01 LGE 17 3Q (Con)Report v5 - LG Electronics

1 LG Electronics consolidated Interim Financial Statements September 30, 2017 and 2016. LG Electronics Index September 30, 2017 and 2016. Page(s). Report on Review of Interim Financial Statements .. 1-2. consolidated Interim Financial Statements consolidated Interim Statements of Financial Position .. 3. consolidated Interim Statements of Profit or Loss .. 4. consolidated Interim Statements of Comprehensive Income .. 5. consolidated Interim Statements of Changes in Equity .. 6. consolidated Interim Statements of Cash Flows .. 7. Notes to the consolidated Interim Financial Statements .. 8 - 83. Report on Review of Interim Financial Statements (English Translation of a Report Originally Issued in Korean).

2 To the Board of Directors and Shareholders of LG Electronics Inc. Reviewed Financial Statements We have reviewed the accompanying consolidated interim financial statements of LG Electronics Inc. and its subsidiaries (collectively referred to as the Group ). These financial statements consist of the consolidated interim statement of financial position of the Group as of September 30, 2017, and the related consolidated interim statements of profit or loss and comprehensive income for the three-month and nine-month periods ended September 30, 2017 and 2016, and consolidated interim statements of changes in equity and cash flows for the nine-month periods ended September 30, 2017 and 2016, and a summary of significant accounting policies and other explanatory notes, expressed in Korean won.

3 Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these consolidated interim financial statements in accordance with International Financial Reporting Standards as adopted by the Republic of Korea ( Korean IFRS ) 1034 Interim Financial Reporting, and for such internal control as management determines is necessary to enable the preparation of consolidated interim financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to issue a report on these consolidated interim financial statements based on our review.

4 We conducted our review in accordance with quarterly or semi-annual review standards established by the Securities and Futures Commission of the Republic of Korea. A review of interim financial information consists 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.

5 Conclusion Based on our review, nothing has come to our attention that causes us to believe the accompanying consolidated interim financial statements are not presented fairly, in all material respects, in accordance with Korean IFRS 1034 Interim Financial Reporting. Other Matters We have audited the consolidated statement of financial position of the Group as of December 31, 2016, and the related consolidated statements of profit or loss, comprehensive income, changes in equity and cash flows for the year then ended, in accordance with Korean Standards on Auditing. We expressed an unqualified opinion on those financial statements, not presented herein, in our audit report dated March 9, 2017.

6 The consolidated statement of financial position as of December 31, 2016, presented herein for comparative purposes, is consistent, in all material respects, with the above audited statement of financial position as of December 31, 2016. Review standards and their application in practice vary among countries. The procedures and practices used in the Republic of Korea to review such financial statements may differ from those generally accepted and applied in other countries. November 14, 2017. Seoul, Korea This report is effective as of November 14, 2017, 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 consolidated interim financial statements and notes thereto.

7 Accordingly, the readers of the review report should understand that there is a possibility that the above review report may have to be revised to reflect the impact of such subsequent events or circumstances, if any. 2. LG Electronics consolidated Interim Statements of Financial Position September 30, 2017 and December 31, 2016. (in millions of Korean won) Notes September 30, 2017 December 31, 2016. (Unaudited). Assets Current assets Cash and cash equivalents 5,30 3,486,505 3,015,137. Deposits held by financial institutions 5,30 80,516 80,559. Trade receivables 5,6,30 7,737,606 7,059,889. Loans and other receivables 5,6,30 427,778 545,766. Other financial assets 5,7,30 1,032 30,650.

8 Inventories 8 6,357,977 5,171,015. Current income tax assets 108,979 147,221. Other current assets 1,026,281 931,420. Assets held for sale 32 371,197 8,906. 19,597,871 16,990,563. Non-current assets Deposits held by financial institutions 5,30 58,784 58,195. Loans and other receivables 5,6,30 483,820 490,178. Other financial assets 5,7,30 55,132 66,147. Property, plant and equipment 9 11,385,099 11,222,428. Intangible assets 9 1,777,953 1,571,087. Deferred income tax assets 1,348,966 1,554,594. Investments in associates and joint ventures 10 5,695,847 5,104,558. Investment properties 96,042 97,031. Net defined benefit assets 12 221 730. Other non-current assets 627,463 699,758.

9 21,529,327 20,864,706. Total assets 41,127,198 37,855,269. Liabilities Current liabilities Trade payables 5,30 8,127,240 6,746,361. Borrowings 5,11,30 1,167,148 1,650,511. Other payables 5,30 3,233,840 3,196,735. Other financial liabilities 5,7,30 3,866 21,115. Current income tax liabilities 121,953 74,263. Provisions 13 645,143 770,967. Other current liabilities 3,713,877 3,284,412. 17,013,067 15,744,364. Non-current liabilities Borrowings 5,11,30 7,996,522 7,008,500. Other payables 5,30 9,322 7,771. Other financial liabilities 5,7,30 51,018 73,226. Deferred income tax liabilities 8,344 9,586. Net defined benefit liabilities 12 709,892 511,252. Provisions 13 302,187 1,028,298.

10 Other non-current liabilities 111,989 115,530. 9,189,274 8,754,163. Total liabilities 26,202,341 24,498,527. Equity attributable to owners of the Parent Company Paid-in capital: 14. Share capital 904,169 904,169. Share premium 3,088,179 3,088,179. Retained earnings 15 10,798,276 9,233,416. Accumulated other comprehensive income 16 (1,067,291) (1,028,962). Other components of equity 17 (209,764) (209,708). 13,513,569 11,987,094. Non-controlling interests 1,411,288 1,369,648. Total equity 14,924,857 13,356,742. Total liabilities and equity 41,127,198 37,855,269. 3. LG Electronics consolidated Interim Statements of Profit or Loss Three-Month and Nine-month Periods Ended September 30, 2017 and 2016.