Hot Issue New Product

Transcription

1

2 Hot Issue New Product Launched a new dehumidifying air purifier model - Multifunctional product with a 5-step antivirus air filter and ability to dehumidify up to 10L per day - About 33% faster drying than regular dehumidifying function - Upgraded filter system that removes 99.99% of harmful viruses - 1 st class energy efficiency rating to lower electricity consumption and convenient mobility Launched the Sparkling Water Purifier - An innovative all-in-one product that produces purified, cooled, and carbonated water - Controlling carbonate density to satisfy users taste - Enhanced user convenience by loading automatic water supply system for making carbonated water - Economical product that reduced cylinder replacement fee and rental fee - 4-step RO purification system and self-sterilization

3 Market Review Stock Market In July 2014, the KOSPI recorded a sharp increase of 3.7% compared to the previous month and ended at 2,076.1 points. In early June, it was sluggish due to the earning shock of Samsung Electronics and subsequent slump of leading stocks. Since then, a lot of positive issues such as expectations on stimulation packages by the 2nd national economic team, improvement of economic indices of advanced countries, prospect of ECB s quantitative easing, stable currency exchange rate unleashed a strong rebound of the KOSPI. As a result, it surpassed 2,050 points which had considered as an unassailable resistance line for recent three years. During the period, securities (19.9%), bank (16.3%), electricity & gas (12.5%), construction (10.3%) sectors showed strong price-earnings ratios, while nonmetallic mineral (-3.8%) and pharmaceuticals (-2.9%) sectors weakened. Foreign investors purchased KRW 3.55 trillion worth of stocks, while domestic institutional investors and private investors sold KRW 2.07 trillion and KRW 1.24 trillion worth of stocks, respectively, during the period. The KOSPI in August 2014 is projected to continue to increase backed by breaking through the resistance line and some favorable issues. Internally, expectations are high for the government-led economy-invigorating policies and a decrease of benchmark interest rate by the Bank of Korea. External issues include the improvement of Chinese economic indices and the possibility of quantitative easing of the ECB.

4 Market Review Stock Price Classification % change of COWAY Stock Price vs. KOSPI vs. KOSPI200 %change of KOSPI %change of KOSPI200 5 일 일 일 Coway s stock price recorded an all-time high in early July after sluggishness for a month. And then, it retreated since mid-july due to selling of institutional investors. Nonetheless, it achieved an increase of 4.96% compared to the previous month, outperforming the KOSPI. As the purchasing of foreign investors is being intensified and min to long-term moving average lines are playing roles as supporting lines, it is likely to remain strong. There are many positive factors for future stock price trend. Our new sales for 2Q showed a quarterly record and operating margin also continued year-on-year growth. Our export recorded double-digit growth and mattress sales soared during the period. These performances represented our unrivaled competitiveness in new businesses as well as existing businesses. We expect to realize stable growth in the future backed by increasing demands for environmental home appliances, excellent cash flow creation, capabilities for new product development, and growth potential in the global business. During July, the number of shares held by foreigners increased 925,213 shares or 2.2%, compared with the prior month. As of the end of July, they maintained 54.56% ownership. Domestic institutional investors marked net selling of 682,902 shares during the same period. 42,076,532 shares (as of July 31, 2014) Changes in Stock Price in July 4.96% Changes in Shares Held by Foreigners in July 925,213 shares (2.2%) Net Changes in Shares Held by Institutional Investors in July -682,902 shares

5 Market Review Analyst Ratings Strong Buy Buy Hold Underperform Sell Average Ratings Average Target Price = \108,500 Sell StrongBuy Low : \100,000 High : \115,000 Data Contents Opinion Target Price Source Q14 OP outperformed BUY 110, Margin gains expected entering rental growth... BUY 110, Water purifiers recovery, growth of new... BUY 115, New rental accounts hit quarterly high BUY 112, Solid 2Q, firm outlook BUY 107, Coway looks well positioned to meet forecast... BUY 110, Continued earnings growth, re-rating... BUY 112, Q14 preview: Reliable results despite poor... BUY 106, Focus on sales growth to bear sustainable... BUY 100, Robust earnings to continue, validating... BUY 103,000 Daishin Securities Shinhan Investment Corp Korea Investment & Securities KDB Daewoo Securities Mirae Asset Securities Daishin Securities Shinhan Investment Corp Korea Investment & Securities WOORI investment & Securities KDB Daewoo Securities

6 Conducted Good Education program to develop employee s sensibility Coway News Coway plans to conduct the Good Education program on 23rd at the Dasom class of the head office by inviting an Oriental Doctor Soh-yeong Kim, a former Miss Korea, to give a lecture with the topic of yin and yang, art of health. The Good Education, started in February 2013, is a monthly talk show program to stimulate and develop sensibility of employees by inviting experts from various fields to the Coway s head office and R&D center. Especially, because employees can recommend the lecturer themselves, satisfaction on the lecture is very high. Major lecturers have included Seung-yeon Nah (the former winter Olympic Communication Director), Mi-do Lee (Writer), Sin-ju Kang (Doctor of Philosophy), Ji-min Hong (Musical Actress) and others who are actively participating in various fields. Also, because the lecture is held during work hour, participation rate is higher than other programs. Jae-seok Kim, Head of HR Development Team, said Various experiences of employees will bring out creativity while working and helps them develop ideas. We are planning to develop various programs that will stimulate employees sensibility in the future.

7 Coway s Hanbbyum Ice water purifier won the Energy Winner Award. Coway News - Upgrading energy efficiency by adopting the instant water heating system and water circulation cooling system On July 16, Coway announced that its Hanbbyum Ice (CHPI-380N) water purifier won the Energy Winner Award in the green appliances sector at the 18th Energy Winner of the Year Award. The Energy Winner Award has been hosting every year since 1997 to encourage companies to develop energy-efficiency technology and products and recommend consumers to purchase high energyefficiency products. This year s Energy Winner Award was jointly hosted by the Consumers Korea and the Ministry of Trade, Industry, and Energy, and conducted by the Energy Efficiency Council of Consumers Korea. The award-winning Hanbbyum Ice water purifier was equipped with industry-leading technologies Instant water heating system and water circulation cooling system to enhance energy efficiency. Those technologies help users save approximately 51% of electricity consumption a month compared to our existing ice-making water purifiers. Seon-yong Lee, Chief of Environment Technology Research Center, said Our researchers will and efforts on developing energy-efficiency products were acknowledged through receiving the award. We will continue to lead the development of product with high energy efficiency by capitalizing on Coway s specialized and innovative technologies.

8 Launched the Sparkling Water Purifier Coway News - An innovative all-in-one product that produces purified, cooled, and carbonated water - Controlling carbonate density to satisfy users taste - Enhanced user convenience by loading automatic water supply system for making carbonated water - Economical product that reduced cylinder replacement fee and rental fee - 4-step RO purification system and self-sterilization Coway launched the Sparkling Water Purifier (CPS-240L). This product is an innovative all-in-one product to produce carbonated water as well as purified and cooled water at home. Customized carbonated water generation system and automated water supply system This product helps users easily get customized carbonated water at home. Carbonate density can also be controlled by just putting the button. Furthermore, with a simple touch of button, purified water refills the carbonation bottle inside the product, which makes it easier to use than other existing carbonators. Reasonable rental fee similar to existing premium water purifiers Our sparkling water purifier can create maximum of 60L of carbonated water (carbon cylinder replaced every 2 month based on usage of 1L of carbonated water per day). The replacement fee is KRW 14,400, the lowest level in the domestic market. Especially, Coway has set the rental fee similar to existing premium water purifiers to reduce burden of price on the customers. 4-step RO membrane filter system and self-sterilization function This is a premium product equipped with the 4-step RO membrane filter system and self-sterilization function which was independently developed by Coway. Neo-sense filter and RO Membrane filter system filter out rust residues, residual chlorine, heavy metals, and microorganism. And Plus Inno-sense filter eliminates odor and enhances flavor of the water to make clean water. The self-sterilization system is an innovative technology that uses electrochemical reaction instead of additives to create electrolysis sterilization water that is harmless to human body and cleans internal tank and other places that water flows. Once the sterilization period is set, it automatically sterilizes and makes it safe to use even after not using it for extended period of time.

9 Coway News Power-saving function and user friendly design It applied door-shaped design to make changing carbon cylinder easy and touch display panel and jog dial for easy control. Also, it has the light sensor that automatically controls the operating cycle during the night time to save energy consumption. To celebrate the launch, Coway is giving out 1 free carbon cylinder refill coupon for first 4,000 customers who purchase or rents this product from July through August. Hyeon-jeong Yoon, head of Coway Marketing, said This product was developed by reflecting consumers desire to make carbonated water at home easily. We will utilize our innovative technology as the No.1 water purifier company to lead the carbonated water market. Lump sum sales price is KRW 1.95 million and monthly rental fee is KRW 42.9 thousand (with KRW 100 thousand registration fee)

10 Helping women who discontinued career development Coway News - A lecture on successful reemployment by the head of Coway Cosmetics Business Division - Social contribution program for women who discontinued career development by Re:NK On July 3, Jin-seon Hwang, head of the Coway Cosmetics Business Division, gave a lecture for women who discontinued career development at the Jongno Women Resources Development Center. Coway s cosmetic brand Re:NK has been operating a social contribution program, Re:NK Re:starter Beauty College, since March to help women with career discontinuity to successfully get reemployed. The lecture was hosted by the Jongno Women Resources Development Center to celebrate the 19th Women s Week. It was prepared to suggest women to develop their careers and have a vision. It was conducted for 90 minutes under the theme of Joy of working as a female leader. At the lecture, Jin-seon Hwang said, The most important factor of reemployment is knowing what kind of work I want to do and what I m good at, and Instead of vaguely searching for reemployment, you must reduce trial and error by thorough preparation for the work you want to do. Jin-seon Hwang became the first female executive of Coway. She started her career at the P&G Korea s Sales Department in 1990 and served as a customer marketing director. She also served as a global customer leader and market strategy and planning leader at the P&G Japan. In 2009, she successfully filled the position as the director of sales strategy and men s clothes 1st department at the fashion part of Cheil Industry. In 2013, Coway recruited her to secure competitiveness of its cosmetics business. The Re:NK Re:starter Beauty College is a program to support women who discontinued career development with the full tuition to obtain national certifications for skin care and makeup at the specialized education institutions. It also provides them with consultation services for reemployment in connection with the Jongno Women Resources Development Center. So far, 23 of 40 participants in the 1st class of this year have obtained those certifications.

11 Five products won awards at the IDEA Design Award Coway News - 5 products including the CHP-260 model - Swept the world s top 3 design awards (IDEA, if, and Reddot) for 5 consecutive years On the July 2 nd, Coway announced that its 5 products won design awards at the IDEA (International Design Excellence Awards) The IDEA, a world s most prestige design award hosted by the IDSA, is acknowledged as the Academic Award of design field. Especially, the award-winning hot and cold water purifier (CHP-260) was highly praised for projecting the company s design philosophy and flowing water visually through the design. The front was designed to shape flowing water and pure-white exterior color expresses the company s philosophy of purity. By winning awards at the if Design Award, Reddot Design Award, and IDEA this year, Coway became an enterprise to sweep the world s top 3 design awards for 5 consecutive years. Il-su Yeom, Chief of Design Research Center, said Winning the awards at the world s famous design awards every year can be attributable to Coway s strong will to show design that will satisfy customers. We will continue to provide products with innovative design. The IDEA 2014 Award Ceremony is scheduled to hold at Texas, USA, in August.

12 Coway News Launched a new dehumidifying air purifier model - Multifunctional product with a 5-step antivirus air filter and ability to dehumidify up to 10L per day - About 33% faster drying than regular dehumidifying function - Upgraded filter system that removes 99.99% of harmful viruses - 1 st class energy efficiency rating to lower electricity consumption and convenient mobility Coway launched a new dehumidifying air purifier model (APD-1414C) with upgraded dehumidification function (10L) and air purification. Maintaining low humidity is crucial for creating healthy indoor environment because germs and molds are prolific during the hot and humid summer season. Furthermore, because the virus, germs, and other harmful substances can be left in the air after the dehumidification, indoor air purification is also important. Coway s APD-1414C model is a multifunctional product that can remove harmful virus and fine dust in the air, and also controls indoor humidity with its strong dehumidifying function. This product received the CA certification and HD certification from the Korea Air Cleaning Association for its strong air purification and dehumidification function. The product to dehumidify up to 10L a day is mainly suitable for bedroom, living-room, kitchen, and other indoor areas with high humidity. Especially, the Clothes Drying Function of this product ensures about 33% faster drying than other dehumidifiers. Air purification function was also upgraded by adopting a preconditioning filter to enhance large-dust removal capability in addition to the existing 4-step filter system. In particular, Coway s differentiated Antivirus HEPA Filter not only filters out ultra fine dust but also eliminates harmful viruses by 99.99%. This product obtained the 1st class energy efficiency rating, reducing electricity consumption. Mobility is ensured by casters and arch-shaped handle. Hyeon-jeong Yoon, Head of Coway Marketing Department, said Coway s dehumidifying air purifier is an essential product for the summer season due to its top-notch dehumidifying and air purifying function to maintain crisp and healthy indoor air. It is loved by customers for high space efficiency and multifunction that can be used just as an air purifier except for humid seasons. Lump sum sales price is KRW 1.19 million and monthly rental fee is KRW 40.9 thousand (with KRW 100 thousand registration fee)

13 IR Activities EVENT DATE LOCATION NOTE Overseas NDR ~07-03 USA Woori Investment&Securities EVENT DATE LOCATION NOTE IR Conference_Earning Release for 2Q, Korea Exchange, Yoido, Seoul -