Introduction of Introduction of HICELHICEL

Creating a Better Future

CONTENTSCONTENTS

I.I. Company OverviewCompany Overview

1. Overview1. Overview

2. History2. History

3. Management3. Management

4. Business & Organization4. Business & Organization

II. BLS II. BLS

BusinessBusiness1.1. BLS?BLS?

2.2. Market ProspectMarket Prospect

3.3. Products & TechnologyProducts & Technology

4.4. SWOTSWOT

5.5. SalesSales

6.6. Business ProspectBusiness Prospect

1.1. Littles BusinessLittles Business

2.2. Build-A-Bear BusinessBuild-A-Bear Business

3.3. Sports BusinessSports Business

4.4. Sales Plan in 2008Sales Plan in 2008

III. SidusIII. Sidus SL SL

BusinessBusiness

“Creating a Better Future”Hicel Co.,Ltd 3

ShareholdersOverview

1. Company Overview1. Company Overview

Shares92,765,444

Institutional Investors & Individuals

67.09%

Treasury Stock1.60%

Largest Shareholders

31.31%

CEO Mr. Jong-Sun, Yoon

Establishment

Sep. 1998

Location1027-3, Eyon-Hansan Industrial Park, Cheongbuk-Myon, Pyeongtaek city, Kyoungki-do, Korea

BusinessLCD Parts & Kids Sports Business

CapitalKRW46.3B(Approximately U$38.6M)

Employees 255

Web Site www.hicel.com

“Creating a Better Future”Hicel Co.,Ltd

2. History

Sep. 1998 Established Hi-Industry Co., Ltd /Started business of Back Light Sheet for TFT-LCDMar. 1999 Cooperation Enterprise registered with Samsung ElectronicsFeb. 2000 Cooperation Enterprise registered with LG. PHILIPS LCD Co., Ltd (Twins Club)Nov. 2000 Started Ultra-Precision Machining business

1998 - 2000

May 2001 Launched for Lens Mold & Display Module businessMar. 2002 Company name changed into HICEL Co., LtdJul. 2002 Expansion of Manufacturing Capacity of Back Light Sheets (5M Sheets/Month)

2001- 2002

2003- 2004

Jan. 2003 Listed on KOSDAQMar. 2003 Signed supply contract agreement for image sensor module with SamsungOct. 2003 Mass-produced color Back Light Units (Seongnam area, monthly 800,000pcs)Nov. 2004 Expansion of mass-production for color Back Light Unit (Seongnam, monthly 2M)

Jan. 2005 Expanded of M/P Capacity for BLS for LCD·PDP (Pyeongtaek monthly 7M sheets)Mar. 2005 Patent registered of Front Light Unit for Reflective type LCDOct. 2005 Merged with N2A Co., LtdDec. 2005 Patent registered of both side luminous Back Lighting Module & mobile device built-inJul. 2006 Maroos Co., Ltd incorporated into HICEL

2005 - 2006

2007- Present

Feb. 2007 Pyeongtaek(head office) and Seonganm(branch office) are unified.May 2007 Signed Merging contract with Sidus SL/Paid-in Capital IncreaseJan. 2008 Capital Increase (Public Offering)Mar. 2008 Acquired Hyundai Life Boat Co., Ltd (Quota 100%)

“Creating a Better Future”Hicel Co.,Ltd 5

3. Management

CEO & President Jong-sun Yoon

Queensland Univ., Brisbane, Australia (MBA)

Macquarie Univ., Sydney, Australia

Director of planning and management (Good TV Co., Ltd)

President of Ubiqouss, Sydney, Australia

Direct of Planning and Administration (ONSE Telecom)

Overseas Cooperation Div...(Korea Telecom)

Name Title Career

Yang-Gon JinChairma

n

Yonsei Univ.(Master of Economics) KD Oil Inc./Director Hyundai Lifeboat Co.,Ltd/Chairman

Sang-woo Nam COO

Yonsei Graduate SchoolHyundai Engineering and Construction President of DW Controls Co., Ltd

Gyung-hwa Ryu

VP

Seoul National Univ.(Mechanical Design) LG Electronics Co., Ltd Wooyoung Co., Ltd

Gi-young Park Auditor

Seoul National Univ.(Economics)CGF Executive director of Arthur Andersen Co., Ltd Senior Research Engineer of KIET Auditor General of Good TV Co., Ltd

“Creating a Better Future”Hicel Co.,Ltd

4. Business & Organization

BLS Business

CEOCEO

Sidus SL Business

• Technical Sales• Production• Materials Purchasing• Quality Assurance• Product Development

• Kids Sports • Kids Travel • Build-A-Bear • Sports/Distribution • Content-Media

• Finance• Management• Planning• Marketing

Administration

* BLS : Back Light Sheet* SL : Sports & Leisure

II. BLS BusinessII. BLS Business

1.BLS?

2.BLS Market Prospect

3.Products & Technology

4.SWOT

5.Sales

6.Business Prospect

“Creating a Better Future”Hicel Co.,Ltd 8

1. BLS?

Back Light Sheets are key components in a sensitive system of display (LCD,PDP TV & Monitor) which decisively determine the reliability, and efficiency of its system.

Supplying bright & even white lightSupplying bright & even white light

Lightening to LCD PanelLightening to LCD Panel

Protector

Prism Sheet

Diffuser

Reflector

Source of Light

“Creating a Better Future”Hicel Co.,Ltd 9

Continuous growth of Display Panel Market

2. BLS Market Prospect

66,677

42,807

14,607

9,263

2007

<Market Size of Worldwide Display Panel>

(USD M)

2008 2009 2010

59,031

15,352

9,772

81,404

16,135

10,310

112,255

16,958

10,87784,15

5

107,848

140,090

LCD Monitor

LCD TV

Notebook PC

CAGR 16.1%

379.5

81.7

178.8

107.4

2007 2008 2009 2010

105.6

199.6

129.6

121.1

209.9

148.3

141.3

222.9

171.0447.7

493.6

550.8CAGR 13.3%

11.6

12.9

14.3

15.6

OthersLCD Monitor

LCD TV

Notebook PC

<Shipments>(M units)

Source : Displaybank 2008 FPD Market Perspective and Insights

“Creating a Better Future”Hicel Co.,Ltd 10

Market Share of Hicel(15% out of 350M sheets)

2. BLS Market Prospect

(K Sheets)

500 (0.3%)

Total Q’ty: 198,800

Total Q’ty : 356,350

54,200 (32.8%)

1,000 (4.6%)

<Market Demand of BLU, 2008>

<Market Share of Hicel>(K Sheets)

LGD

SSE

BOE

LGD SSEBOE

91,70046%

96,30049%

10,8005%

<Market Demand of BLS, 2008>

165,15046%

169,00048%

10,8006%

LGD

SSE

BOE

“Creating a Better Future”Hicel Co.,Ltd

Expected M/S of HICEL in 2008

LG Display (KOREA) – Expected M/S by Company(%)

LG Display (China and Poland) – Expected M/S by Company[%]

Item SizeTotal Q’ty of

SheetHICEL

M/S of Hicel

Company ( A ]

Company ( B )

Company ( C )

Company ( D )

Company ( E )

NBPC 10"~17" 5,000 2,400 48.0% 1,500 100 1,000 - -

MNT 15"~24" 17,200 5,000 29.1% 4,200 800 4,000 1,600 1,600

TV 15"~55" 12,750 2,000 15.7% 4,000 600 5,000 400 750

TOTAL 34,950 9,400 26.9% 9,700 1,500 10,000 2,000 2,350

Item SizeTotal Q’ty of

SheetHICEL M/S of Hicel

Company ( A ]

Company ( B )

Company ( C )

Company ( D )

Company ( E )

NBPC 10"~17" 73,000 31,000 42.5% 3,000 2,000 10,000 - -

MNT 15"~24" 43,200 12,000 27.8% 12,000 3,000 15,000 200 -

TV 15"~55" 14,000 2,100 12.9% 4,700 500 6,000 500 500

TOTAL 130,200 45,100 34.4% 19,700 5,500 31,000 700 500

(Unit : 1,000 Sheets)

(Unit : 1,000 Sheets)

2. BLS Business Prospect

“Creating a Better Future”Hicel Co.,Ltd 12

3. Products & Technology

Reflector

It reflects the light which is gotten out of the rear side of LDP.

It uses the white foaming PET as the material and enhance the

luminance making the multi-layer air and prevents the optical spot.

Protector

When the user sees the monitor, it diffuses the light weaker in order

for the screen to be natural, stabilizes the color coordination,

protects the structure of prism sheet & BLU from the outside shock

and prevents the contamination which is caused by the foreign

material inflow.

Diffuser

It diffuses the uniform light from LGP to the screen, enlarges the view

angle transmitting the light to the front direction of Prism Sheet &

Pane, reduces the diffusion of bright dot, line and spot on the LGP.

Prism

It is a film for enhance LCD luminance. LCD gets the light to use a

source of illumination(CCFL or LED), because LCD can not light by itself.

This light is distributed a gross area through LGP and is changed the

Surface light source of uniform brightness by using diffuser sheet.

In this process, light efficiency come out from a early source of

Illumination is raised less and less. It is changed side light into front

light and is concentrated the emitted light to enhance luminance by

using Prism sheet. 　

“Creating a Better Future”Hicel Co.,Ltd 13

Precision Cutting

Use various molds according to product specification.Establishment of small quantity batch production.When cut Roll, Sheet and piece, the allowable tolerance is within(±0.15mm).

Mass production, High-speed and Precision printing.

Reduce the time (within a week) by making and developing the Design and printing plate itself.

Combination and Preparation of Ink & Additive.

Ink Preparation Technology

Light Control/ Pattern Design

Printing Technology

3. Products & Technology

Design & Drawings

Design & Drawing for a wooden pattern and Mold has been developed by our

highly skilled technicians using the latest technologies and experienced knowledge.

“Creating a Better Future”Hicel Co.,Ltd 14

Increasing TFT-LCD Market More Demand for Notebook Demand of Printing items are increased More opportunity for Prism Sheet Cutting

Printing Quality

- Operating own plate Making Team

- Having many High-Speed printers High Market-Recognition Good Relationship with Film makers Operating Outsource contractors

4. SWOT

SS trengthtrength

OO pportunitypportunity

Poor price competitiveness

with Chinese manufacturers

WWeaknesseakness

Competitors’facilities setup in China Pressure on lowering Price Tougher quality Requirement

TThreathreat

“Creating a Better Future”Hicel Co.,Ltd 15

Sales trend of latest 3 yrsQuarterly sales trend of latest

3 yrs

(USD M)

(USD K)

5. Sales

2006 2007

32.6Q1 Q2 Q3 Q4

2008(E)

38.5

7.36.7

8.5

9.4

8.28.6

8.0 7.8 Drastic increase in 2008

2007 2008(E)2006

9.4 9.5 9.9 9.6

Operating Profit

720780

992

247

Q1 Q2 Q3 Q4

300

570

-92

199

2007 2008(E)

2.2%

31.9

18.1%

(USD M)

“Creating a Better Future”Hicel Co.,Ltd 16

5. Sales

ResultStatus1. LGD

a. Increased orders from overseas customers (RADIANT,

CORETRONIC)

b. Focused sales capacity on LGD

c. Extended customers and enabled us to manage monthly sales

volume

d. Enhanced relationship with Kolon and provided prism sheet to

to Kolon

e . Enlarged sales volume for Doris Sahan under strategic

alliance.

(TPL123, E6ZL)

2. Samsung : All Orders from SSE given to Alpha and Sejin TS. 3. BOE: Hold all relation with BOE sub-contractors due to their

financial crisis.

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

Amount2,00

0

2,17

5

2,68

3 2,233 2,200 2,217 2,325 2,617 2,292 2,250 2,133 2,083 27,208

Shipment3,67

5

4,00

8

4,92

6 4,086 3,963 4,666 4,871 5,248 4,525 4,295 4,560 5,109 53,932

(USD K, K Sheets)

Sales record in 2007

1. SSE applied all transaction SCM system. Then,

Hicel transferred major sales volume to LGD.

2. Increased orders from China due to increase of

Chinese customers

3. Secured quality competitiveness on printing

items.

4. Awarded Best Supplier by LGD

“Creating a Better Future”Hicel Co.,Ltd 17

6. Business Prospect

On quantity basis of Big-sized BLU, CAGR 19.25% and higher growth are expected

Growth rate of Notebook PC would be CAGR 16.2% and LGD has expanded their demand on printing items which we are competitive.

TFT-LCD Panel manufacturer has completed or transferred their factories to China for module.

LCD Size of Notebooks have been widened.

LCD for TV has definitely been bigger, 50s inches. Key issues for big-sized BLU makers are enhancing ODM, localization and R&D on LED BLU.

Expectation in 2008

“Creating a Better Future”Hicel Co.,Ltd

18

6. Business Prospect (3years)

Item

2008(E)2009(E

)2010(

E)1Q 2Q 3Q(E) 4Q(E) Total

Revenue 7,515 8,637 6,693 10,94333,78

834,764 36,509

Cost 6,243 7,368 5,230 9,04927,89

028,694 30,130

Gross Profit 1,272 1,269 1,463 1,894 5,898 6,070 6,379

Selling & Administrative

Expenses765 625 773 783 2,946 3,025 3,092

Operating Profit

507 644 690 1,111 2,952 3,045 3,287

(USD K)

III. Sidus SLIII. Sidus SL BusinessBusiness

1. Littles Business

2. Build-A-Bear

3. Sports Business

4. Business Plan in

2008

“Creating a Better Future”Hicel Co.,Ltd 20

• Age group is 4 to 13. • Manage various programs every weekend.• Manage little sports group ( infant education + sports training course)• Made an exclusive gym for children to be designed• according to a stature, weight and activity of children • Manage various camps during the vacation. (Leadership camp, Ski camp, Confidence camp…)

The first and largest scale sports center only for kids in Korea( Suji) Plan to establish new centers in the major 10 cities of Korea until 2008. Supply a various activity such as the leisure, sports, culture experience etc. and Kids Well-being can be improved life’s value of children.

1. Littles Business

Littles World

Operation

“Creating a Better Future”Hicel Co.,Ltd 21

Make profits because of the first swimming pool (Littles Swimming in Apgujeong-dong) for children ONLY. The swimming pool for Kids (depth 0.8~1m, length 25mⅹ5 lanes) The water temperature is always maintained 32 degrees.

1. Littles Business

Littles Swimming

• Mummy and Baby - It is a program which is felt the love between mummy and baby.• Class for 4 to 5 - It is a program for getting rid of fear by dabbling in water.• Class for an infant• Class for a elementary school student - It is a program which is learnt easily and quickly with a handful of men.• Individual lesson/ Masters Class

Operation

“Creating a Better Future”Hicel Co.,Ltd 22

• Age group is 7 to 13 (7 to 8 / 9 to 10 / 11 to 13)• Progress the program four times a month from basic to higher skill by a growth development.• Assign two personal trainers each class. (The regular personnel of class is 20.) • Various camp related to soccer during the vacation.• Manage a soccer club regionally by dividing Seoul.

Soccer classes (“Littles Soccer”) for children with world cup star ‘Chun-soo Lee’ Combine Know-how of children sports and leisure business from Sidus SL with commercial value of Chun-soo Lee. Have a plan to manage the soccer classes for children nationally by starting from Seoul.

1. Littles BusinessSoccer Club ‘Chun-Soo

LeeFC’

Operation

“Creating a Better Future”Hicel Co.,Ltd 23

The top ten of the U.S.A toy distribution. Opened 276 shops in U.S.A and Canada etc. Raise app. U$30M sales from six shops in Japan. Plan to open 16 branch offices in the major cities such as Coex mall, Apgujeong etc. Cooperation strategically with a famous brand such as Spiderman, Superman, Hello Kitty and Disney etc.

2. Build-A-Bear

Build-A-Bear Workshop

• Immense customer base - Family having a child (1 to 13) - Secondary school girls in teenager - 20~30 lovers preparing special gift. - Group and mania related to children • High revisit rate of Customer - Average 60% revisit rate - 80% of revisit customer has a purpose and a plan to visit in advance.• Continuously develop an additional brand. - Strengthen the core competence in entertainment field. - Intend to a retail store.• Progress a various public program given by BABW - Set up a firm image as a Good Company - Progress Stuffed with hugs TM, Huggable Heroes etc.

Characteristics

“Creating a Better Future”Hicel Co.,Ltd 24

• Swimming – Mix a group training with an individual lesson. Providing a course in a small number of people.• Aquarobics – A new type of sports that integrates a swimming with an aerobic• Fitness – Equip a various machinery in wide space which is able to exercise. A systematic training by a personal trainer.• GX Program – Manage a various program such as Yoga, Jazz dance, Taebo, girl’s hip-hop, child ballet etc.• Cultural Classes – Culture, Taste, Health, Children Education program for all age groups.

The space of sports for all (1,000 pyeong) in the cause of a local resident. Progress a various program and event by combining sports with entertainment. Manage Ahyeon Sports center and Hongje Sports center.

3. Sports Business

Sports Center

Operation

“Creating a Better Future”Hicel Co.,Ltd

25

4. Business Plan in 2008 (3years)

(USD K)

item

2008(E)2009(E

)2010(E

)

1Q 2Q 3Q(E) 4Q(E) Total Total Total

Revenue 1,050 1,033 1,074 889 4,046 6,770 9,852

Cost 1,293 1,348 967 693 4,301 4,739 6,627

Gross profit -243 -315 107 196 -255 2,031 3,225

Selling & Administrative

Expenses376 438 437 177 1,428 1,579 1,594

Operating Profit -619 -753 -330 19 -1,683 452 1,631

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