LPL - Earnings call transcript Q1 2021

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Daniel Lee

Good afternoon. This is Daniel Lee, in charge of LG Display's IR. On behalf of the company, let me thank all the participants at this conference call. Today, I'm joined by the CFO, DH Suh; Heeyeon Kim, Senior Vice President of Corporate Strategy Group; Seung Min Lim, Vice President of Corporate Planning; Stephen Ko, Vice President of TV Marketing; Jae Yong Kwon, Vice President of IT, Strategy and Marketing; and Ki-Joon Jin, in charge of auto marketing. The conference call today will be conducted for 1 hour in both Korean and English, starting with the presentation on the financial results of Q1 2021 and the company's outlook for Q2, followed by Q&A. IR on in QX the the for company's XXXX. to details more financial refer presentation the document website Please results of

details For refer your the through on the screen. those on the webcast, widget joining to please

will by we that benefit to the start moment XXXX been and now results based have disclaimer. take standards said, IFRS yet today's read on that not begin consolidated presentation the an note prepared the Before With on please results. are earnings a we outside presentation, auditor. Please for with audited your QX

performance Let reporting QX. me start off with trillion. was our quarter-on-quarter, business X% in down Revenue KRWX.XXX

the for due Operating shipment. of was demand price profit KRWXXX reduced X% billion, Operating margin Solid at margin with was but on mobile KRWXXX profit large to increase XX%. back seasonality. billion. shipment Net decreased continued mobile was and EBITDA Q-o-Q products, decreasing

panels, we X.XX down was market meters is shipment panels QX and ASP. seasonality. capacity Area affecting mobile QX and medium- production despite previous The million by stayed square Q-o-Q of XX% in but shipment to ASP X.XX With large-sized strong meters, the million was of Demand for from Next square quarter. the Y-o-Y. company's area decrease $XXX marking X% in increased respond X% seasonality flexibly Q-o-Q, as a increased demand. slightly

segment. QX is by breakdown Next product revenue

panels, and revenue shipment OLED panel Mobile points for at accounted TV reduced due percentage the and the down to to IT of of breakdown, portion terms midsized accounted XX%. quarter-on-quarter for X panels. In XX% small others XX%, highest

KRWX.XXX and by of cash position KRWX.XXX and financial end The Q-o-Q trillion. shortage. equivalent was we KRWXXX as responded billion Inventory the at increasing preemptively to was the cash company's trillion, QX is company's part Next ratios.

current XXX%, trillion at billion KRWXXX was XX%, end in at As Q-o-Q. was of for QX. unchanged was coming an Q-o-Q. debt-to-equity Net by in came KRWX.XXX Borrowings posting quarter-on-quarter, liabilities-to-equity flow up ratio remaining KRWXX at Q-o-Q. ratio decreased XXX% and improvement ratios, ratio financial Cash the billion

the Suh. company's by Next CFO, is DH presentation

DH Suh

Good morning. CFO DH LG of is Suh, This Display.

I on extended on part company's Despite shareholders, Before demand more QX continued your the LCD even performances, panel TV stay-at-home to continue will strong investors trend, along uncertainties now of performance. IT supply. from for you I thank as for COVID-XX. QX unwavering with all the presenting you, products, impact sharply seasonality, the due issues than like support economy as rose would and such price our brief expected of and analysts to the

performance fell the in than KRWX.XXX financial the solid As was to by quarter. first XX% higher It trillion quarter. quarter this such, previous due Y-o-Y. Revenue in other seasonality, higher from it remained X% but Q-o-Q was years

par with achievement opportunities over agilely Despite and on season the since in semiconductors. sales margin market terms In XX% by X.X of X% last the operating even staying most company the the part at P&L, TV. of was particular, responding the profit peak it EBITDA in of OLED such was as million quarter. shipment, industry, which QX. units to recorded in meaningful concerns supply grow the level margin QX seasonality, In is achieved level as glass XX%,

seeing has COVID-related the IT business, in customers been company's with end The by responding values to lifestyle flexibly and demand consumers and competitiveness growth. by clearly changes the performance triggered maintaining With distinct OLED. stable COVID-XX, are fundamental of equipped the unique

as of there some we mobile volatility quality, were As seasonal stability, impact improving by was although quarter. such and reduce yield in the operational for considerably to business, able first elements

market mid- TV, given subject of is is view for performance by it monitors structural supply as QX, will situation to a circumstances, increase and PCs. uncertainty, shipment to on panels cost the high ASP impact especially our such mid- are fall Q-o-Q, short-term digit, mobile to demand The from like our solid the high the is for is thus, part reduced large responses expected due Next single coming the single-digit grow to seasonality. by But Area guidance of while is risk a part semiconductors. that company's actual In on notebook QX and we preemptively perspective. supply issue feeling XXXX. is carefully is expected reviewing shipment to from issue that and the longer-term

our minimize the keeping while to close strengthening try impact We a market. eye will readiness on the by

strategic improving of segment outlook update improving the important of Internally, trying business and and is we in further X market, we with the while is key tasks. are sales profitability. premium most in are productivity, the to our yield Next for the goal each OLED drive segment. Mainstreaming out

For back opportunity IT, in for product we a the based mobile are strengthening the improved In sales business, on with volume half. competitiveness. the production stability, thoroughly Y-o-Y is growth models we second for our preparing strategic of of expected production customers new in mass partnership operational on and productivity will solidify and the by turnaround

and to our our operations response to in sustain LCD flexible And TV the changing remain keep in landscape. our business, and in market leadership profitability. will demand We bolstering competitive we plan

second we the following closely consumption Notably, to changes the anticipate as in We customers. to this our will the trends the will and in patterns we maximize changes situation. product demand. in such outdoor as and together available company opportunities monitor our In lead could subsequent The within campaigns strengthen try half growing year, particular, changes readiness. in market people's work closely vaccination in resources improvement changes lifestyle activities, in COVID people's with

presentation normal healthy QX attention. investors do earnings shareholders, ensure you improving stay safe. COVID-XX. for ease will, on of the designed vaccines of to same activities stability. hope rollout position through for analysts financial speedy us financial the It will is keep the the end and to inconvenience and gradually wish That Thank time, that all for to that return and I brought hoped our We a and anxiety at XXXX. by our your brings

Operator, take We now the Q&A will session. commence with questions. please

Operator

[Operator Instructions].

The be provided Suk will from Securities. question & HI Chung first Won by Investment

Chung Won Suk

I have questions. two

the that increased see panel price bodes LCD well we for really now recently, has that OLED demand the is also which First for panels. sharply

Now for has company's to there line, up the OLED I recent we completed is what little up capacity increase? also mid- developments? in quite the the are changes And been for to plan increase in a a for OLED recently, which has the capacity then what longer-term Or the sales have this, the to to we the medium- the plan recently. - about the the sales but any for turnaround company's set wonder TV, the mentioned plan timing then Guangzhou in small-sized panels? relation that also, regarding And also TV gone see Then saw the lot. of relation is

about So the expect earnings? you is second yearly question to And the auto when the occur turnaround perhaps do for then the display. or for earnings the quarterly

portion and believe what of sales is able up so And the pull increasing of for forth? now? So that do company by in then it example, out much of will sales, sales the the be the out OLED the you of auto how of as display portion stands to terms this

Unidentified Company Representative

questions. three Thank you I detect the questions. for

first, panel the I recently. sharp increase believe, LCD there price been in Now has was a that

OLED the medium-sized the well panels? small- increase situation, company's TV changes as as in to the given what the is plan So for for for capacity

Daniel Lee

the Now that discovering since are market year, story of consumers have good tells that home, for the true the TV, of TV. staying at longer half would the as now say second also I OLED data the last the OLED people believe time because we value

the year has there this So the market, also data. this look the market, And this and trend that growth overall TV you the market. growth the when at quarter TV market we then first see also the been continuing of see outpacing been set growth we OLED has the in TV amidst growth, same from in in

have on subject also regarding pandemic with a market the of OLED change is also of view and easing, to always signs So changes that, then have said currently, we the But demand. and the TVs positive could the it competitiveness. market having on course, especially also the

So whether be the would a eye on or whether capacity keep into then, question once the regarding the market of have of will for any there we the plastic decision, course, third such And would second market. expansion quarter on on have having the would And on we our small- mid-sized our been a further OLED. we make not. situation changes this the and communicate then and the of a capacity with decision to we close the year for plan

capacity in and know, Paju as in have Now you Kumi. we XX,XXX XX,XXX

is the plan our Our to capacity. now from productivity existing maximize

the that OLED. small means this regarding no made to midsized capacity at this in been decision the plastic So has increase of point,

about the question TV. second for Moving turnaround on your OLED to expected time

quarter business Now will when that question this turn to was the perhaps on TV be to able as which year. within around understand I OLED profit

difficult Now TV, good those the market for our out strengthening to and are and see trying yield also, as improve the we OLED the to signals the keep doing are well OLED as both are business, to is to can in you but timing, for able we it moving turn me pinpoint around fronts. right profit in to the I to And exact we is in well. as competitiveness, that we the order tell quality direction. we getting And TV the when will that be of

the auto display. your to about Now on third question

plastic business. from of last billion one today then at also hardest OLED, actually say supply. the business Now from the with year. the as we the in down the and to for the future semiconductor pandemic of the end market road, now the inclusive market our despite - increase is which to the probably issues hit further billion recently - on was focusing the this was difficulties, of the company so auto we $X.X I the where And that of key able suffered for the of the be one orders COVID-XX because of as would auto But the will $X.X

is So or how to future. best this that that how the to we much orders But the display of point is If up what the stands a for sales to it are grow will company. to is and pace the believe - that currently display continue expectation can sales is we that auto EV EVs case, revenue assumption the pick watching plastic bring which and further as grow business clear think bigger suited about the it OLED, the in be bring we can stands source at is EV further significant much to is the further company. then the the

this automotive believe display be will business. a opportunity very we good that for So our

longer is but how now, for contribute can term going this So so this not question for a and to key how much the is can the the business it much company. for future the grow business question become that automotive - in it the we for is display grow

Operator

will The Financial following from question be Kim Investment. Hyun-soo provided Hana by

Kim Hyun-soo

I on have questions two topics.

I the of company of in business with other believe also the to for Now the that part to has source of focus on and production, OLED believe - also developments, more then LCD the I consideration shutdown white of also revenue.

schedule was wondering I ramp-up. So the of your production about

recognizing But to was you XX,XXX to third with is course, of schedule question is related the regarding is electronics also like orders share previous earlier, could So that, the go the this was then that have then production the company's - million automotive. electronification goal, likely the about specific in mentioned profitability period increase outstanding question it the quarter. which you as the if automotive it more the of capacity, which And of the to capacity? shared mentioned what was, that XXXX, of after the be the that XX about is by the explained what earlier. revenue? to to believe to order as And orders? over us a second the the was And regarding the decision would do production earlier or also is I the And electronics then

Daniel Lee

increase the Now regarding about capacity timing of white the OLED. for question first your

explained topic. have to do we this earlier, further was regarding as Now some would studies

as regarding throughout the will comes, then timing quarter. situation this and we So the electronics, and right the And be recognized decision the the the third reviewing way would And that when believe make be and communicate orders the automotive we either question second would market. market we the was revenue. with when the

X.X receive automotive to first the process then takes that then the into when electronics, that going for to Now is delivery and go and X would orders the development, we And is about years. the that going but X to years. between be then then the how long And could also delivery the customers, made. depends that also product the and to somewhere is be X on last,

to overall, can currency is a is able at recognition period going is long-term you what to then what into I changes be level that cost. revenue the risks. regarding that the us I it be. impact this could business, well then for or account cost as given and also the the it could quite have profitability, it the tell But would on is also - the you for So And exchange the is of we absorb what explained. target could just also the then profitability, you be in that what rate you, to has to as the take difficult But tell that also the average, have

Operator

following [indiscernible]. The question by be will provided

Unidentified Analyst

secondly, capacity you And running we for LCD capacity automotive were already Gen production to use could indicated earlier flexible X Then you is Should Or actually into are the of you to extending of the speaking, XXXX? business, panels. that understand continue you of OLED? LCD supposed display you earlier panels. thinking you'll will throughout year? in continue terms this - to We TV currently? the Going is you split broadly the that provide, moving close already back a what between what remain to

Daniel Lee

LCD first, large But ultra this, shut PX, Now on the this. production it Korea, large panels, yes, ultra down. are regarding then of - for the capacity the production for question in we for the already has for TV been maintaining and production your capacity,

to fab, maximize that opportunities available its and LCD presented we us are to the in within So operation the to for try flexible remain the resources. intend

flexible question, And OLED about outstanding back the also perhaps depending going the - PX The to not plastic bit share future, we add throughout and question remain the into out to automotive then the possibly to orders share market regarding POLED first the only year, So of And intend this the but is display. the more of about to on capacity. the of then your was XX%. question response a the about the circumstances.

converted IT currently of this And from For the that was maintaining then are as explained this coming TV. the with than as to well completely certain shut But actually we the PX down capacity, deal customers. we capacity yes, rather have then earlier the needs production down, have LCD commercial it production. shutting the request for domestic we

Operator

Kyu will by The last Daiwa presented from question be Sung Kim Securities.

Kim Sung Kyu

strategic the panel IT the is that We I IT the see recently, as high peers are of And this have means quite strong. well. signs company one for for also from see additionally some of questions showing products. that regarding even the to side LCD company's OLED IT more we becoming also their business. the for now and the domestic moving demand in also - signs And that IT panel profitability are customers showing is additionally of OLED tablet using also the

And given such strategy focused believe the changes had affecting company change is to for how these So company's market? company? IT Especially company's I the that you in outlook this LCD the do the strategy? you is wonder the for strategy, going do what regarding the the take that changes the foresee

Daniel Lee

TV say also really smartphones. mobile the products the in this with first then also of about in OLED the that Now because the OLED first all, adoption is And would plastic being as increasing I of to adoption of increasing ago, preparation OLED know, represents like is last seeing I not especially starting now that it years time you that adopted would are we and realm. emphasize now XX in the IT would is then the products,

smaller and So between the the smartphones. products then large

which Now midsized segment, IT products. is the the

will last, frontier large size the IT the then small also OLED segment. is say, of let's matter And they or given this unique this the OLED. share only whether the among where for it grow that are Now time adopted is of in be IT that will advantages believe size, products the that to I - a is OLED, and

of this been preparation small to either explained size or we intermediate OLED, past, from all technological context, size the as or we had for IT in making always strategy, large several now the the the times for products. the company's for sizes midsize So have as

IT of products share the also we the have we and advantages that that launched adopted possibilities for products, that we seen once to believe to for of So the is differentiated grow, OLED always And last had OLED the IT then we once year. need LCD. foldable begins were the kind have also from have the the

of that also and terms technological advantages, trying advantages to such in the we have. strengthening So keep production we the are

advantage continuing from of also what for for that what will I well. leverage kind message as technological equip so believe IT takes once that our And us OLED doing are that off sum, products, it be in well. the - - we the to with and we as to segment ready I enjoyed we the that in we is the of market important for that is ourselves LCD the OLED advantages get are have is that technological competitiveness the So to able

Daniel Lee

We Thank the again earnings Please XXXX questions. you once Thank at joining conference us IR for QX close do additional call. will contact us any now team you. for today.

LG Display (LPL) 28 Apr 212021 Q1 Earnings call transcript