LG 2001 Annual Report Download - page 10

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The planned “demerger” is a
giant step towards becoming
even more competitive in
global markets and building
on the successes of 2001.
»10
LG Electronics Inc. The
43
rd Annual Report
did more than enough to offset our disappointment in the Asian market where we saw a
30% decrease, primarily due to the spin-off of the CRT business.
Restructuring
Competing in the 21st century requires corporate flexibility, and in 2001 LGE made
the important first steps in a positive restructuring process. We spun-off our Device
Company into the launching of a promising new joint venture LG.Philips Displays.
In the 4th quarter we went through a difficult process of downsizing slow businesses
and writing off bad assets. This is part of a new beginning for LGE, and though the process
is costly, it lowered our operating profits by 14% yoy - it is a necessary step in building a
better, more efficient and more profitable Company.
The planned “demerger” is a giant step towards becoming even more competitive in
global markets and building on the successes of 2001. After April, a newly organized LG
Electronics will be born, launching itself into the future as a pure operating company. This
corporate restructuring is imperative in minimizing the risk in the telecommunications
service sector, since the magnitude of investment in 3rd-generation technologies is yet to
be defined. The changes will enable us to concentrate our resources into our core
businesses.
Message from CEO
Sales by Sectors
Area Amount Growth Amount Growth Amount
Digital Appliance Domestic 2,210.1 24.8 1,771.2 38.7 1,276.9
Export 2,753.4 30.5 2,110.6 20.2 1,755.4
Sub-total 4,963.5 27.9 3,881.8 28.0 3,032.3
Digital Display & Media Domestic 1,474.8 0.1 1,473.5 53.2 962.1
Export 5,300.6 -8.7 5,804.0 27.0 4,570.8
Sub-total 6,775.4 -6.9 7,277.5 31.5 5,532.9
Telecommunications Domestic 2,144.3 76.9 1,212.4
Export 1,765.4 306.2 434.6
Sub-total 3,909.7 137.4 1,647.0
Device Domestic 57.7 -63.0 156.1 2.0 153.1
Export 681.9 -57.4 1,599.8 8.7 1,472.1
Sub-total 739.6 -57.9 1,755.9 8.0 1,625.2
Others Domestic 197.1 -26.5 268.0 -14.0 311.8
Export 15 .7 185.5 5.5 -87.5 43.9
Sub-total 212.8 -22.2 273.5 -23.1 355.7
Total Domestic 6,084.0 24.6 4,881.2 80.5 2,703.9
Export 10,517.0 5.7 9,954.5 26.9 7,842.2
Total 16,601.0 11.9 14,835.7 40.7 10,546.1
*
Device Company was spun-off on July
1
st,
2001
and its sales were excluded in
2
H
sales.
**
Sales of Telecommunication Sector for the
year
2000
only includes sales from
September to December
***
Sales are adjusted for
2001
reorganization
200
1
2000 1999
Unit : Billion KRW, %