Doosan Infracore Briefs Investors on First Half Performance

- The company achieves W223.4 billion in recurring profit on sales revenue of more than W2.22 trillion

Doosan Infracore held an IR briefing for more than 400 industry analysts, journalists, institutional investors and industry insiders at the Korea Exchange in Seoul's Yeouido District on August 14. Company officials presented performance numbers for the first half of 2007, which included, on a consolidated basis, sales revenue of more than W2.22 trillion, operating profit of W214.5 billion, recurring profit of W223.4 billion, and net profit of W154.4 billion.

On this day, Doosan Infracore Vice Chairman Park Yong-maan personally explained the reasons behind and plans for his company's recent acquisition of Bobcat from Ingersoll-Rand. The US$4.9 billion purchase of the US-based maker of skid steer loaders, mini excavators, attachments and air compressors is the largest overseas takeover ever made by a Korean firm.

A breakdown the sales figures by region reveals W712 billion for Korea (up 26% YoY), W467.4 billion for Europe (up 43% YoY) and W525.5 billion for China (up 38% YoY). Thus, the company has achieved balanced sales growth worldwide. By product category, the highest year-on-year sales increases were seen in construction equipment (22%) and machine tools (31%).

Robust growth and improved profitability in the sale of construction equipment and machine tools in Europe and China helped to boost first half operating income to W214.5 billion, which was 17% higher than a year earlier. Improved non-operating income, including gains on equity method and gains on the sale of equity holdings in Doosan Corporation, increased recurring profit 79% year on year.

The first half sales revenue results are 50% of the 2007 goal, while operating profit is 56% of the figure set for the year. Company officials are confident that they can reach their annual target without any problem. Their optimism is based on an improved product portfolio, the expectation that the full effect of new products launched this year will be felt in the second half, and an ongoing effort to cut costs.

Building a Global Portfolio with the Bobcat Acquisition

Highlighting the IR briefing was the Vice Chairman's presentation on the Bobcat acquisition. During his talk, he stressed:"Our first priority is on mergers and acquisitions that are up to Doosan's standards and can clearly generate excellent synergy with our current competencies. Furthermore, accelerating our management approach will be the key to the success of our M&As. Our purchase of Bobcat presents an opportunity for us to take our construction equipment portfolio, sales network, production network, brand and R&D infrastructure to the top of the global industry all at once. This deal also symbolizes the global stature of the Doosan organization as a whole."