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SKC Annual Report 2006 The Next Growth

Contents 02 04 06 08 10 12 14 22 24 26 28 40 41 42 44 49 96 98

15,000 12,000 13,263 14,090 12,118 1,200 1,000 962 1,170 10,000 8,000 8,167 9,000 6,000 3,000 800 600 400 200 595 6,000 4,000 2,000 2,826 4,054 0 04 05 06 0 04 05 06 0 04 05 06 02 03

May October July December September June November 04 05

1970 ~ 1990 ~ 2000 ~ 2006 ~ 76.12 91. 4 01. 4 06. 5 77.12 96.11 01.11 97. 6 03. 9 06. 6 78. 5 97. 7 03. 9 80. 2 99.10 06. 6 04. 6 06. 7 86. 8 05. 4 05.10 87. 1 05.12 06. 7 06. 9 06.11 06.11 06 07

Next 30 Not resting on our past 30 years success, we will leap toward next 30 years. 08 09

10 11

12 13

4,955 40.8% 17

310 277 310 52 04 05 06 19

30.8% 1,725 957 1,936 04 05 06 21

2007 300 2006 280 2005 270 2004 270 2007 1,700 2006 1,600 2005 1,500 2004 1,450 2007 121.1 2006 109.2 2005 91.0 2004 77.7 22 23

Business Site Korea: 6 China: 6 Xianzhong Polyurethane Xianfeng Polyurethane Sinjin C.E. Anhuidongae Electronics SKC New Material SKC ACME SKC, Inc. (USA) SKC Europe GmbH SKC Taipei Office SKC Japan Office 24 25

China 26 27

4,330 4,803 4,955 5,100 04 05 06 07(E) PO(Propylene Oxide) PG(Propylene Glycol) Polyol(Polypropylene Glycol) SM(Styrene Monomer) 29

30 31

3,900 2,710 3,069 3,263 04 05 06 07(E) 33

34 35

2,700 1,725 1,936 Display 05 06 07(E) 37

38 39

40 41

We Build Trust & Dream 42 43

Management Discussion & Analysis 44 45

46 47

Financial Statements 48

Financial Statements

Balance Sheet Samil PricewaterhouseCoopers Kukje Center Building 191 Hangangno 2-ga, Yongsan-gu Seoul 140-702, KOREA [Yongsan P.O. Box 266, 140-600] 50 51

52 53

Income Statement 54 55

Statement of Retained Earning 56 57

Statement of Cash Flows 58 59

60 61

62 63

64 65

66 67

68 69

70 71

72 73

74 75

76 77

78 79

80 81

82 83

84 85

86 87

88 89

90 91

92 93

94 95

Business Information Tel: 02-3787-1234 / Fax: 02-537-2891 Tel: 052-278-5151 / Fax: 052-278-5544 Tel: 031-250-7114 / Fax: 031-245-2725 Tel: 041-550-9999 / Fax: 041-568-0118 Tel: 031-240-0114 / Fax: 031-247-9303 SKC, Inc. 1 SKC Drive, Covington, GA 30014, USA Tel: 1-678-342-1000 Fax: 1-678-342-1800 SKC Powertech, Inc. 850 Clark Drive Mt. Olive, NJ 07828, USA Tel: 1-973-347-7000 Fax: 1-973-347-7775 SKC Europe GmbH Arabella Center 7Fl, Lyoner Str. 44-48, 60528 Frankfurt, Germany Tel: 49-69-669-0130 Fax: 49-69-666-1071 SKC Co., Ltd. Japan(Liaison) Office Yamato Seimei Building 8FL, 1-1-7, Uchisaiwai-cho, Chiyoda-ku, Tokyo 100-0011,Japan Tel: 81-3-3591-6325 Fax: 81-3-3591-6340 SKC Co., Ltd. Taipei Representative Office No.191, 4F-2, Fuxing North Road Taipei City Taiwan R.O.C 105 Tel: 886-2-2547-4752 Fax: 886-2-2547-4773 SKC Co., Ltd. Korea Shanghai Representative Office Office Room No. 2313, International Trade Center, 2200, West Yan'an Road, Shanghai, China Tel: 86-21-6270-2866 Fax: 86-21-6270-2377 SKC Co., Ltd. Korea Guangzhou Representative Office Metro plaza RM #4605, 183 Tianhebei Road, Guangzhou, China 510075 Tel: 86-20-8755-5402, 5405, 5407 (Ext.100) Fax: 86-20-8755-5151 SKC FuZhou Office - DongGuan GRM Factory TungHA, CANSON Industrial Area, Dongkeng Town, DongGuan, GuangDong Pro., China Tel: 86-769-338-7018 Fax: 86-769-338-6098 SKC FuZhou Office - INDESEN (Fujian) Magnetics Co., Ltd. Rong Qiao Development Region Fuding, Fujian, China 350301 Tel: 86-591-8538-5838 Fax: 86-591-8538-0748 SKC FuZhou Office - SI Digitech Co., Ltd. Golden Mountain Industry Zone, Cang Shan Area, Fuzhou City, Fujian, China 350002 Tel: 86-591-8376-7317 Fax: 86-591-8385-6820 SKC China Suzhou - SKC New Material (Suzhou) Co., Ltd. #1, Tongxing Road, Wujiang Economic Development Zone, Songling Town, Wujiang City, Jiangsu Pro., China. Tel: 86-512-6332-9888 Fax: 86-512-6332-8800 SKC China S&S - S&S Advanced Energy Tech.Co., Ltd. Wujiang Economic Development Zone (Dongyun High-tech & Industrial Park #1), Jiangsu Pro., China 215200 Tel: 86-512-6300-5800 Fax: 86-512-6300-5100 Shenyang Xianzhong Co., Ltd. 25# Taihu ST, Yuhong District, Shenyang City, China Tel: 86-24-2536-9228 Fax: 86-24-2537-5282 Xianfeng Co., Ltd. Guangxinglu, Nansha Economic & Technological Development Zone, Guangzhou City 511457, China Tel: 86-20-8468-8527 Fax: 86-20-8468-8527 www.skcorp.com www.skchemicals.com www.skgas.co.kr www.sk-enron.com www.sktelecom.com www.skcc.com www.sktelink.com www.sktelesys.co.kr corp.nate.com www.sknetworks.com www.skec.co.kr www.skshipping.co.kr www.priden.com www.walkerhill.com www.whotels.com/seoul 96 97

98

www.skc.co.kr