Q News Letter. Signing gas sales MOU. Signing MOU on joint exploration project with CNPC. Selling buses to Azerbaijan. Social Contribution

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Walter Ray
5 years ago
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1 Q News Letter H Performance Sales : USD 4,787MN Operating Income : USD 81MN EBT : USD 69MN Signing gas sales MOU Signing MOU on joint exploration project with CNPC Selling buses to Azerbaijan Social Contribution Helping fruit farm 'Cham-Da-Rae Village' The 9 th Beautiful Saturday with Daewoo International

1 st Half Performance for FY 2008 Sales : USD 4,787MN, Operating Income : USD 81MN, EBT : USD 69MN Sales : USD 1,062MN increased in comparison with the same period of 2007 (28.

1% ) Income USD 52MN increased in comparison with 2 nd half of 2007 (177.

environment such as the high prices of crude oil and raw materials, and the instability of international financial markets, the Company achieved outstanding performance in the 1st half of 2008.

2 1 st Half Performance for FY 2008 Sales : USD 4,787MN, Operating Income : USD 81MN, EBT : USD 69MN Sales : USD 1,062MN increased in comparison with the same period of 2007 (28.5% ) USD 1,021MN increased in comparison with 2 nd half of 2007 (27.1% ) Operating : USD 22MN increased in comparison with the same period of 2007 (37.1% ) Income USD 52MN increased in comparison with 2 nd half of 2007 (177.7% ) Despite outer disadvantages, achieved most outstanding performance ever Operating income grew up through sales expansion and high valueadded businesses Despite the unfavorable external economic environment such as the high prices of crude oil and raw materials, and the instability of international financial markets, the Company achieved outstanding performance in the 1st half of Based on global networks and the cumulative ability of developing new items, business sources and new markets, export during the 1st half of 2008 increased by 26.7% as compared with the 1st half of 2007, 21.4% as compared with the 2nd half of Tri-lateral trading also grew up by 32.7% as compared with the 1st half of 2007 and 38.3% as compared with the 2nd half of Operating income and margin are improved by sales growth and value added business. While other trading houses are overly dependent on their group companies products, the Company is actively conducting highly complex business which requires integration of trading, financing, engineering and manufacturing issues with approximately 6,000 customers from 180 countries. The depreciation of KRW caused temporary loss on valuation currency translation (mainly caused by long-term withholdings, related with natural resources investment, and reserve for contingencies), and it leaded to the decrease of EBT within narrow limits H Financial Status Assets : USD 2,622MN, Liabilities : USD 1,645MN, Equity : USD 977MN Debt to equity ratio was up to 168% owing to the increase of trade A/R,A/P and short-term borrowings Assets and liabilities rose by USD 548MN and USD 518MN respectively from the end of Current assets and liabilities such as trade A/R,A/P and short-term borrowings rose by USD 443MN, USD 482MN each, due to the expansion of international trading. - More valued Equity method investments including Kyobo Life insurance and the expansion of natural resources exploration raised Non-current assets by USD 105MN Equity rose by USD 30MN from the end of (+) Net income of the 1st half (USD 50MN) and accumulated other comprehensive income (USD 12MN) - (-) dividend pay out (USD 32MN)

3 Business Performance Detail Unit: $MN H H H YoY HoH Sales 4,931 6,118 7,491 3,725 3,766 4,787 1,062 1,021 Operating Income Operation Margin 1.2% 1.2% 1.2% 1.6% 0.8% 1.7% Nonoperating Income Interest Coverage 2.3X 3.2X 5.0X 6.6X 3.4X 11.7X EBT Net Income Assets 1,634 1,849 2,074 2,025 2,074 2, Liabilities ,127 1,134 1,127 1, Borrowings (P.V.) Equity Social Contribution Helping fruit farm 'Cham-Da-Rae Village' The Company and employees voluntarily helped a fruit farm, 'Cham-Da-Rae Village' from 17 May to 25 May. The Company set up sisterhood relationship with the farm and is helping them with their work regularly. On this time, including CEO Young-Won Kang, 70 employees participated in this event. In November, another assistant event will be held for their harvest. 9 th Beautiful Saturday with Daewoo International The 9th Beautiful Saturday, in which the Company took part, has been opened in Beautiful Shop, Ankook branch on June 14. The Company and employees donated products and worked as of clerk of the shop voluntarily in this event, and all benefits will be spent for unfortunate neighbors. On this time, especially 'Ja-ran-mal Rice', the principal product of Cham-da-rae Village, was contributed, too.

Signing gas sales MOU The Company has signed a memorandum of understanding (MOU) for the sales of natural gas produced from Myanmar s offshore blocks A-1 and A-3 to CNPC (China National

The Company will take a dominant position with a 51 percent stake in the consortium; ONGC 17 percent; MOGE 15 percent;

4 Signing gas sales MOU The Company has signed a memorandum of understanding (MOU) for the sales of natural gas produced from Myanmar s offshore blocks A-1 and A-3 to CNPC (China National Petroleum Corporation) on Monday, June 20. In particular, the MOU is a legally binding contract which includes major terms of production, transport and sales. The Company will take a dominant position with a 51 percent stake in the consortium; ONGC 17 percent; MOGE 15 percent; GAIL 8.5 percent; and KOGAS 8.5 percent. The Company will maximize profit not only by selling the gas produced from Myanmar s offshore blocks A-1 and A-3, but also carrying out a pipeline construction business and participating in a gas transport business during the sales period. The Company expects to generate more than $10 billion in profit over the 25 years after embarking on the gas production in Signing MOU on joint exploration project with CNPC The Company and CNPC signed a memorandum of understanding in Beijing on May 28 on a joint exploration project in Myanmar. Lee Eun-ho, South Korean Minister of Knowledge Economy and Jiang Jiemin, CNPC President, attended the signing ceremony.

It was formed last year and 300 of them were shipped already. The Azerbaijan transport ministry expanded the contract by 200 units in the latest deal.

5 Selling buses to Azerbaijan The Company has signed an agreement to ship 1,000 buses to Azerbaijan on May 19. The latest deal was an extension of a previously signed contract, supplying 1,100 buses for urban use to the Azerbaijan Ministry of Transport. It was formed last year and 300 of them were shipped already. The Azerbaijan transport ministry expanded the contract by 200 units in the latest deal. (Unshipped yet : 800 1,000 buses) In the latest deal, the bus model to be supplied to the country has also been upgraded from ordinary urban transport models to a higher-end model. With the addition of the 200 units to the contract and the upgrading of the model, the Company will supply a total of 1,300 buses to Azerbaijan and the whole value of the contract is estimated at $120 million. Contact Details Hong-soo Seol, Executive Vice President, Finance&Accounting Div. ( , hsseol@daewoo.com) Young-Ha Park, Director, Finance Team ( , yhpark@daewoo.com) / Nam-Gi An, Manager, Finance Team ( , ngan@daewoo.com) Sang-Yong Kwak, Manager, Finance Team ( , sykwak@daewoo.com) / Hee-Tae Kim, Asst. manager, Finance Team ( , htkim73@daewoo.com) Hye-Sook Kim, Asst. Manager,Finance Team ( , hskim13@daewoo.com) / Hye-Sun Han, Asst. Manager, Finance Team ( , hshan02@daewoo.com) Hang-Sun Ahn, Staff, Finance Team ( , issuxark@daewoo.com)

2008 Hyosung Financial Statements

2008 Hyosung Financial Statements Table of Contents 03 Report of Independent Auditors 04 Non - consolidated Balance Sheets 06 Non - consolidated Statements of Income 07 Non - consolidated Statements of