Doosan Corp. IR Presentation

Doosan Corp. IR Presentation 2010. 12. TABLE OF CONTENTS 1 Doosan Group’s Transformation 2 D Doosan C Corp’s ’ B Business i O Overview i &P Per...
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Doosan Corp. IR Presentation

2010. 12.

TABLE OF CONTENTS

1

Doosan Group’s Transformation

2

D Doosan C Corp’s ’ B Business i O Overview i &P Performance f

3

Doosan Corp’s Corp s Value as a Holding Company

Appendix : Financials, Financials Highlights Highlights, Introduction of EM

Disclaimer The information herein is provided for your information purposes only and contains preliminary figures which may be materially different from the final figures. We make no guarantees and assume no responsibility for i investment t t decisions. d i i W We ttrustt your decisions d i i will ill b be b based d on your own iindependent d d t jjudgment. d t The financial data in this presentation is non-consolidated basis. 1

Shareholding Structure of Doosan Group

• As of Nov. 30, 2010 • Listed, Unlisted

Doosan Corp Operating Business

(Unit: %)

Doosan Heavy 41.3%

DIP Holdings 100%

DST1) 50.9%

SRS2) 50.9%

KAI3) 10.5%

Samhwa 24%

EM, Mottrol, Fashion, Glonet, I&C

C&E4) 72.8%

Oricom 69.2%

Doosan IInfracore D f 38.8%

73%

Bobcat

Engine E i 53.0%

• Feed & Livestock 100% • Doosan Tower 100% • Doosan Dong-A g 100%

Capital C it l5) 20.0%

DPS6)) 100% Babcock & Skoda

27%

Sold on Oct. 1) DST : Defense System & Technology 2) SRS : System Restaurant Service (KFC & Burger King) 3) KAI : Korea Aerospace Industries ※ Minority shares held by affiliates not displayed

4) C&E : Merged Mecatec on Nov. 1. 5) Capital : Infracore owns 20% shares beside Doosan Heavy 6) DPS : Doosan Power Systems 2

Change from Consumer Goods to ISB*

Business mix ((Sales)) (Unit: KRW tn)

3.4tn

23.4tn

Sales from ISB : KRW 19.8tn

Industrial Goods (33%)

Subsidiaries ISB* (85%)

Consumer Goods (67%) Non-ISB (15%)

’98

(Unit: KRW tn)

• • • • • • • •

Doosan Heavy Doosan Infracore Doosan Const. DII (Bobcat) Doosan Engine Doosan Power System Doosan Mecatec Doosan Mottrol

Sales (Total) 7.3 3.2 2.5 2.0 1.9 1.8 0.7 0.4

Sales from Non-ISB : KRW 3.6tn

’10(E)

* Infrastructure Support Business 3

Change from Local Leader to Global Leader

Top-tier Position in Global Market • • • • •

Nuclear Power Reactor Desalination MSF1) HRSG2) Crankshaft Casting/Forging

Doosan Infracore

• • • • •

Excavator E t Machine Tools SSL/CTL3) Attachment Portable Air Compressor

Engine E&C

• Ship Engine • CPE (Chemical Process Equipment)

Doosan y Heavy

ISB

Non-ISB

Elector-Material

• CCL (Copper Clad Laminator)

1) MSF : Multi –Stage Stage Flashing 2) HRSG : Heat Recovery Steam Generator 3) SSL : Skid Steer Loader, CTL : Compact Track Loader 4

WHY ISB? • As it gets more urbanized, Infra-structure business, such as power plants, civil/housing engineering, construction equipments, desalination, etc. becomes more necessary to support these changes

1100mn of People increased between ’00~’15

No. of cities with more than 0.5mn p people p Increased 146 cities

Population of Urban in the World Less Developed countries More Developed countries

X 1.4

(Unit: 100 Mn)

39

(Unit: No. of cities)

X 1.3

1,015

32 28

23

29

X 1.5

X 1.3 13

783

869

20 8

9

10

’00

’05

’15(E)

’00

’05

’15(E)

※ Source : UN World Urbanization Prospects (2005 Revision Population Database)

5

TABLE OF CONTENTS

1

Doosan Group’s Transformation

2

Doosan Corp’s Overview & Business Performance

3

Doosan Corp’s Value as a Holding Company

Appendix : Financials, Highlights, Introduction of EM

6

Doosan Corp. – Outline • Doosan corporation is an operating holding company [as of Nov.30, 2010]

CEO

James B. Bemowski

Paid-in Capital

W154.1 bn

T t l Shares Total Sh

30,812,425 Shares (Com. 25,042,611)

Market Cap.

W3,796.9bn

Credit Rating

A0

Employees

2,700

Assets as of Sep 30, 2010 (Total Asset W2.9tn) Tangible/

Investment

Current Intangible

63%

21%

16%

60% Equity q y Method Securities W1.756tn

Sales Breakdown by Business [as of Nov.30, 2010, Common Shares]

’09 09 Results (Sales W1.2tn) Others 22.8%

Treasury Shares 26.6%

’10(E) 10(E) Results (Sales W1.5tn)

Others

Mottrol3)

I&C2)

5% 11%

Foreign 14.6% Yongkang Foundation 2 2.0% 0%

Glonet

16%

I&C 47%

EM1)

21%

Park family 34 0% 34.0%

Fashion EM: Electro-Materials I&C: Information & Communication 3) Including only 2H of sales from Mottrol

13% 10%

Glonet 15%

48%

EM

14%

Fashion

1) 2)

7

Reorganization of Business Portfolio • Selection & Concentration : Restructured its business from 12 to 4 business • Merge completion of Doosan Mottrol as of Jul 1, 2010, Fashion business will be closed as of Dec 31, 2010

2006

2007

2008

2009

2010

7/1

12 Business

4 Business

ElectroMaterials

ElectroMaterials

Fashion

Fashion

+

Trading R&D

2011

End in Dec. 2010

Mottrol

Glonet

BIO I&C

I&C

Magazine

• Transfer at W12bn in Oct. 2007

Tower

• Spun off in Dec. 2007

Publishing Food Techpack Liquor

• Spun off in Oct. 2008 • Disposal at W105bn in Nov. 2006

• Disposal at W400bn in Nov. 2008 • Disposal at W503bn in Mar. 2009 8

2010 Outlook • We expect operating revenue to grow by 42% and operating income to turn in black in 2010 – In self-operating business, we expect sales and OP to improve by 33% and 53% YoY – The 3Q accumulated operating revenue & income achieved 74% and 79% versus 2010 Outlook Income Statement (Unit: KRW bn, %)

2009

3Q10 (YTD)

Operating Revenue

1,203.1

1,265.2

+42.9%

1,710.1

+42.1%

- Self-Operating Biz Sales

1,161.6

1,143.0

+34.2%

1,546.1

+33.1%

41.5

122.2

+259.4%

164.0

+295.2%

Operating Cost

1 241 1 1,241.1

1 034 3 1,034.3

+5 4% +5.4%

1 418 1 1,418.1

+14 3% +14.3%

- COGS/SG&A

1,078.2

1,029.0

+31.6%

1,418.1

+31.5%

- Equity Method Loss

162.9

5.3

-97.3%

-

-100.0%

Operating Income

-38.0

230.9

TB

292.0

TB

83.4

114.0

+63.8%

128.0

+53.4%

-121.4

116.9

TB

164.0

TB

- Equity Method Gain

- Self-Operating Biz OP - Equity Method G/L

YoY

2010 Outlook

YoY

9

Operating Business Performance [Yearly Trend] • Sales and OP have continuously increased since 2006 • In 2010, we expect sales and OP to grow by 33% and 53% YoY

Yearly Sales & OP since 2006 (Unit: KRW bn,%)

Sales +33% OP +53%

1,546.1 1 161 6 1,161.6 Sales

859.6

890.4

999.0

128.0 (8.3)

OP (%)

29.0 (3.4) (3 4)

’06

58.8 (6.6)

‘07

47.8 (4.8)

‘08

83.4 (7.2)

‘09

’10(E)*

• Aft After 2Q, 2Q Sales S l and d OP in i 2010 were revised i d up by b 30% and d 188% to t reflect fl t better b tt 1H10 results lt - Only 2H of Sales and OP from Mottrol are added

10

Operating Business Performance [Quarterly Trend] • In 3Q10, sales rose 39% YoY to KRW443.3bn and OP grew 12% YoY to KRW39.0bn – By merging Mottrol in July 1st , Doosan Corp’s sales and OP in 3Q10 showed continuous growth trend YoY (3Q10 Mottrol Sales KRW 93.3bn, OP KRW 13.8bn) Quarterly Sales & OP (Unit: KRW bn,%)

Sales +39% OP +12%

443.3 381.1

319.1 290.9 Sales

OP ((%))

EBITDA

310.0

Mottrol 93.3

318.6

241.5

19.2 ((7.9))

22.1 (7.6)

34.9 (10.9)

30.5 (9.6)

44.5 (11.7)

39.0 (8.8)

13.8 (4.6)

’09.1Q

2Q

3Q

4Q

’10.1Q

2Q

3Q

27.5

31.3

44.2

24.6

39.6

53.8

50.3

• Considering disposed alcoholic beverage business(W6.5bn), the 1Q09 operating profit of W19.2bn is actually W12.7bn 11

Business Units – Sales & OP [Yearly Trend] • Electro Materials

• Fashion

– Dominant market leader in MCCL* & FCCL*

– Local licensing franchise for POLO Ralph Lauren

(U it KRW bn,%) (Unit: b %)

(U it KRW bn,%) (Unit: b %)

731.0 516.0

Sales

OP (%)

522.8

571.9

471 8 471.8

15.5 (3.2) ‘06

26.4 (5.1)

‘07

73.8 (12.9)

249.7

100.4 100 4 (13.7)

OP (%)

6.7 (1.3) ‘08

‘09

Sales

215.8

16.9 (7.8) ‘06

’10(E)

219.7

207.2

198 5 198.5 23.1 (11.6)

‘07

27.6 (12.5)

19.4 (7.7)

‘08

‘09

0 (0) ’10(E)

*MCCL/FCCL (Metal / Flexible Copper Clad Laminate)

• Glonet Gl

• Information I f i & Communication C i i

– Logistic support center in Doosan group (Unit: KRW bn,%)

– IT service provider in Doosan group 229.2

189.6

180 7 180.7

S l Sales

196.3

136.4 OP (%)

-0.6 ((-0.1) 0 1)

-0.8 ((-0.6) 0 6)

‘06

‘07

(Unit: KRW bn,%)

Sales

6.0 (3.3)

6.1 (3.1)

‘08

‘09

8.0 (3.5)

’10(E)

OP (%)

56.2 3.8 (6.7) ‘06

79.9 7.0 (8.8) ‘07

116 5 116.5 12.1 (10.4)

‘08

134.2

146.0

19.5 (14.5)

20.0 (13.7)

‘09

’10(E) 12

A New Growth Engine – Doosan MOTTROL • Doosan Mottrol has been developing and producing Hydraulic components which are essential to various construction equipments and defense systems.

Mottrol’s Mid-term Direction

Products [Hydraulic Components]

• Why Mottrol? – More than 30 years of experiences with hi-efficient technology as a hydraulic components manufacturer – Creating a great synergy effect with current subsidiaries’ business • Mid-term Strategy – Perfect e ec supp supplier e to o cap captive e market, a e, · Expand the supply to Infracore – Expand its business to the global noncaptive market, such as China • Capacity Growth – 2009 cap. 180thn units (15,000 u/m) – 2010(E) cap. 200thn units (17,000 u/m) – 2011(E) cap. 280thn 280th units it (23,000 (23 000 u/m) / )

13

MOTTROL – Sales & OP Trend / Sales Breakdown Sales & OP since 2006

Hydraulic Equipment Sales Breakdown

• Sales showed steady growth since 2006 and normal operating profit margin was approximately 7% • Expected sales of W390bn in 2010 increased by 71% YoY, OP will be increased by 197% YoY (Unit: KRW bn,%)

OP (%)

14.8 (7.6)

Sales +71% OP +197%

17.1 (7 7) (7.7)

14.0 (5.7)

17.2 (7 6) (7.6)

51.1 (13.1)

Forklift*

194.7 17%

Defense

30%

Hydraulic

52% ’06

222.7 222 7 11%

243.7 7% 26%

26%

63% ’07

67%

’08

(Unit: KRW bn,%)

390.5 23%

Sales

• Until 3Q10, Sales in 3 domestic construction equipment makers accounted for 65% • Direct export to China local makers steadily increased to 26%

228.4 228 4 3% 36%

Others3)

140.7 9%

163.3

139.9

220.4

11%

14%

9%

16%

26%

Direct Export p 2)

10%

3 CE Co.1)

81%

74%

70%

65%

’07

’08

’09

3Q10 (YTD)

15%

77%

61% ’09

’10(P)*

*Forklift business has been ceased manufacturing as of July 2009.

1) 3 CE Co. : Infracore, Hyundai Heavy, Volvo Korea 2) Direct Export : China, Attachment export 3) Others : After Service Market 14

Equity Method Gain/Loss • In 2010, we expect total equity method gain of W164bn • In 3Q10, equity method G/L of +W23.7bn was down by KRW36.7bn QoQ ① After 3Q, Mottrol Holdings’ equity method G/L added up to operating profit ② Doosan Heavy’s equity method G/L of KRW 10.5bn has dropped by KRW 28.1bn QoQ 2009 Affiliates

Stake

(Unit: KRW bn, %)

2010

1H

2H

Total

1Q

2Q

3Q

3Q

Acc m lated Accumulated

DHI

41.3%

-112.0

-42.3

-154.3

11.4

38.6

10.5

60.5

Oricom

57.8%

-0.3

1.8

1.5

-

0.9

0.3

1.2

Doosan Dong-A

100%

-7.0

6.0

-1.0

-3.5

-1.5

-0.3

-5.3

Doosan F&L

100%

0

5.0

5.0

1.2

-0.2

2.0

3.0

Doosan Tower

100%

-3.0

2.5

-0.5

1.2

1.2

2.1

4.6

Doosan Mottrol Holdings

100%

-3.2

4.9

1.7

9.9

9.5

Merged

19.5

DIP Holdings

100%

0.8

15.7

16.5

9.7

10.6

9.1

29.4

S h * Samhwa*

-

19 1.9

08 0.8

27 2.7

-

-

-

-

SRS*

-

10.2

0

10.2

-

-

-

-

Others

-

-4.1

0.9

-3.2

2.9

1.3

-

4.0

T t l Total

-

-116.7 116 7

-4.7 47

-121.4 121 4

32 8 32.8

60 4 60.4

23 7 23.7

116 9 116.9

2010(E) ( )

164 0 164.0

* SRS and Samhwa were not displayed since June 29, 2009 (SRS) and August 20, 2009 (Samhwa), respectively → Those are appeared under DIP holdings with valuation of equity method hereafter 15

Affiliates’ Performance • DHI : Although sales in 3Q10(YTD) were down by 5.9% YoY, net income turned surplus in light of equity method gain recovery • DIP Holdings: Net income recorded W29.4bn in 3Q10(YTD) thanks to sales growth from DST and SRS (Unit: KRW bn, %)

2009 Affiliates

3Q10(YTD) Net Income

Sales

YoY

OP

YoY

6,279.5

+10.0%

403.8

-14.9%

-328.3

Increased Deficit

4,251.4

-5.9%

275.0

+5.7%

108.8

Turned Surplus

-

-

21.8

-

16.6

-

-

-

37.7

-

29.4

-

• Doosan DST

706.0

+32.5%

60.4

+295.1%

48.0

+4,253.6%

714.6

+43.8%

59.8

+43.1%

47.0

+42.9%

• SRS

247.1

+9.8%

19.6

+84.2%

16.2

+164.3%

198.4

+6.0%

18.9

+9.2%

13.1

-13.2%

78.2

-0.1%

10.0

+92.3%

11.3

+66.2%

59.8

-0.3%

5.4

-33.3%

4.6

-56.6%

1,086.6

+19.4%

50.4

-36.5%

90.2

+373.3%

884.5

-1.4%

90.4

-19.4%

75.4

-25.4%

Doosan Dong-A

227.1

-2.0%

9.7

Turned Surplus

-1.2

153.7

+6.4%

4.7

Turned Surplus

-5.3

Reduced Deficit

Doosan F&L

126.5

-21.1% 21.1%

5.8

+333.6% 333.6%

5.0

91.9

-5.3% 5.3%

3.1

-39.2% 39.2%

3.0

-25.0% 25.0%

Oricom

76.3

-18.0%

3.6

+6.9%

2.3

-5.6%

60.3

+15.5%

2.6 +766.7%

2.0

Doosan Tower

51.7

+14.6%

14.4

+16.6%

1.1

+33.8%

42.5

+12.7%

17.0 +104.8%

5.8

Neoplux

29.4

+36.0%

5.4

+64.5%

4.4

+87.2%

21.3

+0.9%

DIP Holdings*

• Samhwa • KAI

YoY

YoY

Net Income

OP

DHI

YoY

Sales

Reduced Deficit Turned S l Surplus

6.5

-18.8%

4.9

YoY

Turned Surplus Turned Surplus -16.9%

* DIP Holding is a SPC (Special Purpose Company), No sales recorded. 16

TABLE OF CONTENTS

1

Overview & Shareholding Structure

2

Doosan Corp’s Business Performance

3

Doosan Corp’s Value as a Holding Company

Appendix : Financials, Introduction of EM, Highlights

17

1 Capable of generating stable cash through our own business • Doosan Corp. is capable of generating cash almost W200bn annually through EBITDA and dividend from subsidiaries

Cash Flow (Unit: KRW bn)

EBITDA

128.1

166.1 38.1

Depreciation

OP from Self-operating Business only

Dividend from Sub.

44.7

83.41)

128.02)

23.5

24.5

’09

’10(E)

’11(E)

’12(E)

1) ’09 OP: Sum of EM, I&C, Glonet, Fashion 2) ’10 OP: Sum of EM, I&C, Glonet, Mottrol (Planned zero OP for Fashion) - Only 2H of OP from Mottrol is added (Annual OP of KRW 51.1bn in 2010(P)) 18

2 Aim for shareholders’ value-oriented management as a holding co. • Doosan Corp. paid dividend of W1,000 per share in 2008, W2,500 per share in 2009, and W500 per share in 2010 as an interim dividend. • Dividend will be continuously paid to increase shareholders’ value

Dividend (Unit: KRW)

(Unit: KRW bn, bn %)

`08 Net profit

`10(E)

109.7

232.3

-

24.2

58.3

-

- Dividend per share

W1,000

W2,500

-

Dividend payout ratio

22%

25%

-

1.0%

2.6%

-

Total amount of Dividend

2,000

`09

Year-end D. 1,000 Interim D. ‘081)

500

5002)

Dividend yield ratio2)

’09

’10(E)

※ As of the ending date of stock market in each year

1) It is made for the first time since 1998 2) A As off JJun 30 30, we paid id iinterim t i di dividend id d off W500

19

3 Non-operating assets value • Current Doosan Corp’s market cap just reflects the value of non-operating assets – Market Cap of W3,797bn (as of Nov 30, 2010) vs. Non-operating assets’ adjustment value of W3,804bn – With conservative view, we applied 30% discount to the market value of listed companies and treasury shares Value by Non-operating Assets (Unit: KRW bn)

Market Value Listed1)

DHI

(Current market value) Oricom

Adjustment

Base for Discount

3,527

2,469

· 43.6 mn shares×80,800 w/share (30% discounted)

14

10

· 1.5 mn shares× 9,760 w/share (30% discounted)

3,541

2,479

Unlisted

Doosan Tower

202

202

(Book Value, Sep 30)

DIP Holdings

194

194

81

81

477

477

Properties (Current market value)

168

168

· Ranch at Anmyeon-do, Factory site, etc

Treasury shares3)

971

680

· 30% discounted to the current market value

5,157

3,804

Others2)

Total

· Book values of unlisted companies

1) Li Listed t d companies i market k t values l ((as off N Nov 30 30, 2010) 2) Publishing, Feed & Livestock, Neoplux, etc. 3) Common shares 26.6%, Preferred shares 12.9% (as of Nov 30, 2010) 20

4 Stabilized financials by reducing L/E ratio • As of Sep 2010, L/E ratio was 50%, Net borrowings was W223bn • Credit rating was raised (A- → A0) in April 2010

L/E Ratio & Net Borrowings (Unit: KRW bn, %)

L/E Ratio

Liabilities/Equity 316% Ratio

Net Debt

302%

Disposal of Kimchi Business, Spun off Doosan Tower

216%

Disposal of Techpack, Spun off Publishing Business Disposal of Liquor Business

78% Net Debt

1,315

1,194

949

51%

50%

200

223

489

Credit Rating

’05 05

’06 06

BBB+

BBB+

’07 07

’08 08

’09 09

Sep ’10 Sep. 10

BBB+

A-

A-

A0 21

TABLE OF CONTENTS – Appendix

1. Financial Status 2. Quarterly Performance of Business Units g g 3. 3Q10 Highlights 4. Introduction of Doosan EM •

P d t Products



Competitors, Customers, Position

22

Appendix 1. Financials Status (Non-consolidated basis)

Summary Balance Sheet

Debt & Net D/E Ratio (Unit: KRW bn)

’09.12 Current Assets

(Unit: KRW bn)

’09.12

’10. 9

496.6

629.8

Non-Current Assets

2,251.8

2,311.7

Assets

2,748.4

2,941.5

Current Liabilities

351.2

545.3

Others

Non-Current Non Current Liabilities

581 6 581.6

437.4

Liabilities

932.8

982.7

Paid-in Capital

153.2

154.1

1,815.6

1,958.8

51%

50%

Total Shareholders Equities L/E Ratio

’10. 9

Bank

85.7

130.0

Debentures

300.0

247.0

2.9

2.9

T t l Debt Total D bt

388 6 388.6

379 9 379.9

Cash

188.6

156.5

Net Debt

200.0

223.4

11%

11%

Net D/E Ratio

23

Appendix 2. Business Units – Sales & OP [Quarterly Trend]

• Electro Material

• Mottrol

– Sales surged 17 % YoY – OP was down by -11% YoY due to LED TV inventory adjustment by Set Makers (Unit: KRW bn,%)

(Unit: KRW bn,%)

205.5 Sales

OP (%)

162.1

24.7 (15.2)

3Q09

– Strong earnings growth with diversifying customers – Sales & OP surged by 52% and 128% YoY thanks to strong demand in domestic and China market

169.6

99.1

188.9

153.6

14.0 (9.1)

4Q

24.2 (14.3)

1Q10

35.4 (17.2)

2Q

89.1 Sales

22.0 (11.6)

3Q

OP (%)

61.4

93.3

71.3

6.0 (9.8)

6.5 (9.2)

3Q09

4Q

13.1 (14.7)

1Q10

15.6 (15.8)

13.8 (14.7)

2Q

3Q

24

Appendix 2. Business Units – Sales & OP [Quarterly Trend] • Fashion – Sales have fallen by -17% YoY – OP dropped by -41% YoY (Unit: KRW bn bn,%) %)

• Fashion BG will be dropped at the end of 2010

69.6 Sales

60.5

OP (%)

6.6 (10.9)

3Q09

59.8

4.6 (7.7) 4Q

61.0

6.5 (10.6)

1Q10

50.2 9.5 (13.6)

2Q

4.1 (8.2) 3Q

• Information & Communication

• Glonet

– Sales S l grew +15% Y YoY Y – OP dropped by -30% YoY

– Sales rose +28% YoY – OP was down by -17% YoY

(Unit: KRW bn,%)

(Unit: KRW bn,%)

Sales OP (%)

– Termination of local licensing franchise contract with POLO Ralph Lauren

47.9 1.2 (2.5) 3Q09

51 1 51.1 2.9 (5.7)

4Q

53.7 53

1.9 (3.5) 1Q10

61.2 52 8 52.8

0.6 ((1.1)) 2Q

1.4 (2.3) 3Q

Sales

37.5

OP (%)

7.0 (18.7)

3Q09

43.7 37.1

43.1

33.7

3.5 (9.4)

4.1 (12.1)

4Q

1Q10

6.0 (13.6)

2Q

4.8 (11.1) 3Q 25

Appendix 3. 1Q10 ~ 3Q10 Highlights

Doosan Corp.

Subsidiaries

1Q

• Equity method G/L turned surplus followed by 4Q09 as a result of subsidiaries turnaround

• [DHI] Rising order momentum of nuclear power plants –Won the first oversea project of nuclear power plants in UAE worth USD 3 3.9bn(Dec. 9bn(Dec 2009)

2Q

• Credit rating rose from A– to A0 (April) • Resolution R l ti off the th interim i t i dividend di id d to t 500won per share (June)

• [DI] Remarkable results in Doosan Infracore –Significant Si ifi t performance f iin construction t ti equipment and machine tools from China –DII’s visible improvements in operations

• Completion of Mottrol merger (July 1) • Resolution of closing the fashion business (July) –Termination of License Agreement with POLO Ralph Lauren as of Dec. 31, 2010 • DIP holdings sold its 24% stake in Samhwa Crown & Closure for W30bn (Oct)

• [DHI] Continuous order momentum –Won the Rabigh thermal power plant from Saudi worth around USD3.4bn (Sep) – Won the Desalination plant from Saudi worth around USD1.5bn (Sep) • [Construction] Merge Mecatec (Nov)

3Q

26

Appendix 4. ELECTRO-MATERIAL – Products • EM is one of the global leaders in Cooper Clad Laminate (CCL), which is the core material for Printed Circuit Board (PCB), including flexible CCL and metal CCL, and is extending its product portfolio to materials for OLED

CCL (Copper Clad Laminate)

It is made with copper foil, paper-phenol resin, glass-epoxy resin, or other composite resins according to the application of the product CCL

PCB Form circuit

MCCL (Metal CCL)

FCCL (Flexible CCL)

OLED

End Product Load parts

MCCL are materials that coated TRCC1) on aluminum sheets. It used as the LCD backlight of the LED TV and LED light sources. sources

FCCL requires high resistance against repeated bending and suitability for p electronics,, such as smart phone p and notebooks. the compact

EM produces various kinds of powder that used in the formation of OLED film

1) TRCC: Thermal Resin Coated Copper foil 27

Appendix 4. ELECTRO-MATERIAL – Competitors, Customers, Position

P d t Products

CCL (Copper Clad Laminate)

MCCL (Metal CCL)

FCCL (Flexible CCL)

OLED Material

Competitors

Major Customers

Position in Market

(Domestic & Oversea)

(Domestic & Oversea)

(as of end of 2009)

King g Board, Nanya y

Samsung g Electro-Mechanics,, Daeduck GDS, Korea Circuit etc.

• DomesticNo.1 ((M/S 55%))

CSEM, Hankuk Carbon

Daeduck GDS, Sejong Metal, Teranics, etc.

• Domestic No.1 (M/S 100%)

Nippon Steel Corp. LG Chem, SK Energy

Interflex, YoungPoong Electronics, Daeduck GDS, etc.

• Domestic No.1 (M/S 63%)

Samsung Mobile Display,

• Domestic No.3 (M/S 10%)

LG Display, CMEL

• Global

Panasonic, etc.

Dow, Idemitsu, Ludis

• Global

• Global

• Global

No.6 (M/S 06%)

No.1 (M/S 092%)

No.2 (M/S 15%)

No.7 (M/S 07%)

E.O.D

28