(June2012)Cheil Industries IR(v2)

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Transcript of (June2012)Cheil Industries IR(v2)

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    Cheil Industries

    June, 2012

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    CONTENTS

    1.Company Overview

    2.Earnings Release 1Q12

    3.Appendix

    This document is provided for the convenience of investors only, before the completion of an external audit.Some figures may be subject to change according to the audit outcomes.

    As the forward-looking statements this release may contain are based on the companysown business outlook, they may differ from the real result. Therefore, the responsibility for investmenton this material is imputed only to investors.

    The financial information in this document are consolidated earnings results based on K-IFRS.

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    1 Company Overview

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    1990 2000 2010 2012(E)

    Chemicals E M Fashion Others

    History (Wbn)

    1,661

    5,113

    1954~ 1979

    Cheil Woolen Fabrics Industries was founded

    as a parent company of Samsung

    1980sMoved into the fashion industry,

    and became the first Korean company

    to produce ready-made clothes

    1990sDiversified the business portfolio to include

    chemicals by developing synthetic resins

    as ABS and PS

    2000~ 2009

    Entered the electronic materials business

    involving the production of semiconductor and

    display materials

    2010 ~

    Continually growing through a diversified

    business portfolio encompassing

    chemicals, EM, and fashion;

    also building new businesses that will bolster

    our future competitiveness

    Cheil Ind at a glance-I

    433 33

    716

    2,267 2,600

    1,413

    1,700

    691

    1,353

    1,700

    6,100

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    Manufacturing innovative casing materialsfor IT devices, home appliances, cars, etc.

    - #1 global market share in resins formonitors, refrigerators

    - #1 domestic & #2 global market sharein resins for mobile phones

    Providing display, semiconductor, PV-relatedmaterials for global IT players

    - CAGR 39% in 2006 ~ 2011

    - #2 biggest material player in Korean market

    - Aggressively exploring new business opportunitysuch as OLED and rechargeable battery

    Operating more than 20 brands coveringcasual, mens, and womens wear

    - #1 player in domestic fashion market

    - Galaxyand Bean Polehave consistently rankedat the top of domestic brand preference

    Cheil Ind at a glance -Business Status Sales (wtn) 3.7 4.3 5.1 5.6 6.1

    O P (wbn) 240 264 330 287340

    2.3 2.42.6

    1.4 1.5

    1.7

    1.51.4

    1.7

    1.81.8

    1.2

    0.8

    1.1

    1.0

    92 123159

    71 100

    95 95 98 105140

    44

    50 52 74 68100

    Sales

    O P

    one-off

    income

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    2008 2009 2010 2011 2012(E)

    Chemicals E M Fashion Others

    Capex (Wbn)

    125

    317

    Cheil Ind at a glance -

    171

    43 52 51

    108 11037 2193

    110140

    88

    41

    83

    81

    120

    49

    420

    242

    2009 2010 2011 2012(E)

    R&D (Chemicals) R&D (E M)

    Workforce (individuals)

    3,257

    4,770

    171

    2,7763,307

    4,190 4,257

    158

    196

    203 196

    307

    349

    332 353

    3,896

    4,869

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    7

    69

    22

    8

    99

    /

    2011

    /

    `11

    `20

    69

    22

    8

    99

    109(5%)

    34(4%)

    47(22%)

    190(CAGR 7%)

    Chemicals

    Electronic

    Materials

    Green/Energy

    2011 2020(E)

    End market

    Reducing Weight of Cars

    Growing demand for IT devices Rapid growth of OLED display

    and rechargeable batteries

    IT devices

    Automobiles

    2011

    1,900

    80 mil

    2020(E)

    2,500

    110 mil

    Business Opportunities

    Materials (Chemicals & EM)

    (Wtn)

    (numbers)

    Fashion

    The growth momentum will be

    placed on global expansion

    - As China is growing rapidly ranked #2

    in global market,

    we will further strengthen our market

    position in China,

    where brands such as Bean Pole, Galaxy

    and Rapido are already established.

    (wtn) 2011 2020 CAGR

    Global 1,750 2,350 3.5%

    US 380 420 1.1%

    China 170 385 9.9%

    Korea 30 45 4.6%

    Materials market will continue expanding driven by newly emerging demand

    (Wtn)

    Materials market

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    Major Products -Chemicals

    Styrene Products Engineering Plastics

    PC

    PC, Flame Retardant PC, PC/ABS, etc.

    ABS

    General ABS, Extrusion ABS,Metal Plating ABS, etc.

    PS

    Flame Retardant HIPS

    Specialties

    Transparent ABS

    - Advanced high transparent ABSwith excellent colors

    Non-painting resin- Gives off the appearance of painted surfacewhile solving flow marks and weld line issues

    Eco-friendly materials

    - Resins made with recycled and used PET

    bottles

    EP

    PBT/ABS, PA/GF, MPPE, etc.

    Automobile Applications

    Providing high-tech materials and solutionin partnership with global automobile makerssuch as Audi, BMW, Ford, etc.

    Interior, Exterior, Lighting, Structure

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    Major Products -Electronic Materials

    Display Semiconductor

    Process materials

    SOH (Spin-on Hardmask)- Supports process migration

    by reducing the amount of Photo Resistused in lithography process

    EMC(Epoxy Molding Compound)- A protector that effectively

    protects semiconductor circuits fromexternal damage and contamination

    EMC

    Packaging materials

    DAF(Die Attach Film)- An adhesive for mounting

    and stacking chips on wafersDAF

    SOD (Spin-on Dielectric)- Insulator for interconnect capacitance

    reduction between transistors ofsemiconductor device

    Film materials

    Polarizer- Polarizes the emissionsgenerated by LCD light sources

    Process materials

    PDP Paste- A high-viscosity liquid-conductive orinsulating substance, used to forminsulating bodies and components of

    electrodesColor Resist- A photosensitive color dispersingagent used in the manufacture ofcolor filters, a core componentin LCDs

    MAS (Prism sheet)- Makes LCD brighter and richer

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    Major Products -Fashion

    Casual

    Bean pole

    Fubu

    Mens Wear

    Rapido (only in China)

    A family brand that includesBean Pole Mens, Ladies, Golf,and etc. It has the strongestbrand power in Koreaas a single casual brand.

    Galaxy

    Galaxy has been ranked the first in surveys

    of brand preference in the past severalyears, and is becoming a world class brandby breaking into the Chinese market.

    Rogatis MVIO Pal Zileri

    Womens Wear

    KUHO

    Theory Issey Miyake

    Launched in 2003, a high-end brandadored by female customers.

    Tory Burch Le Beige

    Fast Fashion (SPA)

    8 seconds

    A Korean fast fashion brand launched in February 2012,

    offering a wide range oftrendy itemsat affordable prices.

    Specialty store retailer of Private label Apparel

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    2 Earnings Release 1Q12

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    4Q11 1Q12 1Q11

    Profitability

    551 613 621

    362376 384

    454429 377

    12

    1Q12 Business Results

    Chemicals E M Fashion Others

    1,400

    Sales (Wbn)

    1,384 1,429

    (Wbn)

    4Q11 QoQ

    1Q12 YoY

    1Q11

    O P 49 94% 95 7% 103

    R P 31 171% 84 24% 110

    N P 40 59% 64 30% 92

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    Financial Ratios

    Financial Status

    Financial Position (Wbn)

    2012.3 2011.12 Change

    Assets 5,367 4,931 436

    Quick 1,619 1,435 184

    Cash 60 96 36

    Receivables 695 485 210

    Inventories 760 743 17

    Non-current 3,748 3,496 252

    Liabilities 1,957 1,714 243

    Total Borrowings 1,017 853 164(Net Borrowings) (931) (763) (168)

    ShareholdersEquity

    3,410 3,217 193

    Total Liabilities

    / Equity

    2010.12 2011.12 2012.3

    Total Borrowings

    / Total Assets

    Shareholder

    Equity Ratio

    Net Debt to

    Equity

    8

    17

    46

    53

    69

    11

    24

    65

    (%)

    57

    64

    27

    19

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    4Q11 1Q12 1Q11

    OP 10 26 36

    % 1.8 4.2 5.7

    Business Review & Outlook

    Chemicals

    621

    Business Results (Wbn)

    551

    Raw materials Price Trend

    Despite high raw materials price and

    low seasonality,

    QoQ sales and margin improved as

    IT demand gradually recovered

    Overall demand to grow as

    set product will increase for the demand

    related with Chinese Labor day

    and Olympics

    613 ($/bbl, ton) 1Q11 4Q11 1Q12

    Oil Price 94 94 103

    S M 1,400 1,316 1,436

    A N 2,503 1,779 2,125

    B D 2,404 2,169 3,426

    ABS(spot) 2,268 1,863 2,096

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