Investor Presentation

Jan 2 0 1 2

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Company overview

Total number of shares: 52,066,718 (Common Stock)

Jangjin Kim, CEO & President

Head of Offshore at Sungjin[2009~]

Managin directorof DSME

Hosub Kim, President

Head of sales marketing[2011~]

Vice President of Posco E&C

Name Sungjin Geotec Co., Ltd.

CEO Jangjin Kim

Date of incorporation June 1989

Listing KOSPI on Nov 29, 2007 (051310 KS)

Number of employees 600 (As of Dec 2010)

Business Manufacturing of heavy industry system

components for industrial/petrochemical

plants, power generation,Module&Skid,

and shipbuilding & marine engineering

General Shareholding

Key management Financial overview (KRW billion)

Yongho Sohn, CFO & Vice President

Executive vice President of

POSCO Specialty Steel

2007 2008 2009 2010

Revenue 361.7 520.1 380,1 370.6

Gross profit 44.4 94.9 -11.3 12.2

EBITDA 39.9 87.2 -9.6 1.8

EBITDA margin 11.00% 16.80% - 0.5%

EBIT 29.6 74.8 -26.3 -12.0

EBIT margin 8.20% 14.40% - -

Net income 10.4 -191 -6.4 -11.8

Net income margin 2.90% - - -

Total assets 382.6 682.1 588.9 586.3

Total liabilities 222 672.4 554.5 434.6

Total shareholders’

equity 160.6 9.7 34.4 151.7

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shareholder

breakdown rate(%) Note

POSCO 12,345,110 23.7%

POSCO E&C 4,848,400 9.3%

J.D.Chun et al 10,049,875 19.3%

KDB 6,979,927 13.4%

Samsung En 5,206,671 10.0%

Other 12,636,735 24.3%

Total no of

shares 52,066,718 100.00%

Shareholder breakdown

2012.01.31

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POSCO Family

Creating Another Success Story POSCO

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Business overview: Leading energy & industrial plant

facility manufacturer

Industrial Plant

Big tower

Column

Reactor

Tower

Module & Marine

engineering

Module

FPSO module

Offshore oil & gas plant

Stern and stem blocks

Pontoon module

Power/Desalination

HRSG1

Manifold

Evaporator

Oil & Gas/Petrochemical Other

Heat exchanger

Spherical tank

Pressure vessel

Scrubber

1 Heat Recovery Steam Generator

2010 sales of

KRW374.4bn

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Business overview

Industrial Plant

Quality based service in providing larger and heavier industrial/petrochemical plant modules

Recognition by global customers including oil majors, engineering firms and EPC1 contractors on product

quality & industry leading technology

Strong growth driven by positive outlook of its downstream businesses and flexibility to shift product mix

Completion of major capex & timely R&D investment to enhance both production quality and capacity

Universal facility to produce a full range of products for diverse industrial plants, and capacity to manufacture up

to 5,000 ton towers

Others

Heat

Exchanger

Pressure

Vessel

Column

Reactor

Scrubber

Spherical

Tank

Tower

Big Tower

1

1 Engineering, Procurement and Construction

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Business overview

Module & Marine Engineering - 1

Specialized in technology-driven oil sand plant module(KOSP)

Annual production capacity: 225,000 ton

Expanding semi-rig pontoon & column production

Entry into floater components (i.e., FPSO1 topside module)

Plan to produce turret and deep sea facilities

2

1 Floating, Production, Storage and Offloading

SEMI-RIG

Pontoon

COLUMN

Pontoon/

COLUMN

Jack-up Rig

Onshore

Module

FPSO

Module

Turret

deep sea facilities

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K O S P ( K e a r l O i l S a n d s P r o j e c t )

Fabrication

1st phase 1st~5th phase Notes

Project size(barrel per day) 100,000 500,000

Every other year

construction of

plants Volume(‘000 tonnes) 20 100

Contract price 250 1,250

Project period Oct 9 – Jul 11 By 2020

Business overview

Module & Marine Engineering - 2 2

Load out Site Installation Transportation

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Business overview

Power generation/Desalination

HRSG

Transmission

tower

Evaporator

Desalination & power plants

Equipped with core technology to establish stable production capabilities

Key supplier to all three major HRSG engineering companies, and increasing HRSG market share

One of 2 MED1-type evaporator suppliers to SIDEM, a specialist MED arm of Veolia Water Solutions & Technologies

Increasing desalination facility market share by producing MED-type evaporators

Bundling opportunities with industrial/petrochemical plant orders

3

1 Multi Effect Distillation

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Reactor Structure Assembly (RSA) Operational status of Research Reactors*

The number of Research Reactors for the operation period

Reactor structure, Beryllium Reflector, CRDM, SSDM, Graphite

Reflector, Beam port assembly, Thermal Column, etc..

-Project name : JRTR -Site : Jordan -Client : Jordan Atomic Energy Commission

-Purchase date : February 2011 -Thermal power : 5MW -Description

JCNR RSA

Business overview

Power generation/ Research Reactor 3

Operation Periods

Operational status of Research Reactors

N

U

M

B

E

R

Status Developed Countries Developing Countries

Cancelled 1 4

Operational 148 91

Shut down 183 21

Decommissioned 194 16

Temporary shutdown 8 5

Planned 1 1

Under construction 2 1

Unverified information 0 1

Total 537 140

*Source: IAEA

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1-1. Steel material for energy field to increase for SGT’s diversification of energy business

1-2. Improving the SGT’s competitive power of desalination plant business through establishing a strategic

alliance with POSCO for Duplex

1-3. Improving the competitive power of casting facilities & heavy thickness Plate through establishing a strategic

alliance with POSCO and POSCO SS

1-4. Enhancing the delivery date and sales power through supplying HRSG’s Tube capa by POSCO

1-5. Securing the stable finance & expanding sales through the support from POSCO

SGT

strategy/finance

support

High value-

added steel

market

development

Sales power

reinforcement

by affiliates

cooperation

EPC business

expansion with

affiliates

New energy

business

cooperation

2-1. Securing the steels with bulk purchasing for oil sand plant to meet the requirements of clients (e.g. Major oil

companies)

2-2. Expanding the demand base through the conjunction development of high value-added materials for Energy

plant

2-3. New demand creation by producing shape steel for marine & offshore plant

2-4. Understanding the oversea plant market trend & the order-receiving activities of EPC companies through SGT

to cope actively with steel demand

2-5. Developing intercontinental transport pipe market through the conjunction development of UOE* pipe

3-1. Expanding to supply the raw material to SGT for ‘Iron ore’/’Power’/’Petrochemical’ plant

3-2. Increasing sales and building up the experiences through sharing client network and oversea sales agents

3-3. Sharing the SGT’s fabrication (Infra) & harbor facilities

3-4. Cross-selling of main product between POSCO Plantec & SGT

4-1. Obtain orders of small-mid sized oil refining & petrochemical plant (oil & gas, refining & petrochemical, oil sand)

under USD 500 million with affiliates

4-2. To be pushed forward the Nuclear plant business with affiliates

4-3. Developing the desalination business model such as package deal type combined with financing and O&M

4-4. To be pushed forward the Power plant of package deal type combined with overseas IPP business and group EPC

business

4-5. To be pushed forward the iron ore processing plants business by using the abilities of Group EPC & SGT’s facilities

with affiliates

5-1. To be pushed forward the wind power business with the affiliates after the value chain completion

5-2. To be pushed forward the generation of electric power from tidal currents R&D & business with affiliates

Business

growth

(‘10~12)

Dealing with

affiliates for

New market

development

(‘10~18)

New business

(‘15~’18)

Note: *U-ing, O-ing, Expanding

Business overview S y n e r g i e s w i t h P O S C O 4

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Strategically located near major ports, Sungjin is the

only player who can supply large-size products

Factory 1

Factory 2

Factory 3

Factory 4

57,638m2

Owned

Within 5km radius of Ulsan and

Onsan ports

178,282m2

102,570m2 owned and 75,712m2

leased

Equipped with own pier

104,431m2

Owned

Within 2km of Onsan Port

102,313m2

Leased

Equipped with own pier

64,091m2

Leased

To be equipped with own pier

Seoul

Ulsan F1

F3 F2

F4 Onsan

Port Ulsan

port

F5

Within 5km radius

Factory Area/ownership/port

Factory 5

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Investment highlights

Continued strong growth in its downstream industries

1

Operational flexibility across different

industries and products 2

Superior production facility and advanced

core technology 3

Completion of capacity expansion and leading technology

4

Stringent quality control and recognition by global customers

5

Improving profitability with focus

on margin improvement 6

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Plant Power/Desalination Moudle & Marine

Flexibility in capacity allocation across different

product groups

SungJin Geotec’s flexible production process allows for

dynamic product mix change to meet market demands

6 5 4 3 1 2

Sales mix trend (%) Key specifications of factories

1 Includes headquarter employees

Factory 1 Factory 2 Factory 3 Factory 4 Factory 5

Production

area

57,637m² 178,282m² 104,431m² 102,313m² 102,313m²

Key products .Petrochemical

Plant

.Shipbuilding

blocks

.Module

.HRSG .Column

.Reactor

.Evaporator

.Module

Production

shifting

Universal Universal Universal Universal Universal

Key facilities .Specialized

welding

facilities

.Pier

.Moving

shelter

.Crane

.Moving

shelter

.Pier

.Moving

shelter

.Pier

.Crane

6 5 4 3 2 1

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Superior production facility and advanced

core technology

Specialized overlay welding capability

of high alloys (Cr-Mo-V, Titanium, etc.)

Higher productivity and reduced

production time

High Alloy welding technology

Sungjin is the only player which

has 3 factories with piers

Closely placed with key heavy industry

players in Ulsan, one of the largest

industrial cities in Korea

Strategically located

production facilities

Moving shelter

Sungjin has 14 moving shelters in

5 factories which allows the

company to produce larger

products even under inclimate

weather conditions

6 5 4 1 2 3

SungJin focuses on

manufacturing high-value

added products with its

competitive production

facility and

industry-leading

technology

6 5 4 3 2

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Stringent quality control and recognition

by global customers

Maintaining the highest quality has been a key factor driving Sungjin’s growth

Continued partnership with leading global customers such as Hyundai Heavy, Chiyoda, NEM and Bechtel

Securing additional industry leaders as our customers such as Sidem (Evaporator) and Essar (Petrochemical reactor)

Regional quality certification to expand global customer base

6 1 2 3 4 5

Top 10 customers in 20101 Major international certifications

ASME-N ASME-NA ASME-NPT ASME-U

ASME-R ISO 9001 ISO 14001 OHSAS18001

KEPIC(MN) PED “H” Module SEML KEPIC(SN)

1 As of December 2010

4 6 5 4 3

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Order Backlog Orders

Wbn. Wbn.

CAGR

21.9% 274.6

439.7

586.9 606.5

424.1

CAGR

11.2%

Order & Order Backlog

6 5 4

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Financial highlights – Historical financials

Income statement (KRW billion)

2005 2006 2007 2008 2009 2010

Sales 181.7 214.9 361.7 520.1 380.1 370.6

Cost of goods sold 167.1 194.1 317.3 425.2 391.4 358.4

Gross profit 14.7 20.7 44.4 94.9 -11.3 12.2

Gross profit margin 8.1% 9.6% 12.3% 18.25% - -

Selling and administrative expenses 8.1 10.1 14.8 20 15 24.2

Operating income 6.6 10.6 29.6 74.9 -26.2 -12.0

Operating income margin 3.6% 5.0% 8.2% 14.40% - -

Non-operating income, net 0.8 8.1 -14.3 -306.6 87.8 25.1

Interest expense, net 3.0 2.9 5.7 -8.2 -20.6 -28.6

Foreign currency exchange gain, net -0.1 -0.8 0.1 -1.5 9.8 2.2

Foreign currency translation gain, net 3.0 1.4 -2.0 -14.7 -0.1 -5.2

Currency options transaction gain, net -0.7 2.4 2.6 -76.1 -6.0 9.8

Valuation of currency options gain, net -0.1 4.0 -8.5 -330.9 49.5 0.1

Ordinary income 7.3 18.8 15.4 -231.7 4.5 -41.8

Ordinary income margin 4.0% 8.7% 4.2% - 1.2% -

Income tax expense 1.8 5.5 5.0 -40.7 10.8 -29.9

Net income 5.5 13.2 10.4 -191.0 -6.3 -11.8

Net income margin 3.0% 6.2% 2.9% - - -

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Financial highlights – Historical financials (cont’d)

Balance sheet (KRW billion)

2006 2007 2008 2009 2010

Cash and cash equivalents 32.9 56.1 17.9 34.0 18.6

Trade receivables, net 85.8 188.3 265.2 285.3 295.5

Inventories 3.7 7.4 26.6 14.6 18.5

Other current assets 16.9 12.7 110.1 40.5 14.6

Total current assets 139.3 264.5 419.8 374.4 347.2

Property, plant and equipment, net 70.5 104.7 207.7 194.9 189.8

Other non-current assets 7.8 13.4 54.7 19.5 49.3

Total non-current assets 78.3 118.1 262.4 214.4 239.1

Total assets 217.6 382.6 682.2 588.8 586.3

Trade payables 33.8 59.3 70.2 38.4 67.1

Short-term borrowings 44.7 104.9 190.3 36.8 12.0

Current portion of long-term debt 23.9 5.2 8.2 0.2 104.1

Other current liabilities 15.8 26.4 162.3 181.6 46.7

Total current liabilities 118.2 195.8 431.0 257.0 229.9

Long-term borrowings 10.1 21.3 38.1 276.1 203.8

Other non-current liabilities 1.7 4.9 203.3 21.3 0.9

Total non-current liabilities 11.8 26.2 241.4 297.4 204.7

Total liabilities 130 222 672.4 554.5 434.6

Total shareholders’ equity 87.7 160.6 9.7 34.4 151.7

Total liabilities and shareholders’ equity 217.6 382.6 682.1 588.9 586.3

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Mid-term strategic objective

On track to achieve KRW1trn in sales by 2012

Capacity

Investment in major capital

expenditure will be completed

by 2010

Capacity expansion sufficient

for the mid-term strategic goal

has been secured

Profitability

Management focus on

margin improvement

Improving EBIT margin from

larger/ heavier product orders

New growth opportunities

Product portfolio shifting

Aggressive expansion into new

growth businesses

Module and Skid

— FPSO

— Offshore oil & gas facilities

MED-type desalination

evaporator