hd_steel_AR2007

HYUNDAI STEEL
Annual Report 2007
A STEP CLOSER TO
TOMORROW

Despite periods of economic uncertainty in the region,
Hyundai Steel Company has remained a stalwart fixture
from the beginning of Korea’s steel industry.
We continue to place our key emphasis on the
environment as part of our core values as we conduct our
day-to-day operations under the firm belief that what
comes from nature must be returned to it unharmed.
The resources we use to create our products are formed
deep within the earth. That we use these resources to
make bigger and better products of the world’s best
quality is the second phase in our relationship with
nature.
Our ultimate aim is to respect the earth we walk on,
leaving it unspotted by our footprints.
CONTENTS
02 FINANCIAL HIGHLIGHTS
06 2007 AT A GLANCE
08 CHAIRMAN’S MESSAGE
10 VICE CHAIRMAN’S MESSAGE
12 MISSION
20 FIRST CLASS GOODS
22 PRODUCT INTRODUCTION
26 PLANT OVERVIEW
28 RESEARCH & DEVELOPMENT
32 SOCIAL CONTRIBUTION ACTIVITIES
34 ENVIRONMENT ACTIVITIES
37 FINANCIAL STATEMENTS
52 FINANCIAL REVIEW
54 GROWTH TRACK
56 GLOBAL NETWORK
58 INTEGRATED STEEL MILLS

Hyundai Steel Company Annual Report 20070203
FINANCIAL HIGHLIGHTS
Sales Compound Annual Growth Rate (CAGR) stands at 19.6%
and OP CAGR stands at 12.2% over the last 5 years.
Stock Price Performance vs. KOSPI
■HSC ■KOSPI
HSC(￦33,750)
HSC(￦79,000)
KOSPI(1897.13p)
KOSPI(1435.26p)
Stock Facts
2006 2007
Stock Value in KRW 33,750 79,000
Number of Shares Issued (Common Stock) 84,897,919 84,897,919
Total Market Capitalization(KRW billion) 2,965 6,707
Highest Share Price (KRW) 40,350 95,300
Lowest Share Price (KRW) 21,350 29,850
Foreign Ownership 21.35% 21.27%
Five-Years Financial Review (KRW in billions) (USD in million)
2003 2004 2005 2006 2007 2007
Sales ￦3,609 ￦5,049 ￦5,051 ￦5,481 ￦7,383 ＄7,869
Operating Profit 422 630 507 592 670 714
EBITDA 591 815 704 801 923 984
Net Income 242 476 1,032 474 520 554
Assets 4,678 5,707 6,396 7,024 8,833 9,415
Liabilities 2,307 2,827 3,344 3,524 4,784 5,099
Shareholder’s Equity 2,371 2,880 3,052 3,500 4,049 4,316
Number of Common Share(Unit: ’000 shares) 98,898 91,398 84,897 84,897 84,897 84,897
KIA Motors Corp.
Chairman Chung Mong-Koo
Foreign shareholders
Individual shareholders
Others
Ownership Structure
21.4%
2007
12.6%
21.3%
24.3%
20.4%
Stock Price Performance vs. Kospi
In 2007, Hyundai Steel Company's Stock price
increased from 33,750 KRW to 79,000 KRW,
a 134% increase on the previous year. This
increase was much higher than the overall
increase of the KOSPI (32.18%) and that of the
steel industry (80.50%). The main catalysts
behind the stock price increase were favorable
market reactions to our Dangjin investment and
increases in the prices of steel products.
2003 2004 2005 2006 2007
Sales
(USD in millions) (KRW in billions)
＄7,869
￦7,383
5,481
5,0515,049
3,609
Shareholder’s Equity
2003 2004 2005 2006 2007
2,371
2,880 3,052
3,500
＄4,316
￦4,049
Liabilities
2003 2004 2005 2006 2007
2,307
2,827
3,344
3,524
＄5,099
￦4,784
2003 2004 2005 2006 2007
591
815
704
801
＄984
￦923
EBITDA
2003 2004 2005 2006 2007
Assets
4,678
5,707
6,396
7,024
＄9,415
￦8,833
Operating Profit
＄714
￦670
592
507
630
422
2003 2004 2005 2006 2007
Share Price (KRW)
Mkt Cap
(KRW billion; U$ bn)
10,500
13,500
￦1,038bn ￦1,234bn
￦1,779bn
￦2,865bn
U$7bn
￦6,707bn
20,950
33,750
$84.20
￦79,000
2003 2004 2005 2006 2007
A STEP CLOSER TO TOMORROW

A STEP CLOSER TO TOMORROWHyundai Steel Company Annual Report 20070405
FINANCIAL HIGHLIGHTS
- Used in buildings and structures
- Cross-sectional diameter: 10 - 57 mm
- Hyundai Steel Company is Korea’s largest producer of reinforcing bars.
REINFORCING BARS
■AnnualProductionVolume ■AnnualSalesVolume
2006
2007
Division Production Volume / Sales Volume Proportion of Sales(2007) Sales
28%
- Used in construction and civil engineering works
- Hyundai Steel Company is the first local steelmaker to produce wide flange beams.
WIDE FLANGE BEAMS
Angles & Channels
- Used in truss-work, shipbuilding, steel structures, etc
Sheet Piles
- Used in dams, bridges, etc
Round Bars
- Used in automobile, industrial machinery, aircrafts, etc
STEEL SHAPES
- Used in automobiles, electronic appliances, construction materials, high pressure
gas containers, oil pipelines, etc
- The Dangjin plant is equipped with an automated hot rolling facility.
HOT ROLLED STEEL
- Used in industrial tanks, industrial chemical equipment, interior/exterior construc-
tion materials, kitchen fixtures, electronic appliances, printing presses, etc
- Fully recyclable eco-friendly products that can be completely recycled
COLD ROLLED
STAINLESS STEEL
Heavy Machinery
- Used in heavy equipment such as caterpillars, rollers, etc
Rolls
- Used in diverse casting rolls, including ADM rolls, etc
Steel Casting Products & Ingots
- Used in sternpost steel casting products and ingots used in forging
HEAVY MACHINERY, ETC
3,811
3,847
3,903
3,915
(’000 tonnes)
2006
2007
25%
2,542
2,496
2,667
2,664
(’000 tonnes)
2006
2007
2006
2007
10%
1,174
1,016
1,174
1,010
728
664
(’000 tonnes)
2006
2007
2006
2007
21%
1,203
1,165
3,029
2,918
1,557
577
(’000 tonnes)
2006
2007
7%
183
186
144
135
(’000 tonnes)
2006
2007
9%
375
431
416
604
(’000 tonnes)
2006
2007 674
527
(billion KRW)
2006
2007 521
558
(billion KRW)
(billion KRW)
(billion KRW)
2006
2007 1,846
1,449
(billion KRW)
2006
2007 2,058
1,707
(billion KRW)

FORCE OF NATUREHyundai Steel Company Annual Report 20070607
2007 AT A GLANCE
OCTOBER
- Pohang Plant succeeds in developing
900x300 H-Beam
- Incheon Plant succeeds in developing wide
flange shapes [305x305x26.8/44.1]
- Long-term coking coal supply contract with
EVCC
NOVEMBER
- Concrete placing for No. 1 Blast Furnace,
Dangjin Plant
- Began operating Hot Rolling Mill Simulator
DECEMBER
- Signed Technical Cooperation Agreement with
ThyssenKrupp Steel [TKS, Germany]
- Blast furnace construction contract
[SK E&C, Korea]
- Cokes, Sintering facility construction contract
[Lotte E&C, Korea]
- Dangjin plant Hot Rolling Mill A manufactures
over 1.8 million tonnes of steel
JULY
- Ground-Breaking Ceremony for closed type
raw material handling facility
- CE marker acquired for hot rolled steel
[S235JR/S275JR] produced in Dangjin Plant
- UK CARES Certification acquired for reinforcing
bars produced in the Pohang Plant
AUGUST
- Pohang Plant develops Korea’s first horizontal
hot rolled steel
SEPTEMBER
- Korean Standard Certification acquired for
reinforcingbarsusedforwelding[SD500W]
- Sintering facility supply contract
(Samsung ENG, Korea)
- Steel Plate facility supply contract
(SMS-Demag, Germany)
APRIL
- Blast Furnace facility supply contract
(Paul Wurth, Luxembourg)
- Long-term slab supply contract with Beitai
Iron & Steel Group
- Acquired Occupational Health and Safety
Management System [OHSAS18001]
Certification for Pohang Plant
MAY
- Steel making facility supply contract
(JP SPCO, Japan)
- Long-term iron ore supply contract with Vale
JUNE
- Transformation facility supply contract
(Uhde, Germany)
- Continuous casting system supply contract
(VAI, Germany)
- Ceremony for the completion of new, continu-
ous casting system in hot rolling mill, A
Dangjin Plant
- Acquired New Excellent Product [NEP]
Certification for Parallel Flange Channel
JANUARY
- Korean Standard Certification acquired for
Welded Construction Rolled Steel [SM490A],
produced in the Dangjin Plant
FEBRUARY
- Corex facilities of Dangjin Plant dismantled
and shipped
MARCH
- 42nd Annual General Shareholder's Meeting
held
At the center of all our philosophies and operations is respect.
This is a quality we inject into all our operations and expect
from all our staff across all levels of our company. This respect
extends to technology, consumer, society and humanity.
Without respect we can not hope to achieve the lofty goals we
continually set for ourselves.
RESPECT

CHAIRMAN’S MESSAGE
I sincerely thank all of our customers and shareholders for having expressed such great interest in
Hyundai Steel Company.
During the previous year, as a result of exerting our continuous efforts in each area, Hyundai Steel
Company has been able to establish momentum in launching itself as a global steel company. Through
the release of custom designed steel products to local markets and through innovative marketing strate-
gies, we have expanded our market even more broadly and have grown to become a key player in the
steel industry. Especially, after the ground breaking ceremony of our Dangjin integrated steel mills in
2006, construction and contracts for key facilities are well on schedule. Furthermore, we have been able
to secure the supply of raw materials from four of the world’s largest raw materials producers through
contracts or MOUs, and have exchanged technological cooperation contracts with ThyssenKrupp Steel.
These activities have greatly aided our efforts to establish a solid foundation for becoming a world-class
steel company.
Looking ahead, Hyundai Steel Company will continue to strive through innovations of our current electric
arc furnace operations, enhancement of our product mixtures to meet the needs of domestic and
international markets, and the smooth operation of our soon-to-be constructed integrated steel mills.
In addition, as a global steel company, we will strive to fulfill our responsibility to meet society’s needs,
and based upon our sense of being a socially aware company, we will spare no effort in creating a vigor-
ous and prosperous society for our world.
Hyundai Steel Company considers the wellbeing of humanity to be its most valued objective. By main-
taining the fragile balance among humanity, the environment, and society in general, Hyundai Steel
Company will continue to maximize its value and will sustain its efforts to become one of the world’s
greatest companies.
Mong-Koo Chung
Chairman

VICE CHAIRMAN’S MESSAGE
Dear valued shareholders,
Despite various challenges throughout 2007 for the steel industry, including a sharp rise in raw material prices,
Hyundai Steel Company achieved excellent results, including passing ten million tonnes in product manufacturing
and recording sales valued at KRW 7 trillion.
Early in 2007 we secured the necessary raw materials we needed for the operation of our integrated steel mills, as
planned. This started with our agreement with Paul Wurth in April 2007 on the supply shaft furnace facilities.
Following this agreement we finalized further agreements for raw materials suppliers Vale (formerly CVRD) in May
2007, and EVCC in December 2007.
In securing new technology, 200 researchers began new research into producing premium hot-rolled steel at our
new R&D center, which opened in March last year. Moreover, through our comprehensive technological cooperation
agreement with ThyssenKrupp Steel in December 2007, we are now able to secure advanced operational technol-
ogy.
In 2007, we made many achievements to existing areas of business. We secured electric furnace steel slab manu-
facturing technology to become only the second, company in the world to achieve this level of technology, con-
structing hot rolled steel 210mm slab casting facilities in our Dangjin plant. As we were also able to develop
900x300 wide flange shapes and Low-Temperature Material Steel for the first time in Korea, lessening the need for
imported steel products, we ushered in a new standard of excellence in our long products, improving profitability
along the way.
As a result of these efforts, we recorded sales of KRW 7.38 trillion and an operating profit of KRW 668.6 billion in
2007, a 34.7% and 13.0% increase respectively, on 2006. Production of steel products saw an increase by 22.0% to
11.33 million tonnes. Sales increased by 23.0% to 11.25 million tonnes.
All in all, we achieved remarkable results in 2007 through continuous innovations in management, ceaseless
efforts towards cost reduction and strident efforts by employees amid unstable circumstances.
Several threats loom in 2008. The uncertainty of the world economy is increasing due to the U.S. subprime mort-
gage crisis and there are warnings about excesses in the economic boom in China. In the steel industry we expect
supply and demand problems and price rise trends in scrap and slab to increase.
However, expansion in domestic demand spurred by continuous growth in shipbuilding and the automotive indus-
try, China’s export control policy and Korea’s new administration’s economy oriented policy, will bolster the com-
pany’s management environment in 2008.
Thus, we plan to achieve production of 11.63 million tonnes and increase total sales by 5.4% in 2008. This year’s
goal for Hyundai Steel is to establish a basis for sustainable growth and to ensure a high-profit business structure
to reinforce our steel making capabilities.
The year 2008 will be a critical year and looms as a turning point for steel making investment which will influence
the company’s long term future. As always our employees will do their best to develop Hyundai Steel as a world-
class steelmaker by overcoming the current uncertainties and laying a foundation for further expansion in our busi-
ness. This means living as a member of our market communities and contributing to the nation’s economic devel-
opment.
Watch our company closely over the coming year. As always, we appreciate your support.
Thank you.
Seung-Ha Park
Vice Chairman & CEO

Hyundai Steel Company Annual Report 2007 A STEP CLOSER TO TOMORROW
MISSION
1213
2007 Steel Market Trends and its effect on Hyundai Steel Company
Throughout 2007 Hyundai Steel Company experienced the highs and lows of opportunities and threats to our core busi-
nesses but emerged confidently, with strong market share and profitability.
Bolstered by construction booms in the Middle East and ongoing development in emerging markets has powered growth
in exports. This combination of favorable domestic and international factors pushed our overall sales to a record level of
KRW 7.383 trillion and an operating profit of KRW 760 million won.
On the downside, increasing Chinese imports and an increasing price of raw materials posed threats to our business in
2007 and continues to be of concern in the future, but we continue to remain positive in our outlook for 2008 and
beyond.
Hyundai Steel's Management Policy for 2008
BuildingaFoundationforContinuousGrowth
In2008,HyundaiSteelCompanywillconcentrateitseffortstowardsdevelopingnewmarkets,strengtheningourmarketposi-
tion in Korea and securing raw materials. Through these efforts Hyundai Steel will construct its foundation for continuous
growth.
EstablishmentofHighlyProfitableBusinessStructure
Establishinghighrevenuebusinessthroughcostreduction,enhancingleadership,andstrengtheningourcapabilitiesindevel-
opingnewproductswillbethekeythemesofcompanymanagementthroughout2008.
StrengtheningtheIntegratedSteelMill'sCoreCompetency
HyundaiSteelhasalwaysmaintainedacommitmenttoqualityinalloursteelproducts,toinnovationofourkeytechnologies,
and to preserving and revitalizing the Korean natural environment. To this end Hyundai Steel's integrated steel mills is being
constructed as one of the most environmentally friendly steel mills in the world. Furthermore, new alliances with
ThyssenKrupp Steel of Germany, and the construction of a new R&D center at our Dangjin Plant will help us gain the technol-
ogynecessarytoproducesteelofevenhigherquality,ensuringourcompetitiveedgecontinueswellintothefuture.
ENHANCING OUR CORE
COMPETENCY
Since late 2001, due to the steel price increase, strong recovery in the
domestic construction market and world economic growth led by devel-
oping countries, Hyundai Steel’s sales have grown by more than 10% on
year and we have secured a wide ranging portfolio from steel bars to steel
sheets, along with the operation of hot rolled manufacturing systems in
the Dangjin plant.
We expect to grow as a company through an outstanding portfolio that
will soon be able to manufacture using both blast and electric furnaces
after the completion of the Dangjin Integrated Steel Mill project in 2010.
Along with quantitative growth, we are aiming to continue growing our
sales and profit base by trimming costs, exploring export markets, devel-
oping new products, cultivating demand, counter-acting import steel
products and securing raw materials at low cost.

11,331,898 tonnes
Building Modern World It is a blessing for us to be able to see our products in so many of the world’s
landmark buildings and structures. There is a strength and security in steel which we know and understand. We
work with this strength each and every day. But, like our products, responsibility weighs heavily upon our shoulders.
This is because, like the strength of steel, the strength of our products is taken for granted, meaning our products
are trusted to provide security for the things all or us hold most precious in life.
It is this responsibility to keep providing the best and safest products we can that drives us on. We know, only by
continuing to deliver on this promise, can we receive the honor of providing our products for the great monuments in
the modern world.
WORLD'S 2nd
LARGEST
ELECTRIC ARC FURNACE
COMPANY
Hyundai Steel currently runs
15 electric arc furnaces and
has the world's second
largest electric arc furnace
capacity.
7,383billion won
34.7% INCREASE YoY
Sales and operating profit
have recorded KRW 7,383
billion and KRW 670 billion
respectively.

SALES CAGR OF 19.6%
For the last 5 years, Hyundai
Steel sales and operating
profit achieved a compound
annual growth rate(CAGR) of
19.6% and 12.2%, respec-
tively.
DOMESTIC MARKET
BASED COMPANY
79.1% of Hyundai Steel
Company's sales amount
comes from sales from the
Korean domestic market.
The Lifeblood of Industry For over fifty years, our products have been instrumental in the develop-
ment of the modern world. Steel has been the backbone of transportation and construction, and helped shape
modern cities into the new millennium. This legacy continues around the world – a process of renewal in modern
cities and of creation in developing nations.
With the power of our products in the hands of the construction and manufacturing industries anything is possible.
Economies grow and prosper, nations are built and people thrive through increased mobility, confidence and conve-
nience. Hyundai Steel hopes to assist all people reach this heightened level of prosperity and modernity.
79.1%
19.6%

ONE OF THE LARGEST
PRIVATE PROJECTS
Hyundai Steel is expected to
invest over 5.84 trillion won
in its Dangjin integrated
steel mills project.
5.84 trillion won
8million tonnes
The Foundation of Dreams Build your dreams on something solid. Construct a future that is safe and
secure, bold and exciting, creative and daring. At Hyundai Steel, our creativity is giving rise to new dreams for
humanity and a new era of imagination and creativity as we stretch the boundaries of possibility.
On the back of imminent new innovations, what we will be able to achieve in the future will expand the limits of
imagination still further. The Korean steel industry is poised for a shift in what is possible and Hyundai Steel is at
the forefront of this revolution.
ANNUAL 8MT (4MT EACH)
In an industry where size
does matter, Hyundai Steel
is building two world class
blast furnaces with annual
capacities of 4 million
tonnes each.

FIRST CLASS GOODS
Rising from the ashes of the Korean civil war, Hyundai Steel Company has grown to
become one of the world’s leading steel manufacturers. Selling our products across the
globe has allowed us to become a dynamic company, capable of producing industry-
leading products for a variety of industrial applications in diverse markets.
Since 2001, a growing number of our products have received recognition from the
Korean Ministry of Commerce, Industry and Energy, earning the title of “First Class
Goods”. Hyundai Steel has the largest portfolio of international first class goods among
domestic steel companies. This is an honor we carry with pride and a standard we are
committed to maintain throughout our product range.
Full awareness of global trends and specifications in construction, shipping and auto-
motive manufacturing has acted as a guiding beacon for our corporate direction since
we began in 1954. Recognizing the needs of our consumers, pioneering developments
in the industry and leading the way in sustainable environmental management is at
the forefront of our thinking and remains the focal point in our ongoing strategy.
Our wide flange beams are known for their strength and shock-absorbent qualities, and are used in structural
frames for their convenience in welding. They are usually used as beams or columns for building skyscrapers,
factories, warehouses, hangars, and gymnasiums. They are also used as footing piles for building subways and
bridges, as well as in building steel framed apartments, schools, and small-to-medium size arcades and houses.
Lately, demand for wide flange beams in developed countries is increasing, as earthquake proof buildings and
civil engineering structures of greater strength are favored to avoid preventable casualties in earthquake-prone
areas.
WIDE FLANGE BEAMS
Our high-speed steel rolls (HSS Roll) have acquired First Class Goods certification in 2001. The first generation
HSS roll was developed in 1993. We now manufacture fourth generation HSS roll with increased abrasion and heat
resistance, and are developing fifth generation HSS rolls and high carbon steel rolls.
HSS roll is a centrifugal steel casting and is vastly superior in terms of corrosion-resistance compared with con-
ventional castings. This ensures consistent increases in production for Hyundai Steel. HSS rolls increases dura-
bility, hence increasing lifecycle replacement and spec accuracy. HSS roll is used in steel bars, small beams and
steel casting products for ship parts. We hold a prime position in the local market, producing over 20,000 tonnes
of HSS roll annually, 70% of which is supplied to the Korean domestic market.
HIGH SPEED STEEL
ROLL(HSS ROLL)
STEEL CASTING
PRODUCTS FOR
SHIP PARTS
Excavators are used in digging trenches for buildings, road building, developing oil fields and ocean farms, and in
felling. The track shoe assembly is part of the undercarriage of excavators, and is considered as important as the
engine, which is the heart of the excavator. The track shoe assemblies disperse body mass efficiently and the
three wheels attached to it ensure ground connection in swamps, and sandy or gravelly terrain. Hyundai Steel
has consistently been supplying the track shoe assemblies to major Japanese and Korean construction and
machinery enterprises since 1985.
TRACK SHOE
ASSEMBLY
Since ships began to grow in size with industrialization, inverted angles were developed to minimize actual ton-
nage of ships and to scatter or disperse the impact of clashes. Hyundai Steel developed the inverted angle in the
Incheon Plant in 1982 and became the world’s second company to develop it. Korea is the biggest shipbuilding
country in the world and has three years of back orders. Subsequently, we are expecting demand of the inverted
angle to remain strong. We are speeding development of high impact steel used in higher value added ships and are
planning to make sales to domestic shipyards, and to Japan and China, the world’s major consumers of these prod-
ucts.
INVERTED ANGLE
Sheet Piles are used in supporting the vertical or horizontal loads of upper structures. Prior to the existence of
sheet piles, log piles were embedded in to the ground to prevent the earth behind it from collapsing. They were
not particularly durable, so were mainly used in simple framed constructions.
Steel sheet piles were developed to eliminate these weaknesses. They are widely used in permanent structures,
impervious structures, and temporary earth structures. They were first developed in Denmark in 1900. In Korea
they were first developed in 1980 and have since been exported around the world.
SHEET PILE
Steel Casting Products are used for ship parts such as rudder horns, stern bosses, etc. Rudder horns support the
rudder, and stern bosses support ship propellers. These structures are designed to resist corrosion, vibration and
cavitation (a term used to describe the behavior of voids or bubbles in a liquid occurring in propellers) under the
water. Therefore, thorough quality control and special techniques are required in manufacturing these products.
Lately, demand for larger container ships is rapidly increasing, in turn rising the demand for steel castings.

PRODUCT INTRODUCTION
Reinforcing Bars
Wide Flange Beams
Steel Shapes
Hot Rolled Steel
Cold Rolled Stainless Steel
Heavy Machinery, etc
2007 Overview
In 2007, the total volume of Korean domestic steel sales of the top seven steel companies was over 10 million
tonnes. This figure has increased by 6.7% from 2006. The total volume of Hyundai Steel’s domestic sales, alone,
is over 3,790 thousand tonnes and reached an export sales volume of 130 thousand tonnes, which adds up to
3,920 thousand tonnes in sales. Our total sales of reinforcing bars have increased by 1.82% since 2006.
Hyundai Steel has business earnings of KRW2,057,500 million, which increased by 20.53% in 2007 compared to
2006. The reason for such a sizable increase was a rise in the price of reinforcing bar due to raw material price
hikes and increased demand for reinforcing bar in 2006.
Outlook for 2008
Due to large development works in Korea, (e.g. Enterprise City, Innovation City, Multifunctional Administrative
City, New City) investment in construction is expected to rise by 4.0% in 2008 and demand for reinforcing bar is
also expected to rise by 2.9%, or about 11,620 thousand tonnes in volume. From 2008, the export duty on rein-
forcing bar in China increased from 10% in 2007 to 15%. Hence, reinforcing bar imports from China into Korea are
expected to decrease demand. Demand for Korean domestic reinforcing bar is expected to rise and the prices of
raw materials are also expected to rise and meaning the price of the reinforcing bar is expected to climb sharply.
2005 2006 2007
Annual Production Volume 3,778 3,811 3,903
Annual Sales Volume 3,793 3,847 3,915
Annual Sales (KRW) 1,823bn 1,707bn 2,058bn
Market Share 37.4% 36.8% 37.8%
(Korean Domestic)
Reinforcing Bars
2007 Overview
In 2007, the total volume of wide flange beams of 3,520 thousand tonnes has topped our previous record. The
figure has increased by 7% from 2006. Domestic sales volume is 2,158 thousand tonnes, an increase of 7% and
exports have increased by 1,368 thousand tonnes or 9%. Hyundai Steel has achieved 1,470 thousand tonnes in
domestic sales and 1,190 thousand tonnes in export sales, for a total sales output of 2,660 thousand tonnes.
This is a 4.7% increase on last year’s domestic sales and a 10.19% increase from last year’s export sales, for a
6.73% total increase. Raw business earnings increased by 27.42%, to KRW1,846,100 million. The reason for
such outstanding results is that we increased wide flange beam exports to the Middle East, Europe and America
which are all currently experiencing booms in the construction industry and overall business growth.
Outlook for 2008
Due to the Korean Government’s Balanced Land Development Policy and the favorable climate across industries
demanding wide flange beam (shipbuilding, automobile and industrial machinery), domestic demand for wide
flange beams is expected to rise. As demand from the Middle East and Europe is also still strong due to their
domestic construction booms and high Korean domestic prices, further gains in export growth are expected in
2008. Hyundai Steel will keep up this export level and run our factories at full operational capacity. This will lead
to an increase in production volume of 7.4%, from 1,445 thousand tonnes in 2007 to 1,550 thousand tonnes in
2008. We aim to assume a greater share of Chinese wide flange beams in the domestic market as the Chinese
government eases restraints on exports of wide flange beams. We are also planning to generate extra demand
by developing new sizes of wide flange beams.
2005 2006 2007
Annual Sales (KRW) 1,313bn 1,449bn 1,846bn
Market Share 70.1% 68.0% 67.2%
(Korean Domestic)
Wide Flange Beams
(unit: ’000 tonnes)
Manufacturing Plant Volume (as of 2007)
2006
SalesVolume
(unit: KRW in billion)
(unit: KRW in billion)
2006
SalesAmount
■Domestic Sales ı ■Export Sales
3,618
1,613 94
229
2007
2007
3,789
1,995 63
126
2006
SalesVolume
SalesAmount
2006
1,416
806 642
1,080
2007
1,474
2007
941 905
1,190
Incheon
35.61%
Pohang
31.50%
Dangjin
32.89%
Total
3,903
Incheon
71.49%
Pohang
28.51%
Total
2,667

Steel Shapes
Hot Rolled Steel
Cold Rolled Stainless Steel
Heavy Machinery, etc
2007 Overview
In the first half of 2007, demand for steel shapes in construction was favorable and sales revenue seemed to
increase as the price of steel shapes went up. However, in the second half of the year, due to falling demand for
steel bar and early implementation of the budget for Social Overhead Capital (SOC), increases in demand slowed.
Despite this, demand for steel shapes increased continuously in the Middle East and Europe.
Hyundai Steel’s production volume and sales volume for 2007 was the same as the previous year, at 1.17 mil-
lion tonnes and 1.01 million tonnes respectably. However, due to the increase in prices, the total amount of
sales increased by 9.7% from KRW664 billion to KRW728 billion won.
Outlook for 2008
It is expected that nominal consumption of steel shapes will be 5,150 thousand tonnes, an increase of 3.8%.
Korean domestic demand is expected to rise to 6,790 thousand tonnes, increasing by 2.42% due to increases in
investment in the public construction sector. Demand for steel shapes, on public investment alone, is expected
to rise by 4.5%. The rate of increase is expected to be low in the first half of the year, at about 2.1%, however in
the second half of the year, it is expected to rise to 7.6% due to the expansion of public works and SOC invest-
ment. In order to meet the rapidly increasing demand for wide flange beams, we are planning to export steel
shapes to high price areas only. Exports increased by 14.6% in 2007, however, they will decrease by about 2.2%
in 2008 due to a recovery in Korean domestic demand, a rise in shipping charges and a slowdown in the global
economy.
2005 2006 2007
Annual Sales (KRW) 820bn 664bn 728bn
2007 Overview
In 2007, Hyundai Steel Company Hot Rolled Steel sales increased by 169.7% to KRW1,557 billion as hot rolling
mills B came fully online. Production and sales were both favorable. However, due to increases in the price of the
principal raw material, slabs, the margin of profit was reduced. To minimize this loss, we supplied 210 mm slabs,
produced in hot rolling mills A. However, operating profit still came in at a 29 billion won loss.
Outlook for 2008
In 2008, the Korean domestic demand of Hot Rolled Steel is expected to rise by only 3.3%. Production of Cold
Rolled Steel Sheets is expected to turn around from a decline. However, Hot-dip Zinc Coated Carbon Steel Sheets
and Steel Tubes are expected to slow down in growth. Therefore, Korean domestic demand for Hot Rolled Steel is
expected to increase by 2.9% in the first half of the year and by 3.3% in the second half, for an increase of 2-3%
overall. The price of slabs is expected to continue to rise sharply in 2008, as well. Hyundai Steel is planning to
produce 1 million tonnes of Hot Rolled Steel through hot rolling mill A and 3 million tonnes from hot rolling mill B.
Hyundai Steel is planning to produce 210mm slab from 1.2 million tonnes of scrap on the side to be used in hot
rolling mill B to minimize raw materials expenses. Hyundai Steel will be purchasing the rest of the slab, 0.8 mil-
lion tonnes, strategically.
2005 2006 2007
Annual Output 367 1,203 3,029
Annual Sales Volume 289 1,165 2,918
Annual Sales (KRW) 148bn 577bn 1,557bn
Market Share 0.9% 3.2% 12.6%
(Korean Domestic)
2007 Overview
In 2007, sales of steel castings increased by 13.5%, to KRW240,100 million due to increased demand for steel
castings in the wind power industry, and prosperity in the shipbuilding industry. Sales of track chain assembly,
the key component of excavators, increased by 27.7%, to KRW202,600 million due to encouraging growth in
infrastructure construction worldwide. Sales of cast rolls for rolling mills also increased by 8.0% to KRW76,900
million due to the establishment and expansion of rolling mills in Korea and China.
Outlook for 2008
It is expected that production and sale of steel castings will reach 300 thousand tonnes and KRW290,700 mil-
lion respectively. With this prediction in mind, it appears likely we will achieve this year’s sales goal as demand
will increase throughout the year on the back of the establishment and expansion of steel forging companies
and increased number of shipbuilding contracts. We aim to increase sales of track chain assembly to 164 thou-
sand tonnes, an 8.6% increase from last year. We are expecting to continue to perform well in sales in China
through our Qingdao Plant. We are also hoping to create more demand in Japan, Europe and South-East Asia.
Korean domestic sales of cast rolls for rolling mills are expected to be similar to those of 2007. Sales of cast rolls
for rolling mills in China are expected to increase by over 20%, to 3,000 tonnes in sales volume, as the Chinese
shipbuilding industry is producing more steel sheet for ships. We are expecting our overall sales to reach
KRW81,100 million, over 20 thousand tonnes in volume.
2005 2006 2007
Annual Production Volume 334 375 416
Annual Sales Volume 531 431 604
2007 Overview
2007 was an unfortunate year for the stainless industry. In May, the price of nickel, the main raw material for
stainless, rose sharply to USD5,400 per tonne and then fell continuously to USD3,600 per tonne by July.
Enterprises demanding stainless steel were expecting an extra fall in nickel prices and put off their orders or
used their stockpiles, causing overall demand and prices to drop. In these market conditions, Hyundai Steel has
controlled actual supply and demand and reduced production. However, as the market situation continued to
worsen, total production and sales both came to 0.14 million tonnes, a fall of 21.9% and 27.4%, respectively.
Sales decreased by 6.7% to KRW521 billion.
Outlook for 2008
Many points out that price fluctuations should be less volatile in 2008. The price of nickel has been on the rise
since 2006 due to increased production worldwide, however, as the stainless industry is strengthening through
production of 400 systems and increased demand of 400 systems, the volume of consumption is not likely to
increase dramatically. The stainless industry’s ability to cut production is also better now than in the last two
years, which should lead to more stable nickel prices. The stockpiles of stainless from enterprises demanding
stainless have created are expected to run out by the first quarter of 2008. As a result, stainless steel is
expected to perform poorly in the first half of the year, but incline towards more stable profit position in the
second half of 2008.
2005 2006 2007
Annual Production Volume 170 183 144
Annual Sales Volume 167 186 135
Market Share 20.6% 15.7% 13.3%
(Korean Domestic)
Incheon
29.32%
Pohang
70.68%
Pohang
47.79%
Total
1,174
Dangjin
100%
Total
3,029
Incheon
100%
Total
144
Incheon
57.11%
Total
416
2006
SalesVolume
SalesAmount
2006
707
466 198
309
2007
2007
871
629 99
139
2006
SalesVolume
2006
SalesAmount
532 45
1,082 83
2007
1,419 138
2007
2,680 239
2006
SalesVolume
107
2006
SalesAmount
315 243
79
2007
347 174
2007
91 44
2006
SalesVolume
2006
SalesAmount
349
409 118
82
2007
2007
499
509 165
104
(unit: ’000 tonnes) (unit: ’000 tonnes)
(unit: ’000 tonnes)(unit: ’000 tonnes)
(unit: KRW in billion) (unit: KRW in billion)
(unit: KRW in billion)(unit: KRW in billion)

Qingdao Plant, China
Incheon Plant, Korea
Dangjin Plant, Korea Pohang Plant, Korea
Growth & product diversification
Product volume
(Unit:thousand tonnes)
2
0
4
6
8
10
12
14
2003 2004 2005 2006
Annual output & production CAPA
(Unit: million tonnes)
Output
CAPA
7.5
10.4
12.5 12.5
7.4 7.8
8.2
9.3
2007
13.6
11.3
PLANT OVERVIEW
INCHEON PLANT, KOREA
Sales ￦3,119bn
Area 920,000㎡
Product CAPA 4,705,000 tonnes
Products: Wide Flange Beams, Cold Rolled Stainless
Steel Sheets, Angles and Channels,
Reinforcing Bars, Rails, Steel Cast and
Forged Steel Products
CAPA
DANGJIN PLANT, KOREA
Sales ￦2,242bn
Area 6,530,000㎡
Products: Reinforcing Bars, Hot Rolled Steel Plates
QINGDAO PLANT, CHINA
Sales ￦80bn
Area 66,000㎡
Product CAPA 15,000 Track Assemblies,
8,000 Rollers
Products: Track Assembly for Excavators, Roller
Hyundai Steel has four plants - three in Korea (Incheon, Pohang and Dangjin) and one in China (Quingdao).
We also have many regional offices around the world, from Europe (Frankfurt) to South-East Asia
(Singapore). On the back of continuing growth in demand for our products, our plants grow in production
capacity year by year. This is made possible by continuing improvements in manufacturing capabilities. As
of 2007, we have a total of 6,140 employees.
(’000 tonnes)
2006
2007 4,100
4,705
4,100
4,704
2006
CAPA
Steel Making Capacity Product Capacity Steel Making Capacity Product Capacity
3,100
5,040
POHANG PLANT, KOREA
Sales ￦2,022bn
Area 660,000㎡
Products: Wide Flange Beams, Reinforcing Bars, Rails, Rolls,
Round Bars, Heavy Machinery
(’000 tonnes)
CAPA
2006 3,150
2,746
Steel Making Capacity Product Capacity
2007 3,150
2,840
2007 3,100
6,060
(’000 tonnes)
10,000
10,500
11,000
11,500
6,500
7,000
7,500
8,000
8,500
9,000
9,500
2003 2004 2005 2006 2007
Long Steel
Flat Steel
Heavy Ind.
7,473
7,848
8,180
9,288
11,332

2829
RESEARCH & DEVELOPMENT
FROM IRON ORE
TO AUTOMOTIVE PARTS
HyundaiSteelbuiltitsmainlaboratoryinFebruary2007asapartofproduction
processforhighpurityliquidsteel. Over200researchersworktogetherinthisfacility
toobtaineverincreasingtechnologicalprowess,rangingfromthesteelmanufactur-
ingindustrytothe automakerindustry. HyundaiSteelanditstechnologicalpartners
worktogetherinjointresearchprojects,creatingappreciablesynergiesandaccumu-
latingrequisitetechnologiesneededaheadofthecompletionoftheintegratedmill.
Developed integrated steel making and processing technologies
- Completed installation of eight simulation facilities, 136 analysis equipments.
Smelting
Major processes and technology
• Sintering: blending of the best raw material mixture
• Coke: raw material blending technology
• Blast furnace: designing distribution of raw materials placed into the
furnace
Methods of securing technology
• Technological alliances with foreign companies
(TKS, Vale, BHPB, Rio Tinto, DMT)
• Developing original technology
(by utilizing pilot facilities)
Steel making/Continuous casting
• Spare chartering management
(KR drawing conditions for desulfurization)
• Converter: develop operation model
• Secondary refining(RH): developing operation model
• Continuous casting: secondary cooling pattern design
• Numerical formula model:
predict and perform heating, rolling and cooling
• Utilizing pre-existing system(A Hot Rolling Mills)
• Developing in-house technology(by utilizing pilot facilities)
• Technological tie-ups with foreign pioneers(TKS, JFE)
Wrought steel/Steel plates
• Analysis model: analyze loading, heat-flow, and cooling
• Measuring model:
measure the temperature and plate shape
• Controlling model:
control width/thickness/shape/temperature
• Utilizing pre-existing system
(A Hot Rolling Mills and B Hot Rolling Mills)
• Technological tie-up with foreign pioneers(TKS)
• Joint technological development
(joint research in controlling/measuring related industries and
study)
Hyundai Steel Laboratory R&D Research worker (2007)
Hyundai, Kia Motor + Hysco 148 personnel
Hyundai Steel 129 personnel
total 277 personnel
Hyundai Steel Ratio 46.6%

Mission for Social Contributions
As a leading steel manufacturer, we must con-
tribute to bringing happiness and convenience to
all people and make the world a more sustainable
place through eco-friendly economic activities
and by carrying out active social responsibilities.
Key Values in our Contributions to Society
- Eco-friendly economic activities and efforts
towards preservation of the environment
- Carrying out social responsibility as a corporate
citizen
- Efforts to coexist with society
- Efforts to ensure dignity and happiness for all
through actualizing value for society
- Efforts to meet society’s wishes world-wide
quickly and effectively
Operation of Social Services Group
The Hyundai Steel Social Services Group, founded
in April 2005, is actively involved in community
social work. It works on various projects, helping
out in social welfare facilities, providing manual
assistance to farmers, helping the neglected, pre-
serving the environment and whatever else the
local community reasonably requires. The group
operates in areas around Seoul, Busan, Daegu,
Incheon, Pohang and Dangjin. It also donates rice
to rural communities . Hyundai Steel also supports
employee family contributions to the Social
Service Group, so employees can share the joy of
volunteering with their families.
Major Social Contribution Program
1. Junior Environment Class
Hyundai Steel understands that children are our
future. We are currently running junior environ-
ment classes for primary school students in
Incheon, Pohang, and Dangjin. The junior environ-
ment class became our main social program in
2007 under the motto, “Children and the
Environment, Our future.” Once a month, we run
class experiments on environment-related sub-
jects. Junior environment classes will spread
across three years as they involve continuous
education on subjects such as food and the envi-
ronment, energy and the environment, and water
and the environment.
2. Funding and Supporting Activities
Hyundai Steel Company is running a grant match-
ing system. In 2007, KRW220 million was granted
to the Korean Association of Welfare Institutes for
the Disabled to install fire extinguishers to
improve safety for the disabled. We have also
funded people with low incomes by providing
health insurance and school meals for their chil-
dren.
3. Relationship Supporter Campaign
Employees form one-on-one relationships with
aged people who are alone and without families.
About 90 employees have one-on-one relation-
ships with aged people, exchanging phone calls
regularly. Through this, the employees are form-
ing special relationships with elder citizens, gain-
ing awareness of their health and living condi-
tions.
It’s been four years since our employees first
invited disabled people without families for New
Years and Thanksgiving events. Volunteers also
deliver food and essential goods to the poor
during these festivals, as well.
4. Community Services
- Blood Donation Campaign: twice annually
(March, October)
- Helping farmers in Dangjin by giving them
manual assistance and also purchasing their
goods
- Computer classes for the community
- Kimchi sharing program for the poor
- Donation of steel products for building services
for flood victims unable to rebuild their homes
5. Education
- Provision of Monthly Junior Engineering Classes:
employees, who have received instruction work
as exclusive lecturers for elementary school stu-
dents in Dangjin. They run basic elementary sci-
ence experiments to help children understand
science.
- Soccer training camp for children in Incheon and
Dangjin
- Yearly scholarships for middle and high school
students from low income families to help them
realize their dreams.
6. Environment
The Oil Leak in December 2007: Volunteers have
been scooping up oil with buckets and absorbent
cloth, treating birds covered in oil and scrubbing
blackened rocks
Total Amount of Contributions to Society
Hyundai Steel has been extending its social contri-
butions gradually year by year since 2003 in
areas of social welfare, sports, the arts and cul-
ture, and education. We are planning to extend
even further into environmental preservation and
education.
SOCIAL CONTRIBUTION ACTIVITIES
HERE FOR ALL
Hyundai Steel’s contribution to society is an integral part of the Hyundai Group’s
management philosophy - the pursuit of happiness for all mankind. Hyundai
Steel strives hard to be a company that contributes to society through close
interaction with social groups and organizations. We share the Hyundai Group’s
motto for Social Contributions, “The World Moving Together,” and are committed
to making ongoing contributions to society and the planet.
3233
Completion of Slab Caster, June, 2007
Hyundai Steel became the second steel manufac-
turer in the world, following Japan's Tokyo Steel, to
produce steel with a thickness of 210mm using
electric arc furnace operations. We consider this
accomplishment as proof of Hyundai Steel
advanced steel technology, and we expect such
technology to aid the company’s performance
well into the future.
This accomplishment will enable Hyundai Steel to
produce its own slab used in running Dangjin's
hot rolled coil mills A and B. An aspect that will
assist in Hyundai Steel's efforts in accumulating
the technology necessary to start Hyundai Steel 's
new blast furnaces.
The slab caster will also aid Hyundai Steel in pro-
tecting its profitability amidst rising import slab
prices.
Hyundai Steel's Laboratory, February, 2007
Hyundai Steel is advancing towards its long estab-
lished goal of building an integrated steel mill.
With the aim of producing high purity liquid steel,
Hyundai Steel built its laboratory in February,
beginning operation in March. Over 200
researchers are working in the laboratory to
obtain the technology needed for diverse indus-
trial grade steel manufacturing to auto making.
Hyundai Steel (liquid steel supplies), Hyundai
Hysco cold rolled products supplies), Hyundai
Motor Company and Kia Motors Cooperation
(demand enterprises) are working together on
this research to develop strong working syner-
gies, accumulating technologies needed ahead of
the completion of the integrated mills.
Technical Cooperation MOU with ThyssenKrupp
Steel
On December 6, 2007, Hyundai Steel signed a
technical cooperation MOU with ThyssenKrupp
Steel[TKS] of Germany and Hyundai Motor
Company of Korea.
A technical cooperation with ThyssenKrupp Steel,
whose blast furnace manufacturing operational
technology is known to be one of the world's best,
is expected to be a stepping stone for Hyundai
Steel in its goal of becoming a global steel com-
pany.
Hyundai Steel will be receiving direction from
ThyssenKrupp Steel during the building and early
operational phase of the integrated steel mills
operations.
The technical cooperation also includes
ThyssenKrupp Steel providing documentation on
relevant technologies, providing staff training to
Hyundai Steel Company's employees and facility
testing at the final stages of construction.
Synergistic Effects Among Conglomerates
Steel manufacturing is the foundation of all key industries.
Thus, when steel manufacturing business runs effectively, all
related businesses reap the benefits of synergistic effects.

ENVIRONMENT ACTIVITIES
Environmental Vision
Super Green, Global Company
3 basic strategies for medium-long term envi-
ronmental management
- Transition to a clean production system
- Organization of an environmental committee and
strengthening of its activities
- Establishment of a comprehensive environmen-
tal protection policy for our planet
Activities strengthening eco-friendliness in
pre-existing business
- Making and applying policies stricter than legis-
lation, relating to atmospheric and water pollu-
tants
- Constructing a resource circulating society by
maximizing the recycling of by-products
Constructing new eco-friendly business
- Plans to build a closed system of unloading
materials to reduce dust
- Plans to install activated absorption carbon to
remove organic pollutants (e.g. dioxin)
Systems/Committee Activities (including. ISO
14001)
- All of our plants in Korea acquired the ISO14001
certification of standard environmental manage-
ment from the International Standardization
Organization in 2003.
- The environment committee within the firm
established a plan for environmental reforms, as
well as strengthening environmental research,
development of an environmental reform index
and introducing environmental accounting and
other leading environmental management tech-
niques.
Major Environmental Activities
1. Establishing an Environmental System
For more systematic environmental management,
Hyundai Steel developed the environment man-
agement system in accordance with ISO14001,
the standard environmental management of the
International Standardization Organization, and
acquired certificates for three plants in Korea.
With this, Hyundai Steel’s plans for environmental
management are strengthened annually. To plan
for better environmental management, Hyundai
Steel has also established, and is now running, an
environmental committee. Henceforth, Hyundai
Steel expects to strengthen the committee’s
activities.
2. Certified Management System Inspections
All workplaces in Hyundai Steel are run systemati-
cally under the certified management systems of
quality, environment, health and safety (ISO9001,
ISO14001, OHSAS18001). Internal inspections are
conducted twice yearly. These inspections
comply with the inspection checklist of the rele-
vant certifications and the company’s standards.
After each inspection, an inspection report is writ-
ten and any incongruence is reported to the
proper departments to receive recommendations
and to provide management with appropriate
counter-measures.
Hyundai Steel tests all factors that could have an
effect on the environment in all processes, manu-
facturing, sales, purchasing and usage of materi-
als, recycling and final disposal, in the environ-
mental impact assessment to prevent direct and
indirect causes of pollution in advance.
3. Training of employees and Green Purchase
Hyundai Steel includes education on the environ-
ment as part of employee training programs to
raise awareness of the environment and
employee abilities in environment-related work.
For more systematic training, Hyundai Steel has
even developed its own educational booklets
which we use in training. Each department is to
have various training programs included with in
their detailed training programs and must have an
employee in charge of environmental protection.
By running up to 20 training programs, concerning
the environment, Hyundai Steel hopes to have all
of its employees caring for the environment while
performing their jobs. Hyundai Steel also ensures
“Green Purchases” by buying products which
meet eco-friendly standards.
FROM NATURE BACK TO NATURE
We create value from nature by giving new life to it. Because of this, it is our duty
to preserve life whenever and wherever we can. By continuously recycling our
waste products and raw materials we have enshrined an ongoing process of
renewal in all our operations. This is only one part of our ethos of environmental
preservation, a quality we are proud of and view as a top management priority. It
is through this ongoing commitment that we aim to ensure a sustainable future
for the planet and for all mankind.
3435
Environmental results
Incheon Sewage recycling 4,546
Water supply 1,242
Pohang Industrial water 2,832
Water supply 261
Dangjin Industrial water 3,840
Water supply 652
Water Usage (’000 tonnes)
(’000 tonnes)
The amount of processed residual products
Slag 1,577
Refractory 32
Sludge 19
Dust(recycled) 40
Dust(reclaimed) 133
Rate of recycling (%) 88.9
2004 2005 2006 2007
Environmental pollution treatment costs
(unit : KRW billion)
31.0 33.1
55.8
34.4
2004 2005 2006 2007
Environmental management costs
(unit : KRW billion)
19.0
14.0
47.0
53.4

A STEP CLOSER TO TOMORROWHYUNDAI STEEL Annual Report 20073637
Raw materials
through
transportated by sea
Enclosed-loop Enclosed-loop Enclosed-loop Enclosed-loop
serialunloader beltconveyor beltconveyor
Actualwork process
raw materialsstorage house
4. Decreasing Pollutants
Hyundai Steel is striving to come up with the best
ways to decrease atmospheric, water and dust
pollutants. Hyundai Steel is not merely abiding by
current legislation, but has its own effective man-
agement system and is continuously investing to
improve the work environment. Hyundai Steel is
working towards greater energy efficiency, help-
ing this resource be used more effectively.
Hyundai Steel realizes that cutting fuel use is the
most fundamental factor in continuing develop-
ment. For this reason, Hyundai Steel has intro-
duced highly efficient facilities and is cutting
down on fuel consumption continuously. Hyundai
Steel continues to seek better ways of recycling
and currently recycles the most steel scrap in the
country. As a result, we see it as our duty to play
an important role in the cycling of nature.
Hyundai is also increasing efficiency in environ-
mental economics.
5. Developing Eco-Friendly Goods
The process of producing new steel products from
steel scrap is, in itself, an eco-friendly activity.
Hyundai Steel also believes that it is even more
important to put effort towards reducing the envi-
ronmental impact of harmful by-products pro-
duced during manufacturing and usage of steel
products. Hyundai Steel is applying processes
that consider all stages of the product life cycle.
For example, it is possible to save resources and
energy if more durable products are produced. It is
possible to reduce the negative impact on human
and natural eco-systems by eliminating harmful
substances.
Hyundai Steel also realizes that the development
of eco-friendly products is a key initiative for con-
tinuous development and is investing toward that
end. In order to produce eco-friendly products
under more pragmatic systems, Hyundai Steel
has established criterion for eco-friendly products
and is becoming increasingly eco-friendly through
the development process of our goods.
6. Building of World’s Optimally Eco-friendly
Integrated Steel Mills
The integrated steel mills being built at the
Dangjin Plant have implemented an eco-friendly
approach since the planning stage. It will be
equipped with the most up-to-date eco-friendly
facilities and pollution-free machinery and is
expected to coexist harmoniously with the local
human and wildlife population. On July 2, 2007,
Dangjin Plant opened a new era in eco-friendly
steel mills by introducing a new model of inte-
grated mills with a system for enclosed transferal
and storage of raw materials that decreases the
problems of dust pollutants. The enclosed system
of unloading materials (iron ore, coking coal) is a
first in the steel industry. This has never been
done in any other integrated mills anywhere in the
world. This ground-breaking concept will become
the benchmark for other integrated mills. The
enclosed chain unloading system and the
enclosed conveyor belt have entrapped dust pol-
lutants produced during transporting iron ore and
coking coal from the ship to the facilities where
the raw materials are needed.
FINANCIAL STATEMENTS
38
Independent Auditors’ Report
39
Non-Consolidated Balance Sheets
41
Non-Consolidated Statements of Income
42
Non-ConsolidatedStatementsofAppropriationofRetainedEarnings
43
Non-Consolidated Statements of Changes in Equity
44
Non-Consolidated Statements of Cash Flows
46
Notes to Non-Consolidated Financial Statements

NON-CONSOLIDATED BALANCE SHEETS
December 31, 2007 and 2006
2007 2006
Assets
Cash and cash equivalents ￦ 516,640 162,841
Short-term financial instruments 410,035 235,115
Short-term investments 9,181 70,000
Accounts and notes receivable - trade, less allowance
for doubtful accounts of ￦ 6,576 in 2007 and ￦ 7,070 in 2006 1,142,969 940,473
Inventories 1,155,322 763,502
Accounts and notes receivable - other, less allowance
for doubtful accounts of ￦ 800 in 2007 and ￦ 946 in 2006 1,097 9,754
Advance payments 18,550 40,708
Deferred tax assets - current - 1,048
Other current assets 14,631 10,519
Total current assets 3,268,425 2,233,960
Equity method accounted investments 1,369,195 1,292,490
Investment securities 258,891 168,562
Property, plant and equipment, net 3,815,755 3,249,147
Intangible assets 37,128 2,143
Other non-current assets 83,745 77,315
Total non-current assets 5,564,714 4,789,657
Total assets ￦ 8,833,139 7,023,617
(In millions of Won)
The Board of Directors and Stockholders
HYUNDAI STEEL COMPANY:
We have audited the accompanying non-consolidated balance sheets of HYUNDAI STEEL COMPANY (the “Company”) as of December 31, 2007 and 2006,
and the related non-consolidated statements of income, appropriation of retained earnings, and cash flows for the years then ended and the non-con-
solidated statement of changes in equity for the year ended December 31, 2007. These non-consolidated financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these non-consolidated financial statements based on our audits.
We conducted our audits in accordance with auditing standards accepted in the Republic of Korea. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the non-consolidated financial statements referred to above present fairly, in all material respects, the financial position of HYUNDAI
STEEL COMPANY as of December 31, 2007 and 2006, the results of its operations, the appropriation of its retained earnings, and its cash flows for the
years then ended, and the changes in its equity for the year ended December 31, 2007, in conformity with accounting principles generally accepted in
the Republic of Korea.
Without qualifying our opinion, we draw attention to the following:
As discussed in note 2(a) to the non-consolidated financial statements, accounting principles and auditing standards and their application in practice
vary among countries. The accompanying non-consolidated financial statements are not intended to present the financial position, results of opera-
tions and cash flows in accordance with accounting principles and practices generally accepted in countries other than the Republic of Korea. In addi-
tion, the procedures and practices utilized in the Republic of Korea to audit such non-consolidated financial statements may differ from those generally
accepted and applied in other countries. Accordingly, this report and the non-consolidated accompanying financial statements are for use by those
knowledgeable about Korean accounting principles and auditing standards and their application in practice.
Seoul, Korea
January 25, 2008
This report is effective as of January 25, 2008, the audit report date. Certain subsequent events or circumstances, which may occur between the audit report date and the time of read-
ing this report, could have a material impact on the accompanying non-consolidated financial statements and notes thereto. Accordingly, the readers of the audit report should under-
stand that there is a possibility that the above audit report may have to be revised to reflect the impact of such subsequent events or circumstances, if any.
INDEPENDENT AUDITORS’ REPORT
Based on a report originally issued in Korean

NON-CONSOLIDATED STATEMENTS OF INCOME
2007 2006
Sales ￦ 7,382,842 5,481,241
Cost of sales 6,325,033 4,572,167
Gross profit 1,057,809 909,074
Selling, general and administrative expenses 388,256 317,341
Operating income 669,553 591,733
Interest income 58,419 33,169
Interest expense (123,445) (106,195)
Loss on sale of available-for-sale securities, net (467) (3,282)
Foreign currency translation gain (loss), net (15,004) 12,751
Foreign currency transaction gain, net 3,502 25,828
Dividend income 349 392
Equity in income of equity method accounted investees 66,969 65,650
Loss on sale of equity method accounted investees (2,193) (723)
Gain on sale of property, plant and equipment, net 4,955 70,240
Reversal of impairment losses on investments 5,473 -
Gain on transactions of forward foreign exchange
contracts, net - 550
Unrealized loss on valuation of call and put options - (17,614)
Loss on prior period adjustments - (22,479)
Other, net 2,477 (6,741)
Other income 1,035 51,546
Income before income taxes 670,588 643,279
Income taxes 150,813 169,736
Net income ￦ 519,775 473,543
Earnings per share
Basic earnings per share ￦ 6,192 5,760
Diluted earnings per share ￦ 6,182 5,626
In millions of Won, except earnings per share
NON-CONSOLIDATED BALANCE SHEETS, CONTINUED
2007 2006
Liabilities and Equity
Liabilities
Short-term borrowings ￦ 753,002 518,892
Accounts and notes payable - trade 708,679 603,826
Current portion of long-term borrowings, net 42,070 76,157
Current portion of debentures issued, net 119,897 219,921
Accounts and notes payable - other 404,893 289,703
Advances from customers 38,314 21,359
Withholdings 33,954 21,989
Accrued expenses 71,475 59,894
Income taxes payable 123,409 105,384
Deferred tax liabilities - current 1,908 -
Total current liabilities 2,297,601 1,917,125
Long-term borrowings, net 513,495 155,565
Debentures issued, net 1,599,933 1,120,916
Accrual for retirement and severance benefits 76,622 89,071
Deferred tax liabilities 294,876 239,137
Other long-term liabilities 1,615 1,903
Total non-current liabilities 2,486,541 1,606,592
Total liabilities 4,784,142 3,523,717
Equity
Common stock of ￦ 5,000 par value
Authorized - 300,000,000 shares
Issued - 84,897,919 shares 424,490 424,490
Preferred stock of ￦ 5,000 per value
Issued and outstanding - 416,566 shares 2,083 2,083
Capital surplus 709,711 716,722
Capital adjustments (13,925) (13,203)
Accumulated other comprehensive income (loss) 79,686 (2,365)
Retained earnings 2,846,952 2,372,173
Total equity 4,048,997 3,499,900
Total liabilities and equity ￦ 8,833,139 7,023,617
In millions of Won, except share data

NON-CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Year ended December 31, 2007
NON-CONSOLIDATED STATEMENTS OF APPROPRIATION OF RETAINED EARNINGS
Years ended December 31, 2007 and 2006 / Date of Appropriation for 2007: March 14, 2008 / Date of Appropriation for 2006: March 9, 2007
2007 2006
Unappropriated retained earnings
Balance at beginning of year ￦ 8 8
Dividend to ISC Cayman - 2,005
Changes in equity in retained earnings of equity method
accounted investments (3,018) (573)
Net income 519,775 473,543
Balance at end of year before appropriation 516,765 474,983
Transfer from voluntary reserves
Reserve for social overhead capital investment 540 266
Unappropriated retained earnings available for appropriation 517,305 475,249
Appropriation of retained earnings
Legal reserve 4,198 4,198
Reserve for social overhead capital investment - 1,814
Discretionary reserve 470,000 427,251
Dividends - 10% on par value at 500 Won per share 41,978 41,978
516,176 475,241
Unappropriated retained earnings to be carried over to subsequent year ￦ 1,129 8
In millions of Won
Accumu-
lated other
Capital compre-
Capital Capital adjust- hensive Retained
stock surplus ments income earnings Total equity
Balance at January 1, 2007 ￦ 426,573 716,722 (13,203) (2,365) 2,372,173 3,499,900
Dividends - - - - (41,978) (41,978)
Balance after appropriation - - - - 2,330,195 3,457,922
Changes in equity in retained earnings of
equity method accounted investments - - - - (3,018) (3,018)
Net income - - - - 519,775 519,775
Loss on reissuance of treasury stock - (7,011) - - - (7,011)
Exercise of stock options - - (722) - - (722)
Change in fair value of available-for
-sale securities, net of tax - - - 55,360 - 55,360
Unrealized gain on valuation of equity
method accounted investments - - - 26,691 - 26,691
Balance at December 31, 2007 ￦ 426,573 709,711 (13,925) 79,686 2,846,952 4,048,997
In millions of Won

NON-CONSOLIDATED STATEMENTS OF CASH FLOWS
2007 2006
Cash flows from operating activities
Net income ￦ 519,775 473,543
Adjustments for:
Depreciation 251,765 208,845
Amortization 1,500 790
Bad debt expense 2,764 -
Provision for retirement and severance benefits 51,439 42,495
Equity in net income of equity method accounted investees (66,969) (65,650)
Gain on sale of property, plant and equipment, net (4,955) (70,240)
Loss on sale of available-for-sale securities, net 467 3,282
Loss on sale of equity method accounted investments 2,193 723
Reversal of impairment losses on investments (5,473) -
Foreign currency translation loss (gain), net 15,004 (12,759)
Unrealized loss on valuation of call and put options - 17,614
Loss on prior period adjustment - 22,479
767,510 621,122
Change in inventories (391,820) 58,396
Change in accounts and notes receivable - trade (206,982) (115,199)
Change in accounts and notes receivable - other 8,746 31,700
Change in accounts and notes payables - trade 104,362 (61,681)
Change in accounts and notes payables - other 114,972 144,441
Change in advance payments 7,269 22,094
Change in accrued expenses 11,581 2,990
Change in income taxes payable 18,026 56,067
Change in advances from customers 16,955 879
Change in withholdings 11,965 12,147
Change in deferred tax assets 1,048 (1,048)
Change in deferred tax liabilities 30,328 4,162
Payment of retirement and severance benefits (42,198) (14,276)
Others, net (8,287) (24,864)
Net cash provided by operating activities 443,475 736,930
In millions of Won
2007 2006
Cash flows from investing activities
Proceeds from sale of short-term financial instruments ￦ 635,425 -
Proceeds from sale of property, plant and equipment 14,165 90,803
Proceeds from sale of investment securities 70,002 18,109
Proceeds from dividends of equity method
accounted investments 20,723 23,171
Government subsidies 1,191 13,652
Acquisition of short-term financial instruments (810,345) (155,571)
Acquisition of property, plant and equipment (865,258) (743,677)
Acquisition of investment securities (18,147) (27,540)
Acquisition of equity method accounted investments - (59,762)
Other, net (6,134) (53,962)
Net cash used in investing activities (958,378) (894,777)
Cash flows from financing activities
Proceeds from short-term borrowings 1,380,280 -
Proceeds from issue of debentures 597,702 550,000
Proceeds from long-term borrowings 400,000 -
Proceeds from reissuance of treasury stock 1,197 -
Repayment of short-term borrowings (1,160,581) (133,438)
Redemption of current portion of debentures (220,000) (305,000)
Redemption of debentures - (2,505)
Repayment of current portion of long-term borrowings (76,328) (46,890)
Reacquisition of treasury stock (11,590) (4,933)
Dividends paid (41,978) (39,973)
Other, net - (983)
Net cash from financing activities 868,702 16,278
Net increase (decrease) in cash and cash equivalents 353,799 (141,569)
Cash and cash equivalents at beginning of year 162,841 304,410
Cash and cash equivalents at end of year ￦ 516,640 162,841
In millions of Won

(d) Inventories
Inventories are stated at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business,
less the estimated selling costs. The cost of inventories is determined as follows:
Steel and stainless steel products:
Finished goods, semi-finished goods, work-in-process Weighted-average method
Materials and supplies Moving-average method
Materials-in-transit Specific identification method
Cast steel and machinery products Specific identification method
Amounts of inventory written down to net realizable value due to losses occurring in the normal course of business are recognized as cost of goods sold
and are deducted as an allowance from the carrying value of inventories.
(e) Investments in Securities (excluding investments in associates, subsidiaries and joint ventures)
Classification
Upon acquisition, the Company classifies debt and equity securities (excluding investments in subsidiaries, associates and joint ventures) into the fol-
lowing categories: held-to-maturity, available-for-sale or trading securities. This classification is reassessed at each balance sheet date.
Investments in debt securities where the Company has the positive intent and ability to hold to maturity are classified as held-to-maturity. Securities
that are acquired principally for the purpose of selling in the short term are classified as trading securities. Investments not classified as either held-to-
maturity or trading securities are classified as available-for-sale securities.
Initial recognition
Investments in securities (excluding investments in subsidiaries, associates and joint ventures) are initially recognized at cost.
Subsequent measurement and income recognition
Trading securities are subsequently carried at fair value. Gains and losses arising from changes in the fair value of trading securities are included in the
income statement in the period in which they arise. Available-for-sale securities are subsequently carried at fair value. Gains and losses arising from
changes in the fair value of available-for-sale securities are recognized as accumulated other comprehensive income, net of tax, directly in equity.
Investments in available-for-sale securities that do not have readily determinable fair values are recognized at cost less impairment, if any. Held-to-
maturity investments are carried at amortized cost with interest income and expense recognized in the income statement using the effective interest
method.
Fair value information
The fair value of marketable securities is determined using quoted market prices as of the period end. Non-marketable debt securities are fair valued by
discounting cash flows using the prevailing market rates for debt with a similar credit risk and remaining maturity. Credit risk is determined using the
Company’s credit rating as announced by accredited credit rating agencies in Korea. The fair value of investments in money market funds is deter-
mined by investment management companies.
Presentation
Trading securities are presented as current assets. Available-for-sale securities, which mature within one year from the balance sheet date or where the
likelihood of disposal within one year from the balance sheet date is probable, are presented as current assets. Held-to-maturity securities, which
mature within one year from the balance sheet date, are presented as current assets. All other available-for-sale securities and held-to-maturity securi-
ties are presented as long-term investments.
NOTES TO NON-CONSOLIDATED FINANCIAL STATEMENTS
1. Organization and Description of Business
HYUNDAI STEEL COMPANY (the “Company”) was established in September 1964 under the laws of the Republic of Korea to manufacture and sell steel
and other industrial metal products. In March 2000, the Company mergered Kangwon Industries Co., Ltd. In October 2004, the Company acquired cer-
tain assets of Hanbo Steel Co., Ltd. As of December 31, 2007, the Company has three factories that are located in Incheon, Pohang and Dangjin, Korea.
In May 1987, the Company was listed on the Korea Exchange. The common and preferred stock of the Company amounts to W 424,490 million and W
2,083 million, respectively, as of December 31, 2007. Preferred shareholders are entitled to preferred dividends, and preferred shares shall be con-
verted to common stock after ten years of the date of issuance.
As of December 31, 2007, the Company’s major stockholders consist of Kia Motors Co., Ltd. (21.39%) and Mong-Ku Chung (12.58%).
2. Summary of Significant Accounting Policies and Basis of Presenting Financial Statements
(a) Basis of Presenting Financial Statements
The Company maintains its accounting records in Korean Won and prepares statutory non-consolidated financial statements in the Korean language in
conformity with accounting principles generally accepted in the Republic of Korea. Certain accounting principles applied by the Company that conform
with financial accounting standards and accounting principles in the Republic of Korea may not conform with generally accepted accounting principles
in other countries. Accordingly, these non-consolidated financial statements are intended solely for use by only those who are informed about Korean
accounting principles and practices. The accompanying non-consolidated financial statements have been condensed, restructured and translated into
English from the Korean language non-consolidated financial statements.
Certain information included in the Korean language financial statements, but not required for a fair presentation of the Company’s financial position,
results of operations or cash flows, is not presented in the accompanying non-consolidated financial statements.
Effective January 1, 2007, the Company adopted Statements of Korea Accounting Standards (“SKAS”), No. 21 (Preparation and Presentation of
Financial Statements), and No. 23 (Earnings per Share). Certain accounts of the prior year’s non-consolidated financial statements have been reclassi-
fied to conform to the current year’s presentation. These reclassifications have not resulted in any change to reported net income or stockholders’
equity.
(b) Changes in Presentation of Financial Statements
According to SKAS No. 21, Preparation and Presentation of Financial Statements, a statement of changes in equity has been included in the financial
statements and the capital adjustment account has been split into capital adjustments and accumulated other comprehensive income. Only the cur-
rent year's statement of changes in equity is required to be presented in the financial statements in the year of adoption of the standard. In addition,
earnings per share data are now presented as a separate item in the statement of income. A statement of comprehensive income has been included in
the notes to non-consolidated financial statements.
(c) Allowance for Doubtful Accounts and Restructured Accounts Receivable
Allowance for doubtful accounts is estimated based on an analysis of individual accounts and past experience of collection and presented as a deduc-
tion from trade receivables.
When the terms of trade accounts and notes receivable (the principal, interest rate or term) are varied, either through a court order, such as a reorgani-
zation, or by mutual formal agreement, resulting in a reduction in the present value of the future cash flows due to the Company, the difference
between the carrying value of the relevant accounts and notes receivable and the present value of the future cash flows is recognized as bad debt
expense.

Depreciation is computed by the straight-line method over the estimated useful lives of the assets as follows:
Useful lives (years)
Buildings 15 to 60 years
Structures 15 to 40 years
Machinery and equipment 10 to 15 years
Tools, furniture and fixtures 5 to 10 years
Vehicles 5 to 10 years
The Company capitalizes as part of the cost of qualifying assets interest costs on all borrowings incurred until the acquisition or construction of a quali-
fying asset is substantially complete and the asset is ready for its intended use.
The Company reviews property, plant and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount
of an asset may not be recoverable. An impairment loss is recognized when the expected estimated undiscounted future net cash flows from the use of
the asset and its eventual disposal are less than its carrying amount.
(h) Leases
The Company classifies and accounts for leases as either operating or capital leases, depending on the terms of the lease. Leases where the Company
assumes substantially all the risks and rewards of ownership are classified as capital leases. All other leases are classified as operating leases.
The assumption of substantially all the risks and rewards of ownership is evidenced when one or more of the criteria listed below are met:
- Ownership of the leased property will be transferred to the lessee at the end of the lease term
- The lessee has a bargain purchase option, and it is reasonably certain at the inception of the lease that the option will be exercised.
- The lease term is equal to 75% or more of the estimated economic useful life of the leased property.
- The present value at the beginning of the lease term of the minimum lease payments equals or exceeds 90% of the fair value of the leased
property.
In addition, if the leased property is specialized to the extent that only the lessee can use it without any major modification, it would be considered a
capital lease.
Where the Company is a lessee under a capital lease, the present value of future minimum lease payments is capitalized and a corresponding liability is
recognized. Payments made under operating leases are charged to the income statement on a straight-line basis over the period of the lease.
(i) Intangible Assets
An intangible asset is an asset where: (1) it is probable that future economic benefits that are attributable to the asset will flow into the entity and (2)
the cost of the asset can be measured reliably.
Intangible assets are stated at cost less accumulated amortization and impairment losses, if any. Impairment losses are determined as the amount
required to reduce the carrying amount of an intangible asset to its recoverable amount. Amortization on intangible assets is computed by the straight-
line method over a reasonable period, generally five to fifty years, based on the nature of the assets.
The criteria for determining whether an incurred cost qualifies as an intangible asset and the periods of amortization for each classification of intangible
asset are described below.
NOTES TO NON-CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
Impairment
The Company reviews investments in securities whenever events or changes in circumstances indicate that the carrying amount of the investments
may not be recoverable. Impairment losses are recognized when the reasonably estimated recoverable amounts are less than the carrying amount and
it is not obviously evidenced that impairment is unnecessary.
(f) Investments in Associates and Subsidiaries
Associates are all entities over which the Company has the ability to significantly influence the financial and operating policies and procedures, gener-
ally accompanying a shareholding of over 20 per cent of the voting rights. Subsidiaries are entities controlled by the Company. The existence of signifi-
cant influence is usually evidenced in one or more of the following ways:
- representation on the board of directors or equivalent governing body of the investee;
- participation in policy-making processes, including participation in decisions about dividends or other distributions;
- material transactions between the investor and the investee;
- interchange of managerial personnel; or
- provision of essential technical information.
Investments in associates and subsidiaries are accounted for using the equity method of accounting and are initially recognized at cost.
The Company’s investments in associates and subsidiaries include goodwill identified on acquisition (net of any accumulated impairment loss).
Goodwill is calculated as the excess of the acquisition cost of an investment in an associate or subsidiary over the Company’s share of the fair value of
the identifiable net assets acquired. Goodwill is amortized using the straight-line method over its estimated useful life. Amortization of goodwill is
recorded together with equity income (losses).
When events or circumstances indicate that the carrying value of goodwill may not be recoverable, the Company reviews goodwill for impairment and
records any impairment loss immediately in the statement of income.
The Company’s share of its post-acquisition profits or losses in investments in associates and subsidiaries is recognized in the income statement, and
its share of post-acquisition movements in equity is recognized in equity. The cumulative post-acquisition movements are adjusted against the carry-
ing amount of each investment. Changes in the carrying amount of an investment resulting from dividends by an associate or subsidiary are recog-
nized when the associate or subsidiary declares the dividend. When the Company’s share of losses in an associate or subsidiary equals or exceeds its
interest in the associate or subsidiary, including preferred stock or other long term loans and receivables issued by the associate or subsidiary, the
Company does not recognize further losses, unless it has incurred obligations or made payments on behalf of the associate or subsidiary.
Unrealized gains on transactions between the Company and its associates or subsidiaries are eliminated to the extent of the Company’s interest in
each associate or subsidiary.
(g) Property, Plant and Equipment
Property, plant and equipment are stated at cost, except in the case of revaluations made in accordance with the Asset Revaluation Law, which allowed
for asset revaluation prior to the Law being revoked. Assets acquired through investment in kind or donation are recorded at their fair value upon acqui-
sition. For assets acquired in exchange for a non-monetary asset, the fair value of the asset given up is used to measure the cost of the asset received
unless the fair value of the asset received is more clearly evident.
Significant additions or improvements extending useful lives of assets are capitalized. Normal maintenance and repairs are charged to expense as
incurred.

(m) Valuation of Receivables and Payables at Present Value
Receivables and payables arising from long-term cash loans/borrowings and other similar transactions are stated at present value. The difference
between the nominal value and present value of these receivables or payables is amortized using the effective interest method. The amount amortized
is included in interest expense or interest income.
(n) Foreign Currency Translation
Monetary assets and liabilities denominated in foreign currencies are translated into Korean Won at the balance sheet date, with the resulting gains or
losses recognized in the income statement. Monetary assets and liabilities denominated in foreign currencies are translated into Korean Won at W
938.2 to US$1, the rate of exchange on December 31, 2007 that is permitted by the Financial Accounting Standards. Non-monetary assets and liabili-
ties denominated in foreign currencies, which are stated at historical cost, are translated into Korean Won at the foreign exchange rate on the date of
the transaction.
Foreign currency assets and liabilities of foreign-based operations and companies accounted for using the equity method are translated at the rate of
exchange at the balance sheet date. Foreign currency amounts in the statement of income are translated using an average rate and foreign currency
balances in the capital account are translated using the historical rate. Translation gains and losses arising from collective translation of the foreign
currency financial statements of foreign-based operations are recorded net as accumulated other comprehensive income. These gains and losses are
subsequently recognized as income in the year the foreign operations or the companies are liquidated or sold.
NOTES TO NON-CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
(i) Intangible Assets, Continued
i. Research and Development Costs
To assess whether an internally generated intangible asset meets the criteria for recognition, the Company classifies the expense generation process
into a research phase and a development phase. All costs incurred during the research phase are expensed as incurred. Costs incurred during the devel-
opment phase are recognized as assets only if the following criteria are met for recognition in SKAS No. 3, Intangible Assets: (1) completion of the intan-
gible asset is technically feasible so that it will be available for use or sale; (2) the Company has the intention and ability to complete the intangible
asset and use or sell it; (3) there is evidence that the intangible asset will generate probable future economic benefit; (4) the Company has adequate
technical, financial and other resources to complete the development of the intangible asset and the intangible asset will be available; and (5) the
expenditures attributable to the intangible asset during its development can be reliably determined.
If the costs incurred fail to satisfy these criteria, they are recorded as expenses as incurred. Where development costs satisfy the criteria, they are cap-
italized and amortized on a straight-line basis. The expenditure capitalized includes the cost of materials, direct labor and an appropriate proportion of
overheads.
ii. Other Intangible Assets
Other intangible assets, which consist of industrial property rights, railroad usage rights, rights to utilization, software and wharf usage rights, are
amortized using the straight-line method over a reasonable period, generally five to fifty years, based on the nature of the asset.
(j) Contributions Received for Capital Expenditure
Contributions received from third parties for capital expenditure are presented as a reduction of the acquisition cost of the acquired assets and, accord-
ingly, reduce depreciation expense related to the acquired assets over their useful lives.
Income from grants that do not require the Company to fulfill any subsequent obligations and which is directly related to the Company's operating
activities is recognized as operating income, net of related costs. Other income from grants is recognized as other income.
(k) Discount on Debentures
Discount on debentures issued, which represents the difference between the face value and issuance price of debentures, is amortized using the effec-
tive interest method over the life of the debentures. The amount amortized is included in interest expense.
(l) Retirement and Severance Benefits
Employees who have been with the Company for more than one year are entitled to lump-sum payments based on current salary rates and length of
service when they leave the Company. The Company's estimated liability under the plan which would be payable if all employees left on the balance
sheet date is accrued in the accompanying non-consolidated balance sheets. A portion of the liability is covered by an employees’ severance benefits
trust where the employees have a vested interest in the deposit with the insurance company in trust. The deposit for severance benefits held in trust is,
therefore, reflected in the accompanying non-consolidated balance sheets as a reduction of the liability for retirement and severance benefits.
Through March 1999, under the National Pension Scheme of Korea, the Company transferred a certain portion of retirement allowances for employees
to the National Pension Fund. The amount transferred will reduce the retirement and severance benefit amount to be paid to the employees when they
leave the Company and is accordingly reflected in the accompanying non-consolidated financial statements as a reduction of the retirement and sever-
ance benefits liability. However, due to a new regulation effective April 1999, such transfers to the National Pension Fund are no longer required.

Credit Ratings
Hyundai Steel’s credit ratings improved by 1 basis point according to the Korea Ratings
Corporation, Korea Information Service Inc. and National Information & Credit Evaluation Inc.
Hyundai Steel’s credit ratings of non-guaranteed bonds and commercial paper were raised from
A0 to A++ and from A2 to A2++, respectively, due to secured gains, its ability in drawing cash, and
its control over the steel shaping market. As sales of hot rolled steel sheet increased by 10%,
from 2.9% the previous year, Hyundai Steel is expected to lead in external growth in the years
ahead.
The benefits of having raised credit ratings could lead to a reduction of financing costs for
Hyundai Steel, and a cut in issuance rates of bonds and commercial paper. Secondary benefits
could be an increase in the credit ratings by financial agencies and credit guarantee agencies,
strengthened competitive power in management, creditability in the market and the synergistic
effects of heightened company value. The increase in these new credit ratings could provide
even more secure support for our financial activities and could aid in the growing security of our
company's finances.
Financial Structure Analysis
Total Assets
In 2007, our total assets reached 8,833 billion KRW, an increase of 20.48% or 1,809 billion KRW
from 2006. Among current assets, cash and cash-equivalent assets increased by 354 billion
KRW or 217.27% from those of 2006. Inventories increased by 392billion KRW or 51.32%, from
2006. Among fixed assets, assets under construction, increased by 375 billion KRW, a 62.78%
increase from 2006.
Total Liabilities
Hyundai Steel's total liabilities mere 4,048 billion KRW, an increase of 549 billion KRW or 15.69%
from that of 2006. The main reason for this increase in liabilities was the investment into the
integrated mills in Dangjin. Corporate bonds increased by 480 billion KRW or 42.67%. Long-term
payable loans payable also increased by 358 billion KRW or 230.08%.
Total Shareholders' Equity
Our total capital stands at 4,048 billion KRW, an increase of 549 billion KRW (up 15.69%).
Retained Surplus earnings increased by 475 billion KRW, or 20.01% from 2006.
FINANCIAL REVIEW
AA-
A+
A
A-
BBB+
BBB
2008.01
2007.05
2005.04
2003.09
2002.02
2001.07
<
<
<
<
<
Credit Ratings of
Non-Guaranteed Bonds
2006 2007
Total Asset(billions of KRW)
8,833
7,024
2006 2007
Total Liabilities(billions of KRW)
4,784
3,524
2006 2007
Total Equity(billions of KRW)
4,049
3,500
(million tonnes)
2007 2008
Production:
2.7% increase
(crude steel +6.1%)
9.97
11.33
10.61
11.63
■Crude steel ■Product ■Domestic ■Export
Sales volume:
0.3% increase
(million tonnes)
2007 2008
11.25
9.40
1.85
9.57
1.70
11.27
■Domestic ■Export
Sales amount:
5.4% increase
(billions of KRW)
2007 2008
7,383
5,838
1,545
6,346
1,434
7,780
Prospects for 2008
In 2008, Hyundai Steel is expecting to see increased sales and operating profits through continued elec-
tric furnace operations and smooth progress in our investment in the integrated mills.
In 2007, performance in reinforced bar, steel shapes, hot rolled steel, stainless steel, and heavy indus-
tries and others amounted to 27.87%, 34.87%, 21.09% 7.04% 9.13% respectively in total sales. Nominal
consumption of reinforcing bar is expected to rise by 3.8% and to be 11,650 thousand tonnes in volume
and supply is expected to be tight due to lower inventory levels at the end of 2007, a decrease of Chinese
reinforcing bar imports and increased demand as a result of large public development works which are
about to begin in the Korean domestic market. The nominal consumption of steel shapes should increase
by 3.8% or 5,160 thousand tonnes in volume due to increased demand following the recovery of the
Korean domestic construction industry and stable growth in demand-side industries (e.g. shipbuilding).
As for hot rolled steel, nominal consumption is expected to rise by 6.1%, or 311million tonnes, due to
increasing demand following the establishment and extension of cold-rolled and steel pipe facilities.
In an effort to meet such market conditions, Hyundai Steel is restarting its 50-ton and 70-ton electric fur-
naces to increase production capacity and is turning to the development of high value-added goods (large
wide flange beams, extremely low-temperature and shock-proof shape steel for shipbuilding). In 2008,
Hyundai Steel is expecting to see increased total sales by 7,780 billion KRW an increase of 5.4%, to out-
strip sales of 2006, becoming the best performance so far in our history.

GROWTH TRACK
As a steel-maker aggressively committed to environmental awareness and eco-friendliness, Hyundai Steel is committed to balancing economic devel-
opment with environmental stewardship through the preservation of valuable resources and the full-recycling of scrap to manufacture its steel prod-
ucts.
As Korea’s first steel company, established in 1953, Hyundai Steel has since played a prominent role in the development of the local steel industry and
the overall domestic economy for the past five decades. Boasting a world-class product portfolio that includes products such as steel rod, angles &
channels, sheet steel, cast steel and cast iron rolls, etc., Hyundai Steel continues to maximize localization and expansion efforts through the acquisi-
tion of local steel companies and the ground breaking of its Integrated Steel Mills in Dangjin. Through these efforts, Hyundai Steel is now staged to
begin a new chapter in its history, with a large step closer to tomorrow, in its pursuit of becoming a leading global steel manufacturer.
Birth
Progress
Jun. 10, 1953
Established as Korea Heavy Industry Company.
May. 31, 1972
Started manufacturing Reinforcing Bar
Jul. 05, 1973
Commissioned 40-tonnes Electric Arc Furnace
Jun. 22, 1978
Incorporated into Hyundai Group
Mar. 27, 1979
Commissioned 60-tonnes Electric Arc Furnace
Exploration
Nov. 10, 1962
Renamed to Incheon Heavy Industry Co. Ltd.
(along with its privatization)
Sept. 21, 1964
Renamed Incheon Iron & Steel Company
Forward
Stability
Mar. 05, 1982
Commissioned Heavy Rolling Mills
Feb. 02, 1983
Commissioned Steel Casting Shop for Steel Casting
Feb. 28, 1985
Upgraded Electric Arc Furnace (from 40 tonnes to 50
tonnes)
May. 23, 1987
Listed on the Korean Stock Exchange
Mar. 15, 1990
Commissioned No. 1 Stainless Steel Cold Rolling Mills
(50,000 tonnes in annual capacity)
Sept. 15, 1990
Commissioned No. 2 Stainless Steel Cold Rolling Mills
(120,000 tonnes in annual capacity)
Jan. 30, 1992
Commissioned Expanded Wide Flange Beam Mills
Capacity to 1.1 Million Tons
Oct. 04, 1992
Became Official Member of International Iron & Steel
Institute (IISI)
Dec. 20, 1994
Commissioned 90-ton Electric Arc Furnace & No. 2
Reinforcing Bar Mills
Oct. 04, 1997
Completion of Technology Research Institute
Mar. 20, 1998
Commissioned 120-ton Electric Arc Furnace & New
Medium Rolling Mills
Mar. 15, 2000
Merged with Kangwon Industry Co. Ltd
Dec. 05, 2000
Acquisition of Sammi Steel Co. Ltd
Apr. 02, 2001
Incorporated into Hyundai Motors Group
Jul. 23, 2001
Changed Name to INI STEEL
Oct. 01, 2004
Acquisition of Hanbo Steel Co. Ltd.’s assets
May. 02, 2005
Commercial operation of A-Line Hot
Rolling Steel Mills in Dangjin
Leap Forward
Mar. 10, 2006
Changed Company Name from INI STEEL to HYUNDAI
STEEL Company
Oct. 27, 2006
Ground-breaking ceremony for Integrated Steel Mills
2007.04.16
Signed an agreement to provide shaft furnace facili-
ties (Paul Wurth, Luxemburg)
2007. 06.11
Completed A-hot Rolled steel 210mm slab casting
facilities in Dangjin Plant
2007. 12. 06
Singed an agreement for steelmaking operational
technology cooperation with ThyssenKrupp Steel
(TKS)
1953-1960
1961-1970
1971-1980
1981-1990
1991-2005
2006-2007
5455 Hyundai Steel Company Annual Report 2007 A STEP CLOSER TO TOMORROW

INCHEON PLANT
1, SONGHYUN-DONG, DONG-GU
INCHEON, 401-712, KOREA
TEL 82-32-760-2114
FAX 82-32-763-5046
POHANG PLANT
444, SONGNAE-DONG, NAM-GU
POHANG, 790-707, KOREA
TEL 82-54-271-1114
FAX 82-54-271-1241
DANGJIN PLANT
167-32, GODAE-RI, SONGAK-MYEON
DANGJIN-GUN,CHUNGCHEONGNAM-DO
KOREA
TEL 82-41-351-5114
FAX 82-41-356-5249
SEOUL OFFICE
231, YANGJAE-DONG,
SEOCHO-GU, SEOUL, KOREA
TEL 82-2-3464-6114
FAX 82-2-3464-6090
SEOUL SALES OFFICE
6, SINMUNNO-2GA, JONGNO-GU
SEOUL, 110-062, KOREA
TEL 82-2-722-2114
FAX 82-2-722-2109, 2091
BUSAN SALES TEAM
ROOM 1106, 11F, BUSAN DIGITAL VALLEY,
GAMJEON-DONG, SASANG-GU, BUSAN, KOREA
TEL 051-329-7238
FAX 051-329-7248~9
DAEGU SALES TEAM
8F, KYOBO BUILDING, 1, SUSEONGDONG 2-GA,
SUSEONG-GU, DAEGU, KOREA
TEL 053-745-1871~4
FAX 053-745-1875
DAEJEON SALES TEAM
UNAM BUILDING, 62-1,JEONG-DONG DAEDEOK-GU,
DAEJEON, KOREA
TEL 042-633-2061~3
FAX 042-636-0318
GWANGJU SALES TEAM
ROOM 501, 5F, KOREA CHAMBER OF COMMERCE &
INDUSTRY BUILDING NONGSEONG 2-DONG,
SEO-GU, GWANGJU, KOREA
TEL 062-351-8404~7
FAX 062-351-8644
QINGDAO PLANT(CHINA)
TWO AREA OF JIAOZHOUWAN INDUSTRY PARK
QINGDAO, SHANGDONG, CHINA
TEL 86-532-8727-3818
FAX 86-532-8727-3816
SINGAPORE
152 BEACH ROAD, #11-02
GATEWAY EAST, SINGAPORE 189721
TEL 65-6341-5080~1
FAX 65-6293-5083
BEIJING (CHINA)
ROOM 1603, XIAN DAI QI CHE DA SHA
#38 XIAO YUN ROAD, CHAO YANG
BEIJING, CHINA
TEL 86-10-8453-9228~9
FAX 86-10-6467-0706
LA (USA)
10550 TALBERT AVENUE FOUNTAIN VALLEY
CA 92728, USA
TEL 1-714-594-1699
FAX 1-714-594-1636
FRANKFURT (GERMANY)
KAISERLEIPROMENADE 5
63067 OFFENBACH, GERMANY
TEL 49-69-271472-790
FAX 49-69-271472-799
DUBAI (UAE)
AL RLQQA PALACE BUILDING #908
AL MAKTOUM STREET, DUBAI, UAE
TEL 971-4-227-8752
FAX 971-4-223-8396
TOKYO (JAPAN)
SHUWA SANBANCHO BUILDING
3F, 28 SANBANCHO CHIYODA-KU,
TOKYO 102-0075, JAPAN
TEL 81-3-5211-4410, 4412
FAX 81-3-5211-4413
HONG KONG
ROOM #6, UNITS NOS 1212-1215, 12TH FLOOR
THE METROPOLIS TOWER
NO.10 METROPOLIS DRIVE,
HUNGHOM, KOWLOON, HONG KONG
TEL 852-3162-5313
FAX 852-3162-5315
HANOI (VIETNAM)
ROOM601 , ICT BUILDING, 10/81 LINH
LANG STREET, HANOI, VIETNAM
TEL 84-4-766-7797
FAX 84-4-766-7812
Korean Domestic Network Overseas Network
GLOBAL NETWORK
Reaching the world and expanding the infinite
possibilities of steel
Tokyo, Japan
LA, USA
Qingdao Plant, China
Shanghai, China
Hongkong
Hanoi, Vietnam
Singapore
Beijing, China
Dubai, UAE
Frankfurt, Germany

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