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LG Electronics Inc. IAnnual Report 2002 I38 39
Ma n a g e me n t ’ s Di s c u s s i o n a n d An a l y s i s
. . . A Me s s a g e f r o m CF O
Young Soo Kwon
Chief Financial Officer
In 2002, operating profit exceeded 1 trillion won for the first time, jumping 29.2% year-
on-year to 1.03 trillion won.
1. Analysis of 2002 Performance
On April 1, 2002, LG Electronics was split into LG Electronics Inc. (new LG Electronics) and LG Electronics
Investment, Ltd. (LGEI). The new LG Electronics holds the core business-related subsidiaries and runs
underlying operations, including home appliances, handsets and telecommunication equipment among
others. LGEI, as a pure holding company, is responsible for the control of stakes in several subsidiaries
including LG Telecom and Dacom. In accordance with the demerger, LG Electronics was legally established on
April 1, 2002. Thus, the official financial statements of LG Electronics for fiscal year 2002 cover nine months
from April 1 to December 31. The term “ the Company” used here without any other qualifying description
will refer to “ new LG Electronics” as a pure operating company.
In order to discuss and analyze the Company’s performance and financial status more accurately, the
following section is based on figures for the full fiscal year 2002, rather than on the official financial
statements for the nine months from April 1 to December 31 that record the Company’s performance after
“ demerger.” The spin-off of the Company’s CRT (cathode ray tubes) business in the second half of 2001 has
been taken into account by revising total sales to 15.91 trillion won from the 16.60 trillion won shown in the
official financial statements for 2001.
The following section contains forward-looking statements with respect to results of operations, the financial
conditions and plans and objectives of the management of LG Electronics. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may cause the actual results of
performance of LG Electronics to be materially different from any future results or performance expressed or
implied. LG Electronics, therefore, does not make any warranty as to the accuracy or completeness of the
statements in this section. Forward-looking statements refer only to conditions as of the date they are made,
and LG Electronics undertakes no obligation to update publicly any of them in light of new information or
future events.
Overview
In 2002, sales increased 16.9% to 18.60 trillion won despite the global economic slowdown. Surging
overseas sales played a major role in boosting total sales. By business division, the Mobile Handset Division
and the Digital Appliance Division led the growth. Mobile handset sales soared 45.9% YoY to 3.52 trillion
won. Moreover, operating profit exceeded 1 trillion won for the first time, jumping 29.2% YoY to 1.03 trillion
won. Robust profitability of the Digital Appliance Division and significant improvement in profit margin from
LG전자 - 본문 2003.4 .22 7:15 AM 페이지42