Best business results in 2004 In 2004, due to a remarkable growth in exports, LG Electronics recorded the highest gross sales figure ever. This represented a 22% increase to KRW 24.7 trillion, and demonstrated our increasing global reach. Both operating and ordinary income stood at KRW 1.3 trillion and KRW 1.9 trillion respectively. In addition, net income came to KRW 1.6 trillion. These figures represent the best business performance in our history, and reflect growth in multiple divisions. Sales from the Mobile Communications Division were up 55% from last year, reaching a total of KRW 9.5 trillion. Handset sales increased greatly in Europe and North America, with sales revenues of KRW 8.4 trillion. This was a remarkable 61% increase over the previous year. Our handset business has achieved a growth rate of more than 45% for five years in a row. This is the highest growth rate realized by any of the world's leading handset manufacturers. Sales revenue from the Digital Display Division grew 19% to a record KRW 5 trillion. The growth was driven mainly by strong sales in both digital TV and PDP. The Digital Media Division saw sales revenue of KRW 3.8 trillion. This was a 7% decrease from last year, largely due to the removal of the PC OEM business. If PC sales are excluded, the sales revenue in the Digital Media Division would instead show a growth of 17%. Digital Appliance Division sales increased 10% to KRW 6.2 trillion. A surge in premium products such as air-conditioners and drum washing machines fueled the overall growth. For five consecutive years, LG Electronics' air-conditioners have been the number one sellers in the world's appliance market.

VISION

GLOBAL TOP 3 BY 2010
To this end, we continue to enhance our employees' core competencies in order to establish a solid foundation for future growth.
Strengthening our core competence as a global company in 2004 LG Electronics emphasizes quantitative growth, but the pursuit of qualitative growth is also important for maintaining our competitiveness both at home and abroad. To this end, we continue to enhance our employees' core competencies in order to establish a solid foundation for future growth. We introduced an innovative activities called "Tear Down & Redesign (TDR)" which is based on Six Sigma. Using this framework, our efforts towards change focused on all applicable management areas whether R&D or marketing, production or design. These innovative parameters were also applied to all management support sections on short and mid-term bases. With these efforts, a new corporate culture has been established. As this corporate culture has sunk its roots into the Company's overall organization, tangible results have already emerged. The employee self-confidence has greatly increased, furnishing the energy necessary in overcoming intensified market place competition. This brings us closer to our goal becoming one of the "Global Top 3".

Wireless LCD TV (15LW1RV) Wireless 15-inch LCD TV with sophisticated design / Allows consumers to move the display around the house anywhere up to 35m from the transmitter box / Lets consumers watch for two hours without additional charging of the built-in battery

B.B. Hwang

Digital Media Division
Despite the unfavorable business environment in 2004, we experienced outstanding growth in the area of digital media. This was possible because of our ceaseless product development, enhanced price competitiveness, and managerial efficiency. Our optical storage sales have ranked at the top of the global market for seven consecutive years, and our home theater sales in the digital AV business are now number one as well. The structure of our PC business was improved greatly by phasing out the original equipment manufacturer (OEM) business, and launching our own brand into the market. Our Digital Media Division is making concerted effort to gain a lead in the convergence product amid growing and rapid challenges of convergence in the market. These efforts demonstrate our commitment to becoming a 'Global Top 3' company by 2007.
Recorder Combi Home Theater LH-RC9500TA The world's first R/RW multi DVD recorder and 6HD HiFi VCR combi home theater / 1200W high capacity, installed sound improvement technology called XTS pro / Recording DVD up to six hours with 4.7GB disc / Adopting IEEE 1394 DV input, 7 in 2 multi memory slot

030 031

(in trillions of Korean won) Domestic Export 3.7
Digital Media Division sales in 2004 recorded KRW 3.8 trillion, a 7% decrease from the previous year. This is mostly due to our withdrawal from the PC OEM business. Even though our revenues went down, our operating profit
We restructured our PC business, reducing the low profitability of PC OEM business, and implementing an aggressive brand marketing program. As a result, our domestic market share in PCs increased to 14% in 2004, compared to the 3% of 2003. In addition, our mobile device business has grown remarkably driven by a close partnership with Hewlett Packard. This paves the way for our becoming a number one supplier to global mobile device markets. The economic uncertainties in Korea caused by a slow-down in domestic consumption, and an Korean won's appreciation, are expected to continue in 2005. Our Digital Media Division will keep growing based on our augmentation of aggressive marketing activities, and the launching of new products. The size of the optical storage market in 2005 is expected to be 250 million units, a 4% increase over the previous year with the DVD Writer continuously positioning as a mainstream product in this market. Sales of slim DVD Writers are expected to continue growing. Mindful of this, we will put forth our best efforts to extend our sales of these products into global markets. With speed competition being over, we believe product price will be a crucial factor for success in 2005, and so

036 037

CTO Hee-Gook Lee
Developing mobile handsets for exports to major global telecom operators - Supplying 3G WCDMA handsets to Hutchison - North America's first EVDO VOD phone - China's first World phone Developing high-end multimedia handset for the Korean market - Developing the world's first terrestrial DMB phone - Satellite DMB phone, MP3 phone, Fingerprint recognition phone Developing dual standard DVD RW drives Enhancing the in-house development of core components, and leading in the development of next generation standards Providing full line-up of DVD recorders Developing ultra slim type Super Multi Drives Extending the development of core components, and securing patents for next generation storage standards Extending line-up of new products by applying wire and wireless networking, and developing DVD convergence products with distinct functions Extending market size through the development of portable AV convergence products
Enhancing product leadership in the 3G handset business Strengthening the competitiveness of convergence handsets, and in-house development of core components Early developing advanced technologies for high-end handsets Extending the application of innovative form factors / design

Mobile Handset

Developing premium level convergence products such as HDD/VCR Early launching network-connected products Extending the line-up of automobile-related products such as Telematics terminals, Car DVD, etc.

expanding prosperously

In 2004, LG Electronics achieved our best business performance ever. There are clear reasons why LG Electronics has shown constant growth in spite of unfavorable business environments both at home and abroad. Throughout the course of our 47 year history, the employees of LG Electronics, exhibiting a spirit of creativity and persistence, have devoted themselves to constantly implementing innovations throughout the entire organization including work processes. We have pursued to implement globally oriented management, state-of-the-art technologies, and product leadership. We also boast outstanding competitiveness due to our excellent employee relations, high-quality manpower, and a value creating management style which is becoming recognized worldwide. These strengths serve as a base for LG Electronics to continue to grow and prosper for the foreseeable future. Our ceaseless growth producing efforts will continue until we become a great company, fulfilling our vision of becoming a leader in the global electronics and telecommunications market.

CFO's Message

Young-Soo Kwon
Despite an unfavorable business environment both at home and abroad, LG Electronics maintained a consistent growth in 2004. This was primarily attributable to increases in export volumes, and sales of premium products such as digital TVs, PDPs, and mobile handsets. In particular, our overall profits have improved due to increased profitability in the mobile handset business, and gains on our equity share in LG.Philips LCD. In 2005, we will continue investing in research and development to ensure our future competitiveness in developing cutting-edge technologies for the global market, as well as the continued growth of our conventional core businesses. In addition, we will increase profitability by accelerating managerial innovation throughout the Company.
The following analysis of financial information is based on non-consolidated financial statements that comply with Korean GAAP. In addition, this section contains forward-looking statements regarding the financial condition, results of operations, general business strategies, and the plans and objectives of the LG Electronics management. Such statements involve known and unknown risks, uncertainties, and other factors, which may make the future results or performance differ from the results expressed or implied therein. LG Electronics does not make any representation or warranty, expressed or implied, as to the accuracy or completeness of the information contained in this management section, and nothing contained herein is, or shall be relied upon as a promise, whether as to the past, present or future. Such forward-looking statements were made based on current plans, estimates, and projections of the Company and the political and economic environment in which LG Electronics will foreseeably operate in the future, and therefore you should not place undue reliance on them. The figures of 2003 and 2004 reflect the organizational changes in 2005, and were readjusted to conform with the following four divisions: Mobile Communications Division, Digital Appliance Division, Digital Display Division, and Digital Media Division.
ANNUAL REPORT 2004 LG ELECTRONICS

040 041

BUSINESS RESULTS IN was a challenging year for us,
MOBILE COMMUNICATIONS Sales in the Mobile Communications
both domestically and internationally. The unfavorable business environment caused by lackluster domestic consumption, higher oil and raw material prices, and a stronger Korean currency, directly affected our overall management activities. In spite of this negative environment we achieved continued growth as sales of premium products and overall exports increased. Sales in our mobile handset business were 60% greater than last year. This was largely due to the successful implementation of GSM and WCDMA handsets. Digital Display sales, which

Social Contributions

We at LG Electronics will continue to strive to make the world happier and warmer through a variety of social contribution activities that are based on a sense of mission and responsibility.
Social Contribution History in 2004 May. 2004 Carried out "Beautiful Sunday with LG Electronics" charity fair. Jun. 2004 Conducted "LG Electronics' Blood Donation Campaign of Love" Jul. 2004 Supporting the free surgery for Vietnamese visually handicapped people offered by LGEMH Aug. 2004 Sponsored the visits of students from "The Korean Boystown" to the Mexican Presidential House Aug. 2004 Carried out a summer camp for orphaned teenagers who are responsible for taking care of their siblings Oct. 2004 Launched "LG Information Narae" for educating physically challenged people about information technologies. Nov. 2004 Conducted "LG Pickle Jar Filled with Love" program for needy neighbors Dec. 2004 Hosted musical concert to raise funds for needy Czech Republic teenagers
Fund Raising LG Electronics, acting as a faithful
our less fortunate neighbors. The "LG Electronics Social Service Group" conducts relief work to help the recovery of disaster-stricken areas, and it also offers free repair services for electronic appliances every year. Furthermore, since 2003 the group has sponsored about 500 orphaned teenagers who bear the responsibility of caring for younger siblings, and conducted blood donation campaigns and food donations, for homeless people. LG Electronics also offers information technology training programs called "LG Information Narae" for physically challenged people who have to stay at home due to their disabilities. We have an education program named "LG Study Keeper" for children from low-
corporate citizen, has been raising social contribution funds in order to give a helping hand to needy neighbors. All directors, including our CEO, voluntarily put aside 1% of their monthly salary and donate it to these causes. In 2004, the Company's regular employees donated a certain amount of their bonus, and the Company contributed funds matching the amount donated by the employees to form the social contribution fund. This fund raising activity of the employees together with management, demonstrates the charitable spirit behind LG Electronics' social contributions.

shares the spirit of ethical management, and the strong will to practice it with all employees by stating, "The Company will strictly impose a penalty upon any action that violates the spirit of ethical management", and "The Company

Corporate Governance

After the launching of the holding company, LG Electronics is equipped with an advanced corporate governance structure that is focused on a Board of Directors and a professional administrator.

052 053

This helps us deploy more transparent and value creation management activities that increase Company value, as well as shareholder value.
Domestic Individual & Institutional Investors
LG.Philips LCD. LG Micron

24% 36%

Shareholding LG Corp.

LG Corp.

LG Electronics

LG Innotech HI Plaza

Foreign Investors
The Professional Administrator's Responsible Management System, and the Board of Directors-focused Independent Management System When LG Electronics removed the
major shareholders. Currently the Board has a total of seven directors, four of whom are outside directors. To secure fairness and independence in appointing outside directors, an Outside Director Recommendation Committee consisting of one in-house director and one outside director, nominates outside directors after strict screening of their qualification. These outside directors are then voted on at the next shareholders' meeting. The outside directors are always well qualified people with professional knowledge and experience in vital areas. Their main role is to conduct check and balance functions, as well as monitoring the Company's overall management activities. They also play a role as objective advisors to the Company. The Board meetings take place every month, and every member is required to participate in the meeting. The Board members screen the meeting agenda offered by the Company management prior to the Board meeting, and evaluates and supervises
Board members an opportunity to more actively participate in the Company's management activities by offering an 'On-TheSpot Management Program' that allows the members to directly visit Company business venues based both home and abroad. We also encourage them to participate in the outside director training programs that are hosted by the Korean Directors Association.
"Circulating Investment Structure" of its affiliated companies through the launching of a holding company system, this let the holding company take full charge of investments, and LG Electronics could place its focus on its own businesses, while increasing the overall value of the Company. This corporate governance structure has laid the groundwork for increasing managerial transparency. By introducing a responsible management system under professional administrator S.S. Kim, CEO of LG Electronics, as well as using a Board of Directors-focused management system, we are taking strides in strengthening business competitiveness both domestically and internationally. This results in maximizing Company value, as well as shareholder value.

The accompanying notes are an integral part of these non-consolidated financial statements.
209,890 646,783 1,758,233 1,118,603 9,119 993,225 19,110 1,644 200,150 2,066 4,958,823 2,593,616 286,655 233,246 145,8,218,074
390,406 989,580 1,791,833 1,100,406 48,612,456 30,974 116,489 9,860 5,090,799 2,382,431 22,758 192,739 83,7,772,824
783,961 1,907,543 2,063,631 261,032 5,016,167 13,234,241
783,961 1,891,986 766,097 62,558 3,504,602 11,277,426
LG Electronics Inc. Non-Consolidated Statements of Income
(in millions of Korean won, except per share amounts)
2004 Sales (Notes 25 and 26) Cost of sales (Note 25) Gross profit Selling and administrative expenses Operating income (Note 26) Non-operating income Gain on valuation of securities using the equity method (Note 10) Foreign exchange gains Interest income Refund of income taxes Gain on valuation of derivatives (Note 17) Gain on disposal of investment securities Gain on settlement of derivatives (Note 17) Reversal of allowance for doubtful accounts Rent income Dividend income Gain on disposal of property, plant and equipment Gain on disposal of intangible assets Gain on business transfer Others 764,917 408,093 77,140 64,475 54,716 46,955 38,367 33,860 14,059 7,645 7,587 91,813 1,609,627 24,659,317 18,735,848 5,923,469 4,673,735 1,249,734
2003 20,176,910 15,350,719 4,826,191 3,763,998 1,062,193
263,375 40,057 3,503,536 9,049 119,578 12,216 5,395 5,161,095 1,123,423

062 063

2004 Non-operating expenses Foreign exchange losses Interest expense Loss from transfer of trade accounts and notes receivable Loss from disposal of property, plant and equipment Loss from disposal of investment securities Loss on impairment of investment securities (Note 5 and 9) Loss on impairment of intangible assets (Note 13) Additional payment of income taxes Loss on settlement of derivatives (Note 17) Donations (Note 29) Loss on valuation of derivatives (Note 17) Other bad debt expense Loss on valuation of securities using the equity method (Note 10) Others Income before income taxes Income tax expense (Note 22) Net income Earnings per share and ordinary income per share (in won) (Note 23) Diluted earnings per share and diluted ordinary income per share (in won) (Note 23)
2003 284,301 198,761 120,252 113,855 72,286 62,228 38,105 20,490 12,716 10,352 3,62,142 999,235 1,860,126 314,172 1,545,954 9,890 9,517 286,625 208,600 96,871 67,097 2,616 29,6,022 8,271 9,584,571 48,624 1,348,816 836,800 173,976 662,824 4,229 4,187

US$ EUR JP Others US$ EUR JP GBP AUD Others US$ EUR Others US$ Others US$ JP Others US$ JP EUR Others US$ EUR JP AUD CAD Others US$ Others

616 15,3,64 -

125,044 9,093 5,174 5,823 145,134 367,064 25,538 8,528 1,259 403,375 5,5,785 142,142,848 1,410 2,492 737,951 172,933 16,179 1,454 928,517 196,867 65,033 41,910 12,891 5,087 3,882 325,670 76,106 4,661 80,767

8. Inventories

Inventories as of December 31, 2004 and 2003, consist of the following:
2004 Acquisition cost Merchandise Finished products Work-in-process Raw materials Parts and supplies 29,586 628,626 316,947 595,617 136,307 1,707,083 See Note 12 for inventories insured against various property risks. Inventory valuation allowance (1,373) (20,206) (3,924) (6,154) (395) (32,052) Carrying value 28,213 608,420 313,023 589,463 135,912 1,675,031
2003 Carrying value 21,268 550,286 348,850 490,126 93,634 1,504,164
9. Long-Term Investment Securities
Long-term investment securities as of December 31, 2004 and 2003, are as follows:
2004 Available-for-sale securities Held-to-maturity securities 64,65,234

2003 246,246,712

076 077
Available-for-sale securities as of December 31, 2004 and 2003, are as follows:
Percentage of ownership (%) Acquisition at December cost 31, 2004
Net asset value/ Market value Carrying value Acquisition cost
Net asset value/ Market value Carrying value
Marketable equity securities KT Corp. 3 LG Investment & Securities Co.,Ltd. 5 NARA MOLD & DIE Co., Ltd. Voiceware Co., Ltd. 7 Jindoo Network Inc. 6 Vodavi Technology Inc. Hutchison Telephone Company Limited 4 Non-marketable equity securities Domestic companies Innopla Co., Ltd. Castec Korea Co., Ltd. Msoltech
12.34 3.02 8.83 19.86 0.09

318 2,928 3,462 7,662

2,1,568 6,761 3,622 15,473
127,441 262,206 2,928 393,819
105,257 84,498 2,999 1,363 5,992 200,109
19.90 5.00 10.00 8.53 9.35 36.04 13.04 15.00 3.70
1,852 4,698 1,2,500 6,500 4,254
272 1,230 4,309 1,2,435 5,765 2,220
589 1,852 4,698 1,2,500 6,500 2,220

1,852 4,1,6,500 1,618

1,695 1,1,6,500 1,618
AL Tech Inc. Korea Information Certificate Authority Inc. Association of Electronics Environment Megaround Co., Ltd. 6 Temco, Inc. Netgenetech. Co., Ltd. Manager Society, Inc. Thermo Metrix Technology Wowlinux 7 Silicon Works LG fund for small and medium Enterprises 4 TU Media Corp. Others

12.00 50.00 4.74 -

Percentage of ownership (%) Acquisition at December cost 31,2004
Overseas companies Gemfire Corp. 7 Erlang Technology Inc. 1 Neopoint Inc. 1 E2OPEN.COM Monet Mobile Others Debt securities Bonds issued by the government Convertible bonds issued by NeoDis Co., Ltd. Commercial papers issued by LG Card Co., Ltd 8,124 40,355 98,029 19,062 21,293 62,191 19,062 21,293 64,383 3,060 443,817 3,060 227,201 3,060 246,668 2,204 2,204 2,204 2,204 2,204 2,856

7. During 2004, the Company disposed of the investments, resulting in gain on disposal of investment securities of

078 079

As of December 31, 2004 and 2003, held-to-maturity securities consist of the follows:
2004 Subordinated bonds of ABN-AMRO ABCP Other 851
The annual maturities of debt securities classified as available-for-sale securities and held-to-maturity securities as of December 31, 2004 and 2003, are as follows: 2004 Due in Less than one year and one year 1 Over one year through five years Over five years through ten years
Available-for-sale securities Held-to-maturity securities

89,501 21,293 110,794

3,060 3,060
1. These are classified as short-term investments (Note 5).
The details of changes in accumulated gains (losses) on valuation of available-for-sale securities as recorded in capital adjustments for the years ended December 31, 2004 and 2003, are as follows (Note 21):

January 1, 2004

Gain (loss)

Disposal

December 31, 2004
KT Corp. Nara Mold & Die Co., Ltd. Voiceware Co., Ltd. Jindoo Network Inc. LG Investment & Securities Co., Ltd. Vodavi Technology Inc. Hutchison Telephone Company Limited E2OPEN.COM 1 Bonds issued by the Korean Government
(22,184) 2,187 1,157 (75,994) 3,063 (241) (92,012)
(80) (473) 1,250 23,160 (15,190) 9,971
(22,184) 222 (52,460) (15,190) (241) (89,853)

2,1,250 3,7,812

January 1, 2003

December 31, 2003

Hynix Semiconductor Inc. KT Corp. LG Card Co., Ltd. Nara Mold & Die Co., Ltd Voiceware Co., Ltd. LG Investment & Securities Co., Ltd. Vodavi Technology Inc. Bonds issued by the Korean Government
(23,771) (7,788) 9,022 2,758 1,638 (1,075) (2) (19,218)
74 (14,396) (5,262) (571) (481) (75,994) 4,138 (245) (92,737)
(23,697) 3,760 (6) (19,943)

1. Loss of

15,190 million on valuation of available-for-sale securities is realized due to theimpairment loss of the securities.
Interest income from investment in securities amounts to
12,338 million for the year ended December 31, 2004.

080 081

10. Equity Method Investment Securities
Equity method investment securities as of December 31, 2004 and 2003, are as follows:

As of December 31, 2004, the respective accumulated losses of equity investees from which the application of the equity method of accounting has been suspended due to their accumulated losses are as follows:
LG Electronics Service Europe Netherlands B.V. (LGESE) LG Electronics China Co., Ltd. (LGECH) LG Infocomm U.S.A.Inc. (LGICUS), subsidiary of LG Electronics U.S.A., Inc. LG Electronics Australia PTY, Ltd. (LGEAP) LG Electronics Espana S.A. (LGEES) LG Electronics United Kingdom Ltd. (LGEUK) LG Goldstar France S.A.R.L. (LGEFS)
22,565 18,397 9,874 4,141 4,138 3,990 1,040 64,145
Equity method of accounting had been suspended until December 31, 2003, for the investments in LG Electronics United Kingdom Ltd. (LGEUK) and other subsidiaries, due to the zero book value of investments in those subsidiaries. In 2004, due to net income or issuance of new shares, the losses of those subsidiaries which had not been recognized until December 31, 2003, amounting to were deducted from retained earnings. As per the resolution of the Board of Directors dated July 2004, the Company invested 289,125 million (equivalent to US$ 250 million) 51,757 million,
in LG Electronics Wales Ltd. (LGEWA) which, in turn, invested to its subsidiary, LG.Philips Displays Holding B.V.(LPD) according to an agreement with the LPDs creditor financial institutions. The other conditions in the said agreement included the deferment of loan repayment and the reduction in the interest rate of the said loan. Further, the Company revoked previous guarantee for LPD and provided the new guarantee of 57,825 million (equivalent to US$50 million).

092 093

11. Property, Plant and Equipment
Changes in property, plant and equipment for the year ended December 31, 2004, are as follows:
Balance at January 1, 2004
Acquisitions and capital expenditure

Transfer-in (out)

Disposals

Depreciation

Balance at December 31, 2004
Accumulated depreciation at December 31, 2004
Land Buildings Structures Machinery and equipment Tools Furniture and fixtures Vehicles Construction-in-progress Machinery-in-transit Total
707,683 905,935 65,577 634,708 399,837 207,633 8,088 184,926 8,333 3,122,720

Face value 339,796 (US$287.5) 296,975 (US$250.0)
Conversion period September 12, 2003 through July 28, 2006 May 18, 2005 through May 7, 2007
Number of shares of common stock to be issued 4,920,464 shares 3,049,221 shares
Conversion price 68,900 per share 96,869 per share

24. Dividends

Details of dividends declared for the years ended December 31, 2004 and 2003, are as follows:
2004 Dividend ratio (%) Common stock Preferred stock 30% 31% Dividend amount 208,220 26,631 234,851 Dividend ratio (%) 25% 26%
2003 Dividend amount 174,264 22,336 196,600
The Companys dividend payout ratio for the years ended December 31, 2004 and 2003, is computed as follows:
(in millions of Korean won, except for ratios)
2004 Total dividends (A) Net income (B) Dividend payout ratio ((A)/(B)) 234,851 1,545,954 15.19%
2003 196,600 662,824 29.66%
The Companys dividend yield ratio for the years ended December 31, 2004 and 2003, is computed as follows:

(in Korean won)

2004 Common stock Dividend per share (A) Market price as of balance sheet date (B) Dividend yield ratio ((A)/(B)) 64,100 2.34% 36,000 4.31% 1,500 Preferred stock 1,550 Common stock
2003 Preferred stock 1,250 58,600 2.13% 1,300 25,950 5.01%
25. Transactions with Related Parties
Significant transactions entered into in the ordinary course of business with related parties for the years ended December 31, 2004 and 2003, and the related account balances outstanding as of December 31, 2004 and 2003, are summarized as follows:
Sales LG Infocomm U.S.A. Inc. (LGICUS) LG Electronics U.S.A. Inc. (LGEUS) Hitachi-LG Data Storage Inc. (HLDS) LG Electronics Service Europe Netherlands B.V. (LGESE) LG Electronics Huizhou Inc. (LGEHZ) LG Electronics Italy S.P.A. (LGEIS) LG Electronics United Kingdom Ltd.(LGEUK) LG Telecom, Ltd. LG Electronics Australia PTY, Ltd.(LGEAP) Hi Plaza Inc. LG IBM PC Co., Ltd. LG Electronics Wales Ltd. (LGEWA) PT LG Electronics Display Devices Indonesia (LGEDI) LG.Philips LCD Co., Ltd. LG.Philips Displays Holding B.V. 1 LG Chem, Ltd. Zenith Electronics Corporation (Zenith) MRO Others 2003
1. For year ended December 31, 2004, purchases of 245,895 million. 2. It includes purchase and sale of investment securities from (to) LG Corp.
Purchases 7,110 4,707 37,934 36,129 2,062 91,233 109,526 1,020 5,171 43,444 33,496 1,722 2,784 461,660 478,811 351,112,431 1,563,281 3,344,125 2,679,403
Receivables 5,719 1,107 25,120 54,435 6,413 160,077 1,407 1,119 57,12,914 29,521 7,577 2,451 7,580 259,432 632,716 584,407

LG Electronics Inc. Overseas Subsidiaries

Overseas Production

Location Americas Mexico Mexicalli Name LGEMX Type Production Production Monitor LCD TV CDMA Handset GSM Handset Mexico Reynosa Brazil Amazonia LGEAZ Production / Sales TV VCR / DVD Audio Air-Conditioner Mexico Monterrey Brazil San Paulo Europe U.K New Castle U.K Wales Poland Mlawa Middle East & Africa Egypt Ismalia LGEEG Production DY FBT Tuner TV Turkey Istanbul Asia India New Delhi / Pune LGEIL LGEAT Production / Sales Production / Sales TV Monitor Refrigerator Air-Conditioner Washing Machine Microwave Oven Compressor PC Thailand Bangkok Thailand Bangkok LGETH LGEMT Production / Sales Production / Sales Washing Machine Air-Conditioner Vacuum Cleaner Compressor 1,700 1,1,500 THB 205,000 TV 2,1,2,600 THB 507,600 LGE 87.74% INR 1,126,495 Air-Conditioner 1,600 TRL 28,800,000,000 LGE 50% EGP 14,400 LGEMA Production TV 1,400 PLZ 110,236 LGE 100% LGEWA Production Monitor 2,500 GBP 204,220 LGE 100% LGENE LGESP LGEMM Production / Sales Production / Sales Production Monitor Mobile Handset Microwave Oven 1,1,200 GBP 9,000 LGE 100% BRL 35,065 LGE 100% Refrigerator 1,800 1,200 1,000 MXP 270,951 LGE 100% BRL 74,555 LGE 100% LGERS Production TV Capacity(1000) 2,2,303 USD 39,481 LGE 100% Capital Stock (1000) USD 17,500
(As of December 31, 2004)

Invest Type LGE 100%

Established Jul 1988

Jan 2000

Aug 1995

Apr 2000

Apr 1996

Oct 1988

Sep 1996

Mar 1999

LGE 83.97% EIC & etc. 16.03%

Nov 1990

May 1999
Arcelik & etc. 50% LGE 100% Jan 1997

Sep 1988

Mitr 12.26% LGE 93.75% May 1997

114 115

Location Thailand Bangkok Vietnam Haipong LGEMH Name LGICTH Type Production / Sales Production / Sales Production Wire telephone Wireless telephone Air-Conditioner Washing Machine Refrigerator Microwave Oven Vacuum Cleaner Vietnam Hanoi LGEVN Production / Sales TV Monitor DVD Optical Storage GSM Handset Vietnam Hanoi Indonesia Jakarta LGEDI VKX Production / Sales Production Switch Board CDMA System Monitor VCR, COMBI, Home Theater, DVD Indonesia Jakarta LGEIN Production / Sales TV Refrigerator Air-Conditioner China China Taizhou China Huizhou China Nanjing China Nanjing China Qinhuangdao China Shanghai China Shenyang China Tianjin LGETA LGESY LGESH LGEQH LGEPN LGENT LGEHZ LGETR Production / Sales Production / Sales Production / Sales Production / Sales Production / Sales Production / Sales Production / Sales Production / Sales Microwave Oven Air-Conditioner Motor MGT Vacuum Cleaner Compressor 10,000 4,500 20,000 10,000 6,000 8,000 CNY 1,022,364 VCR DVD TV 177 6,594 3,800 CNY 178,512 CNY 112,638 LGE 70% S.V.A. 30% LGE 78.87% S.V.A. 21.13% LGE 80% TRIC 20% Aug 1995 Dec 1994 Aug 1995 Molding 20,000 ton CNY 54,164 Refrigerator Compressor Audio Optical Storage Monitor LCD TV Washing Machine 1,150 2,300 5,000 7,000 60,000 7,2,100 CNY 130,882 CNY 98,758 CNY 177,571 LGE 80% TCL 20% LGE 70%,Toptry 5%, Xinggang 25% LGE 70% PANDA 30% LGE 100% Dec 1995 Dec 1995 Sep 1997 Oct 1993 CNY 373,434 LGE 100% Dec 1995 IDR 80,109,000 LGE 100% Nov 1990 Capacity(1000) 2,80 Sales Sales 400 Sales 200 300,000 lines 100,000 lines 5,000 12,000 USD 41,240 VND 44,048,000 LGE 40% VNPT & etc 60% LGE 100% Mar 1995 Jun 1994 VND 44,004,331 LGE 100% Jul 1995 VND 30,616,400 Capital Stock (1000) THB 76,000

Next generation Display Device and application technology (PDP, Projection, etc.) S/W Platform, S/W Technology, and S/W Engineering Key components for home appliances and technology/products ( Compressor, Motor, etc. ) Product design and proposal for product concept through customer survey Next generation TV product (HDTV, Flat TV, etc.) Home appliances-related new function products
(Air-Conditioner, Refrigerator, Washing Machine, etc.)
Jan 1998 Dec 2004 Apr 1987 Jun 2002 Jan 1984 Jan 1984 Jul 1995 Jan 2004 May 1983
Mobile communications handset Key technology of next generation mobile communications Telecommunications system and equipment
Overseas Name of R&D Center
Triveni Digital LGEDA LGTCE LGEDM LGSI LGEDC LGETC LGEDJ LGTCM LGTCI Yantai Research Center Tianjin Research Center LGERD Zenith
New Jersey, USA New Jersey, USA Aachen, Germany Milan, Italy Bengal, India Beijing, China Tokyo, Japan Tokyo, Japan Moscow, Russia Huzilia, Israel Shantung, China Tianjin, China Beijing, China Chicago, USA Digital TV technology
Product design for sales model in the U.S. Technology planning and analysis for European regions Support for the development of design for European regions Development of software Support for the development of design for China Technology analysis and research and development on Japanese electronics firms Design research on Japanese electronics firms Technology information collection and analysis, and development of software for CIS regions Technology information collection and analysis for Israel CDMA mobile handset for the Chinese market Home appliance-related technology Mobile handset/ digital TV/ DM area's S/W technologies VSB and digital transmission-related technologies
Sep 1996 Feb 1994 Apr 1998 Jan 2002 Apr 1998 Nov 1998 Jan 1981 Dec 1993 May 1995 Jul 1999 Jan 2000 May 2000 Oct 2002 Oct 1996
LG Electronics Inc. Personnel Lineup

Personnel Lineup

Number of Employees According to Position

Director

Office Workers

20,470

Manufacturing Plant Workers

10,944

31,614
Number of Employees According to Duty Production 13,884 Board of Directors Type

Standing Non-Standing

Sales 3,764

R&D 11,139

General Support 2,827

Total 31,614

S.S. Kim Young-Soo Kwon Yu-Sig Kang Suk-Jean Kang IL-Sup Kim Nyum Jin Sung-Won Hong
Director Director Director Outside Director Outside Director Outside Director Outside Director

Current Position

Representative Director Chief Financial Officer Vice-chairman of LG Corp. Chairman of CEO Consulting Group Professor of Ewha Womens University Professor of Sogang University Chairman of G-Mobile