HEALTHY BEAUTIFUL REFRESHING

LG HOUSEHOLD & HEALTH CARE

January 22, 2013

LG Household & Health Care

Results for 2012

CONTENTS

Audit of these results is still in progress. Figures in this disclosure are subject to change during the auditing process.

• 2012 Sales and Operating Profit

• 4Q 2012 Sales and Operating Profit

• 2012 Results by Business

- Healthy

- Beautiful

- Refreshing

• Summary Financial Statements

• 2013 Business Plan

Despite global economic downturn and intensified competition, all business units showed strong growth. Total company

in 2012 delivered 3.90 trillion won in sales (12.7% growth yoy), and 446 bn won in operating profit (20.4% growth yoy)

under the new accounting change on other operating gain or loss. (456 bn won before the change)

228

370

95

126

183

08 10 09 11

2,826

3,456

1,033

1,968

2,216

07

1,172

347

06

12.7%

12

3,896

08 10 09 11 07 06 12

20.4%

446

2012 Results

(Accounting change on other

operating gain or loss*) (Unit: bn won)

Sales Operating Profit

7-Year Trend

2006-2008: K-GAAP, 2009~2012: K-IFRS

2012 Sales and Operating Profit

* Under the new accounting change, other operating gain or

loss is included in non-operating gain or loss

1/7

Sales 3,456 3,896 12.7%

Operating Profit 370 446 20.4%

Recurring Profit 372 430 15.6%

Net Profit 272 312 14.9%

2011 2012 Increase(Unit: bn won)

07 08 10 09

6.2%

11

70

75

21

29

34

07 08 10 09 11

691

831

295

479

525

06

15 06

242

7.1%

12

890

12

79

4Q 2012 Sales and Operating Profit

(Unit: bn won)

4Q Sales 4Q Operating Profit

7-Year Trend

Total company in 4Q 2012 performance was driven by strong cosmetics business, delivered 890 bn won in sales

(7.1% growth yoy), and 79 bn won in operating profit (6.2% growth yoy) under the new accounting change on other

operating gain or loss. Sales has increased for thirty consecutive quarters since 3Q 2005, and operating profit has

increased for thirty-two consecutive quarters since 1Q 2005; beating historic high results every quarter.

2006-2008: K-GAAP, 2009~2012: K-IFRS 2/7

4Q 2012 Results

(Accounting change on other

operating gain or loss*)

* Previously, other operating gain or loss was included in

operating profit. After the accounting change, other operating

gain or loss is included in non-operating gain or loss

Sales 831 890 7.1%

Operating Profit 75 79 6.2%

Recurring Profit 70 77 9.9%

Net Profit 48 54 12.1%

Increase(Unit: bn won) 4Q 2011 4Q 2012

Despite depressed consumption sentiment and weak raw material business performance from fluctuating raw material prices, sales increased 6.8% yoy to 1.27 trillion won and operating profit increased 6.7% yoy to 144 bn won. Excluding raw material business, sales increased 7.8% yoy and operating profit increased 12.3% yoy, growing much faster than the market and continuously enhancing market dominance.

Major categories, led by five mega brands - Elastine, Tech, Perioe, Saffron, and Bodyfit, continued solid growth. Leader position is further strengthened with various new products focused on consumer lifestyle changes, such as: (1) ‘HAN.IP laundry detergent’, light laundry detergent for clothes wore only once, (2) ‘Elastine Perfume Shampoo’, scent-focused shampoo, and (3) ‘Tech OK Soluble Sheet Laundry Detergent’, sheet-type laundry detergent that dissolves in water.

Joint venture with No.1 US green household brand, Method, was established. Moreover, Method and No.1 Europe green brand, ECOVER, were merged. This move enables LG H&H to pioneer premium green trend in Korean household goods market with No.1 US and Europe brands.

HEALTHY

2012

+6.7%

1,266 1,185

2011 2012

144

+6.8%

2011 135

2012 Results by Business - Healthy

Operating Profit

Sales

(Unit: bn won)

(Unit: bn won)

3/7

BEAUTIFUL

+25.3%

1,479 1,227

2011 2012

212

+20.5%

2011 169

2012 Results by Business - Beautiful

Operating Profit

Sales

(Unit: bn won)

(Unit: bn won)

Prestige Masstige Mass OHUI, Whoo, SU:M, Belif,

Frostine, Chungyunjin, Stefany, Others

IsaKnox, LacVert, Sooryehan,

Vonin, Beyond, Others

THEFACESHOP, VDI

(Unit: bn won)

Through various product innovations and practical overseas expansion, sales increased 20.5% yoy to 1.48 trillion won and operating profit increased 25.3% yoy to 212 bn won. Operating profit margin reached 14.3% with 0.5%p expansion.

Existing brands continued to show stable growth, and new brands delivered an outstanding growth in the prestige segment. Each brand fostered star product, strengthening each brand’s RTB (reason to believe). Six prestige brands expanded 29 department store counters in 2012.

In the masstige segment, eco-brand ‘Beyond’ showed strong growth as demand for natural cosmetics grew, rolling out road shops since October. BEAUTÉ de Beautiplex reached 1,068 stores in total.

In the mass segment, TheFaceShop(TFS) sales increased 24.9% yoy, with strong growth from both domestic and overseas. Also, recently launched a new color brand shop ‘VDL’ (Violet Dream Luminous) already opened 6 stores in two months.

Overseas business, on top of strong growth of TFS and acquisition of Ginza Stefany, is continuously increasing its sales portion from 9% in 2011 to16% in 2012.

2011 2012

428 531

24%

2011 2012

474 506

7%

2011 2012

326

442

36%

4/7

Refreshing business sales increased 10.3% yoy to1.15 trillion won, and operating profit increased 35.8% yoy to 89 bn won despite economic down. Growth was led by expanding range of consumer choice through product innovations and coverage expansion.

Coca-Cola Beverage sales increased 9.2% yoy to 910 bn won.

Carbonated beverage sales grew 8.9% yoy through well-balanced performance of major brands, Coca-Cola, Sprite, and Fanta from continued package innovation.

Non-carbonated beverage grew 14.1% yoy. In particular, creation of new demand with Glaceau Vitamin Water, Georgia Coffee, Powerade, and mineral water were accepted by consumers very well.

Haitai Beverage sales increased 14.7% yoy to 241 bn won. Sales increased and synergy between Coca-Cola and Haitai Beverage were created from successful main brand renewals and efficient restructuring of sales organization.

REFRESHING

2012

+35.8%

1,151 1,044

2011 2012

89

+10.3%

2011 66

2012 Results by Business - Refreshing

Operating Profit

Sales

(Unit: bn won)

(Unit: bn won)

5/7

(Unit: bn won) 2011 Year-end

Assets 2,369 2,764

Cash & Cash Equivalent 92 65

Accounts Receivable 327 370

Inventories 306 317

PPE 1,602 1,972

Tangible Asset 855 1,031

Intangible Asset 664 841

Liabilities 1,308 1,493

Accounts Payable 231 168

Other Payables 151 180

Borrowings 565 727

Short Term Borrowings 183 416

Long Term Borrowings 382 312

Total Shareholders' Equity 1,061 1,272

Shareholders' Equity 89 89

Capital Surplus 97 97

Accumulated Other

Comprehensive Income0 -32

Retained Earnings 884 1,120

Other Capital -72 -73

Minority Interest 63 70

Debt-to-equity Ratio 123% 117%

2012 Year-end

Summary Financial Statements (Reflected accounting change on other operating gain or loss)

Income Statement Balance Sheets

6/7

(Unit: bn won) 2011 2012

Sales 3,456 3,896

COGS 1,736 1,903

Gross Profit 1,720 1,993

SG&A and Others 1,350 1,547

Operating Profit 370 446

Non-Operating Loss -2 15

Recurring Profit 372 430

Income Tax 101 118

Net Profit 272 312

2013 Business Plan

2013 business environment will be tougher as: (1) China is expecting limited economic growth, which will influence total

Korean economy, (2) exchange rate will be unfavorable, which will directly impact export competitiveness, and (3) raw

material prices are expected to continue its upward trend. At difficult times like this, it is vital to focus more on

consumers and strive to strengthen market leadership. 2013 sales guidance for total company is 17% growth yoy, and

operating profit guidance for total company is 20% growth yoy.

Firstly, further expand business globally to a bigger market

Competitors lie everywhere world-wide, not only in Korea. Going forward, LG H&H will build business headquarters in

global major markets and expand globally.

Secondly, prestige brands should be more prestigious and value brands should be more value focused

Regular products cannot create value in this bipolarized market. A product should either be prestige or be value

focused. Need to select and focus on certain brands that are prestigious, and magnify value on value brands. Through

these activities, LG H&H can outdo global products.

Thirdly, provide ‘satisfactory experience’, not just a product

Recent heavy price competition is making most of products commoditized. Also, most of LG H&H’s business model

currently is contacting consumers indirectly through other retails. Going forward, we will go beyond simply selling

products, and will prepare to provide the most satisfactory experience to consumers.

Fourthly, strengthen risk management

LG H&H was able to continue its strong growth despite economic downturn because we were prepared. Even though

bigger hardship is confronted in the future, LG H&H would have prepared itself through continuous risk management

and efficiently focusing only on consumer value creating oriented work. 7/7