LG 1999 Annual Report Download - page 6

4
0
Letter to Our Shareholders
_We of LG Electronics are indebted to our customers and shareholders for the encouragement and unsparing support they have
shown us.
_1999 was the year the digital wind blew with hurricane force all over the world. It had been rising for several years, but few
had forecast that it would sweep the world economy with such power. It was indeed a digital revolution, comparable to the
industrial revolution. And it is still accelerating, overthrowing the vested order of the world. Many entrepreneurs sense what is
coming and are surging into the digital revolution. Others are awed and some indisposed to face the new reality. As the old
paradigm wanes and the new one waxes, all must constantly innovate, even if only to stand still.
_1999 was a good year for us. For years we have spurred on innovation companywide and from top to bottom and fostered
craftsmanship in digitalware. We declared to the world that 1999 was the Year of Digital LG. Our digital odyssey was launched
and under full sail.
_The outcome of our digital management in 1999 encouraged us to stay with the Digital LG vision. Despite the unfavorable
climate we took in revenues of
￦
10,546 billion, a 7% increase, and our net income rocketed to
￦
2,005 billion, a 1,690%
increase.
_This growth rate means a lot to us because it is the payoff for our efforts to transform ourselves. Our R&D results were
overwhelming in fiscal 1999. We developed core technologies for digital TVs and plasma display panels (PDPs), which are full of
promise for further technological advancement. Our HD-1 chip, 60" PDP TV, 8X CD-RW, 8X DVD-ROM, 60" wide LCD monitor,
and videophone are other technology-intensive inventions we rolled out in 1999.
_Our financial presence became much healthier. We concentrated on our choicest assets, disposing of our unprofitable assets and
sluggish stocks and winding up non-performing and insolvent businesses. Thus we lowered our debt-to-equity ratio to 185%.
Meanwhile we normalized the operation of our poorly performing U.S. subsidiary Zenith. Intensive competition-driven
management of our other overseas subsidiaries gave them sounder managerial and financial structures. Our global strategy hit
the bull's-eye in the emerging East Asian markets, including China, India, and Indonesia.
_Such efforts backed by our goodwill spirit of emulation brought us stronger competences on the whole, as was particularly
conspicuous in our profits in fiscal 1999. The Digital LG vision seems gradually to be turning into reality.
_Digital LG aims at making our customers' lives more exciting and affluent and at putting us on the global forefront as a
digital leader through proactive digital management. To achieve this aim, we are merging resources now into four core fields:
Marketing, Technology, Design, and Networking. To strengthen our competences in these, we are infusing our minds with the
three core values of Innovation, Openness, and Partnership. These four core competences and three core values represent a
manifesto of non-stop transformation, of building more solid B2B, B2C, and employer-employee partnerships, and sharing more
value with all on the basis of win-win reciprocity. They will be a powerful engine speeding us to our destination of being the
digital leader in the world in the near future. With an ample reservoir of core competences and core values, our odyssey
toward the new digital continent in the new millennium will continue, powered by the following three fundamental strategies.