Company has historically been able to satisfy its cash requirements from cash flows from operations and debt and equity financing. To the
extent that the Company does not generate sufficient cash flows from operations to meet its capital requirements, the Company may rely on other financing activities, such as external long-term borrowings and offerings of debt instruments,
equity-linked and other debt instruments. In addition, the Company maintains a line of credit with various banks.
The following are the
contractual maturities of financial liabilities, including estimated interest payments, as of March 31, 2018.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
Contractual cash flows
|
|
|
|
Carrying
amount
|
|
|
Total
|
|
|
6 months
or less
|
|
|
6-12
months
|
|
|
1-2
years
|
|
|
2-5
years
|
|
|
More than
5 years
|
|
Non-derivative
financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unsecured bank borrowings
|
|
W
|
3,003,636
|
|
|
|
3,187,977
|
|
|
|
361,140
|
|
|
|
867,529
|
|
|
|
271,090
|
|
|
|
1,659,716
|
|
|
|
28,502
|
|
Unsecured bond issues
|
|
|
2,219,766
|
|
|
|
2,365,526
|
|
|
|
236,301
|
|
|
|
139,176
|
|
|
|
599,441
|
|
|
|
1,390,608
|
|
|
|
|
|
Trade accounts and notes payable
|
|
|
2,507,732
|
|
|
|
2,507,732
|
|
|
|
2,507,732
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other accounts payable
|
|
|
2,816,545
|
|
|
|
2,816,545
|
|
|
|
2,816,545
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payment guarantee(*)
|
|
|
9,226
|
|
|
|
702,639
|
|
|
|
8,991
|
|
|
|
25,281
|
|
|
|
49,985
|
|
|
|
515,140
|
|
|
|
103,242
|
|
Security deposits
|
|
|
5,775
|
|
|
|
5,775
|
|
|
|
3,145
|
|
|
|
85
|
|
|
|
2,545
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
10,562,680
|
|
|
|
11,586,194
|
|
|
|
5,933,854
|
|
|
|
1,032,071
|
|
|
|
923,061
|
|
|
|
3,565,464
|
|
|
|
131,744
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Contractual cash flows of payment guarantee is identical to timing of principal payment and represent the maximum amount that the Company could be required to pay the guarantee amount.
|
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different
amounts.
141
24.
|
Financial Risk Management, Continued
|
Managements policy is to maintain a capital base so as to maintain
investor, creditor and market confidence and to sustain future development of the business. Liabilities to equity ratio, net borrowings to equity ratio and other financial ratios are used by management to achieve an optimal capital structure.
Management also monitors the return on capital as well as the level of dividends to ordinary shareholders.
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Total liabilities
|
|
W
|
12,587,679
|
|
|
|
11,580,156
|
|
Total equity
|
|
|
13,565,864
|
|
|
|
13,829,259
|
|
Cash and deposits in banks (*1)
|
|
|
812,023
|
|
|
|
1,147,178
|
|
Borrowings (including bonds)
|
|
|
5,223,402
|
|
|
|
4,218,021
|
|
Total liabilities to equity ratio
|
|
|
93
|
%
|
|
|
84
|
%
|
Net borrowings to equity ratio (*2)
|
|
|
33
|
%
|
|
|
22
|
%
|
(*1)
|
Cash and deposits in banks consist of cash and cash equivalents and current deposits in banks.
|
(*2)
|
Net borrowings to equity ratio is calculated by dividing total borrowings (including bonds) less cash and current deposits in banks by total equity.
|
142
24.
|
Financial Risk Management, Continued
|
|
(e)
|
Determination of fair value
|
|
(i)
|
Measurement of fair value
|
A number of the Companys accounting policies and disclosures
require the determination of fair value, for both financial and
non-financial
assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods.
When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.
|
i)
|
Current Assets and Liabilities
|
The carrying amounts approximate fair value because of the
short maturity of these instruments.
|
ii)
|
Trade Receivables and Other Receivables
|
The fair value of trade and other receivables is
estimated as the present value of future cash flows, discounted at the market rate of interest at the reporting date. This fair value is determined for disclosure purposes. The carrying amounts of short-term receivables approximate fair value.
|
iii)
|
Investments in Equity and Debt Instruments
|
Marketable financial assets at fair value through
profit or loss and at fair value through other comprehensive income are determined by reference to their quoted closing bid price at the reporting date. The fair value of
non-marketable
instruments is
determined using valuation methods.
|
iv)
|
Non-derivative
Financial Liabilities
|
Fair value, which
is determined for disclosure purposes, except for the liabilities at FVTPL, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date.
143
24.
|
Financial Risk Management, Continued
|
|
(ii)
|
Fair values versus carrying amounts
|
The fair values of financial assets and liabilities,
together with the carrying amounts shown in the condensed separate interim statements of financial position as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
March 31, 2018
|
|
|
|
Carrying
amounts
|
|
|
Fair
Values
|
|
Financial Assets Carried at Amortized Cost
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
W
|
434,823
|
|
|
|
(*
|
)
|
Deposits in banks
|
|
|
377,211
|
|
|
|
(*
|
)
|
Trade accounts and notes receivable
|
|
|
3,769,860
|
|
|
|
(*
|
)
|
Non-trade
receivable
|
|
|
704,604
|
|
|
|
(*
|
)
|
Accrued income
|
|
|
4,301
|
|
|
|
(*
|
)
|
Deposits
|
|
|
13,757
|
|
|
|
(*
|
)
|
Short-term loans
|
|
|
11,701
|
|
|
|
(*
|
)
|
Long-term
loans
|
|
|
37,297
|
|
|
|
(*
|
)
|
Long-term
non-trade
receivable
|
|
|
7,256
|
|
|
|
(*
|
)
|
Financial Assets at Fair Value through Profit or Loss
|
|
|
|
|
|
|
|
|
Equity instrument
|
|
W
|
2,697
|
|
|
|
2,697
|
|
Convertible bonds
|
|
|
1,552
|
|
|
|
1,552
|
|
Derivatives
|
|
|
600
|
|
|
|
600
|
|
Financial Assets at Fair Value through Other Comprehensive Income
|
|
|
|
|
|
|
|
|
Debt instrument
|
|
W
|
163
|
|
|
|
163
|
|
Liabilities carried at amortized cost
|
|
|
|
|
|
|
|
|
Unsecured bank borrowings
|
|
|
3,003,636
|
|
|
|
3,014,852
|
|
Unsecured bond issues
|
|
|
2,219,766
|
|
|
|
2,225,927
|
|
Trade accounts and notes payable
|
|
|
2,507,732
|
|
|
|
(*
|
)
|
Other accounts payable
|
|
|
2,816,545
|
|
|
|
2,816,678
|
|
Long-term other accounts payable
|
|
|
9,226
|
|
|
|
(*
|
)
|
Security deposits
|
|
|
5,775
|
|
|
|
(*
|
)
|
(*)
|
Excluded from disclosures as the carrying amount approximates fair value.
|
144
24.
|
Financial Risk Management, Continued
|
|
ii)
|
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
|
|
|
December 31, 2017
|
|
|
|
Carrying
amounts
|
|
|
Fair
Values
|
|
Assets carried at fair value
|
|
|
|
|
|
|
|
|
Available-for-sale
financial assets
|
|
W
|
162
|
|
|
|
162
|
|
Financial asset at fair value through profit or loss
|
|
|
1,552
|
|
|
|
1,552
|
|
Derivatives
|
|
|
842
|
|
|
|
842
|
|
Assets carried at amortized cost
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
W
|
566,408
|
|
|
|
(*
|
)
|
Deposits in banks
|
|
|
580,781
|
|
|
|
(*
|
)
|
Trade accounts and notes receivable
|
|
|
4,673,570
|
|
|
|
(*
|
)
|
Non-trade
receivable
|
|
|
678,454
|
|
|
|
(*
|
)
|
Accrued income
|
|
|
8,655
|
|
|
|
(*
|
)
|
Deposits
|
|
|
13,638
|
|
|
|
(*
|
)
|
Short-term loans
|
|
|
13,493
|
|
|
|
(*
|
)
|
Long-term
loans
|
|
|
30,772
|
|
|
|
(*
|
)
|
Long-term
non-trade
receivable
|
|
|
15,115
|
|
|
|
(*
|
)
|
Liabilities carried at amortized cost
|
|
|
|
|
|
|
|
|
Unsecured bank borrowings
|
|
W
|
2,207,259
|
|
|
|
2,212,474
|
|
Unsecured bond issues
|
|
|
2,010,762
|
|
|
|
2,016,086
|
|
Trade accounts and notes payable
|
|
|
2,391,493
|
|
|
|
(*
|
)
|
Other accounts payable
|
|
|
2,701,823
|
|
|
|
2,702,033
|
|
Long-term other accounts payable
|
|
|
8,127
|
|
|
|
(*
|
)
|
(*)
|
Excluded from disclosures as the carrying amount approximates fair value.
|
145
24.
|
Financial Risk Management, Continued
|
|
(iii)
|
Fair values of financial assets and liabilities
|
The table below analyzes financial instruments carried at fair value
based on the input variables used in the valuation method to measure fair value of assets and liabilities. The different levels have been defined as follows:
|
|
|
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
|
|
|
|
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly
|
|
|
|
Level 3: inputs for the asset or liability that are not based on observable market data
|
146
24.
|
Financial Risk Management, Continued
|
|
ii)
|
Financial instruments measured at fair value
|
Fair value hierarchy classifications of the
financial instruments that are measured at fair value as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
March 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Asset at Fair Value through Profit or Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity instrument
|
|
W
|
|
|
|
|
|
|
|
|
2,697
|
|
|
|
2,697
|
|
Convertible bonds
|
|
|
|
|
|
|
|
|
|
|
1,552
|
|
|
|
1,552
|
|
Derivatives
|
|
|
|
|
|
|
|
|
|
|
600
|
|
|
|
600
|
|
Financial Asset at Fair Value through Other Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt instrument
|
|
|
163
|
|
|
|
|
|
|
|
|
|
|
|
163
|
|
|
|
|
|
|
(In millions of won)
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale
financial assets
|
|
W
|
162
|
|
|
|
|
|
|
|
|
|
|
|
162
|
|
Financial assets at fair value through profit or loss
|
|
|
|
|
|
|
|
|
|
|
1,552
|
|
|
|
1,552
|
|
Derivatives
|
|
|
|
|
|
|
|
|
|
|
842
|
|
|
|
842
|
|
147
24.
|
Financial Risk Management, Continued
|
|
iii)
|
Financial instruments not measured at fair value but for which the fair value is disclosed
|
Fair value hierarchy classifications, valuation technique and inputs for fair value measurements of the financial instruments not measured at
fair value but for which the fair value is disclosed as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
March 31, 2018
|
|
|
Valuation
technique
|
|
|
Input
|
|
Classification
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unsecured bank borrowings
|
|
W
|
|
|
|
|
|
|
|
|
3,014,852
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Unsecured bond issues
|
|
|
|
|
|
|
|
|
|
|
2,225,927
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Other accounts payable
|
|
|
|
|
|
|
|
|
|
|
2,816,678
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
|
|
|
|
(
In millions of won
)
|
|
December 31, 2017
|
|
|
Valuation
technique
|
|
|
Input
|
|
Classification
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unsecured bank borrowings
|
|
W
|
|
|
|
|
|
|
|
|
2,212,474
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Unsecured bond issues
|
|
|
|
|
|
|
|
|
|
|
2,016,086
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
Other accounts payable
|
|
|
|
|
|
|
|
|
|
|
2,702,033
|
|
|
|
Discounted
cash flow
|
|
|
|
Discount rate
|
|
|
iv)
|
The interest rates applied for determination of the above fair value as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
Debentures, loans and others
|
|
1.52~2.95%
|
|
1.57~2.92%
|
148
25.
|
Changes in liabilities arising from financing activities
|
Changes in liabilities arising
from financing activities for the three-month period ended March 31, 2018 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
Non-cash
transactions
|
|
|
|
|
|
|
January 1,
2018
|
|
|
Cash flows from
financing activities
|
|
|
Dividends
declared
|
|
|
Reclassification
|
|
|
Exchange
rate effect
|
|
|
Effective
interest
adjustment
|
|
|
Others
|
|
|
March 31,
2018
|
|
Current portion of long-term borrowings and bonds
|
|
W
|
1,058,985
|
|
|
|
(180,169
|
)
|
|
|
|
|
|
|
601,942
|
|
|
|
(2,769
|
)
|
|
|
143
|
|
|
|
|
|
|
|
1,478,132
|
|
Payment Guarantee
|
|
|
8,127
|
|
|
|
519
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
580
|
|
|
|
9,226
|
|
Long-term borrowings
|
|
|
1,653,033
|
|
|
|
800,000
|
|
|
|
|
|
|
|
(601,942
|
)
|
|
|
(685
|
)
|
|
|
|
|
|
|
|
|
|
|
1,850,406
|
|
Bonds
|
|
|
1,506,003
|
|
|
|
388,447
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
414
|
|
|
|
|
|
|
|
1,894,864
|
|
Dividends payable
|
|
|
|
|
|
|
|
|
|
|
178,908
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
178,908
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
4,226,148
|
|
|
|
1,008,797
|
|
|
|
178,908
|
|
|
|
|
|
|
|
(3,454
|
)
|
|
|
557
|
|
|
|
580
|
|
|
|
5,411,536
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
149
26.
|
Related Parties and Others
|
Related parties as of March 31, 2018 are as follows:
|
|
|
Classification
|
|
Description
|
Subsidiaries(*)
|
|
LG Display America, Inc. and others
|
Associates(*)
|
|
Paju Electric Glass Co., Ltd. and others
|
Subsidiaries of Associates
|
|
AVATEC Electronics Yantai Co., Ltd. and others
|
Entity that has significant influence over the Company
|
|
LG Electronics Inc.
|
Subsidiaries of the entity that has significant influence over the Company
|
|
Subsidiaries of LG Electronics Inc.
|
(*)
|
Details of subsidiaries and associates are described in note 8.
|
150
26.
|
Related Parties and Others, Continued
|
|
(b)
|
Significant transactions such as sales of goods and purchases of raw material and outsourcing service and others, which occurred in the normal course of business with related parties for the three-month periods ended
March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property,
plant and
equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display America, Inc.
|
|
W
|
2,148,447
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Japan Co., Ltd.
|
|
|
436,684
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,151
|
|
LG Display Germany GmbH
|
|
|
425,156
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
329
|
|
LG Display Taiwan Co., Ltd.
|
|
|
341,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
171
|
|
LG Display Nanjing Co., Ltd.
|
|
|
4,865
|
|
|
|
|
|
|
|
268
|
|
|
|
|
|
|
|
262,288
|
|
|
|
1,385
|
|
LG Display Shanghai Co., Ltd.
|
|
|
223,520
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10
|
|
LG Display Poland Sp. z o.o.
|
|
|
141
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,589
|
|
|
|
2
|
|
LG Display Guangzhou Co., Ltd.
|
|
|
5,449
|
|
|
|
|
|
|
|
2,579
|
|
|
|
|
|
|
|
441,631
|
|
|
|
3,468
|
|
LG Display Shenzhen Co., Ltd.
|
|
|
388,276
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Yantai Co., Ltd.
|
|
|
7,659
|
|
|
|
|
|
|
|
5,480
|
|
|
|
|
|
|
|
395,945
|
|
|
|
5,543
|
|
LG Display (China) Co., Ltd.
|
|
|
|
|
|
|
90,281
|
|
|
|
359,221
|
|
|
|
|
|
|
|
|
|
|
|
424
|
|
LG Display Singapore Pte. Ltd.
|
|
|
194,264
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13
|
|
L&T Display Technology (Fujian) Limited
|
|
|
82,017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8
|
|
|
|
5
|
|
Nanumnuri Co., Ltd.
|
|
|
45
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,123
|
|
Global OLED Technology LLC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,494
|
|
LG Display Guangzhou Trading Co., Ltd.
|
|
|
89,520
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Vietnam Haiphong Co., Ltd.
|
|
|
35,740
|
|
|
|
|
|
|
|
4,165
|
|
|
|
|
|
|
|
111,669
|
|
|
|
69
|
|
Suzhou Lehui Display Co., Ltd.
|
|
|
35,723
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
4,418,718
|
|
|
|
90,281
|
|
|
|
371,713
|
|
|
|
|
|
|
|
1,221,130
|
|
|
|
21,187
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
151
26.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property,
plant and
equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
Associates and their subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WooRee E&L Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
47
|
|
INVENIA Co., Ltd.
|
|
|
|
|
|
|
30
|
|
|
|
270
|
|
|
|
7,749
|
|
|
|
|
|
|
|
72
|
|
AVATEC Co., Ltd.
|
|
|
|
|
|
|
530
|
|
|
|
|
|
|
|
|
|
|
|
17,773
|
|
|
|
119
|
|
Paju Electric Glass Co., Ltd.
|
|
|
|
|
|
|
4,172
|
|
|
|
92,497
|
|
|
|
|
|
|
|
|
|
|
|
920
|
|
LB Gemini New Growth Fund No.16
|
|
|
|
|
|
|
540
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YAS Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
760
|
|
|
|
12,417
|
|
|
|
|
|
|
|
794
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
|
|
|
|
5,272
|
|
|
|
93,527
|
|
|
|
20,166
|
|
|
|
17,773
|
|
|
|
1,952
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entity that has significant influence over the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics Inc.
|
|
W
|
361,044
|
|
|
|
|
|
|
|
10,186
|
|
|
|
152,490
|
|
|
|
|
|
|
|
17,466
|
|
Subsidiaries of the entity that has significant influence over the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics India Pvt. Ltd.
|
|
W
|
8,355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13
|
|
LG Electronics Vietnam Haiphong Co., Ltd.
|
|
|
32,988
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2
|
|
LG Electronics Reynosa S.A. DE C.V.
|
|
|
4,843
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
898
|
|
LG Electronics Almaty Kazakhstan
|
|
|
2,425
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8
|
|
LG Electronics S.A. (Pty) Ltd
|
|
|
2,397
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2
|
|
LG Electronics Mexicalli S.A.DE C.V.
|
|
|
1,281
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
54
|
|
LG Electronics RUS, LLC
|
|
|
603
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
320
|
|
152
26.
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2018
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property,
plant and
equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
Subsidiaries of the entity that has significant influence over the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Innotek Co., Ltd.
|
|
W
|
6,950
|
|
|
|
|
|
|
|
34,626
|
|
|
|
|
|
|
|
|
|
|
|
11,082
|
|
LG Hitachi Water Solutions Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
117,814
|
|
|
|
|
|
|
|
491
|
|
Inspur LG Digital Mobile Communications Co., Ltd.
|
|
|
12,177
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qingdao LG Inspur Digital Communication Co., Ltd.
|
|
|
7,656
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HiEntech Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,935
|
|
Others
|
|
|
730
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,913
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
80,405
|
|
|
|
|
|
|
|
34,626
|
|
|
|
117,814
|
|
|
|
|
|
|
|
22,718
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
4,860,167
|
|
|
|
95,553
|
|
|
|
510,052
|
|
|
|
290,470
|
|
|
|
1,238,903
|
|
|
|
63,323
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
153
26.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2017
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property,
plant and
equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display America, Inc.
|
|
W
|
2,771,857
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Japan Co., Ltd.
|
|
|
564,061
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12
|
|
LG Display Germany GmbH
|
|
|
518,689
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,913
|
|
LG Display Taiwan Co., Ltd.
|
|
|
410,048
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
351
|
|
LG Display Nanjing Co., Ltd.
|
|
|
3,509
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
116,663
|
|
|
|
|
|
LG Display Shanghai Co., Ltd.
|
|
|
335,235
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25
|
|
LG Display Poland Sp. z o.o.
|
|
|
1,746
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,408
|
|
|
|
31
|
|
LG Display Guangzhou Co., Ltd.
|
|
|
18,436
|
|
|
|
|
|
|
|
1,831
|
|
|
|
|
|
|
|
599,453
|
|
|
|
2,803
|
|
LG Display Shenzhen Co., Ltd.
|
|
|
427,984
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
|
LG Display Yantai Co., Ltd.
|
|
|
6,292
|
|
|
|
|
|
|
|
4,594
|
|
|
|
|
|
|
|
528,656
|
|
|
|
9,099
|
|
LG Display (China) Co., Ltd.
|
|
|
11,823
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
216,106
|
|
|
|
|
|
LG Display Singapore Pte. Ltd.
|
|
|
293,412
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3
|
|
L&T Display Technology (Fujian) Limited
|
|
|
103,199
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12
|
|
|
|
295
|
|
Nanumnuri Co., Ltd.
|
|
|
24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,620
|
|
Global OLED Technology LLC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,477
|
|
LG Display Guangzhou Trading Co., Ltd.
|
|
|
140,155
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display Vietnam Haiphong Co., Ltd.
|
|
|
112
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Suzhou Lehui Display Co., Ltd.
|
|
|
51,214
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
5,657,796
|
|
|
|
|
|
|
|
6,425
|
|
|
|
|
|
|
|
1,469,298
|
|
|
|
27,630
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
154
26.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2017
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property,
plant and
equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
Associates and their subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New Optics Ltd.(*)
|
|
W
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
6
|
|
WooRee E&L Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
76
|
|
INVENIA Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
454
|
|
|
|
2,758
|
|
|
|
|
|
|
|
111
|
|
AVATEC Co., Ltd.
|
|
|
|
|
|
|
530
|
|
|
|
|
|
|
|
|
|
|
|
19,816
|
|
|
|
251
|
|
Paju Electric Glass Co., Ltd.
|
|
|
|
|
|
|
8,109
|
|
|
|
98,763
|
|
|
|
|
|
|
|
|
|
|
|
1,097
|
|
Narenanotech Corporation(*)
|
|
|
|
|
|
|
|
|
|
|
226
|
|
|
|
10,453
|
|
|
|
|
|
|
|
169
|
|
YAS Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
829
|
|
|
|
19,208
|
|
|
|
|
|
|
|
392
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1
|
|
|
|
8,639
|
|
|
|
100,272
|
|
|
|
32,419
|
|
|
|
19,820
|
|
|
|
2,102
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entity that has significant influence over the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics Inc.
|
|
W
|
472,705
|
|
|
|
|
|
|
|
7,046
|
|
|
|
186,346
|
|
|
|
|
|
|
|
35,053
|
|
Subsidiaries of the entity that has significant influence over the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics India Pvt. Ltd.
|
|
W
|
22,276
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29
|
|
LG Electronics Vietnam Haiphong Co., Ltd.
|
|
|
52,956
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
37
|
|
LG Electronics Reynosa S.A. DE C.V.
|
|
|
36,801
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
325
|
|
LG Electronics Almaty Kazakhstan
|
|
|
4,043
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics S.A. (Pty) Ltd
|
|
|
5,182
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3
|
|
LG Electronics Mexicalli S.A.DE C.V.
|
|
|
14,190
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
51
|
|
LG Electronics RUS, LLC
|
|
|
1,283
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
286
|
|
155
26.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
2017
|
|
|
|
|
|
|
|
|
|
Purchase and others
|
|
|
|
Sales
and others
|
|
|
Dividend
income
|
|
|
Purchase of raw
material and
others
|
|
|
Acquisition of
property,
plant and
equipment
|
|
|
Outsourcing
fees
|
|
|
Other costs
|
|
Subsidiaries of the entity that has significant influence over the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Innotek Co., Ltd.
|
|
W
|
4,274
|
|
|
|
|
|
|
|
41,118
|
|
|
|
|
|
|
|
|
|
|
|
3,143
|
|
LG Hitachi Water Solutions Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
26,898
|
|
|
|
|
|
|
|
|
|
Inspur LG Digital Mobile Communications Co., Ltd.
|
|
|
39,544
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Qingdao LG Inspur Digital Communication Co., Ltd.
|
|
|
15,634
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HiEntech Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,982
|
|
Others
|
|
|
1,589
|
|
|
|
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
1,713
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
197,772
|
|
|
|
|
|
|
|
41,121
|
|
|
|
26,898
|
|
|
|
|
|
|
|
12,569
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
6,328,274
|
|
|
|
8,639
|
|
|
|
154,864
|
|
|
|
245,663
|
|
|
|
1,489,118
|
|
|
|
77,354
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Represents transactions occurred prior to disposal of the entire investments.
|
156
26.
Related Parties and Others, Continued
|
(c)
|
Trade accounts and notes receivable and payable as of March 31, 2018 and December 31, 2017 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
Trade accounts and notes receivable
and others
|
|
|
Trade accounts and notes payable and
others
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Display America, Inc.
|
|
W
|
1,264,899
|
|
|
|
1,795,757
|
|
|
|
|
|
|
|
|
|
LG Display Japan Co., Ltd.
|
|
|
232,634
|
|
|
|
230,804
|
|
|
|
4
|
|
|
|
2
|
|
LG Display Germany GmbH
|
|
|
358,991
|
|
|
|
497,677
|
|
|
|
3
|
|
|
|
|
|
LG Display Taiwan Co., Ltd.
|
|
|
493,476
|
|
|
|
436,943
|
|
|
|
98
|
|
|
|
106
|
|
LG Display Nanjing Co., Ltd.
|
|
|
4,792
|
|
|
|
176
|
|
|
|
164,908
|
|
|
|
85,646
|
|
LG Display Shanghai Co., Ltd.
|
|
|
149,239
|
|
|
|
176,816
|
|
|
|
1
|
|
|
|
74
|
|
LG Display Poland Sp. z o.o.
|
|
|
136
|
|
|
|
73
|
|
|
|
6,375
|
|
|
|
5,480
|
|
LG Display Guangzhou Co., Ltd.
|
|
|
358,089
|
|
|
|
345,212
|
|
|
|
63,987
|
|
|
|
189,996
|
|
LG Display Guangzhou Trading Co., Ltd.
|
|
|
111,195
|
|
|
|
88,876
|
|
|
|
|
|
|
|
|
|
LG Display Shenzhen Co., Ltd.
|
|
|
97,444
|
|
|
|
217,542
|
|
|
|
|
|
|
|
|
|
LG Display Yantai Co., Ltd.
|
|
|
127,269
|
|
|
|
123,059
|
|
|
|
216,296
|
|
|
|
30,397
|
|
LG Display (China) Co., Ltd.
|
|
|
85,149
|
|
|
|
55,309
|
|
|
|
133,109
|
|
|
|
150,933
|
|
LG Display Singapore Pte. Ltd.
|
|
|
200,285
|
|
|
|
187,420
|
|
|
|
5
|
|
|
|
1
|
|
L&T Display Technology (Fujian) Limited
|
|
|
53,716
|
|
|
|
57,545
|
|
|
|
164,976
|
|
|
|
177,487
|
|
Nanumnuri Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
2,397
|
|
|
|
2,453
|
|
LG Display Vietnam Haiphong Co., Ltd.
|
|
|
44,482
|
|
|
|
9,119
|
|
|
|
138,042
|
|
|
|
58,666
|
|
Suzhou Lehui Display Co., Ltd.
|
|
|
22,608
|
|
|
|
21,110
|
|
|
|
27,783
|
|
|
|
36,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,604,404
|
|
|
|
4,243,438
|
|
|
|
917,984
|
|
|
|
738,160
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
157
26.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
Trade accounts and notes receivable
and others
|
|
|
Trade accounts and notes payable and
others
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Associates and their subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WooRee E&L Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
52
|
|
|
|
61
|
|
INVENIA Co., Ltd.
|
|
|
2,280
|
|
|
|
2,375
|
|
|
|
8,817
|
|
|
|
18,523
|
|
AVATEC Co., Ltd.
|
|
|
530
|
|
|
|
|
|
|
|
4,682
|
|
|
|
2,949
|
|
Paju Electric Glass Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
64,375
|
|
|
|
60,141
|
|
YAS Co., Ltd.
|
|
|
250
|
|
|
|
375
|
|
|
|
16,700
|
|
|
|
6,474
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
3,060
|
|
|
|
2,750
|
|
|
|
94,626
|
|
|
|
88,148
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Entity that has significant influence over the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Electronics Inc.
|
|
W
|
400,849
|
|
|
|
550,101
|
|
|
|
202,405
|
|
|
|
206,616
|
|
158
26.
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
|
|
Trade accounts and notes receivable
and others
|
|
|
Trade accounts and notes payable and
others
|
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
Subsidiaries of the entity that has significant influence over the Company
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LG Innotek Co., Ltd.
|
|
W
|
4,266
|
|
|
|
407
|
|
|
|
55,586
|
|
|
|
58,741
|
|
LG Hitachi Water Solutions Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
210,998
|
|
|
|
154,079
|
|
HiEntech Co., Ltd.
|
|
|
|
|
|
|
|
|
|
|
5,672
|
|
|
|
4,854
|
|
Inspur LG Digital Mobile Communications Co., Ltd.
|
|
|
12,111
|
|
|
|
20,953
|
|
|
|
|
|
|
|
|
|
LG Electronics Reynosa S.A. DE C.V.
|
|
|
3,948
|
|
|
|
11,494
|
|
|
|
154
|
|
|
|
82
|
|
LG Electronics India Pvt. Ltd.
|
|
|
5,751
|
|
|
|
3,030
|
|
|
|
5
|
|
|
|
|
|
LG Electronics Vietnam Haiphong Co., Ltd.
|
|
|
25,033
|
|
|
|
36,017
|
|
|
|
1
|
|
|
|
1
|
|
LG Electronics S.A. (Pty) Ltd
|
|
|
2,326
|
|
|
|
2,400
|
|
|
|
2
|
|
|
|
4
|
|
Qingdao LG Inspur Digital Communication Co., Ltd.
|
|
|
5,140
|
|
|
|
9
|
|
|
|
|
|
|
|
80
|
|
Others
|
|
|
3,911
|
|
|
|
18,385
|
|
|
|
1,139
|
|
|
|
1,309
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
62,486
|
|
|
|
92,695
|
|
|
|
273,557
|
|
|
|
219,150
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
4,070,799
|
|
|
|
4,888,984
|
|
|
|
1,488,572
|
|
|
|
1,252,074
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
159
26.
|
Related Parties and Others, Continued
|
|
(d)
|
Details of significant cash transactions such as loans and collection of loans, which occurred in the normal course of business with related parties for three-month periods ended March 31, 2018 and 2017 are as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
|
|
2018
|
|
|
2017
|
|
Associates
|
|
Loans
|
|
|
Collection
of loans
|
|
|
Loans
|
|
|
Collection
of loans
|
|
INVENIA Co., Ltd.
|
|
W
|
|
|
|
|
125
|
|
|
|
|
|
|
|
83
|
|
YAS Co., Ltd.
|
|
|
|
|
|
|
125
|
|
|
|
|
|
|
|
83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
|
|
|
|
250
|
|
|
|
|
|
|
|
166
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
160
26.
|
Related Parties and Others, Continued
|
|
(e)
|
Conglomerate Transactions
|
Transactions, trade accounts and notes receivable and payable, and
others between the Company and certain companies and their subsidiaries, which are included in LG Group, one of conglomerates according to the Monopoly Regulation and Fair Trade Act for the three-month periods ended March 31, 2018 and 2017 and
as of March 31, 2018 and December 31, 2017 are as follows. These entities are not affiliates according to
K-IFRS
No. 1024,
Related Party Disclosures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
For the three-month period ended
March 31, 2018
|
|
|
March 31, 2018
|
|
|
|
Sales
and others
|
|
|
Purchase and
others
|
|
|
Trade accounts and
notes receivable
and others
|
|
|
Trade accounts and
notes payable and
others
|
|
LG International Corp.and its subsidiaries
|
|
W
|
184,257
|
|
|
|
264,777
|
|
|
|
131,321
|
|
|
|
191,030
|
|
LG Uplus Corp.
|
|
|
|
|
|
|
223
|
|
|
|
|
|
|
|
33
|
|
LG Chem Ltd. and its subsidiaries
|
|
|
1,564
|
|
|
|
193,552
|
|
|
|
6,067
|
|
|
|
114,821
|
|
Serveone Co., Ltd. and its subsidiaries
|
|
|
97
|
|
|
|
336,299
|
|
|
|
21,543
|
|
|
|
497,437
|
|
Silicon Works Co., Ltd.
|
|
|
|
|
|
|
143,295
|
|
|
|
|
|
|
|
148,397
|
|
LG Corp.
|
|
|
|
|
|
|
12,791
|
|
|
|
6,794
|
|
|
|
6,951
|
|
LG Management Development Institute
|
|
|
|
|
|
|
2,813
|
|
|
|
3,480
|
|
|
|
607
|
|
LG CNS Co., Ltd. and its subsidiaries
|
|
|
|
|
|
|
30,771
|
|
|
|
|
|
|
|
34,145
|
|
LG Hausys Ltd.
|
|
|
1,110
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
G2R Inc. and its subsidiaries
|
|
|
|
|
|
|
4,041
|
|
|
|
|
|
|
|
5,301
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
187,028
|
|
|
|
988,563
|
|
|
|
169,205
|
|
|
|
998,722
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
161
26.
|
Related Parties and Others, Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In millions of won)
|
|
For the three-month period ended
March 31, 2017
|
|
|
December 31, 2017
|
|
|
|
Sales
and others
|
|
|
Purchase and
others
|
|
|
Trade accounts and
notes receivable
and others
|
|
|
Trade accounts and
notes payable and
others
|
|
LG International Corp.and its subsidiaries
|
|
W
|
130,914
|
|
|
|
277,908
|
|
|
|
110,786
|
|
|
|
186,799
|
|
LG Household & Health Care, Ltd. and its subsidiaries
|
|
|
1
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
LG Uplus Corp.
|
|
|
51
|
|
|
|
185
|
|
|
|
|
|
|
|
1,505
|
|
LG Chem Ltd. and its subsidiaries
|
|
|
5
|
|
|
|
205,512
|
|
|
|
8,659
|
|
|
|
127,416
|
|
SK Siltron Co., Ltd. ( formerly, Siltron Co., Ltd.)(*)
|
|
|
10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lusem Co., Ltd.(*)
|
|
|
5
|
|
|
|
499
|
|
|
|
1
|
|
|
|
53
|
|
Serveone Co., Ltd. and its subsidiaries
|
|
|
115
|
|
|
|
281,368
|
|
|
|
21,565
|
|
|
|
491,719
|
|
Silicon Works Co., Ltd.
|
|
|
|
|
|
|
147,017
|
|
|
|
|
|
|
|
120,031
|
|
LG Corp.
|
|
|
|
|
|
|
15,699
|
|
|
|
4,700
|
|
|
|
1,523
|
|
LG Management Development Institute
|
|
|
|
|
|
|
2,009
|
|
|
|
3,480
|
|
|
|
699
|
|
LG CNS Co., Ltd. and its subsidiaries
|
|
|
37
|
|
|
|
22,183
|
|
|
|
|
|
|
|
90,374
|
|
LG Hausys Ltd.
|
|
|
418
|
|
|
|
44
|
|
|
|
|
|
|
|
374
|
|
G2R Inc. and its subsidiaries
|
|
|
|
|
|
|
829
|
|
|
|
|
|
|
|
14,275
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
131,556
|
|
|
|
953,254
|
|
|
|
149,191
|
|
|
|
1,034,768
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*)
|
Represents transactions occurred prior to disposal of the entire investments.
|
162
26.
|
Related Parties and Others, Continued
|
|
(f)
|
Key management personnel compensation
|
Compensation costs of key management for the three-month
periods ended March 31, 2018 and 2017 are as follows:
|
|
|
|
|
|
|
|
|
(
In millions of won
)
|
|
|
|
|
|
|
|
|
2018
|
|
|
2017
|
|
Short-term benefits
|
|
W
|
888
|
|
|
|
1,317
|
|
Expenses related to the defined benefit plan
|
|
|
273
|
|
|
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
W
|
1,161
|
|
|
|
1,410
|
|
|
|
|
|
|
|
|
|
|
Key management refers to the registered directors who have significant control and responsibilities over the
Companys operations and business.
|
(a)
|
In April 2018, the Company received advances from a customer amounting to USD 300 million (
W
320,670 million) in aggregate in connection with long-term supply agreements. The
advances received will be offset against outstanding accounts receivable balances after a given period of time, as well as those arising from the sale of products thereafter. The Company received a payment guarantee from the Export-Import Bank of
Korea amounting to USD 300 million (
W
320,670 million) relating to advances received.
|
|
(b)
|
In April 2018, LG Display Vietnam Haiphong, Co., Ltd. take out the term loan credit facilities, and the Company provides a payment guarantee in connection with that term loan amounting to USD 200 million
(
W
214,740 million) for principals.
|
163
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
|
|
|
|
|
|
|
LG Display Co., Ltd.
|
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
Date: May 15, 2018
|
|
By:
|
|
/s/ Heeyeon Kim
|
|
|
|
|
|
|
|
(Signature)
|
|
|
|
|
|
Name:
|
|
Heeyeon Kim
|
|
|
Title:
|
|
Head of IR / Vice President
|
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