2003 1Q RESULTS

1
2003 1Q RESULTS
2
Contents

• Business Results 12
• Household Products 34
• Cosmetics 56
• Key Financials 7

This presentation contains forward
looking statements which are based on
managements assumptions and estimates. The
forward looking statements involve certain risks
and uncertainties that could cause actual results
to differ materially from those contained in this
presentation. In addition, an independent
auditing is not required for quarterly financial
statements.
3
Business Results quarterly trend
While displaying the seasonal trend in general,
LG HHs operation was affected by the overall
economic slowdown in 4Q, 2002. However, business
results were improved in 1Q, 2003.
37.4 (12.7)
36.1 (12.9)
33.2 (11.7)
29.2 (11.2)
24.7 (8.6)
25.1 (9.2)
22.8 (9.4)
O.P. (Margin)
19.6 (7.9)
(KRW bn)
2.9 (1.2)
294.1
285.9
284.8
279.5
274.1
Sales
259.6
249.0
249.3
243.8
(KRW bn)
1Q
1Q
1Q
2Q
3Q
4Q
2Q
3Q
4Q
2002
2003
2001
1
4
Earning Forecast for 1Q, 2003
Sales of KRW 285.9bn and operating profit of KRW
24.7bn were recorded in 1Q, 2003. A sales
increase of 0.4 and a O.P decrease of ?25.6
y-o-y were observed. However, sales and profit
improvements remained at a satisfactory level
q-o-q.
Results Analysis
Earning Forecast
(KRW bn)
(y-o-y)

• Negative market growth from weak consumption
• - Household products 6 major category market
  ?6
• - Cosmetic market ?12
• Increased marketing cost from intense
  competition
• - Lowered selling prices for some products
• - Increased sales commissions
• New products and premium brands cultivation
• - Increase in advertising / packaging / sample
  expenses

2
5
Household Products Results-quarterly trend
The seasonality caused by the Lunar New Year
Korean Thanks Giving holidays is shown in the
Household Products results. Despite the negative
growth in the major product category markets,
sales growth remained solid in 1Q, 2003.
28.7 (14.1)
24.4 (12.6)
20.3 (10.9)
18.7 (9.7)
17.2 (10.1)
16.5 (10.2)
14.5 (8.2)
O.P. (Margin)
10.3 (6.4)
8.0 (4.8)
(KRW bn)
203.2
193.9
193.3
186.7
Sales
176.5
170.1
168.2
162.3
159.7
(KRW bn)
1Q
1Q
1Q
2Q
3Q
4Q
2Q
3Q
4Q
2003
2002
2001
3
6
Earning Forecast for 1Q, 2003
Sales of KRW 193.3bn and operating profit of KRW
18.7bn were recorded in 1Q, 2003. A sales
increase of 3.5 and a O.P decrease of ?7.9
y-o-y were observed. However, sales and profit
improvements remained at a satisfactory level
q-o-q.
Results Analysis
Earning Forecast
(KRW bn)
(y-o-y)

• Negative market growth from weak consumption
• - Personal care market ?13
• - Home care market 1
• Increased marketing cost from intense
  competition
• - Advertising promotion cost increased
• New premium brands cultivation
• - Lemoning/Claren/6 strategic brands marketing
  expenses
• increased
• Lemoning laundry bleach
• Claren dental whitening product

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7
Cosmetics Results-quarterly trend
Since 1Q, 2002, sales displayed a downward trend.
However, sales operating profit bounced back in
1Q, 2003.
13.0 (12.4)
12.1 (12.9)
11.8 (13.0)
10.7 (10.6)
9.7 (10.2)
O.P. (Margin)
????(?)
6.7 (7.1)
6.4 (7.5)
5.9 (6.3)
(KRW bn)
?3.1 (?3.7)
104.8
100.8
? ? ?
Sales
95.2
94.1
93.4
93.8
91.1
85.6
82.9
(KRW bn)
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2003
2001
2002
5
8
Earning Forecast for 1Q 2003
Sales of KRW 93.4bn and operating profit of KRW
5.9bn were recorded in 1Q, 2003, a decrease of
?10.9 ?54.6 respectively y-o-y. However,
sales and profit improvements remained at a
satisfactory level q-o-q.
Results Analysis
Earning Forecast
(KRW bn)
(y-o-y)

• Negative growth of major distribution channels
• - Specialty shops ?20
• - New type door to door ?34
• Continued channel shift by consumers
• - Causing increased promotional expenses
• New premium brands cultivation
• - Increased marketing expenses for
• The Whoo / Ohui / Isa Knox brands

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9
Key Financials
By maintaining stable cash flows and disposing
non business related assets such as stake in LG
Investment Securities, borrowing of KRW 50.1bn
was additionally reduced. At the end of 1Q, 2003,
net borrowings to equity ratio declined to 30.
Borrowings
Key Financials
(KRW bn)
(KRW bn)
2001 2002 1Q 2003
27.3 95.1 50.0 33.0 205.4
70.0 80.7 - 22.3 173.0
20.0 80.7 - 22.2 122.9
Short Term Current Maturities Bonds Long
Term Total
Borrowings
205.4
173.0
Net Borrowings
(164.7)
122.9
(144.8)
(78.0)
2001
2002
1Q, 2003
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