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Investor Relations 2012

This document provides an overview of Hanwha Group's business portfolio, including its balanced product mix in the petrochemical industry. It also highlights the company's shareholder structure and global operations.

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Investor Relations 2012

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  1. Investor Relations 2012

  2. Shareholders & Business Portfolio Balanced product mix among petrochemicals such as PE/PVC/CA ◎ Shareholder Structure ◎ Business Portfolio by Product (as of Dec. 2011) (as of Dec.2011) Hanwha Group 42.7% Floating Shares 53.5% Foreign Ownership 15.73% (as of jun, 2012) OP Contribution by Product PE 38.2%, PVC 26.7%, CA 41.3%, Others -6.2%

  3. Sites & Product Flowchart Unique Business Structure via Vertical Integration ◎ Product Flowchart(Full Integration of Vinyl Chain) ◎ Site Location & Products (as of Dec. 2011) (as of Dec. 2011) (1,000 tons/yr) • LDPE/EVA • EDC • VCM • PVC/PSR • Chlorine • NAOH • PLZ • PA • MA • PV Cell Polymerization Ethylene PE EVA 90 385 247 305 176 194 80 75 5 30MW Naphtha Compounding YNCC Seoul HQ W & C • LDPE • LLDPE • EDC • VCM • PVC • OA • Chlorine • NAOH • HCL • ECH 327 355 1,106 350 297 123 645 710 80 25 Daejeon R&D Center Chlorine PVC EDC VCM Ulsan Plant Polymerization Pyrolysis Salt Yeosu Plant Yeochun NCC Electrolysis NaOH Water 760 Hanwha L&C 3

  4. Yeochun NCC (YNCC) Business Affiliates & Capacity Vertical Integration from Upstream to Downstream (1,000 tons/yr) (as of Dec. 2011) Polyethylene(PE) (1,000 tons/yr) 453 355 LDPE (EVA 140) LLDPE Naphtha Cracker Ethylene 1,910 Propylene 970 BTX 792 SM 290 BD 240 Plastic Processing Polyvinyl chloride(PVC) Floorings PVC Tiles Automotive Parts Artificial Marble Solar EVA Sheets EDC VCM PVC/ PSR PLZ OA 1,491 597 600 160 123 Chlor-Alkali(CA) 821 904 25 Chlorine NaOH ECH (Asian No. 2 NCC, 50% stake) (Plastic processing, 100% stake) Hanwha L&C Hanwha Chemical 4

  5. 2,880 Hanwha Hanwha YNCC* Hanwha 2,800 2,630 1,860 1,530 Economies of Scale Strong Presence in the Korean Petrochemical Industry ◎Ethylene/PropyleneCapacity ◎EVA/LDPE Capacity 453 LG Chemical LG chemical 280 Honam Honam 110 Samsung Total SK Energy 100 Samsung Total (*50% owned by Hanwha Chemical) ◎LLDPE Capacity ◎Chlor-Alkali Capacity (Caustic Soda) 355 904 Honam 290 210 LG Chemical 180 SK Energy Samsung Fine 190 Samsung Total 125 Others 165 LG Chemical 70 (1,000 tons/yr, Korea Petrochemical Industry Association)

  6. Global Operations Aggressively pursuing global expansion since 2008 Saudi Arabia / Jubail EVA/LDPE plant under construction (200,000 tons/yr) China / Ningbo PVC plant (300,000 tons/yr) China / Qidong Hanwha SolarOne (Ingot/Wafer 400MV/yr Cell 500MV, Module 900MV) Thailand / Bangplee ASR plant (10,000 tons/yr)

  7. Financial Summary Performance Summary of 2011 ◎ Consolidated Results ◎ Parent-only Results (KRW bn) (KRW bn) (KRW bn) (KRW bn) (Numbers in 2008 and 2009 based on K-GAAP, and numbers in 2010 and 2011 based on K-IFRS)

  8. Profitability & Financial Soundness Financial Status ◎ Consolidated Operating Profit ◎ Parent-only Operating Profit ◎ Interest Coverage ◎ Liabilities-to-Equity Ratio

  9. Raw Material Price Trend Oil, Naphtha & Ethylene Price ◎ Crude Oil ◎ Naphta / Ethylene ($/ton) ($/ton) ‘12/07 9

  10. Product Price Trend(PE) PE PRICE ◎ LDPE &Spread ◎ LLDPE &Spread ($/ton) ($/ton) 10

  11. Product Price Trend(PVC/CA) Caustic Soda &PVC ◎ Caustic Soda ◎ PVC Price &Spread ($/ton) ($/ton) 11

  12. Management Strategy Global Chemical Leader 2015 Core Business Selection & Intensification Dedicated to increasing profit and maintaining our position as the market leader in the PE, CA and PVC industries by enhancing our global competitiveness Expanding into New Future Businesses Pursuing continuous growth and stable profit by expanding our business into solar, bio, battery materials, nano and other promising industries of the 21st century

  13. Specialty Maker Key Supplier of Specialty Products EVA W&C Compound Alkali-Soluble Resin In 1986, HCC began to produce EVA based on its own technology. HCC now produces various EVA grades, covering a wide range of vinyl acetate content with a melt index that meets the most stringent requirements of its clients HCC is one of the very few in the industry with technology and experience to manufacture ultra clean & high VA content(above 30%) EVA grades for PV cell encapsulation, lamination coating, and hot melt adhesives application Wire and cable compound is a polyolefin-based material added to functional polymers. It is highly functional, with a combination of electrical and mechanical characteristics, as well as strong processing capabilities HCC is one of the top 3 in W&C compound industry and has been in the business since the early 80’s HCC possesses in-house developed technology and offers full range of W&C compound facility design capability HCC is one of the top 3 in ASR industry and is the only player based in Asia HCC provides a broad range of choice to customers by offering 4 grades of standard ASR and 5 grades of specialty ASR Environmentally friendly products have been developed to replace organic solvents in ink, paints and varnishes

  14. PE Business Strategy (1) Higher Contribution of Specialty Products ◎ Sales Volume by Product Type ◎ Average Export Price by Product Type (1,000 tons) (KRW/ton) ◎ Sales Volume Increase of Specialty Products ◎ Contribution Margin by Product Type (commodity contribution margin per ton in 2008= 100) * Specialty Products: EVA, W/C, HS LLD, Blend * Commodity Products: LDPE, LLDPE 14

  15. PE Business Strategy (2) JV in Saudi Arabia to Secure Low-cost Feedstock ◎ Company Overview • Company Name : International Polymers Co. (IPC) • J/V Structure : HCC 25%, Sipchem 75% • Capacity : EVA/LDPE 200 kilotons/yr • Feedstock : Ethane based ethylene (tolled by SABIC) • Project Status : Signed JVA – July 2009 Awarded EPC contractor – Dec. 2010 Plant operation – 3Q 2013 ◎ EVA Supply and Demand • Very tight supply due to shortfall in capacity and rapid increase in global demand driven by China and India • New demand in solar EVA sheet magnifying the supply shortage 15

  16. CA Business Strategy Strong Global Competitiveness & Advanced Cost Structure ◎ Asian No. 3 & Global Top 10 CA Maker through Capacity Expansion in 2010 (1,000 DMT) (1,000 MT) (1,000 MT) 16.6% 11.2% 17.1% NaOH (Caustic Soda) EDC Cl (Chlorine) • Capacity expansion in Yeosu Plant (Caustic Soda: 130, Chlorine:120, EDC: 150 kilotons/yr) • Chlorine is a product showing tendency for regional monopoly. Balanced supply/demand is expected through long-term contracts with BASF Korea, KPX Fine Chemical, Kumho Mitsui and LG-DOW. • Emerged as global top 10 maker in 2010 with production capacity of 900,000 tons of caustic soda and 820,000 tons of chlorine 16

  17. PVC Business Strategy Wholly Independent PVC Plant in China ◎ Capacity Expansion in 2011 ◎ Strategic Significance of China PVC Plant • First global project of Hanwha Chemical • Stronger vinyl chain competitiveness: Emerge as a global PVC player • Maximize profitability through link with MDI business (1,000 MT) 50.3% ◎ China PVC Plant Overview • Production Capacity : Oxy EDC 500, VCM 300, PVC 300 kilotons/yr • Location & Land Area : Zhejiang, Ningbo, 250,000㎡ • S/T & Capex: Feb. 2011, KRW 360 bn • Feedstock: Anhydrous hydrochloric acid (long term contract with Wanhua) VCM (1,000 MT) 53.6% ◎ Effectiveness of China PVC Plant • Outstanding ROI compared to carbide process PVC plant • Boost in PVC chain profits via increased sales portion of CA/PVC from 2011 PVC 17

  18. Global Leader in Solar Business by 2015 Solar Business 400MW 500MW 900MW ◎ Acquisition of Hanwha SolarOne in 2010 ◎ Business Overview • Aggressively expanding Solar business as the new growth driver of Hanwha Chemical • Planning Polysilicon investment - Capa. & location : 10,000 tons/yr, Yeosu - Capex : KRW 1 trillions - Plant operation : 2H 2013 • Cost competitive manufacturing base • Accomplishing economies of scale : Ingot/Wafer 800MV / Cell 1.3GW / Module 1.5GW (by late 2011) • Qualified R&D & management talents • Core customers in Europe & America • Listed in NASDAQ (HSOL) 18

  19. Global Presence based on Cathode Material Foundation for Bio Business through Antibody Therapeutics Cell Material & Bio Businesses • Completed in-house development of LiFePO4 production technology (patent registered ) • Finished construction of a Semi- commercial plant with a capacity of 1,000 tons/yr • Product testing in process with EV & rechargeable battery makers • Developing anode & separator material • Developing Biosimilar & new medicine (HD203 in phase III of clinical trial) • Commercial plant in construction with scheduled commercial production from 2013 • Sales contract signed with Turkish pharmaceutical company in late 2010 • Preparing a contract with a global major BioProduct Battery Material

  20. Business Tie-up with Global Major Company Bio Business Update • Partner : Merck (MSD) ☞ Contract signed on Jun.10 of 2011 • Product : HD203 (Biosimilar of Enbrel®(etanercept)) • Hanwha will receive an upfront payment and additional payments • associated with milestones for technology transfer and regulatory • progress as well as tiered royalties on sales • Merck will conduct clinical development, manufacturing and • commercializing of HD203 in global markets (except in Korea & • Turkey) BioProduct

  21. Bio Business Schedule Bio Product R&D Pipelines Diseases New Drugs HD101 Asthma R&D Preclinical trial Clinical trial Appr. Rheumatoidarthritis HD104 R&D Preclinical trial Clinical trial R&D Preclinical trial Clinical trial HD105 Solid tumors Bio-similar Rheumatoidarthritis Appr. R&D Preclinical trial Clinical trial Commercialization HD203 Breast cancer R&D Preclinical trial Clinical trial Appr. HD201 Commercialization Rectum cancer R&D Preclinical trial Clinical trial HD204 HD205 Rheumatoidarthritis R&D Preclinical trial Clinical trial 21

  22. Major Subsidiaries-Financial Results ◎ Hanwha L&C (Consolidation) ◎ Yeochun NCC (Equity Method) (KRW bn) (KRW bn) ◎ Hanwha Hotels & Resorts (Equity Method) ◎ Hanwha Galleria (Consolidation) (KRW bn) (KRW bn) 22

  23. This material contains forward-looking statements regarding the Company’s financial conditions, operating performance and business plans that do not relate to historical facts or events. These statements relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements can be identified by the use of forward-looking terminology, including the terms “estimates,” “expects,” “plans,” and “anticipates” or other variations of the terms or comparable terminology. Forward-looking statements involve inherent risks and uncertainties which may cause the actual results or performance of the Company to be materially different from any future results or performance expressly stated or implied in the forward-looking statements. The information herein is based on the Company’s plans, estimations and assumptions regarding the operating environment based on conditions as of the day of the presentation. Such plans and estimates may be modified due to changes in the Company’s strategy and the operating environment. The Company undertakes no responsibility to update or revise the forward-looking statements. The Company and the Company’s executives do not assume any liability for losses resulting from the use of the information herein (including losses caused by error). This document does not constitute an invitation or recommendation to invest or otherwise deal in, or an offer to sell or the solicitation of an offer to buy or subscribe for, any security. The information contained herein shall not serve as the basis or grounds for related deals and agreements or investment decisions.

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