LG Electronics Business Plan for 2007
Seoul, Korea, January 9, 2007 – LG Electronics (LG), a leader in consumer electronics and mobile communications, today announced its key goals for 2007 as well as its management and investment plan.
The company plans to increase its competitiveness through increasing the profitability of the mobile handset business and the market share for its LCD TVs. The company will ship 78 million units of mobile handsets this year, an increase of 20 percent compared to last year. As for flat-panel TVs, LG aims to sell a total of 10.5 million units, including 2.5 million Plasma TVs and 8 million LCD TVs.
“LG will expand its global reach in all business areas, increasing our revenue, market share, profits, growth rate and shareholder returns,” said Yong Nam, Vice Chairman and CEO of LG Electronics at the 2007 International CES¿ in Las Vegas. “We will accomplish this by creating value for shareholders, customers and employees.”
LG’s sales goal is USD 44.5 billion (KRW 40 trillion) this year, which would represent a 15.3 percent increase over last year’s impressive USD 38.6 billion (KRW 37 trillion) performance. The company plans to invest a total of KRW 3.1 trillion this year: KRW 1.4 trillion in capital expenditures and KRW 1.7 trillion in R&D. The investment in 2006 was KRW 2.9 trillion in total: KRW 1.4 trillion in capital expenditures and KRW 1.5 trillion in R&D.
LG’s R&D investment will also include new business categories such as home networking, Car Infotainment and system air conditioners as well as flagship product categories such as mobile handsets and digital displays. Capital expenditures include digital TV production lines and R&D institutes. The company is also creating several research parks, including the Seocho R&D Campus and the Gasan Research Complex. LG believes this will help secure its future business by developing a long-term driving force for growth.
Key Business Strategies and Plans for 2007
To achieve the maximum profitability and global market leadership, LG will sharpen its competitive edge in developing industry-leading technologies including next generation mobile communications and IPTV while actively pursuing standardization of those essential technologies. The recent technological breakthrough the company has developed is Super Multi Blue Player, capable of playing both Blu-ray Disc and HD DVD content, which will be released in the United States in the first quarter of 2007 and in Europe in the second quarter of 2007.
LG’s sales goal for North America in 2007 is to achieve over USD 10 billion, which is an increase of 10 percent compared to last year. For its Business in North America, LG will enhance its market leadership in Flat panel LCD/Plasma TVs targeting at least 10% market share, doubling sales volume from 2006 despite continued decline in selling prices. LG will also focus on 3G handset devices, front load laundry and French door refrigerators. And the company will expand its business with Sears with the innovative product lineup. LG looks to build on the success of its Chocolate Phone with its new Shine phone, and build a foundation for future growth through its WCDMA and HSDPA expertise.