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Leading Tomorrow

Today

doosan Heavy industries & Construction

2010

annual report

Doosan Heavy Industries & Construction 2010 Annual Report

LeADIng TomoRRow

Act Proactively ... Provide Completely ... Share Passionately ...03 FinancialHighlights

04 YearinReview

06 CEOMessage

08 ManagementTeam

Act Proactively

12 Power/Water/GreenEnergy

18 DoosanWorldwideToday

Provide Completely

20 GlobalEPCContractor

22 ReviewofOperations

Share Passionately

42 Share

44 Protect

46 Collaborate

48 FinancialStatements

60 AbouttheDoosanGroup

61 GroupAffiliates

62 GlobalNetwork

Financial

Highlights

Our2010operatingperformancesawusmovesolidlybackintotheblackaswecontinuedtogainmomentumin

globalpowerandwatermarkets.Whilerevenuesweredown1.6%largelyduetoprojectdelays,orderssoaredover

130%aswewonaremarkablenumberofmajorpowerandwaterprojectsspanningtheglobefromtheMiddleEastto

SoutheastAsia.Althoughour2011ordertargetismoreconservativethanourrecord2010performance,webelieve

ourstrongmulti-yearbacklogandsharpenedorganizationalfocusonEPCandpowerequipmentcombinedwithop-

erationalexcellencewilldrivethenextwaveofprofitablegrowthin2011andbeyond.

2010 2009 2008

ToTAL AsseTs 9,226 9,176 9,919

ToTAL sHAReHoLDeRs’ equITy 3,537 3,319 3,382

Revenues by busIness gRoup

epC 2,732 2,704 2,450

poweR 1,191 1,537 1,722

nuCLeAR poweR pLAnT 1,226 780 573

wATeR 418 630 356

CAsTIng & FoRgIng 611 628 609

ToTAL Revenues 6,178 6,279 5,709

opeRATIng InCome 447 404 474

neT InCome 111 (328) (66)

eARnIngs peR sHARe In KRw 1,238 (3,748) (765)

DIvIDenDs peR sHARe In KRw 1,238 - 500

opeRATIng InCome in KRw billions

2008 2009 2010

404

474 447

TomoRRow ToDAy

oRDeRs in KRw billions

2008 2009 2010

5,621

8,421

12,954

At Doosan Heavy Industries & Construction,

our vision is to be a global leader in power and water.

Backed by nearly five decades of experience as a partner

for growth and progress around the world, we are

committed to helping our customers meet the challenges

and opportunities of the future as we act proactively,

provide completely, and share passionately to lead

tomorrow today.Revenues in KRw billions

2008 2009 2010

6,1786,279

5,709

02 0302

February 2011

YanbuPhaseIIMEDDesalinationProjectOrder

WewinthisUSD124millionEPCprojectfromSalineWaterConver-

sionCorporationfora15MIGDMEDdesalinationunitinSaudiAra-

bia.Thecollaborationwillresultintheworld’slargestsingle-unit

multi-effectdistillationfacilitytodate,positioningusforgrowthin

thatemergingtechnologyfield.

Year

in

Review

February 2010

DoosanPowerSystemsLaunch

January 2010

Raipur-ChhattisgarhThermalPowerProjectOrder

April 2010

RasAzZawrHybridDesalinationProjectOrder

228 mIgD

1,370 mwe

WewinthisUSD1.76billionEPCprojectfromSalineWaterConver-

sionCorporationtobuildtheworld’s largestdesalinationplant

todateinSaudiArabia.The228MIGDhybridproject—160MIGD

multi-stageflashand67.5MIGDreverseosmosis—willmeetthe

potablewaterneedsof3.5millioninthecapitalofRiyadh.

September 2010

Rabigh2ThermalPowerProjectOrder

2,800 mwe

WewinthisUSD3.5billionEPCprojectfromSaudiElectricityCom-

pany.Theprojectwillincludefour700MWeoil-firedplantsandis

scheduledforcompletionin2014.

WewinourlargestpowerprojecttodateinIndiafromGMREnergy.

TheUSD1.1billionEPCprojectwillincludetwo685MWecoal-fired

unitsandisscheduledforcompletioninthesecondhalfof2013.

WeestablishthisUK-basedholdingcompanytooverseetheopera-

tionsofDoosanBabcockoftheUKandŠkodaPoweroftheCzech

Republic.WealsoestablishDoosanPowerSystemsEuropeand

DoosanPowerSystemsAmericatogrowourbusinessinthosekey

markets.

July 2010

FirstAPR1400®ReactorShipment

1,400 mweWeshipourfirstthird-generationreactorforShin-KoriUnit3 in

Korea.Offering40%moregeneratingcapacityanda50%longer

servicelifethanthepreviousOPR1000units,theAPR1400®design

willpowerfuturenuclearplantsintheUAEaswellasKorea.

December 2010

YeongheungThermalPowerProjectOrder

1,740 mwe

WesignacontractwithKoreaSouth-EastPowertosupplytwo

870MWeultra-supercriticalboilersforYeongheungUnits5~6.We

completedYeongheungUnits3~4in2009.

December 2010

MongDuongIIThermalPowerProjectOrder

WewinthisUSD1.2billionEPCprojectfromAES-VCMMongDuong

PowerCompanyinVietnam.Theprojectwillincludetwo620MWe

coal-firedplantsandisscheduledforcompletionin2015.

MongDuongIIThermalPowerPlant

May 2010

JebelAliMThermalProjectSafetyMilestone

WesetanewsafetystandardfortheKoreanconstructionindustry

bycontinuingaperfectsafetyrecordonthisproject launchedin

theUAEin2007,surpassing20millionman-hourswithoutamajor

safetyincident.

20 million man-hours

March 2011

WinDS3000™WindTurbineCertification

WesecuretypecertificationfromDEWI-OCCofGermanyforour

first3MWoffshorewindturbine,pavingthewayforustoenterthe

globalwindpowermarket.

September 2010

Man-MachineInterfaceSystemCompletion

Wecompletedevelopmentofanext-generationMMISfornuclear

powerplants.Flexibleenoughtohandlecontrolofavarietyofoth-

erindustrialfacilities,thetechnologymeetsthehigheststandards

forreliabilitywhileimprovingsafetyandconvenienceoverexisting

solutions.

mmIs

DoosanBabcock

ŠkodaPower

DoosanPowerSystems

January 2011

ChennaiWorksAcquisition

WeacquiretheboilermanufacturingoperationsofAE&EofAustria

inChennai,IndiaforEUR20.5million.Theacquisitiongivesusthe

facilitiesandpersonnelthatareessentialtoexpandingourpres-

enceinthishugegrowthmarketforthermalpowergeneration.

Doosan Chennai Works

Yanbu SaudiArabia

04 0504

Weachievedremarkable resultsacrossourentire

businessportfolioin2010,winninganumberofma-

jorpowerandwaterprojects inkeymarketsacross

theMiddleEast, India,andSoutheastAsia.Among

theyear’shighlightswerethesigningofthemajor

equipmentcontractfortheBrakanuclearpowerproj-

ectintheUAE,thebookingoftheRasAzZawrhybrid

desalinationprojectandRabigh2 thermalpower

projectinSaudiArabiaaswellastheRaipurthermal

powerprojectinIndia,andourselectionbythegov-

ernmentofVietnamasapartnerinlocalizingproduc-

tionofcoal-firedpowerplants.

Inthefirsthalfof2011,wemergedourPowerPlant

andConstructionbusinessgroupsandreorganized

themintotwonewspecializedgroupstostrengthen

ourpowerEPCandequipmentbusinesses,generate

greatersynergies,anddriveprofitablegrowth.Our

newEPCbusinessgroupstrategicallybringstogether

thecoreengineeringandconstructionexpertisewe

haveaccumulatedoverthedecadestoenhanceour

capabilitytohandlemajorEPCprojectsonourown.

Likewise,ournewPowerbusinessgroupbringsto-

getherthecoretechnologiesanddistinguishedtrack

recordsofourboilerandturbineOEMaffiliatesDoo-

sanBabcockandŠkodaPowertopositionourpower

equipmentandservicebusinessesfordramatically

greatergrowthinthecomingyears.

Theaboveeffortshavealreadybeguntoyieldresults,

enablingustowinequipmentordersfortheYanbu

PhaseIIthermalpowerplantprojectinSaudiArabia

andthePocheoncombined-cyclepowerplantproject

inKorea.Wehavealsoacceleratedouradvanceinto

India—acountrythatisnowemergingastheworld’s

fastest-growingmarketforthermalpowerplants—by

acquiringlocalboilermakerAE&EChennaiWorksin

January2011.Wealsosetthestageforouradvance

intotheglobalwindpowermarketinFebruary2011

bywinninginternationaltypeapprovalforourWinDS

3000™3MWoffshorewindturbinefromDEWI-OCCof

Germany.

Thesearejustafewofthewaysthatwecontinueto

ceaselessly innovateaswesolidifyourpositionas

agloballeaderinpowerandwater.Thankyouonce

again foryour interest inandsupport forDoosan

HeavyIndustries&Construction.Wehopeyou’lljoin

usaswecontinue togainglobalmomentumand

bringmorepowerandwatertotheworld.

CEO

Message

we buILDyouR TomoRRowToDAy

on beHALF oF THe enTIRe DoosAn HeAvy InDusTRIes & ConsTRuCTIon FAmILy, I Am pLeAseD

To RepoRT THAT we ReCoRDeD ouR besT oRDeR peRFoRmAnCe To DATe In 2010. ouR FoCus In

2011 Is on geneRATIng pRoFITAbLe gRowTH As we ResTRuCTuRe ouR oRgAnIzATIon To ex-

pAnD ouR poweR equIpmenT busIness, upgRADe ouR gLobAL busIness sysTems, AnD seT ouR

sIgHTs on even gReATeR goALs As A gLobAL LeADeR In poweR AnD wATeR.

President&CEOGeewon Park

06 0706

LeADeRsHIp

Keysun HanPresident&COO“Wearepursuingprofitablegrowththroughoperationalexcellenceinitiatives.Wearealsoworkinghardtobuildanopencorporatecultureandfostercommunicationthroughouttheorganization.Andsincethecompetitivenessofourpartnersisultimatelyourown,wearestrivingforwin-wingrowthwiththem.”

Habang KimExecutiveVicePresidentNuclearPowerPlantBusinessGroup

“Ourgoalfor2011istobethegloballeaderinmajornuclearequipmentaswesecureourplaceasakeyplayerinthenuclearrenaissance.Wewillbeturningourattentiontoachievingtotaloperationalexcellenceaswefocusondeliveringsuperiorqualityequipmentontimeandcompletingthecapacityexpansionprojectlaunchedin2008bytheendof2012.”

Myungwoo KimExecutiveVicePresidentManagementDivision

“WearecontinuallyupgradingourEHSsystemtoensureourworksitesaresafeandaccident-free.Westrivetoupholdourtraditionoflaborpeacethroughcommunicationandcooperationbasedonthetrustwehavebuiltovertheyears.Wearealsoactivelyfulfillingourcorporatesocialresponsibilitybyactivelycontributingtolocalcommunities.”

Huntak KimExecutiveVicePresidentEPCBusinessGroup

“Tappingintoourexperienceofthepastyearsintheengineeringandconstructionbusinesses,wewillbuildamoreindependentorganizationalstructureandsecurecompetitivenessinordertopromoteprofitablegrowthinourEPCbusiness.”

Seokwon YunExecutiveVicePresidentWaterBusinessGroup

“Whiletheglobaleconomyremainedsluggishin2010,weprovedonceagainwhywearetheworldleaderinthermalseawaterdesalination.WedefeatedthecompetitiontowintheRasAzZawrproject,ahybridMSFandROplantthatwillbetheworld’slargesttodateat228MIGD.Ourwinofthe15MIGDYanbuMEDprojectinearly2011showsthatweareatotalsolutionproviderinthetop-threedesalinationtechnologies.”

Dongsoo Suh ExecutiveVicePresidentPowerBusinessGroup

“AsanOEMboastinganexcellenttrackrecordandcoretechnologyintheareasofboilerandturbinemanufacturing,wewillbeleadingthegrowthofthecompanybyexpandingourequipmentbusiness.Wewillachievethisbydiversifyingouroverseasmarketsanddevelopingcutting-edgeproducts.”

Seokhee KohSeniorVicePresidentCasting&ForgingBusinessGroup

“Intoday’sintenselycompetitivemarket,securinganabsoluteedgeinquality,cost,anddeliveryisbecomingevenmoreessential.Asourcompetitorsracetoexpandtheirmanufacturingandtechnicalcapabilities,wearefocusingondevelopingnewproductswithouruniquetechnicalcapabilitiestogeneratecontinuedgrowthandstableprofits.”

Hyeonghee ChoiSeniorVicePresidentCFO

“Weareupgradingourfinancialmanagementsystemtomeetthestandardsandrequirementsoftheglobalbusinessenvironment.In2011,wewillbesecuringfinancialstabilityirrespectiveofthevolatileinternationaleconomicenvironmentasweactivelysupportbusinessgrowth.”

Seungjoo ChoeSeniorVicePresidentCTO

“OurCorporateR&DInstituteishardatworktocreatevaluebydrivinggrowththroughthedevelopmentofnewtechnology.Wearecurrentlyfocusingonstrengtheningcommontechnologiesandsecuringcompetitivenesstomeetthepowerandwaterdemandsofthefuture.”

AT DoosAn, ouR woRLD-CLAss peopLe, InDusTRy-LeADIng TeCHnoLogy, AnD

unIque mAnuFACTuRIng CApAbILITIes enAbLe us To DeLIveR InnovATIve, besT-In-

CLAss soLuTIons In eACH oF ouR busInesses. THe syneRgy we ARe CReATIng ToDAy

ensuRes THAT ouR RepuTATIon As one oF THe woRLD’s LeADIng poweR AnD wATeR

soLuTIon pRovIDeRs wILL ConTInue To gRow TomoRRow.

Management team

08 0908

Asweentertheseconddecadeofthe21stcentury,globaldemand

forpowerandwaterisgrowingatanunprecedentedpace.Emerg-

ingmarketsareleadingthewayasrapidurbanizationandindustri-

alizationspurinvestmentinthesefundamentalfields.AtDoosan,

wehaveprovenourselvestobeaworthypartnerforgrowthand

progressbyconsistentlydeliveringbest-in-classsolutionsbasedon

extensiveexperienceandadvancedtechnologytohelpmeettoday’s

powerandwaterneeds.Andtomorrow’s.

we ACT pRoACTIveLy

LeADIng TomoRRow ToDAy

10 1110

Power

AtDoosan,weareaglobalplayerinallmajorfieldsofpower

generation—fromconventionalcoal-firedthermalplantsto

third-generationnuclearplants.Overthepastfourdecades,

we’vegrownfromKorea’sprimarysupplierof thermaland

nuclearplantequipmentintoafull-serviceEPCcontractorand

OEMequipmentsuppliertotheglobalpowermarket.Today,

wearealsoanindustryleaderincleancoaltechnologiessuch

asoxy-fuelcombustionandpost-combustioncarboncapture

throughUK-basedDoosanBabcockandourstrategicalliance

withCanada-basedCCSleaderHTCPurenergy,workinghard

toensurethattomorrow’sthermalpowerplantsareasclean

andgreenaspossible.

THe woRLD HAs A Huge AnD gRowIng AppeTITe FoR eneRgy. THe CHALLenge Is To geneRATe IT ReLIAbLy AnD susTAInAbLy. AnD we HAve THe ADvAnCeD poweR TeCHnoLogy To Do jusT THAT.

12 1312

Water

AtDoosan,weare theglobal leader in thermalseawater

desalination.Over thepast threedecades,wehavemas-

teredthescienceofturningoceanwaterintodrinkingwater.

Wepioneered innovativeconceptssuchassingle-module

evaporators—whichdramaticallyreduceprojectleadtime—

aswellashybridplants—whichcombineareverseosmosis

membranefiltrationplantwiththemainthermaldistillation

plantformoreeconomicalwaterproductioninoff-peakand

off-seasonperiods.It’screativethinkinglikethisthatenables

ustoconsistentlywintheindustry’s largestprojectsacross

theMiddleEast.

oveR Two-THIRDs oF ouR pLAneT Is CoveReD by wATeR. THe CHALLenge Is To DeLIveR IT To wHeRe IT Is neeDeD. AnD we HAve THe ADvAnCeD s R

TIon TeCHnoLogy To Do jusT THAT.

14 1514

Green Energy

AtDoosan,weareanemergingplayerinthewindpowerfield.

Overthepastfouryears,wehavedevelopedtheadvanced

WinDS3000™3MWoffshorewindturbinesystem.Builtfrom

thegroundupforsuperiorreliabilityanddurabilityinharsh

offshoreenvironments,thesystemfeaturesasealedcooling

systemaswellasabuilt-incranethatdramaticallyreduces

thecostofmaintenance.TheWinDS3000™isjustthefirstin

a familyofonshoreandoffshorewindturbinesweplanto

launchoverthenext fewyearsasweexpandourportfolio

intothisandotherrenewableenergyfields.

16 1716

THeRe’s An AbunDAnCe oF CLeAn, RenewAbLe eneRgy ALL ARounD us. THe CHALLenge Is To FInD A wAy To eFFICIenTLy CApTuRe IT. AnD we HAve THe ADvAnCeD engIneeRIng TeCHnoLogy To Do jusT THAT.

Doosan Power Systems

E s t ab l i s h ed i n

2010,DoosanPow-erSystems is theleadcompanyinag lobal group offourbusinesses—

DoosanBabcock,ŠkodaPower,Doo-sanPower SystemsAmericas, andDoosanPowerSystemsEurope.ThisUK-basedfirmprovidescompleteplantsolutionsandenergyservicestopowerutilitiesinEuropeandtheAmericas.

Škoda Power

ADoosancompany

since2009,ŠkodaPowerdesignsandm a n u f a c t u r e smodern turb ineandgeneratorso-

lutionsforbothfossilfuelandnuclearpowerplants.ThisCzech-based firmoffers commissioning, retrofit, andmaintenance services for originalŠkodaequipmentaswellasequipmentfromotherselectedmanufacturers.

Doosan IMGB

ADoosancompany

since2006,Doo-san IMGBproduc-esa full rangeofcastingsandforg-ings for thehydro

power, thermalpower,shipbuilding,moldandtoolmaking,andother in-dustries.This Romania-based firmgivesusthefoundrycapacitytogrowaswellasastrategicpresenceintheEuropeanmarket.

Doosan Power Systems India

E s t a b l i s h e d i n

2011,DoosanPow-er Systems Indiaspearheads ouroperations in thisemergingmarket.

CurrentlysupervisingtheconstructionofMundra,Raipur,andotherprojects,thefirmhastheengineering,manufac-turing,andmarketingcapabilities todeliverpowerplantsspecificallyde-signedforthelocalmarket.


ADoosancompany

since2011,DoosanChennaiWorksisacoal-basedboilermanufacturer lo-catedneartheport

ofChennai,oneofthelargestcitiesinsouthernIndia.Majorproductsmanu-facturedat ChennaiWorks includepressurepartsforboilersof300MWorbelow,suchaswaterwalls,coils,andheaders.

Doosan Vina

Officiallyopenedin

May2009,DoosanVinamanufacturesmajor power andwater plant com-ponents including

boilers,heat-recoverysteamgenera-tors,seawaterdesalinationevapora-tors,materialhandlingequipment,andchemical process equipment at a110-hectare site inVietnam’sDungQuatEconomicZone.

Doosan Hydro Technology

ADoosancompany

since2005,Doo-sanHydroTechnol-ogy was named“ D e s a l i n a t i o nCompany of the

Year”byGlobal Water Intelligenceatthe2008GlobalWaterAwards.ThisUS-basedfirmisatotalwatersolutionproviderwithunrivaledexpertiseinre-verseosmosisandmembranetechnol-ogiesforuseindesalination.

Doosan Engineering & Services

DoosanEngineer-

i n g & S e r v i c e s(DoosanE&S) isaspecialized engi-neering companythat was estab-

lishedinSeptember2008inNewJer-seytobolsteroverallengineeringca-pabilities.ThecompanywasfoundedthroughastrategicalliancewithBurnsandRoe,arenownedplantengineeringfirm.

1 2 3 4 5 6 7 8

Doosan Worldwide TodayToday

At Doosan, our global network of sales, engineering, and production plants is building tomorrow, today. Our presence in key markets world-wide enables us to deliver world-class turnkey power and water solu-tions to customers virtually anywhere on the planet.

DoosanPowerSystemsAtlantaOffice

SantiagoOffice

WindsorOffice

DoosanPowerSystemsSãoPauloOffice

PittsburghOffice

SchenectadyOffice

NewJerseyOffice

DoosanHFControls

TampaOffice

7

8

Doosan Hydro Technology

Doosan Engineering & Services

1

Doosan Power

Systems

DoosanBabcock

DoosanPowerSystemsEurope

AbuDhabiOffice

DohaOffice

MumbaiOffice BangkokOffice

TaipeiOffice

JakartaOffice

DoosanVinaHaiphong

BeijingOffice

HanjungPower

ShanghaiOffice

HanoiOffice

DubaiOffice

KuwaitOffice

DoosanWaterDubaiR&DCenter

MiddleEastOperationsCenter

NewDelhiOffice

HyderabadOffice

DoosanHeavyIndustriesJapan

SeoulOffice

FrankfurtOffice

CairoOffice

RiyadhOffice

2 Skoda Power

3 Doosan IMGB

Doosan Power Systems India


6

4

5 Doosan Vina

Headquarters DoosanPowerSystemsAmericas

18 1918

we pRovIDe CompLeTeLy

LeADIng TomoRRow ToDAy

Modern power and water projects are

incredibly large and complex. It takes a

huge amount of experience and expertise

spanning a broad range of technical

disciplines to engineer, manufacture, and

build plants capable of efficiently and

reliably meeting not only today’s needs,

but tomorrow’s. At Doosan, we have

strategically cultivated our capabilities

over the past five decades as we have

transformed ourselves from a competent

equipment fabricator into a full-service

EPC contractor capable of taking on the

world’s largest and most technically

challenging power and water projects.

At DoosAn, we Are one of the worlD’s fAstest-growing engi-

neer-procure-construct contrActors. formAlly lAuncheD

in 2004, our epc business bookeD its first mAjor orDers in

2006 AnD hAs been the cAtAlyst behinD our rApiD growth AnD

expAnsion over the pAst five yeArs. toDAy, we Are focuseD on

becoming A premier globAl epc pArtner, Delivering innovAtive

worlD-clAss solutions AnD services thAt will Drive tomor-

row’s growth.

2010 review

TheglobalEPCpowermarketcontinuedtogeneraterobustgrowthin2010

thankstostrongdemandfromemergingmarketsacrosstheMiddleEast,

India,andSoutheastAsia.Ourlong-termexperienceinthesekeymarkets

enabledustorecordourbestorderperformancetodateofKRW5,786bil-

lion,astrong176%increasefortheyear.Revenueswerealsosolid,rising

slightlytoKRW2,732billion.

KeyprojectwinsfortheyearincludedtheRabighTPP(700MWex4)—the

world’slargestthermalpowerplantprojecttodateintermsofvalue—in

SaudiArabiaaswellastheRaipurTPP(685MWex2)inIndia.Wealsowon

theMongDuongIITPP(600MWex2)inVietnamandwereselectedbythe

governmentofVietnamasthesoletechnicalpartnerforanationalproject

tolocalizeproductionofcoal-firedthermalpowerplants.

2011 outlook

Whiletheglobaleconomicoutlookremainshighlyuncertainduringthe

comingyear,theglobalpowermarketisprojectedtogrowanaverageof

53GWeannuallyduringthe2011to2015period,dramaticallyhigherthan

the29GWeaverageofthepastfiveyears.Weexpecttogeneratesteady

orderandrevenuegrowthincoremarketsacrosstheMiddleEast, India,

andSoutheastAsiaaswecontinuetowinandexecutesomeofthepower

industry’slargestandmostsignificantprojects.

Webelievethedramaticordergrowthwesawin2010isadirectresultof

theexperienceandexpertisewehaveaccumulatedovertheyearsaswe

havebuiltasolidEPCorganizationandoptimizedourprocesses. InMay

2011,wetookamajorsteptowardelevatingourEPCprojectexecutionca-

pabilitiestothenextlevelandlaidthefoundationforacceleratedgrowth

inthiscorebusinessbystrategicallyreorganizingourEPCoperations.Our

newEPCbusinessgroupconsolidatesourcorearchitect-engineeringand

constructioncapabilitiesintoasinglespecializedorganization,pavingthe

wayforgreatersynergyandopportunitiesgoingforward.

EPCBusinessGroup

EPC BuSInESS GrouP

Performance Highlights

OrderssoaredpastKRW5.7trillionin2010aswebookedmajorprojects inSaudiAra-bia,India,andVietnam.Whilerevenuesheldsteadyat justoverKRW2.7trillion,ourre-cordorderperformanceboostedourbacklogtoanewhighofoverKRW8.2trillion.

2010

2009

20082,450

2,732

2,704

rEVEnuES inKRWbillions

2010

2009

20083,045

5,786

2,100

orDErS inKRWbillions

2010

2009

20085,566

8,258

5,090

BACKLoG inKRWbillions

rEVIEW oF oPErATIonSEPC Power NuclearPowerPlant Water Casting&Forging 22 2322

Jebel Ali M CCPP ProjectConsistingofthree670MWecombined-

cyclepowerunits,theJebelAliMproj-

ectisthelargestthermalpowerplant

orderedtodateintheUAE.Scheduled

forcommissioninginlate2011,thisEPC

projectisalsoanexcellentexampleof

ourcommitmenttosafetywithover20

millionman-hoursloggedwithoutan

accident-relatedworkstoppageasof

May2010.

Plant ownerDubaiElectricityandWaterAuthority

Plant Capacity2,000MWe

(670MWex3)

Construction PeriodM1:2007~2011

M2:2007~2011

Portfolio EPCBusinessGrouprEVIEW oF oPErATIonS 24 2524

AT DooSAn, WE ArE A WorLD-CLASS SuPPLIEr oF THErMAL PoWEr GEn-

ErATIon EquIPMEnT WITH MorE THAn 100,000 MWE oF GEnErATInG

CAPACITY DELIVErED To uTILITIES ArounD THE WorLD oVEr THE PAST

THrEE DECADES. ToDAY, WE ArE ExPAnDInG BEYonD FoSSIL-FuEL GEn-

ErATIon AS WE AIM To LEAD THE WAY In THE LoW-CArBon GrEEn EnErGY

TECHnoLoGIES THAT WILL PoWEr THE FuTurE.

2010 review

Wehadanoutstandingyearin2010asorderssoaredover130%toKRW2,568

billion.KeywinsfortheyearincludedtheRabighIITPP(700MWex4)inSaudi

Arabia,BrakaNPP1~2(1,400MWex2)intheUAE,AinSokhnaTPP(650MWex

2)inEgypt,andYeongheungTPP5~6(870MWex2)inKorea.Whilerevenues

fellover22%toKRW1,191billionduetoprojectdelays,wedeliveredequip-

mentfortheMundraTTP(800MWex4) in India,Shin-KoriNPP3~4(1,400

MWex2)inKorea,andGheco-OneTPP(700MWex1)inThailand.

Inrecentyears,wehavesignificantlyenhancedourcompetitivenessbyex-

pandingourengineering,technical,andmanufacturingcapabilitiesthrough

overseasexpansionandstrategicacquisitions.DoosanVinainVietnamhasbe-

comeakeyoverseasmanufacturingbasesincerampingupoperationsin2009.

OuracquisitionofCzech-basedturbinemakerŠkodaPowerin2010meansthat

wenowowncoretechnologiesineachofthethreecorethermalgeneration

equipmentfields—boilers,turbines,andgenerators—openingthewayfornew

businessopportunitiesworldwide.

2011 outlook

WhiletheFukushimanuclearcrisisinJapanisforecasttocooldemandinthe

nuclearpowergenerationmarket,globaldemand forcombined-cycleand

thermalpowerplantsisexpectedtorisein2011.InKorea,wheregovernment

energymixpolicyisfocusingonnuclearaswellasalternativeandrenewable

energy,weplantoexpandourproductportfolioasweaccelerateouradvance

intothewindandintegrated-gasificationcombined-cyclepowerfields.Wealso

expectourgrowinglocalmanufacturingpresenceinIndiaandSoutheastAsia

toenhanceourcompetitivenessinthoseandotherregionalmarkets.

Lookingahead,wearewellpositionedforprofitablegrowtharoundtheglobe.

WiththeintegrationofturbineOEMŠkodaPowerintoourfamilyin2010,we

nowofferafullBTG—boiler,turbine,andgenerator—lineupofthermalpower

generationequipment.Wealsoexpandedourglobalmanufacturingnetwork

inJanuary2011withtheacquisitionofDoosanChennaiWorksinIndia,aboiler

manufacturingshopformerlyownedbyAE&EofAustria.Inadditiontoincreas-

ingourcompetitiveness,theacquisitionensureswemeetthekeylocalmanu-

facturingpresencerequirementforparticipationinIndia’shugepublicsector

supercriticalboilermarket.

PowerBusinessGroup

PoWErBuSInESS GrouP

2010

2009

20081,722

1,191

1,537


2010

2009

20083,434

3,758

2,736


rEVIEW oF oPErATIonSEPC Power NuclearPowerPlant Water Casting&Forging

2010

2009

20081,878

2,568

1,113



OrderssoaredpastKRW2.5trillionin2010aswebookedmajorprojectsinSaudiArabia,theUAE,India,andKorea.WhilerevenuestemporarilydroppedtoKRW1.2trillion,ourrecordorderperformanceboostedourback-logtoanewhighofoverKRW3.7trillion.

26 2726

boilers

Weareaworld-classsupplieroftheindustry’scleanest,mostefficientsolu-

tionsforconventionalthermalpowergeneration.

In2010,webookedtheRabighTPP(700MWex4)project—SaudiArabia’s

largestthermalplanttodate—andtheAinSokhnaTPP(650MWex2)proj-

ect—Egypt’sfirstsupercriticalthermalplant.WealsowontheRaipurTPP

(685MWex2)inIndia,MongDuongIITPP(600MWex2)inVietnam,and

YeongheungTPPUnits5~6(870MWex2)—Korea’slargestthermalplantto

date.MajorcompletionsduringtheyearincludedtheGlowCFBboilerplant

(115MWe)inThailandandaperformanceupgradeprojectatBoryeongTPP

Units1~2inKorea.

hrsgs

Ourhigh-efficiencyD-Topmodularheat-recoverysteamgeneratorsare

usedincombined-cycleandcogenerationplantsaroundtheglobe.Since

enteringthisbusinessin1990,wehavedeliveredmorethan412unitsfor

133projectsin36countries.

AccordingtoMcCoy Power Reports,wehavebeentheworld’sNo.1HRSG

supplierforthelastsixconsecutiveyears,deliveringatotalof149units

duringthe2005~2010period—including22units in2010alone—foran

average15.7%marketshare.Ourorderbookfortheyear includedunits

fortheRasAzZawrCCPP(198MWex10)inSaudiArabia,DgenCCPP(250

MWex3)andUnosugenCCPP(250MWex1)inIndia,OseongCCPP(175

MWex3)inKorea,BarkaCCPP(250MWex2)andSohar(250MWex2)in

Oman,andToulCCPP(250MWex1)inFrance.

turbines & generAtors

Weareagloballycompetitivesupplierofhigh-performanceturbinegensets

withmorethantwodecadesofexperienceindeliveringsolutionsthatset

thestandardforreliability,efficiency,andmaintainability.Asoftheendof

wehavereceivedgensetorderstotalingover56,000MWe.

In2010,webookedgensetordersfortheRaipurTTP(685MWex2)inIn-

dia,RabighTPP(700MWex4) inSaudiArabia,MongDuongIITPP(600

MWex2)inVietnam,andBrakaNPP(1,400MWex4)intheUAE,thelatter

markingourfirstinternationalgensetorderinthenuclearplantsegment.

Theyearalsosawourfirstlargegasturbinesproducedunderlicensefrom

MitsubishiHeavyIndustriesofJapanentercommercialoperationatYeong-

wolCCPP(185MWeF-typex3)inKorea.

mAteriAl hAnDling equipment

WeareKorea’sleadingmakerofhigh-performancematerialhandlingequip-

mentfortheglobalcontainerandbulkhandlingindustries,deliveringturn-

keysolutionstomajorportsandplantsworldwidesince1979.

In2010,webookedinternationalordersfor17cranes, including6RTGCs

and11STSGCs.Majorordersfortheyearincluded2ship-to-shoregantry

cranes(STSGC)forMilitaryOceanTerminalSunnyPointfromtheUnited

StatesNavy,3STSGCsforJawaharlalNehruPort in India,and6STSGCs

and6RTGCsfromKuwaitPortAuthority.Wealsobookedanorderfortwo

3,000-toncontinuousshipunloadersfromKoreansteelmakerPosco.Major

deliveriesfortheyear included4STSGCstoBalboaPort inPanamaand

continuedRTGCdeliveriesasapartofa79-unitorderfromPortofSinga-

poreAuthorityinSingapore.

winD turbines

In2006,wetappedintoourmorethanthreedecadesofexperienceandex-

pertiseinthepowergenerationequipmentbusinesstolaunchdevelopment

ofa3MWonshore/offshorewindturbine.ThehighwindclassWinDS3000™

turbineearnedinternationaltypecertificationinMarch2011,pavingtheway

forourentryintotheglobalwindpowermarket.TheWinDS3000™ isthe

highestcapacityoffshorewindturbinedevelopedinKoreatodateaswellas

theonlyoffshoredesigntoreceiveinternationalcertification.

TheWinDS3000™isdesignedforoptimalreliabilityanddurabilityinchal-

lengingoffshoreenvironmentsaswellastop-classoperationalefficiency

andmaintainability.Weerectedourfirstpost-prototypeunitinMarch2010

forthefirstphaseoftheYeongheungproject(3MW)andbookedourfirst

multi-unitorderinNovember2010fortheShinanproject(3MWx3),both

inKorea.In2011,weexpecttowinthesecondphaseoftheYeongheung

project,amongothers.Wearecurrentlydevelopingseveralotherturbine

modelsandplantolaunchalowwindclassversionoftheWinDS3000™be-

foretheendof2011asweacceleratedevelopmentofafullturbineproduct

lineupwiththeaimofbecomingamajorglobalsupplierinthewindindus-

tryby2015.

Turbine & Generator Solutions– Steamturbines(200MWe~1,450MWe)

– Gasturbines(144MWe~270MWe)

– Hydroturbines(30MWe~350MWe)

– Generators(150MVA~1,700MVA)

– Moistureseparatorreheaters

Project Portfolio– MarafiqTPP5~6,SaudiArabia:275MWex2

– CirebonTPP,Indonesia:700MWex1

– Gheco-One,Thailand:700MWex1

– Eraring,Australia:750MWex4(Retrofit)

– YeongweolCCPP,Korea:180MWex3

– YeongheungTPP,Korea:800MWex2

– HadongTPP,Korea:500MWex8

– DangjinTPP,Korea:500MWex8

– TaeanTPP,Korea:500MWex8

– DonghaeTPP,Korea:200MWex2

– Shin-KoriNPPUnits1~2,Korea:1,000MWex2

– Shin-KoriNPPUnits3~4,Korea:1,400MWex2

– Shin-UlchinNPPUnits1~2,Korea:1,000MWex2

– Shin-WolsongNPPUnits1~2,Korea:1,000MWex2

– YonggwangNPP,Korea:1,000MWex4

– UlchinNPP,Korea:1,000MWex4

– WolsongNPPUnits2~4,Korea:700MWex3

– YangyangPSPP,Korea:250MWex4

– YecheonPSPP,Korea:400MWex2

– SancheongPSPP,Korea:350MWex2

Material Handling Solutions– Containerhandlingcranes

– Bulkmaterialhandlingsystems

– Electricoverheadtravelingcranes

– Generalcargohandlingequipment

– Equipmentpartsandservice

Project Portfolio– KuwaitPort,Kuwait:STSGCx6,RTGCx6

– MilitaryOceanTerminalSunnyPoint,USA:STSGCx2

– PortofSamarinda,Indonesia:STSGCx2,RTGCx5

– BalboaPort,Panama:STSGCx4

– PortofBusan,Korea:STSGCx5,RTGCx49

– Posco,Korea:3,000-ton/hrCSUx4

– Posco,Korea:400-tonteemingladlecranex2

– VariousNPP,Korea:Polarcranesx8

– VariousTPP,Korea:Coalhandlingsystems

– Jaxport,USA:1,510-ton/hrCSUandconveyorsystem

– Jaxport,USA:STSGCx4

– PortofJakarta,Indonesia:STSGCx4

– PortofTanjungPelepas,Malaysia:RTGCx36

– JurongPort,Singapore:STSGCx5

– PSAInternational,Singapore:STSGCx9,RTGCx203

– JawaharlalNehruPort,India:STSGCx7,RTGCx30

– PortofColombo,SriLanka:RTGCx28

Boiler & HrSG Solutions– Circulatingfluidized-bedboilers

– Subcriticaldrumboilers

– Supercriticalonce-throughboilers

– Drum-typeHRSGs

– Once-throughHRSGs

– Balance-of-plantequipment

Project Portfolio – YeongheungTPPUnits1~2*,Korea:800MWex2

– YeongheungTPPUnits3~4*,Korea:870MWex2

– YeongheungTPPUnits5~6,Korea:870MWex2

– BoryeongTPP*,Korea:500MWex8

– HadongTPP*,Korea:500MWex8

– DangjinTPP*,Korea:500MWex8

– TaeanTPP*,Korea:500MWex8

– DonghaeTPP*,Korea:200MWex2

– SipatSTPPStage-I*,India:660MWex3

– Raipur-ChhattisgarhTPP,India:685MWex2

– MundraTPP*,India:800MWex4

– Gheco-One,Thailand:700MWex1

– Rabigh2TPP,SaudiArabia:700MWex4

– AinSokhnaTPP,Egypt:650MWex2

– MarafiqTPP5~6,SaudiArabia:275MWex2

– EssarCCPP*,India:120MWeHRSGx3

– KondapalliCCPP*,India:110MWeHRSGx2

– RehabCCPP*,Jordan:120MWeHRSGx2

– MapnaCCPP,Iran:160MWeHRSGx44

– IronwoodCCPP*,USA:250MWeHRSGx2

– CuaibaCCPP*,Brazil:175MWeHSRGx2

– PeterheadCCPP,UK:255MWeHRSGx3

– CastejonCCPP*,Spain:250MWeHRSGx1

– GibraltarCCPP*,Spain:250MWeHRSGx2

– PhuMy3CCPP*,Vietnam:235MWeHRSGx2

– PanglimaCCPP*,Malaysia:250MWeHRSGx2* Projectssuppliedutilizingtechnology

underlicensefromAlstomPower,Inc.

AnnualManufacturingCapacity

Boilers

8,500 mwe

GasTurbines

2,600 mwe

AnnualManufacturingCapacity

steam Turbines

5,500 mwe

Generators

8,500 mwe

rEVIEW oF oPErATIonS PowerBusinessGroup 28 2928

At DoosAn, we hAve A proven three-DecADe trAck recorD As the

prime equipment contrActor for koreA’s nucleAr power pro-

grAm, one of the sAfest AnD most efficient in the worlD. toDAy,

we Are well positioneD to plAy A key role in the inDustry’s globAl

renAissAnce As the trAnsition to A low-cArbon economy gAins

momentum ArounD the worlD.

2010 review

Globaldemandfornuclearpowerplantsandequipmentcontinuedtogrowin

2010asutilitiesmovedsteadilyforwardwithplanstoexpandtheirlow-carbon

baseloadgenerationcapacity.Ordersonceagainenjoyedrobustdouble-digit

growth,risingalmost33%toKRW2,274billionaswesignedacontractwith

KoreaElectricPowerCorporationtosupplythemajorequipmentforthefirst

twounitsoftheBrakaproject(1,400MWex4)intheUAE.Revenuegrowthwas

evenstronger,risingover57%toKRW1,226billionaswedeliveredthereactor

forShin-Kori3(1,400MWe)andsteamgeneratorsforShin-Wolsong2(1,000

MWe)aswellasreplacementequipmentforanumberofUSplants,including

thereactorheadandcontrolelementdrivemechanismforPaloVerde1(1,300

MWe),foursteamgeneratorsforSequoyah2(1,200MWe),andreactorheads

forArkansasNuclearOperation2(900MWe)andWaterford3(1,150MWe).

InadditiontothefirstinternationalsaleoftheAPR1400®nuclearplantforthe

Brakaproject,theyearalsobroughttwosignificantmilestonesaswedelivered

ourfinalOPR1000systemandfirstAPR1400®system.WhiletheOPR1000will

continuetobethemainstayofKorea’snuclearfleetforsometimetocomewith

atotalof12unitsdeliveredsince1995,theAPR1400®isthefuture,offering40%

moregeneratingcapacity,a60-yearservicelife,andenhancedsafetyfeatures

thatwillmakeitastrongcompetitorintheglobalmarketplace.

2011 outlook

Whilethe incidentat theFukushimanuclearplant in Japanhasonceagain

raisedconcernsaboutthesafetyofnuclearpower,itdoesn’tappearthatthe

industrywillexperiencethedramaticdownturnitsawaftertheChernobyldi-

sasterinRussia.In2011,wearetargetingordersofKRW1,700billion,including

themajorequipmentorderforBraka3~4.WeexpectrevenuestosurpassKRW

1,200billionaswedelivermajorequipmentforSanmen1(1,150MWe)andHai-

yang1(1,150MWe)inChinaaswellasShin-Kori4(1,400MWe)inKorea.

Webelievethatnuclearpowerhasamajorroletoplay intomorrow’s low-

carboneconomy.Asof2008,wehaveachievedfullself-relianceinallmajor

nuclearplantcomponents,pavingthewayforustomarketcompleteturnkey

nuclearplantsolutionsworldwide. InadditiontoChinaandtheUS,wesee

increasingopportunitiesintheMiddleEastfollowingourinvolvementinthe

UAE’sBrakaproject.Wecontinuetosystematicallyexpandandstreamlineour

integratedproductionsystemtoenhancecostleadershipandincreasemajor

equipmentproductioncapacityfromthecurrent3.5unitsto5unitsannually

by2012asweprepareforfuturegrowthopportunitiesaroundtheglobe.

NuclearPowerPlantBusinessGroup

nuclear Power Plant Solutions– PWRnuclearsteamsupplysystems

– CANDUnuclearsteamsupplysystems

– Fuelstorageequipment

– Man-machineinterfacesystems

– Balance-of-plant

– Replacement, repair,and refurbishment

services

Project PortfolioPWRSystems

– Ulchin,Korea:1,000MWex4

– Shin-Ulchin,Korea:1,400MWex2

– Yonggwang,Korea:1,000MWex6

– Shin-Kori,Korea:1,000MWex2

– Shin-Kori,Korea:1,400MWex2

– Shin-Wolsong,Korea:1,000MWex2

– Sanmen,China:1,150MWex1

– Haiyang,China:1,150MWex1

– Vogtle,USA:1,150MWex2

– VCSummer,USA:1,150MWex2

– LevyCounty,USA:1,150MWex2

– Braka,UAE:1,400MWex4

CANDUSystems

– Wolsong,Korea:700MWex3

– QinshanPhaseIII,China:700MWex2

MajorEquipment

– Sequoyah1~2,USA:1,200MWeRSGx8

– WattsBar1,USA:1,200MWeRSGx4

– ANO2,USA:900MWeRPZR,RRVHx1

– Waterford3,USA:1,150MWeRRVHx1

– IndianPoint2~3,USA:1,000MWeRRVH,

CRDMx2

– PaloVerde1~3,USA: 1,300MWeRRVH,

CEDMx3

– QinshanPhaseII3:650MWeRVx1

nuCLEAr PoWEr PLAnTBuSInESS GrouP

2010

2009

2008 573

1,226

780


2010

2009

20082,549

4,608

3,462



2010

2009

20081,230

2,274

1,716



OrdersrosebrisklytonearlyKRW2.3trillionin2010aswebookedthemajorequipmentorderforthefirsttwounitsoftheBrakaprojectintheUAE.RevenuesgrewstronglytoKRW1.2trillion,andourrecordorderperformanceboostedourbacklogtoanewhighofKRW4.6trillion.

30 3130

Shin-Kori nPP 3~4 ProjectAnewgenerationofnuclearplants isnowbeingbuilt inKorea.Shin-Kori3~4willbeequippedwithAPR1400® reactors,a third-generationdesignthatboasts40%higheroutputthanthecurrentmainstayOPR1000reactoraswellasa60-yearservicelifeformajorequipment.Developedovera 10-yearperiodbetween1992and2002, theAPR1400®designalsodramaticallyenhancesoperationalefficiencyandsafety,particular-lyintheareaofearthquakeengineering.Wewillsupplytheentirenuclearsteamsupplysystem(NSSS)forthisproject.

Plant ownerKoreaHydro&NuclearPowerCompany

Plant Capacity2,800MWe

1,400MWex2

Fabrication PeriodUnit32007~2013

Unit42007~2014

Portfolio NuclearPowerPlantBusinessGrouprEVIEW oF oPErATIonS 32 3332

At DoosAn, we Are the worlD leADer in seAwAter DesAlinAtion so-

lutions. our proven portfolio of msf, meD, AnD ro technologies

enAbles us to Deliver DepenDAble, cost-effective turnkey solu-

tions with the shortest leAD times in the inDustry. we continue

to progressively expAnD into the broADer wAter AnD wAstewAter

treAtment mArkets As we pursue our vision of becoming A globAl

leADer in wAter.

2010 review

Theglobalseawaterdesalinationmarketrecoverybegantogainmomentum

in2010withthetenderoftheRasAzZawrproject(228MIGD)inSaudiArabia,

theindustry’slargestprojecttodate.OurwinofthisUSD1.46billionEPCproj-

ecthelpedordersreboundsharplytoarecordKRW1,680billion.Revenuesde-

clined33%toKRW418billionduetothe2009orderdrought.Wefinishedthe

yearwithastrongbacklogofprojectstotaling426MIGDunderwayacrossthe

MiddleEastandNorthAfrica(MENA)region.

TheRasAzZawrprojectisahybridmulti-stageflashdistillation(160MIGD)and

reverseosmosis(68MIGD)plantcomposedofeight20MIGDsingle-module

MSFevaporatorsandsixteen4.3MIGDROmodulesthatwillmeetthewater

needsof3.5millionintheSaudicapitalofRiyadh.Duringtheyear,wecom-

pletedtheShuwaikhRO(30MIGD)projectinKuwaitaswellasdeliveringall6

evaporatorsforShuweihatS2(100MIGD)intheUAE.Wewerealsohonoredat

the2010GlobalWaterAwardspresentedbyGlobalWaterIntelligencewhenthe

ShuaibahROproject(33MIGD)inSaudiArabiawasselectedastherunnerup

fortheprestigious“DesalinationPlantoftheYear”award.Deliveredinjust19

months,thisexpansionoftheShuaibahPhase3project(194MIGDMSF)has

helpedalleviateaseriousongoingwatershortageintheJeddahregion.

2011 outlook

GrowingpopulationsandurbanizationacrosstheMENAregionwill require

majorinvestmentsindesalinationcapacityintheyearsahead.Whilecompeti-

tionwillbestiff,webelievethatourglobalmarketleadershipinthethermal

desalinationsegmentsince2004andabilitytodeliver innovativesolutions

usingthelatesttechnologieswillenableustowinatleastonemajorprojectin

2011.WegotofftoagoodstarttowardourordertargetofKRW900billionby

winningtheUSD124millionYanbuproject(15MIGDMED)inSaudiArabiain

February2011.Thisprojectisparticularlysignificantbecauseitwillbeourfirst

majormulti-effectdistillationprojecttodatewithasingle15MIGDevaporator

designedusingourindustry-leadingsingle-moduletechnology.

InadditiontoongoinginitiativesfocusedonenhancingourEPCandtechnical

capabilitiesinthedesalinationfield,wecontinuetostrategicallypursuegrowth

opportunitiesinthewatertreatmentandfacilityoperationsandmaintenance

fields.Wearecontinuouslysearchingfornewareasofbusinessandstrength-

eningourengineeringskills incurrentdesalinationareasasweexpandour

sightsbeyondtheMiddleEasttotargetnewopportunitiesinemergingmarkets

suchasChinaandIndia.

WaterBusinessGroup

Desalination Solutions– Multi-stageflashdistillation(MSF)

– Multi-effectdistillation(MED)

– Reverseosmosisfiltration(RO)

– Hybridsystems

Water & Wastewater Solutions– Brackishwaterreverseosmosis(BWRO)

– Dualmediafiltration(DMF)

– Membranebioreactor(MBR)

– Biologicalnutrientremoval(BNR)systems

Project Portfolio– AssirI,SaudiArabia:21MIGD

– ShoaibaPhase2,SaudiArabia:

100MIGDEPC

– TaweelahA2IWPP,UAE:50MIGDEPC

– Az-ZourPhaseIII,Kuwait:28.8MIGDEPC

– UmmAlNarB,UAE:62.5MIGDEPC

– Fujairah,UAE:

100MIGDHybridMSF/RO+660MWeEPC

– SoharIWPP,Oman:

33MIGD+596MWeEPC

– SabiyaPhasesI~III,Kuwait:100MIGDEPC

– ShuaibaSouthRehabilitation,Kuwait

– ShuaibaPumpingStationC,Kuwait

– RasLaffanBIWPP,Qatar:60MIGDEPC

– BenghaziNorth,Libya:0.55MIGDx2MED

– Zawia,Libya:0.55MIGDx2MED

– SabiyaPhaseIII,Kuwait:50MIGDEPC

– ShuaibahPhase3IWPP,SaudiArabia:

194MIGDEPCMSF

– ShuaibahExpansionRO,SaudiArabia:

33MIGDEPCRO

Projects underway– ShuweihatS2IWPP,UAE:

100MIGDEPCMSF

– JeddahROPhaseIII,SaudiArabia:

52.8MIGDEPCRO

– ShuwaikhRO,Kuwait:30MIGDEPCRO

– RasAzZawr,SaudiArabia:

228MIGDEPCHybrid(MSF160+RO68)

– Yanbu,SaudiArabia:15MIGDEPCMED

WATEr BuSInESS GrouP


2010

2009

2008 356

418

630


2010

2009

20081,556

2,080

832


2010

2009

20081,632

1,680

-



OrdersrecoveredtoreachnearlyKRW1.7trillionin2010aswewonthe228MIGDRasAzZawrprojectinSaudiArabia.WhilerevenuesdroppedtoKRW418billion,ourstrongorderperformanceboostedourback-logtonearlyKRW2.1trillion.

34 3534

Plant ownerShuaibahWaterandElectricityCompany

Production Capacity227MIGDwater

(194MIGDMSF+33MIGDRO)

Construction PeriodMSFPlant:2006~2009

ROPlant:2007~2010

Shuaibah Phase 3 IWPPThisaward-winningprojectisSaudiAra-

bia’sfirst independentwaterandpower

project todateandtheworld’s largest

desalinationplantnowinoperation.Like

manyofour recent thermal seawater

desalinationplants,ShuaibahPhase3

isaugmentedbya33MIGDreverseos-

mosisplantthatprovidesgreateropera-

tionalflexibilityandefficiency.

Industry recognition2005 EMEAPowerDealoftheYear,Project

Finance International

2005 ProjectFinanceDealoftheYear,

Euromoney

2006 DesalinationDealoftheYear,Global

WaterAwards,Global Water Intelligence

2009 ThermalDesalinationPlantoftheYear,

GlobalWaterAwards,Global Water

Intelligence

2009 InnovationAward,SaudiWater&Power

Forum

Portfolio WaterBusinessGrouprEVIEW oF oPErATIonS 36 3736

At DoosAn, we Are A verticAlly-integrAteD supplier of compo-

nents for the nucleAr AnD thermAl power plAnt inDustries

As well As mAteriAls for the steel, Auto, AnD other mAnufAc-

turing inDustries. we Deliver superior quAlity cAstings AnD

forgings bAckeD by worlD-clAss technicAl expertise AnD pro-

Duction fAcilities in koreA AnD romAniA.

2010 review

Despitegrowingdemandfromtheautoandpowerplantindustries,acon-

tinuingslumpintheshipbuildingindustry ledto lowerordersforcrank-

shaftsandothershipcomponents,resultinginslightlylowerordersand

revenuesin2010.Overall,ordersweredown6.6%toKRW646billion,while

revenuesslid2.7%toKRW611billion.

Duringtheyear,weexpandedbothourcastingandforgingshopsto in-

creaseourreactorshellforgingcapacityinresponsetogrowingdemandfor

ultra-largecastingsandforgingsfromthenuclearandthermalpowerplant

industries.Wearenowintheprocessofinvestinginanewelectroslagre-

meltingfurnacetoproduceultra-supercritical(USC)rotorsandmirror-like

moldsteelaswellasplatebackup-rollforgingfacilities.Wehaveconverted

ourfurnacesandheat-treatmentfacilitiestoLNGtoreduceourcarbonfoot-

print.Wealsocontinuetoinvestinthedevelopmentofintegratedforged

componentsfornuclearreactors, low-temperatureimpact-resistantsteel

castings,andothernewproductsthatwillcreatenewmarketopportunities

andboostprofitability.

2011 outlook

Whileweexpectrevenuesfromcastingsandbackuprollstodeclineslightly

in2011duetothe2009~2010downturnintheshipbuildingandsteel in-

dustries,webelievenewproduct launcheswillenableusto improveon

our2010performancewithrevenuessurpassingKRW630billion.Weare

strategicallyexpandingcapacitytosupportgrowingdemandfornuclear

reactorshellforgingsandUSCrotorsaswellasdiversifyingintonewvalue-

addedfieldsandglobalmarketsaswesetthestageforcontinuedorder

andrevenuegrowthinthecomingyears.Wealsoplantoexpandinvest-

mentinbothtechnologyandproductdevelopmenttoaddressgapsinour

productportfolio.Onthebusinessside,weareupgradingourkeyaccount

managementeffortsasweaggressivelypursuenewbusinessopportunities

inEurope,Russia,andAfricathroughDoosanIMGBinRomania.By2015,

weaimtoexpandmeltingcapacityto350,000tonsandforgingcapacityto

230,000tons.

Casting&ForgingBusinessGroup

Industries Served– Shipbuilding

– PowerGeneration

– IronandSteelMaking

– MoldandToolMaking

– Mining

– Cement

– Petrochemical

Industry-Leading Products– Hydroturbinecastings:#1

– Sternandruddercastings:#2

– Marineenginecrankshafts:#3

– Plasticmoldandtoolsteel:#4

– Workrolls:#4

CASTInG & ForGInGBuSInESS GrouP


2010

2009

2008609

611

628


2010

2009

2008289

540

506


2010

2009

2008636

646

692



OrdersandrevenuesdeclinedslightlytoKRW646billionandKRW611billionrespec-tivelyin2010astheglobalshipbuildingin-dustryremainedstagnant.Demandforultra-largecastingsandforgingsfromthepowerindustrieshelpedboostourbacklogtoKRW540billion.

38 3938

we sHARe pAssIonATeLy

LeADIng TomoRRow ToDAy Beyondourmission todeliver thepowerandwateressential to

growthandprogressaroundtheglobe,wepassionatelybelievewe

havearesponsibilitytomakeadifferenceinourlocalcommunities.

Weshareourtime,moneyandresourcestomakeourneighborhoods

betterplacestolive.Weactivelyprotecttheenvironment,health,and

safetyeverywhereweoperate.Andwecollaboratewithaffiliates,

partners,andbothgovernmentandnon-governmentorganizationsas

westrivetocreategreatervalueforallourstakeholders.

AtDoosan,engagingcommunitiesforgoodisanintegralpartofourDNA.Fromcommunityservicetoculturalsponsorships,weareunitedinourcommitmenttomakingourworldabetter,brighterplacetolive.

SHArE

Share Passionately Today

Community ServiceWebuiltonourlongtraditionofvolunteerservicein

early2011byformallyestablishingadedicatedorga-

nizationtohelpusmakeanevengreaterimpactfor

good.InMay2011,wesignedanagreementwiththe

cityofChangwoncoveringfourareas,includingsup-

portforcommunitycentersservingunderprivileged

childrenand teens, scholarships for low-income

middleandhigh-schoolstudentswhodemonstrate

academicexcellence,supportofvocationaltraining

andjobplacementforunemployedyouth,andsup-

portofselectcityprojectstoenhancepublicquality

oflife.Wealsocontinuedtoexpandourcommunity

serviceprograms inVietnam in2010, teamingup

withKorea’sChung-AngUniversityMedicalCenterto

providemedicalcheck-upsandtreatmentformore

than1,500localresidentsofQuangNgaiaswellas

cataractsurgeryforover30adults.

Cultural SponsorshipsAnotherwaywegivebacktoourlocalcommunitiesis

throughthesponsorshipofpopularpastimessuchas

concertsandsportsevents.InMay2010,wehosted

thethirdDoosanMatchPlayChampionship,theKo-

reaLPGA’ssolegolfmatch-playevent.TheKRW100

millionchampionshipwaswonbyJung-minLee,the

firstvictory inherprofessionalcareer.Wealsoex-

pandedourgolfsponsorshiptointernationalevents

in2010bybecomingapatronofthefamedBritish

Open,theoldestandmostprestigiousoftheworld’s

fourmajorgolftournaments.Wewerealsothetitle

sponsorofthefirstAsianDreamCupheldinHoChi

MinhCityinJune2011.OrganizedbyKoreanfootball

starJi-sungPark’sJSFoundation,thecupincludeda

footballclinicforyouthandacharitymatchbetween

Park’steamofinternationalfootballersandNaviBank

Saigon,withtheproceedsgoingtopromotethede-

velopmentoflocalfootball.

01.Freecleftlipandpalate

surgeryinVietnam

02.DoosanMatchPlayChampi-

onshipsponsorship

03.Footballclinicforyouthin

Vietnam

01 02 03

42 4342

AtDoosan,ourEHSphilosophyissimple.Weaimtobeanindustryleaderinenvironmental,health,andsafetypracticesandpoliciesaswedevelopthetechnologiesandproductsthatwillmaketomorrowamoresustainableplacetolive.

ProTECT EHS CommitmentSinceacquiringISO14001certificationin1997andOH-

SAS18001certificationin2004,wehavemadecom-

prehensiveEHSexcellencetoppriorityatproduction

facilitiesandprojectsitesaroundtheglobe.Overthe

pastthreeyears,wehaveinvestedKRW23billionto

switchtoLNG-fueledfurnaces,removeasbestosfrom

productionandofficespaces,andimplementanen-

vironmentalcrisismanagementsystematourChang-

wonplant.Wehavealsosetupapartnermentoring

program,providingenvironmental facilitytechnical

informationaswellasoperationalassistanceaswe

closelycooperatetocreateasustainablevaluechain.

Thisvigilant focusonEHS iskey toouroutstand-

ingenvironmentalandsafetyrecordthatroutinely

achieveszeroaccident-relatedworkinterruptionsover

thecourseofmulti-yearprojects,suchastheJebelAli

MTPPprojectintheUAE,whichsurpassed20million

man-hourswithoutanincidentinMay2010.

Environmental LeadershipOvertheyears,wehavesignednumerousvoluntary

agreementswithnationalandlocalgovernmentsto

reduceenergyusageandgreenhousegasemissions.

Combinedwithongoingenergyefficiencyinitiatives,

theseeffortshavesteadilyreducedCO2emissions,

cuttingthemby4,400tonsin2010alone.OurGHG

mitigationroadmapforthenextdecadewillfocuson

reductionsthroughenergyefficiencyimprovements

over thenext fiveyearsbeforeshifting tocarbon

capture in2015andthenon-siterenewablepower

generationfrom2017withwind,solar,andfuelcell

systems.

Ourenvironmentalcommitmentalsoextendstothe

productsandsolutionsweproduce. In2010,we

investedoverKRW146billionin74projects,includ-

ingMCFCfuelcellsystems,low-NOxburners,carbon

captureandstoragesystems,wind turbines,and

APR1400®nuclearequipmentaswecontinuedtofocus

onthecleaner,greenertechnologiesthatwillpower

growthintomorrow’slow-carboneconomy.

01.Riversidecleanupinitiative

02.Treeplantinginitiative

03.Windpowerdevelopment

initiative

01 0302

Share Passionately Today 44 4544

Global networkWith12overseassubsidiariesand37branchofficesworldwide,

wehaveanincreasinglyglobalface.Overthepastfiveyears,we

havewelcomedUSwatersolutionproviderDoosanHydroTech-

nology,RomaniancastingandforgingspecialistDoosanIMGB,

UKboilerOEMDoosanBabcock,andCzechturbineOEMŠkoda

Powerintoourfamilythroughstrategicacquisitions.Wehave

alsosetupDoosanEngineering&ServicesintheUStoexpand

ourarchitect-engineeringcapabilities,DoosanVinainVietnam

toexpandourmanufacturingcapabilities,andDoosanPower

SystemsintheUKtoprovidecompleteplantsolutionsanden-

ergyservicestopowerutilitiesinEuropeandtheAmericas.This

network isbringingtogethersomeoftheworld’sbestminds

andtechnologiestodeliverinnovativesolutionstotomorrow’s

powerandwaterchallenges.

Successful PartnershipsPartnershipsplayacrucialroleinourglobalsuccess.InKorea

alone,wedependonwellover1,000supplierstohelpusdeliver

world-classpowerandwatersolutionstocustomersaroundthe

world.In2009,wepartneredwiththeHumanResourcesDevel-

opmentServiceofKoreatoestablishanewvocationaltraining

programthattrainedover4,000on-andoff-sitepartnerworkers

in2010,offeringsome23coursesinninecoreareassuchasen-

gineering,qualitycontrol,andwelding.In2011,weestablished

a72-memberteamof insideandoutsideexpertstaskedwith

fundamentallyupgradingsuppliercompetitiveness.Theteamis

nowcollaboratingwithover140keysupplierstodevelopmaster

plansthatwillenhancetheircompetitivenessinsixbroadareas,

includingquality improvement,qualityassurance,production

technology,engineeringoptimization,productivity improve-

ment,andenvironment,health,andsafety.

Global recognitionBeyondourpositionasawell-knownandrespectednamein

theglobalpowerandwaterindustries,ourconsistentgrowthin

recentyearshasalsoearnedusaplaceonsomeoftheworld’s

mostprestigiouscorporaterankings. In2009,BusinessWeek

rankedusfourthoutof40companiesonitsannualWorld’sBest

Companieslist.TheBostonConsultingGroupnamedusfourth

inmachineryandconstructiononits2010ValueCreatorsrank-

ingsbasedonananalysisoftotalshareholderreturnduringthe

2005to2009period.Wewerealsohonoredtomakeoursec-

ondappearanceonthe2011 FortuneGlobal500astheDoosan

GrouprankedNo.489basedontotal2010groupsalesofUSD

19.94billion.

AtDoosan,webelieveittakesaglobalperspectivetobeatrulyworld-classcompany.Throughstrategicacquisitions,expansion,andpartnerships,wearecommittedtogeneratingsynergythatcreatesgreatervalueforallourstakeholders.

CoLLABorATE

Share Passionately Today

01.Familiarizationprogram

02.Skilledglobalworkforce

01 02

46 4746

50 IndependentAuditors’Report

52 Non-ConsolidatedStatementsofFinancialPosition

54 Non-ConsolidatedStatementsofOperations

55 Non-ConsolidatedStatementsofAppropriationofRetainedEarnings

56 Non-ConsolidatedStatementsofChangesinEquity

58 Non-ConsolidatedStatementsofCashFlows

FInAnCIAL sTATemenTs

Independent Auditors’ reportBasedonareportoriginallyissuedinKorean

The Board of Directors and Stockholders

Doosan Heavy Industries & Construction Co., Ltd.:

Wehaveauditedtheaccompanyingnon-consolidatedstatementoffinancoalpositionofDoo-

sanHeavyIndustries&ConstructionCo.,Ltd.(the“Company”)asofDecember31,2010and

therelatednon-consolidatedstatementsofoperations,appropriationofretainedearnings,

changeinequityandcashflowsfortheyearthenended.Thesenon-consolidatedfinancial

statementsaretheresponsibilityoftheCompany’smanagement.Ourresponsibilityistoex-

pressanopiniononthesenon-consolidatedfinancialstatementsbasedonouraudit.Theac-

companyingnon-consolidatedfinancialstatementsoftheCompanyasofDecember31,2009

wereauditedbyotherauditors,whosereportthereondatedMarch17,2010,expressedan

unqualifiedopiniononthosestatements.

WeconductedourauditsinaccordancewithauditingstandardsgenerallyacceptedintheRe-

publicofKorea.Thosestandardsrequirethatweplanandperformtheaudittoobtainreson-

ableassuranceaboutwhetherthefinancialstatementsarefreeofmaterialmisstatement.An

auditincludesexamining,onatestbasis,evidencesupportingtheamountsanddisclosures

intheestimatesmadebymanagement,aswellasevaluatingtheoverallfinancialstatement

presentation.Webelievethatourauditsprovideareasonablebasisforouropinion.

Inouropinion,thenon-consolidatedfinancialstatementsreferredtoabovepresentfairly,in

allmaterialrespects,thefinancialpositionofDoosanHeavyIndustries&ConstructionCo.,

Ltd.asofDecember31,2010andresultsofitsoperations,theappropriationofitsretained

earnings,thechangesinitsequityanditscashflowsfortheyearendedinconformitywithac-

countingprinciplesgenerallyacceptedintheRepublicofKorea.

Withoutqualifyingouropinion,wedrawattentiontothefollowing:

Asdiscussedinnote2(a)tothenon-consolidatedfinancialstatements,accountingprinciples

andauditingstandardsandtheirapplicationinpracticevaryamongcountries.Theaccompa-

nyingnon-consolidatedfinancialstatementsarenotintendedtopresentthefinancialposi-

tion,resultsofoperations,changesinequityandcashflowsinaccordancewithaccounting

principlesandpracticesgenerallyacceptedincountriesotherthantheRepublicofKorea.In

addition,theproceduresandpracticesutilizedintheRepublicofKoreatoauditsuchnon-

consolidatedfinancialstatementsmaydifferfromthosegenerallyacceptedandappliedin

othercountries.Accordingly,thisreportandtheaccompanyingnon-consolidatedfinancial

statementsareforusebythoseknowledgeableaboutKoreanaccountingprinciplesandau-

ditingstandardsandtheirapplicationinpractice.

KPMGSamjongAccountingCorp.,acorporationestablishedunderKoreanlaw,isamember

firmofKPMGInternational,aSwisscooperative.

Seoul,Korea

March4,2011

ThisreportiseffectiveasofMarch4,2011,theauditreportdate.Certainsubsequentevents

orcircumstances,whichmayoccurbetweentheauditreportdateandthetimeofreadingthis

report,couldhaveamaterialimpactontheaccompanyingnon-consolidatedfinancialstate-

mentsandnotesthereto.Accordingly,thereadersoftheauditreportshouldunderstandthat

thereisapossibilitythattheaboveauditreportmayhavetoberevisedtoreflecttheimpact

ofsuchsubsequenteventsorcircumstances,ifany.

Financial

Statements

50 5150

Non-ConsolidatedStatementsofFinancialPositionDecember31,2010,2009and2008

Non-ConsolidatedStatementsofFinancialPosition(Continued)December31,2010,2009and2008

(InmillionsofKoreanwon)

Liabilities 2010 2009 2008

Current liabilities

Accountsandnotespayable-trade 535,805 623,641 609,928

Short-termborrowings 832,153 1,195,107 1,338,834

Accountsandnotespayable-other 234,422 238,469 214,490

Advancereceipts 1,455,043 869,650 993,167

Withholdings 16,388 25,087 27,315

Accruedexpenses 126,347 87,305 119,635

Incometaxpayable 77,936 2,754 150,751

Currentportionoflong-termdebt,net 509,980 517,771 401,854

Currentderivativeinstrumentliabilities 172,782 396,516 761,260

Currentfirmcommitmentliabilities 49,561 16,622 -

Provisionforguarantees 37,200 - -

Total current liabilities 4,047,617 3,972,922 4,617,234

non-current liabilities

Long-termdebt,net 678,356 1,019,209 604,620

Long-termnon-tradepayables 39,727 39,454 47,201

Provisionforretirementandseverancebenefits,net 156,193 136,751 122,733

Non-currentprovisions 96,595 81,238 65,997

Depositsreceived 132,592 112,158 101,294

Non-currentderivativeinstrumentliabilities 197,105 294,930 761,583

Non-currentfirmcommitmentliabilities 62,173 10,396 -

Non-currentdeferredtaxliabilities 272,964 183,918 212,021

Othernon-currentliabilities 5,285 5,322 4,766

Total non-current liabilities 1,640,988 1,883,377 1,920,258

Total liabilities 5,688,606 5,856,299 6,537,492

Stockholders’ Equity

Commonstockof 5,000parvalueAuthorized-400,000,000sharesIssued-105,816,467sharesin2010,

105,739,767sharesin2009and104,953,300sharesin2008

529,082 528,699 524,767

Capitalsurplus 1,123,341 929,438 652,110

Capitaladjustments (156,720) (164,811) (241,460)

Accumulatedothercomprehensiveincome 1,218,162 1,269,389 1,293,132

Retainedearnings 823,086 756,757 1,152,991

Total stockholders’ equity 3,536,951 3,319,472 3,381,540

Total liabilities and stockholders’ equity 9,225,557 9,175,771 9,919,032

Assets 2010 2009 2008

Current assets

Cashandcashequivalents 347,125 517,263 508,661

Short-terminvestments 55,835 55,502 99,014

Accountsandnotesreceivable-trade 1,869,145 2,000,825 2,118,164

Accountsandnotesreceivable-other 136,765 78,127 71,239

Advancepayments 245,435 351,228 344,801

Prepaidexpenses 31,557 22,995 18,120

Currentderivativeinstrumentassets 85,464 128,802 219,160

Currentfirmcommitmentassets 108,262 206,917 -

Currentdeferredtaxassets 84,467 41,506 108,827

Inventories 252,102 266,802 240,180

Othercurrentassets 33,510 19,592 16,920

Total current assets 3,249,668 3,689,557 3,745,086

non-current assets

Long-termfinancialinstruments 40,941 20,532 18,105

Non-currentinvestmentsinsecurities 156,748 152,110 132,376

Equitymethodaccountedinvestments 3,180,950 2,729,441 2,638,528

Long-termloans 8,809 7,356 6,715

Property,plantandequipment,net 1,969,609 1,881,992 1,806,497

Intangibleassets,net 271,007 234,327 212,213

Non-currentderivativeinstrumentassets 138,349 93,245 189,199

Non-currentfirmcommitmentassets 66,696 182,284 -

Guaranteedeposits 77,601 83,866 56,013

Othernon-currentassets 65,178 101,061 99,533

Total non-current assets 5,975,889 5,486,214 6,173,946

Total assets 9,225,557 9,175,771 9,919,032

(InmillionsofKoreanwon)

Financial

Statements

52 5352

Non-ConsolidatedStatementsofOperationsYearsendedDecember31,2010,2009and2008

2010 2009 2008

revenue 6,178,335 6,279,481 5,709,660

Cost of sales 5,188,288 5,500,269 4,861,023

Gross profit 990,047 779,211 848,637

Selling, general and administrative expenses 543,205 375,395 374,200

operating income 446,842 403,816 474,437

non-operating income

Interestincome 15,231 20,566 16,462

Interestexpense (142,908) (167,204) (111,653)

Foreigncurrencytranslationgain,net 3,776 3,330 (130,117)

Foreigncurrencytransactiongain(loss),net 2,282 (57,344) 12,758

Lossonsaleofnon-currentinvestments,net - (7,905) 544

Equityinnetincome(loss)ofequitymethod

accountedinvestees,net11,570 (350,252) (361,261)

Impairmentlossesonintangibleassets (76) (1,253) (1,272)

Impairmentlossesonothernon-currentassets (32,400) - -

Lossontransactionofderivatives,net (17,939) (28,178) (1,949)

Gainonvaluationofderivatives,net 82,754 129,397 (151,940)

Lossonvaluationoffirmcommitmentassets,net (117,819) (150,125) 176,952

Servicefees (75,439) (30,441) (20,634)

Donations (18,323) (13,144) (35,605)

Others,net 519 19,047 10,598

other expense (288,772) (633,505) (597,117)

Income (loss) before income taxes 158,070 (229,689) (122,680)

Income taxes expense 46,863 98,626 (56,829)

net income (loss) 111,207 (328,315) (65,851)

Earnings (loss) per share

Basic earnings (loss) per share (won) 1,238 (3,748) (765)

Diluted earnings per share (won) 1,238 - (765)

(InmillionsofKoreanwon) (InmillionsofKoreanwon)

Non-ConsolidatedStatementsofAppropriationofRetainedEarningsYearsendedDecember31,2010,2009and2008

DateofAppropriationfor2010:March25,2011,

DateofAppropriationfor2009:March26,2010and

DateofAppropriationfor2008:March27,2009

2010 2009 2008

unappropriated retained earnings

Balanceatbeginningofyear 438 60 (20,691)

Recognitionofunrecordedlossof

equity-methodinvestee- (24,928) (6,936)

Netincome(loss) 111,207 (328,315) (65,851)

Balance at end of year before appropriation 111,645 (353,182) (73,281)

Transfer from voluntary reserves

Reserveforresearchanddevelopment 22,000 35,333 23,333

Reserveforsinkingfund - 367,666 -

unappropriated retained earnings available forappropriation

133,645 49,817 47,352

Appropriation of retained earnings

Legalreserve 6,800 4,500 4,300

Reserveforresearchanddevelopment 57,000 - -

Dividends-15%onparvalueat 750persharein2010,

10%onparvalueat 500persharein2009and

10%onparvalueat 500persharein200867,376 44,879 42,991

unappropriated retained earnings to be carriedover to subsequent year

2,469 438 60

Financial

Statements

54 5554

Non-ConsolidatedStatementsofChangesinEquityYearsendedDecember31,2010,2009and2008

Commonstock

Capitalsurplus

Capitaladjustments

Accumulatedother com-prehensive

income

retainedearnings

Totalstockholders’

equity

Balance at January 1, 2008 523,715 641,854 (231,881) 114,160 1,248,629 2,296,477

Dividends - - - - (40,437) (40,437)

Balanceforappropriation 523,715 641,854 (231,881) 114,160 1,248,629 2,296,477

Netloss - - - - (65,851) (65,851)

Acquisitionoftreasurystock - - (26,788) - - (26,788)

Stockoptions 1,052 2,404 (826) - - 2,630

Changesinequitymethodaccountedinvestments - 7,699 15,769 579,390 (6,936) 595,922

Changeinunrealizedgain(loss)onvaluationofavailable-for-salesecurities

- - - (3,238) - (3,238)

Gainonvaluationofderivatives - - - 16,030 - 16,030

Gainonrevaluationofland - - - 586,789 - 586,789

Balance at December 31, 2008 524,767 652,110 (241,459) 1,293,132 1,152,991 3,381,540

Balance at January 1, 2009 524,767 652,110 (241,459) 1,293,132 1,152,991 3,381,540

Dividends - - - - (42,991) (42,991)

Balanceforappropriation 524,767 652,110 (241,459) 1,293,132 1,110,000 3,338,549

Netloss - - - - (328,315) (328,315)

Acquisitionoftreasurystock - - (590) - - (590)

Disposaloftreasurystock - 126,625 29,564 - - 156,188

Stockoptions 495 3,989 1,367 - - 5,851

Changesinequitymethodaccountedinvestments - 102,513 46,307 33,926 (24,928) 157,817

Changeinunrealizedgainonvaluationofderivativeinstrument

- - - (150,982) - (150,982)

Changeinunrealizedlossonvaluationofderivativeinstrument

- - - 84,873 - 84,873


- - - (1,896) - (1,896)

Small-scalemerger 3,437 44,202 - 10,337 - 57,976

Balance at December 31,2009 528,699 929,438 (164,811) 1,269,389 756,757 3,319,472


Non-ConsolidatedStatementsofChangesinEquity(Continued)YearsendedDecember31,2010,2009and2008

Commonstock

Capitalsurplus

Capitaladjustments

Accumulatedother com-prehensive

income

retainedearnings

Totalstockholders’

equity

Balance at January 1, 2010 528,699 929,438 (164,811) 1,269,389 756,757 3,319,472

Dividends - - - - (44,879) (44,879)

Balanceforappropriation 528,699 929,438 (164,811) 1,269,389 711,878 3,274,593

Netincome - - - - 111,207 111,207

Stockoptions 384 4,934 529 - - 5,847

Disposalofequitymethodaccountedinvestments - 82,031 - - - 82,031

Changesinequitymethodaccountedinvestments - 106,938 7,561 43,634 - 70,865

Changeinunrealizedgainonvaluationofderivativeinstrument

- - - (6,262) - (6,262)

Changeinunrealizedlossonvaluation ofderivativeinstrument

- - - (765) - (765)


- - - (565) - (565)

Balance at December 31, 2010 529,082 1,123,341 (156,720) 1,218,162 823,086 3,536,951

56 5756

Non-ConsolidatedStatementsofCashFlowsYearsendedDecember31,2010,2009and2008

2010 2009 2008

Cash flows from operating activities

net income (loss) 111,207 (328,315) (65,851)

Adjustments for:

Depreciation 88,896 77,127 71,873

Amortization 22,405 30,188 21,876

Accrualforretirementandseverancebenefits 56,660 34,618 48,208

Foreigncurrencytranslationgain,net (7,430) (12,016) 129,880

Lossonsaleofnon-currentinvestmentsinsecurities,net - 7,905 (544)

Equityinnetloss(income)ofequitymethodaccountedinvestees,net

(11,570) 350,252 361,261

Impairmentlossesonintangibleassets 76 1,253 1,272

Impairmentlossesonothernon-currentassets 32,400 - -

Gainonvaluationofderivatives,net (82,754) (129,397) 151,940

Lossonvaluationoffirmcommitmentassets,net 117,819 150,125 (176,952)

Baddebtexpense 97,172 26,388 20,182

Otherbaddebtexpense 13,709 - -

Servicefees 37,200 - -

Others,net 58,808 42,356 45,145

Total adjustments 423,390 578,799 674,141

Changes in assets and liabilities:

Accountsandnotesreceivable-trade 29,377 77,015 (1,148,871)

Accountsandnotesreceivable-other (61,134) (7,060) (21,446)

Advancepayments 104,044 (5,981) (97,765)

Inventories 14,722 (27,825) (62,583)

Accountsandnotespayable-trade (84,362) 18,208 148,187

Accountsandnotespayable-other (2,885) 25,478 78,499

Advancereceipts 585,393 (123,517) 508,671

Incometaxpayable 75,183 (147,997) 92,605

Paymentofretirementandseverancebenefits (20,415) (26,592) (23,127)

Severancebenefitinsurancedeposits (17,221) 5,501 3,466

Derivativeinstrumentassets/liabilities (81,097) (95,362) 244,803

Deferredtaxassets/liabilities (41,630) 71,976 (209,962)

Dividendreceived 9,447 18,469 42,000

Others,net (8,399) (46,067) 87,283

Total changes 501,020 (263,753) (358,240)

net cash provided by (used in) operating activities 1,035,618 (13,269) 250,050


Non-ConsolidatedStatementsofCashFlows(Continued)YearsendedDecember31,2010,2009and2008

2010 2009 2008

Cash flows from investing activities

Decreaseinshort-terminvestments 4,007 62,299 39,475

Decreaseinnon-currentinvestments 99,808 20,150 7,256

Proceedsfromsaleofproperty,plantandequipment

1,107 191 1,244

Acquisitionofshort-terminvestments - (17,835) (29,172)

Increaseinnon-currentinvestments (331,583) (400,604) 126,751

Acquisitionofproperty,plantandequipment (160,438) (132,422) (177,045)

Acquisitionofintangibleassets (76,914) (63,369) (58,958)

Others,net (1,520) (32,294) (8,803)

net cash used in investing activities (465,533) (563,884) (352,754)

Cash flows from financing activities

Proceedsfromlong-termdebt 298,585 947,586 168,002

Disposaloftreasurystock - 196,614 -

Issuanceofcommonstock 3,682 3,228 2,629

Repaymentofshort-termborrowings (361,592) (132,016) 602,403

Repaymentofcurrentportionoflong-termdebt (636,019) (401,854) (253,010)

Acquisitionoftreasurystock - (590) (26,788)

Dividendspaid (44,879) (42,991) (43,047)

net cash provided by financing activities (740,223) 569,977 450,189

Increase in cash and cash equivalents due to small-scale merger

- 15,778 -

net increase (decrease) in cash and cash equivalents (170,138) 8,602 347,485

Cash and cash equivalents at beginning of year 517,263 508,661 161,176

Cash and cash equivalents at end of year 347,125 517,263 508,661

Financial

Statements

58 5958

Growing People, Growing Businesses.

Growing Businesses, Growing People.

TheDoosanstorystartedbackin1896whenfounderParkSeung-jikopeneda

smallfabricshopindowntownSeoul.Morethanacenturylater,weareaUSD20

billiongroupofcompaniesrankedNo.489onthe2011FortuneGlobal500that

generated55%oftotalsalesoutsideKoreain2010withmorethan38,000em-

ployeesat25domesticand115overseassubsidiariesin34countries.

Duringthe20thcentury,wehadasignificantimpactonthedevelopmentofKo-

rea’sconsumergoods,industrialmanufacturing,trade,andconstructionsectors.

Inthe21st,wearemakinganevenmoresignificantoneontheworld’sindustrial

infrastructure,construction,machinery,andequipmentsectors.Ledbyatrioof

businessesthatareglobally involved inbuildingtomorrow’s infrastructure—

DoosanHeavyIndustries&Construction,DoosanEngineering&Construction,

andDoosanInfracore—wearetodayanemergingglobalpartnerinimprovingthe

qualityoflifefortensofmillionsaroundtheworld.

Visitussoonatdoosan.comtofindoutmoreabouthowKorea’soldestbusiness

groupisbringingnewinnovationandvaluetocustomersaroundtheglobe.

gRoup AFFILIATes

AbouT THe DoosAn gRoup

DooSAn

CorPorATIon

www.doosan.com

DooSAn

CorPorATIon

–FASHION

PoloRalphLaurenand

Espritdistribution

DooSAn

CorPorATIon

–ELECTRO-MATERIALS

www.dse.co.kr

Copper-cladlaminate

manufacturing

DooSAn

CorPorATIon

–GLONET

Globallogistics,food

andchemicalimports,

pharmaceuticals,

nutraceuticals,and

cosmeceuticals

manufacturing

DooSAn

CorPorATIon

–INFORMATION&

COMMUNICATION

Solutionservices,data

centerservices,ASP

services,ERPsolutions

DooSAn

HEAVY InDuSTrIES &

ConSTruCTIon

Co., LTD.

www.doosanheavy.com

Powerplantfacilities,

seawaterdesalination

&watertreatmentplant

facilities,castingsand

forgings,construction

DooSAn

InFrACorE Co., LTD.

www.doosaninfracore.com

Constructionequipment,

industrialvehicles,machine

toolsandautomation

systems,dieselandCNG

engines,defenseproducts

DooSAn

EnGInEErInG &

ConSTruCTIon

Co., LTD.

www.doosanenc.com

Infrastructure,commercial,

residential,andindustrial

construction,chemical

processequipment,factory

automation,industrial

plantfacilities,foodand

beverageplantequipment,

OLEDpanels

DooSAn

EnGInE Co., LTD.

www.doosanengine.com

Marineenginesanddiesel

powerplants

DooSAn

CAPITAL Co., LTD.

www.doosancapital.co.kr

Integratedcreditfinancing

services

DooSAn DonGA

www.doosandonga.com

Textbooksandeducational

materials,printedand

electronicdictionaries,

encyclopediaCDs,online

learning,commercial

printing

SrS KorEA Co., LTD.

www.srs-korea.com

KFCKorea,BurgerKing,

foodcourts

orICoM InC.

www.oricom.com

Integratedmarketing

communications

DooSAn BEArS InC.

www.doosanbears.com

Professionalbaseballteam

DooSAn MoTorS

CorPorATIon

www.hondacarsdoosan.

co.kr

Hondaautomobilesales

andservice

nEoPLux Co., LTD.

www.neoplux.com

Venturecapital,corporate

restructuringand

consulting

DooSAn CuVEx

Co., LTD.

www.ladenaresort.com

LadenaResortoperation

DooSAn ToWEr

CorPorATIon

www.doota.com

Propertymanagementand

fashionmalloperation

DooSAn

FEED & LIVESToCK

CorPorATIon

www.doosanfeed.co.kr

Animalfeedmanufacturer

AT DoosAn, ouR gRowTH sTRATegy Is buILT on THe sImpLe buT

poweRFuL IDeA THAT gLobAL exCeLLenCe begIns wITH THe syneR-

gIsTIC gRowTH oF boTH ouR peopLe AnD busInesses.

60 6160

gLobAL neTwoRK

overseas Subsidiaries

DooSAn PoWEr SYSTEMS

LTD.

11TheBoulevard,Crawley

WestSussex,RH101UX,UK

Tel +44-1293-61-2888

Fax +44-1293-58-4816


LTD.

(BABCoCK)

PorterfieldRoad,Renfrew,

PA48DJ,UK

Tel +44-141-886-4141

Fax +44-141-885-3338

DooSAn PoWErSYSTEMS

AMErICAS LTD.

5ParagonDriveMontvale,

NewJersey07645,USA

Tel +1-201-746-8210

Fax +1-201-746-8610


EuroPE LTD.

BredeneyerStrasse2b,

45133Essen,Germany

Tel +49-201-4517-320

Fax +49-201-4517-328

ŠKoDA PoWEr LTD.

Tylova1/57,30128Plzen,

Czech

Tel +420-378-185-128

Fax +420-378-185-900


InDIA PVT., LTD.

[New Delhi Office]

DLFBuildingNo.8A,3rd

FloorDLFCyberCityPhaseII

Gurgaon122002,Haryana,

India

Tel +91-124-439-8200

Fax +91-124-414-7007

[Chennai Office]

GeeGeeUniversal,5th

FloorNo.2McNicholsRoad

Chetpet,Chennai600031,

India

Tel +91-44-2836-6930

Fax +91-44-2836-6936

DooSAn CHEnnAI WorKS

PVT., LTD.

18/2ASenneerkuppam

BypassRoad,Poonamallee,

Chennai600056,India

Tel +91-44-2649-2050

Fax +91-44-2649-4012

DooSAn HYDro

TECHnoLoGY InC.

912ChadLane,Tampa,FL

33619,USA

Tel +1-813-805-8800

Fax +1-813-623-6092

DooSAn HF ConTroLS

CorP.

1624WestCrosbyRoad,

Suite124Carrollton,TX

75006,USA

Tel +1-469-568-6526

Fax +1-469-568-6589

DooSAn IMGB

104BerceniRoad,

Bucharest4,Romania

Tel +40-21-301-3745

Fax +40-21-301-2502

DooSAn

EnGInEErInG & SErVICES

LLC

5ParagonDriveMontvale,

NJ07645,USA

Tel +1-201-746-8200

Fax +1-201-746-8210

DooSAn HEAVY

InDuSTrIES VIETnAM Co.,

LTD.

(Doosan Vina)

DungQuatEconomicZone,

BinhThuanCommuneBinh

SonDistrict,Quangngai

Province,Vietnam

Tel +84-55-713-001

Fax +84-55-713-008

DooSAn VInA HAIPHonG

Co., LTD.

Km92,NationalHighway

5,SoDauWardHongBang

District,HaiphongCity,

Vietnam

Tel +84-31-371-2710~11

Fax +84-31-371-2714

HAnJunG PoWEr LTD.

P.O.Box2803,Borokom

NCD,PapuaNewGuinea

Tel +675-320-0529

Fax +675-321-2984

overseas Branches

AMERICAS

DooSAn HEAVY

InDuSTrIES AMErICA

CorP.

ParkerPlaza,10thFloor400

KelbyStreet,FortLee,NJ

07024,USA

Tel +1-201-944-455431,24

Fax +1-201-944-5022

PITTSBurGH oFFICE

C/OWestinghouseElectric

CompanySuite115c,600

CranberryWoodsDrive,

CranberryTownship,PA

16066,USA

Tel +1-412-374-6071

Fax +1-724-720-0903

SAnTIAGo oFFICE

NuevaTajamar481,Ofician

1103,LasCondes,Santiago,

Chile

Tel +56-2-657-3333

Fax +56-2-657-3343

SCHEnECTADY oFFICE

GeneralElectricBuilding

33,Room202AOneRiver

Road,Schenectady,NY

12345,USA

Tel +1-518-385-5218

Fax +1-518-385-4984

TAMPA oFFICE

912ChadLane,Tampa,FL

33619,USA

Tel +1-813-805-8800

Fax +1-813-623-6666

WInDSor oFFICE

20InternationalDrive,

Windsor,CT06095,USA

Tel +1-860-731-6479

Fax +1-860-731-6482

São PAuLo oFFICE

(DooSAn PoWEr SYSTEMS)

AlamedaSantos787,7th

floor,SaoPaulo,01419-001,

Brazil

Tel +55-11-2348-0100

ATLAnTA oFFICE

(DooSAn PoWEr SYSTEMS)

1050CrownPointeParkway

Suite1200,AtlantaGA

303385,USA

Tel +1-770-551-5750

Fax +1-770-551-5753

ASIA

DooSAn HEAVY

InDuSTrIES JAPAn CorP.

MitaKokusaiBuilding,

Room24101-4-28,Mita,

Minato-guTokyo108-0073,

Japan

Tel +81-3-3452-5451~3

Fax +81-3-3452-5624

BAnGKoK oFFICE

10thFloor,M-ThaiTower,All

SeasonsPlace,87Wireless

RoadPhatumwan,Bangkok

10330,Thailand

Tel +66-2-654-0690

Fax +66-2-654-0693

BEIJInG oFFICE

GatewayPlaza,TowerB,

19thFloorNo.18Xiaguangli,

NorthRoad,EastThirdRing

ChaoyangDistrict,Beijing

100027,China

Tel +86-10-8454-7131~33,

7122

Fax +86-10-8484-7139

HAnoI oFFICE

#1101,DaehaBusiness

Center,360KimMa,Ba

DinhDistrictHanoi,Vietnam

Tel +84-4-6273-0545

Fax +84-4-6273-0550

JAKArTA oFFICE

PlazaBapindo,Mandiri

Tower20F,JlJendSudirman

No54-55,Jakarta,

Indonesia

Tel +62-21-2995-0105

Fax +62-21-2995-0108

MuMBAI oFFICE

501,CNBSquare,Sangam

Complex,AndheriKurla

Road,Andheri(E),Mumbai

400059,India

Tel +91-22-6177-0500

nEW DELHI oFFICE

515,FithFloor,TimeTower,

MGRoadGurgaon122002,

Haryana,NewDelhi,India

Tel +91-11-4665-3300

Fax +91-11-4665-3333

HYDErABAD oFFICE

119,1F,WhiteHouse,

Block-3,6-3-1192/1/1,

KundanBagh,Begumpet,

Hyderabad500016,India

Tel +91-40-6613-2444

Fax +91-40-6613-4227

SHAnGHAI oFFICE

Rm809,BuildingA,FarEast

InternationalPlazaNo.319,

XianXiaRoad,ChangNing

DistrictShanghai200051,

China

Tel +86-21-5877-8696

Fax +86-21-5877-5938

TAIPEI oFFICE

7Fl4,No.51,KeelungRoad

Section2,Taipei,Taiwan,

R.O.C.

Tel +886-2-2739-2255

Fax +886-2-2739-2266

EUROPE

FrAnKFurT oFFICE

ArabellaCenter,9thFloor,

LyonerStrasse44-48

FrankfurtamMain60528,

Germany

Tel +49-69-69-5004-11

Fax +49-69-69-5004-10

MIDDLEEAST&AFRICA

ABu DHABI oFFICE

AlGhaithTower,5th,Room

508,HamdanStreetP.O.

Box27767,AbuDhabi,UAE

Tel +971-2-627-6273

Fax +971-2-627-6274

MIDDLE EAST oPErATIonS

CEnTEr

MonarchOfficeTower,Level

30,SheikhZayedRoad,

P.O.Box11859,Dubai,UAE

Tel +971-4-327-5545

Fax +971-4-327-5592

DuBAI oFFICE

30thFloor,MonarchOffice

Tower,OneSheikhZayed

Road,P.O.Box11859,

Dubai,UAE

Tel +971-4-327-5545

Fax +971-4-327-5529

DooSAn WATEr DuBAI

r&D CEnTEr

MonarchOfficeTower,Level

29,SheikhZayedRoad,

P.O.Box11859,Dubai,UAE

Tel +971-4-327-5545

Fax +971-4-327-5596

rIYADH oFFICE

OfficeNo.205&206,The

PlazaBuilding(AkariyaNo.

4),OlayaStreet,P.O.Box

9656,Riyadh11423,

KingdomofSaudiArabia

Tel +966-1-419-1696

Fax +966-1-419-1995

DoHA oFFICE

AbdullaAlKuwariBuilding,

AlMuntazaArea,CRing

Road,Doha,Qatar

Tel +974-4443-5201

Fax +974-4443-5218

CAIro oFFICE

2ndfloor,LandMark

Building1,Southern90th

Road

(justafterNATABuilding,

CityCenter,thefirstsection)

Cairo,Egypt

Tel +20-2-2613-1038

62 6362

TomoRRow ToDAy At Doosan, we have long understood that tomorrow’s

dreams are built on today’s results. Today, our vision

of being a global leader in power and water has never been

clearer. or closer. We invite you to join us as we help lead

the next wave of innovation and collaboration to build your

tomorrow, today.

WWW.DooSAnHEAVY.CoM

HEAD oFFICE & CHAnGWon PLAnT

22DoosanVolvo-ro,Seonggan-Gu,

Changwon,Gyeongnam642-792Korea

Tel +82-55-278-6114,7114

Fax +82-55-264-5551,552

SEouL oFFICE

465Gangnam-daero,Seocho-Gu,Seoul

137-920Korea(C.P.OBox1826,SeoulKorea)

Tel +82-2-513-6114

Fax +82-2-513-6200

leading tomorrow - doosan heavy · leading tomorrow today ... we establish this uk-based holding...

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