Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16]

Name	Symbol	Market	Type
LG Display Co Ltd	NYSE:LPL	NYSE	Depository Receipt

	Price Change	% Change	Price	High Price	Low Price	Open Price	Traded	Last Trade
	0.07	2.24%	3.20	3.215	3.14	3.16	201,993	21:00:03

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of November 2023

LG Display Co., Ltd.

(Translation of Registrant’s name into English)

LG Twin Towers, 128 Yeoui-daero, Yeongdeungpo-gu, Seoul 07336, Republic of Korea

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submission to furnish a report or other document that the registration foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ☐ No ☒

QUARTERLY REPORT

(From January 1, 2023 to September 30, 2023)

THIS IS A TRANSLATION OF THE SEMI-ANNUAL REPORT ORIGINALLY PREPARED IN KOREAN AND IS IN SUCH FORM AS REQUIRED BY THE KOREAN FINANCIAL SUPERVISORY COMMISSION.

IN THE TRANSLATION PROCESS, SOME PARTS OF THE REPORT WERE REFORMATTED, REARRANGED OR SUMMARIZED AND CERTAIN NUMBERS WERE ROUNDED FOR THE CONVENIENCE OF READERS. REFERENCES TO “Q1”, “Q2”, “Q3” AND “Q4” OF A FISCAL YEAR ARE REFERENCES TO THE THREE-MONTH PERIODS ENDED MARCH 31, JUNE 30, SEPTEMBER 30 AND DECEMBER 31, RESPECTIVELY, OF SUCH FISCAL YEAR. REFERENCES TO “Q1~Q3” OF A FISCAL YEAR ARE REFERENCES TO THE NINE-MONTH PERIOD ENDED SEPTEMBER 30 OF SUCH FISCAL YEAR. REFERENCES TO “W” ARE REFERENCES TO THE KOREAN WON.

UNLESS EXPRESSLY STATED OTHERWISE, ALL INFORMATION CONTAINED HEREIN IS PRESENTED ON A CONSOLIDATED BASIS IN ACCORDANCE WITH KOREAN INTERNATIONAL FINANCIAL REPORTING STANDARDS, OR K-IFRS, WHICH DIFFER IN CERTAIN RESPECTS FROM GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN CERTAIN OTHER COUNTRIES, INCLUDING THE UNITED STATES. K-IFRS ALSO DIFFERS IN CERTAIN RESPECTS FROM THE INTERNATIONAL FINANCIAL REPORTING STANDARDS AS ISSUED BY THE INTERNATIONAL ACCOUNTING STANDARDS BOARD. WE HAVE MADE NO ATTEMPT TO IDENTIFY OR QUANTIFY THE IMPACT OF THESE DIFFERENCES IN THIS DOCUMENT.

Contents


1.	Company		4
	A.	Name and contact information	4
	B.	Credit rating	4
	C.	Capitalization	4
	D.	Voting rights	4
	E.	Dividends	4
	F.	Matters relating to Articles of Incorporation	5

2.	Business		5
	A.	Business overview	5
	B.	Industry	6
	C.	New businesses	8
	D.	Customer-oriented marketing activities	8

3.	Major Products and Raw Materials		8
	A.	Major products	8
	B.	Average selling price trend of major products	9
	C.	Major raw materials	9

4.	Production and Equipment		10
	A.	Production capacity and output	10
	B.	Production performance and utilization ratio	11
	C.	Investment plan	11

5.	Sales		11
	A.	Sales performance	11
	B.	Sales organization and sales route	11
	C.	Sales methods and sales terms	12
	D.	Sales strategy	12
	E.	Major customers	13


6.	Purchase Orders		13

7.	Risk Management and Derivative Contracts		13
	A.	Risk management	13
	B.	Derivative contracts	13

8.	Major Contracts		15

9.	Research & Development		15
	A.	Summary of R&D-related expenditures	15
	B.	R&D achievements	15

10.	Intellectual Property		17

11.	Environmental and Safety Matters		17
	A.	Business environment management	17
	B.	Product environment management	18
	C.	Green Management	20
	D.	Status of sanctions	20

12.	Financial Information		20
	A.	Financial highlights (Based on consolidated K-IFRS)	20
	B.	Financial highlights (Based on separate K-IFRS)	21
	C.	Consolidated subsidiaries as of September 30, 2023	21
	D.	Status of equity investments as of September 30, 2023	22

13.	Audit Information		23
	A.	Audit service	23
	B.	Non-audit service	23

14.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		23

15.	Board of Directors		23

16.	Information Regarding Shares		24
	A.	Total number of shares	24
	B.	Shareholder list	24

17.	Directors and Employees		24
	A.	Directors	24
	B.	Employees	25

18.	Other Matters		25
	A.	Legal proceedings	25
	B.	Status of collateral pledged to related party	25
	C.	Material events subsequent to the reporting period	25

Attachment: 1. Financial Statements in accordance with K-IFRS

1.	Company

Name and contact information

The name of our company is “EL-GI DISPLAY CHUSIK HOESA,” which shall be “LG Display Co., Ltd.” in English.

Our principal executive office is located at LG Twin Towers, 128 Yeoui-daero, Yeongdeungpo-gu, Seoul 07336, Republic of Korea, and our telephone number is +82-2-3777-1010. Our website address is http://www.lgdisplay.com.

Credit rating

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

Capitalization

(1)

Change in capital stock (as of September 30, 2023)

There were no changes to our issued capital stock during the reporting period ended September 30, 2023.

(2)

Convertible bonds (as of September 30, 2023)

We have no outstanding convertible bonds as of September 30, 2023.

Voting rights

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

Dividends

Dividends for the three most recent fiscal years


Description (unit)		2023 Q1~Q3			2022			2021
Par value (Won)			5,000			5,000			5,000
Profit (loss) for the year (million Won)⁽¹⁾			(2,791,928	)		(3,071,565	)		1,186,182
Earnings (loss) per share (Won)⁽²⁾			(7,803	)		(8,584	)		3,315

Total cash dividend amount for the period (million Won)			—			—			232,580

Total stock dividend amount for the period (million Won)			—			—			—

Cash dividend payout ratio (%)⁽³⁾			—			—			19.61
Cash dividend yield (%)⁽⁴⁾	Common shares		—			—			2.82
	Preferred shares		—			—			—
Stock dividend yield (%)	Common shares		—			—			—
	Preferred shares		—			—			—
Cash dividend per share (Won)	Common shares		—			—			650
	Preferred shares		—			—			—
Stock dividend per share (share)	Common shares		—			—			—
	Preferred shares		—			—			—

(1)	Based on profit for the year attributable to the owners of the controlling company.

(2)	Earnings per share is based on par value of W5,000 per share and is calculated by dividing net income by weighted average number of common shares.

(3)	Cash dividend payout ratio is the percentage that is derived by dividing total cash dividend by profit for the year attributable to the owners of the controlling company.

(4)

Cash dividend yield is the percentage that is derived by dividing cash dividend by the arithmetic average of the daily closing prices of our common shares during the one-week period ending two trading days prior to the closing of the register of shareholders for the purpose of determining the shareholders entitled to receive annual dividends.

Historical dividend information


Number of consecutive years of dividends⁽¹⁾		Average Dividend Yield⁽¹⁾
Interim dividends	Annual dividends	Last 3 years	Last 5 years
—	—	0.94	0.56

(1)	The average dividend yield is calculated using the simple arithmetic average method, including the fiscal years in which no dividend was paid (dividends were paid with respect to fiscal year 2021 only based on the dividend resolution date).

Matters relating to Articles of Incorporation

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

2.	Business

Business overview

We were incorporated in February 1985 under the laws of the Republic of Korea. LG Electronics and LG Semicon transferred their respective LCD business to us in 1998, and since then, our business has been focused on the research, development, manufacture and sale of products that apply display technologies such as OLED and TFT-LCD. Sorting by major sales product category, television, IT products and mobile and other products accounted for 22%, 40% and 38% of our total sales, respectively, in the three quarters of 2023. Our customers primarily consist of global set makers, and our top ten customers comprised 86% of our total sales revenue in the three quarters of 2023. As a company focused on exports, our overseas sales accounted for approximately 97% of our total sales in the three quarters of 2023. We provide close local support through our overseas sales subsidiaries located in the United States, Germany, Japan, Taiwan, China and Singapore.

We operate key production facilities in Korea, China and Vietnam, and as of September 30, 2023, our cumulative production capacity was approximately 3.8 million glass sheets for the nine month period then ended, as converted into eighth-generation sheets (2200x2500mm). In order to expand our production capacity of differentiated and competitive products such as OLED panels, our total capital expenditures on a cash out basis was around W5.2 trillion in 2022. In 2023, we expect to reduce our capital expenditure to approximately in the W3 trillion range, as we strive to secure financial stability.

The major raw materials for display panel production include glass, semiconductors, polarizers, organic matter, backlight units (“BLU”) and printed circuit boards (“PCB”), and the prices of our raw materials may fluctuate as a result of supply and demand in the market as well as changes in our purchase quantity.

As securing production capacity through large scale investments in the display industry requires a long period of time, panel prices may fluctuate due to the imbalance between the increase in production capacity and growth in demand. The sales performance of industry players is differentiated by not only the production capacity of each company but also other competitive differences arising from factors including technology, product development capability, manufacturing efficiency, quality control and customer relationships, along with the price differentiation incorporating such factors. In addition, given the high proportion of our sales overseas, our sales of display panels are denominated mainly in U.S. dollars whereas our purchases of raw materials are denominated mainly in U.S. dollars, Japanese Yen and Chinese Yuan. Accordingly, our profit margins may be affected by changes in the exchange rates between the currencies. We strive to minimize the risk relating to foreign currency denominated assets, liabilities and operating cash flow due to exchange rate fluctuations.

Our research and development expenses represent approximately 13% of our sales, and we are continually creating customer value through systematic R&D activities for new products and technologies. Leveraging our competitive R&D activities, we are leading the display market by providing differentiated values in display panel products utilizing our OLED and TFT-LCD technologies for various uses including television, IT and mobile products, as well as automobiles and industrial uses.

Consolidated operating results highlights


	(Unit: In billions of Won)
	2023 Q1~Q3			2022			2021
Sales Revenue		13,935			26,152			29,878
Gross Profit		(519	)		1,124			5,305
Operating Profit (loss)		(2,642	)		(2,085	)		2,231
Total Assets		37,538			35,686			38,155
Total Liabilities		28,648			24,367			23,392

Industry

(1)

Industry characteristics

•

From the supply perspective, the display panel industry is technology- and capital-intensive in nature and requires mass production through achieving an economy of scale.

•

From the demand perspective, the display panel industry tends to demonstrate a high level of volatility depending on the global macroeconomic conditions, major regional sales events and/or seasonal factors.

•

Though the display panel industry is facing a short-term risk of decreased consumption of related goods and reduced confidence of investors due to continued uncertainty in the global macroeconomic environment, there are continued opportunities in the display market to meet changes in consumer lifestyle and specific consumer needs in the mid- to long-term.

•

In the market for television display panels, new opportunities from the expansion of the ultra-large TV market are expected to arise with the increase of viewable content (including over-the-top services) and more diversified uses of television (such as playing video games).

•

In the market for traditional IT products such as laptops and desktop monitors, growth opportunities for new offerings such as gaming products and portable products are expected to increase due to the continually expanding demand for digital content production and consumption that utilize IT products in light of changes in lifestyle.

•

The growth in the market for smartphone products continued to be concentrated around high value-added products using plastic OLED display panels that offer superior performance through design flexibility, low-power consumption and high resolution, in light of increased use of smartphones for mobile contents and gaming purposes with the development of 5G communication infrastructure.

(2)

Growth Potential

•

The display panel industry is expected to continue to grow, as the essential role of display products as a key device and a necessity for information and communication in daily lives of individuals as well as for industrial purposes becomes more pronounced. We are strengthening our business base with a focus on customer value and developing new markets under our strategic plan to transition our business to center around OLED, which has a strong future growth potential within the display panel industry. With respect to large-sized display panels, we are focusing on securing OLED dominance in the market through differentiated products such as “OLED.EX” and “Cinematic Sound” OLED display panels while leading the expansion into new business areas, such as transparent OLED display panels and gaming display panels. In the small-sized display panel business, we are further expanding our production capacity by securing high value-added and differentiated technology and stable operating capabilities for 6th generation plastic OLED smartphone displays while continuing to grow our small- and medium-sized OLED business in other product lines, including automotive display panels. We are also preparing to respond to new market opportunities, including automotive sound solutions, augmented reality and virtual reality. Furthermore, in the medium-sized display panel business, we are increasing the proportion of premium products such as high resolution and wide screen products based on IPS and Oxide technologies.

(3)

Cyclicality

•

The display panel business is characterized by being highly cyclical and sensitive to fluctuations in the general economy. The industry experiences recurring volatility caused by imbalances between supply and demand due to capacity expansion and changing production utilization rates within the industry.

•

Macroeconomic factors and other causes of business cycles can affect the rate of growth in demand for display panels. Accordingly, if supply exceeds demand, average selling prices of display panels may decrease. Conversely, if growth in demand outpaces growth in supply, average selling prices may increase.

(4)

Market conditions

•

Most display panel manufacturers are located in Asia as set forth below. Competition in the TFT-LCD sector is intensifying amid investments in new fabrication facilities led by Chinese panel manufacturers. In response, Korean panel manufacturers are continuing their efforts to maintain their market leadership and differentiate themselves by transitioning their business focus to OLED products and upgrading their TFT-LCD businesses.

Korea: LG Display, Samsung Display, etc.

Taiwan: AU Optronics, Innolux, CPT, HannStar, etc.

Japan: Japan Display, Sharp, etc.

China: BOE, CSOT, HKC, etc.

•

Our worldwide market share of large-sized display panels (i.e., panels that are 9 inches or larger) based on revenue is as follows:


	2023 Q1~Q3			2022			2021
Panels for Televisions⁽¹⁾⁽²⁾		11.5	%		23.6	%		21.7	%
Panels for IT Products⁽¹⁾		18.4	%		18.8	%		19.0	%

Total⁽¹⁾		13.9	%		20.2	%		19.9	%

(1)	Source: Large Area Display Market Tracker (OMDIA). Data for 2023 Q1~Q3 are based on OMDIA’s estimates, as actual results for 2023 Q3 have not yet been made available.

(2)	Includes panels for public displays.

(5)

Competitiveness and competitive advantages

•

Our ability to compete successfully depends on factors both within and outside our control, including the development of new and premium products through technological advances, timely investments based on visibility of profitability, adaptable product portfolio and flexible fabrication mix, achievement of competitive production costs through enhancing productivity and managing supply costs of components and raw materials, our relationship with customers, success in marketing to our end-brand customers, general economic and industry conditions and foreign exchange rates.

•

In order for us to compete effectively, it is critical to offer differentiated products that enable us to secure profit margins even during times of a mismatch in the market supply and demand, to be price- and cost-competitive and to maintain stable relationships with customers.

•

A substantial portion of our sales is attributable to a limited number of end-brand customers and their designated system integrators. As such, it is important to build a sustained relationship with such customers.

•

Developing new products and technologies that can be differentiated from those of our competitors is critical to the success of our business. It is important that we take active measures to protect our intellectual property internationally. It is also necessary to recruit and retain experienced key managerial personnel and skilled line operators.

•

As a leading technology innovator in the display industry, we continue to focus on delivering differentiated value to our customers by developing various technologies and products, including display panels with WOLED/POLED, IPS, Oxide, in-TOUCH and other technologies. With respect to OLED panels, following our supply of the world’s first 55-inch OLED panels for televisions in January 2013, we have shown that we are technologically a step ahead of the competition by continuing to enhance the performance of our WOLED products and to offer differentiated large-sized OLED products such as our “Transparent,” “Cinematic Sound,” “Bendable,” “Rollable” and “Gaming” large-sized OLED. Moreover, we have continually introduced differentiated plastic OLED products for smartphones, automotive products, wearable devices and foldable notebook computers, among others. With respect to TFT-LCD panels, we are leading the market with our competitive advantages in technology, including through our IPS, Oxide and LTPS technology-based ultra-large and ultra-high definition (“Ultra HD” or “UHD”) television panels, desktop and notebook monitors featuring high resolutions, differentiated designs and high frequency refresh rates, and specialized products for automotive, commercial and medical uses. Our production facilities are also equipped to produce products incorporating in-TOUCH technology.

•

Moreover, we are maintaining and strengthening close long-term relationships with major global firms to secure customers and expand partnerships for technology development.

New businesses

For our continued growth, we are actively exploring and preparing for new business opportunities in response to the changing market environment. As such, we are continually reviewing and looking at opportunities in the display and promising new industries.

Customer-oriented marketing activities

Through engaging in detailed analysis and acquiring insight on the market and industry conditions, technology, products and end-user consumers, we seek to provide differentiated values that are customer- and consumer-friendly. In addition, we engage in activities that are geared to proactively identify and offer meaningful benefits to customers and consumers. As a result, we are continually developing products that provide differentiated values using our differentiated technologies. At the same time, we strive to create new markets and mutually benefit our business and our customers by obtaining customer trust and satisfaction through our customer- and consumer-oriented marketing activities.

3.	Major Products and Raw Materials

Major products

We manufacture TFT-LCD and OLED panels, of which a significant majority is sold overseas.

(Unit: In billions of Won, except percentages)

2023 Q1~Q3

Business area

Sales type

Items (By product)

Usage

Major trademark

Sales
Revenue

Percentages
(%)

Display

Goods/Products/Services/ Other sales

Televisions

Panels for
televisions

LG
Display

3,015

21.6

IT
products

Panels for
monitors,
notebook
computers
and tablets

LG
Display

5,602

40.2

Mobile,

etc.

Panels for
smartphones,
etc.

LG
Display

5,318

38.2

Total

13,935

100.0

Average selling price trend of major products

The average selling prices of display panels are subject to change based on market conditions and demand by product category. The average selling price of display panels per square meter of net display area shipped in the third quarter of 2023 remained similar compared to the second quarter of 2023, as a continued delay in the recovery in demand in light of the uncertain macroeconomic environment and a continued trend of inventory adjustment in downstream industries impacted each of our major product groups differently. The average selling prices of display panels per square meter of net display area may continually fluctuate in the future due to changes in market conditions.

(Unit: US$ / m²)


Period		Average Selling Price⁽¹⁾⁽²⁾(in US$ / m²)
2023 Q3		804
2023 Q2		803
2023 Q1		850
2022 Q4		708
2022 Q3		675
2022 Q2		566
2022 Q1		660
2021 Q4		806
2021 Q3		750
2021 Q2		703
2021 Q1		736

(1)	Quarterly average selling price per square meter of net display area shipped.

(2)	Excludes semi-finished products in the cell process.

Major raw materials

Prices of major raw materials depend on fluctuations in supply and demand in the market as well as on changes in size and quantity of raw materials due to the increased production of large-sized panels.


				(Unit: In billions of Won, except percentages)
Business area	Purchase type		Items	Usage		Cost⁽¹⁾		Ratio (%)			Suppliers
Display		Raw materials	PCB		Display panel manufacturing		1,161		15.4	%	Youngpoong Electronics Co., Ltd., etc.
			Polarizers				1,116		14.8	%	LG Chem, etc.
			BLU				902		12.0	%	Heesung Electronics LTD., etc.
			Glass				317		4.2	%	Paju Electric Glass Co., Ltd., etc.
			Drive IC				716		9.5	%	LX Semicon, etc.
			Others				3,323		44.1	%	—

Total							7,535		100.0	%

- Period: January 1, 2023 ~ September 30, 2023.

(1)	Based on total cost for purchase of raw materials which includes manufacturing and development costs, etc.

(2)	Among our major suppliers, Paju Electric Glass Co., Ltd. is our affiliate, LG Chem is a member company of the LG Group and LX Semicon is an affiliate of LX Holdings Corp.

•

The market price of polarizers, which is a main raw material for display panels, decreased by 13% as of September 30, 2023 compared to the end of the previous year, while the market price of glass remained similar over the same period.

•

The market prices of PCB, drive IC and BLU, which are the main raw materials for display modules, decreased by 19%, 16% and 6%, respectively, as of September 30, 2023, compared to the end of the previous year.

•

The primary reason for the fluctuations in unit prices of our raw materials was the delayed recovery in demand due to a global economic slowdown. The unit prices of raw materials may continue to fluctuate in light of changes in the market conditions of such materials as well as various international economic and political factors.

4.	Production and Equipment

Production capacity and output

(1)

Production capacity

The table below sets forth the production capacity of our Gumi, Paju and Guangzhou facilities in the periods indicated.

(Unit: 1,000 glass sheets)

Business area

Items

Location of facilities

2023 Q1~Q3⁽¹⁾

2022⁽¹⁾

2021⁽¹⁾

Display

Display panel, etc.

Gumi, Paju, Guangzhou

3,821

8,794

9,230

(1)

Calculated based on the maximum monthly input capacity (based on glass input substrate size for eighth-generation glass sheets) during the year multiplied by the number of months in a given period. The production capacity for facilities with adjusted utilization rates have been calculated based on the maximum input capacity during the period.

(2)

Production output

The table below sets forth the production output of our Gumi, Paju and Guangzhou facilities in the periods indicated.

(Unit: 1,000 glass sheets)

Business area

Items

Location of facilities

2023 Q1~Q3⁽¹⁾

2022⁽¹⁾

2021⁽¹⁾

Display

Display panel, etc.

Gumi, Paju, Guangzhou

3,108

6,390

8,124

(1)	Based on the production results (input standard) of each plant converted into eighth-generation glass sheets.

Production performance and utilization ratio


		(Unit: Hours, except percentages)
Production facilities	Available working hours in 2023 Q1~Q3	Actual working hours in 2023 Q1~Q3	Average utilization ratio
Gumi	5,448⁽¹⁾(24 hours x 227 days)	5,336⁽¹⁾(24 hours x 222.33 days)		97.9	%
Paju	6,552⁽¹⁾ (24 hours x 273 days)	6,084⁽¹⁾(24 hours x 253.5 days)		92.9	%
Guangzhou	6,552⁽¹⁾ (24 hours x 273 days)	6,432⁽¹⁾(24 hours x 268 days)		98.2	%

(1)	Number of days is calculated by averaging the number of working days for each facility.

Investment plan

In 2022, our total capital expenditures on a cash out basis was around W5.2 trillion. In 2023, we expect to reduce our capital expenditures to approximately in the W3 trillion range in order to secure financial stability.

Sales

Sales performance


				(Unit: In billions of Won)
Business area	Sales types	Items (Market)		2023 Q1~Q3		2022⁽²⁾		2021
Display	Products	Display panel	Overseas⁽¹⁾		13,440		25,651		29,204
			Korea⁽¹⁾		441		668		621
			Total		13,881		26,319		29,825
	Royalty	LCD, OLED technology patent	Overseas⁽¹⁾		13		12		14
			Korea⁽¹⁾		0		0		0
			Total		13		12		14
	Others	Raw materials, components, etc.	Overseas⁽¹⁾		30		24		27
			Korea⁽¹⁾		12		10		12
			Total		42		34		39
	Total		Overseas⁽¹⁾		13,482		25,687		29,245
			Korea⁽¹⁾		453		678		633
			Total		13,935		26,365		29,878

(1)	Based on ship-to-party.

(2)	Sales excluding forward exchange hedging loss of W213 billion for currency risk management of expected export transactions, which has been reclassified to revenue.

Sales organization and sales route

•

As of September 30, 2023, each of our television, IT and mobile businesses had individual sales and customer support functions.

•

Sales subsidiaries in the United States, Germany, Japan, Taiwan, China and Singapore perform sales activities and provide local technical support to customers.

•

Sales of our products take place through one of the following two routes:

1) LG Display Headquarters and overseas manufacturing subsidiaries gOverseas sales subsidiaries (USA/Germany/Japan/Taiwan/China/Singapore), etc. g System integrators and end-brand customers g End users

2) LG Display Headquarters and overseas manufacturing subsidiaries g System integrators and end-brand customers g End users

•

Sales performance by sales route


Sales performance	Sales route⁽¹⁾	Ratio
Overseas	Overseas subsidiaries		95.6	%
Overseas	Headquarters		4.4	%
Overseas sales portion (overseas sales / total sales)			96.8	%
Korea	Overseas subsidiaries		6.2	%
Korea	Headquarters		93.8	%
Korea sales portion (Korea sales / total sales)			3.2	%

(1)	Percentage by sales route is based on revenue from the Display business segment.

Sales methods and sales terms

•

Direct sales and sales through overseas subsidiaries, etc. Sales terms are subject to change depending on the fluctuation in the supply and demand.

Sales strategy

•

With respect to television products, we are expanding the premium television market with our OLED televisions and working towards strengthening our business portfolio and reinforcing consumer values through new businesses such as gaming and transparent products. We are also securing business stability in the LCD market with products that are commercially differentiated while mainly targeting global customers.

•

With respect to IT products, we are securing stable sales by having major global personal computer and home electronics manufacturers as our primary customer base, and we are also continually strengthening the sales of high-resolution, IPS, narrow bezel and other high-end display panels for monitors, notebook computers and tablets.

•

With respect to a wide range of products including smartphones, wearable devices, commercial products (including interactive whiteboards and video wall displays among others), industrial products (including aviation and medical equipment, among others) and automotive display products, we have continued to build a strong and diversified business portfolio and expanded our global customer base by leveraging the strength of our differentiated products that apply plastic OLED, Tandem n, IPS, in-TOUCH, Super Narrow bezel and other technologies to enable higher resolution and higher reliability.

Major customers

•

Customers “A” and “B” each accounted for more than 10% of our sales revenue in the three quarters of 2023 and 2022. Our sales revenue derived from our top ten customers comprised 86% of our total sales revenue in the three quarters of 2023 and 85% in the three quarters of 2022.

6.	Purchase Orders

•

We supply some of our products in accordance with the production plans of automobile manufacturers. However, the volume of our supply is subject to fluctuation depending on the customers’ actual order volume and future market conditions, and it is not possible to accurately predict the changes in demand resulting from changes in the domestic and global economic environment. Moreover, as of September 30, 2023, we do not have purchase order contracts that recognize revenue by measuring progress towards satisfaction of performance obligation by using the cost-based input method.

7.	Risk Management and Derivative Contracts

Risk management

(1)

Major market risks

Our business is exposed to credit risk, liquidity risk and market risk. Accordingly, we operate a risk management system that identifies and analyzes these risks while monitoring and managing risk level by establishing appropriate risk controls in order to ensure that such risks do not exceed certain threshold levels.

Market risk refers to the risk that income from the financial instruments that we hold or the fair value of such financial instruments will fluctuate due to fluctuations in market prices, such as exchange rates, interest rates and prices of equity securities. The objective of our market risk management system is to manage and control our exposure to market risk within an acceptable level while optimizing our profit levels.

(2)

Risk management method

As the average selling prices of OLED and TFT-LCD panels can continue to decline over time irrespective of industry-wide cyclical fluctuations, we may find it hard to manage risks associated with certain factors that are outside our control. However, we counteract such declines in average selling prices by increasing the proportion of high value added panels in our product mix while also implementing various cost reduction measures.

In addition, in order to manage our risk against foreign currency fluctuations, we eliminate such risk by adopting a policy of maintaining our net exposure risk within an acceptable level by buying or selling foreign currencies at spot rates, when necessary, to address short-term imbalances in the inflow and outflow of foreign currency funds. We also continually monitor our currency position and risk for other monetary assets and liabilities denominated in foreign currencies, and when needed, we may from time to time enter into cross-currency interest rate swap contracts and foreign currency forward contracts. Furthermore, we have adopted a policy aimed at minimizing uncertainty and financial costs arising from interest rate fluctuations and manage our interest rate risk through periodic monitoring of interest rate trends and adoption of appropriate countermeasures.

Derivative contracts

(1)

Currency risks

•

We are exposed to currency risks on sales, purchases and borrowings that are denominated in currencies other than in Won, our functional currency. These currencies are primarily the U.S. dollar, the Chinese Yuan and the Japanese Yen.

•

Interest on borrowings is denominated in the currency of the borrowing. Generally, borrowings are denominated in currencies that match the cash flows generated by our underlying operations, primarily in Won, the U.S. dollar and the Chinese Yuan.

•

As of the end of the reporting period, in order to avoid risks of exchange rate fluctuations on the fair value of advance received, we entered into long position currency forward contracts of US$1,200 million with Standard Chartered Bank and others. As of the end of the reporting period, among the valuation gains and losses of derivatives to which fair value hedge accounting is applied, there is no ineffective portion, and we recognized a valuation gain of W20 billion and a valuation loss of W3 billion (purchase commitment: USD 1,200 million, contract exchange rate: W1,289.11~1,310.08) as part of our foreign currency translation gains and losses. With regard to fair value hedging, the maximum expected period of exposure to fair value fluctuation risk from hedged transactions is within 28 months from the end of the reporting period.

•

As of the end of the reporting period, in order to avoid risks of interest rate fluctuations and exchange rate fluctuations on foreign currency denominated borrowings with floating interest rates, we entered into an aggregate of USD 2,065 million and CNY 345 million cross currency swap agreements with KB Kookmin Bank and others, for which we have not applied hedge accounting. Any rights or obligations arising from derivative contracts that do not apply hedge accounting are measured at fair value and are accounted for as assets and liabilities, whereas any resulting valuation gain or loss is recognized as profit or loss at the time such valuation gain or loss is incurred. We recognized a gain on valuation of derivative instruments in the amount of W294 billion and a loss on valuation of derivative instruments in the amount of W200 billion with respect to the above foreign exchange derivative instruments held during the reporting period.

(2)

Interest rate risks

•

Our exposure to interest rate risks relates primarily to our floating rate long term loan obligations. We have established and are managing interest rate risk policies to minimize uncertainty and costs associated with interest rate fluctuations by monitoring cyclical interest rate fluctuations and enacting countermeasures.

•

As of the end of the reporting period, we entered into an aggregate face value of US$1,565 million (equivalent to Won 2,104.6 billion) in cross-currency interest swap agreements with Hana Bank and others, and an aggregate of W990 billion in interest rate swap agreements with China Construction Bank and others, for which we have not applied hedge accounting. We recognized a gain on valuation of derivative instruments in the amount of W2 billion and a loss on valuation of derivative instruments in the amount of W1 billion with respect to our interest rate derivative instruments held during the reporting period.

•

We are managing the transition to alternative benchmark reference rates through the insertion of replacement clauses for financial instruments tied to interbank lending rates (“IBORs”) that have not yet been converted. As of September 30, 2023, the remaining financial instruments tied to IBORs which we are exposed to will be replaced from USD London Interbank Offered Rate (LIBOR) rates to the Secured Overnight Financing Rates (SOFR) in accordance with certain replacement guidelines. Even if a replacement clause has been inserted, if the interest rate of the financial instrument is still tied to an IBOR, we consider such financial instrument as not yet having been converted.

8.	Major Contracts

Our material contracts, other than contracts entered into in the ordinary course of business, are set forth below:


Type of agreement	Name of party	Term	Content
Technology licensing/supply agreement	Hewlett-Packard	January 2011 ~	Patent licensing of semi-conductor device technology
	Ignis Innovation, Inc.	July 2016 ~	Patent licensing of OLED related technology
	HannStar Display Corporation	December 2013 ~	Patent cross-licensing of LCD technology
	AU Optronics Corporation	August 2011~	Patent cross-licensing of LCD technology
	Innolux Corporation	July 2022 ~	Patent cross-licensing of LCD technology
	Universal Display Corporation	January 2015 ~ December 2025	Patent licensing of OLED related technology
	Semiconductor Energy Laboratory	January 2021 ~ December 2030	Patent licensing of LCD and OLED related technology

9.	Research & Development (“R&D”)

Summary of R&D-related expenditures


		(Unit: In millions of Won, except percentages)
Items		2023 Q1~Q3	2022			2021
R&D Expenditures (prior to deducting governmental subsidies)		1,827,983		2,431,590			2,127,705
Governmental Subsidies		(334)		(1,008	)		(941	)

Net R&D-Related Expenditures		1,827,649		2,430,582			2,126,764

Accounting Treatment⁽¹⁾	R&D Expenses	1,436,283		1,927,828			1,813,876
Accounting Treatment⁽¹⁾	Development Cost (Intangible Assets)	391,366		502,754			312,888

R&D-Related Expenditures / Revenue Ratio⁽²⁾ (Total R&D-Related Expenditures ÷ Revenue for the period × 100)		13.1%		9.3	%		7.1	%

(1)	For accounting treatment purposes, R&D expenses are presented as research and development expenses in our statements of comprehensive income, net of amortization of capitalized intangible asset development costs.

(2)	Calculated based on the R&D-related expenditures before subtracting government subsidies (state subsidies).

R&D achievements

Achievements in 2021

(1)

Developed the world’s first bendable OLED television display product (65” UHD)

•

Implemented both flat and bendable forms based on the scene usage and provided diverse form factors to customers

(2)

Developed the world’s first 83” OLED television display product

•

Increased the range of options for customers by developing the new 83” UHD

(3)

Developed the world’s first QHD 240Hz gaming notebook product (15.6”)

•

Developed the world’s first QHD resolution 240Hz high-speed notebook product (obtained panel characteristics through new design and process optimization)

•

Led the QHD high-speed gaming product market

(4)

Developed the world’s first high contrast ratio 2000:1 monitor product (27”, 31.5”)

•

Developed the world’s first IPS contrast ratio 2000:1 monitor product through the development of high contrast nega-LC material (Existing product: posi-LC, 1000:1)

•

Led the high-end display quality product market

(5)

Developed the world’s first 42” OLED television display product

•

Expanded the product segment by developing the new 42” UHD display panel

(6)

Developed our first Auto LCD 750R extreme curvature product (12.66” FHD)

•

Achieved differentiated design by developing LTPS 750R extreme curvature product

Achievements in 2022

(1)

Developed the world’s first 16:18 aspect ratio monitor product (27.6” SDQHD)

•

Developed a 27.6” (21.5”, 21.5”, vertical arrangement) monitor product, which is optimized for multi-tasking amid the increase in working remotely as a result of the COVID-19 pandemic

•

Created a new market through the development of a new aspect ratio (16:18, 2560x2880) product

(2)

Developed our first three-sided “Borderless” notebook panel product (13.4” WU XPS)

•

Led the high-end market by adopting a new, three-sided borderless design applying low power consumption variable refresh rate technology

(3)

Developed the world’s first 97” OLED TV product

•

Developed a product that outperforms competitors’ products both in display quality and in size in the high-end market

•

Strengthened the global trend towards OLED dominance by expanding our extra-large OLED TV product lineup and secured related original technology

(4)

Developed the world’s first Curved 1,900R Black monitor product (34”)

•

Developed the world’s first IPS Black Curved monitor product (contrast ratio 2000:1) by utilizing nega-LC material

•

Led the high-end Curved product market

(5)

Developed our first 12.3” cluster product utilizing VDA 3D technology

•

Utilizing VDA (Viewing Distance Adaption) technology, developed a 12.3” cluster product that applies glassless 3D technology and changes the user’s viewing distance while driving

(6)

Developed the world’s first 12.3” cluster product utilizing DLC technology

•

Utilizing DLC (Double LGP Control) technology, developed a 12.3” cluster product which display is, when positioned in the passenger seat, visually recognizable from the passenger seat but not from the driver’s seat.

(7)

Developed the world’s first META technology-applied product (gaming products: 27”, 45”; and television products: 4K 77/65/55”, 8K 77”)

•

Utilizing the development of META OLED technology, entered the gaming monitor market and strengthened flagship leadership in the premium TV market

1) Gaming product (27”, 45”): Secured high PPI luminance performance based on the META technology and provided a display optimized for gaming through high-speed (240 Hz), fast response time (0.03ms) and curved technology

2) Large television (4K/8K): Developed product with world’s best picture quality (luminance/viewing angle) based on META technology

(8)

Developed the world’s first IPS Gaming FHD 480Hz monitor product (24.5”)

•

Applied high-performance Oxide-TFT BCE-4 cell to 480Hz FHD screens

•

Received the 2023 CES Award in Best Innovation / Gaming / Computer Accessory category

Achievements in 2023

(1)

Developed the world’s first small- and medium-sized transparent WOLED product (30” HD)

•

Expanded market coverage with the development of a new product size (30”) for transparent small- and medium-sized display

•

Strengthened market leadership through achieving a transparency rate of 45% and increased luminance (600/200 nit)

(2)

Introduced the world’s first foldable pen touch notebook (17”)

•

Developed OLED panel for notebooks utilizing differentiated technologies such as the tandem OLED and a special folding structure

10.

Intellectual Property

As of September 30, 2023, our cumulative patent portfolio (including patents that have already expired) included 27,275 patents in Korea and 33,662 patents in other countries. In the first three quarters of 2023, we registered 1,782 patents in Korea and 1,662 patents in other countries.

11.

Environmental and Safety Matters

In order to minimize the environmental impact of our business activities, we are actively responding to environmental regulations applicable to our products and business sites.

Business environment management

We have installed and operate various types of prevention facilities to minimize the emission of environmental pollutants generated in our production process. With respect to air and water pollutants, we set and manage our internal standard at 70% of the permitted levels under the regulatory emission standards. In addition, in order to establish a resource circulation system, we operate a proprietary system to monitor waste from its generation to treatment, have developed waste treatment technology and identified suitable recycling companies to reduce the amount of waste we generate and maximize recycling.

In addition, as we were designated a target company for the greenhouse gas emission trading system in 2015, we allocate and monitor our greenhouse gas emissions every year. In order to continually promote the reduction of greenhouse gas emissions, we have set a medium- to long-term goal to reduce the emission level by continually investing in facility improvements and monitoring our emission levels.

We are subject to a variety of environmental laws and regulations, and operations at our manufacturing plants are subject to regulation and periodic scheduled and unscheduled on-site inspections by the Ministry of Environment and local environmental protection authorities. The primary types of environmental laws applicable to us include the following:

(1)

Environmental pollutant emission regulations: Clean Air Conservation Act, Water Quality Conservation Act, Wastes Control Act, Environmental Impact Assessment Act, etc.

(2)

Greenhouse gas emission management: Framework Act on Carbon Neutral and Green Growth to Respond to Climate Crisis, Act on the Allocation and Trading of Greenhouse Gas Emission Permits, etc.

(3)

Other workplace environment management: Chemicals Control Act, Chemicals Registration and Evaluation Act, Soil Environment Conservation Act, etc.

Through the implementation of an environmental and energy management system, we are continuously making efforts to minimize environmental impact and reduce energy usage in all aspects of our business process. Accordingly, we have acquired and currently operate the environmental management system ISO14001 for all of our domestic and overseas production sites, and we have also obtained energy management system ISO 50001 certifications for our domestic business sites and overseas subsidiaries in Guangzhou, Nanjing and Yantai in order to build a sustainable management system. In addition, we have established company-wide safety, healthy, energy and environment management policies and manuals, which are regularly updated based on international standards. We also conduct systematic management of our business process in accordance with international standards through annual follow-up and renewal audits.

In recognition of our efforts, we were awarded the highest level, Leadership A, and received the grand prize award at the CDP Water Korea Best Awards in 2016 from the Carbon Disclosure Project, which was presided over by the Carbon Disclosure Project Korea Committee. Since then, we have continued to maintain our excellence in water conservation activities and received Leadership A recognition from 2018 to 2022. In addition, we have also received the Carbon Management Honors Club award from 2017 to 2020 and the Carbon Management Sector Honors every year since 2016 in recognition of our continued greenhouse gas emission reduction activities.

In addition, in recognition of our efforts toward recycling rate improvement and waste reduction, we were nominated as a leading company with an excellent performance in resource circulation and received a commendation from the Minister of Environment in 2020. Our overseas subsidiary in Yantai earned Platinum Zero Waste to Landfill (“ZWTL”) validation in 2021, and all of our domestic production facilities earned Gold ZWTL validation (above 95% recycling rate), and our overseas subsidiary in Nanjing earned Platinum validation in 2022. In 2022, we introduced a resource recirculation recognition program in accordance with the Korean government’s waste management policy and received circular resource certification on eight types of our discarded trays and vinyl. We will continue our efforts to reinforce our resource circulation program by minimizing waste and maximizing recycling rate.

Moreover, in line with the global trend for environmental, social, and governance (“ESG”) management, we earned Gold rating (which recognizes top 5% companies) in the ESG assessment conducted by global research center EcoVadis. We have continued to pursue ESG management activities based on the spirit of “value creation for consumers” and “human-first management,” and we plan to obtain further recognition for our eco-friendly management and share relevant information with the stakeholders.

Product environment management

In order to respond to applicable domestic and overseas environmental regulations, such as the European Union’s Restriction of Hazardous Substances (RoHS) and Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) that restrict the use of certain hazardous substances, we operate a hazardous substance management program that implements a four-step procedure (each such step, a “Gate”) that manages various stages of our production cycle, beginning with the registration process of our business partners up to the mass production stage. In addition, in order to preemptively address four types of phthalate substances that became additionally regulated pursuant to the RoHS in 2016 and officially went into effect on July 22, 2019, we replaced the latent risk elements in advance as well as implemented a more stable management process with respect to such substances. In implementing this process, we collaborated with external agencies to ascertain regulatory trends and establish our response strategy, and we formulated and applied effective management measures through the collaborative efforts of our development, procurement, quality assurance and analysis teams.

•

Gate 01 (Business Partner Stage): An audit is conducted prior to the registration of a new business partner (including the inspection of the business partner’s hazardous substance response process)

•

Gate 02 (Parts Development Stage): An environmental evaluation of each part under development is conducted (consisting of three stages: (1) document review; (2) XRF test and (3) precision analysis)

•

Gate 03 (Product Development Stage): An environmental evaluation of the product model and product labeling are conducted (including RoHS verification)

•

Gate 04 (Mass Production Stage): Process management through the periodic testing of mass-produced parts for any hazardous substances (including rate-based tests based on risk assessment)

We operate a “Hazardous Substance Management System for Products” that effectively manages hazardous substances by classifying them into four levels: A-I, A-II, B-I, and B-II. In particular, in addition to substances prohibited by global hazardous substance regulations on products, we have designated substances causing harm to the human body and the environment as Level B substances. By developing alternative technologies and parts and applying them to our products, we continually strive to achieve a gradual reduction and elimination of non-prohibited hazardous substances.

•

Level A-I (Prohibited Substances): Prohibited substances designated under the RoHS regulations (i.e., 10 regulated substances) and those designated by specific customers

•

Level A-II (Prohibited Substances): Substances prohibited by regulations and conventions other than those covered under Level A-1 and those designated as such by customers

•

Level B-I (Substances Subject to Voluntary Reduction): Substances that are being voluntarily replaced over a certain period of time

•

Level B-II (Substances Under Observation): Substances that are not currently banned, but are expected to become prohibited in the future

Moreover, we participated in reforming IEC 62321, an international testing standard published by the International Electrotechnical Commission and used by RoHS, and the commission adopted our halogen-free combustion ion chromatography method in as IEC 62321-3-2, which was published in June 2013.

In 2017, in a joint effort with the global product testing/accreditation agency SGS, we became the first display panel company to develop SGS Eco Label, an environmentally friendly accreditation program for television display modules, and have since continuously received the SGS Eco Label accreditation for our OLED television models. In 2022, we expanded our accreditation program to cover display modules for monitors, notebook computers, tablets and automobiles, as a result of which our display modules for monitors and notebook computers received SGS Eco Label accreditation for the first time and our automotive display module became the first in the industry to receive the SGS Eco Label accreditation for its excellence in energy efficiency. In 2023, our high-end IT LCD panels (27-inch and under), in which we incorporated recycled materials for the first time, received the SGS Eco Label accreditation. In addition, our 30-inch and 55-inch transparent display products, for which we applied hazardous substance reduction technology, became the first in the industry to receive the SGS Eco Label accreditation. Moreover, in 2022, our 27-inch monitor display product that applied anti-bacterial films received the SGS Performance Mark accreditation for its anti-bacterial performance, and in 2023, our commercial display module that applied Plus-Bright energy consumption reduction technology obtained the SGS Performance Mark accreditation for its energy efficiency performance. Our high-end IT panels (27-inch and smaller) also received the same accreditation for reducing energy consumption through the implementation of proprietary algorithms and improving panel transmittance.

Also in 2022, upon assessment and verification of GHG emissions throughout its entire product life cycle, our OLED TV panel received the industry’s first Carbon Footprint Certification from The Carbon Trust, a not-for-profit company founded by the United Kingdom government that provides voluntary carbon certification services and carbon labeling schemes. In 2023, our high-end IT LCD panels (27-inch and smaller) received the Product Carbon Footprint (PCF) certification from TÜV Rheinland, a global independent testing, inspection and certification agency, by achieving carbon emission reduction through the application of recycled materials and low energy consumption technologies.

In 2021, we received the “Green Technology Certification” for our advanced incell touch display technology, an eco-friendly technology with touch-sensing electrodes and transmission lines that reduce carbon emissions and the use of rare metals. We also obtained an eco-friendly certification from TUV SUD, a globally recognized accreditation agency, for excellence in resource circulation and non-use of specific hazardous substances in our OLED television and PO mobile models, following our co-development of such certification program with such agency.

In 2018, we became the first display panel company to receive the “Green Technology Certification” from the Korean Ministry of Science and ICT for improving the light efficiency technology of OLED to promote energy use reduction. In 2017, for the IPS Nano Color for LCD, we received the Quality & Performance Mark from Intertek, a global product testing/accreditation agency, by applying a technology to eliminate cadmium (Cd) and indium phosphide (InP).

Green Management

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

Status of sanctions

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

12.

Financial Information

Financial highlights (Based on consolidated K-IFRS).


	(Unit: In millions of Won)
Description	As of September 30, 2023		As of December 31, 2022		As of December 31, 2021
Current assets		10,506,293		9,444,035		13,187,067
Quick assets		7,157,751		6,571,117		9,836,692
Inventories		3,348,542		2,872,918		3,350,375
Non-current assets		27,031,439		26,241,984		24,967,448
Investments in equity accounted investees		94,085		109,119		126,719
Property, plant and equipment, net		20,953,320		20,946,933		20,558,446
Intangible assets		1,735,328		1,752,957		1,644,898
Other non-current assets		4,248,706		3,432,975		2,637,385
Total assets		37,537,732		35,686,019		38,154,515
Current liabilities		14,559,786		13,961,520		13,994,817
Non-current liabilities		14,087,754		10,405,272		9,397,197
Total liabilities		28,647,540		24,366,792		23,392,014
Share capital		1,789,079		1,789,079		1,789,079
Share premium		2,251,113		2,251,113		2,251,113
Retained earnings		2,567,284		5,359,769		8,541,521
Other equity		699,124		479,628		537,142
Non-controlling interest		1,583,592		1,439,638		1,643,646
Total equity		8,890,192		11,319,227		14,762,501


(Unit: In millions of Won, except for per share data and number of consolidated entities)
Description	For the nine months ended September 30, 2023			For the year ended December 31, 2022			For the year ended December 31, 2021
Revenue		13,934,914			26,151,781			29,878,043
Operating profit (loss)		(2,641,908	)		(2,085,047	)		2,230,608
Profit (loss) from continuing operations		(2,627,268	)		(3,195,585	)		1,333,544
Profit (loss) for the period		(2,627,268	)		(3,195,585	)		1,333,544
Profit (loss) attributable to:
Owners of the company		(2,791,928	)		(3,071,565	)		1,186,182
Non-controlling interest		164,660			(124,020	)		147,362
Basic earnings (loss) per share		(7,803	)		(8,584	)		3,315
Diluted earnings (loss) per share		(7,803	)		(8,584	)		3,130
Number of consolidated entities		22			22			22

Financial highlights (Based on separate K-IFRS).


	(Unit: In millions of Won)
Description	As of September 30, 2023		As of December 31, 2022		As of December 31, 2021
Current assets		5,655,444		5,627,177		8,566,656
Quick assets		3,335,553		3,702,583		6,435,659
Inventories		2,319,891		1,924,594		2,130,997
Non-current assets		24,589,554		23,631,862		20,911,466
Investments		5,061,695		4,837,704		4,942,729
Property, plant and equipment, net		13,929,948		14,044,844		12,010,858
Intangible assets		1,638,906		1,635,181		1,459,812
Other non-current assets		3,959,005		3,114,133		2,498,067
Total assets		30,244,998		29,259,039		29,478,122
Current liabilities		16,077,680		16,043,011		13,148,969
Non-current liabilities		8,407,614		5,865,589		5,686,335
Total liabilities		24,485,294		21,908,600		18,835,304
Share capital		1,789,079		1,789,079		1,789,079
Share premium		2,251,113		2,251,113		2,251,113
Retained earnings		1,719,512		3,310,247		6,611,853
Other equity		0		0		(9,227	)
Total equity		5,759,704		7,350,439		10,642,818


	(Unit: In millions of Won, except for per share data)
Description	For the nine months ended September 30, 2023			For the year ended December 31, 2022			For the year ended December 31, 2021
Revenue		12,960,038			24,131,172			28,364,914
Operating profit (loss)		(3,666,515	)		(3,201,463	)		721,931
Profit (loss) from continuing operations		(1,589,998	)		(3,191,387	)		552,173
Profit (loss) for the period		(1,589,998	)		(3,191,387	)		552,173
Basic earnings (loss) per share		(4,444	)		(8,919	)		1,543
Diluted earnings (loss) per share		(4,444	)		(8,919	)		1,540

Consolidated subsidiaries (as of September 30, 2023)


Company Interest	Primary Business	Location	Equity
LG Display America, Inc.	Sales	U.S.A.		100	%
LG Display Germany GmbH	Sales	Germany		100	%
LG Display Japan Co., Ltd.	Sales	Japan		100	%
LG Display Taiwan Co., Ltd.	Sales	Taiwan		100	%
LG Display Nanjing Co., Ltd.	Manufacturing	China		100	%


Company Interest	Primary Business	Location	Equity
LG Display Shanghai Co., Ltd.	Sales	China		100	%
LG Display Guangzhou Co., Ltd.	Manufacturing	China		100	%
LG Display Shenzhen Co., Ltd.	Sales	China		100	%
LG Display Singapore Pte. Ltd.	Sales	Singapore		100	%
L&T Display Technology (Fujian) Limited	Manufacturing and sales	China		51	%
LG Display Yantai Co., Ltd.	Manufacturing	China		100	%
LG Display (China) Co., Ltd.	Manufacturing and sales	China		70	%
Nanumnuri Co., Ltd.	Workplace services	Korea		100	%
Unified Innovative Technology, LLC	Managing intellectual property	U.S.A.		100	%
Global OLED Technology LLC	Managing intellectual property	U.S.A.		100	%
LG Display Guangzhou Trading Co., Ltd.	Sales	China		100	%
LG Display Vietnam Haiphong Co., Ltd.	Manufacturing	Vietnam		100	%
Suzhou Lehui Display Co., Ltd.	Manufacturing and sales	China		100	%
LG Display Fund I LLC⁽¹⁾	Investing in new emerging companies	U.S.A		100	%
LG Display High-Tech (China) Co., Ltd.	Manufacturing and sales	China		70	%

(1)	During the reporting period, we invested an additional W4,691 million in LG Display Fund I LLC.

Status of equity investments (as of September 30, 2023)

(1)

Consolidated subsidiaries

Company

Capital Stock
(in millions)

Date of
Incorporation

Equity
Interest

LG Display America, Inc.

USD 411

September 1999

100

LG Display Germany GmbH

EUR 1

October 1999

100

LG Display Japan Co., Ltd.

JPY 95

October 1999

100

LG Display Taiwan Co., Ltd.

TWD 116

April 1999

100

LG Display Nanjing Co., Ltd.

CNY 3,020

July 2002

100

LG Display Shanghai Co., Ltd.

CNY 4

January 2003

100

LG Display Guangzhou Co., Ltd.

CNY 1,655

June 2006

100

LG Display Shenzhen Co., Ltd.

CNY 4

July 2007

100

LG Display Singapore Pte. Ltd.

USD 1

November 2008

100

L&T Display Technology (Fujian) Limited

CNY 116

December 2009

LG Display Yantai Co., Ltd.

CNY 1,008

March 2010

100

Nanumnuri Co., Ltd.

KRW 800

March 2012

100

LG Display (China) Co., Ltd.

CNY 8,232

December 2012

Unified Innovative Technology, LLC

USD 9

March 2014

100

LG Display Guangzhou Trading Co., Ltd.

CNY 1

April 2015

100

Global OLED Technology LLC

USD 138

December 2009

100

LG Display Vietnam Haiphong Co., Ltd.

USD 600

May 2016

100

Suzhou Lehui Display Co., Ltd.

CNY 637

July 2016

100

LG Display Fund I LLC⁽¹⁾

USD 75

May 2018

100

LG Display High-Tech (China) Co., Ltd.

CNY 15,600

July 2018

(1)	During the reporting period, we invested an additional W4,691 million in LG Display Fund I LLC.

(2)

Affiliated companies


Company	Carrying Amount (in millions)		Date of Incorporation		Equity Interest
Paju Electric Glass Co., Ltd.	W	29,034		January 2005		40	%
Wooree E&L Co., Ltd.	W	12,336		June 2008		13	%
YAS Co., Ltd.	W	28,358		April 2002		15	%
Avatec Co., Ltd.	W	21,385		August 2000		14	%
Arctic Sentinel, Inc.		—		June 2008		10	%
Cynora GmbH		—		March 2003		10	%
Material Science Co., Ltd.	W	2,972		January 2014		10	%

Although our respective share interests in Wooree E&L Co., Ltd., YAS Co., Ltd., Avatec Co., Ltd., Arctic Sentinel, Inc., Cynora GmbH and Material Science Co., Ltd. are below 20%, we are able to exercise significant influence through our right to appoint a director to the board of directors of each investee. Accordingly, the investments in these investees have been accounted for using the equity method.

For the nine months ended September 30, 2023 and 2022, the aggregate amount of dividends we received from our affiliated companies was W15,200 million and W4,461 million, respectively.

13.

Audit Information

Audit service


	(Unit: In millions of Won, hours)
Description	2023 Q3	2022	2021
Auditor	KPMG Samjong	KPMG Samjong	KPMG Samjong
Activity	Audit by independent auditor	Audit by independent auditor	Audit by independent auditor
Compensation⁽¹⁾	1,640 (590)⁽²⁾	1,557 (575)⁽²⁾	1,470 (550)⁽²⁾
Time required⁽³⁾	11,601	21,238	20,821

(1)	Compensation amount is the contracted amount for the full fiscal year.

(2)	Compensation amount in ( ) is for Form 20-F filing and SOX 404 audit.

(3)	Figures are based on actual performance as of the date of this report.

Non-audit service


	(Unit: In millions of Won, hours)
Period	Date of contract	Description of service	Period of service		Compensation
2023 Q3	—	—		—	—
2022	—	—		—	—
2021	—	—		—	—

*	Based on direct contracts on a separate basis.

14.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

This information is omitted in quarterly and semi-annual reports in accordance with Korean disclosure rules, and we plan to include such information in our annual report.

15.

Board of Directors

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

16.

Information Regarding Shares

Total number of shares

(1)

Total number of shares authorized to be issued (as of September 30, 2023): 500,000,000 shares.

(2)

Total shares issued and outstanding (as of September 30, 2023): 357,815,700 shares.

Shareholder list

(1)

Largest shareholder and related parties as of September 30, 2023:


Name	Relationship	Number of shares of common stock		Equity interest
LG Electronics	Largest shareholder		135,625,000		37.90	%
James (Hoyoung) Jeong	Registered director of member company		15,000		0.00	%

(2)

Shareholders who are known to us that own 5% or more of our shares as of December 31, 2022⁽¹⁾:


Beneficial owner	Number of shares of common stock		Equity interest
LG Electronics		135,625,000		37.90	%

(1)	Based on the public disclosure filing of the National Pension Service on April 24, 2023, the National Pension Service held 19,362,894 shares of our common stock, which resulted in a change in its equity interest in us to 5.41%.

17.

Directors and Employees

Directors

(1)

List of Members of Board of Directors

Name

Position

Shares of the
Company held

First
appointed

Term expires

James (Hoyoung) Jeong

Representative Director (non-outside), Chief Executive Officer and President

15,000

September 17, 2019

March 20, 2026

Sung Hyun Kim

Director (non-outside), Chief Financial Officer and Senior Vice President

—

December 1, 2018

March 23, 2025

Beom Jong Ha

Non-standing Director and Member of Outside Director Nomination Committee

—

March 23, 2022

March 23, 2025

Doocheol Moon

Outside Director and Member of Audit Committee, Related Party Transaction Committee and ESG Committee

—

March 23, 2021

March 23, 2024

Chung Hae Kang

Outside Director and Member of Audit Committee, Outside Director Nomination Committee, Related Party Transaction Committee and ESG Committee

—

March 23, 2022

March 23, 2025

Jungsuk Oh

Outside Director and Member of Audit Committee, Outside Director Nomination Committee, Related Party Transaction Committee and ESG Committee

—

April 26, 2022

March 21, 2026

Sang Hee Park

Outside Director and Member of Audit Committee and ESG Committee

—

March 21, 2023

March 21, 2026

(2)

Compensation of Directors

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

Employees

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

18.

Other Matters

Legal proceedings

We are a defendant in two separate civil lawsuits (comprising one damages claim in the United Kingdom filed by private plaintiffs and one damages claim in Israel filed by private plaintiffs) filed against us and certain other TFT-LCD panel manufacturers in connection with alleged anticompetitive behavior of the defendants. In each of these cases, the amount being sought has not been determined. A trial for the case in the United Kingdom was under progress in October 2023, but no trial has been scheduled for the case in Israel. While the expected outcome of each of these cases is unclear, we do not believe that any of these cases would have a material effect on our financial conditions.

Status of collateral pledged to related party

In March 2023, we entered into an agreement to obtain a long-term borrowing from LG Electronics, our largest shareholder, in the aggregate amount of W1 trillion with an interest rate of 6.06% per year. We received W0.65 trillion of the principal amount of such borrowing on March 30, 2023 and the remaining W0.35 trillion on April 20, 2023. We are responsible only for interest payments during the first two years of the borrowing term, while the principal amount is subject to repayment on a quarterly basis during the final year, until its maturity on March 30, 2026. We obtained such borrowing in order to strengthen the competitiveness of our OLED business as well as for general corporate purposes. In addition, as an ancillary, we pledged certain of our land and buildings equal to the sum of the principal and interest amount as collateral for such borrowing.

Moreover, deposits in the amount of CNY4,288 million (equivalent to W790.1 billion) have been pledged as collateral by LG Display Nanjing Co., Ltd. in connection with our borrowings in the amount of USD 200 million (equivalent to W269.0 billion) and W450 billion from Shinhan Bank and others.

Material events subsequent to the reporting period

This information is omitted in quarterly reports in accordance with Korean disclosure rules, and we plan to include such information in our semi-annual and annual reports.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Interim Financial Statements

(Unaudited)

September 30, 2023 and 2022

(With Independent Auditors’ Review Report Thereon)

Table of Contents


	Page

Independent Auditors’ Review Report		28

Condensed Consolidated Interim Statements of Financial Position		30

Condensed Consolidated Interim Statements of Comprehensive Loss		31

Condensed Consolidated Interim Statements of Changes in Equity		32

Condensed Consolidated Interim Statements of Cash Flows		33

Notes to the Condensed Consolidated Interim Financial Statements		35

Independent Auditors’ Review Report

Based on a report originally issued in Korean

To the Board of Directors and Shareholders

LG Display Co., Ltd.:

Reviewed Financial Statements

We have reviewed the accompanying condensed consolidated interim financial statements of LG Display Co., Ltd. and subsidiaries (the “Group”) which comprise the condensed consolidated interim statement of financial position as of September 30, 2023, the condensed consolidated interim statements of comprehensive loss for the three-month and nine-month periods ended September 30, 2023 and 2022, and statements of changes in equity and cash flows for the nine-month periods ended September 30, 2023 and 2022, and notes comprising material accounting policy information and other explanatory information.

Management’s Responsibility for the Condensed Consolidated Interim Financial Statements

Management is responsible for the preparation and fair presentation of these condensed consolidated interim financial statements in accordance with Korean International Financial Reporting Standards No. 1034, Interim Financial Reporting, and for such internal controls as management determines necessary to enable the preparation of condensed consolidated interim financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to issue a report on these condensed consolidated interim financial statements based on our reviews.

We conducted our reviews in accordance with the Review Standards for Quarterly and Semiannual Financial Statements established by the Security and Futures Commission of the Republic of Korea. A review of interim financial information consists principally of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Korean Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our reviews, nothing has come to our attention that causes us to believe that the condensed consolidated interim financial statements referred to above are not presented fairly, in all material respects, in accordance with Korean International Financial Reporting Standards No. 1034, Interim Financial Reporting.

Other Matters

The procedures and practices utilized in the Republic of Korea to review such condensed consolidated interim financial statements may differ from those generally accepted and applied in other countries.

We audited the consolidated statement of financial position as of December 31, 2022 and the related consolidated statements of comprehensive loss, changes in equity and cash flows for the year then ended, which are not accompanying this review report, in accordance with Korean Standards on Auditing, and our report thereon, dated March 3, 2023, expressed an unmodified opinion. The accompanying condensed consolidated statement of financial position of the Group as of December 31, 2022, presented for comparative purposes, is not different from that audited by us from which it was derived in all material respects.

KPMG Samjong Accounting Corp.

Seoul, Korea

November 13, 2023

This report is effective as of November 13, 2023, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying condensed consolidated interim financial statements and notes thereto. Accordingly, the readers of the review report should understand that the above review report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Interim Statements of Financial Position

(Unaudited)

As of September 30, 2023 and December 31, 2022


(In millions of won)	Note		September 30, 2023		December 31, 2022
Assets
Cash and cash equivalents		4, 26	W	3,006,210		1,824,649
Deposits in banks		4, 26		1,081,106		1,722,607
Trade accounts and notes receivable, net		5, 15, 26, 28		2,351,050		2,358,914
Other accounts receivable, net		5, 26		83,266		169,426
Other current financial assets		6, 26		269,644		165,355
Inventories		7		3,348,542		2,872,918
Prepaid income taxes				30,675		5,275
Other current assets		5		335,800		324,891

Total current assets				10,506,293		9,444,035
Deposits in banks		4, 26		11		11
Investments in equity accounted investees		8		94,085		109,119
Other non-current financial assets		6, 26		232,262		289,098
Property, plant and equipment, net		9, 18		20,953,320		20,946,933
Intangible assets, net		10, 18		1,735,328		1,752,957
Investment property		11		34,279		28,269
Deferred tax assets		24		3,590,660		2,645,077
Defined benefits assets, net		13		366,497		447,521
Other non-current assets				24,997		22,999

Total non-current assets				27,031,439		26,241,984

Total assets			W	37,537,732		35,686,019

Liabilities
Trade accounts and notes payable		26, 28	W	4,702,473		4,061,684
Current financial liabilities		12, 26, 27		5,452,558		5,489,254
Other accounts payable		26		2,967,116		3,242,929
Accrued expenses				716,722		729,193
Income tax payable				67,144		112,429
Provisions		14		126,624		173,322
Advances received		15		444,406		65,069
Other current liabilities				82,743		87,640

Total current liabilities				14,559,786		13,961,520
Non-current financial liabilities		12, 26, 27, 28		12,124,094		9,622,352
Non-current provisions		14		65,511		86,157
Defined benefit liabilities, net		13		1,385		1,531
Long-term advances received		15		1,210,320		—
Deferred tax liabilities		24		2,835		4,346
Other non-current liabilities		26		683,609		690,886

Total non-current liabilities				14,087,754		10,405,272

Total liabilities				28,647,540		24,366,792

Equity
Share capital		16		1,789,079		1,789,079
Share premium		16		2,251,113		2,251,113
Retained earnings				2,567,284		5,359,769
Reserves		16		699,124		479,628

Total equity attributable to owners of the Controlling Company				7,306,600		9,879,589

Non-controlling interests				1,583,592		1,439,638

Total equity				8,890,192		11,319,227

Total liabilities and equity			W	37,537,732		35,686,019

See accompanying notes to the condensed consolidated interim financial statements.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Interim Statements of Comprehensive Loss

(Unaudited)

For the three-month and nine-month periods ended September 30, 2023 and 2022


(In millions of won, except earnings per share)	Note	For the three-month periods ended September 30						For the nine-month periods ended September 30
		2023			2022			2023			2022
Revenue	17, 18, 28	W	4,785,287			6,771,355			13,934,914			18,850,153
Cost of sales	7, 19, 28		(4,747,957	)		(6,720,587	)		(14,453,640	)		(17,706,000	)

Gross profit (loss)			37,330			50,768			(518,726	)		1,144,153
Selling expenses	19, 20		(132,751	)		(221,406	)		(418,510	)		(672,450	)
Administrative expenses	19, 20		(220,526	)		(239,064	)		(665,678	)		(690,547	)
Research and development expenses	19		(346,133	)		(349,604	)		(1,038,994	)		(990,461	)

Operating loss			(662,080	)		(759,306	)		(2,641,908	)		(1,209,305	)

Finance income	23		183,229			540,585			1,008,030			1,145,259
Finance costs	23		(346,180	)		(586,507	)		(1,302,241	)		(1,147,324	)
Other non-operating income	22		237,719			1,142,592			1,071,053			2,283,006
Other non-operating expenses	19, 22		(421,353	)		(1,435,451	)		(1,494,633	)		(2,648,473	)
Equity in income of equity accounted investees, net			2,204			(722	)		1,269			3,375

Loss before income tax			(1,006,461	)		(1,098,809	)		(3,358,430	)		(1,573,462	)
Income tax benefit	24		(231,063	)		(324,778	)		(731,162	)		(471,678	)

Loss for the period			(775,398	)		(774,031	)		(2,627,268	)		(1,101,784	)

Other comprehensive income (loss)
Items that will never be reclassified to profit or loss
Remeasurements of net defined benefit liabilities	13		46			(4,960	)		(737	)		143,521
Other comprehensive income (loss) from associates			12			(19	)		180			32

			58			(4,979	)		(557	)		143,553
Items that are or may be reclassified to profit or loss
Foreign currency translation differences for foreign operations	16		155,199			463,175			234,110			845,523
Loss on valuation of derivative			—			(25,252	)		—			(68,051	)
Other comprehensive loss from associates	16		(555	)		(5,644	)		(1,222	)		(9,503	)

			154,644			432,279			232,888			767,969

Other comprehensive income (loss) for the period, net of income tax			154,702			427,300			232,331			911,522

Total comprehensive loss for the period		W	(620,696	)		(346,731	)		(2,394,937	)		(190,262	)

Loss attributable to:
Owners of the Controlling Company			(720,026	)		(789,511	)		(2,791,928	)		(1,174,075	)
Non-controlling interests			(55,372	)		15,480			164,660			72,291

Loss for the period		W	(775,398	)		(774,031	)		(2,627,268	)		(1,101,784	)

Total comprehensive loss attributable to:
Owners of the Controlling Company			(592,554	)		(423,527	)		(2,572,989	)		(380,033	)
Non-controlling interests			(28,142	)		76,796			178,052			189,771

Total comprehensive loss for the period		W	(620,696	)		(346,731	)		(2,394,937	)		(190,262	)

Loss per share (in won)
Basic loss per share	25	W	(2,012	)		(2,206	)		(7,803	)		(3,281	)

Diluted loss per share	25	W	(2,012	)		(2,206	)		(7,803	)		(3,370	)

See accompanying notes to the condensed consolidated interim financial statements.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Interim Statements of Changes in Equity

(Unaudited)

For the nine-month periods ended September 30, 2023 and 2022


	Attributable to owners of the Controlling Company
(In millions of won)	Share capital		Share premium		Retained earnings			Reserves			Sub-total			Non-controlling interests			Total equity
Balances at January 1, 2022	W	1,789,079		2,251,113		8,541,521			537,142			13,118,855			1,643,646			14,762,501

Total comprehensive income (loss) for the period
Profit (loss) for the period		—		—		(1,174,075	)		—			(1,174,075	)		72,291			(1,101,784	)
Other comprehensive income (loss)
Remeasurements of net defined benefit liabilities, net of tax		—		—		143,521			—			143,521			—			143,521
Foreign currency translation differences		—		—		—			728,043			728,043			117,480			845,523
Other comprehensive income (loss) from associates		—		—		32			(9,503	)		(9,471	)		—			(9,471	)
Loss on valuation of derivative		—		—		—			(68,051	)		(68,051	)		—			(68,051	)

Total other comprehensive income (loss)		—		—		143,553			650,489			794,042			117,480			911,522

Total comprehensive income (loss) for the period	W	—		—		(1,030,522	)		650,489			(380,033	)		189,771			(190,262	)

Transaction with owners, recognized directly in equity
Dividends to Non-Controlling shareholders in subsidiaries		—		—		—			—			—			(56,056	)		(56,056	)
Dividends		—		—		(232,580	)		—			(232,580	)		—			(232,580	)

Total transaction with owners, recognized directly in equity		—		—		(232,580	)		—			(232,580	)		(56,056	)		(288,636	)

Balances at September 30, 2022	W	1,789,079		2,251,113		7,278,419			1,187,631			12,506,242			1,777,361			14,283,603

Balances at January 1, 2023	W	1,789,079		2,251,113		5,359,769			479,628			9,879,589			1,439,638			11,319,227

Total comprehensive income (loss) for the period
Profit (loss) for the period		—		—		(2,791,928	)		—			(2,791,928	)		164,660			(2,627,268	)
Other comprehensive income (loss)
Remeasurements of net defined benefit liabilities, net of tax		—		—		(737	)		—			(737	)		—			(737	)
Foreign currency translation differences		—		—		—			220,718			220,718			13,392			234,110
Other comprehensive income (loss) from associates		—		—		180			(1,222	)		(1,042	)		—			(1,042	)

Total other comprehensive income (loss)		—		—		(557	)		219,496			218,939			13,392			232,331

Total comprehensive income (loss) for the period	W	—		—		(2,792,485	)		219,496			(2,572,989	)		178,052			(2,394,937	)

Transaction with owners, recognized directly in equity
Dividends to Non-Controlling shareholders in subsidiaries		—		—		—			—			—			(34,098	)		(34,098	)

Balances at September 30, 2023	W	1,789,079		2,251,113		2,567,284			699,124			7,306,600			1,583,592			8,890,192

See accompanying notes to the condensed consolidated interim financial statements.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Interim Statements of Cash Flows

(Unaudited)

For the nine-month periods ended September 30, 2023 and 2022


(In millions of won)	Note		2023			2022
Cash flows from operating activities:
Loss for the period			W	(2,627,268	)		(1,101,784	)
Adjustments for:
Income tax benefit		24		(731,162	)		(471,678	)
Depreciation and amortization		19		3,073,707			3,473,042
Gain on foreign currency translation				(197,565	)		(678,792	)
Loss on foreign currency translation				319,404			1,146,632
Expenses related to defined benefit plans		13		112,460			131,066
Gain on disposal of property, plant and equipment				(28,746	)		(12,936	)
Loss on disposal of property, plant and equipment				77,428			36,289
Impairment loss on property, plant and equipment				58,293			7,200
Reversal of impairment loss on property, plant and equipment				(7	)		(3,181	)
Gain on disposal of intangible assets				(1,989	)		—
Loss on disposal of intangible assets				55			163
Impairment loss on intangible assets				50,900			19,388
Reversal of impairment loss on intangible assets				(242	)		(5,571	)
Expense on increase of provisions				72,277			180,011
Finance income				(538,194	)		(911,117	)
Finance costs				924,409			1,042,489
Equity in (income) of equity method accounted investees, net				(1,269	)		(3,375	)
Other income				(6,996	)		(133,652	)

				3,182,763			3,815,978
Changes in:
Trade accounts and notes receivable				182,104			2,415,179
Other accounts receivable				76,755			7,399
Inventories				(449,605	)		(1,051,007	)
Lease receivables				5,302			4,602
Other current assets				13,164			249,092
Other non-current assets				(2,946	)		(32,083	)
Trade accounts and notes payable				446,224			(609,055	)
Other accounts payable				(157,115	)		(636,197	)
Accrued expenses				3,201			(484,477	)
Provisions				(139,738	)		(187,341	)
Advances received				(24,103	)		(1,215	)
Other current liabilities				(22,450	)		3,872
Defined benefit liabilities, net				(32,450	)		(11,631	)
Long-term advances received				1,580,222			—
Other non-current liabilities				28,674			(22,313	)

				1,507,239			(355,175	)
Cash generated from operating activities				2,062,734			2,359,019
Income taxes paid				(271,508	)		(162,228	)
Interests received				112,483			63,146
Interests paid				(728,003	)		(335,322	)

Net cash provided by operating activities			W	1,175,706			1,924,615

See accompanying notes to the condensed consolidated interim financial statements.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Condensed Consolidated Interim Statements of Cash Flows, Continued

(Unaudited)

For the nine-month periods ended September 30, 2023 and 2022


(In millions of won)	Note	2023			2022
Cash flows from investing activities:
Dividends received		W	15,200			4,461
Increase in deposits in banks			(942,266	)		(1,659,164	)
Proceeds from withdrawal of deposits in banks			1,625,197			755,567
Acquisition of financial asset at fair value through profit or loss			(3,805	)		(27,100	)
Proceeds from disposal of financial asset at fair value through profit or loss			546			412
Acquisition of financial assets at fair value through other comprehensive income			(1,000	)		(1,721	)
Proceeds from disposal of financial assets at fair value through other comprehensive income			891			1,628
Proceeds from disposal of investments in equity accounted investees			—			4,800
Acquisition of property, plant and equipment			(2,765,349	)		(3,845,133	)
Proceeds from disposal of property, plant and equipment			368,497			63,279
Acquisition of intangible assets			(499,101	)		(560,903	)
Proceeds from disposal of intangible assets			5,933			10,446
Government grants received			6,381			57,503
Receipt from settlement of derivatives			127,833			19,378
Increase in short-term loans			—			(9,643	)
Proceeds from collection of short-term loans			23,402			6,156
Increase in long-term loans			—			(49,756	)
Increase in deposits			(3,432	)		(2,260	)
Decrease in deposits			3,884			6,798
Proceeds from disposal of other assets			6,659			1,464

Net cash used in investing activities			(2,030,530	)		(5,223,788	)

Cash flows from financing activities:	27
Proceeds from short-term borrowings			5,190,003			2,821,076
Repayments of short-term borrowings			(5,250,763	)		(1,166,765	)
Proceeds from issuance of bonds			469,266			443,230
Proceeds from long-term borrowings			4,170,987			3,283,880
Repayment of current portion of long-term borrowings and bonds			(2,477,672	)		(3,913,540	)
Payment of lease liabilities			(56,659	)		(61,214	)
Dividends paid			—			(232,580	)
Subsidiaries’ dividends distributed to non-controlling interests			(34,098	)		(22,835	)

Net cash provided by financing activities			2,011,064			1,151,252

Net increase (decrease) in cash and cash equivalents			1,156,240			(2,147,921	)
Cash and cash equivalents at January 1			1,824,649			3,541,597
Effect of exchange rate fluctuations on cash and cash equivalents			25,321			147,173

Cash and cash equivalents at September 30		W	3,006,210			1,540,849

See accompanying notes to the condensed consolidated interim financial statements.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

1.	Reporting Entity

(a)

Description of the Controlling Company

LG Display Co., Ltd. (the “Controlling Company”) was incorporated in February 1985 and the Controlling Company is a public corporation listed in the Korea Exchange since 2004. The main business of the Controlling Company and its subsidiaries (the “Group”) is to manufacture and sell displays and its related products. As of September 30, 2023, the Group is operating Thin Film Transistor Liquid Crystal Display (“TFT-LCD”) and Organic Light Emitting Diode (“OLED”) panel manufacturing plants in Gumi, Paju and China and TFT-LCD and OLED module manufacturing plants in Gumi, Paju, China and Vietnam. The Controlling Company is domiciled in the Republic of Korea with its address at 128 Yeouidae-ro, Yeongdeungpo-gu, Seoul, the Republic of Korea. As of September 30, 2023, LG Electronics Inc., a major shareholder of the Controlling Company, owns 37.9% (135,625,000 shares) of the Controlling Company’s common stock.

The Controlling Company’s common stock is listed on the Korea Exchange under the identifying code 034220. As of September 30, 2023, there are 357,815,700 shares of common stock outstanding. The Controlling Company’s common stock is also listed on the New York Stock Exchange in the form of American Depository Shares (“ADSs”) under the symbol “LPL”. One ADS represents one-half of one share of common stock. As of September 30, 2023, there are 18,642,878 ADSs outstanding.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

1.	Reporting Entity, Continued

(b)

Consolidated Subsidiaries as of September 30, 2023

(In millions)

Subsidiaries

Location

Percentage of
ownership

Fiscal year
end

Date of incorporation

Business

Capital stocks

LG Display America, Inc.

San Jose, U.S.A.

100

December 31

September 24, 1999

Sell display products

USD 411

LG Display Germany GmbH

Eschborn, Germany

100

December 31

October 15, 1999

Sell display products

EUR 1

LG Display Japan Co., Ltd.

Tokyo, Japan

100

December 31

October 12, 1999

Sell display products

JPY 95

LG Display Taiwan Co., Ltd.

Taipei, Taiwan

100

December 31

April 12, 1999

Sell display products

TWD 116

LG Display Nanjing Co., Ltd.

Nanjing, China

100

December 31

July 15, 2002

Manufacture display products

CNY 3,020

LG Display Shanghai Co., Ltd.

Shanghai, China

100

December 31

January 16, 2003

Sell display products

CNY 4

LG Display Guangzhou Co., Ltd.

Guangzhou, China

100

December 31

June 30, 2006

Manufacture display products

CNY 1,655

LG Display Shenzhen Co., Ltd.

Shenzhen, China

100

December 31

July 27, 2007

Sell display products

CNY 4

LG Display Singapore Pte. Ltd.

Singapore

100

December 31

November 4, 2008

Sell display products

USD 1

L&T Display Technology (Fujian) Limited

Fujian, China

December 31

December 7, 2009

Manufacture and sell LCD
module and LCD monitor sets

CNY 116

LG Display Yantai Co., Ltd.

Yantai, China

100

December 31

March 17, 2010

Manufacture display products

CNY 1,008

Nanumnuri Co., Ltd.

Gumi, South Korea

100

December 31

March 21, 2012

Provide janitorial services

KRW 800

LG Display (China) Co., Ltd.

Guangzhou, China

December 31

December 10, 2012

Manufacture and sell display
products

CNY 8,232

Unified Innovative Technology, LLC

Wilmington, U.S.A.

100

December 31

March 12, 2014

Manage intellectual property

USD 9

LG Display Guangzhou Trading Co., Ltd.

Guangzhou, China

100

December 31

April 28, 2015

Sell display products

CNY 1

Global OLED Technology, LLC

Sterling, U.S.A.

100

December 31

December 18, 2009

Manage OLED intellectual
property

USD 138

LG Display Vietnam Haiphong Co., Ltd.

Haiphong, Vietnam

100

December 31

May 5, 2016

Manufacture and sell display
products

USD 600

Suzhou Lehui Display Co., Ltd.

Suzhou, China

100

December 31

July 1, 2016

Manufacture and sell LCD
module and LCD monitor sets

CNY 637

LG DISPLAY FUND I LLC(*)

Wilmington, U.S.A.

100

December 31

May 1, 2018

Invest in venture business and
acquire technologies

USD 75

LG Display High-Tech (China) Co., Ltd.

Guangzhou, China

December 31

July 11, 2018

Manufacture and sell display
products

CNY 15,600

(*)

For the nine-month period ended September 30, 2023, the Controlling Company contributed W4,691 million in cash for the capital increase of LG DISPLAY FUND I LLC. There was no change in the Controlling Company’s percentage of ownership in LG DISPLAY FUND I LLC as a result of this additional investment.

In addition to the above subsidiaries, the Controlling Company has invested W219,300 million in MMT (Money Market Trust), which is controlled by the Controlling Company.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

2.	Basis of Presenting Financial Statements

(a)

Statement of Compliance

The condensed consolidated interim financial statements have been prepared in accordance with Korean International Financial Reporting Standard (“K-IFRS”) No.1034, Interim Financial Reporting. They do not include all of the information required for full annual consolidated financial statements and should be read in conjunction with the consolidated financial statements of the Group as of and for the year ended December 31, 2022.

(b)

Basis of Measurement

The condensed consolidated interim financial statements have been prepared on the historical cost basis except for the following material items in the consolidated statement of financial position:

•

derivative financial instruments at fair value, financial assets at fair value through profit or loss (“FVTPL”), financial assets at fair value through other comprehensive income (“FVOCI”), financial liabilities at fair value through profit or loss (“FVTPL”), and

•

net defined benefit liabilities (defined benefit assets) recognized at the present value of defined benefit obligations less the fair value of plan assets.

(c)

Functional and Presentation Currency

Each subsidiary’s financial statements within the Group are presented in the subsidiary’s functional currency, which is the currency of the primary economic environment in which each subsidiary operates. The condensed consolidated interim financial statements are presented in Korean won, which is the Controlling Company’s functional currency.

(d)

Use of Estimates and Judgments

The preparation of the condensed consolidated interim financial statements in conformity with K-IFRSs requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

3.	Accounting Policies

The accounting policies followed by the Group in the preparation of its condensed consolidated interim financial statements are the same as those followed by the Group in its preparation of the consolidated financial statements as of and for the year ended December 31, 2022, except for the application of K-IFRS No. 1034, Interim Financial Reporting.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

4.	Cash and Cash Equivalents and Deposits in Banks

Cash and cash equivalents and deposits in banks as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Current assets
Cash and cash equivalents
Cash	W	3		1,076
Deposits		3,006,207		1,823,573

	W	3,006,210		1,824,649

Deposits in banks
Time deposits	W	292,293		267,163
Restricted deposits (*)		788,813		1,455,444

	W	1,081,106		1,722,607

Non-current assets
Deposits in banks
Restricted deposits (*)	W	11		11

(*)	Includes funds deposited under agreements on mutually beneficial cooperation to aid LG Group companies’ suppliers, restricted deposits pledged to guarantee the Controlling Company and subsidiary’s borrowings and others.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

5.	Trade Accounts and Notes Receivable, Other Accounts Receivable and Others

(a)

Trade accounts and notes receivable as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Due from third parties	W	1,942,517		2,042,746
Due from related parties		408,533		316,168

	W	2,351,050		2,358,914

(b)

Other accounts receivable as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Current assets
Non-trade receivables, net	W	69,849		146,921
Accrued income		13,417		22,505

	W	83,266		169,426

Due from related parties included in other accounts receivable as of September 30, 2023 and December 31, 2022 are W2,716 million and W12,957 million, respectively.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

5.	Trade Accounts and Notes Receivable, Other Accounts Receivable and Others, Continued

(c)

The aging of trade accounts and notes receivable and other accounts receivable as of September 30, 2023 and December 31, 2022 are as follows:



	September 30, 2023
	Book value				Allowance for impairment
(In millions of won)	Trade accounts and notes receivable		Other accounts receivable		Trade accounts and notes receivable			Other accounts receivable
Current	W	2,338,402		80,910		(890	)		(1,535	)
1-15 days past due		6,931		1,658		(2	)		(16	)
16-30 days past due		4,302		412		—			(1	)
31-60 days past due		—		504		—			(5	)
More than 60 days past due		2,328		1,348		(21	)		(9	)

	W	2,351,963		84,832		(913	)		(1,566	)



	December 31, 2022
	Book value				Allowance for impairment
(In millions of won)	Trade accounts and notes receivable		Other accounts receivable		Trade accounts and notes receivable			Other accounts receivable
Current	W	2,332,769		166,067		(841	)		(1,721	)
1-15 days past due		12,019		1,000		(4	)		(9	)
16-30 days past due		2,256		—		(1	)		—
31-60 days past due		391		201		—			(1	)
More than 60 days past due		12,354		3,936		(29	)		(47	)

	W	2,359,789		171,204		(875	)		(1,778	)

The movement in the allowance for impairment in respect of trade accounts and notes receivable and other accounts receivable for the nine-month periods ended September 30, 2023 and 2022 are as follows:


	2023					2022
(In millions of won)	Trade accounts and notes receivable		Other accounts receivable			Trade accounts and notes receivable			Other accounts receivable
Balance at the beginning of the period	W	875		1,778			1,204			2,005
(Reversal of) bad debt expense		38		(212	)		(578	)		(153	)

Balance at the end of the reporting period	W	913		1,566			626			1,852

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

5.	Trade Accounts and Notes Receivable, Other Accounts Receivable and Others, Continued

(d)

Other current assets as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Advanced payments	W	2,165		22,134
Prepaid expenses		151,342		74,420
Value added tax refundable		177,202		220,182
Right to recover returned goods		5,091		8,155

	W	335,800		324,891

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

6.	Other Financial Assets

Other financial assets as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Current assets
Financial assets at fair value through profit or loss
Derivatives(*1)	W	227,197		119,417
Fair value hedging derivatives
Derivatives(*2)	W	10,332		—
Financial assets carried at amortized cost
Deposits	W	1,921		8,962
Short-term loans		24,208		30,062
Lease receivables		5,986		6,914

	W	32,115		45,938

	W	269,644		165,355

Non-current assets
Financial assets at fair value through profit or loss
Equity instruments	W	92,867		96,064
Convertible securities		3,142		1,797
Derivatives(*1)		67,635		110,663

	W	163,644		208,524

Fair value hedging derivatives
Derivatives(*2)	W	9,682		—
Financial assets carried at amortized cost
Deposits	W	17,245		17,624
Long-term loans		41,691		58,806
Lease receivables		—		4,144

	W	58,936		80,574

	W	232,262		289,098

(*1)	Represents cross currency interest rate swap contracts and others entered into by the Group to hedge currency and interest rate risks with respect to foreign currency denominated borrowings and bonds. The contracts are not designated as hedging instruments.

(*2)	Represents forward exchange contracts entered into by the Group to hedge exchange rate risks with respect to advances received in foreign currency. The contracts are designated as hedging instruments.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

7.	Inventories

Inventories as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Finished goods	W	1,086,823		822,177
Work-in-process		1,444,301		1,235,363
Raw materials		634,945		651,602
Supplies		182,473		163,776

	W	3,348,542		2,872,918

For the nine-month periods ended September 30, 2023 and 2022, the amount of inventories recognized as cost of sales and inventory write-downs included in cost of sales are as follows:


(In millions of won)	2023		2022
Inventories recognized as cost of sales	W	14,453,640		17,706,000
Including: inventory write-downs		256,765		291,284

There were no significant reversals of inventory write-downs recognized during the nine-month periods ended September 30, 2023 and 2022.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

8.	Investments in Equity-Accounted Investees

Associates as of September 30, 2023 and December 31, 2022 are as follows:

(In millions of won)

Associates

Location

Fiscal year
end

Date of
incorporation

Business

September 30, 2023

December 31, 2022

Percentage
of ownership

Carrying
amount

Percentage
of ownership

Carrying
amount

Paju Electric Glass Co., Ltd.

Paju,

South Korea

December 31

January

2005

Manufacture glass for display

40%

29,034

40%

42,784

WooRee E&L Co., Ltd.

Ansan,

South Korea

December 31

June

2008

Manufacture LED back light unit packages

13%

12,336

13%

13,576

YAS Co., Ltd.

Paju,

South Korea

December 31

April

2002

Develop and manufacture deposition equipment for OLEDs

15%

28,358

15%

28,976

AVATEC Co., Ltd.

Daegu,

South Korea

December 31

August

2000

Process and sell glass for display

14%

21,385

14%

20,133

Arctic Sentinel, Inc.

Los Angeles, U.S.A.

March 31

June

2008

Develop and manufacture

tablet for kids

10%

—

10%

—

Cynora GmbH

Bruchsal,

Germany

December 31

March

2003

Develop organic emitting materials for displays and lighting devices

10%

—

11%

—

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

8.	Investments in Equity Accounted Investees, Continued

(In millions of won)

Associates

Location

Fiscal year
end

Date of
incorporation

Business

September 30, 2023

December 31, 2022

Percentage
of ownership

Carrying
Amount

Percentage
of ownership

Carrying
amount

Material Science Co., Ltd.

Seoul,

South Korea

December 31

January

2014

Develop, manufacture,

and sell materials for
display

2,972

3,650

94,085

109,119

Although the Controlling Company’s respective share interests in WooRee E&L Co., Ltd., YAS Co., Ltd., AVATEC Co., Ltd., Arctic Sentinel, Inc., Cynora GmbH and Material Science Co., Ltd. are below 20%, the Controlling Company is able to exercise significant influence through its right to appoint a director to the board of directors of each investee. Accordingly, the investments in these investees have been accounted for using the equity method.

Dividends income recognized from equity method investees for the nine-month periods ended September 30, 2023 and 2022 amounted to W15,200 million and W4,461 million, respectively.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

9.	Property, Plant and Equipment

For the nine-month periods ended September 30, 2023 and 2022, the Group purchased property, plant and equipment of W2,892,799 million and W4,528,160 million, respectively. The capitalized borrowing costs and the annualized capitalization rate were W 216,481 million and 5.11%, and W101,991 million and 3.00% for the nine-month periods ended September 30, 2023 and 2022, respectively. Also, for the nine-month periods ended September 30, 2023 and 2022, the Group disposed of property, plant and equipment with carrying amounts of W417,315 million and W99,414 million, respectively, and recognized W28,746 million and W77,428 million, respectively, as gain and loss on disposal of property, plant and equipment for the nine-month period ended September 30, 2023 (gain and loss on disposal of property, plant and equipment for the nine-month period ended September 30, 2022: W12,936 million and W36,289 million, respectively).

10.	Intangible Assets

The Group capitalizes expenditures related to development activities, such as expenditures incurred on designing, manufacturing and testing of products after those related activities meet the capitalization criteria of development costs including technical feasibility, future economic benefits and others. The balances of capitalized development costs as of September 30, 2023 and December 31, 2022 are W634,837 million and W565,219 million, respectively. For the nine-month periods ended September 30, 2023 and 2022, the Group recognized an impairment loss amounting to W49,108 million and W11,273 million, respectively, in connection with development projects.

11.	Investment Property

(a)

Changes in investment property for the nine-month period ended September 30, 2023 are as follows:


(In millions of won)	2023
Book value as of January 1, 2023	W	28,269
Transfer from Property, Plant and Equipment		9,928
Depreciation		(3,690	)
Others		(228	)

Book value as of September 30, 2023	W	34,279

(b)

During the nine-month period ended September 30, 2023, rental income from investment property is W3,704 million.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

12.	Financial Liabilities

(a)

Financial liabilities as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Current
Short-term borrowings	W	2,576,040		2,578,552
Current portion of long-term borrowings and bonds		2,826,930		2,855,565
Derivatives (*1)		6,142		14,443
Lease liabilities		43,446		40,694

	W	5,452,558		5,489,254

Non-current
Won denominated borrowings	W	3,844,063		1,644,602
Foreign currency denominated borrowings		7,116,735		6,780,593
Bonds		1,123,612		1,132,098
Derivatives (*1)		11,525		32,965
Fair value hedging derivatives (*2)		2,609		—
Lease liabilities		25,550		32,094

	W	12,124,094		9,622,352

(*1)	Represents cross currency interest rate swap contracts and others entered into by the Group to hedge currency and interest rate risks with respect to foreign currency denominated borrowings and bonds. The contracts are not designated as hedging instruments.

(*2)	Represents forward exchange contracts entered into by the Group to hedge exchange rate risks with respect to advances received in foreign currency. The contracts are designated as hedging instruments

(b)

Short-term borrowings as of September 30, 2023 and December 31, 2022 are as follows:

(In millions of won, USD and CNY)

Lender

Annual interest rate
as of
September 30, 2023 (%)

September 30,
2023

December 31,
2022

Standard Chartered Bank Korea Limited and others

3.50 ~ 6.95

2,576,040

2,578,552

Foreign currency equivalent

USD

788

USD

1,252

CNY

345

CNY

1,000

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

12.	Financial Liabilities, Continued

(c)

Won denominated long-term borrowings as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won) Lender	Annual interest rate as of September 30, 2023 (%)	September 30, 2023			December 31, 2022
LG Electronics Inc.	6.06	W	1,000,000			—
Korea Development Bank and others	1.90 ~ 7.50		3,316,938			2,986,102
Less current portion of long-term borrowings			(472,875	)		(1,341,500	)

		W	3,844,063			1,644,602

(d)

Foreign currency denominated long-term borrowings as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won, USD and CNY) Lender	Annual interest rate as of September 30, 2023 (%)		September 30, 2023			December 31, 2022
KEB Hana Bank and others		1.82 ~ 8.50	W	9,101,189			7,978,010
Foreign currency equivalent			USD	3,377		USD	3,494
			CNY	24,749		CNY	19,569
Less current portion of long-term borrowings				(1,984,454	)		(1,197,417	)

			W	7,116,735			6,780,593

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

12.	Financial Liabilities, Continued

(e)

Details of bonds issued and outstanding as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won and USD)	Maturity	Annual interest rate as of September 30, 2023 (%)	September 30, 2023			December 31, 2022
*Won denominated bonds at amortized cost (1)**
Publicly issued bonds	February 2024 ~ February 2027	2.29 ~ 3.66	W	1,025,000			1,215,000
Privately issued bonds	January 2025 ~ January 2026	7.20 ~ 7.25		337,000			110,000
Less discount on bonds				(2,493	)		(2,927	)
Less current portion				(369,601	)		(189,975	)

			W	989,906			1,132,098

*Foreign currency denominated bonds at amortized cost (2)**
Privately issued bonds	April 2026	7.27	W	134,480			126,730
Foreign currency equivalent (contractual par amount)			USD	100		USD	100
Less discount on bonds				(774	)		(57	)
Foreign currency equivalent (less discount on bonds)			USD	(1	)	USD	(0	)
Less current portion				—			(126,673	)

			W	133,706			—

			W	1,123,612			1,132,098

(*1)	Principal of the won denominated bonds is to be repaid at maturity and interests are paid quarterly.

(*2)	Principal of the foreign currency denominated bonds is to be repaid at maturity and interests are paid quarterly.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

13.	Employee Benefits

The Controlling Company and certain subsidiaries’ defined benefit plans provide a lump-sum payment to an employee based on final salary rates and length of service at the time the employee leaves the Controlling Company or certain subsidiaries.

(a)

Net defined benefit liabilities (defined benefit assets) recognized as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023			December 31, 2022
Present value of partially funded defined benefit obligations	W	1,565,273			1,602,697
Fair value of plan assets		(1,930,385	)		(2,048,687	)

	W	(365,112	)		(445,990	)

Defined benefit liabilities, net	W	1,385			1,531
Defined benefit assets, net	W	366,497			447,521

(b)

Expenses related to defined benefit plans recognized in profit or loss for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30						For the nine-month periods ended September 30
(In millions of won)	2023			2022			2023			2022
Current service cost	W	43,464			43,452			130,417			133,446
Net interest cost		(5,985	)		(1,318	)		(17,957	)		(2,380	)

	W	37,479			42,134			112,460			131,066

(c)

Plan assets as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Guaranteed deposits in banks	W	1,930,385		2,048,687

As of September 30, 2023, the Controlling Company maintains the plan assets primarily with Mirae Asset Securities Co., Ltd., KB Insurance Co., Ltd. and others.

(d)

Remeasurements of the net defined benefit liabilities (assets) included in other comprehensive income (loss) for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


(In millions of won)	For the three-month periods ended September 30						For the nine-month periods ended September 30
(In millions of won)	2023			2022			2023			2022
Remeasurements of net defined benefit liabilities	W	60			(6,718	)		(952	)		194,367
Tax effect		(14	)		1,758			215			(50,846	)

Remeasurements of net defined benefit liabilities, net of income tax	W	46			(4,960	)		(737	)		143,521

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

14.	Provisions

Changes in provisions for the nine-month periods ended September 30, 2023 and 2022 are as follows:


(In millions of won)	Litigation and claims		*Warranties ()**			Others			Total
Balance at January 1, 2023	W	1,680		249,368			8,431			259,479
Additions (reversal)		118		72,277			(3,122	)		69,273
Usage		—		(136,617	)		—			(136,617	)

Balance at September 30, 2023	W	1,798		185,028			5,309			192,135

Current	W	1,798		119,517			5,309			126,624
Non-current	W	—		65,511			—			65,511


(In millions of won)	Litigation and claims		*Warranties ()**			Others			Total
Balance at January 1, 2022	W	—		257,126			9,247			266,373
Additions (reversal)		1,758		178,252			(737	)		179,273
Usage		—		(186,604	)		—			(186,604	)

Balance at September 30, 2022	W	1,758		248,774			8,510			259,042

Current	W	1,758		161,591			8,510			171,859
Non-current	W	—		87,183			—			87,183

(*)	Product warranties on defective products are normally applicable for warranty periods from the date of customer’s purchase. The provision is calculated by using historical and anticipated rates of warranty claims and costs per claim to satisfy the Group’s warranty obligation.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

15.	Contingent Liabilities and Commitments

(a)

Legal Proceedings

Anti-trust litigations

Certain individual plaintiffs have filed “follow-on” damage claims against the Group and other TFT-LCD manufacturers alleging violations of EU competition law. While the Group continues to vigorously defend the various pending actions described above, as of September 30, 2023, the Group is unable to reliably estimate the timing and amount of outflows of resources embodying economic benefits relating to these actions.

Others

In addition to matters described above, the Group is involved various legal proceedings and litigation. The Group cannot reliably estimate the timing and amount of outflows of resources embodying economic benefits related to these matters.

(b)

Commitments

Factoring and securitization of accounts receivable

The Controlling Company has agreements with Korea Development Bank and several other banks for accounts receivable sales negotiating facilities of up to an aggregate of USD 1,000 million (W1,344,800 million) in connection with the Controlling Company’s export sales transactions with its subsidiaries. As of September 30, 2023, there are no short-term borrowings that are outstanding but past due in connection with these agreements. In connection with all of the contracts in this paragraph, the Controlling Company has sold its accounts receivable with recourse.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

15.	Contingent Liabilities and Commitments, Continued

The Controlling Company and overseas subsidiaries have agreements with financial institutions for accounts receivables sales negotiating facilities. As of September 30, 2023, the respective maximum amounts of accounts receivables that could be sold under the agreement and the amount of sold but not yet due accounts receivables by contract are as follows:


		Credit limit				Not yet due
(In millions of USD and KRW) Classification	Financial institutions	Contractual amount		KRW equivalent		Contractual amount		KRW equivalent
Controlling Company	Sumitomo Mitsui Banking Corporation	USD	20	W	26,896		—	W	—
	MUFG Bank	USD	180		242,064	USD	21		28,318
	BNP Paribas	USD	15		20,172		—		—
	ING Bank	USD	40		53,792	USD	8		10,492

		USD	255		342,924	USD	29		38,810

Subsidiaries
LG Display Singapore Pte. Ltd.	Standard Chartered Bank	USD	100		134,480	USD	20		26,737
	United Overseas Bank Limited	USD	150		201,720	USD	33		45,039
	JPMorgan Chase Bank, N.A., Singapore Branch	USD	50		67,240		—		—
	Credit Agricole Corporate & Investment Bank, Singapore Branch	USD	300		403,440		—		—
	ING Bank	USD	50		67,240	USD	26		35,629

LG Display Taiwan Co., Ltd.	BNP Paribas	USD	15		20,172	USD	10		13,448
	Australia and New Zealand Banking Group Ltd.	USD	120		161,376	USD	26		34,966

LG Display Germany GmbH	BNP Paribas	USD	135		181,548	USD	35		47,290

LG Display America, Inc.	Hong Kong & Shanghai Banking Corp.	USD	400		537,920	USD	150		201,721
	Standard Chartered Bank	USD	1,000		1,344,800	USD	572		769,352
	ING Bank	USD	150		201,720	USD	47		62,769

LG Display Japan Co., Ltd.	Standard Chartered Bank	USD	200		268,960	USD	30		40,349
	Chelsea Capital Corporation	USD	20		26,896		—		—

LG Display Guangzhou Trading Co., Ltd.	KEB Hana Bank (China) Company Limited	USD	30		40,344	USD	16		21,953

		USD	2,720		3,657,856	USD	965		1,299,253

		USD	2,975		4,000,780	USD	994		1,338,063

In connection with all of the contracts in the above table, the Group has sold its accounts receivable without recourse.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

15.	Contingent Liabilities and Commitments, Continued

Letters of credit

As of September 30, 2023, the Group entered into agreements with financial institutions in relation to the opening of letters of credit and the respective credit limits under the agreements are as follows:


(In millions of won and USD )	Contractual amount		KRW equivalent
KEB Hana Bank	USD	650	W	874,120
Industrial Bank of Korea	USD	450		605,160
Industrial and Commercial Bank of China	USD	200		268,960
Shinhan Bank	USD	150		201,720
KB Kookmin Bank	USD	700		941,360
MUFG Bank	USD	100		134,480
The Export–Import Bank of Korea	USD	100		134,480

	USD	2,350		3,160,280

Payment guarantees

The Controlling Company obtained payment guarantees amounting to USD 1,200 million (W1,613,760 million) from KB Kookmin Bank and others for advances received related to the long-term supply agreements.

LG Display (China) Co., Ltd. and other subsidiaries are provided with payment guarantees from the China Construction Bank Corporation and other various banks amounting to CNY 910 million (W167,686 million), JPY 900 million (W8,120 million), VND 72,379 million (W3,988 million), and USD 0.5 million (W694 million), respectively, for their local tax payments and utility payments.

License agreements

As of September 30, 2023, the Group has technical license agreements with Hitachi Display, Ltd. and others in relation to its LCD business and patent license agreement with Universal Display Corporation and others in relation to its OLED business. Also, the Group has a trademark license agreement with LG Corp. and other intellectual property license agreements with various companies as of September 30, 2023.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

15.	Contingent Liabilities and Commitments, Continued

Long-term Supply Agreement

As of September 30, 2023, in connection with long-term supply agreements with customers, the Controlling Company recognized USD 1,200 million (W1,613,760 million) in advances received. The advances received will be used to offset accounts receivable arising from future product sales after a specified period of time. The Controlling Company received payment guarantees amounting to USD 1,200 million (W1,613,760 million) from KB Kookmin Bank and other various banks relating to advances received (see note 15(b)).

Pledged Assets

In connection with the borrowings amounting to CNY 11,160 million (W2,056,453 million) from China Construction Bank Corporation and others, as of September 30, 2023, the Group has provided its property, plant and equipment with carrying amount of W732,914 million as pledged assets.

In connection with the borrowings amounting to USD 400 million (W537,920 million) and W450,000 million from Shinhan Bank and others, as of September 30, 2023, the Group has provided its Deposit in bank to with carrying amount of CNY 5,776 million (W1,064,253 million) as pledged assets.

In addition, in connection with the borrowings amounting to W1,000,000 million from related party, as of September 30, 2023, the Controlling Company has provided its property, plant and equipment with carrying amount of W524,643 million as pledged assets (see note 12(c)).

In connection with the borrowing amounting to W272,000 million from Korea Development Bank and others as of September 30, 2023, the Group has provided its property, plant and equipment with carrying amount of W97,053 million as pledged assets.

Commitments for asset acquisition

The Group’s commitments in relation to capital expenditures on property, plant and equipment and intangible assets as of September 30, 2023 are W887,785 million.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

16.	Share Capital, Share Premium and Reserves

(a)

Share capital and Share premium

The Controlling Company is authorized to issue 500,000,000 shares of capital stock (par value W5,000) and, as of September 30, 2023 and December 31, 2022, the number of issued common shares is 357,815,700. There have been no changes in the capital stock from January 1, 2022 to September 30, 2023.

The Group’s capital surplus consists of share premium. There have been no changes in share premium from January 1, 2022 to September 30, 2023.

(b)

Reserves

Reserves consist mainly of the following:

Translation reserve

The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.

Other comprehensive income (loss) from associates

The other comprehensive income (loss) from associates comprises the amount related to change in equity of investments in equity accounted investees.

Reserves as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023			December 31, 2022
Foreign currency translation differences for foreign operations	W	730,338			509,620
Other comprehensive loss from associates		(31,214	)		(29,992	)

	W	699,124			479,628

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

17.

Revenue

Details of revenue for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30					For the nine-month periods ended September 30
(In millions of won)	2023		2022			2023		2022
Sales of goods	W	4,759,962		6,841,542			13,880,497		18,967,555
Royalties		3,388		2,846			12,743		9,584
Others		21,937		10,338			41,674		25,670
Hedging loss		—		(83,371	)		—		(152,656	)

	W	4,785,287		6,771,355			13,934,914		18,850,153

18.	Geographic and Other Information

The following is a summary of the Group’s operation by region based on the location of customers for the three-month and nine-month periods ended September 30, 2023 and 2022.

(a)

Revenue by geography


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Domestic	W	156,143		148,916		452,441		519,806
Foreign
China		3,196,439		4,541,702		9,097,005		12,262,462
Asia (excluding China)		551,101		769,424		1,782,865		2,169,121
United States		558,485		834,746		1,554,495		2,375,427
Europe (excluding Poland)		145,057		237,834		453,365		776,752
Poland		178,062		322,104		594,743		899,241

	W	4,629,144		6,705,810		13,482,473		18,483,003

	W	4,785,287		6,854,726		13,934,914		19,002,809

During the three-month and nine-month periods ended September 30, 2022, total revenue excludes amounting to W83,371 million and W152,656 million, respectively, forward exchange hedging loss which was reclassified from accumulated other comprehensive loss to revenue when the sales from the hedged forecast transactions are recognized.

Sales to Company A and Company B amount to W6,587,044 million and W2,451,390 million, respectively, for the nine-month period ended September 30, 2023 (the nine-month period ended September 30, 2022: W7,673,206 million and W3,431,692 million, respectively). The Group’s top ten end-brand customers together accounted for 86% of sales for the nine-month period ended September 30, 2023 (the nine-month period ended September 30, 2022: 85%).

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

18.	Geographic and Other Information, Continued

(b)

Non-current assets by geography


	September 30, 2023				December 31, 2022
(In millions of won)	Property, plant and equipment		Intangible assets		Property, plant and equipment		Intangible assets
Domestic	W	13,928,628		1,638,993		14,042,794		1,633,866
Foreign
China		3,626,575		36,297		4,302,527		53,388
Vietnam		3,387,426		25,179		2,590,438		20,315
Others		10,691		34,859		11,174		45,388

	W	7,024,692		96,335		6,904,139		119,091

	W	20,953,320		1,735,328		20,946,933		1,752,957

(c)

Revenue by product and services


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
TV	W	1,086,004		1,719,169		3,014,923		5,164,962
IT		1,933,117		3,060,066		5,601,724		8,719,159
Mobile and others		1,766,166		2,075,491		5,318,267		5,118,688

	W	4,785,287		6,854,726		13,934,914		19,002,809

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

19.	The Nature of Expenses and Others

The classification of expenses by nature for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30					For the nine-month periods ended September 30
(In millions of won)	2023			2022		2023			2022
Changes in inventories	W	(666,959	)		205,133		(475,624	)		(1,166,942	)
Purchases of raw materials, merchandise and others		2,921,472			3,636,844		7,729,983			10,500,178
Depreciation and amortization		1,044,317			1,150,500		3,073,707			3,473,042
Outsourcing		262,736			317,469		672,963			858,189
Labor		848,774			948,303		2,572,509			2,747,256
Supplies and others		242,496			318,517		678,554			921,718
Utility		312,073			312,325		875,485			878,561
Fees and commissions		161,184			205,903		504,613			617,245
Shipping		30,595			72,129		89,903			227,376
Advertising		17,741			28,617		53,145			84,802
Warranty		19,700			55,624		72,277			178,252
Travel		18,425			19,098		47,770			48,250
Taxes and dues		32,632			34,290		97,105			106,671
Others		269,144			251,546		794,723			652,712

	W	5,514,330			7,556,298		16,787,113			20,127,310

Total expenses consist of cost of sales, selling, administrative, research and development expenses and other non-operating expenses, excluding foreign exchange differences.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

20.	Selling and Administrative Expenses

Details of selling and administrative expenses for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Salaries	W	87,148		92,084		273,171		262,846
Expenses related to defined benefit plans		6,051		5,721		18,615		20,779
Other employee benefits		20,461		23,950		64,549		67,841
Shipping		22,455		55,405		64,730		177,241
Fees and commissions		63,392		68,241		186,892		198,097
Depreciation		65,157		67,142		199,597		199,985
Taxes and dues		17,671		15,539		50,656		49,013
Advertising		17,741		28,617		53,145		84,802
Warranty		19,700		55,624		72,277		178,252
Insurance		3,378		3,909		10,267		11,666
Travel		4,750		5,070		13,845		12,677
Training		2,138		5,228		8,099		13,453
Others		23,235		33,940		68,345		86,345

	W	353,277		460,470		1,084,188		1,362,997

21.	Personnel Expenses

Details of personnel expenses for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Salaries and wages	W	705,432		767,256		2,140,131		2,230,813
Other employee benefits		145,221		172,312		452,687		474,151
Contributions to National Pension plan		21,360		20,250		60,329		56,832
Expenses related to defined benefit plans and defined contribution plans		39,536		42,274		118,112		131,786

	W	911,549		1,002,092		2,771,259		2,893,582

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

22.	Other Non-operating Income and Other Non-operating Expenses

(a)

Details of other non-operating income for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Foreign currency gain	W	222,295		1,123,318		1,026,369		2,218,676
Gain on disposal of property, plant and equipment		4,948		3,476		28,746		12,936
Gain on disposal of intangible assets		1,520		—		1,989		—
Reversal of impairment loss on property, plant and equipment		—		9		7		3,181
Reversal of impairment loss on intangible assets		120		—		242		5,571
Rental income		462		502		1,707		1,720
Others		8,374		15,287		11,993		40,922

	W	237,719		1,142,592		1,071,053		2,283,006

(b)

Details of other non-operating expenses for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Foreign currency loss	W	354,390		1,409,814		1,284,342		2,580,621
Loss on disposal of property, plant and equipment		22,731		11,607		77,428		36,289
Loss on disposal of intangible assets		—		7		55		163
Impairment loss on property, plant and equipment		2,861		—		58,293		7,200
Impairment loss on intangible assets		29,098		12,686		50,900		19,388
Others		12,273		1,337		23,615		4,812

	W	421,353		1,435,451		1,494,633		2,648,473

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

23.	Finance Income and Finance Costs

Finance income and costs recognized in profit or loss for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Finance income
Interest income	W	36,096		19,846		102,651		62,286
Foreign currency gain		56,337		123,355		481,602		238,542
Gain on disposal of investments in equity accounted investees		—		4,480		—		2,993
Gain on transaction of derivatives		42,743		6,098		127,833		19,754
Gain on valuation of derivatives		48,053		383,839		295,896		600,752
Gain on disposal of financial assets at fair value through profit or loss		—		—		48		267
Gain on valuation of financial assets at fair value through profit or loss		—		—		—		310
Gain on valuation of financial liabilities at fair value through profit or loss		—		2,967		—		220,355

	W	183,229		540,585		1,008,030		1,145,259

Finance costs
Interest expense	W	199,340		106,394		508,630		283,954
Foreign currency loss		134,202		465,527		551,793		840,111
Loss on early repayment of borrowings and bonds		—		2,540		167		2,540
Loss on sale of trade accounts and notes receivable		10,167		11,791		24,671		18,463
Loss on transaction of derivatives		—		38		—		376
Loss on valuation of derivatives		—		—		201,401		—
Loss on disposal of financial assets at fair value through profit or loss		—		96		—		96
Loss on valuation of financial assets at fair value through profit or loss		—		97		10,372		1,514
Others		2,471		24		5,207		270

	W	346,180		586,507		1,302,241		1,147,324

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

24.	Income Tax Expense (Benefit)

(a)

Details of income tax expense (benefit) for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30						For the nine-month periods ended September 30
(In millions of won)	2023			2022			2023			2022
Current tax expense (benefit)	W	(5,211	)		58,427			217,224			134,887
Deferred tax benefit		(225,852	)		(383,205	)		(948,386	)		(606,565	)

Income tax benefit	W	(231,063	)		(324,778	)		(731,162	)		(471,678	)

(b)

Deferred tax assets and liabilities

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that the deferred tax assets at the reporting date will be realized with the Group’s estimated future taxable income. The Group’s deferred tax assets and liabilities may differ from actual refundable or payable amount.

Deferred tax assets and liabilities as of September 30, 2023 and December 31, 2022 are attributable to the following:


	Assets				Liabilities						Total
(In millions of won)	September 30, 2023		December 31, 2022		September 30, 2023			December 31, 2022			September 30, 2023			December 31, 2022
Other accounts receivable, net	W	—		—		(41	)		(2,009	)		(41	)		(2,009	)
Inventories, net		67,198		62,014		—			—			67,198			62,014
Defined benefit liabilities, net		—		—		(84,038	)		(95,850	)		(84,038	)		(95,850	)
Investments in subsidiaries and associates		—		—		(162,956	)		(252,375	)		(162,956	)		(252,375	)
Accrued expenses		101,131		111,293		—			—			101,131			111,293
Property, plant and equipment		628,146		704,117		(42,593	)		(17,322	)		585,553			686,795
Intangible assets		9,683		25,340		(2,737	)		(4,042	)		6,946			21,298
Provisions		42,030		57,210		—			—			42,030			57,210
Other temporary differences		87,119		112,771		(23,176	)		(26,519	)		63,943			86,252
Tax losses carryforwards		2,788,867		1,795,132		—			—			2,788,867			1,795,132
Tax credit carryforwards		179,192		170,971		—			—			179,192			170,971

Deferred tax assets (liabilities)	W	3,903,366		3,038,848		(315,541	)		(398,117	)		3,587,825			2,640,731

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Loss Per Share Attributable to Owners of the Controlling Company

(a)

Basic loss per share for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30						For the nine-month periods ended September 30
(In won and number of shares)	2023			2022			2023			2022
Loss attributable to owners of the Controlling Company	W	(720,025,816,567	)		(789,511,242,382	)		(2,791,928,210,926	)		(1,174,074,737,680	)
Weighted-average number of common stocks outstanding		357,815,700			357,815,700			357,815,700			357,815,700

Basic loss per share	W	(2,012	)		(2,206	)		(7,803	)		(3,281	)

For the three-month and nine-month periods ended September 30, 2023 and 2022, there were no events or transactions that resulted in changes in the number of common stocks used for calculating basic loss per share.

(b)

Diluted loss per share

Diluted loss per share is not different from basic loss per share as there is no dilution effect of potential common stocks for the three-month and nine-month period ended September 30, 2023 and for the three-month period ended September 30, 2022.

Diluted loss per share for the nine-month period ended September 30, 2022 is as follows:


(In won and number of shares)	For the nine-month period ended September 30, 2022
Loss attributable to owners of the Controlling Company		(1,174,074,737,680	)
Adjustments:
Interest expenses of convertible bond, net of income tax		8,175,578,596
Gain on valuation of convertible bond, net of income tax		(162,710,366,491	)
Diluted loss attributable to owners of the Controlling Company		(1,328,609,525,575	)
Weighted-average number of common stocks outstanding, after adjustment		394,228,303

Diluted loss per share		(3,370	)

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Loss Per Share Attributable to Owners of the Controlling Company, Continued

Weighted-average number of common stocks outstanding, after adjustment, for measurement of diluted loss per share is determined as follows:


(Number of shares)	For the nine-month period ended September 30, 2022
Weighted-average number of common stocks outstanding		357,815,700
Adjustment: Number of common stocks to be issued from conversion		36,412,603

Weighted-average number of common stocks outstanding, after adjustment		394,228,303

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management

The Group is exposed to credit risk, liquidity risk and market risks. The Group identifies and analyzes such risks, and controls are implemented under a risk management system to monitor and manage these risks at below an acceptable level.

(a)

Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices, will affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

(i)

Currency risk

The Group is exposed to currency risk on sales, purchases and borrowings that are denominated in a currency other than the functional currency of the Controlling Company, Korean won (KRW). The currencies in which these transactions primarily are denominated are USD, CNY, JPY, etc.

Interest on borrowings is accrued in the currency of the borrowing. Generally, borrowings are denominated in currencies that match the cash flows generated by the underlying operations of the Group, primarily KRW, USD and CNY.

The Group adopts policies to ensure that its net exposure is kept to a manageable level by buying or selling foreign currencies at spot rates when necessary to address short-term imbalances. In respect of monetary assets and liabilities denominated in foreign currencies, the Group manages currency risk through continuously managing the position of foreign currencies, measuring the currency risk and, if necessary, using derivatives such as currency forwards, currency swap and others.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

i) Exposure to currency risk

The Group’s exposure to foreign currency risk based on notional amounts as of September 30, 2023 and December 31, 2022 is as follows:


	September 30, 2023
(In millions)	USD			JPY			CNY			TWD			EUR			PLN		VND
Cash and cash equivalents		1,808			547			1,265			38			2			1		213,819
Deposits in banks		—			—			7,362			—			—			—		—
Trade accounts and notes receivable		1,695			—			543			—			—			—		—
Other accounts receivables		11			169			113			18			4			—		13,263
Other assets denominated in foreign currencies		25			187			40			7			—			—		12,168
Trade accounts and notes payable		(1,701	)		(9,085	)		(1,889	)		—			—			—		(436,447	)
Other accounts payable		(647	)		(12,912	)		(2,046	)		(5	)		(4	)		—		(1,000,802	)
Financial liabilities		(4,264	)		—			(25,094	)		—			—			—		—
Advances received		(1,200	)		—			—			—			—			—		—

		(4,273	)		(21,094	)		(19,706	)		58			2			1		(1,197,999	)

Cross currency interest rate swap contracts(*1)		2,065			—			345			—			—			—		—
Forward exchange contracts(*2)		1,200			—			—			—			—			—		—

Net exposure		(1,008	)		(21,094	)		(19,361	)		58			2			1		(1,197,999	)

(*1)

Of cross currency interest rate swap contracts, USD 500 million and CNY 345 million were entered into to hedge currency risk with respect to foreign currency denominated borrowings and USD 1,565 million were entered into to hedge currency risk and interest rate risk with respect to foreign currency denominated borrowings and bonds

(*2)	Represents forward exchange contracts entered into by the Group to hedge exchange rate risks with respect to advances received in foreign currency. The contracts are designated as hedging instruments.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued


	December 31, 2022
(In millions)	USD			JPY			CNY			TWD			EUR			PLN		VND
Cash and cash equivalents		1,040			228			1,984			25			1			1		151,912
Deposits in banks		69			—			8,888			—			—			—		—
Trade accounts and notes receivable		1,725			103			703			—			—			—		—
Other accounts receivables		26			114			253			10			21			—		15,800
Other assets denominated in foreign currencies		30			191			82			7			—			—		11,353
Trade accounts and notes payable		(1,824	)		(4,987	)		(1,306	)		—			—			—		(478,926	)
Other accounts payable		(565	)		(19,084	)		(1,711	)		(8	)		(10	)		—		(2,681,508	)
Financial liabilities		(4,846	)		—			(20,569	)		—			—			—		—

		(4,345	)		(23,435	)		(11,676	)		34			12			1		(2,981,369	)

Cross currency interest rate swap contracts(*)		2,430			—			—			—			—			—		—

Net exposure		(1,915	)		(23,435	)		(11,676	)		34			12			1		(2,981,369	)

(*)

Of cross currency interest rate swap contracts, USD 700 million were entered into to hedge currency risk with respect to foreign currency denominated borrowings and USD 1,730 million were entered into to hedge currency risk and interest rate risk with respect to foreign currency denominated borrowings and bonds.

Average exchange rates applied for the nine-month periods ended September 30, 2023 and 2022 and the exchange rates at September 30, 2023 and December 31, 2022 are as follows:


	Average rate				Reporting date spot rate
(In won)	2023		2022		September 30, 2023		December 31, 2022
USD	W	1,300.93		1,267.30		1,344.80		1,267.30
JPY		9.44		9.92		9.02		9.53
CNY		184.86		191.75		184.27		181.44
TWD		42.08		43.34		41.76		41.27
EUR		1,409.67		1,347.18		1,421.72		1,351.20
PLN		307.80		288.55		308.46		288.70
VND		0.0550		0.0548		0.0551		0.0537

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

ii) Sensitivity analysis

A weaker won, as indicated below, against the following currencies which comprise the Group’s assets or liabilities denominated in a foreign currency as of September 30, 2023 and December 31, 2022, would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis is based on foreign currency exchange rate variances that the Group considers to be reasonably possible at the end of the reporting period. The analysis assumes that all other variables, in particular interest rates, would remain constant. The changes in equity and profit or loss would have been as follows:


	September 30, 2023						December 31, 2022
(In millions of won)	Equity			Profit or loss			Equity			Profit or loss
USD (5 percent weakening)	W	(86,078	)		61,552			(114,317	)		(23,215	)
JPY (5 percent weakening)		(7,315	)		(7,394	)		(8,614	)		(8,541	)
CNY (5 percent weakening)		(178,381	)		(2	)		(105,926	)		(5	)
TWD (5 percent weakening)		118			7			68			3
EUR (5 percent weakening)		168			18			896			(281	)
PLN (5 percent weakening)		15			15			11			11
VND (5 percent weakening)		(2,544	)		(2,544	)		(6,161	)		(6,161	)

A stronger won against the above currencies as of September 30, 2023 and December 31, 2022 would have had the equal but opposite effect on the above currencies to the amounts shown above, on the basis that all other variables remain constant.

iii) Fair value hedging derivatives

In relation to advances received that are denominated in foreign currencies, the Controlling Company uses derivative instruments to hedge change of fair value due to foreign currency exchange rate changes. As of September 30, 2023, there is no ineffective portion of the gain or loss on valuation of derivatives to which change of fair value hedging accounting has been applied and gain and loss on valuation amounting to W20,014 million and W2,609 million, respectively, (contracted buying amount: USD 1,200 million, contracted exchange rate: W1,289.11 ~ 1,310.08) are recognized in profit or loss.

(ii) Interest rate risk

Interest rate risk arises principally from the Group’s variable interest-bearing bonds and borrowings. The Group establishes and applies its policy to reduce uncertainty arising from fluctuations in interest rates and to minimize finance cost and manages interest rate risk by monitoring of trends of fluctuations in interest rate and establishing plan for countermeasures. Meanwhile, the Group entered into cross currency interest rate swap contracts amounting to USD 1,565 million (W2,104,612 million) and interest rate swap contracts amounting to W990,000 million in notional amount to hedge interest rate risk with respect to variable interest-bearing borrowings.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

i) Profile

The interest rate profile of the Group’s interest-bearing financial instruments as of September 30, 2023 and December 31, 2022 is as follows:


(In millions of won)	September 30, 2023			December 31, 2022
Fixed rate instruments
Financial assets	W	4,087,313			3,547,256
Financial liabilities		(6,994,848	)		(6,025,365	)

	W	(2,907,535	)		(2,478,109	)

Variable rate instruments
Financial liabilities	W	(10,492,532	)		(8,966,045	)

ii) Equity and profit or loss sensitivity analysis for variable rate instruments

As of September 30, 2023 and December 31, 2022, a change of 100 basis points in interest rates at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below for the respective following 12 month periods. This analysis assumes that all other variables, in particular foreign currency rates, remain constant.


	Equity					Profit or loss
(In millions of won)	1%p increase			1%p decrease		1%p increase			1%p decrease
September 30, 2023
Variable rate instruments (*)	W	(57,523	)		57,523		(57,523	)		57,523
December 31, 2022
Variable rate instruments (*)	W	(49,885	)		49,885		(49,885	)		49,885

(*)	Financial instruments related to non-hedging interest rate swap are excluded from the calculation.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

(iii) Managing interest rate benchmark reform and associated risks

In response to the IBOR interest rate reform, the Group have completed the process of transitioning to an alternative benchmark rate. As of September 30, 2023, for the remaining IBORs with exposed consolidated entities, the interest rate benchmark will be changed from USD LIBOR to SOFR in the future, subject to the alternative provisions. The Group considers that a contract is not yet transitioned to an alternative benchmark rate when interest rate under the contract is indexed to a benchmark rate that is still subject to IBOR reform, even if it includes a fallback clause that deals with the cessation of the existing IBOR(“unreformed contracts”). As of September 30, 2023, the total amounts of unreformed contracts and those with appropriate fallback language are as follows:


(In millions of won)	Total amount of unreformed contracts		Amount with appropriate fallback clause
Non-derivative financial liabilities
Borrowings	W	134,480		134,480
Derivative assets
Cross currency interest rate swap contracts	W	198,533		198,533

(b)

Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Group’s receivables from customers.

The Group’s exposure to credit risk of trade and other receivables is influenced mainly by the individual characteristics of each customer. However, management believes that the default risk of the country in which each customer operates, do not have a significant influence on credit risk since the majority of the customers are global electronic appliance manufacturers operating in global markets.

The Group establishes credit limits for each customer and each new customer is analyzed quantitatively and qualitatively before determining whether to utilize third party guarantees, insurance or factoring as appropriate.

In relation to the impairment of financial assets subsequent to initial recognition, the Group recognizes the changes in expected credit loss (“ECL”) in profit or loss at each reporting date.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Financial assets carried at amortized cost
Cash equivalents	W	3,006,207		1,823,573
Deposits in banks		1,081,117		1,722,618
Trade accounts and notes receivable, net		2,351,050		2,358,914
Non-trade receivables		69,849		146,921
Accrued income		13,417		22,505
Deposits		19,166		26,586
Short-term loans		24,208		30,062
Long-term loans		41,691		58,806
Lease receivables		5,986		11,058

	W	6,612,691		6,201,043

Financial assets at fair value through profit or loss
Convertible securities	W	3,142		1,797
Derivatives		294,832		230,080

	W	297,974		231,877

Financial assets effective for fair value hedging
Derivatives		20,014		—

	W	6,930,679		6,432,920

Trade accounts and notes receivable are insured in order for the Group to manage credit risk if they do not meet the Group’s internal credit ratings. Uninsured trade accounts and notes receivable are managed by continuous monitoring of internal credit rating standards established by the Group and seeking insurance coverage, if necessary.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

(c)

Liquidity risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or other financial assets. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.

The Group has historically been able to satisfy its cash requirements from cash flows from operations and debt and equity financing. To the extent that the Group does not generate sufficient cash flows from operations to meet its capital requirements, the Group may rely on other financing activities, such as long-term borrowings and offerings of debt instruments, equity-linked and other debt instruments. In addition, the Group maintains a line of credit with various banks.

The following are the contractual maturities of financial liabilities, including estimated interest payments, as of September 30, 2023 and December 31, 2022.


			September 30, 2023
			Contractual cash flows in
(In millions of won)	Carrying amount		Total		6 months or less		6-12 months		1-2 years		2-5 years		More than 5 years
Non-derivative financial liabilities
Borrowings	W	15,994,167		17,382,776		4,273,329		1,413,097		5,904,663		5,447,676		344,011
Bonds		1,493,213		1,620,134		111,850		320,858		651,268		536,158		—
Trade accounts and notes payable		4,702,473		4,702,473		4,500,485		201,988		—		—		—
Other accounts payable		2,011,784		2,014,237		1,931,364		82,873		—		—		—
Other accounts payable (enterprise procurement cards)(*)		955,332		955,332		738,116		217,216		—		—		—
Long-term other accounts payable		413,197		476,569		—		—		135,158		200,207		141,204
Security deposits received		151,749		190,765		3,170		3,556		2,479		181,560		—
Lease liabilities		68,996		72,731		26,996		18,623		14,036		9,905		3,171
Derivative financial liabilities
Derivatives	W	17,667		7,555		399		5,017		934		1,205		—
Derivatives for fair value hedge		2,609		2,609		—		—		—		2,609		—

	W	25,811,187		27,425,181		11,585,709		2,263,228		6,708,538		6,379,320		488,386

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

(*)

Represents liabilities payable to credit card companies for purchase of raw materials and others paid using enterprise procurement cards. The Group presented the payable to credit card companies as other accounts payable and disclosed related cash flows as operating activities since the Group is using the enterprise procurement cards through agreements with suppliers for transactions arising from purchasing of goods and services, the payment term is within a year from the purchase, as part of the normal operating cycle, and no security is provided. Change in liabilities related to procurement cards for the nine-month period ended September 30, 2023 is as follows:

(In millions of won)

January 1, 2023

Change
(Cash flows from
operating activities)

September 30, 2023

Other accounts payable (enterprise procurement cards)

935,739

19,593

955,332

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.


			December 31, 2022
			Contractual cash flows in
(In millions of won)	Carrying amount		Total		6 months or less			6-12 months		1-2 years		2-5 years		More than 5 years
Non-derivative financial liabilities
Borrowings	W	13,542,664		14,674,463		4,329,345			1,266,247		3,135,925		5,591,303		351,643
Bonds		1,448,746		1,570,630		338,815			16,956		400,764		727,752		86,343
Trade accounts and notes payable		4,061,684		4,061,684		3,523,098			538,586		—		—		—
Other accounts payable		2,307,190		2,309,929		2,231,832			78,097		—		—		—
Other accounts payable (enterprise procurement cards)(*)		935,739		935,739		935,739			—		—		—		—
Long-term other accounts payable		435,232		508,194		—			—		103,450		245,064		159,680
Security deposits received		146,788		191,735		—			2,262		8,463		181,010		—
Lease liabilities		72,788		77,803		26,733			16,995		18,552		10,743		4,780
Derivative financial liabilities
Derivatives	W	47,408		29,418		(1,637	)		10,741		3,024		17,290		—

	W	22,998,239		24,359,595		11,383,925			1,929,884		3,670,178		6,773,162		602,446

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

(*)

Represents liabilities payable to credit card companies for utility expenses and others paid using enterprise procurement cards. The Group presented the payable to credit card companies as other accounts payable and disclosed related cash flows as operating activities since the Group is using the enterprise procurement cards through agreements with suppliers for transactions arising from purchasing of goods and services, the payment term is within a year from the purchase, as part of the normal operating cycle, and no security is provided. Change in liabilities related to procurement cards for the year period ended December 31, 2022 is as follows:


(In millions of won)	January 1, 2022		Change (Cash flows from operating activities)			December 31, 2022
Other accounts payable (enterprise procurement cards)	W	1,074,089		(138,350	)		935,739

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.

(d)

Capital management

Management’s policy is to maintain a capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Liabilities to equity ratio, net borrowings to equity ratio and other financial ratios are used by management to achieve an optimal capital structure. Management also monitors the return on capital as well as the level of dividends to ordinary shareholders.


(In millions of won)	September 30, 2023		December 31, 2022
Total liabilities	W	28,647,540		24,366,792
Total equity		8,890,192		11,319,227
Cash and deposits in banks (*1)		4,087,316		3,547,256
Borrowings (including bonds)		17,487,380		14,991,410
Total liabilities to equity ratio		322%		215%
Net borrowings to equity ratio (*2)		151%		101%

(*1)	Cash and deposits in banks consist of cash and cash equivalents and current deposits in banks.

(*2)	Net borrowings to equity ratio is calculated by dividing total borrowings (including bonds and excluding lease liabilities and others) less cash and current deposits in banks by total equity.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

(e)

Determination of fair value

(i)

Measurement of fair value

A number of the Group’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

Current assets and liabilities

The carrying amounts approximate their fair value because of the short maturity of these instruments.

ii)

Trade receivables and other receivables

The fair value of trade and other receivables is estimated as the present value of future cash flows, discounted at the market rate of interest at the reporting date. This fair value is determined for disclosure purposes. The carrying amounts of current receivables approximate their fair value.

iii)

Investments in equity and debt securities

The fair value of marketable financial assets at FVTPL and FVOCI is determined by reference to their quoted closing bid price at the reporting date. The fair value of non-marketable instruments is determined using the results of fair value assessment performed by external valuation institutions and others.

iv)

Non-derivative financial liabilities

Fair value, which is determined for disclosure purposes, except for the liabilities at FVTPL, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date.

Derivatives

The inputs used to measure the fair value of currency forward and cross currency interest rate swap are calculated based on the exchange rates and interest rates observable in the market at the reporting date.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

(ii)

Fair values versus carrying amounts

The fair values of financial assets and liabilities, together with the carrying amounts shown in the condensed consolidated interim statements of financial position as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023				December 31, 2022
(In millions of won)	Carrying amounts		Fair values		Carrying amounts		Fair values
Financial assets carried at amortized cost
Cash and cash equivalents	W	3,006,210		(*)		1,824,649		(*)
Deposits in banks		1,081,117		(*)		1,722,618		(*)
Trade accounts and notes receivable		2,351,050		(*)		2,358,914		(*)
Non-trade receivables		69,849		(*)		146,921		(*)
Accrued income		13,417		(*)		22,505		(*)
Deposits		19,166		(*)		26,586		(*)
Short-term loans		24,208		(*)		30,062		(*)
Long-term loans		41,691		(*)		58,806		(*)
Lease receivables		5,986		(*)		11,058		(*)
Financial assets at fair value through profit or loss
Equity instruments	W	92,867		92,867		96,064		96,064
Convertible securities		3,142		3,142		1,797		1,797
Derivatives		294,832		294,832		230,080		230,080
Financial assets effective for fair value hedging
Derivatives	W	20,014		20,014		—		—
Financial liabilities at fair value through profit or loss
Derivatives	W	17,667		17,667		47,408		47,408
Financial liabilities effective for fair value hedging
Derivatives	W	2,609		2,609		—		—
Financial liabilities carried at amortized cost
Borrowings	W	15,994,167		16,021,704		13,542,664		13,521,494
Bonds		1,493,213		1,470,144		1,448,746		1,377,696
Trade accounts and notes payable		4,702,473		(*)		4,061,684		(*)
Other accounts payable		2,967,116		(*)		3,242,929		(*)
Long-term other accounts payable		413,197		(*)		435,232		(*)
Security deposits received		151,749		(*)		146,788		(*)
Lease liabilities		68,996		(*)		72,788		(*)

(*)	Excluded from disclosures as the carrying amount approximates fair value.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

(iii)

Fair values of financial assets and liabilities

i) Fair value hierarchy

Financial instruments carried at fair value are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques. The different levels have been defined as follows:

•

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities

•

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly

•

Level 3: inputs for the asset or liability that are not based on observable market data

ii) Financial instruments measured at fair value

Fair value hierarchy classifications of the financial instruments that are measured at fair value as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023
(In millions of won)	Level 1		Level 2		Level 3		Total
Financial assets at fair value through profit or loss
Equity instruments	W	—		—		92,867		92,867
Convertible securities		—		—		3,142		3,142
Derivatives		—		294,832		—		294,832
Financial assets effective for fair value hedging
Derivatives	W	—		20,014		—		20,014
Financial liabilities at fair value through profit or loss
Derivatives	W	—		17,667		—		17,667
Financial liabilities effective for fair value hedging
Derivatives	W	—		2,609		—		2,609

	December 31, 2022
(In millions of won)	Level 1		Level 2		Level 3		Total
Financial assets at fair value through profit or loss
Equity instruments	W	—		—		96,064		96,064
Convertible securities		—		—		1,797		1,797
Derivatives		—		230,080		—		230,080
Financial liabilities at fair value through profit or loss
Derivatives	W	—		47,408		—		47,408

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

iii)

Valuation techniques and inputs for Assets and Liabilities measured by the fair value hierarchy Level 2 and Level 3

Fair value hierarchy classifications, valuation technique and inputs for fair value measurements as of September 30, 2023 and December 31, 2022 are as follows:

(In millions of won)

September 30, 2023

Valuation
technique

Input

Classification

Level 1

Level 2

Level 3

Financial assets at fair value through profit or loss

Equity instruments

—

92,867

Discounted
cash flow, etc.

Discount rate
and Estimated
cash flow, etc.

Convertible securities

—

3,142

Blended discount
model and
binominal option
pricing model

Discount rate,
stock price and
volatility

Derivatives

—

294,832

—

Discounted cash
flow

Discount rate
and Exchange
rate

Financial assets effective for fair value hedging

Derivatives

—

20,014

—

Discounted cash
flow

Discount rate
and Exchange
rate

Financial liabilities at fair value through profit or loss

Derivatives

—

17,667

—

Discounted cash
flow

Discount rate
and Exchange
rate

Financial liabilities effective for fair value hedging

Derivatives

—

2,609

—

Discounted cash
flow

Discount rate
and Exchange
rate

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

(In millions of won)

December 31, 2022

Valuation
technique

Input

Classification

Level 1

Level 2

Level 3

Financial assets at fair value through profit or loss

Equity instruments

—

96,064

Discounted cash
flow, etc.

Discount rate
and Estimated
cash flow, etc.

Convertible securities

—

1,797

Blended
discount model
and binominal
option pricing
model

Discount rate,
stock price
and volatility

Derivatives

—

230,080

—

Discounted cash
flow

Discount rate
and Exchange
rate

Financial liabilities at fair value through profit or loss

Derivatives

—

47,408

—

Discounted cash
flow

Discount rate
and Exchange
rate

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

iv)

Financial instruments not measured at fair value but for which the fair value is disclosed

Fair value hierarchy classifications, valuation technique and inputs for fair value measurements of the financial instruments not measured at fair value but for which the fair value is disclosed as of September 30, 2023 and December 31, 2022 are as follows:

(In millions of won)

September 30, 2023

Valuation
technique

Input

Classification

Level 1

Level 2

Level 3

Liabilities

Borrowings

—

16,021,704

Discounted
cash flow

Discount
rate

Bonds

—

1,470,144

Discounted
cash flow

Discount
rate

(In millions of won)

December 31, 2022

Valuation
technique

Input

Classification

Level 1

Level 2

Level 3

Liabilities

Borrowings

—

13,521,494

Discounted
cash flow

Discount
rate

Bonds

—

1,377,696

Discounted
cash flow

Discount
rate

The interest rates applied for determination of the above fair value as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023			December 31, 2022
Borrowings, bonds and others		4.75 ~ 5.86	%		5.11 ~ 6.68	%

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Financial Risk Management, Continued

vi)

There were no transfer between Level 1, Level 2 and Level 3 for the nine-month periods ended September 30, 2023 and 2022, and the changes in financial assets classified as Level 3 of fair value measurements for the nine-month periods ended September 30, 2023 and 2022 are as follows:


(In millions of won)
Classification	January 1, 2023		Acquisition		Disposal			Valuation			Changes in Foreign Exchange Rates		September 30, 2023
Equity securities	W	96,064		2,476		(498	)		(10,372	)		5,197		92,867
Convertible securities		1,797		1,329		—			—			16		3,142


(In millions of won)
Classification	January 1, 2022		Acquisition		Disposal			Valuation			Changes in Foreign Exchange Rates		Transfer			September 30, 2022
Equity securities	W	48,805		27,261		(775	)		(1,204	)		13,001		11,804			98,892
Convertible securities		2,758		—		—			—			—		(1,185	)		1,573

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Changes in liabilities arising from financing activities

Changes in liabilities arising from financing activities for the nine-month periods ended September 30, 2023 and 2022 are as follows:


						Non-cash transactions
(In millions of won)	January 1, 2023		Cash flows from financing activities			Reclassification			Gain or loss on foreign currency translation		Effective interest adjustment		Others		September 30, 2023
Short-term borrowings	W	2,578,552		(60,760	)		—			58,248		—		—		2,576,040
Current portion of long-term borrowings and bonds		2,855,565		(2,477,672	)		2,329,616			119,090		164		167		2,826,930
Long-term borrowings		8,425,195		4,170,987			(1,850,264	)		205,811		2,508		6,561		10,960,798
Bonds		1,132,098		469,266			(479,352	)		488		1,112		—		1,123,612
Lease liabilities		72,788		(56,659	)		—			2,960		—		49,907		68,996
Dividend payable		—		(34,098	)		—			—		—		34,098		—

	W	15,064,198		2,011,064			—			386,597		3,784		90,733		17,556,376

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Changes in liabilities arising from financing activities, Continued


						Non-cash transactions
(In millions of won)	January 1, 2022		Cash flows from financing activities			Reclassification			Gain or loss on foreign currency translation		Effective interest adjustment		Others			September 30, 2022
Short-term borrowings	W	613,733		1,654,311			—			253,071		—		—			2,521,115
Current portion of long-term borrowings and bonds(*)		3,393,506		(3,913,540	)		3,005,066			356,116		11,433		(217,815	)		2,634,766
Long-term borrowings		7,660,591		3,283,880			(2,696,864	)		755,947		—		—			9,003,554
Bonds		995,976		443,230			(308,202	)		—		812		—			1,131,816
Lease liabilities		84,326		(61,214	)		—			18,416		—		51,783			93,311
Dividend payable		3,679		(255,415	)		—			—		—		290,301			38,565

	W	12,751,811		1,151,252			—			1,383,550		12,245		124,269			15,423,127

(*)	Others include W220,355 million of gain on valuation of financial liabilities at fair value through profit or loss and W2,540 million of loss on early repayment of borrowings and bonds.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others

(a)

Related parties

Related parties as of September 30, 2023 are as follows:


Classification		Description
Associates(*)		Paju Electric Glass Co., Ltd. and others
Entity that has significant influence over the Controlling Company		LG Electronics Inc.
Subsidiaries of the entity that has significant influence over the Controlling Company		Subsidiaries of LG Electronics Inc.

(*)	Details of associates are described in Note 8.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued

(b)

Significant transactions such as sales of goods and purchases of raw material and outsourcing service and others, which occurred in the normal course of business with related parties for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates
AVATEC Co., Ltd.	W	—		—		250		—		10,857		2,934
Paju Electric Glass Co., Ltd.		—		—		47,722		—		—		1,334
WooRee E&L Co., Ltd.		—		—		405		—		—		9
YAS Co., Ltd.		—		—		2,335		1,623		—		1,071
Material Science Co., Ltd.		—		—		—		—		—		13

	W	—		—		50,712		1,623		10,857		5,361

Entity that has significant influence over the Controlling Company
LG Electronics Inc.	W	56,369		—		5,564		100,272		—		41,490
Subsidiaries of the entity that has significant influence over the Controlling Company
LG Electronics India Pvt. Ltd.	W	20,316		—		—		—		—		27
LG Electronics Vietnam Haiphong Co., Ltd.		81,457		—		—		381		—		172

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
LG Electronics Nanjing New Technology Co., Ltd.	W	92,309		—		—		—		—		117
LG Electronics do Brasil Ltda.		8,174		—		—		—		—		30
LG Innotek Co., Ltd.		2,757		—		1,233		—		—		27,686
LG Electronics Mlawa Sp. z o.o.		152,543		—		—		—		—		427
LG Electronics Reynosa, S.A. DE C.V.		216,513		—		—		—		—		128
LG Electronics Egypt S.A.E		4,052		—		—		—		—		7
LG Electronics Japan, Inc.		—		—		—		6		—		1,568
LG Electronics RUS, LLC		2		—		—		—		—		1,449
LG Electronics U.S.A., Inc.		—		—		—		—		—		472
P.T. LG Electronics Indonesia		81,653		—		—		—		—		673
LG Technology Ventures LLC		—		—		—		—		—		971
HI-M Solutek Co., Ltd		—		—		—		—		—		1,956
Others		357		—		38		—		—		383

	W	660,133		—		1,271		387		—		36,066

	W	716,502		—		57,547		102,282		10,857		82,917

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates
AVATEC Co., Ltd.	W	—		—		442		—		30,234		6,644
Paju Electric Glass Co., Ltd.		—		15,200		122,537		—		—		2,739
WooRee E&L Co., Ltd.		—		—		1,155		—		—		10
YAS Co., Ltd.		—		—		6,462		10,351		—		4,209
Material Science Co., Ltd.		—		—		—		—		—		72

	W	—		15,200		130,596		10,351		30,234		13,674

Entity that has significant influence over the Controlling Company
LG Electronics Inc.	W	168,939		—		14,417		267,719		—		133,862
Subsidiaries of the entity that has significant influence over the Controlling Company
LG Electronics India Pvt. Ltd.	W	42,703		—		—		—		—		163
LG Electronics Vietnam Haiphong Co., Ltd.		334,522		—		—		5,368		—		575
LG Electronics Nanjing New Technology Co., Ltd.		262,532		—		—		—		—		344
LG Electronics do Brasil Ltda.		22,625		—		—		—		—		92
LG Innotek Co., Ltd.		5,986		—		10,333		—		—		77,164

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
LG Electronics Mlawa Sp. z o.o.	W	523,404		—		—		—		—		1,205
LG Electronics Reynosa, S.A. DE C.V.		594,690		—		—		—		—		485
LG Electronics Egypt S.A.E		18,732		—		—		—		—		63
LG Electronics Japan, Inc.		—		—		—		18		—		4,565
LG Electronics RUS, LLC		359		—		—		—		—		2,062
LG Electronics U.S.A., Inc.		—		—		—		—		—		1,606
P.T. LG Electronics Indonesia		342,184		—		—		—		—		1,842
LG Technology Ventures LLC		—		—		—		—		—		2,275
HI-M Solutek Co., Ltd		—		—		9		—		—		6,825
Others		1,068		—		84		—		—		1,010

	W	2,148,805		—		10,426		5,386		—		100,276

	W	2,317,744		15,200		155,439		283,456		30,234		247,812

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2022
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates
AVATEC Co., Ltd.	W	—		—		—		—		17,324		1,245
Paju Electric Glass Co., Ltd.		—		—		47,187		—		—		798
WooRee E&L Co., Ltd.		—		—		4,369		—		—		—
YAS Co., Ltd.		—		—		2,400		7,385		—		2,408
Material Science Co., Ltd.		—		—		—		—		—		—

	W	—		—		53,956		7,385		17,324		4,451

Entity that has significant influence over the Controlling Company
LG Electronics Inc.	W	61,280		—		4,992		171,616		—		33,734
Subsidiaries of the entity that has significant influence over the Controlling Company
LG Electronics India Pvt. Ltd.	W	31,204		—		—		—		—		101
LG Electronics Vietnam Haiphong Co., Ltd.		139,145		—		—		—		—		112
LG Electronics Nanjing New Technology Co., Ltd.		85,713		—		—		—		—		783
LG Electronics RUS, LLC		58		—		—		—		—		16
LG Electronics do Brasil Ltda.		23,440		—		—		—		—		24

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2022
	Sales and others				Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
LG Innotek Co., Ltd.	W	1,967		—		1,599		—		—		18,689
LG Electronics Mlawa Sp. z o.o.		280,755		—		—		—		—		267
LG Electronics Reynosa, S.A. DE C.V.		331,264		—		—		—		—		296
LG Electronics Egypt S.A.E		28,220		—		—		—		—		179
LG Electronics Japan, Inc.		—		—		—		6		—		2,395
P.T. LG Electronics Indonesia		154,290		—		—		—		—		227
LG Electronics Taiwan Taipei Co., Ltd.		30		—		—		—		—		183
LG Technology Ventures LLC		—		—		—		—		—		1,334
HI-M Solutek Co., Ltd		—		—		36		—		—		2,938
LG Electronics U.S.A., Inc.		—		—		—		—		—		581
Others		310		—		110		607		—		197

	W	1,076,396		—		1,745		613		—		28,322

	W	1,137,676		—		60,693		179,614		17,324		66,507

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2022
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates
AVATEC Co., Ltd.	W	—		—		58		—		49,007		2,114
Paju Electric Glass Co., Ltd.		—		4,361		208,133		—		—		2,306
WooRee E&L Co., Ltd.		—		—		10,903		—		—		2
YAS Co., Ltd.		—		100		12,182		13,461		—		6,299
Material Science Co., Ltd.		—		—		17		—		—		—

	W	—		4,461		231,293		13,461		49,007		10,721

Entity that has significant influence over the Controlling Company
LG Electronics Inc.	W	168,657		—		14,799		456,482		—		93,296
Subsidiaries of the entity that has significant influence over the Controlling Company
LG Electronics India Pvt. Ltd.	W	61,598		—		—		—		—		393
LG Electronics Vietnam Haiphong Co., Ltd.		325,101		—		—		—		—		674
LG Electronics Nanjing New Technology Co., Ltd.		272,497		—		—		—		—		1,103
LG Electronics RUS, LLC		21,783		—		—		—		—		400
LG Electronics do Brasil Ltda.		73,097		—		—		—		—		176
LG Innotek Co., Ltd.		4,852		—		5,210		—		—		61,979

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2022
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
LG Electronics Mlawa Sp. z o.o.	W	738,516		—		—		—		—		674
LG Electronics Reynosa, S.A. DE C.V.		863,392		—		—		—		—		692
LG Electronics Egypt S.A.E		64,943		—		—		—		—		336
LG Electronics Japan, Inc.		—		—		—		13		—		5,650
P.T. LG Electronics Indonesia		416,606		—		—		—		—		979
LG Electronics Taiwan Taipei Co., Ltd.		3,431		—		—		—		—		438
LG Technology Ventures LLC		—		—		—		—		—		3,643
HI-M Solutek Co., Ltd		—		—		45		—		—		7,153
LG Electronics U.S.A., Inc.		—		—		—		—		—		1,426
Others		316		—		588		607		—		615

	W	2,846,132		—		5,843		620		—		86,331

	W	3,014,789		4,461		251,935		470,563		49,007		190,348

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued

(c)

Trade accounts and notes receivable and payable and others as of September 30, 2023 and December 31, 2022 are as follows:


	Trade accounts and notes receivable and others				Trade accounts and notes payable and others
(In millions of won)	September 30, 2023		December 31, 2022		September 30, 2023		December 31, 2022
Associates
AVATEC Co., Ltd.	W	—		—		2,296		3,756
Paju Electric Glass Co., Ltd.		—		—		48,776		30,431
WooRee E&L Co., Ltd.		805		878		2,470		1,502
YAS Co., Ltd.		—		—		5,376		7,680
Material Science Co., Ltd.		—		—		15		—

	W	805		878		58,933		43,369

Entity that has significant influence over the Controlling Company
LG Electronics Inc. (*1)	W	52,851		69,447		1,133,203		99,934

Subsidiaries of the entity that has significant influence over the Controlling Company
LG Electronics India Pvt. Ltd	W	14,047		5,669		10		15
LG Electronics Vietnam Haiphong Co., Ltd.		30,246		50,173		895		53
LG Electronics Nanjing New Technology Co., Ltd.		45,181		30,018		54		—
LG Electronics do Brasil Ltda.		6,260		10,997		—		—
LG Innotek Co., Ltd. (*2)		2,574		3,838		228,777		209,032

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued



	Trade accounts and notes receivable and others				Trade accounts and notes payable and others
(In millions of won)	September 30, 2023		December 31, 2022		September 30, 2023		December 31, 2022
LG Electronics Mlawa Sp. z o.o.	W	83,487		94,346		2		155
LG Electronics Reynosa, S.A. DE C.V.		119,126		16,760		18		167
LG Electronics Japan, Inc.		—		—		577		566
P.T. LG Electronics Indonesia		55,242		45,617		90		195
LG Electronics Taiwan Taipei Co., Ltd.		—		—		74		77
LG Electronics Egypt S.A.E		2,080		—		4		—
Others		155		2,260		6,300		4,574

	W	358,398		259,678		236,801		214,834

	W	412,054		330,003		1,428,937		358,137

(*1)	Trade accounts and note payable and others for LG Electronics Inc. as of September 30, 2023 includes long-term borrowings of W1,000,000 million. (see note 12.(c))

(*2)	Including deposits received amount W180,000 million from lease agreement.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued

(d)

Details of significant financing transactions with related parties for the nine-month period ended September 30, 2023, is as follows.


(In millions of won)
Entity that has significant influence over the Controlling Company	Borrowings
LG Electronics Inc. (*)	W	1,000,000

Associates	Collection of loans
WooRee E&L Co., Ltd.	W	73

(*)	The Group entered into a loan agreement with LG Electronics Inc. on March 27, 2023 for a total borrowing amount of W1,000,000 million, and received W650,000 million on March 30, 2023 and W350,000 million on April 20, 2023.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued

(e)

Conglomerate Transactions

Transactions, trade accounts and notes receivable and payable, and others between the Group and certain companies and their subsidiaries included in LG Group, one of the conglomerates in the Republic of Korea according to the Monopoly Regulation and Fair Trade Act, for the three-month and nine-month periods ended September 30, 2023 and 2022 and as of September 30, 2023 and December 31, 2022 are as follows. These entities are not related parties according to K-IFRS No. 1024, Related Party Disclosures.


	For the three-month period ended September 30, 2023				For the nine-month period ended September 30, 2023				September 30, 2023
(In millions of won)	Sales and others		Purchase and others		Sales and others		Purchase and others		Trade accounts and notes receivable and others		Trade accounts and notes payable and others
LG Uplus Corp.	W	—		600		—		1,853		—		206
LG Chem Ltd. and its subsidiaries		109		126,023		318		341,779		82		200,363
D&O Corp. and its subsidiaries		84		105,669		1,932		564,330		175		137,328
LG Corp.		—		11,840		1,891		34,672		17,895		5,575
LG Management Development Institute		—		9,252		—		31,151		—		641
LG CNS Co., Ltd. and its subsidiaries		1		62,586		8		178,433		1		53,877
LG Household & Health Care and its subsidiaries		—		52		—		109		—		53
HS Ad Inc. and its subsidiaries (formerly, G2R Inc. and its subsidiaries) (*)		—		1,703		—		11,085		—		2,804
Robostar Co., Ltd.		—		19		—		775		—		206

	W	194		317,744		4,149		1,164,187		18,153		401,053

(*)	G2R Inc. renamed its name as HS Ad Inc. on July 1, 2023.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2022				For the nine-month period ended September 30, 2022				December 31, 2022
(In millions of won)	Sales and others		Purchase and others		Sales and others		Purchase and others		Trade accounts and notes receivable and others		Trade accounts and notes payable and others
LX International Corp. and its subsidiaries (*1)	W	—		—		201,144		165,875		—		—
LG Uplus Corp.		—		621		—		1,860		—		349
LG Chem Ltd. and its subsidiaries		54		135,755		238		436,421		75		78,925
D&O Corp. and its subsidiaries (formerly, S&I Corp.and its subsidiaries) (*2)		77		279,877		230		833,796		—		284,373
LX Semicon Co., Ltd. (*1)		—		—		—		723,152		—		—
LG Corp.		—		15,577		—		43,775		14,979		6,287
LG Management Development Institute		—		8,531		—		26,276		—		524
LG CNS Co., Ltd. and its subsidiaries		8		68,502		23		169,450		20		94,287
LG Household & Health Care and its subsidiaries		—		129		—		281		—		—
G2R Inc. and its subsidiaries		—		9,537		—		28,221		—		11,193
Robostar Co., Ltd.		—		335		—		1,343		—		407

	W	139		518,864		201,635		2,430,450		15,074		476,345

(*1)	The separation of LX affiliates was approved by the Fair Trade Commission on June 21, 2022

(*2)	S&I Corp. renamed its name as D&O Corp. on April 1, 2022.

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

28.	Related Parties and Others, Continued

(f)

Key management personnel compensation

Compensations cost of key management for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Short-term benefits	W	576		580		1,715		1,734
Expenses related to the defined benefit plan		89		89		266		329

	W	665		669		1,981		2,063

Key management refers to the registered directors who have significant control and responsibilities over the Controlling Company’s operations and business.

LG DISPLAY CO., LTD.

Condensed Separate Interim Financial Statements

(Unaudited)

September 30, 2023 and 2022

(With Independent Auditors’ Review Report Thereon)

100

Table of Contents


	Page

Independent Auditors’ Review Report		102

Condensed Separate Interim Statements of Financial Position		104

Condensed Separate Interim Statements of Comprehensive Loss		105

Condensed Separate Interim Statements of Changes in Equity		106

Condensed Separate Interim Statements of Cash Flows		107

Notes to the Condensed Separate Interim Financial Statements		109

101

Independent Auditors’ Review Report

Based on a report originally issued in Korean

To the Board of Directors and Shareholders

LG Display Co., Ltd.:

Reviewed Financial Statements

We have reviewed the accompanying condensed separate interim financial statements of LG Display Co., Ltd. (the “Company”) which comprise the condensed separate interim statement of financial position as of September 30, 2023, the condensed separate interim statements of comprehensive loss for the three-month and nine-month periods ended September 30, 2023 and 2022, and statements of changes in equity and cash flows for the nine-month periods ended September 30, 2023 and 2022, and notes comprising material accounting policy information and other explanatory information.

Management’s Responsibility for the Condensed Separate Interim Financial Statements

Management is responsible for the preparation and fair presentation of these condensed separate interim financial statements in accordance with Korean International Financial Reporting Standards No. 1034, Interim Financial Reporting, and for such internal controls as management determines necessary to enable the preparation of condensed separate interim financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to issue a report on these condensed separate interim financial statements based on our reviews.

Conclusion

Based on our reviews, nothing has come to our attention that causes us to believe that the condensed separate interim financial statements referred to above are not presented fairly, in all material respects, in accordance with Korean International Financial Reporting Standards No. 1034, Interim Financial Reporting.

Other Matters

The procedures and practices utilized in the Republic of Korea to review such condensed separate interim financial statements may differ from those generally accepted and applied in other countries.

We audited the separate statement of financial position as of December 31, 2022, and the related separate statements of comprehensive loss, changes in equity and cash flows for the year then ended, which are not accompanying this review report, in accordance with Korean Standards on Auditing, and our report thereon, dated March 3, 2023, expressed an unmodified opinion. The accompanying condensed separate statement of financial position of the Company as of December 31, 2022, presented for comparative purposes, is not different from that audited by us from which it was derived in all material respects.

102

KPMG Samjong Accounting Corp.

Seoul, Korea

November 13, 2023

This report is effective as of November 13, 2023, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying condensed separate interim financial statements and notes thereto. Accordingly, the readers of the review report should understand that the above review report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

103

LG DISPLAY CO., LTD.

Condensed Separate Interim Statements of Financial Position

(Unaudited)

As of September 30, 2023 and December 31, 2022


(In millions of won)	Note		September 30, 2023		December 31, 2022
Assets
Cash and cash equivalents		4, 25	W	148,684		692,312
Deposits in banks		4, 25		20,000		42,804
Trade accounts and notes receivable, net		5, 15, 25, 27		2,620,982		2,475,920
Other accounts receivable, net		5, 25		74,007		135,116
Other current financial assets		6, 25		261,737		149,479
Inventories		7		2,319,891		1,924,594
Prepaid income tax				1,664		1,092
Other current assets		5		208,479		205,860

Total current assets				5,655,444		5,627,177

Deposits in banks		4, 25		11		11
Investments		8		5,061,695		4,837,704
Other non-current accounts receivable, net		5, 25		16,121		13,364
Other non-current financial assets		6, 25		131,743		190,067
Property, plant and equipment, net		9		13,929,948		14,044,844
Intangible assets, net		10		1,638,906		1,635,181
Investment property		11		34,279		28,269
Deferred tax assets		23		3,385,944		2,413,563
Defined benefits assets, net		13		366,497		447,521
Other non-current assets				24,410		21,338

Total non-current assets				24,589,554		23,631,862

Total assets			W	30,244,998		29,259,039

Liabilities
Trade accounts and notes payable		25, 27	W	8,616,252		8,391,251
Current financial liabilities		12, 25, 26		4,021,723		4,014,046
Other accounts payable		25		2,298,609		2,813,350
Accrued expenses				525,953		558,503
Provisions		14		124,675		172,092
Advances received		15		429,674		28,184
Other current liabilities				60,794		65,585

Total current liabilities				16,077,680		16,043,011
Non-current financial liabilities		12, 25, 26, 27		6,469,911		5,119,695
Non-current provisions		14		65,511		86,157
Long-term advances received		15		1,210,320		—
Other non-current liabilities		25		661,872		659,737

Total non-current liabilities				8,407,614		5,865,589

Total liabilities				24,485,294		21,908,600

Equity
Share capital		16		1,789,079		1,789,079
Share premium		16		2,251,113		2,251,113
Retained earnings				1,719,512		3,310,247

Total equity				5,759,704		7,350,439

Total liabilities and equity			W	30,244,998		29,259,039

See accompanying notes to the condensed separate interim financial statements.

104

LG DISPLAY CO., LTD.

Condensed Separate Interim Statements of Comprehensive Loss

(Unaudited)

For the three-month and nine-month periods ended September 30, 2023 and 2022


(In millions of won, except earnings per share)	Note		For the three-month period ended September 30						For the nine-month period ended September 30
			2023			2022			2023			2022
Revenue		17, 27	W	4,688,687			6,185,523		W	12,960,038			17,703,943
Cost of sales		7, 18, 27		(4,726,328	)		(6,590,402	)		(14,946,610	)		(17,941,397	)

Gross loss				(37,641	)		(404,879	)		(1,986,572	)		(237,454	)

Selling expenses		18, 19		(62,221	)		(144,236	)		(207,011	)		(413,623	)
Administrative expenses		18, 19		(145,087	)		(150,717	)		(440,533	)		(431,980	)
Research and development expenses		18		(344,230	)		(343,369	)		(1,032,399	)		(975,495	)

Operating loss				(589,179	)		(1,043,201	)		(3,666,515	)		(2,058,552	)

Finance income		22		99,477			432,210			2,383,109			1,030,406
Finance costs		22		(200,967	)		(487,778	)		(720,590	)		(892,993	)
Other non-operating income		21		208,109			781,096			662,852			1,514,420
Other non-operating expenses		18, 21		(358,343	)		(1,140,337	)		(1,130,484	)		(1,934,156	)

Loss before income tax				(840,903	)		(1,458,010	)		(2,471,628	)		(2,340,875	)
Income tax benefit		23		(199,589	)		(417,562	)		(881,630	)		(645,163	)

Loss for the period				(641,314	)		(1,040,448	)		(1,589,998	)		(1,695,712	)

Other comprehensive income (loss)
Items that will never be reclassified to profit or loss
Remeasurements of net defined benefit liabilities		13		46			(4,960	)		(737	)		143,521
Items that will be reclassified to profit or loss
Loss on valuation of derivative				—			(25,252	)		—			(68,051	)
Other comprehensive income (loss) for the period, net of income tax				46			(30,212	)		(737	)		75,470

Total comprehensive loss for the period			W	(641,268	)		(1,070,660	)	W	(1,590,735	)		(1,620,242	)

Loss per share (in won)
Basic loss per share		24	W	(1,792	)		(2,908	)	W	(4,444	)		(4,739	)

Diluted loss per share		24	W	(1,792	)		(2,908	)	W	(4,444	)		(4,739	)

See accompanying notes to the condensed separate interim financial statements.

105

LG DISPLAY CO., LTD.

Condensed Separate Interim Statements of Changes in Equity

(Unaudited)

For the nine-month periods ended September 30, 2023 and 2022


(In millions of won)	Share capital		Share premium		Retained earnings			Other capital			Total equity
Balances at January 1, 2022	W	1,789,079		2,251,113		6,611,853			(9,227	)		10,642,818

Total comprehensive loss for the period
Loss for the period		—		—		(1,695,712	)		—			(1,695,712	)

Other comprehensive income (loss)
Remeasurements of net defined benefit liabilities, net of tax		—		—		143,521			—			143,521
Loss on valuation of derivative		—		—		—			(68,051	)		(68,051	)

Total other comprehensive income (loss)		—		—		143,521			(68,051	)		75,470

Total comprehensive loss for the period	W	—		—		(1,552,191	)		(68,051	)		(1,620,242	)

Transaction with owners, recognized directly in equity
Dividends to equity holders	W	—		—		(232,580	)		—			(232,580	)

Balances at September 30, 2022	W	1,789,079		2,251,113		4,827,082			(77,278	)		8,789,996

Balances at January 1, 2023	W	1,789,079		2,251,113		3,310,247			—			7,350,439

Total comprehensive loss for the period
Loss for the period		—		—		(1,589,998	)		—			(1,589,998	)

Other comprehensive income (loss)
Remeasurements of net defined benefit liabilities, net of tax		—		—		(737	)		—			(737	)

Total comprehensive loss for the period	W	—		—		(1,590,735	)		—			(1,590,735	)

Balances at September 30, 2023	W	1,789,079		2,251,113		1,719,512			—			5,759,704

See accompanying notes to the condensed separate interim financial statements.

106

LG DISPLAY CO., LTD.

Condensed Separate Interim Statements of Cash Flows

(Unaudited)

For the nine-month periods ended September 30, 2023 and 2022


(In millions of won)	Note		2023			2022
Cash flows from operating activities:
Loss for the period			W	(1,589,998	)		(1,695,712	)
Adjustments for:
Income tax benefit		23		(881,630	)		(645,163	)
Depreciation and amortization		18		1,659,876			1,797,931
Gain on foreign currency translation				(120,271	)		(459,131	)
Loss on foreign currency translation				294,043			984,083
Expenses related to defined benefit plans		13		110,653			129,523
Gain on disposal of property, plant and equipment				(28,089	)		(14,063	)
Loss on disposal of property, plant and equipment				77,295			35,801
Impairment loss on property, plant and equipment				6,760			3,351
Gain on disposal of intangible assets				(1,989	)		—
Loss on disposal of intangible assets				55			163
Impairment loss on intangible assets				50,900			19,388
Reversal of impairment loss on intangible assets				(242	)		(5,571	)
Expense on increase of provisions				31,279			149,737
Finance income				(2,340,512	)		(979,204	)
Finance costs				709,652			880,442
Other income				(6,659	)		(133,345	)
Other expenses				—			6

				(438,879	)		1,763,948
Changes in:
Trade accounts and notes receivable				(53,832	)		1,771,520
Other accounts receivable				60,766			(14,761	)
Inventories				(395,297	)		(710,221	)
Other current assets				10,719			(97,898	)
Other non-current assets				(4,022	)		(2,879	)
Trade accounts and notes payable				7,527			1,501,700
Other accounts payable				(169,370	)		(453,249	)
Accrued expenses				(44,236	)		(425,214	)
Provisions				(99,458	)		(157,028	)
Advances received				(1,951	)		6,325
Other current liabilities				(22,340	)		(582	)
Defined benefit liabilities, net				(30,580	)		(10,139	)
Long-term advances received				1,580,222			—
Other non-current liabilities				29,134			(23,200	)

				867,282			1,384,374
Cash generated from operating activities				(1,161,595	)		1,452,610
Income taxes refunded (paid)				(91,108	)		53,988
Interests received				12,857			7,223
Interests paid				(452,179	)		(181,038	)

Net cash provided by (used in) operating activities			W	(1,692,025	)		1,332,783

See accompanying notes to the condensed separate interim financial statements.

107

LG DISPLAY CO., LTD.

Condensed Separate Interim Statements of Cash Flows, Continued

(Unaudited)

For the nine-month periods ended September 30, 2023 and 2022


(In millions of won)	Note		2023			2022
Cash flows from investing activities:
Dividends received			W	1,887,196			126,553
Increase in deposits in banks				(20,000	)		(42,804	)
Proceeds from withdrawal of deposits in banks				42,804			76,913
Acquisition of financial asset at fair value through profit or loss				—			(150	)
Acquisition of financial assets at fair value through other comprehensive income				(1,000	)		(1,721	)
Proceeds from disposal of financial assets at fair value through other comprehensive income				891			1,628
Acquisition of investments				(223,991	)		(30,311	)
Proceeds from disposal of investments				—			132,200
Acquisition of property, plant and equipment				(1,754,721	)		(2,871,319	)
Proceeds from disposal of property, plant and equipment				371,030			73,469
Acquisition of intangible assets				(488,948	)		(553,418	)
Proceeds from disposal of intangible assets				5,933			10,446
Proceeds from settlement of derivatives				127,833			19,378
Proceeds from collection of short-term loans				23,402			6,156
Increase in short-term loans				—			(9,643	)
Increase in long-term loans				—			(49,756	)
Increase in deposits				(5	)		(731	)
Decrease in deposits				92			3,981
Proceeds from disposal of other assets				6,659			1,464

Net cash used in investing activities				(22,825	)		(3,107,665	)

Cash flows from financing activities:		26
Proceeds from short-term borrowings				4,629,907			1,897,280
Repayments of short-term borrowings				(4,490,582	)		(220,000	)
Proceeds from issuance of bonds				469,266			443,230
Proceeds from long-term borrowings				2,647,189			1,338,723
Repayment of current portion of long-term borrowings and bonds				(2,078,296	)		(2,310,478	)
Payment guarantee fee received				5,149			3,403
Payment guarantee fee paid				(1,726	)		—
Dividends paid				—			(232,580	)
Repayments of lease liabilities				(9,685	)		(10,013	)

Net cash provided by financing activities				1,171,222			909,565

Net decrease in cash and cash equivalents				(543,628	)		(865,317	)
Cash and cash equivalents at January 1				692,312			950,847

Cash and cash equivalents at September 30			W	148,684			85,530

See accompanying notes to the condensed separate interim financial statements.

108

LG DISPLAY CO., LTD. AND SUBSIDIARIES

Notes to the Condensed Consolidated Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

1.	Organization and Description of Business

LG Display Co., Ltd. (the “Company”) was incorporated in February 1985 and the Company is a public corporation listed in the Korea Exchange since 2004. The main business of the Company is to manufacture and sell displays and its related products. As of September 30, 2023, the Company is operating Thin Film Transistor Liquid Crystal Display (“TFT-LCD”) and Organic Light Emitting Diode (“OLED”) panel manufacturing plants in Gumi, Paju and China and TFT-LCD and OLED module manufacturing plants in Gumi, Paju, China and Vietnam. The Company is domiciled in the Republic of Korea with its address at 128 Yeouidae-ro, Yeongdeungpo-gu, Seoul, the Republic of Korea. As of September 30, 2023, LG Electronics Inc., a major shareholder of the Company, owns 37.9% (135,625,000 shares) of the Company’s common stock.

The Company’s common stock is listed on the Korea Exchange under the identifying code 034220. As of September 30, 2023, there are 357,815,700 shares of common stock outstanding. The Company’s common stock is also listed on the New York Stock Exchange in the form of American Depository Shares (“ADSs”) under the symbol “LPL”. One ADS represents one-half of one share of common stock. As of September 30, 2023, there are 18,642,878 ADSs outstanding.

2.	Basis of Presenting Financial Statements

(a)

Statement of Compliance

The condensed separate interim financial statements have been prepared in accordance with Korean International Financial Reporting Standard (“K-IFRS”) No.1034, Interim Financial Reporting. They do not include all of the information required for full annual financial statements and should be read in conjunction with the separate financial statements of the Company as of and for the year ended December 31, 2022.

These condensed interim financial statements are separate interim financial statements prepared in accordance with K-IFRS No.1027, Separate Financial Statements, presented by a parent, an investor in an associate, in which the investments are accounted for on the basis of the direct equity interest rather than on the basis of the reported results and net assets of the investees.

(b)

Basis of Measurement

The condensed separate interim financial statements have been prepared on the historical cost basis except for the following material items in the statement of financial position:

•

net defined benefit liabilities (defined benefit assets) recognized at the present value of defined benefit obligations less the fair value of plan assets

109

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

2.	Basis of Presenting Financial Statements, Continued

(c)

Functional and Presentation Currency

The condensed separate interim financial statements are presented in Korean won, which is the Company’s functional currency.

(d)

Use of Estimates and Judgments

The preparation of the condensed separate interim financial statements in conformity with K-IFRSs requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

3.	Accounting Policies

The accounting policies followed by the Company in the preparation of its condensed separate interim financial statements are the same as those followed by the Company in its preparation of the separate financial statements as of and for the year ended December 31, 2022, except for the application of K-IFRS No. 1034, Interim Financial Reporting.

4.	Cash and Cash Equivalents and Deposits in Banks

Cash and cash equivalents and deposits in banks as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Current assets
Cash and cash equivalents
Deposits	W	148,684		692,312
Deposits in banks
Restricted Deposits (*)	W	20,000		42,804
Non-current assets
Deposits in banks
Restricted deposits (*)	W	11		11

(*) Includes funds deposited under agreements on mutually beneficial cooperation to aid LG Group companies’ suppliers.

110

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

5.	Trade Accounts and Notes Receivable, Other Accounts Receivable and Others

(a)

Trade accounts and notes receivable as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Due from third parties	W	160,775		173,644
Due from related parties		2,460,207		2,302,276

	W	2,620,982		2,475,920

(b)

Other accounts receivable as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Current assets
Non-trade receivables, net	W	73,915		133,991
Accrued income		92		1,125

	W	74,007		135,116

Non-current assets
Long-term non-trade receivables	W	16,121		13,364

	W	90,128		148,480

Due from related parties included in other accounts receivable as of September 30, 2023 and December 31, 2022 are W39,564 million and W51,948 million, respectively.

(c)

The aging of trade accounts and notes receivable and other accounts receivable as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023
	Book value				Allowance for impairment
(In millions of won)	Trade accounts and notes receivable		Other accounts receivable		Trade accounts and notes receivable			Other accounts receivable
Current	W	2,613,544		88,922		(158	)		(1,386	)
1-15 days past due		1,703		639		—			(6	)
16-30 days past due		3,586		121		—			(1	)
31-60 days past due		—		504		—			(5	)
More than 60 days past due		2,328		1,349		(21	)		(9	)

	W	2,621,161		91,535		(179	)		(1,407	)

111

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

5.	Trade Accounts and Notes Receivable, Other Accounts Receivable and Others, Continued


	December 31, 2022
	Book value				Allowance for impairment
(In millions of won)	Trade accounts and notes receivable		Other accounts receivable		Trade accounts and notes receivable			Other accounts receivable
Current	W	2,462,872		144,950		(200	)		(1,362	)
1-15 days past due		922		933		—			(9	)
16-30 days past due		—		—		—			—
31-60 days past due		—		79		—			—
More than 60 days past due		12,355		3,936		(29	)		(47	)

	W	2,476,149		149,898		(229	)		(1,418	)


	2023						2022
(In millions of won)	Trade accounts and notes receivable			Other accounts receivable			Trade accounts and notes receivable		Other accounts receivable
Balance at the beginning of the period	W	229			1,418			11		1,496
(Reversal of) bad debt expense		(50	)		(11	)		25		—

Balance at the end of the reporting period	W	179			1,407			36		1,496

(d)

Other current assets as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Advanced payments	W	1,351		21,658
Prepaid expenses		126,587		51,822
Value added tax refundable		75,450		124,225
Right to recover returned goods		5,091		8,155

	W	208,479		205,860

112

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

6.	Other Financial Assets

Other financial assets as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Current assets
Financial assets at fair value through profit or loss
Derivatives(*1)	W	227,197		119,417
Fair value hedging derivatives
Derivatives(*2)	W	10,332		—
Financial assets carried at amortized cost
Short-term loans	W	24,208		30,062

	W	261,737		149,479

Non-current assets
Financial assets at fair value through profit or loss
Equity instruments	W	2,708		10,484
Convertible securities		1,797		1,797
Derivatives(*1)		67,635		110,663

	W	72,140		122,944

Fair value hedging derivatives
Derivatives(*2)	W	9,682		—

Financial assets carried at amortized cost
Deposits	W	8,230		8,317
Long-term loans		41,691		58,806

	W	49,921		67,123

	W	131,743		190,067

(*1) Represents cross currency interest rate swap contracts and others entered into by the Company to hedge currency and interest rate risks with respect to foreign currency denominated borrowings and bonds. The contracts are not designated as hedging instruments.

(*2) Represents forward exchange contracts entered into by the Company to hedge exchange rate risks with respect to advances received in foreign currency. The contracts are designated as hedging instruments.

113

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

7.	Inventories

Inventories as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Finished goods	W	368,056		215,526
Work-in-process		1,289,615		1,049,489
Raw materials		572,414		578,704
Supplies		89,806		80,875

	W	2,319,891		1,924,594

For the nine-month periods ended September 30, 2023 and 2022, the amount of inventories recognized as cost of sales and inventory write-downs included in cost of sales are as follows:


(In millions of won)	2023		2022
Inventories recognized as cost of sales	W	14,946,610		17,941,397
Including: inventory write-downs		197,753		210,801

There were no significant reversals of inventory write-downs recognized during the nine-month periods ended September 30, 2023 and 2022.

114

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

8.	Investments

(a)

Investments in subsidiaries consist of the following:


(In millions of won)					September 30, 2023					December 31, 2022
Subsidiaries	Location		Business		Percentage of ownership			Book Value		Percentage of ownership			Book Value
LG Display America, Inc.		San Jose, U.S.A.		Sell display products		100	%	W	36,815		100	%	W	36,815
LG Display Germany GmbH		Eschborn, Germany		Sell display products		100	%		19,373		100	%		19,373
LG Display Japan Co., Ltd.		Tokyo, Japan		Sell display products		100	%		15,686		100	%		15,686
LG Display Taiwan Co., Ltd.		Taipei, Taiwan		Sell display products		100	%		35,230		100	%		35,230
LG Display Nanjing Co., Ltd.		Nanjing, China		Manufacture display products		100	%		593,726		100	%		593,726
LG Display Shanghai Co., Ltd.		Shanghai, China		Sell display products		100	%		9,093		100	%		9,093
LG Display Guangzhou Co., Ltd.		Guangzhou, China		Manufacture display products		100	%		293,557		100	%		293,557
LG Display Shenzhen Co., Ltd.		Shenzhen, China		Sell display products		100	%		3,467		100	%		3,467
LG Display Singapore Pte. Ltd.		Singapore		Sell display products		100	%		1,250		100	%		1,250
L&T Display Technology (Fujian) Limited		Fujian, China		Manufacture and sell LCD module and LCD monitor sets		51	%		10,123		51	%		10,123
LG Display Yantai Co., Ltd.		Yantai, China		Manufacture display products		100	%		169,195		100	%		169,195
Nanumnuri Co., Ltd.		Gumi, South Korea		Provide janitorial services		100	%		800		100	%		800
LG Display (China) Co., Ltd.		Guangzhou, China		Manufacture and sell display products		51	%		723,086		51	%		723,086
Unified Innovative Technology, LLC		Wilmington, U.S.A.		Manage intellectual property		100	%		9,489		100	%		9,489
LG Display Guangzhou Trading Co., Ltd.		Guangzhou, China		Sell display products		100	%		218		100	%		218
Global OLED Technology, LLC		Sterling, U.S.A		Manage OLED intellectual property		100	%		164,322		100	%		164,322
LG Display Vietnam Haiphong Co., Ltd.		Haiphong, Vietnam		Manufacture and sell display products		100	%		672,658		100	%		672,658
Suzhou Lehui Display Co., Ltd.		Suzhou, China		Manufacture and sell LCD module and LCD monitor sets		100	%		121,640		100	%		121,640
LG DISPLAY FUND I LLC(*)		Wilmington, U.S.A		Invest in venture business and acquire technologies		100	%		89,957		100	%		85,266
LG Display High-Tech (China) Co., Ltd.		Guangzhou, China		Manufacture and sell display products		69	%		1,794,547		69	%		1,794,547
MMT(Money Market Trust)		Seoul, South Korea		Money market trust		100	%		219,300		—			—

								W	4,983,532				W	4,759,541

115

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

8.	Investments, Continued

(*)

For the nine-month period ended September 30, 2023, the Company contributed W4,691 million in cash for the capital increase of LG DISPLAY FUND I LLC. There was no change in the Company’s ownership percentage of ownership in LG DISPLAY FUND I LLC as a result of this additional investment.

(b)

Investments in associates consist of the following:


(In millions of won)			September 30, 2023					December 31, 2022
Associates	Location	Business	Percentage of ownership			Book Value		Percentage of ownership			Book Value
Paju Electric Glass Co., Ltd.	Paju, South Korea	Manufacture glass for display		40	%	W	45,089		40	%	W	45,089
WooRee E&L Co., Ltd.	Ansan, South Korea	Manufacture LED back light unit packages		13	%		11,424		13	%		11,424
YAS Co., Ltd.	Paju, South Korea	Develop and manufacture deposition equipment for OLEDs		15	%		10,000		15	%		10,000
AVATEC Co., Ltd.	Daegu, South Korea	Process and sell glass for display		14	%		8,000		14	%		8,000
Arctic Sentinel, Inc.	Los Angeles, U.S.A.	Develop and manufacture tablet for kids		10	%		—		10	%		—
Cynora GmbH	Bruchsal Germany	Develop organic emitting materials for displays and lighting devices		10	%		—		11	%		—
Material Science Co., Ltd.	Seoul, South Korea	Develop, manufacture and sell materials for display		10	%		3,650		10	%		3,650

						W	78,163				W	78,163

Dividends income recognized from subsidiaries and associates for the nine-month periods ended September 30, 2023 and 2022 amounted to W1,887,196 million and W122,303 million, respectively.

116

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

9.	Property, Plant and Equipment

For the nine-month periods ended September 30, 2023 and 2022, the Company purchased property, plant and equipment of W1,584,916 million and W3,487,252 million, respectively. The capitalized borrowing costs and the annualized capitalization rate were W180,955 million and 4.91%, and W97,680 million and 3.03%, for the nine-month periods ended September 30, 2023 and 2022, respectively. Also, for the nine-month periods ended September 30, 2023 and 2022, the Company disposed of property, plant and equipment with carrying amounts of W418,617 million and W93,662 million, respectively, and recognized W28,089 million and W77,295 million, respectively, as gain and loss on disposal of property, plant and equipment for the nine-month period ended September 30, 2023 (gain and loss on disposal of property, plant and equipment for the nine-month period ended September 30, 2022: W14,063 million and W35,801 million, respectively).

10.	Intangible Assets

The Company capitalizes expenditures related to development activities, such as expenditures incurred on designing, manufacturing and testing of products after those related activities meet the capitalization criteria of development costs including technical feasibility, future economic benefits and others. The balances of capitalized development costs as of September 30, 2023 and December 31, 2022, are W634,837 million and W565,219 million, respectively. For the nine-month periods ended September 30, 2023 and 2022, the Company recognized an impairment loss amounting to W49,108 million and W11,273 million, respectively, in connection with development projects.

11.	Investment Property

(a)

Changes in investment property for the nine-month period ended September 30, 2023 are as follows:


(In millions of won)	2023
Book value as of January 1, 2023	W	28,269
Transfer from property, plant and equipment		9,928
Depreciation		(3,690	)
Others		(228	)

Book value as of September 30, 2023	W	34,279

(b)

During the nine-month period ended September 30, 2023, rental income from investment property is W3,704 million.

117

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

12.	Financial Liabilities

(a)

Financial liabilities as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Current
Short-term borrowings	W	2,121,498		1,952,289
Current portion of long-term borrowings and bonds		1,881,334		2,038,338
Current portion of payment guarantee liabilities		7,344		5,877
Derivatives(*1)		6,142		14,443
Lease liabilities		5,405		3,099

	W	4,021,723		4,014,046

Non-current
Won denominated borrowings	W	3,844,063		1,644,602
Foreign currency denominated borrowings		1,468,797		2,293,813
Bonds		1,123,612		1,132,098
Payment guarantee liabilities		16,121		13,364
Derivatives(*1)		11,525		32,965
Fair value hedging derivatives(*2)		2,609		—
Lease liabilities		3,184		2,853

	W	6,469,911		5,119,695

(b)

Short-term borrowings as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won ,USD and CNY) Lender	Annual interest rate as of September 30, 2023(%)	September 30, 2023		December 31, 2022
Standard Chartered Bank Korea Limited and others	3.50~6.95	W	2,121,498		1,952,289
Foreign currency equivalent		USD	450	USD	901
		CNY	345		—

118

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

12.	Financial Liabilities, Continued

(c)

Won denominated long-term borrowings as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)
Lender	Annual interest rate as of September 30, 2023 (%)		September 30, 2023			December 31, 2022
LG Electronics Inc.		6.06	W	1,000,000			—
Korea Development Bank and others		1.90~7.50		3,316,938			2,986,102
Less current portion of long-term borrowings				(472,875	)		(1,341,500	)

			W	3,844,063			1,644,602

(d)

Foreign currency denominated long-term borrowings as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won and USD)
Lender	Annual interest rate as of September 30, 2023 (%)		September 30, 2023			December 31, 2022
KEB Hana Bank and others		1.82~8.50	W	2,507,655			2,674,003
Foreign currency equivalent			USD	1,865		USD	2,110
Less current portion of long-term borrowings				(1,038,858	)		(380,190	)

			W	1,468,797			2,293,813

119

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

12.	Financial Liabilities, Continued

(e)

Details of bonds issued and outstanding as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won and USD)	Maturity		Annual interest rate as of September 30, 2023(%)		September 30, 2023			December 31, 2022
*Won denominated bonds at amortized cost (1)**
Publicly issued bonds		February 2024~ February 2027		2.29~3.66	W	1,025,000			1,215,000
Privately issued bonds		January 2025~ January 2026		7.20~7.25		337,000			110,000
Less discount on bonds						(2,493	)		(2,927	)
Less current portion						(369,601	)		(189,975	)

					W	989,906			1,132,098

*Foreign currency denominated bonds at amortized cost (2)**
Privately issued bonds		April 2026		7.27	W	134,480			126,730
Foreign currency equivalent (contractual par amount)					USD	100		USD	100
Less discount on bonds						(774	)		(57	)
Foreign currency equivalent (less discount on bonds)					USD	(1	)	USD	(0	)
Less current portion						—			(126,673	)

					W	133,706			—

					W	1,123,612			1,132,098

(*1) Principal of the won denominated bonds is to be repaid at maturity and interests are paid quarterly.

(*2) Principal of the foreign currency denominated bonds is to be repaid at maturity and interests are paid quarterly.

120

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

13.	Employee Benefits

The Company’s defined benefit plans provide a lump-sum payment to an employee based on final salary rates and length of service at the time the employee leaves the Company.

(a)

Net defined benefit liabilities (defined benefit assets) recognized as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023			December 31, 2022
Present value of partially funded defined benefit obligations	W	1,556,990			1,595,629
Fair value of plan assets		(1,923,487	)		(2,043,150	)

	W	(366,497	)		(447,521	)

(b)

Expenses related to defined benefit plans recognized in profit or loss for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30						For the nine-month periods ended September 30
(In millions of won)	2023			2022			2023			2022
Current service cost	W	42,870			42,937			128,610			131,903
Net interest cost		(5,985	)		(1,318	)		(17,957	)		(2,380	)

	W	36,885			41,619			110,653			129,523

(c)

Plan assets as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Guaranteed deposits in banks	W	1,923,487		2,043,150

As of September 30, 2023, the Company maintains the plan assets primarily with Mirae Asset Securities Co., Ltd., KB Insurance Co., Ltd. and others.

(d)


	For the three-month periods ended September 30						For the nine-month periods ended September 30
(In millions of won)	2023			2022			2023			2022
Remeasurements of net defined benefit liabilities	W	60			(6,718	)		(952	)		194,367
Tax effect		(14	)		1,758			215			(50,846	)

Remeasurements of net defined benefit liabilities, net of income tax	W	46			(4,960	)		(737	)		143,521

121

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

14.	Provisions

Changes in provisions for the nine-month periods ended September 30, 2023 and 2022 are as follows:


(In millions of won)	Litigation and claims		*Warranties ()**			Others			Total
Balance at January 1, 2023	W	1,680		248,137			8,432			258,249
Additions (reversal)		118		31,279			(3,123	)		28,274
Usage		—		(96,337	)		—			(96,337	)

Balance at September 30, 2023	W	1,798		183,079			5,309			190,186

Current	W	1,798		117,568			5,309			124,675
Non-current	W	—		65,511			—			65,511


(In millions of won)	Litigation and claims		*Warranties ()**			Others			Total
Balance at January 1, 2022	W	—		255,560			9,247			264,807
Additions (reversal)		1,758		147,979			(737	)		149,000
Usage		—		(156,291	)		—			(156,291	)

Balance at September 30, 2022	W	1,758		247,248			8,510			257,516

Current	W	1,758		160,065			8,510			170,333
Non-current	W	—		87,183			—			87,183

(*) Product warranties on defective products are normally applicable for warranty periods from the date of customer’s purchase. The provision is calculated by using historical and anticipated rates of warranty claims and costs per claim to satisfy the Company’s warranty obligation.

122

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

15.	Contingent Liabilities and Commitments

(a)

Legal Proceedings

Anti-trust litigations

Certain individual plaintiffs have filed “follow-on” damages claims against the Company and other TFT-LCD manufacturers alleging violations of EU competition law. While the Company continues to vigorously defend the various pending actions described above, as of September 30, 2023, the Company is unable to reliably estimate the timing and amount of outflows of resources embodying economic benefits relating to these actions.

Others

In addition to matters describes above, the Company is involved in various legal proceedings and litigation. The Company is unable to reliably estimate the timing and amount of outflows of resources embodying economic benefits relating to these matters.

(b)

Commitments

Factoring and securitization of accounts receivable

The Company has agreements with Korea Development Bank and several other banks for accounts receivable sales negotiating facilities of up to an aggregate of USD 1,000 million (W1,344,800 million) in connection with the Company’s export sales transactions with its subsidiaries. As of September 30, 2023, there are no short-term borrowings that are outstanding but past due in connection with these agreements. In connection with all of the contracts in this paragraph, the Company has sold its accounts receivable with recourse.

The Company has a credit facility agreement with Shinhan Bank and several other banks pursuant to which the Company could sell its accounts receivables up to an aggregate of W342,924 million in connection with its domestic and export sales transactions and, as of September 30, 2023, W38,810 million accounts and notes receivable sold were outstanding in connection with the agreement. In connection with the contracts above, the Company has sold its accounts receivable without recourse.

123

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

15.	Contingent Liabilities and Commitments, Continued

Letters of credit

As of September 30, 2023, the Company entered into agreements with financial institutions in relation to the opening of letters of credit and the respective credit limits under the agreements are as follows:


(In millions of won, USD)	Contractual amount		KRW equivalent
KEB Hana Bank	USD	650	W	874,120
Industrial Bank of Korea	USD	450		605,160
Industrial and Commercial Bank of China	USD	200		268,960
Shinhan Bank	USD	150		201,720
KB Kookmin Bank	USD	700		941,360
MUFG Bank	USD	100		134,480
The Export–Import Bank of Korea	USD	100		134,480

	USD	2,350	W	3,160,280

Payment guarantees

The Company provides payment guarantees to LG Display Vietnam Haiphong Co., Ltd. in connection with the principal amount of term loan credit facilities amounting to USD 1,532 million (W2,060,532 million).

In addition, the Company obtained payment guarantees amounting to USD 1,200 million (W1,613,760 million) from KB Kookmin Bank and others for advances received related to the long-term supply agreements.

License agreements

As of September 30, 2023, the Company has technical license agreements with Hitachi Display, Ltd. and others in relation to its LCD business and patent license agreement with Universal Display Corporation and others in relation to its OLED business. Also, the Company has a trademark license agreement with LG Corp. and other intellectual property license agreements with various companies as of September 30, 2023.

Long-term supply agreement

As of September 30, 2023, in connection with long-term supply agreements with customers, the Company recognized USD 1,200 million (W1,613,760 million) in advances received. The advances received will be used to offset accounts receivable arising from future product sales after a specified period of time. The Company received payment guarantees amounting to USD 1,200 million (W1,613,760 million) from KB Kookmin Bank and other various banks relating to advances received (see note 15(b)).

Pledged Assets

In connection with the borrowings amounting to W1,000,000 million from related party, as of September 30, 2023, the Company has provided its property, plant and equipment with carrying amount of W524,643 million as pledged assets (see note 12(c)).

124

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

15.	Contingent Liabilities and Commitments, Continued

In connection with the borrowing amounting to W272,000 million from Korea Development Bank and others as of September 30, 2023, the Company has provided its property, plant and equipment with carrying amount of W97,053 million as pledged assets

In connection with the borrowing amounting to USD 200 million (W 268,960 million) and W450,000 million from Shinhan Bank and others as of September 30, 2023, the Company is provided pledged assets as deposits in banks and others amounting to CNY 4,288 million (W 790,102 million) from LG Display Nanjing Co., Ltd.

Commitments for asset acquisition

The Company’s commitments in relation to capital expenditures on property, plant and equipment and intangible assets as of September 30, 2023 are W532,936 million.

16.	Share Capital and Share Premium

The Company is authorized to issue 500,000,000 shares of capital stock (par value W5,000), and as of September 30, 2023 and December 31, 2022, the number of issued common shares is 357,815,700. There have been no changes in the capital stock from January 1, 2022 to September 30, 2023.

The Company’s capital surplus consists of share premium. There have been no changes in share premium from January 1, 2022 to September 30, 2023.

17.

Revenue

Details of revenue for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30					For the nine-month periods ended September 30
(In millions of won)	2023		2022			2023		2022
Sales of goods	W	4,675,613		6,261,577			12,922,420		17,835,753
Royalties		3,071		2,319			10,251		7,380
Others		10,003		4,998			27,367		13,466
Hedging loss		—		(83,371	)		—		(152,656	)

	W	4,688,687		6,185,523			12,960,038		17,703,943

125

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

18.	The Nature of Expenses and Others

The classification of expenses by nature for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30					For the nine-month periods ended September 30
(In millions of won)	2023			2022		2023			2022
Changes in inventories	W	(450,081	)		209,266		(395,297	)		(710,221	)
Purchases of raw materials, merchandise and others		1,752,745			2,134,370		4,672,423			5,916,474
Depreciation and amortization		581,819			574,713		1,659,876			1,797,931
Outsourcing		2,005,430			2,754,166		6,608,073			8,278,454
Labor		622,503			654,753		1,877,808			1,934,459
Supplies and others		179,516			220,402		506,781			652,116
Utility		232,533			209,334		645,890			585,647
Fees and commissions		94,065			139,990		298,608			399,216
Shipping		11,364			15,776		29,750			43,277
Advertising		17,731			28,545		53,114			84,528
Warranty		8,345			45,167		31,279			147,979
Travel		16,041			17,214		41,707			43,540
Taxes and dues		15,073			17,611		48,565			55,683
Others		245,411			232,687		694,574			596,745

	W	5,332,495			7,253,994		16,773,151			19,825,828

Total expenses consist of cost of sales, selling, administrative, research and development expenses and other non-operating expenses, excluding foreign exchange differences.

126

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

19.	Selling and Administrative Expenses

Details of selling and administrative expenses for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Salaries	W	56,568		60,654		180,424		176,521
Expenses related to defined benefit plans		5,569		6,333		17,105		19,477
Other employee benefits		11,973		14,635		38,669		40,716
Shipping		6,679		7,761		15,258		21,005
Fees and commissions		39,074		67,254		124,143		178,352
Depreciation		37,554		29,634		115,453		89,248
Taxes and dues		1,268		873		4,636		3,000
Advertising		17,731		28,545		53,114		84,528
Warranty		8,345		45,167		31,279		147,979
Insurance		2,415		2,367		7,179		6,482
Travel		3,309		3,902		9,906		9,889
Training		1,740		4,423		7,307		9,918
Others		15,083		23,405		43,071		58,488

	W	207,308		294,953		647,544		845,603

20.	Personnel Expenses

Details of personnel expenses for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Salaries and wages	W	541,223		557,553		1,640,478		1,651,685
Other employee benefits		83,820		88,916		259,688		242,292
Contributions to National Pension plan		21,181		20,082		59,790		56,325
Expenses related to defined benefit plans and defined contribution plans		39,054		41,992		116,602		130,484

	W	685,278		708,543		2,076,558		2,080,786

127

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

21.	Other Non-operating Income and Other Non-operating Expenses

(a)

Details of other non-operating income for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Foreign currency gain	W	195,246		761,453		624,308		1,455,455
Gain on disposal of property, plant and equipment		5,489		4,043		28,089		14,063
Gain on disposal of intangible assets		1,520		—		1,989		—
Reversal of impairment loss on intangible assets		120		—		242		5,571
Rental income		467		518		1,450		1,536
Others		5,267		15,082		6,774		37,795

	W	208,109		781,096		662,852		1,514,420

(b)

Details of other non-operating expenses for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Foreign currency loss	W	303,714		1,115,067		983,886		1,870,823
Loss on disposal of property, plant and equipment		22,737		11,524		77,295		35,801
Impairment loss on property, plant and equipment		1,812		—		6,760		3,351
Loss on disposal of intangible assets		—		7		55		163
Impairment loss on intangible assets		29,098		12,686		50,900		19,388
Others		982		1,053		11,588		4,630

	W	358,343		1,140,337		1,130,484		1,934,156

128

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

22.	Finance Income and Finance Costs

Finance income and costs recognized in profit or loss for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Finance income
Interest income	W	3,780		4,813		12,288		7,431
Dividend income		—		—		1,887,196		122,303
Foreign currency gain		2,872		32,825		54,362		55,602
Gain on transaction of derivatives		42,743		6,098		127,833		19,754
Gain on valuation of derivatives		48,053		383,839		295,896		600,752
Gain on valuation of financial assets at fair value through profit or loss		—		—		—		310
Gain on valuation of financial liabilities at fair value through profit or loss		—		2,967		—		220,355
Others		2,029		1,668		5,534		3,899

	W	99,477		432,210		2,383,109		1,030,406

Finance costs
Interest expense	W	125,890		50,642		296,102		126,774
Foreign currency loss		71,905		432,540		208,117		759,733
Loss on early repayment of borrowings and bonds		—		2,540		167		2,540
Loss on sale of trade accounts and notes receivable		344		196		574		287
Loss on valuation of financial assets at fair value through profit or loss		—		97		7,776		1,514
Loss on transaction of derivatives		—		38		—		376
Loss on valuation of derivatives		—		—		201,401		—
Others		2,828		1,725		6,453		1,769

	W	200,967		487,778		720,590		892,993

129

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

23.	Income Tax Expense (Benefit)

(a)

Details of income tax benefit for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30						For the nine-month periods ended September 30
(In millions of won)	2023			2022			2023			2022
Current tax expense (benefit)	W	6,275			49			90,536			(3,322	)
Deferred tax benefit		(205,864	)		(417,611	)		(972,166	)		(641,841	)

Income tax benefit	W	(199,589	)		(417,562	)		(881,630	)		(645,163	)

(b)

Deferred Tax Assets and Liabilities

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that the deferred tax assets at the reporting date will be realized with the Company’s estimated future taxable income. The Company’s deferred tax assets and liabilities may differ from actual refundable or payable amount.

Deferred tax assets and liabilities as of September 30, 2023 and December 31, 2022 are attributable to the following:


	Assets				Liabilities						Total
(In millions of won)	September 30, 2023		December 31, 2022		September 30, 2023			December 31, 2022			September 30, 2023			December 31, 2022
Other accounts receivable, net	W	—		—		(41	)		(2,009	)		(41	)		(2,009	)
Inventories, net		38,139		35,562		—			—			38,139			35,562
Defined benefit liabilities, net		—		—		(84,038	)		(95,850	)		(84,038	)		(95,850	)
Accrued expenses		96,186		106,398		—			—			96,186			106,398
Property, plant and equipment		393,742		420,455		—			—			393,742			420,455
Intangible assets		6,815		22,093		—			—			6,815			22,093
Provisions		42,030		57,210		—			—			42,030			57,210
Other temporary differences		37,318		23,881		(22,984	)		(26,008	)		14,334			(2,127	)
Tax losses carryforwards		2,699,585		1,700,860		—			—			2,699,585			1,700,860
Tax credit carryforwards		179,192		170,971		—			—			179,192			170,971

Deferred tax assets (liabilities)	W	3,493,007		2,537,430		(107,063	)		(123,867	)		3,385,944			2,413,563

130

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

24.	Loss Per Share

(a)

Basic loss per share for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30						For the nine-month periods ended September 30
(In won and number of shares)	2023			2022			2023			2022
Loss for the period	W	(641,314,725,624	)		(1,040,448,272,632	)		(1,589,998,414,082	)		(1,695,712,491,611	)
Weighted-average number of common stocks outstanding		357,815,700			357,815,700			357,815,700			357,815,700

Basic loss per share	W	(1,792	)		(2,908	)		(4,444	)		(4,739	)

(b)

Diluted loss per share is not different from basic loss per share as there is no dilution effect of potential common stocks for the three-month and nine-month periods ended September 30, 2023 and 2022.

131

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management

The Company is exposed to credit risk, liquidity risk and market risks. The Company identifies and analyzes such risks, and controls are implemented under a risk management system to monitor and manage these risks at below an acceptable level.

(a)

Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

(i)

Currency risk

The Company is exposed to currency risk on sales, purchases and borrowings that are denominated in a currency other than the functional currency of the Company, Korean won (KRW). The currencies in which these transactions primarily are denominated are USD, JPY, etc.

The Company adopts policies to ensure that its net exposure is kept to a manageable level by buying or selling foreign currencies at spot rates when necessary to address short-term imbalances. In respect of monetary assets and liabilities denominated in foreign currencies, the Company manages currency risk through continuously managing the position of foreign currencies, measuring the currency risk and, if necessary, using derivatives such as currency forwards, currency swap and others.

132

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

i) Exposure to currency risk

The Company’s exposure to foreign currency risk based on notional amounts as of September 30, 2023 and December 31, 2022 is as follows:


	September 30, 2023
(In millions)	USD			JPY			CNY			PLN		EUR
Cash and cash equivalents		233			—			—			1		—
Trade accounts and notes receivable		1,912			1			—			—		—
Other accounts receivables		36			315			—			—		—
Short-term loans		25			—			—			—		—
Trade accounts and notes payable		(4,876	)		(7,867	)		—			—		—
Other accounts payable		(506	)		(8,030	)		—			—		(1	)
Advances received		(1,200	)		—			—			—		—
Financial liabilities		(2,414	)		—			(345	)		—		—

		(6,790	)		(15,581	)		(345	)		1		(1	)

Cross currency interest rate swap contracts(*1)		2,065			—			345			—		—
Forward exchange contracts(*2)		1,200			—			—			—		—

Net exposure		(3,525	)		(15,581	)		—			1		(1	)

(*1) Of cross currency interest rate swap contracts, USD 500 million and CNY 345 million were entered into to hedge currency risk with respect to foreign currency denominated borrowings and USD 1,565 million were entered into to hedge currency risk and interest rate risk with respect to foreign currency denominated borrowings and bonds.

133

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued


	December 31, 2022
(In millions)	USD			JPY			CNY			PLN		EUR
Cash and cash equivalents		457			—			—			1		—
Trade accounts and notes receivable		1,906			217			—			—		—
Other accounts receivables		75			112			—			—		3
Short-term loans		30			—			—			—		—
Trade accounts and notes payable		(5,451	)		(4,041	)		—			—		—
Other accounts payable		(593	)		(18,611	)		(1	)		—		(6	)
Financial liabilities		(3,111	)		—			—			—		—

		(6,687	)		(22,323	)		(1	)		1		(3	)

Cross currency interest rate swap contracts(*)		2,430			—			—			—		—

Net exposure		(4,257	)		(22,323	)		(1	)		1		(3	)

(*) Of cross currency interest rate swap contracts, USD 700 million were entered into to hedge currency risk with respect to foreign currency denominated borrowings and USD 1,730 million were entered into to hedge currency risk and interest rate risk with respect to foreign currency denominated borrowings and bonds.

Average exchange rates applied for the nine-month periods ended September 30, 2023 and 2022 and the exchange rates at September 30, 2023 and December 31, 2022 are as follows:


	Average rate				Reporting date spot rate
(In won)	2023		2022		September 30, 2023		December 31, 2022
USD	W	1,300.93		1,267.30		1,344.80		1,267.30
JPY		9.44		9.92		9.02		9.53
CNY		184.86		191.75		184.27		181.44
PLN		307.80		288.55		308.46		288.70
EUR		1,409.67		1,347.18		1,421.72		1,351.20

134

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

ii) Sensitivity analysis

A weaker won, as indicated below, against the following currencies which comprise the Company’s assets or liabilities denominated in a foreign currency as of September 30, 2023 and December 31, 2022, would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis is based on foreign currency exchange rate variances that the Company considers to be reasonably possible at the end of the reporting period. The analysis assumes that all other variables, in particular interest rates, would remain constant. The changes in equity and profit or loss would have been as follows:


	September 30, 2023						December 31, 2022
(In millions of won)	Equity			Profit or loss			Equity			Profit or loss
USD (5 percent weakening)	W	(182,695	)		(182,695	)		(207,623	)		(207,623	)
JPY (5 percent weakening)		(5,417	)		(5,417	)		(8,189	)		(8,189	)
CNY (5 percent weakening)		(2	)		(2	)		(7	)		(7	)
PLN (5 percent weakening)		8			8			11			11
EUR (5 percent weakening)		(39	)		(39	)		(156	)		(156	)

iii) Fair value hedging derivatives

In relation to advances received that are denominated in foreign currencies, the Company uses derivative instruments to hedge change of fair value due to foreign currency exchange rate changes. As of September 30, 2023, there is no ineffective portion of the gain or loss on valuation of derivatives to which change of fair value hedging accounting has been applied and gain and loss on valuation amounting to W20,014 million and W2,609 million, respectively, (contracted buying amount: USD 1,200 million, contracted exchange rate: W1,289.11~1,310.08) are recognized in profit or loss.

135

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(ii) Interest rate risk

Interest rate risk arises principally from the Company’s variable interest-bearing bonds and borrowings. The Company establishes and applies its policy to reduce uncertainty arising from fluctuations in interest rates and to minimize finance cost and manages interest rate risk by monitoring of trends of fluctuations in interest rate and establishing plan for countermeasures. Meanwhile, the Company entered into cross currency interest rate swap contracts amounting to USD 1,565 million (W2,104,612 million) and interest rate swap contracts amounting to W990,000 million in notional amount to hedge interest rate risk with respect to variable interest bearing borrowings.

i) Profile

The interest rate profile of the Company’s interest-bearing financial instruments as of September 30, 2023 and December 31, 2022 is as follows:


(In millions of won)	September 30, 2023			December 31, 2022
Fixed rate instruments
Financial assets	W	168,684			735,116
Financial liabilities		(6,809,266	)		(5,843,924	)

	W	(6,640,582	)		(5,108,808	)

Variable rate instruments
Financial liabilities	W	(3,630,038	)		(3,217,216	)

ii) Equity and profit or loss sensitivity analysis for variable rate instruments


	Equity					Profit or loss
(In millions of won)	1%p increase			1%p decrease		1%p increase			1%p decrease
September 30, 2023
Variable rate instruments (*)	W	(4,633	)		4,633		(4,633	)		4,633
December 31, 2022
Variable rate instruments (*)	W	(4,270	)		4,270		(4,270	)		4,270

(*) Financial instruments related to non-hedging interest rate swap are excluded from the calculation.

136

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(iii) Managing interest rate benchmark reform and associated risks

In response to the IBOR interest rate reform, the company have completed the process of transitioning to an alternative benchmark rate. As of September 30, 2023, for the remaining IBORs, the interest rate benchmark will be changed from USD LIBOR to SOFR in the future, subject to the alternative provisions. The Company considers that a contract is not yet transitioned to an alternative benchmark rate when interest rate under the contract is indexed to a benchmark rate that is still subject to IBOR reform, even if it includes a fallback clause that deals with the cessation of the existing IBOR(“unreformed contracts”). As of September 30, 2023, the total amounts of unreformed contracts and those with appropriate fallback language are as follows:


(In millions of won)	Total amount of unreformed contracts		Amount with appropriate fallback clause
Non-derivative financial liabilities
Borrowings	W	134,480		134,480
Derivative assets
Cross currency interest rate swap contracts	W	198,533		198,533

137

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(b)

Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers.

The Company’s exposure to credit risk of trade and other receivables is influenced mainly by the individual characteristics of each customer. However, management believes that the default risk of the country in which each customer operates, do not have a significant influence on credit risk since the majority of the customers are global electronic appliance manufacturers operating in global markets.

The Company establishes credit limits for each customer and each new customer is analyzed quantitatively and qualitatively before determining whether to utilize third party guarantees, insurance or factoring as appropriate.

In relation to the impairment of financial assets subsequent to initial recognition, the Company recognizes the changes in expected credit loss (“ECL”) in profit or loss at each reporting date.

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk as of September 30, 2023 and December 31, 2022 are as follows:


(In millions of won)	September 30, 2023		December 31, 2022
Financial assets carried at amortized cost
Cash equivalents	W	148,684		692,312
Deposits in banks		20,011		42,815
Trade accounts and notes receivable, net		2,620,982		2,475,920
Non-trade receivables		73,915		133,991
Accrued income		92		1,125
Deposits		8,230		8,317
Short-term loans		24,208		30,062
Long-term loans		41,691		58,806
Long-term non-trade receivables		16,121		13,364

	W	2,953,934		3,456,712

Financial assets at fair value through profit or loss
Convertible securities	W	1,797		1,797
Derivatives		294,832		230,080

	W	296,629		231,877

Financial assets effective for fair value hedging
Derivatives	W	20,014		—

	W	3,270,577		3,688,589

In addition to the financial assets above, as of September 30, 2023, the Company provides payment guarantees in connection with the principal amount of credit facilities amounting to USD 1,532 million (W2,060,532 million) (see note 15).

138

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

Trade accounts and notes receivable are insured in order for the Company to manage credit risk if they do not meet the Company’s internal credit ratings. Uninsured trade accounts and notes receivable are managed by continuous monitoring of internal credit rating standards established by the Company and seeking insurance coverage, if necessary.

(c)

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or other financial assets. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.

The Company has historically been able to satisfy its cash requirements from cash flows from operations and debt and equity financing. To the extent that the Company does not generate sufficient cash flows from operations to meet its capital requirements, the Company may rely on other financing activities, such as long-term borrowings and offerings of debt instruments, equity-linked and other debt instruments. In addition, the Company maintains a line of credit with various banks.

The following are the contractual maturities of financial liabilities, including estimated interest payments, as of September 30, 2023 and December 31, 2022.


			September 30, 2023
			Contractual cash flows in
(In millions of won)	Carrying amount		Total		6 months or less		6-12 months		1-2 years		2-5 years		More than 5 years
Non-derivative financial liabilities
Borrowings	W	8,946,091		9,651,540		3,139,588		878,590		3,570,176		2,063,186		—
Bonds		1,493,213		1,620,134		111,850		320,858		651,268		536,158		—
Trade accounts and notes payable		8,616,252		8,616,252		8,414,264		201,988		—		—		—
Other accounts payable		1,343,277		1,345,427		1,288,932		56,495		—		—		—
Other accounts payable (enterprise procurement cards)(*1)		955,332		955,332		738,116		217,216		—		—		—
Long-term other accounts payable		394,935		457,267		—		—		119,715		196,348		141,204
Payment guarantee(*2)		23,465		2,400,449		231,501		159,599		520,857		1,144,481		344,011
Security deposits received		151,694		190,710		3,170		3,510		2,470		181,560		—
Lease liabilities		8,589		8,961		4,123		1,538		2,004		1,134		162

Derivative financial liabilities
Derivatives	W	17,667		7,555		399		5,017		934		1,205		—
Derivatives for fair value hedge		2,609		2,609		—		—		—		2,609		—

	W	21,953,124		25,256,236		13,931,943		1,844,811		4,867,424		4,126,681		485,377

139

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(*1)

Represents liabilities payable to credit card companies for purchase of raw materials and others paid using enterprise procurement cards. The Company presented the payable to credit card companies as other accounts payable and disclosed related cash flows as operating activities since the Company is using the enterprise procurement cards through agreements with suppliers for transactions arising from purchasing of goods and services, the payment term is within a year from the purchase, as part of the normal operating cycle, and no security is provided. Change in liabilities related to procurement cards for the nine-month period ended September 30, 2023 is as follows:

(In millions of won)

January 1, 2023

Change
(Cash flows from
operating activities)

September 30, 2023

Other accounts payable (enterprise procurement cards)

935,739

19,593

955,332

(*2)	Contractual cash flows of payment guarantee is identical to timing of principal and interest payment and represent the maximum amount that the Company could be required to pay the guarantee amount.

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.


			December 31, 2022
			Contractual cash flows in
(In millions of won)	Carrying amount		Total		6 months or less			6-12 months		1-2 years		2-5 years		More than 5 years
Non-derivative financial liabilities
Borrowings	W	7,612,394		8,114,753		3,237,943			693,026		2,073,216		2,110,568		—
Bonds		1,448,746		1,570,630		338,815			16,956		400,764		727,752		86,343
Trade accounts and notes payable		8,391,251		8,391,251		7,852,665			538,586		—		—		—
Other accounts payable		1,877,611		1,880,067		1,826,813			53,254		—		—		—
Other accounts payable (enterprise procurement cards)(*1)		935,739		935,739		935,739			—		—		—		—
Long-term other accounts payable		408,019		479,091		—			—		106,479		212,932		159,680
Payment guarantee(*2)		19,241		2,044,747		305,339			204,869		320,811		862,085		351,643
Security deposits received		146,773		191,720		—			2,260		8,450		181,010		—
Lease liabilities		5,952		6,320		1,807			1,488		1,899		704		422
Derivative financial liabilities
Derivatives	W	47,408		29,418		(1,637	)		10,741		3,024		17,290		—

	W	20,893,134		23,643,736		14,497,484			1,521,180		2,914,643		4,112,341		598,088

140

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(*1)

Represents liabilities payable to credit card companies for utility expenses and others paid using enterprise procurement cards. The Company presented the payable to credit card companies as other accounts payable and disclosed related cash flows as operating activities since the Company is using the enterprise procurement cards through agreements with suppliers for transactions arising from purchasing of goods and services, the payment term is within a year from the purchase, as part of the normal operating cycle, and no security is provided. Change in liabilities related to procurement cards for the year ended December 31, 2022 is as follows:


(In millions of won)	January 1, 2022		Change (Cash flows from operating activities)			December 31, 2022
Other accounts payable (enterprise procurement cards)	W	1,074,089		(138,350	)		935,739

(*2)	Contractual cash flows of payment guarantee is identical to timing of principal and interest payment and represent the maximum amount that the Company could be required to pay the guarantee amount.

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.

(d)

Capital management


(In millions of won)	September 30, 2023		December 31, 2022
Total liabilities	W	24,485,294		21,908,600
Total equity		5,759,704		7,350,439
Cash and deposits in banks (*1)		168,684		735,116
Borrowings (including bonds)		10,439,304		9,061,140
Total liabilities to equity ratio		425%		298%
Net borrowings to equity ratio (*2)		178%		113%

(*1) Cash and deposits in banks consist of cash and cash equivalents and current deposits in banks.

(*2) Net borrowings to equity ratio is calculated by dividing total borrowings (including bonds and excluding lease liabilities and others) less cash and current deposits in banks by total equity.

141

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(e)

Determination of fair value

(i)

Measurement of fair value

A number of the Company’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

Current assets and liabilities

The carrying amounts approximate their fair value because of the short maturity of these instruments.

ii)

Trade receivables and other receivables

iii)

Investments in equity and debt securities

iv)

Non-derivative financial liabilities

Derivatives

142

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(ii)

Fair values versus carrying amounts

The fair values of financial assets and liabilities, together with the carrying amounts shown in the condensed separate interim statements of financial position as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023				December 31, 2022
(In millions of won)	Carrying amounts		Fair values		Carrying amounts		Fair values
Financial assets carried at amortized cost
Cash and cash equivalents	W	148,684		(*)		692,312		(*)
Deposits in banks		20,011		(*)		42,815		(*)
Trade accounts and notes receivable		2,620,982		(*)		2,475,920		(*)
Non-trade receivables		73,915		(*)		133,991		(*)
Accrued income		92		(*)		1,125		(*)
Deposits		8,230		(*)		8,317		(*)
Short-term loans		24,208		(*)		30,062		(*)
Long-term loans		41,691		(*)		58,806		(*)
Long-term non-trade receivables		16,121		(*)		13,364		(*)
Financial assets at fair value through profit or loss
Equity instruments	W	2,708		2,708		10,484		10,484
Convertible securities		1,797		1,797		1,797		1,797
Derivatives		294,832		294,832		230,080		230,080
Financial assets effective for fair value hedging
Derivatives	W	20,014		20,014		—		—
Financial liabilities at fair value through profit or loss
Derivatives	W	17,667		17,667		47,408		47,408
Financial liabilities effective for fair value hedging
Derivatives	W	2,609		2,609		—		—
Financial liabilities carried at amortized cost
Borrowings	W	8,946,091		8,946,223		7,612,394		7,561,919
Bonds		1,493,213		1,470,144		1,448,746		1,377,696
Trade accounts and notes payable		8,616,252		(*)		8,391,251		(*)
Other accounts payable		2,298,609		(*)		2,813,350		(*)
Long-term other accounts payable		394,935		(*)		408,019		(*)
Payment guarantee liabilities		23,465		(*)		19,241		(*)
Security deposits received		151,694		(*)		146,773		(*)
Lease liabilities		8,589		(*)		5,952		(*)

(*) Excluded from disclosures as the carrying amount approximates fair value.

143

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(iii)

Fair values of financial assets and liabilities

i) Fair value hierarchy

•

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities

•

Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly

•

Level 3: inputs for the asset or liability that are not based on observable market data

ii) Financial instruments measured at fair value

Fair value hierarchy classifications of the financial instruments that are measured at fair value as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023
(In millions of won)	Level 1		Level 2		Level 3		Total
Financial assets at fair value through profit or loss
Equity instruments	W	—		—		2,708		2,708
Convertible securities		—		—		1,797		1,797
Derivatives		—		294,832		—		294,832
Financial assets effective for fair value hedging
Derivatives	W	—		20,014		—		20,014
Financial liabilities at fair value through profit or loss
Derivatives	W	—		17,667		—		17,667
Financial liabilities effective for fair value hedging
Derivatives	W	—		2,609		—		2,609

	December 31, 2022
(In millions of won)	Level 1		Level 2		Level 3		Total
Financial assets at fair value through profit or loss
Equity instruments	W	—		—		10,484		10,484
Convertible securities		—		—		1,797		1,797
Derivatives		—		230,080		—		230,080
Financial liabilities at fair value through profit or loss
Derivatives	W	—		47,408		—		47,408

144

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

iii)

Valuation techniques and inputs for Assets and Liabilities measured by the fair value hierarchy Level 2 and Level 3

Fair value hierarchy classifications, valuation technique and inputs for fair value measurements as of September 30, 2023 and December 31, 2022 are as follows:

(In millions of won)

September 30, 2023

Valuation
technique

Input

Classification

Level 1

Level 2

Level 3

Financial assets at fair value through profit or loss

Equity instruments

—

2,708

Discounted
cash flow, etc.

Discount rate and
Estimated cash
flow, etc.

Convertible securities

—

1,797

Blended discount
model and
binominal option
pricing model

Discount rate,
stock price and
volatility

Derivatives

—

294,832

—

Discounted

cash flow

Discount rate and
Exchange rate

Financial assets effective for fair value hedging

Derivatives

—

20,014

—

Discounted

cash flow

Discount rate and
Exchange rate

Financial liabilities at fair value through profit or loss

Derivatives

—

17,667

—

Discounted

cash flow

Discount rate and
Exchange rate

Financial liabilities effective for fair value hedging

Derivatives

—

2,609

—

Discounted

cash flow

Discount rate and
Exchange rate

145

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

(In millions of won)

December 31, 2022

Valuation
technique

Input

Classification

Level 1

Level 2

Level 3

Financial assets at fair value through profit or loss

Equity instruments

—

10,484

Discounted
cash flow, etc.

Discount rate
and Estimated
cash flow, etc.

Convertible securities

—

1,797

Blended
discount model
and binominal
option pricing
model

Discount rate,
stock price and
volatility

Derivatives

—

230,080

—

Discounted
cash flow

Discount rate and
Exchange rate

Financial liabilities at fair value through profit or loss

Derivatives

—

47,408

—

Discounted
cash flow

Discount rate and
Exchange rate

146

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

25.	Financial Risk Management, Continued

iv)

Financial instruments not measured at fair value but for which the fair value is disclosed

(In millions of won)

September 30, 2023

Valuation
technique

Input

Classification

Level 1

Level 2

Level 3

Liabilities

Borrowings

—

8,946,223

Discounted
cash flow

Discount
rate

Bonds

—

1,470,144

Discounted
cash flow

Discount
rate

(In millions of won)

December 31, 2022

Valuation
technique

Input

Classification

Level 1

Level 2

Level 3

Liabilities

Borrowings

—

7,561,919

Discounted
cash flow

Discount
rate

Bonds

—

1,377,696

Discounted
cash flow

Discount
rate

The interest rates applied for determination of the above fair value as of September 30, 2023 and December 31, 2022 are as follows:


	September 30, 2023	December 31, 2022
Borrowings, bonds and others	4.75~5.86%	5.11~6.68%

vi)

There were no transfer between Level 1, Level 2 and Level 3 for the nine-month periods ended September 30, 2023 and 2022 and the changes in financial assets classified as Level 3 of fair value measurements for the nine-month periods ended September 30, 2023 and 2022 are as follows:


(In millions of won)
Classification	January 1, 2023		Valuation			September 30, 2023
Equity instruments	W	10,484		(7,776	)		2,708
Convertible securities		1,797		—			1,797


(In millions of won)
Classification	January 1, 2022		Acquisition		Replacement		Valuation			September 30, 2022
Equity instruments	W	3,096		150		10,619		(1,204	)		12,661
Convertible securities		1,573		—		—		—			1,573

147

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Changes in liabilities arising from financing activities

Changes in liabilities arising from financing activities for the nine-month periods ended September 30, 2023 and 2022 are as follows:


						Non-cash transactions
(In millions of won)	January 1, 2023		Cash flows from financing activities			Reclassification			Gain or loss on foreign currency translation		Effective interest adjustment		Others		September 30, 2023
Short-term borrowings	W	1,952,289		139,325			—			29,884		—		—		2,121,498
Current portion of long-term borrowings and bonds		2,038,338		(2,078,296	)		1,842,140			78,821		164		167		1,881,334
Payment guarantee liabilities		19,241		3,423			—			—		—		801		23,465
Long-term borrowings		3,938,415		2,647,189			(1,362,788	)		84,669		2,508		2,867		5,312,860
Bonds		1,132,098		469,266			(479,352	)		488		1,112		—		1,123,612
Lease liabilities		5,952		(9,685	)		—			—		—		12,322		8,589

	W	9,086,333		1,171,222			—			193,862		3,784		16,157		10,471,358

148

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

26.	Changes in liabilities arising from financing activities, Continued


						Non-cash transactions
(In millions of won)	January 1, 2022		Cash flows from financing activities			Reclassification			Gain or loss on foreign currency translation		Effective interest adjustment		Others			September 30, 2022
Short-term borrowings	W	—		1,677,280			—			140,560		—		—			1,817,840
Current portion of long-term borrowings and bonds(*)		2,529,388		(2,310,478	)		1,885,210			200,965		11,433		(217,815	)		2,098,703
Payment guarantee liabilities		6,208		3,403			—			—		—		8,367			17,978
Long-term borrowings		4,034,735		1,338,723			(1,577,008	)		407,347		—		—			4,203,797
Bonds		995,976		443,230			(308,202	)		—		812		—			1,131,816
Lease liabilities		5,219		(10,013	)		—			13		—		13,667			8,886
Dividend payable		—		(232,580	)		—			—		—		232,580			—

	W	7,571,526		909,565			—			748,885		12,245		36,799			9,279,020

(*)	Others include W220,355 million of gain on valuation of financial liabilities at fair value through profit or loss and W2,540 million of loss on early repayment of borrowings and bonds.

149

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others

(a)

Related parties

Related parties as of September 30, 2023 are as follows:


Classification		Description
Subsidiaries(*)		LG Display America, Inc. and others
Associates(*)		Paju Electric Glass Co., Ltd. and others
Entity that has significant influence over the Company		LG Electronics Inc.
Subsidiaries of the entity that has significant influence over the Company		Subsidiaries of LG Electronics Inc.

(*)	Details of subsidiaries and associates are described in Note 8.

150

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued

(b)


	For the three-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries
LG Display America, Inc.	W	2,488,028		—		—		—		—		2
LG Display Japan Co., Ltd.		259,529		—		—		—		—		6
LG Display Germany GmbH		349,637		—		—		—		—		9,406
LG Display Taiwan Co., Ltd.		479,285		—		—		—		—		509
LG Display Nanjing Co., Ltd.		27,334		—		1,048		—		325,360		1,025
LG Display Shanghai Co., Ltd.		132,400		—		—		—		—		—
LG Display Guangzhou Co., Ltd.		4,034		—		11,216		—		280,224		4,774
LG Display Shenzhen Co., Ltd.		120,999		—		—		—		—		—
LG Display Yantai Co., Ltd.		882		—		5,694		—		157,924		77
LG Display (China) Co., Ltd.		620		—		179,623		—		—		455
LG Display Singapore Pte. Ltd.		322,136		—		—		—		—		14
L&T Display Technology (Fujian) Limited		32,645		—		—		—		—		31
Nanumnuri Co., Ltd.		59		—		—		—		—		5,858
LG Display Guangzhou Trading Co., Ltd.		100,159		—		—		—		—		—
LG Display Vietnam Haiphong Co., Ltd.		9,042		—		35,609		—		633,843		7,644
Suzhou Lehui Display Co., Ltd.		25,989		—		1,834		—		5,051		11
LG Display High-Tech (China) Co., Ltd.		307		—		1,356		—		401,682		1,427

	W	4,353,085		—		236,380		—		1,804,084		31,239

151

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates and their subsidiaries
WooRee E&L Co., Ltd.	W	—		—		72		—		—		9
AVATEC Co., Ltd.		—		—		250		—		10,857		2,934
Paju Electric Glass Co., Ltd.		—		—		47,722		—		—		1,334
YAS Co., Ltd.		—		—		2,335		276		—		1,071
Material Science Co., Ltd.		—		—		—		—		—		13

	W	—		—		50,379		276		10,857		5,361

Entity that has significant influence over the Company
LG Electronics Inc.	W	51,491		—		2,671		13,443		—		44,019
Subsidiaries of the entity that has significant influence over the Company
LG Electronics India Pvt. Ltd.	W	20,316		—		—		—		—		27
LG Electronics Vietnam Haiphong Co., Ltd.		81,457		—		—		—		—		172
LG Electronics Reynosa S.A. DE C.V.		7,942		—		—		—		—		128
LG Electronics U.S.A., Inc.		—		—		—		—		—		472
LG Electronics RUS, LLC		—		—		—		—		—		1,449

152

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries of the entity that has significant influence over the Company
LG Electronics Egypt S.A.E	W	4,052		—		—		—		—		7
LG Innotek Co., Ltd.		2,642		—		3		—		—		27,686
P.T. LG Electronics Indonesia		6,243		—		—		—		—		673
Others		6,749		—		—		—		—		4,210

	W	129,401		—		3		—		—		34,824

	W	4,533,977		—		289,433		13,719		1,814,941		115,443

153

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries
LG Display America, Inc.	W	7,215,441		—		—		—		—		6
LG Display Japan Co., Ltd.		674,238		—		—		—		—		241
LG Display Germany GmbH		855,486		—		—		—		—		43,724
LG Display Taiwan Co., Ltd.		1,180,187		—		—		—		—		1,239
LG Display Nanjing Co., Ltd.		78,547		425,666		3,430		—		1,126,388		11,240
LG Display Shanghai Co., Ltd.		357,115		—		—		—		—		—
LG Display Guangzhou Co., Ltd.		20,523		1,042,837		33,384		—		909,889		13,636
LG Display Shenzhen Co., Ltd.		272,449		—		—		—		—		—
LG Display Yantai Co., Ltd.		890		345,527		13,480		—		243,359		1,271
LG Display (China) Co., Ltd.		941		57,966		740,088		—		—		1,168
LG Display Singapore Pte. Ltd.		787,090		—		—		—		—		95
L&T Display Technology (Fujian) Limited		93,720		—		4		—		—		120
Nanumnuri Co., Ltd.		178		—		—		—		—		17,683
LG Display Guangzhou Trading Co., Ltd.		272,622		—		—		—		—		—
LG Display Vietnam Haiphong Co., Ltd.		20,449		—		73,162		—		1,818,271		22,292
Suzhou Lehui Display Co., Ltd.		66,272		—		16,405		—		19,491		28
LG Display High-Tech (China) Co., Ltd.		4,837		—		2,874		—		1,998,305		3,728

	W	11,900,985		1,871,996		882,827		—		6,115,703		116,471

154

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates and their subsidiaries
WooRee E&L Co., Ltd.	W	—		—		330		—		—		10
AVATEC Co., Ltd.		—		—		442		—		30,234		6,644
Paju Electric Glass Co., Ltd.		—		15,200		122,537		—		—		2,739
YAS Co., Ltd.		—		—		6,462		7,236		—		4,209
Material Science Co., Ltd.		—		—		—		—		—		72

	W	—		15,200		129,771		7,236		30,234		13,674

Entity that has significant influence over the Company
LG Electronics Inc.	W	151,970		—		9,074		41,787		—		114,477
Subsidiaries of the entity that has significant influence over the Company
LG Electronics India Pvt. Ltd.	W	42,703		—		—		—		—		163
LG Electronics Vietnam Haiphong Co., Ltd.		334,522		—		—		—		—		559
LG Electronics Reynosa S.A. DE C.V.		22,915		—		—		—		—		485
LG Electronics U.S.A., Inc.		—		—		—		—		—		1,606
LG Electronics RUS, LLC		—		—		—		—		—		2,062

155

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2023
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries of the entity that has significant influence over the Company
LG Electronics Egypt S.A.E	W	18,732		—		—		—		—		44
LG Innotek Co., Ltd.		5,828		—		17		—		—		77,164
P.T. LG Electronics Indonesia		20,119		—		—		—		—		1,842
Others		17,991		—		9		—		—		13,453

	W	462,810		—		26		—		—		97,378

	W	12,515,765		1,887,196		1,021,698		49,023		6,145,937		342,000

156

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2022
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries
LG Display America, Inc.	W	3,730,189		—		—		—		—		17
LG Display Japan Co., Ltd.		432,034		—		—		—		—		—
LG Display Germany GmbH		486,800		—		—		—		—		31,273
LG Display Taiwan Co., Ltd.		426,551		—		—		—		—		333
LG Display Nanjing Co., Ltd.		19,743		—		1,269		—		578,759		10,862
LG Display Shanghai Co., Ltd.		66,522		—		—		—		—		—
LG Display Guangzhou Co., Ltd.		4,007		—		20,116		—		380,731		7,034
LG Display Shenzhen Co., Ltd.		166,153		—		—		—		—		—
LG Display Yantai Co., Ltd.		3		—		6,890		—		164,298		628
LG Display (China) Co., Ltd.		406		—		426,178		—		—		734
LG Display Singapore Pte. Ltd.		303,837		—		—		—		—		69
L&T Display Technology (Fujian) Limited		45,309		—		—		—		—		89
Nanumnuri Co., Ltd.		56		—		—		—		—		5,702
LG Display Guangzhou Trading Co., Ltd.		101,532		—		—		—		—		—
LG Display Vietnam Haiphong Co., Ltd.		2,867		—		19,864		—		744,268		19,283
Suzhou Lehui Display Co., Ltd.		44,767		—		20,715		—		—		—
LG Display High-Tech (China) Co., Ltd.		659		—		2,196		—		639,159		819

	W	5,831,435		—		497,228		—		2,507,215		76,843

157

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2022
	Sales and others		Dividend income		Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates and their subsidiaries
WooRee E&L Co., Ltd.	W	—		—		108		—		—		—
AVATEC Co., Ltd.		—		—		—		—		17,324		1,245
Paju Electric Glass Co., Ltd.		—		—		47,187		—		—		798
YAS Co., Ltd.		—		—		2,400		5,930		—		2,408

	W	—		—		49,695		5,930		17,324		4,451

Entity that has significant influence over the Company
LG Electronics Inc.	W	60,300		—		3,164		116,801		—		29,923
Subsidiaries of the entity that has significant influence over the Company
LG Electronics India Pvt. Ltd.	W	31,204		—		—		—		—		101
LG Electronics Vietnam Haiphong Co., Ltd.		139,145		—		—		—		—		112
LG Electronics Reynosa S.A. DE C.V.		7,935		—		—		—		—		296
LG Electronics U.S.A., Inc.		—		—		—		—		—		581
LG Electronics RUS, LLC		—		—		—		—		—		16

158

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2022
	Sales and others		Dividend income		Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries of the entity that has significant influence over the Company
LG Electronics Egypt S.A.E	W	28,220		—		—		—		—		179
LG Innotek Co., Ltd.		1,816		—		2		—		—		18,689
P.T. LG Electronics Indonesia		6,529		—		—		—		—		227
Others		6,420		—		36		—		—		6,538

	W	221,269		—		38		—		—		26,739

	W	6,113,004		—		550,125		122,731		2,524,539		137,956

159

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2022
	Sales and others				Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries
LG Display America, Inc.	W	8,717,354		—		—		—		—		28
LG Display Japan Co., Ltd.		1,439,952		—		—		—		—		—
LG Display Germany GmbH		1,339,032		—		—		—		—		65,232
LG Display Taiwan Co., Ltd.		1,635,727		—		—		—		—		1,148
LG Display Nanjing Co., Ltd.		46,124		—		2,774		—		1,329,714		20,361
LG Display Shanghai Co., Ltd.		340,454		—		—		—		—		3
LG Display Guangzhou Co., Ltd.		9,864		—		48,281		—		1,773,825		16,297
LG Display Shenzhen Co., Ltd.		610,036		—		—		—		—		—
LG Display Yantai Co., Ltd.		13		—		16,102		—		362,205		2,716
LG Display (China) Co., Ltd.		834		115,842		1,227,842		—		—		1,436
LG Display Singapore Pte. Ltd.		1,563,004		—		—		—		—		398
L&T Display Technology (Fujian) Limited		187,638		—		—		—		—		361
Nanumnuri Co., Ltd.		169		2,000		—		—		—		19,746
LG Display Guangzhou Trading Co., Ltd.		416,659		—		—		—		—		—
LG Display Vietnam Haiphong Co., Ltd.		8,986		—		35,743		—		2,002,234		29,316
Suzhou Lehui Display Co., Ltd.		250,922		—		52,445		—		—		12
LG Display High-Tech (China) Co., Ltd.		1,686		—		5,291		—		2,171,774		2,971

	W	16,568,454		117,842		1,388,478		—		7,639,752		160,025

160

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2022
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Associates and their subsidiaries
WooRee E&L Co., Ltd.	W	—		—		458		—		—		2
AVATEC Co., Ltd.		—		—		58		—		49,007		2,114
Paju Electric Glass Co., Ltd.		—		4,361		208,133		—		—		2,306
YAS Co., Ltd.		—		100		12,182		7,219		—		6,299
Material Science Co., Ltd.		—		—		17		—		—		—

	W	—		4,461		220,848		7,219		49,007		10,721

Entity that has significant influence over the Company
LG Electronics Inc.	W	164,904		—		8,237		241,199		—		83,002
Subsidiaries of the entity that has significant influence over the Company
LG Electronics India Pvt. Ltd.	W	61,598		—		—		—		—		393
LG Electronics Vietnam Haiphong Co., Ltd.		325,101		—		—		—		—		674
LG Electronics Reynosa S.A. DE C.V.		31,475		—		—		—		—		692
LG Electronics U.S.A., Inc.		—		—		—		—		—		1,426
LG Electronics RUS, LLC		—		—		—		—		—		260

161

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the nine-month period ended September 30, 2022
					Purchase and others
(In millions of won)	Sales and others		Dividend income		Purchase of raw material and others		Acquisition of property, plant and equipment		Outsourcing fees		Other costs
Subsidiaries of the entity that has significant influence over the Company
LG Electronics Egypt S.A.E	W	64,943		—		—		—		—		210
LG Innotek Co., Ltd.		4,560		—		40		—		—		61,979
P.T. LG Electronics Indonesia		34,407		—		—		—		—		979
Others		32,962		—		45		—		—		15,299

	W	555,046		—		85		—		—		81,912

	W	17,288,404		122,303		1,617,648		248,418		7,688,759		335,660

162

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued

(c)

Trade accounts and notes receivable and payable and others as of September 30, 2023 and December 31, 2022 are as follows:


	Trade accounts and notes receivable and others				Trade accounts and notes payable and others
(In millions of won)	September 30, 2023		December 31, 2022		September 30, 2023		December 31, 2022
Subsidiaries
LG Display America, Inc.	W	1,118,890		1,193,850		10		6
LG Display Japan Co., Ltd.		209,398		142,262		73		—
LG Display Germany GmbH		173,110		20,386		9,062		26,855
LG Display Taiwan Co., Ltd.		129,939		77,003		89		77
LG Display Nanjing Co., Ltd.		2,032		181		1,369,004		1,126,398
LG Display Shanghai Co., Ltd.		325,535		184,266		—		—
LG Display Guangzhou Co., Ltd.		97		302		1,015,815		1,108,647
LG Display Guangzhou Trading Co., Ltd.		212,318		337,114		—		—
LG Display Shenzhen Co., Ltd.		85,515		108,860		5		—
LG Display Yantai Co., Ltd.		1		4		275,941		252,662
LG Display (China) Co., Ltd.		2,614		2,371		305,841		701,819
LG Display Singapore Pte. Ltd.		38,783		43,891		4		3
L&T Display Technology (Fujian) Limited		23,226		22,452		152,232		114,134
Nanumnuri Co., Ltd.		—		—		2,632		2,121
LG Display Vietnam Haiphong Co., Ltd.		27,302		37,050		1,074,125		1,198,073
Suzhou Lehui Display Co., Ltd.		18,821		13,208		2,299		7,600
LG Display High-Tech (China) Co., Ltd.		17,833		32,272		1,428,260		1,106,458

	W	2,385,414		2,215,472		5,635,392		5,644,853

163

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	Trade accounts and notes receivable and others				Trade accounts and notes payable and others
(In millions of won)	September 30, 2023		December 31, 2022		September 30, 2023		December 31, 2022
Associates
WooRee E&L Co., Ltd.	W	805		878		54		152
AVATEC Co., Ltd.		—		—		2,296		3,756
Paju Electric Glass Co., Ltd.		—		—		48,775		30,431
YAS Co., Ltd.		—		—		4,043		5,827
Material Science Co., Ltd.		—		—		15		—

	W	805		878		55,183		40,166

Entity that has significant influence over the Company
LG Electronics Inc.(*1)	W	50,532		67,953		1,050,813		90,225

164

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	Trade accounts and notes receivable and others				Trade accounts and notes payable and others
(In millions of won)	September 30, 2023		December 31, 2023		September 30, 2023		December 31, 2022
Subsidiaries of the entity that has significant influence over the Company
LG Innotek Co., Ltd. (*2)	W	2,574		3,646		226,105		204,067
LG Electronics Reynosa S.A. DE C.V.		4,561		1,749		18		167
LG Electronics India Pvt. Ltd.		14,047		5,669		10		15
LG Electronics Vietnam Haiphong Co., Ltd.		30,246		50,173		17		53
LG Electronics RUS, LLC		—		—		1,465		—
LG Electronics Egypt S.A.E		2,080		2,008		4		—
P.T. LG Electronics Indonesia		5,237		4,524		90		195
Others		5,080		3,030		4,501		4,495

	W	63,825		70,799		232,210		208,992

	W	2,500,576		2,355,102		6,973,598		5,984,236

(*1) Trades accounts and notes payable and others for LG Electronics Inc as of September 30, 2023 includes long-term borrowings of W1,000,000 million (see Note 12(c)).

(*2) Including deposits received amount W180,000 million from lease agreement.

165

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued

(d)

Details of significant financing transactions with related parties for the nine-month period ended September 30, 2023, is as follows:


(In millions of won)
Entity that has significant influence over the Controlling Company	Borrowings
LG Electronics Inc.(*)	W	1,000,000

Associates	Collection of loans
WooRee E&L Co., Ltd.	W	73

(*) The Company entered into a loan agreement with LG Electronics Inc. on March 27, 2023 for a total borrowing amount of W1,000,000 million, and received W650,000 million on March 30, 2023 and W350,000 million on April 20, 2023.

166

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued

(e)

Conglomerate Transactions

Transactions, trade accounts and notes receivable and payable, and others between the Company and certain companies and their subsidiaries included in LG Group, one of the conglomerates in the Republic of Korea according to the Monopoly Regulation and Fair Trade Act, for the three-month and nine-month periods ended September 30, 2023 and 2022 and as of September 30, 2023 and December 31, 2022 are as follows. These entities are not related parties according to K-IFRS No. 1024, Related Party Disclosures.


	For the three-month period ended September 30, 2023				For the nine-month period ended September 30, 2023				September 30, 2023
(In millions of won)	Sales and others		Purchase and others		Sales and others		Purchase and others		Trade accounts and notes receivable and others		Trade accounts and notes payable and others
LG Uplus Corp.	W	—		599		—		1,847		—		206
LG Chem Ltd. and its subsidiaries		82		91,943		237		259,136		46		148,976
D&O Corp. and its subsidiaries		77		72,856		230		372,705		—		114,485
LG Corp.		—		11,840		1,891		34,672		17,895		5,575
LG Management Development Institute		—		9,252		—		31,137		—		641
LG CNS Co., Ltd. and its subsidiaries		—		42,178		—		119,068		—		35,079
HS Ad Inc. and its subsidiaries (formerly, G2R Inc. and its subsidiaries)(*)		—		1,703		—		11,085		—		2,804
Robostar Co., Ltd.		—		9		—		511		—		147

	W	159		230,380		2,358		830,161		17,941		307,913

(*)	G2R Inc. renamed its name as HS Ad Inc. on July 1, 2023.

167

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued


	For the three-month period ended September 30, 2022				For the nine-month period ended September 30, 2022				December 31, 2022
(In millions of won)	Sales and others		Purchase and others		Sales and others		Purchase and others		Trade accounts and notes receivable and others		Trade accounts and notes payable and others
LX International Corp. and its subsidiaries(*1)	W	—		—		180,596		57,629		—		—
LG Uplus Corp.		—		618		—		1,852		—		349
LG Chem Ltd. and its subsidiaries		53		86,121		237		268,656		39		61,125
D&O Corp. and its subsidiaries (formerly, S&I Corp. and its subsidiaries)(*2)		77		178,853		230		580,162		—		195,059
LX Semicon Co., Ltd.(*1)		—		—		—		241,683		—		—
LG Corp.		—		15,577		—		43,775		14,979		6,287
LG Management Development Institute		—		8,532		—		26,263		—		524
LG CNS Co., Ltd. and its subsidiaries		—		49,009		—		114,402		17		77,533
G2R Inc. and its subsidiaries		—		9,536		—		28,217		—		11,193
Robostar Co., Ltd.		—		294		—		1,137		—		133
LG Household & Health Care		—		—		—		28		—		—

	W	130		348,540		181,063		1,363,804		15,035		352,203

(*1)	The separation of LX affiliates was approved by the Fair Trade Commission on June 21, 2022.

(*2)	S&I Corp. renamed its name as D&O Corp. on April 1, 2022.

168

LG DISPLAY CO., LTD.

Notes to the Condensed Separate Interim Financial Statements

September 30, 2023 and 2022

(Unaudited)

27.	Related Parties and Others, Continued

(f)

Key management personnel compensation

Compensations cost of key management for the three-month and nine-month periods ended September 30, 2023 and 2022 are as follows:


	For the three-month periods ended September 30				For the nine-month periods ended September 30
(In millions of won)	2023		2022		2023		2022
Short-term benefits	W	576		580		1,715		1,734
Expenses related to the defined benefit plan		89		89		266		329

	W	665		669		1,981		2,063

Key management refers to the registered directors who have significant control and responsibilities over the Company’s operations and business.

169

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	LG Display Co., Ltd.

	(Registrant)

Date: November 14, 2023	By:	/s/ Suk Heo
		(Signature)

	Name:	Suk Heo
	Title:	Director / Head of IR Division

170

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Form 6-K - Report of foreign issuer [Rules 13a-16 and 15d-16]

14/11/2023 11:06am

Edgar (US Regulatory)