Investor Presentation Q3 FY2006 1
DISCLAIMER This presentation contains forward-looking statements about Mirae Asset Securities and unaudited preliminary figures internally collected as of December 2006. These figures are subject to change without prior notice, and Mirae Asset Securities is neither obligated to provide revisions, nor responsible for any loss or inconvenience caused by changes regarding the projection and forecast presented in this document.
CONTENTS Market Environment Financial Highlights Performance Review - Asset Management - Brokerage - Investment Banking - Appendix
Market Environment
Equity Market The KOSPI and KOSDAQ market modestly recovered in Q3 FY2006 along with stabilizing daily average trading value since its dramatic fall at FY 2005 end Daily Average Trading Value KOSPI / KOSDAQ Index (KrW billion) 8,000 7,694 7,000 6,000 5,000 4,383 4,651 4,213 4,000 3,000 2,872 2,283 2,322 2,000 1,000 2003.12 2004.12 2005.12 2006.12 Source: KRX (KrW billon) 1,600 800 KOSPI (LHS) 727 1,434 1,400 KOSDAQ (RHS) 1,306 1,295 700 1,200 970 600 1,000 877 591 606 800 807 816 500 469 469 600 376 400 406 400 300 2003.12 2004.09 2005.06 2006.03 2006.12 Source: KRX 5
Indirect Investment Market The market s total fund balance stands at KrW 235 trillion rising 5.4% since the end of FY2005. MAS total fund balance rose 26.9% to KrW 9.9 trillion. The equity fund market grew to KrW 47 trillion rising 34.3% since the end of FY2005 while equity-type balance for MAS rose 38.6% to KrW 5.3 trillion for the same period Market Total Fund Market Total Equity Fund (KrW trillion) (KrW trillion) 240 220 200 180 160 140 120 162 193 187 173 199 197 204 223 222 235 225 50 40 30 20 10 9 11 13 17 26 35 40 44 47 100 2004.06 2004.12 2005.06 2005.12 2006.06 2006.12 0 2004.12 2005.06 2005.12 2006.06 2006.12 Source: AMAK (Asset Management Association of Korea) Source: AMAK 6
Financial Highlights
Net Revenue Breakdown MAS continuously maintains advanced and balanced revenue structure with comparatively high revenue proportion from asset management and a solid track record from investment banking Asset Management - Beneficiary certificates - Wrap account - Bancassurance 23% 28% 33% Brokerage 39% 26% 25% Investment Banking - Underwriting & IPO - Prop. trading - Fixed income securities - Principal Investment 22% 31% 27% Interest Profit & Other 16% FY2005 15% Q2 FY2006 15% Q3 FY2006 Source: MAS (Net Revenue = Operating Income Operating Expenses excl. G&A expenses) 8
Financial Highlights Due to strong rebounding sales of beneficiary certificates in Q3 FY 2006, MAS achieved KrW 442 billion in operating income and KrW 82 billion in net income for Q1~Q3 FY 2006 Operating Income Net Income [KrW million] [KrW million] CAGR ( 00 ~ 05) CAGR ( 00 ~ 05) 33.3% 40.4% 432,133 442,028 91,517 81,997 102,517 223,861 264,014 293,905 272,842 16,774 13,670 17,409 43,662 31,261 FY2000 FY2002 FY2004 Q1~Q3 FY2006 Source: MAS FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 Q1~Q3 FY2006 Source: MAS 9
Financial Highlights Income & G&A [KrW million] Items Q3 FY2006 Q2 FY2006 QoQ Operating Income 186,230 120,228 54.9% Operating Expenses 143,038 83,162 72.0% A. Other Operating Expenses 101,621 41,520 144.8% B. G&A Expenses 41,417 41,642-0.5% Net Revenue (Operating Profit + G&A Expenses) 84,609 78,708 7.5% Operating Profit 43,192 37,066 16.5% Non-operating Profit 1,423 137 938.7% Non-operating Expenses 742 570 30.2% Ordinary Profit 43,873 36,633 19.8% Net Income (After Tax) 32,085 26,559 20.8% G & A Expense Details Q3 FY2006 Q2 FY2006 Amount Portion Amount Portion G &A 41,417 100% 41,642 100% Salary & Compensation 23,725 57.3% 23,336 56.0% Depreciation 1,467 3.5% 1,438 3.5% Rental Expenses 1,367 3.3% 1,253 3.0% IT Cost 1,791 4.3% 1,725 4.1% Misc. Commissions 1,925 4.6% 1,666 4.0% Advertising Expenses 4,751 11.5% 6,696 16.1% Others 6,391 15.5% 5,528 13.3% Source: MAS 10
Financial Highlights Income Statement [KrW million] Items Q3 FY2006 Q2 FY2006 Q1 FY2006 FY2005 FY2004 FY2003 Operating Income 186,230 123,062 132,736 432,134 272,842 293,905 A. Commissions Received 63,916 59,564 62,826 234,076 106,181 105,033 1) Brokerage commission 27,152 25,811 31,083 142,433 74,497 77,945 2) Underwriting commission 760 4,468 844 9,702 5,094 5,845 3) Brokerage Commission on beneficiary certificates 23,673 17,217 22,431 56,883 12,221 9,622 4) Commission from Wrap account & asset management 1,955 1,857 1,956 5,143 1,736 350 5) Others 10,376 14,145 6,512 19,915 12,633 11,271 B. Interest Income 18,835 15,754 12,035 48,796 19,184 21,844 C. Dividends Income 36 38 70 223 158 865 D. Distribution Income - 75 162 160 224 415 E. Gain on Sales of Trading Securities 8,540 9,147 14,261 45,806 36,088 23,347 F. Gain on Valuation of Trading Securities 7,251 (83) 2,141 1,422 1,522 80 G. Gain on Valuation of Deposits 5,622 5,647 6,077 18,384 12,705 14,479 H. Gain on Derivatives Transactions 14,548 14,985 20,492 83,180 96,780 127,836 I. Others 67,482 17,935 14,672 86 2 6 Operating Expenses 143,038 86,058 100,636 294,587 220,354 229,885 A. Other Operating Expenses 101,621 44,302 59,736 146,206 121,134 128,199 B. G&A Expenses 41,417 41,756 40,900 148,381 99,220 101,686 Net Revenue (Operating Profit + G&A Expenses) 84,609 78,760 73,000 285,928 151,708 165,706 Operating Profit 43,192 37,004 32,100 137,546 52,488 64,020 Net Profit (Before Tax) 43,873 36,634 32,429 128,349 46,570 63,261 Net Income (After Tax) 32,085 26,569 23,343 91,527 31,261 43,662 11
Financial Highlights Balance Sheet [KrW million] Items Q3 FY2006 Q2 FY2006 Q1 FY2006 FY2005 FY2004 FY2003 Total Assets 3,309,592 2,749,859 2,476,218 1,509,682 824,258 704,979 Ⅰ. Current Assets 3,138,736 2,588,435 2,315,391 1,373,547 677,867 602,121 Ⅱ. Fixed Assets 170,856 161,424 160,827 136,134 146,391 102,858 Total Liabilities 2,724,926 2,196,809 1,949,424 979,442 578,715 481,301 Ⅰ. Current Liabilities 2,722,839 2,195,418 1,947,671 978,066 577,790 480,623 Ⅱ. Long-term Liabilities 2,087 1,391 1,753 1,377 926 678 Total Shareholder's Equity 584,666 553,050 526,793 530,239 245,542 223,678 I. Stockholder's Equity 134,925 134,925 134,925 134,750 112,800 112,800 II. Capital Surplus 213,133 213,134 213,133 213,032 35,721 35,721 III. Retained Earnings 237,418 205,502 178,932 182,539 98,908 76,685 IⅤ. Capital Adjustment (810) (511) (197) (81) (1,887) (1,528) Total Liabilities & Stockholder's Equity 3,309,592 2,749,859 2,476,217 1,509,682 824,258 704,979 12
Performance Review
Asset Management Market Share MAS fund market M/S continuously increased for the quarter recording M/S of 4.2%, an 0.3% increase QoQ Quarter-end Balance of Fund Sales [KrW billion] Fund sales M/S (RHS) Fund balance (LHS) 9,914 10,000 8,659 9,000 8,312 7,811 8,000 6,565 7,000 5,923 6,000 5,430 5,000 4,000 3,000 2,000 1,000-2005.06 2005.12 2006.06 2006.12 M/S 5.0% 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% Source: Company data, AMAK 14
Asset Management Fund sales by type Equity-type fund which is a main source of profit for MAS recorded KrW 5.3 trillion for the quarter [KrW billion] Others MMF Hybrid Bond-type Domestic equity-type Overseas equity-type 9,914 8,659 8,312 7,811 2,179 6,565 1,138 1,320 388 5,923 1,084 814 669 1,115 5,430 1,029 1,126 956 513 1,016 935 554 1,137 829 1,038 1,514 955 1,337 951 785 795 3,223 1,096 1,043 2,984 3,119 1,170 2,799 1,065 2,048 1,538 1,113 266 394 524 1,022 1,406 1,558 2,074 2005.06 2005.09 2006.12 2006.03 2006.06 2006.09 2006.12 22% 4% 11% 9% 33% 21% Equity-type Proportion 25% 33% 39% 49% 53% 54% 54% Source: MAS 15
Asset Management Installment type fund As end of November, number of market installment type account stands at 7.4 million accounts and MAS M/S increased 0.2% QoQ to 3.3% Installment-type Fund Accounts M/S (Unit: No. of million account) 8 7 6 5 4 3 2 1 Market (LHS) MAS M/S (RHS) M/S 4.0% 3.5% 3.0% 0 2005.03 2005.06 2005.09 2005.12 2006.03 2006.06 2006.09 2006.11 2.5% Source: AMAK 16
Brokerage - Equity Equity brokerage M/S maintained 7.2% along with commissions generated from institutions declining slightly Equity Brokerage M/S Brokerage Breakdown 9% 8% 7% 6% 5.9 5.8 7.3 7.2 8.2 8.4 8.2 6.9 7.1 7.2 Offline (Ins.) Offline (Retail) Online (Retail) 20% 18% 2% 2% 78% 80% 45% 44% 10% 11% 5% 5.7 45% 45% 4% Q1 FY04 Q3 FY04 Q1 FY05 Q3 FY05 Q1 FY06 Q3 FY06 Q2 FY06 Q3 FY06 Q2 FY06 Q3 FY06 Trading Value Commissions Source: MAS Source: MAS 17
Investment Banking MAS continues to focus on strengthening IB competency and successfully raised PI biz in Q3 Q3 FY2006 Performance IPO Performance Net Revenue Breakdown (In 100 million KrW) (KrW billion) Q3 FY06 Q2 FY06 Investment Banking 6 25% 11 61% IPO, Underwriting, ABS, M&A Fixed Income Securities 7 29% 3 17% Dealing 3 13% 4 22% Futures & Option dealing Principle IB 8 33% TOTAL 24 100% 18 100% Year 2006 2005 2004 No. of IPOs Pyungsan & other 1 Dom & other 7 Core Logic & other 5 Amt 733 1,139 661 2003 Giga Telecom & other 9 1,162 2002 Korea Ratings & other 5 793 Source: MAS Source: S-IPO 18
Appendix
Mirae Asset Group - AUM Mirae Asset Group continues to lead the indirect investment market with M/S of 9.4% (32.7% M/S for equity-type fund) Total Fund Market vs. MAG Total Equity Fund Market vs. MAG [KrW billion] [KrW billion] 250,000 225,000 Total Market (LHS) 22,109 MAG (RHS) 20,172 18,927 17,288 25,000 20,000 50,000 40,000 Total Equity-type (LHS) MAG (RHS) 15,202 14,278 13,200 11,885 17,500 15,000 12,500 200,000 175,000 8,8288,775 9,955 12,133 15,000 10,000 5,000 30,000 20,000 10,000 2,841 2,109 4,299 6,602 10,000 7,500 5,000 2,500 150,000 2005.03 2005.09 2006.03 2006.09 - - - 2006.12 2005.03 2005.09 2006.03 2006.09 2006.12 Source: AMAK 20
Mirae Asset Group - Positioning Within in the Mirae Asset Group, Mirae Asset Securities is at the core of the group s sales and distribution channel well positioned to benefit from the group s asset management arm Financial Group Mirae Asset Investment Management Mirae Asset Global Invest. Mgmt. (Asia) (Singapore) Mirae Asset Maps Invest. Mgmt. Mirae Asset Global Invest. Management (Hong Kong) Asset Management Arm Investment Arm Mirae Asset Securities Mirae Asset Life Insurance Mirae Asset Capital Mirae Asset Venture Investment 21
Thank You For more information, please contact MIRAE_IR@miraeasset.com or visit www.miraeasset.com.