LG Household & Health Care Results for 2Q 20 LG HOUSEHOLD & HEALTH CARE HEALTHY BEAUTIFUL REFRESHING July 25, 20
CONTENTS 2Q 20 and 1H 20 and 2Q 20 and by Business 2Q 20 Results by Business - Healthy - Beautiful - Refreshing Summary Financial Statements Audit of these results is still in progress. Figures in this disclosure are subject to change during the auditing process.
2Q 20 and Total company in 2Q 20 delivered 979.2 bn won in sales (13.1% growth yoy), and 4.5 bn won in operating profit (13.9% growth yoy). Both sales and operating profit reached all-time high second quarter results. has increased for twenty-eight consecutive quarters since 3Q 2005, and operating profit has increased for thirty consecutive quarters since 1Q 2005. 2Q 20 Results (K-IFRS) 7-Year Trend 2Q 20 2Q 20 Increase 866.0 979.2 13.1% 979.2 4.5 0.5 4.5 13.9% 866.0 705.8 548.9 483.6 13.1% 0.5 85.5 58.0 13.9% Recurring Profit 92.9 3.9.9% 244.6 272.4 18.9 26.0 41.3 Net Profit 68.4 76.3.6% 06 06 2006-20: K-GAAP Non-Consolidated, 20: K-GAAP Consolidated, 20~20: K-IFRS 1/7
1H 20 and Total company in 1H 20 delivered 1.95 trillion won in sales (15.0% growth yoy), and 245.0 bn won in operating profit (16.1% growth yoy). Both sales and operating profit reached all-time high first-half results. 1H 20 Results (K-IFRS) 7-Year Trend 1H 20 1H 20 Increase 1,695.5 1,949.4 15.0% 1,695.5 1,949.4 2.1 245.0 2.1 245.0 16.1% 1,376.7 1,1.1 965.9 15.0% 98.6 4.6 178.5 16.1% Recurring Profit 196.9 230.3 16.9% 514.5 575.3 50.0 66.5 Net Profit 146.6 167.9 14.5% 06 06 2006-20: K-GAAP Non-Consolidated, 20: K-GAAP Consolidated, 20~20: K-IFRS 2/7
2Q 20 and by Business Both sales and operating profit for all business units Healthy, Beautiful, and Refreshing have maintained their upward trend in 2Q 20. In particular, as domestic and international cosmetics business continuously delivered high growth from first quarter, cosmetics business sales and operating profit contribution increased, and led total company s operating profit margin expansion. On a yoy basis, sales increased 7.0% in Healthy, 20.8% in Beautiful, and.3% in Refreshing. Operating profit increased 13.4% in Healthy, 16.8% in Beautiful, and.0% in Refreshing. % of & Growth by Business Units % of & Growth by Business Units 13.1% 979.2 13.9% 4.5 866.0 32% +.3% 0.5 30% +.0% Refreshing (Beverage) 33% Refreshing (Beverage) 31% Beautiful (Cosmetics) 36% 39% +20.8% Beautiful (Cosmetics) 47% 48% +16.8% Healthy (Household Goods) 31% 29% +7.0% Healthy (Household Goods) 22% 22% +13.4% 2Q 20 2Q 20 2Q 20 2Q 20 3/7
2Q 20 Results by Business - Healthy HEALTHY 25.3 increased 7.0% yoy to 285.1 bn won, and 8.1% yoy growth excluding raw materials business. Operating profit increased 13.4% yoy to 25.3 bn won..5 13.4 16.9 18.8 22.3 13.4% Main categories, including hair care, oral care, skin care, and fabric care, all showed continued strong sales growth. In particular, dishwashing liquid sales grew 15% yoy as Natural Pong delivered strong growth. Unicharm paper sales, including sanitary napkins and diapers, grew 19% yoy due to successful product diversification and continuous channel expansion. 285.1 Joint venture with No.1 US green household brand, Method, was established in June 20. Method s products introduced in Korea consist: laundry detergent, dishwashing liquid, house cleaning, and hand wash. This move enables LG H&H to lead the green trend in Korean household goods market and bring differentiated products with enhanced emotional benefit. 266.5 171.6 194.5 2.1 227.9 7.0% 20~20: K-GAAP Non-Consolidated, 20~20: K-IFRS 4/7
2Q 20 Results by Business - Beautiful BEAUTIFUL 21.4 18.3 13.5 43.6 47.1 55.0 16.8% increased 20.8% yoy to 377.5 bn won. Operating profit increased 16.8% yoy to 55.0 bn won. Prestige segment sales increased 22% yoy due to: (1) strong growth of main focused brands, Whoo and Su:m, each delivering % and 32% yoy growth, (2) rapid growth of Belif (2Q sales reached 5.8 bn won and counters reached 31 in total with 4 new ones due to positive consumer response), and (3) addition of Ginza Stefany. World s first refrigerated cosmetics brand, Frostine s, was launched this May - leading recent eco-friendly trend. All processes, including manufacturing, delivering, and sales, are controlled under cold-chain system. This innovative brand does not contain any harmful chemicals for skin, and uses natural antioxidant ingredient that is stable only at low temperature. 281.4 3.6 377.5 20.8% In the masstige segment, growth in major brands, such as Beyond, Sooryehan, and LacVert, and strengthening in color cosmetics delivered % yoy growth. In the mass segment, TheFaceShop(TFS) domestic sales increased 13% yoy, and overseas sales increased 58% yoy due to appropriate response to recent fast-changing consumption patterns. Overall TFS delivered 19% yoy sales growth and 28% yoy operating profit growth. 4.6 132.8 170.8 Overseas business, on top of strong growth of Ginza Stefany and TFS, is continuously increasing its sales portion from 8.8%(2Q ) to 14.8%(2Q ). Prestige OHUI, Whoo, SU:M, Belif, Chungyunjin, GSI 1.9 136.9 Masstige IsaKnox, LacVert, Sooryehan, Vonin, Beyond 7.7 9.5 Mass THEFACESHOP, VDI 82.9 1.2 22% % 34% 20~20: K-GAAP Non-Consolidated, 20~20: K-IFRS 5/7 2Q 2Q 2Q 2Q 2Q 2Q
2Q 20 Results by Business - Refreshing REFRESHING 13.2 Coca-Cola Bev. and others.6 19.7 23.1 27.2 31.3 249.3 15.0% -0.8* 3.0 Turned Profitable * Excluded one off gains (4.8 bn won) for fair comparison Coca-Cola Bev. and others Haitai Bev. Haitai Bev. increased to 316.6 bn won with continuous growth of both Coca-Cola Beverage and Haitai Beverage. Operating profit increased to 31.3 bn won for Coca-Cola Beverage, and 3.0 bn won for Haitai Beverage with a turn-around. Coca-Cola Beverage sales increased.2% yoy to 249.3 bn won, and operating profit increased 15.0% yoy to 31.3 bn won Cola-Cola brand sales grew % with differentiated packaging introductions, including London Olympics special package. Lemon lime soda category grew % yoy. Non-carbonated beverage sales grew 17% yoy as: (1) Georgia coffee grew 41% yoy with new pouch package launch, (2) Glaceau Vitamin Water grew 16% yoy with new flavor launch, and (3) new products, including fusion ice tea Fuze was launched. Haitai Beverage sales increased.8% yoy to 67.3 bn won from successful main brand renewals and various tea product introductions. Operating profit turned profitable to 3.0 bn won. Synergies in improving manufacturing efficiencies and expansion of sales coverage still continues from first quarter. 140.1 140.4 166.0 196.4 226.2.2% 67.3 60.7.8% 20~20: K-GAAP Non-Consolidated, 20~20: K-IFRS 6/7
Summary Financial Statements (K-IFRS) Income Statement 2Q 20 2Q 20 1H 20 1H 20 866 979 1,696 1,949 COGS 443 482 846 945 Gross Profit 423 497 849 1,004 SG&A and Others 322 383 638 759 1 5 2 245 Non-Operating Loss 8 14 15 Recurring Profit 93 4 197 230 Income Tax 24 28 50 63 Net Profit 68 76 147 168 Balance Sheets 20 Year-end Assets 2,369 2,772 Cash & Cash Equivalent 92 7 Accounts Receivable 327 427 Inventories 306 333 PPE 1,602 1,855 Tangible Asset 855 945 Intangible Asset 664 817 Liabilities 1,3 1,6 Accounts Payable 231 236 Other Payables 151 218 Borrowings 565 725 Short Term Borrowings 183 492 Long Term Borrowings 382 232 Total Shareholders' Equity 1,061 1,165 Shareholders' Equity 89 89 Capital Surplus 97 97 Accumulated Other Comprehensive Income June 20 0-4 Retained Earnings 884 989 Other Capital -72-73 Minority Interest 63 67 7/7