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Annual Report of Celltrion GSC in 2012

From 1 January 2012


To
31 December 2012

.....................................................................................................................1
....................................................................................................2
I. ......................................................................................................................3
1. .....................................................................................................................3
2. .....................................................................................................................3
3. ..............................................................................................................3
4. ................................................................................................................5
5. .....................................................................................................................7
6. ........................................................................................................8
II. ....................................................................................................................9
III. .........................................................................................................20
IV. ..................................................................................................50
V. ........................................................................................52
VI. ..........................................................55
1. .......................................................................................................55
2. ....................................................................................................57
3. ....................................................................................58
4. .......................................................................................................58
VII. ........................................................................................................60
VIII. ......................................................................................61
1. ......................................................................................................61
2. ..............................................................................................................61
IX. .............................................................................................63
X. ...................................................................66
XI. .................................................................................................................68
XII. .................................................................................................................69
..........................................................................................................70
1. ...............................................................................................................70
2. .....................................................................................................70

Contents
Annual Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . .2
Confirmation of Executives. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . .. . . . . . . . . .4
I. Company Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . .6
1. Company Profile. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . .6
2. Company History. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . .. . . . . . . . .. . . . . . . . . .6
3. Change in Capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . .. . . . . . . . . .8
4. Total Number of Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . .. . . . 14
5. Status of Voting Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 18
6. Dividend Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . 20
II. Business Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . .22
III. Financial Issues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42
IV. Auditors Opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . .. . . . .. . 108
V. Operational Diagnosis and Analytic Opinions of the Chief Excecutive Officer. . . . . . . . . . .. . . . . . . . . .. ..112
VI. Related issues about the Company Departments (i.e. Board of Directors) and Subsidiaries.. . . . . . . . . . 116
1. Board of Directors. . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . .116
2. Supervision System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .121
3. The Voting Rights of Shareholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .122
4. Status of Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124
VII. Issues Concerning Shareholders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
VIII.Executives and Staff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . 128
1. Status of Executives and Staff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . .128
2. Remuneration of Executives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . .129
IX. Transactions with Stakeholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..132
X. Necessary Measures to Protect OtherInvestors. . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138
XI. Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .143
XII. Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . ..144
Confirmation of Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .146
1. Confirmation of Experts . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . .146
2. The Interest of Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . ..148

( 13 )

2012 01 01

2012 12 31


01

:
:

2013
:

04

()

13-3 5 (
)032-850-6464 ()
http://

( )

( ) (

)032-850-6464

Annual Report

(13th Period)
Financial year:1 January 2012 to 31 December 2011

Financial Services Commission (FSC)


Korea Exchange (KRX)

1 April 2013

Company: Celltrion GSC Corporation


CEO: Kim Tae-ku
Headquarter location:13-35th floor of Songdo-dong, Yeonsu-gu, Incheon (Tel) 032-850-6464
(Website) http://
Reporting Director:

(Position) (Name) Lee Byeong-lyur


(Tel) 032-850-6464

Executive Confirmation

As executives of the company and the people in charge of the preparation of the financial statements, we have
paid significant attention to the content of the financial statements covering this financial year. After direct
confirmation and discussions, we confirm that no record or note of major events was omitted and that there
were no false records or notes. Therefore, the contents of the report will not lead to major misunderstandings
for users.

Moreover, we confirm that the company has set up an internal accounting management system according to the
second and third paragraphs of the second article of The Law Concerning the External Audit of Corporations.
And the company has operated in compliance with this system.

29 March 2013 Celltrion GSC Corp.


CEO: Kim Tae-ku
Reporting Director: Lee Byeong-lyur

I.
1.
. . :
. : 2000.06.14
. : 13-3
5 : 032 - 850 - 6464
. :
. :

1.
2.
3. , , , , ,

4.
5.
6.
7.
8.


() ,
, ,

2.
.
(1)

2008.03.31

: () ()

2008.12.30

2009.01.12
2009.02.01
2009.02.27
2009.03.19
2009.04.02

1
(5,000 ) ( 1129-22
7-50) 2
(7,000 )

2010.11.30

( )
2 (2 @5,000)

2011.08.01

( 7-50 13-3)

(2)
- 2009 3 19
() () .

I Company Introduction
1. Company Profile
a) Legal name and business name of the company: Celltrion GSCCorporation
bDate of establishment: 14 June 2000
c Headquarter location: 13-3 5th floor of Songdo-dong, Yeonsu-gu, Incheon (tel) 032-850-6464
dScale: small to medium enterprise
eMajor business: business purposes in the Article of Association
Business purposes

Remarks

1. Manufacture recipients for medicine production


2. Research and development for materials localization
3. Trade and trade agency for medicine, pharmaceutical raw materials, chemicals,
medicines for external use, basic compounds and recipients for medicine
production
4. Overall business related to each phase
5. Wholesale equipment (machinery), parts and accessories
6. Manufacture pharmaceutical raw materials, chemicals, and basic compounds
7. Procurement and logistics consultancy
8. Procurement agency

2. Company History
a) Company History
(1) Changes After Company Establishment

Time
31 Mar 2008
Jan 12 2009
Feb 1 2009
Feb 27 2009
Mar 19 2009
Apr 2 2009
Nov 30 2010
Aug 1 2011

Process and major changes


Change of CEO: changed from Seo Jung-jin to Kim Tae-ku
For the first time the company issued unsecured convertible bonds with a value of KRW
5 BN
For the first time the company issued bearer bonds with non-detachable warrants with a
value of KRW 5 BN
The head office was moved from 1129-22 Guwol-dong, Namdong-gu, Incheon to 7-50
Songdo-dong, Yeonsu-gu, Incheon
The company issued unsecured convertible bonds with a value of KRW 7 BN for the
second time
The company name was changed from Nexolbiotech to Celltrion GSC
The company issued unsecured convertible bonds with a value of KRW 5 BN for the third
time
Equity investment from TOMATO 2 Savings Bank (2 million shares with aprice of KRW
5,000 per share)
The head office was moved from 7-50 Songdo-dong, Yeonsu-gu, Incheon to 13-3
Songdo-dong, Yeonsu-gu, Incheon

(2) The Change in Company Name


The company name was changed from Nexolbiotech toCelltrion GSC through a regular shareholders meeting on
19 March 2009

3.
()
( :

2012 12 31

()

()

2000
06
14
2001

04
04
2001
04
17
2001
09
25
2001
10
31
2002
03
23
2002
04
24
2012
10
10

( : , )
()

()

10,000

5,000

5,000

(
)

40,000

5,000

5,000

(
)

20,000

5,000

5,000

(
)

16,000

5,000

5,000

114,000

5,000

5,000

84,700

5,000

159,400

2,607,480

5,000

5,000

1,159,800

5,000

4,676

(
)
( 3
)

3. Changes in Capital
Capital increase/decrease
(Base date: 31 December 2012)

Unit: KRW, per share

Stock issuance/Decrease
Date of share
issuance/Decrease

Form of
issuance/Decrease

Category

Quantity

Par value
per share

Issuance/
Decrease price

Remarks

per Share

14Jun 2000

Capital increase with


consideration (rights
offering)

Common
stock

10,000

5,000

5,000

4 Apr 2001

Capital increase with


consideration (rights
offering)

Common
stock

40,000

5,000

5,000

17 Apr 2001

Capital increase with


consideration (rights
offering)

Common
stock

20,000

5,000

5,000

25 Sep 2001

Capital increase with


consideration (rights
offering)

Common
stock

16,000

5,000

5,000

31 Oct 2001

Capital increase with


consideration (rights
offering)

Common
stock

114,000

5,000

5,000

23 Mar 2002

Capital increase with


consideration (the
3rdoffering)

Common
stock

84,700

5,000

159,400

24 Apr 2002

Capital increase
without consideration

Common
stock

2,607,480

5,000

5,000

10 Oct 2002

Capital reduction

Common
stock

1,159,800

5,000

4,676

Share
Repurchase


( :

2012 12 31

2009 2015
02

02

27

26

7,000

2009 2013

04

04

02

01

5,000

12,000

( : , )

2010.3.1~

2013.02.25

2010.04.02~

2013.04.01

(%)

100

37,600

7,000

186,170

100

37,600

5,000

132,978

200

12,000

319,148

(*) .

Status of Outstanding Convertible Bonds


Base date: 31 December 2012Unit: KRW MN per share

Class

Date of Date of
issuance maturity

Total
book
value

Second

Registered

unsecured 27 Feb
convertible 2009

6 Feb
2013

7,000 common
stock

bonds
Third
unsecured 2 Apr
convertible 2009
bonds
Total

Period for Conversion conditions


Type of
possible
shares for
conversion Conversion
conversion
Conversion
claims
price
rate

Registered
1 Apr
2013
-

5,000 common
stock
12,000

1 Mar
2010~
25 Feb
2013
2 Apr
2010~

Outstanding bonds
Total
book
value

Shares for

Remarks

possible
conversion

100

37,600

7,000

186,170

100

37,600

5,000

132,978

200

12,000

319,148

1 Apr 2013
-

(*) Bondholders have the full exercise of the stock options

10


( :

2012 12 31

( : , )

(%)

(*) .

11

Status of Outstanding Bonds with Warrants


Base date: 31 Dec 2012Unit: KRW MN per share

Class

XXX
unregistered
bonds with
detachable
warrants
Total

Total
book
value

Unit: KRW MN, %

Type of
shares

Bonds which have


Exercise conditions
Period for
not been exercised
possible
Shares Remarks
exercise
Total
for
of options Exercise Exercise
book
price
rate
possible
value
exercise

Date of
issue

Date of
maturity

(*)Early repayment of detachable warrants before December 31 2010has been completed

12

4.

( :

2012 12 31 )

( : )

4,000,000

4,000,000

2,892,180

2,892,180

1,159,800

1,159,800

1,159,800

1,159,800

2.

3.

4.

1,732,380

1,732,380

233

233

1,732,147

1,732,147

1.

. (-)
.
. (-)

13

4. The total number of shares

Status of Total Number of Shares


Base date: 31 Dec 2012

Unit: per share


Type of share

Division

Common stock Preferred stock

Remarks

Total

. Total number of issued shares

4,000,000

4,000,000

. Total number of shares issued to date

2,892,180

2,892,180

. Total number of shares which decreased


to date

1,159,800

1,159,800

1. Capital reduction

1,159,800

1,159,800

2. Profit redemption

3. Repayment of redeemable shares

4. Others

1,732,380

1,732,380

233

233

1,732,147

1,732,147

.Total number of outstanding shares


. Self-owned shares
. Number of outstanding shares

14


( :

2012 12 31 )

( : )


(+)

(-)

(-)

233

233

233

233

(a)

(b)

(c)

(a+b+c)

) 2002 4 24

15

Status of the Acquisition and Disposal of Own Shares


Base date: 31 Dec 2012

Unit: per share

Acquisition method

exchange

OTC direct

Acquisition from

Acquisition

Direct

within the acquisition


range of

Quantity change
Type of Basic
Final
Remarks
stocks quantity Acquisitio Disposal Redemption quantity
n

acquisition
Public Purchase

available

Subtotal (a)

for

Quantity held by
trustees

233

233

233

233

profit

dividned Acquisition
through Current holding
quantity
trust
agreement
Subtotal (b)
Acquisition through other methods (c)
Total

Other Acquisition) acquired odd lot (fractional-lot) stocks when increase of capitalstock without consideration
on April, 24 2002

16

5.

( :

2012 12 31

( : )

1,732,380

233

(F

1,732,147

= A - B - C - D + E)

(A)
(B)

(C)

(D)
(E)

17

5. Voting Status
Base date: 31 Dec 2012
Division
Total number of issued shares (A)
Number of shares without voting rights
(B)
Number of shares without voting rights
due to the commercial laws within the
companys articles of incorporation (C)
Number of shares with limited voting
rights according to other laws (D)

Unit: per share


Type of stocks

Number of shares

Remarks

Common stock

1,732,380

Preferred stock

Common stock

Preferred stock

Common stock

Preferred stock

Common stock

233

Preferred stock

Number of shares with resurrected voting


rights (E)

Common stock

Preferred stock

Number of shares with voting rights

Common stock

1,732,147

(F = A - B - C - D + E)

Preferred stock

18

6.
3

()

13

12

11

5,000

5,000

5,000

101,458

-6,347

6,830

58,574

-3,664

3,943

()

()

(%)

()
()

(%)
(%)
()
()

19

6. Matters Concerning Dividends


Dividend Repayments in the Past 3 Years
Division

Type of stocks

Par value per share (KRW)

13th Period

12th Period

11th Period

5,000

5,000

5,000

101,458

-6,347

6,830

58,574

-3,664

3,943

Total cash dividends (million KRW)

Total stock dividends

Cash dividend payout

Common stock

Preferred stock

Common stock

Preferred stock

Common stock

Preferred stock

Common stock

Preferred stock

Net profit of the period (million KRW)


Earnings per share

Cash dividend yield

Stock dividend yield (%)


Cash dividend per share
(KRW)
Stock dividend per share
(per share)

20

II.
1.
.
, 2~3%
15% ,
25%, 35%,
65% .
. .
,

.
Generic
,
Original
.


Project
Project (, ) ,
,
Bio Project Project
,

Business Model ,
Bio Project ,




21 Bio
.
.
-
2000 6 ,
, ,


,
21

II. Business Overview


1. Business Overview
a) Industry Status
In recent years, investments in R&D in domestic pharmaceuticals and life science companies have accounted
for 2-3% of the companys revenues, far below the R&D investment of multi-national pharmaceutical
businesses, in which R&D typically accounts for nearly 15% of revenue. Technically, the development of new
material technologies is only 25% that of developed countries. Our production technology is underdeveloped.
The development of domestic bioengineering and biotechnology is only 35-65% that of developed countries.
Many bioventure companies have emerging during these years mainly thanks to the governments
encouragement to develop this venture industry. These companies are committed to research and development
on the basis of unique technologies. In addition, large domestic pharmaceutical companies have developed
revolutionary medicine. To be accepted into the international market, they have conducted clinical experiments
on human subjects in specialized international clinical research organizations. However, at the moment they are
inexperienced and face many difficulties.
Granted the exclusive patents of advanced pharmaceutical companies in South Korea, we focus on the
development of generic medicine in the domestic market and maintaining stable sales and profit. However,
due to the recent medical reform separating the prescribing and dispensing of drugs, prescriptions for foreign
original medicine have increased. As a result, domestic pharmaceutical companies are in a worse situation
with decreasing R&D investment and may even lose opportunities to develop new medicines.
To avoid this dire situation and to promote the development of the domestic biological industry:
South Korean companies should take advantage of its own high-quality talent and low production structure
to set up a domestic production base through cooperation with foreign companies which possess advanced
technologies and products. They can also make a profit through projects that are under development or
are undergoing commercialization, as well as through direct or indirect investments in products (medicine,
medicine for external use, etc.).
We should seek out profitable overseas bio projects and create opportunities for domestic investors to
participate in them. This way, investors can make a profit, and at the same time technology transfers will
become possible.
We should see to it that excellent domestic bioventure companies possessing their own technologies
receive adequate financial support by attracting investment, so that their business models can be scaled
and industrialized.
We should help domestic bioventures, which possess self-developed technologies, to attract investment,
which helps them industrialize their business. We should promote our business through direct or indirect
investments in profitable domestic and overseas bio projects, and by securing elusive patents in other
countries and regions. On one hand, we should do research on basic bioengineering technologies and
make investments in production infrastructure; on the other hand, we should attract advanced foreign
companies to build local bases for mass production and gradually advance the development of profitable
technologies. In this way, we can upgrade the biological industry the sunrise industry with high added
value in the 21stcentury into a mainstream national industry which boasts competitive strength.
b) Company Status

Biotechnology investment projects

Established in June 2000, our company relies on international talent with years of experience in the planning
and proposal of overseas projects. We focus on developed countries and regions, including the US, Europe and
Japan.
Ourcompany is seeking companies engaged in promising biotechnology projects, appraising their research
programs, making direct investments and maintaining investments from domestic investors.
22


, ,
,
.
1 (VaxGen)
(Mammalian Cell-Culture Technology)
(Therapeutic Proteins) ,
()
,
,

.
-

,

.

, 2
.
,
,
, , ColdChain ,
,
.
-

.
1 .

..

Cold-Chain CRO

,

.
, Cold-Chain
Knowhow Cold-Chain
Gloval .

23

Ourcompany combines foreign companies which possess advanced biotechnology with domestic capital, and
plans and promotes the establishment of joint ventures in South Korea.
Our company is engaged in the procurement of raw materials for biopharmaceutical production from
domestic and overseas suppliers, as well as the distribution of these products.
Our companys first investment project is a good example. In order to develop various therapeutic proteins for
the production of vaccines and anticancer drugs, it used the Mammalian Cell-Culture Technology of the VaxGen
Company, and established a joint venture named Celltrion. Our company will build on this achievement and
continue to promote profitable new projects.
- The localization of excipients for biopharmaceutical production
The demand for equipment for biopharmaceutical production is increasing sharply worldwide, and the market
for raw materials and excipients will expand along with it. It is necessary to purchase raw materials for
biopharmaceutical production from domestic and foreign suppliers, and upgrade the relevant distribution
channels.
In order to adjust to the change in business structure and maintain quality and price competivemess, our
company is planning to carry out its second round of commercial projects, aiming at the localization of
excipients for biopharmaceutical production.
To this end, our company plans to promote cooperation with overseas companies to establish joint efforts to
promote the technologies necessary for the development of these materials, since most raw materials and
excipients for basic biopharmaceutical production are imported from overseas. Meanwhile, it will advance the
localization of these materials and expand its Asian market through the diversification of material production,
investment in cold-chain logistics, and the construction of domestic bases for material production.

Procurement of reference drug

In physical and chemical comparison tests and clinical trials with originators, control tests are crucial for the
development of biosimilars. Notably, the number of reference drugs used in the clinical trials of biosimilars is
even larger than the total of those used in several Eastern European countries over an entire year. It is a wellknown fact that the pharmaceutical companies from which drugs originate from usually restrict the purchase of
reference drugs in order to impede the development of biosimilars.
Since its establishment, our company has run overseas projects for many years. With a chain of networks
and cold-chain operation capabilities, we first started the business of bulk purchasing reference drugs with
a price advantage, which is hard to achieve even for specialized international clinical research organizations.
Moreover, we continue to supply the development and clinical use of biosimilars. Recently, we have
expanded our business in Japan, including the supplying of reference drugs for domestic clinical use and
ordering products from Japanese pharmaceutical companies. Since many domestic and foreign companies
may eventually transition towards biosimilar production, our company plans to increase its purchases of
reference drugs, as well as expand our global cold chain distribution capabilities through our overseas
network and reference drug suppliers.

24

2.
.
( : , %)

()

()

Air fillter

8,556(55.26)

1,420(48.93)

4,869(31.45)

570(19.64)

API

268(1.73)

29(0.99)

198(1.27)

5(0.17)

149(0.96)

12(0.41)

1,441(9.30)

866(29.84)

15,481(100.00)

2,902(100.00)

.
( : , %)

13

12

84

0.54

13

0.08

97

0.62

15,384

99.37

27,824

100.00

15,384

99.37

27,824

100.00

15,481

100.00

27,824

100.00

25

2. Sales Details
a) Status of Major Products
Unit: KRW MN, %
Division

Business Sectors

Sales (Percentage)

Gross Profit
(percentage)

Remarks

Air filters

8,556(55.26)

1,420(48.93)

Biosimilars

4,869(31.45)

570(19.64)

API

268(1.73)

29(0.99)

Machinery

198(1.27)

5(0.17)

Others

149(0.96)

12(0.41)

1,441(9.30)

866(29.84)

15,481(100.00)

2,902(100.00)

Services
Total

Total

b) Sales Breakdown by Sales Method


Unit: KRW MN, %

Categories

Export
sales

Sales

12th Period
Sales

Percentage

Percentage

Sales of products not produced


by Celltrion GSC

84

0.54

Sales of services

13

0.08

Sales of agent products

Others

97

0.62
27,824

100.00

Subtotal

Domestic
Sales

13th Period

Sales of products not produced


by Celltrion GSC
Sales of services

15,384
-

Sales of agent products

Others

27,824

100.00

27,824

100.00

Subtotal
Total

15,384
15,481

1
0

26

.
(1)
AIR FILTER

(2)

27

c) Sales Channels and Sales Methods


(1) Sales Organization
Air filters

In-house direct sales

Reference drugs, etc.

In-house direct sales

Plastic greenhouse materials

In-house direct sales

(2) Sales Channels

Suppliers (domestic and


overseas)

The company

Clients

Korean branches of foreign


companies

28

(3)
- :
- : (15 1 ) 15

(4)
-
-
3.
. ()
( : , %)

13

12

Air fillter

8,556

55.26

4,869

31.45

API

268

1.73

5,030

18.07

19,790

71.12

55

0.19

198

1.27

2,597

9.33

84

0.54

65

0.41

352

1.26

13

0.08

1,428

9.22

15,481

100.00

27,824

100.00

29

(3)Sales Methods and Conditions


Sales methods: supplies based on supply contracts or orders from customers
Payment terms: after settling sales with customers (within 15 days to one month), cash payments should
be made within 15 days; after monthly sales settlements with customers, cash payments should be made
no later than the last day of the next month
(4) Sales Strategy
Cooperate with target corporate clients and expand market by expanding the variety of applicable products
Strict quality control and just-in-time management of the import and supply chains

3. Sales Results
a) Export (Domestic Sales) by Category
Unit: KRW MN, %
Item

Categories

13thPeriod
Amount

12thPeriod

Percentage (%)

Export
Air filters
Biosimilars

Domestic sales

8,556

55.26

Export
Domestic sales

4,869

31.45

Export
API

Domestic sales

268

1.73

Export
Machinery

Others

Services

Amount

Percentage (%)
-

5,030

18.07

19,790

71.12

55

0.19

Domestic sales

198

1.27

2,597

9.33

Export

84

0.54

Domestic sales

65

0.41

352

1.26

Export

13

0.08

1,428

9.22

15,481

100.00

27,824

100.00

Domestic sales
Total

30

. ()
( : , %)

Air fillter

API

13

12

6,869

61.30

4,457

16.74

3,963

35.36

19,271

72.40

15

0.06

40

0.35

136

0.51

65

0.58

49

0.18

99

0.88

1,242

4.66

33

0.29

1,119

4.20

64

0.57

328

1.23

72

0.64

11,205

100.00

26,617

100.00

. ()
( : , % )

Air fillter

API

8,556

55.26

4,869

31.45

268

1.73

198

1.27

84

0.54

65

0.41

13

0.08

1,428

9.22

15,481

100.00

31

b) Import (domestic purchase) by category

Item

Categories

Unit: KRW MN, %

13th Period
Amount

12th Period
Amount

Percentage (%)

Percentage (%)

Import
Domestic
purchase

Air filters

Machinery

Others

6,869

61.30

4,457

16.74

3,963

35.36

19,271

72.40

15

0.06

Import

40

0.35

136

0.51

Domestic
purchase

65

0.58

49

0.18

Import

99

0.88

1,242

4.66

Domestic
purchase

33

0.29

1,119

4.20

Import

64

0.57

328

1.23

Domestic
purchase

72

0.64

11,205

100.00

26,617

100.00

Import
Comparison pills
for
Bioequivalence Domestic
purchase
Test
(Biosimilars)

API

Total

c) Export (Domestic Sales) by Business Region


Unit: KRW MN, %
Item
Air filters

Categories

Target country

Export

Domestic sales

Domestic

Export
Comparison pills
for
Bioequivalence
Domestic sales
Test
(Biosimilars)

API

Machinery

Others

Domestic

Percentage

Remarks

8,556

55.26

4,869

31.45

268

1.73

Export

Domestic sales

Domestic

Export

Domestic sales

Domestic

198

1.27

Export

Russia

84

0.54

Domestic sales

Domestic

65

0.41

Japan

13

0.08

1,428

9.22

15,481

100.00

Export
Services

Amount

Domestic sales
Total

Domestic
-

32

. ()
( : , %)

API

18.75

98

0.87

1,588

14.17

23

0.20

56

0.49

55

0.49

39

0.34

0.01

6,869

61.30

99

0.88

33

0.29

40

0.35

65

0.58

64

0.57

72

0.64

11,205

100.00

Air fillter

2,102

33

d) Import (Domestic Purchase) by Business Region

Item

Categories

Target country
Germany

Others

Remarks

98

0.87

1,588

14.17

Mexico

23

0.20

U.S.

56

0.49

Austria

55

0.49

Netherlands

39

0.34

Hong Kong

0.01

Domestic purchase

Domestic

Import

Domestic purchase

Domestic

6,869

61.30

Import

Germany

99

0.88

Domestic purchase

Domestic

33

0.29

Import

India

40

0.35

Domestic purchase

Domestic

65

0.58

Import

U.S.

64

0.57

Domestic purchase

Domestic

72

0.64

Comparison pills
for
Bioequivalence
Test
(Biosimilars)

API

Percentage
18.75

U.K.

Machinery

Amount
2,102

Switzerland

Air filters

Unit: KRW MN, %

Import

Total

100.00

34

4.
.
(1)
( : , )

43

43

*
(2)
( )
(3)
( )
.
( )
.
(1)
( )
(2)
( : )

14

15

16

130

50

30

50

17,500

15,000

1,000

1,500

17,630

15,050

1,030

1,550

35

4. Status of Operation Equipment


a) Status of Commercial Equipment
(1) Domestic
Unit: KRW MN

Category

Number of
employees

Location

Land

Building

Total

IncheonYeonsu Songdo

43

43

Total

Remarks

* The rented HQ office is in use


(2) Overseas
No related issue
(3) Plans for Establishment of New Branches
No related issue
b) Other Commercial Equipment
No related issue
c) Plans for Purchasing New Equipment
(1) Ongoing investment
No related issue
(2) Future Investment Plans
Unit: KRW MN
Business
sector

Name of
plan

Total expected Investment

Investment effect
Assets from

Equipment Equipment, etc.


Investment
Total

Total expected investment

Security

Amount

th

th

Remarks

th

14 Period 15 Period 16 Period

130

50

30

50

17,500

15,000

1,000

1,500

17,630

15,050

1,030

1,550

Improved office
efficiency
New business

36

5.

2011.04.29

()

2011.05.05

CELLTRION DON LLC ()

2011.05.30

CELLTRION CO.,LTD.

2011.06.29

2011.06.29 Master Supply Agreement

Nippon Kayaku

2012-01-13 Werehouse Service Agreement

()

2012.02-06

CELLTRION DON LLC ()

2012-02-03

2012-06-07 Confidentiality & non_disclosure agreement

PDP Courier, Jupiter Express

2012-08-02 Confidentiality & non_disclosure agreement

UPS Supply Chain Solutions

2012-09-27 Confidentiality & non_disclosure agreement

2012-10-18 SHARE PERCHASE AGREEMENT

ORIX CORPORATION

2012-11-27

()

2012-12-01

()

2012-12-10

2012-12-26

2012-12-28

()

2012-12-28

()

37

5. Major Operating Contracts, etc.

Category

Contract date

Contract content

Project construction
contract

Contracts for plastic greenhouse


29 Apr 2011 construction and supplementary
services in Russia

Project construction
contract

5 May 2011

Purchase contract

30 May 2011 Purchase contract for generics

Trust contract for


assets management

29 Jun 2011

Trust contract for the management of


fixed benefit pensions

Purchase contract

29 Jun 2011

Master Supply Agreement

Service contract for plastic greenhouse


construction in Russia

Counterparty
Bogwang Construction
Corporation
Russian legal person
Celltrion Co.,Ltd.
Hana Bank
Nippon Kayaku

Contract for
Luggagestorage
and

13 Jan 2012 Warehouse Service Agreement

Modern General Motors


Corporation, Ltd.

transportstation
Contract for good
supply

6 Feb 2012

Good Supply Agreement

Purchase contract

3 Feb 2012

Agreement on the purchase of


Russianexportgoods

Nanjing Dong

Transport contract

7 Jun 2012

Confidentiality & nondisclosure


agreement

PDP Courier, Jupiter Express

Transport contract

2 Aug 2012

Confidentiality & nondisclosure


agreement

UPS Supply Chain Solutions

Transport contract

27 Sep 2012

Confidentiality & nondisclosure


agreement

Korean Air

Block deal

18 Oct 2012 Share purchase agreement

Investment contract

27 Nov 2012 Advance payment agreement

Service contract

1 Dec 2012

Dispatch of contract workers

CELLTRION DON LLC (Russian


Subsidiary)

ORIX Corporation
SeoulInvestmentClubLtd.
FreeZone

Comprehensive Cash Balance


Monetary agreement 10 Dec 2012 Agreement (cash consumption, money
borrowing/lending)

RainbowIndianapolis, Ltd.

Comprehensive Cash Balance


Monetary agreement 26 Dec 2012 Agreement (cash consumption, money
borrowing/lending)

In andOut, Ltd.

Service contract

28 Dec2012 Business support contract

Celltrion, Ltd.

Service contract

28 Dec 2012 Business support contract

Celltrion Health Care, Ltd.

38

6.
()
7.
.
[]

( : )

23,024

90

90

23,024

16,435

40,000

2,435

54,000

39,459

40,090

2,525

77,024

()

()

22,000

10,000

12,000

()

8,662

8,662

()

()

()

30,662

10,000

20,662

5,400

43,200

5,440

43,160

75,521

83,290

17,965

140,846

( )

:
:

12,000

. 3
( )
.
2013 2 4 720,000 (
80%) 13,200 2013 3 8
.

39

6. Research and Development Activities


No related issue
7. Other information necessary for investment decisions
a) Summary of External Financing
Domestic Financing
Financing source
Banks

Unit: KRW MN
Beginning
balance

New financing

Reduction
through
repayment

End balance

23,024

90

90

23,024

Insurance companies

Comprehensive financial companies

Commercial credit companies

Mutual savings banks

16,435

40,000

2,435

54,000

39,459

40,090

2,525

77,024

22,000

10,000

12,000

8,662

8,662

Share offering (private placement)

Asset securitization (public offering)

Asset securitization (private


placement)

Others

30,662

10,000

20,662

5,400

43,200

5,440

43,160

75,521

83,290

17,965

140,846

Other financial institutions


Subtotal of financial institutions
Corporate bonds (public offering)
Corporate bonds (private placement)
Share offering (public offering)

Subtotal of capital market


Shareholders, executives, subsidiary
borrowings
Other
Total

Remarks

(Reference) total number of corporate bonds issued in this period


Public offering:
KRW MN
Private placement: KRW 12,000 MN
b) Credit Rating in the Past Three Years
(N/A)
c) Other Important Matters
After the end of the business, the company signed a contract to acquire 720,000 (equity ratio 80%) shares of
Hanskins common stock with KRW 13,200 MN(USD 13.2 MN) on 4 February 2013, and completed the
acquisition on 8 March 2013.

40

III.
1.
( : )

13

12

[]

103,594,997,365

51,407,776,236

103,594,997,365

50,609,602,339

798,173,897

[]

485,012,004,781

380,440,887,128

484,999,196,978

380,439,397,058

5,099,134

1,203,334

7,708,669

286,736

588,607,002,146

431,848,663,364

185,787,797,761

82,992,980,938

70,839,835,872

81,748,492,374

256,627,633,633

164,741,473,312

8,661,900,000

8,661,900,000

597,333,772

597,333,772

(130,144,180)

(130,144,180)

225,183,859,461

261,769,792,184

97,666,419,460

(3,791,691,724)

331,979,368,513

267,107,190,052

15,481,246,329

27,824,376,329

1,589,982,836

903,419,671

134,386,703,228

(7,101,232,091)

101,458,111,184

(6,347,194,424)

[]
[]

[]
[]
[]
[]
[]

41

III.Financial Status
1. Financial Summary
(Unit: KRW)
Division

12th Period

13th Period

Current assets

103,594,997,365

51,407,776,236

Quick assets

103,594,997,365

50,609,602,339

798,173,897

Non-current assets

485,012,004,781

380,440,887,128

Investment assets

484,999,196,978

380,439,397,058

Tangible assets

5,099,134

1,203,334

Intangible assets

7,708,669

286,736

Total assets

588,607,002,146

431,848,663,364

Current liabilities

185,787,797,761

82,992,980,938

70,839,835,872

81,748,492,374

256,627,633,633

164,741,473,312

8,661,900,000

8,661,900,000

597,333,772

597,333,772

(130,144,180)

(130,144,180)

225,183,859,461

261,769,792,184

97,666,419,460

(3,791,691,724)

331,979,368,513

267,107,190,052

15,481,246,329

27,824,376,329

1,589,982,836

903,419,671

Profit from continuous


operation

134,386,703,228

(7,101,232,091)

Net profit

101,458,111,184

(6,347,194,424)

Inventories

Non-current liabilities
Total liabilities
Equity
Capital surplus
Capital adjustment
Other accumulated
comprehensive income
Retained earnings
Total equity
Sales revenue
Operating income

42

2.
1).
.
, .
2011 1 1
. '
.
.
.
21 '' 21.5 2

. ,
36,937 ,
36,937 .
.
,
, ,
.
.
,

,
, .

, ,
.
.
,

( ) 3

43

2. Attention in the Use of Financial Statements


1) Financial Statement Creation Criteria and Significant Accounting Policy
The important accounting policy for financial statement creation is written below. These policies are
continuously applied throughout the noted accounting periods unless specifically noted otherwise.
The company has applied the Private Sector Accounting Principles from the annual report period since 1 January
2011. Private Sector Accounting Principles is the standard that is applied to firms that are among the firms
subject to Corporate External Auditing Law and are not conducting their accounting according to K-IFRS.
The applied important accounting policies for the creation of financial statements are the following:
a) Change of Accounting Policy
Due to the amendment of Private Sector Accounting Principles, page 21, Employee Benefit paragraphs 21.5, 2,
the company now recognizes the expenses and liabilities related to annual paid leave during the accounting
periods when staff provide the services that generate the rights to annual paid leave. The amendment is
effective starting this accounting period. Therefore, the companys current year-end assets were decreased by
KRW 36,936,000 (USD 36,937) and companys current year-end profit was decreased by KRW 36,937,000
(USD 36,937).
b) Profit Recognition Criteria
The company uses fair value to forecast the revenue generated from the sale of goods, rendering of services, and
use of the assets. When forecasting the revenue, the value-added taxes, sale allowance, rebates and discounts
was subtracted. The company recognizes revenue when the amount of revenue can be reliably measured and it is
probable that future economic benefits will flow to the entity.
Revenue from the sale of goods is recognized when the risks and rewards are transferred to the buyer and
when there is an ownership of the goods sold and when common administration or effective control cannot be
done, and when costs incurred or will be incurred due to the amount of revenue and transactions can be
estimated credibly with a very high probability of economic benefits inflow.
Revenue from the provision of services is recognized according to the accounting policy when the entire
amount of revenue and progress can be reliably estimated, when there is a high probability of economic
benefit inflow, and when incurred expenses and transactions costs can be reliably estimated.
c) Cash and Cashable Assets
The company is treating Cash and Cashable Assets (cash equivalents when substitute securities (like currency
and checks), checking accounts, ordinary deposits and financial instruments that can be easily converted to
cash with a low risk of change of value due to interest change and when the contract period (or repayment
period) is less than three months.

44

.

.
,
, .
,
.
.
1
, ,
.

.

, .,
. ,

,
.
.
,
,
. ,
. ,

1
.
,
, ,
.
,

.
45

d) Allowance for Bad Debts


For account receivables bearing repayment risk, the company estimates the bad debt amount and sets a bad
debt reserve based on reasonable and objective standards. The balance of allowance for writing off estimated
impairments or losses is called the write-off expense for bad debts. For trade-related receivables in commercial
transaction, the write-off expense for bad debts should be accrued into the cost of selling and administrative
expenses, while the write-off expense for bad debts related to other bonds should be accrued into non-operating
expenses.
e) Financial Instruments
The company classifies time deposits for the purpose of short-term capital operations, time deposits, and
periodical deposits of financial institutions with a maturity date less than one year as short-term financial
instruments. Financial instruments, which do not belong to current assets, are classified as long-term financial
instruments.
f)

Inventories

The companys inventories are determined on the basis of the perpetual inventory method and regular
inventory inspection. The inventory value is calculated by the total average method and is recorded as a
purchase cost. The market value of inventory is recorded in the financial statements by inventory classification.
When the market value of the inventory is lower than the purchase cost, the valuation loss of the inventories is
included into the costs of goods sold and at the same time it is recorded in the inventory balance account.
However, when there is no devaluation in the inventory value and the market value is higher than the book
value but lower than the purchase costs, the valuation loss is reversed and deducted from the costs of goods
sold.
g) Marketable Securities
The values of marketable securities are estimated by applying the moving average cost method. According to
the acquisition purpose and intention of holding, the company is classifying the investment for security and
debit securities into held-for-trading, available-for-sale, and held-to-maturity. Among the securities, shares that
can exercise a significant influence in securities are classified as investment stock under the equity method.
Held-for-trading securitiesare classified as short-term investment assets and available-for-sale, and held-tomaturity are classified as long-term investment assets; however, from the end of the reporting period, if a
security matures within one year or it is almost certain that the securities will be disposed, the company
classifies them as short-term investment assets.
Held-to-maturity investments are valued at acquisition cost after depreciation.Held-for-trading securities and
available-for-sale securities financial assets are measured at fair value. However, for available-for-sale financial
assets, when the fair value of stocks cannot be precisely measured, it is evaluated using the acquisition costs.
Gains and losses related to held-for-trading securities are recognized in gains or losses for the period. Gains and
losses related to available-for-sale securities are recognized by Accumulated Other Comprehensive Gain or Loss,
and when available-for-sale securities are sold or when the impairment losses are recognized, the company
reflects these changes in the gains and losses for the period.

46

( "")
,
.
,
. .
,
,
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.

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,

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.
(

.

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,
,
.

47

If the recoverable amount of securities is less than the acquisition costs (considering depreciation) of securities
or acquisition costs of equity, the company considers recognizing the gain or loss for the period. At the end of
the accountingreport, the company evaluates whether there is objective proof that the lost occurred or not.
With objective proof to prove when the loss occurs and there is no other proof to affirm the loss is uncertain,
should be recognized in gain or loss for the period.
When the recovery of impairment losses is objectively related to the events after the impairment loss
recognition, and held for maturity or available-for-sale securities at the fair value recognize the recovery value
as a gain or loss for the period. However, after the recovery, if the amount in the financial statement does not
recognize the impairment loss, the amount of recovery must not exceed the acquisition cost after depreciation
(for available-for-sale, acquisition price) on the current date of recovery. For the available-for-sale securities
that are evaluated at fair value, the previously recognized impairment loss amount should be the limit and the
recovery amount is recognized in the gains or losses for the period.
h) Derivative Goods
The company calculatesassets and liabilities by evaluating the rights and responsibilities that have arisen for
the contract of derivative goods. The gains and losses due to the contract are recognized immediately at the
time of occurrence as the gains or losses for the period.
i) Tangible Assets
The acquisition cost of tangible assets is composed of buying expenses or manufacturing expenses, and is
directly related to the expenses for activating the tangible asset in the necessary place with the necessary
conditions according to the method that executive members intend. After the expiration of the economic usage
of the tangible asset, when the expenses of eliminating the asset or the estimated cost of recovering the asset
fulfill the liabilities recognition criteria, the present value of these expenses are included as the acquisition cost.
The companys tangible assets are measured by the acquisition cost (or the re-evaluated price-residual value)
minus the assets accumulated depreciation and impairment loss, calculated based on the expected useful
life and the depreciation method in the following chart

Division
Convenience goods

Useful Life
Five years

Depreciation Method
Straight-line method

If an expenditure on tangible assets at acquisition or after installation can increase future economic benefits,
such as productivity increases, the extension of useful life, and significant cost savings, it is treated as a capital
expenditure. Otherwise, it is treated as an expense of the period.

48


.
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.

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,

.
,
.
49

j) Intangible Assets
The acquisition cost of the companys intangible assets is composed of the purchaing cost and any directly
related expenses that were used for preparing the intangible asset. The company indicates the acquistion cost by
subtracting the accumulated depreciation and accumulated impairment loss on the basis of the expected useful
life and depreciation method in the following chart:
Classification
Right for trademark

Depreciation
Straight-linemethod

Expected Useful Life


Five years

k) Impairment of Non-Financial Assets


Non-financial assets that are not ready for use are reviewed via an impairment test at the end of every
reporting period. The company undertakes the impairment test on goodwill acquired due to the business
combination by assessing the recoverable amount. In the case of depreciated or amortized assets, the
impairment test is undertaken when there is any indication that the carrying amount may not be recoverable
due to the changes in circumstances or events. However, the impairment test is undertaken for the tangible
asset when it has been determined that there are the signs of damage, and when the future net cash flows is
expected due to the use or disposal of the relevant year of the tangible asset (individual assets or tangible
assets including cash-generating units) is lower than the book value. An impairment loss is recognized when the
book value exceeds the recoverable amount. The highest number between fair value and value in use is chosen
to be the recoverable amount. For the purpose of estimating the impairment, assets are grouped into the lowest
level group (cash generating unit) that can create identifiable individual cash flow.
The goodwill that is acquired for the purpose of the impairment test will be distributed on the acquisition date
at the cash generating unit that the synergy effect of business combination is expected. When the recoverable
amount of the cash generating unit is lower than the book value, the company first decreases the book value of
the distributed goodwill at the cash generating unit, and then the other assets that belong to the cash
generating unit are proportionally allocated to the book value.
Non-financial assets, except the goodwill that recognizes the impairment loss, are examined with the possibility
of reversal, and impaired goodwill cannot be recovered in the future.
I) Employee Wage
(1) Pension Plan
The company has a defined benefit retirement pension plan. The company selects the currently employed staff
and receives pension plans, and any liabilities related to retired employees are calculated as pension plan
liabilities and accrued pension plans. Pension planassets arepresented by subtracting from total liabilities for the
period and, if thepension plan assetsexceed this number, the excess amount is presented as an investmentasset.

50

(2)

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.
(2)
("")
,

. ,
.

.
,
.
.

.

.


. ,
.
51

(2) Annual Allowance Liability


The company recognizes the costs and expenses related to annual paid vacation during the accounting period
of working service that generates the right to annual future paid vacation.
m) Convertible Bonds and Bonds with Warrants
The company separates the liability and equity parts in the accounting treatment of convertible corporate
bonds and bonds with warrants. The liabilities are recognized at the fair value of ordinary corporate bonds
without conversion rights or warrants, and the fair value is measured by the present value of the expected
future cash flows. The value of conversion rights or warrants is derived by deducting the value of bonds in the
liabilities part from the total value of corporate bonds, and is recorded into capital surplus. The liabilities part
is discounted by the effective interest rate method, whereas the equity part will not be measured after initial
recognition.
In addition, the company amortizes (reversal) discounts (premiums) on bonds by applying an effective interest
rate, and the same amortized (reversal) amount is added (or subtracted) on the interest expenses.
n) Conversion of Foreign Currencies
(1) Functional Currency and Term Currency
The company is estimating the items on the financial statements by applying the currency (functional
currency) in the primary economic environment where the operating activities happen. The companys
functional currecy is Korean Won and the financial statement is expressed in Korean Won.
(2) Currency Exchange and Currency Translation
The company has recorded using the spot exchange rate between the foreign currency and the functional
currency of the trading days in the case of recognizing the deals made in other currencies(foreign currency) as
a functional currency. Also, monetary foreign currency assets and liabilities are calculated by the current
exchange rate of the end of reporting report, and any gains or losses from the exchange translation are
included in the gains or losses from the period. However, the same amount is recognized for the risk hedging
costs and foreign currency denominated available-for-sale debt securities as other comprehensive income in the
case of meeting the requirements for cash flow hedging. Non-monetary financial assets and liabilities arising
from exchange differences are reported as part of the fair value gain or loss. At fair value through profit or loss
exchange differences arising from equity to profit or loss is seen as part of the fair value gain or loss, and
foreign currency differences on available-for-sale equity instruments are recognized and included in other
comprehensive income for changes in fair value.

o) Net Income Taxes and Deferred Income Taxes


According to Corporate Tax Law, the currenttax expenses arecalculated as corporate tax expense minus
changes in deferred income taxes. In the case that the income tax effect for taxable temporary differences
increases taxable income in the future periods, the whole amounts are recognized as deferred income taxes
liabilities. The tax effect of such temporary differences and losses to be deducted to reduce taxable income of
future periods is recognized as a deferred tax assets, and if it is expected to be a tax saving for the future it is
probable that the future taxable income is very high. Also, the tax burdens of capital account items that are
directly related to the deferred income tax are deducted and adjusted directly to shareholders' equity.

52

.


.
,

. , ,
,
.
.

,
( ,
). ,

.
()
, (
) . ,
, (
)
.
, ( )


.
,

,
,

.

, ,
.
.
53

p) Estimated Liabilities and Contingent Liabilities


As the company performs the present obligations because of past events or transactions, when it is probable
that recources will flow out and when the loss can be reliably measured, the loss is included into liabilities.
Additionally, contingent liabilities are recorded when the company recognizes potential obligations according to
past events or uncertain future events. If present obligations exist because of past events or transactions,
contigent liabilities are also recorded if it is not probable for resources to flow out, or when the amount of the
obligations cannot be reliably measured.
Estimated liabilities are measured at the present value of the expected expenditures that are required to fulfill
the obligation, and the discount rate that is used for present value assessment is the pre-tax interest rate that
reflects the assessment of the current market for the time value of money and the specific risks of the liability.
Additionally, the residuals of estimated liabilities are reviewed at the end of every reporting period; they are
adjusted by reflecting the current best estimates. The discount rates that are used for present value assessment
are used in the original report, assuming that they have remained unchanged.
F) Measurement of Financial Assets and Financial Liabilities
The First Estimates
The company uses fair value to estimate the financial assets and fianacial liabilities, and the fair value is
normally the trading price or transaction value (it is the fair value of consideration for providing financial assets
in the case of financial assets and it is fair value of consideration of receiving financial liabilities in the case of
financial liabilities). However, the bonds and debts are measured at fair value in these cases: long-term
deferred trading conditions, long-term cash loan if this transaction or the significant difference between the
nominal amount and the fair value of bond debt arising from a similar deal.
If non-financial assets are included in the counter-performance paid (received), then the fair value of this nonfinancial asset is measured by its market price. If there is no market price, deduce the fair value using the
evaluation method (including present value evaluation method). However, even though the counter-performance
paid or received includes non-financial assets, if the relationship between the allocation and use of the fund used
for collecting or paying benefits in return (the restriction of product supply value) is certain, or is dealing with
the leasing deposit, we adopt the total transaction price as the initial confirmed amount of the financial
asset.Short-term trading securities, derivatives (except in a situation suitable for risk-aversion accounting), and
other financial assets or financial liabilities are not measured as fair value after initial confirmation, and the
changes in the fair value are counted as current gainsor losses. The entry value is calculated as initially
measured fair value additions or deductions of the transaction cost that directly relate to the acquisition of
financial assets or the distribution of financial liabilities.
The current value of the financial product measured by the corporation is suitable for the transactionimplied
interest rate of this year. When the transaction implied interest rate is unavailable or is different thanthe same
market rate, it is measured usingthe same market rate. When the same market rate is unavailable, the weighted
average interest rate, calculated according to an objective and reasonable criteria, is a suitable measurement.
When there is no objective and reasonable criteria for productive weighted average interest rate, it is based on
the corporation bonds current yield rate. The rate should reflect the corporations reasonable deducing credit
rating and suit capital allocation costs.
Subsequent measurement
Except for the securities, derivatives, designed projects of the profits and loss affirmed in current period, and
financial guarantee contracts, financial assets and financial debts are suitable for the effective method to
measure the after-depreciation cost. The subsequent determination of the designed projects of the profits and
losses affirmed in the current period should use the same method as held-for-trading.

54

2).
(:).

(%)
2012.12.31

6.0

6.5~8.5

50

50

51,011,559

32,609,293

51,011,609

32,609,343

( 14 ).
3).
.
(:).
()

(%)
()

16,086,118

9.21

108,701

0.77

()
() 2

2,000,000

9.9

(*)

185,936,861

483,083,099

483,083,099

297,146,238

1,935,559

1,847,917

1,847,917

(67,934)

10,000,000

10,000,000

197,852,712

486,931,016

486,931,016

297,078,304

10,000,000

() () , ()
2 .
()

(%)

(*)

()

10,475,717

8.99

34,925,794

380,268,527

380,268,527

345,342,734

() 2

2,000,000

9.90

10,000,000

92,460

92,460

9,907,540

44,925,794

380,360,987

380,360,987

345,342,734

9,907,540

55

2). Short-term investment assets


The content of current investment assets at the end of the reporting period is as follows:

2012.12.31
Annual interest rate (%)

Division
Government bond
Short-term loan

(Unit: KRW 000)

Amount
End of current period

End of last period

6.0

50

50

6.5~8.5

51,011,559

32,609,293

51,011,609

32,609,343

Total

The short-term loans mentioned above include loans to the groups related parties. (Note 14)
3). Available-for-sale securities
a. The content of available-for-sale securities

The content of available-for-sale securities asof the end of the reporting period is as follows: (Unit: KRW 000)
(Current period)

The name of
the company
Celltrion

Owners
Shareholding hip
stake
16,086,118

Celltrion Pharm
Tomato Bank

Purchase
cost

9.21 185,936,861

Net asset
value (*)

Total
Accumulated
unrealized impairment
loss
losses

Book
value

483,083,099 483,083,099 297,146,238

108,701

0.77

1,935,559

1,847,917

1,847,917

2,000,000

9.9

10,000,000

Total

197,852,712

(67,934)

- 10,000,000

486,931,016 486,931,016 297,078,304 10,000,000

Celltrion and Celltrion Pharm used the closing price at the end of the reporting date. The company judeged
thatnet asset value of Tomato bank available-for-saleis unlikely to be recoverable, thus the loss is recognized in
asset impairment losses.

(Last period)

The name of
the company
Celltrion
Tomato Bank

Owners
hip
rate
Shareholding
(%)
10,475,717
2,000,000
Total

Purchase
cost

Net assets
value (*)

Book value

Total
Accumulated
unrealized impairment
loss
losses

8.99 34,925,794 380,268,527 380,268,527 345,342,734


9.90 10,000,000

92,460

92,460

9,907,540

44,925,794 380,360,987 380,360,987 345,342,734

9,907,540

56

.
(:).
()

345,342,733

(160,302,534)

112,106,038

297,146,237

(67,934)

(67,934)

345,342,733

(160,302,534)

112,038,104

297,078,303

(83,572,941)

(38,793,213)

(27,114,716)

(71,894,444)

261,769,792

(121,509,321)

84,923,388

225,183,859

()

322,295,214

(6,284,488)

29,332,008

345,342,734

(70,904,947)

1,382,587

(14,050,582)

(83,572,942)

251,390,267

(4,901,901)

15,281,426

261,769,792

.

( 16 ).
4).
(:).
()

1,203

1,257

/
5,153

5,099

8,564

()

413

410

/
1,200

1,203

7,307

57

b. The content of the changes in the evaluation of available-for-sale securities


The changes of the companys evaluation of available-for-sale securities at the end of this period are as follows:
(Unit: KRW 000)
(Current period)
The beginning of
the period

Division

Increase/
decrease

Liquidation

The end of the


period

Income from the


evaluation of available-forsale securities

345,342,733

(160,302,534)

112,106,038

297,146,237

Evaluation of available-forsale losses

(67,934)

(67,934)

345,342,733

(160,302,534)

112,038,104

297,078,303

(83,572,941)

(38,793,213)

(27,114,716)

(71,894,444)

261,769,792

(121,509,321)

84,923,388

225,183,859

Total
The influence of income
tax
Total differences
(Last period)

The beginning of
the period

Division
Income from the
evaluation of available-forsale securities
The influence of income
tax

Increase/
decrease

Liquidation

The end of the


period

322,295,214

(6,284,488)

29,332,008

345,342,734

(70,904,947)

1,382,587

(14,050,582)

(83,572,942)

251,390,267

(4,901,901)

15,281,426

261,769,792

Total differences

c. Available-for-sale securities that provide security


Some of the available-for-sale securities that the company held have been mortgaged in Woori Bank etc. asof
the end of this reporting period. (Notes 16)
4). Tangible assets
The changes in the book value of companys tangible assets in the current period and last period are as follows:
(Unit: KRW 000)
(Current period)
Division

Convenience
goods

Book value at
the beginning
of the period
1,203

Depreciation

Book value at
the beginning
of the period

Depreciation Purchase
/disposition

1,257

Purchase/
disposition

Book value
Total depreciation
asof the end of cost as of the end of
the period
the period
5,153
5,099
8,564

(Last period)
Division

Convenience
goods

413

410

1,200

Book value
Total depreciation
asof the end of cost as of the end of
the period
the period
1,203

7,307

58

5).
(:).

1,202

1,202

1,202

9,000

1,202

9,000

1,202

1,202

1,143

1,350

(916)

(916)

59

7,650

286

286

(228)

(1,350)

243

243

6).
.
(:).

2012.12.31

6.24

8,500,000

8,500,000

IBK

6.90

11,000,000

11,000,000

7.50

7,000,000

7,000,000

6.30

3,000,000

3,000,000

5.46

40,000,000

7.00

30,000,000

7.00

13,160,000

2,435,000

5,400,000

112,660,000

37,335,000

7,524,000

7,524,000

7,524,000

7,524,000

(%)

6.44

59

5Intangible assets
The changes in the companys intangible assets in the current period and last period are as follows: (Unit:
KRW 000)
Current period
Division

Right for trademark

Purchase cost at the beginning of


the period

Last period

Software

Right for
trademark

Subtotal

1,202

1,202

1,202

Purchase cost/capital expenses

9,000

Purchase cost at the end of the


period

1,202

9,000

1,202

1,202

Accumulated depreciation cost at


the end of the period

1,143

1,350

(916)

(916)

59

7,650

286

286

(228)

(1,350
)

243

243

Book value at the end of the


period
Depreciation cost of intangible
assets
6).Loans
a. Long-term and short-term loans

The long-term and short-term loans until the end of the reporting period are as follows: (Unit: KRW 000)

Division

Short-term loan

Interest rate(%)

Hana Bank

6.24

8,500,000

8,500,000

IBK investment
security

6.90

11,000,000

11,000,000

Shinhan Capital

7.50

7,000,000

7,000,000

Samsung security

6.30

3,000,000

3,000,000

Korea Securities
Finance Corporation

5.46

40,000,000

Rainbow Plus

7.00

30,000,000

In and Out Ltd

7.00

13,160,000

Hana Daetoo Securities


Co., Ltd

2,435,000

5,400,000

112,660,000

37,335,000

7,524,000

7,524,000

7,524,000

7,524,000

Individuals
Total
Long-termdebt

Amount

2012.12.31

Source of loans

Woori Bank
Total

6.44

Current period

Last period

60

.
(1)
(
:).


(1~3 )
(1 )

(%)
2012.12.31
11.00~17.00

12,000,000

17,000,000

5,000,000

12,000,000

22,000,000

(631,825)

(1,866,211)

10,486,647

17,221,788

(228,209)

(4,641,481)

(850,659)

21,626,212

31,863,437

1 1 .
(2)
- 2
: 7,000
: 2009 2 27
: 2013 2 26
:
: 17%
: 3 1
3 .
17%
.
: 1
: 37,600
2 2015 2 26 ,
11% .

61

b. Convertible bonds and bonds with warrants


(1) The convertible bonds and bonds with warrants at the end of the reporting period.
Convertible bondsand bonds with warrants at the end of the reporting period are as follows: (Unit: KRW 000)

Division
Convertible bonds (The 1st-3rd
insurance)
Corporate bonds with warrants
(The 1st insurance)

Amount

2012.12.31
Interest rate (%)
11.00~17.00
-

Total
Corporate bond discounts
Premium of the bond repayment
Adjustment of conversion
Adjustment of warrants
The total amount of bookvalue

Last period

Current period
12,000,000

17,000,000

5,000,000

12,000,000

22,000,000

(631,825)

(1,866,211)

10,486,647

17,221,788

(228,209)

(4,641,481)

(850,659)

21,626,212

31,863,437

(*) The company has repaid the first round of convertible bondsand bonds with warrants during the current
period.
(2) Conditions of the convertible bonds and bonds with warrants
-The second issuance of convertible bonds
Book value: KRW 7,000 MN
Issue date: 2009.2.27
Maturity date: 2013.2.26
Method of repayment: One-time paymenton the date of maturity.
Repayment of company bonds: From the issue date to date of maturity; the interest rate is 17%.
Repayment of options: Bondholders can exercise their right to sell bonds to the company or the third party
designated by the company starting the third month after the issuedate until the end of the period. In this case,
from the issue date to the transfer date, the annual compound interest rate is 17%. Earnings are added to cash
and paid to bondholders.
Conversion period: From one year after the issue to the day before the due day.
Conversion price: KRW 37,600
The maturity day of the second issuance of convertible bonds was extended to February 26, 2015 from the first
maturity date to the transfer date, the annual compound interest rate has been changed to 11%

62

- 3
: 5,000
: 2009 4 2
: 2013 4 1
:
: 17%
: 3 1
3 .
17%

.
: 1
: 37,600
7).
()
,
.
( )

2010.01.05

140,000

762,477

()

(226,512) 14 12

63

-The third issue of convertible bonds


Book value: KRW 5,000 MN
Issue date: 2009.4.2
Maturity date: 2013.4.1
Method of repayment: One-time payment on the date of maturity.
Repayment of companys bonds: Calculated using the annual compound interest rate of 17%, from the issuing
date to the date of maturity.
Repayment of options: Bondholders can exercise the right to sell the bonds to the company or the third party
designated by the company from the third month after the issuedate until the end of the period. In this case,
from the issue date to the transfer date, the annual compound interest rate is 17%. Earnings are added to cash
and paid to bondholders.
Conversion period: From one year after the issue to the day before thedue day.
Conversion price: KRW 37,600
7). Derivatives trading
The group has signed a contract that gives buyers income compensation or bonus shares when Woori Bank
transfers Celltrions stock. Profit and loss for the current period and previous period are as follows:
(Last period)

Signing date

Remarks
Counterparty
Target shares Trading profits Gains (losses)
Counterparty
Target Shares TargetTrading
Shares Counterparty
Profit
Target
Trading
Shares
Gains
Profit
(Losses)
Target
Trading
Gains
Shares
(Losses)
Profit
Trading
Gains
Remarks

2010.01.05

Individual

140,000

762,477

(226,512)

120,000 out of 140,000


shares were sold

The previous period and the beginning of the current period have been fully carried out. The gain and loss in
the last period has also been completed. Therefore, there are no gainsor losses oncommodity derivative
trading.

64

8).
(
:).

USD

61,182

65,532

3,676

4,240

EUR

52

77

65,532

4,317

USD

81

87

59,831

69,004

EUR

13,719

19,430

163,949

244,956

GBP

5,500

9,521

5,500

9,776

CHF

35,254

41,357

35,254

43,217

EUR

2,700

3,824

USD

17,238

18,464

92,683

366,953

65

8). Foreign currency assets and foreign exchange liabilities


Until the end of reporting period, changes of in the companys foreign currency assets and liabilities are as follows:
(Unit: KRW 000)
This period
Accounts

Cash and cash equivalent

Currency

Foreign currency
amount

Accrued payables
Total liabilities

Foreign currency
amount

KRW

KRW

USD

61,182

65,532

3,676

4,240

EUR

52

77

Total assets

Accounts payable

Last period

65,532

4,317

USD

81

87

59,831

69,004

EUR

13,719

19,430

163,949

244,956

GBP

5,500

9,521

5,500

9,776

CHF

35,254

41,357

35,254

43,217

EUR

2,700

3,824

USD

17,238

18,464

92,683

366,953

66

9).
( : ).

23,875

68,419

23,875

(10,908)

81,386

23,875

(149,567)

(102,284)

(68,181)

(78,409)


(: ).

23,875

61,362

23,875

7,850

3,999

81,386

23,875

81,386

23,875

67

9) Retirement pension liabilities


Changes in retirement pension liabilities during the current period and the last period are as follows: (Unit: KRW
000)
Division

Current period

Last period

Initial balance

23,875

Increase

68,419

23,875

(10,908)

81,386

23,875

(149,567)

(102,284)

(68,181)

(78,409)

Payments
Final amount
Pension
Pension payables

Changes in retirement pension liabilities during the last period of pension provisions and operating assets are as
follows (Unit: KRW 000)
Current period

Last period

Foundation

23,875

Reserve

61,362

23,875

Payments

7,850

Interest income

3,999

81,386

23,875

81,386

23,875

End of period
Configuration details
Fixed deposit

68

10).
.
4,000,000 (1
:5,000 ) ( : 1%, 15%)
20% . 2012 12 31
1,732,380 .
.
.
.
(233 , 1,165 )
, .
.
.

13

=====================
2012 01
12
01

2012 12
31
2013 3 29

2011 01 01
2011 12 31

2012 3 30

( : )

()

97,666,420

(3,791,691)

()

(3,791,691)

2,555,503

()

101,458,111

(6,347,194)

64,490

64,490

97,601,930

(3,791,691)

()

69

10). Capital
a) The number of authorized shares and the number of the issue of ordinary shares
According the company bylaws, the sum of stocksit can issue is 4,000,000 shares at KRW 5,000 per share. Up
to 20% of this can be issued in non-voting preferred shares in registered form (preferred shares rate: 1%-15%).
Outstanding common shares were 1,732,380 shares as the end of the period.
b) Premium of the decrease in capital
Premium on the reduction of capital cannot be used for other purposes except to cover a deficit orconvert to
capital.
c) Common share
To dispose of shares related to the non-paid capital increase (223 shares, KRW 1.2 MN), the group planed to
include the acquisition cost of self-owned shares in the adjustment of equity.
d) Statement of retained earnings
Profits of the company's current and historical surplus appropriation statement are as follows:
Statement of Retained Earnings
====================
The 12th period
The 13th period
2012.1.12012.12.312011.1.12011.12.31
Expected date of disposal 2013.3.29
Date of disposal 2013.3.30
Celltrion GSC

(Unit: KRW 000)


Division

Current quarter

Last quarter

Undistributed loss

97,666,420

(3,791,691)

Unappropriated retained earnings carried over from prior


period(outstanding loss)

(3,791,691)

2,555,503

Net income (loss)

101,458,111

(6,347,194)

Retained earnings

64,490

Discount on stock issuance

64,490

97,601,930

(3,791,691)

Unappropriated retained earnings carried over from prior


period(outstanding loss)

70

11).
.
(: ).

31,951,970

1,848,913

(10,701,875)

10,065,044

11,678,497

(12,667,995)

32,928,592

(754,038)

()

.
( :).

134,386,703

(7,101,232)

32,059,582

(1,744,898)

869,010

990,860

(:3,995 ,
:2,324 )

(/
)

878,793

562,455

(9,783)

428,405
32,928,592

(754,038)

24.5%

71

11) Income tax expenses


a) Detail of income tax expenses
The details of the income tax expenses in the current period and last period are as follows: (Unit: KRW 000)
Detail

Current period

Income tax

Last period

31,951,970

1,848,913

(10,701,875)

10,065,044

Deferred income tax reflected on the capital

11,678,497

(12,667,995)

Income tax expenses

32,928,592

(754,038)

The change of deferred income tax liabilities due to


temporary difference

b) The relationship between net profit or loss before income tax and income tax expenses
The relationship between net profit or loss before income tax and income tax expenses is as follows: (Unit: KRW
000)
Category

Current period

Net profit or loss before income tax


Income tax according to applicable tax
rate
Adjustment
Non-tax exemption expenses (current
period: KRW 3,995 MN, last period: KRW
2,324MN)
Difference in other tax rate
Income tax expenses
Effective tax rate (income tax
expenses/net profit or loss before income
tax)

Last period

134,386,703

(7,101,232)

32,059,582

(1,744,898)

869,010

990,860

878,793

562,455

(9,783)

428,405
32,928,592

(754,038)

24.5%

72

. ()
() (
:).
()

()

()

()

-
-

333,293

333,293

541,777

541,777

119,191

13,860,937

3,374,290

10,486,647

2,307,062

3,360,850

3,360,850

226,512

226,512

9,907,540

92,460

10,000,000

2,200,000

168

168

4,662

4,662

1,026

17,907

1,882

49,084

65,109

14,324

8,292,951

3,499,278

4,793,673

1,054,608

67,934

67,934

14,946

36,000,158

10,796,273

755,917

25,959,802

4,627,279

1,083,878

(1,565,875)

(934,050)

(631,825)

(139,002)

(300,336)

(300,336)

(4,641,481)

(4,413,272)

(228,209)

(50,206)

(850,659)

(850,659)

(160,302,535) (112,106,039) (297,146,238)

(71,909,390)

()
-
-

()-

(345,342,734)
(8,749)

(8,749)

(3,188)

(3,188)

(701)

(17,907)

(47,202)

(65,109)

(14,324)

(787,578)

(787,578)

(173,267)

(166,809,601) (114,065,759) (299,983,899)

(363,176)

(71,923,714)

4,264,103

(70,839,836)

(352,727,741)

73

c) The increase or decrease of temporary differences and deferred income tax assets (liabilities)
The increase or decrease of temporary differences and deferred income tax assets (liabilities) betweenthe current
and previous period is as follows: (Unit: KRW 000)
(Current period)
Temporary differences

Category

Balance at
the
beginning of
the period

Decrease

Liquid
deferred
income tax
assets
(liabilities)

Balance at
the end of
the period

Increase

Non-current
deferred
income tax
assets
(liabilities)

Deductible temporary
differences
Provision for bad debt

333,293

333,293

541,777

541,777

119,191

Premium of repayment
Convertible bonds

13,860,937

3,374,290

10,486,647

2,307,062

Premium of repayment
Corporate bonds with
warrants

3,360,850

3,360,850

226,512

226,512

9,907,540

92,460 10,000,000

2,200,000

168

168

4,662

4,662

1,026

Retirement benefit liabilities

17,907

1,882

49,084

65,109

14,324

Available-for-sale securities

8,292,951

3,499,278

4,793,673

1,054,608

67,934

67,934

14,946

36,000,158

10,796,273

755,917 25,959,802

4,627,279

1,083,878

(1,565,875)

(934,050)

(631,825)

(139,002)

(300,336)

(300,336)

(4,641,481) (4,413,272)

(228,209)

(50,206)

Subscription right
(850,659)
(850,659)
Profit or loss of evaluation of
(345,342,734 (160,302,535 (112,106,039 (297,146,238
derivative commodity
)
)
)
)

Evaluation loss of derivative


commodity
Impairment loss of availablefor-sale securities
Loss of foreign exchange
translation

Loss of available-for-sale
securities
Total
(Taxable temporary
differences)
Issue discount Convertible
bonds
Issue discount Bonds with
stock option
Adjustment of conversion
options

Gains on foreign exchange


conversion
Pension contributions
Accrued income
Total

(8,749)

(8,749)

(17,90
-

(3,188)

(3,188)

(701)

(47,202)

(14,324)

(787,578)

(65,109)
(787,57

(173,267)

(352,727,741 (166,809,601 (114,065,759 (299,983,899


)
)
)
)

Deferred income tax assets (liabilities) Net amount

- (71,909,390)

(363,176) (71,923,714)
4,264,103 (70,839,836)
74

()

()

()

()

153,364

153,364

333,293

333,293

73,324

14,856,083

995,146

13,860,937

3,049,406

4,369,436

1,008,586

3,360,850

739,387

226,512

226,512

49,833

9,907,540

9,907,540

2,179,659

4,149

4,149

168

168

37

29,450

29,450

4,490,012

4,490,012

-
-

17,907

17,907

3,939

8,457,872

164,921

8,292,951

1,824,449

32,360,366

6,845,628

10,485,420

36,000,158

6,091,646

1,828,388

(2,783,677)

(1,217,802)

(1,565,875)

(344,492)

(575,533)

(275,197)

(300,336)

(66,074)

(9,044,705)

(4,403,224)

(4,641,481)

(1,021,126)

()
-
-

()-

(2,552,182)

(1,701,523)

(850,659)

(187,145)

(322,295,214)

(89,042,652)

(112,090,172)

(345,342,734)

(83,572,941)

(1,377,589)

(1,377,589)

(8,749)

(8,749)

(1,925)

(17,907)

(17,907)

(3,939)

(338,628,900)

(98,017,987)

(112,116,828)

(352,727,741)

(1,620,762)

(83,576,880)

4,470,884

(81,748,492)

75

(Last period)
Temporary differences
Category

Balance at the
beginning of Decrease
the period

Increase

Liquid
deferred
Balance at income tax
assets
the end of
the period (liabilities)

Noncurrentdeferr
ed income
tax assets
(liabilities)

(Deductible temporary)
Provision for bad debt
Premium of repayment
Convertible bonds
Premium of repayment
Corporatebonds with
warrants
Loss on derivatives
Impairment loss on availablefor-sale securities
Loss of foreign exchange
conversion
Accrued expenses
Option payables
Retirement pension liabilities
Available-for-sale securities

153,364

153,364

333,293

333,293

73,324

14,856,083

995,146

13,860,937

3,049,406

4,369,436 1,008,586

3,360,850

739,387

226,512

226,512

49,833

9,907,540

9,907,540

2,179,659

4,149

4,149

168

168

37

29,450

29,4

4,490,012

4,490,

164,

17,907

17,907

3,939

8,292,951

1,824,449

8,457,872

Total

32,360,366 6,845,628

10,485,420

36,000,158

6,091,646

1,828,388

(Taxable temporary
differences)
Issue discount Convertible
bonds
Issue discount Bonds with
warrants

(2,783,677) (1,217,802)

(1,565,875)

(344,492)

(575,533) (275,197)

(300,336)

(66,074)

Adjustment of conversion
option

(9,044,705) (4,403,224)

(4,641,481) (1,021,126)

Adjustment of subscription
rights

(2,552,182) (1,701,523)

The profit or loss of


evaluation of available-forsale securities
The profit or loss of
evaluation ofderivative
commodity

(322,295,214)

(850,659)

(89,042,65 (112,090,172 (345,342,734


2)
)
)

(187,145)

- (83,572,941)

(1,377,589)

(1,377,5
89)

Gains from conversion of


foreign currency

(8,749)

(8,749)

(1,925)

Pension contributions

(17,907)

(17,907)

(3,939)

Total

(338,628,900)

(98,017,98 (112,116,828 (352,727,741


(1,620,762) (83,576,880)
7)
)
)

Deferred income tax assets (liabilities) Net amount

4,470,884 (81,748,492)

76

.
(:
).

297,146,238

(71,909,390)

225,236,848

345,342,734

(83,572,942)

261,769,792

67,934

(14,945)

52,989

. (: )

677,563

1,964,268

(31,951,970)

(1,848,913)

()

(31,274,407)

115,355

12).
(:).

()

101,458,111,

(6,347,194)

(36,585,933)

10,379,525

(36,585,933)

10,379,525

64,872,178

4,032,331

( :
:
11,678,497 :

77

d) Explanation of addition or deduction of deferred tax assets in equity


Details of addition or deduction of deferred tax assets in equity at the end of the accounting period are as follows
(Unit: KRW 000)

Current period
Category

The amount
before tax

Profit or loss of
evaluation of
available-for-sale
securities

The amount
Influence of
after income
income tax
tax

297,146,238 (71,909,390)

Loss on available-forsale securities

Previous period

67,934

(14,945)

The amount
Influence of The amount
before income income tax
after income

225,236,848

345,342,734 (83,572,942)

52,989

261,769,792

e) Income tax assets and income tax liabilities before offsetting in this period (Unit: KRW 000)

Accounting

This period

Income tax assets before deduction

Previous period
677,563

1,964,268

Income tax liabilities before deduction

(31,951,970)

(1,848,913)

Net income tax assets (liabilities) after


deduction

(31,274,407)

115,355

12).Statement of comprehensive income


Details of the comprehensive income during the current and previous period are as follows: (Unit: KRW 000)
Division

Current period

Previous period

Net income (loss)

101,458,111

(6,347,194)

Other comprehensive income

(36,585,933)

10,379,525

(36,585,933)

10,379,525

64,872,178

4,032,331

Available-for-sale securities
valuation gains (Tax effect:
Current period: 11,678,497
Previous period:12,667,995)
Net comprehensive income

78

13).
. ( : , ).


()

101,458,111,184

(6,347,194,424)

1,732,147

1,732,147

58,574

(3,664)

(*1)

(*1)
, .
.

.

(: , )


()

101,458,111,184

(6,347,194,424)

1,732,147

1,732,147

319,148

598,853

139,852

319,148

459,000

2,051,295

2,331,000

49,461

(2,723)

79

13). Earnings per share


a. Basic earnings per share are as follows: (Unit: KRW, share)
Division
Net income per common share (loss)

Current period

Previous period

101,458,111,184

(6,347,194,424)

1,732,147

1,732,147

58,574

(3,664)

Weighted average number of common


shares
Basic earnings per share

(*1) The weighted average number of common shares deducted from company-owned shares in the stock
issuance. The number of common shares during the current period stays the same as that of the previous
period.
b. Diluted earnings per share
Diluted earnings per share are estimated under the assumption that all dilutive potential common stcoks are
converted into common shares adjusted and applied to the weighted average number of ordinary shares. The
dilutive potential common stocks that company holds include preemptive rights and convertible bonds. The
number of shares is calculated under the assumptions that preemptive rights are excercised and convertible
bonds are converted into stocks. (Unit: KRW, share)
Division
Net income per common share (loss)
Weighted average number of common
shares outstanding
Adjustment details
Corporate bonds with warrants
Convertible bonds
Weighted average number of shares
outstanding for diluted earnings per
share calculation
Diluted earnings per share

Current period

Previous period

101,458,111,184

(6,347,194,424)

1,732,147

1,732,147

319,148

598,853

139,852

319,148

459,000

2,051,295

2,331,000

49,461

(2,723)

80

14) :
.

()

()

()
()
()
()

()
()
()
()

. (:)
()


2,337,165

16,529,392

2,935,595

18,866,557

2,935,595

()


690,620

30,587,795

2,052,681

31,278,415

2,052,681

81

14. Transactions with Related Parties


a) Related parties
Division
General manager

Other related parties

Current period

Previous period

Seo Jung-Jin

Seo Jung-Jin

Celltrion Holdings

Celltrion Holdings

Celltrion Healthcare

Celltrion Healthcare

Celltrion

Celltrion

Celltrion Pharm

Celltrion Pharm

Celltrion Chemical Laboratory

Celltrion Chemical Laboratory

Celltrion Don (in Russia)


Shareholders and
employees

Celltrion Don (in Russia)


Shareholders and
employees

b) Main transaction between related parties (Unit: KRW 000)


(Current period)
Division

Sold

General manager
Other related parties
Total

Purchased
2,337,165

16,529,392

2,935,595

18,866,557

2,935,595

(Last period)
Division
General manager
Other related parties
Total

Sold

Purchased
690,620

30,587,795

2,052,681

31,278,415

2,052,681

82

. (:)
()

33,904,151

339,042

21,249,591

212,480

12,165,759

55,153,742

551,552

12,165,759

()

25,436,986

254,370

9,185,134

91,852

13,967,318

34,622,120

346,222

13,967,318

. (:)
()

(%)

(*1)

6.9~8.5

30,963,000

6.9~8.5

19,848,559

17%

12,747,800

(*1) () 17,443
.
()

(%)

(*1)

8.50%

24,833,000

8.50%

7,736,293

17.00%

10,382,301

(*1) () 13,990
.

83

c) The contents of the main receivables and payables resulting from the main transactions between related
parties (Unit: KRW 000)
(Current period)
Credit
Company

Amount

Debt

Provision for bad debt

Amount

General manager

33,904,151

339,042

Other related parties

21,249,591

212,480

12,165,759

55,153,742

551,552

12,165,759

Total
(Last period)

Credit
Company
General manager
Other related parties
Total

Amount

Debt

Provision for bad debt

Amount

25,436,986

254,370

9,185,134

91,852

13,967,318

34,622,120

346,222

13,967,318

d) Credits and debts on financial arrangements with related parties


(Current period)

Credit
Debt

Division

Transaction parties

Short-term
investment
assets

General manager (*1)

6.9~8.5

30,963,000

Other related parties

6.9~8.5

19,848,559

Other related parties

17%

12,747,800

Convertible bonds

Profit rate(%)

Amount

(*1) Celltrion provided 17,443 shares as a guarantee for the long-term loan mentioned above.
(Last period)
Division
Credit
Debt

Short-term
investment
assets
Convertible bonds

Transaction parties

Profit rate(%)

Amount

General manager (*1)

8.50%

24,833,000

Other related parties

8.50%

7,736,293

Other related parties

17.00%

10,382,301

(*1) Celltrion provided 13,990 shares as a guarantee for the long-term loan mentioned above.

84

. (:)

(*1)

()

7,524,000 3,645,583

()

(*1)

7,000,000 () 690,000

21,626,612

8,500,000

- USD 3,000,000

. (:)

()

() 3,827,319 (*1)

()

() 690,000 (*2)

34,991,000
7,000,000

(*1) ()
42,515,000 ( 16 ).
(*2) ()
14,000,000 ( 16 ).
15)
(:).

(48,264,430)

23,047,520

(11,678,497)

12,667,995

85

e) Related parties have provided collateral, and guarantee details are as follows. (Unit: KRW 000)
Loan source

Warranty source

Guarantee details

Amount

Details
3,645,583 shares of Celltrion

Provide

stocks

General manager, other guarantee, joint


Woori Bank (*1) related parties
guarantee

Shinhan Capital
(*1)

7,524,000 60,000 shares of Celltrion


healthcare stocks

Provide
General manager, other guarantee, joint
related parties
guarantee

7,000,000 690,000 shares of Celltrion stocks

Convertible bond General manager

Joint guarantee

21,626,612

Hana bank
National
Agricultural
Cooperative
Federation

General manager

Joint guarantee

8,500,000

General manager

Joint guarantee

- Limitation USD 3,000,000

(*) Loan guarantee as a common obligation is provided by CelltrionHoldings Note 16


f) Guarantees to related parties and mortgage details (Unit: KRW 000)
Borrower
Celltrion Holdings

Warranty details
(*1)3,827,319 shares of Celltrion
stocks

Loan source
Woori Bank

Amount

Note

34,991,000 Loan guarantee

(*2)690,000 shares of Celltrion


Shinhan
7,000,000 Loan guarantee
stocks
Capital
(*1) Company and Celltrion Holdings have borrowed KRW 42,515,000 from Woori Bank, with a joint
guarantee obligation. (Note 16)
(*2) Company and Celltrion Holdings have borrowed KRW 42,515,000 from Shin-Han Capital, with a joint
guarantee obligation. (Note 16)
Celltrion Holdings

15) Cash flow statement


Significant non-cash transactions for the current and previous period are as follows: (Unit: KRW 000)
Division

Current period

Previous period

Valuation gains of available-for-sale securities

(48,264,430)

23,047,520

Reversal of deferred tax liabilities in valuation of available-forsale securities

(11,678,497)

12,667,995

86

16)
.
. (:)

()

3,077,319

(*1)

750,000

690,000

(*1,3)

7,524,000
-


()

(*2,3)

7,000,000

IBK

11,000,000

IBK

8,500,000

3,000,000

40,000,000

740,000

620,000

286,192

2,200,000
200,000

2,360,000

USD 3,000,000

30,000,000

13,160,000

1,000,000

.
( 14 ).
(*1) 42,515,000
.
(*2)
14,000,000 .
(*3)
.
15
.
.

USD 3,000,000

USANCE L/C

() 200,000 ,
( 14 ).

87

16) Contingent liabilities and commitments


As of the end of the current period, collateral and guarantees of the group company are as follows:
a) Guarantees and collaterals of company assets(Unit: KRW 000)
Account

Collaterals
3,077,319

Loan provider
Woori Bank(*1)

750,000 Woori Bank(*1,3)

Available-for-sale
financial assets

690,000

Shinhan Capital
Co.,LTD(*2,3)

740,000

IBK Investment
&Securities Co.,Ltd

620,000

Hana Bank

Debt balance

Details

7,524,000Loan guarantee from Woori Bank


-

Guarantee provided by Celltrion


Holdings

7,000,000Loan guarantee from Shinhan Capital


11,000,000

Loan guarantee from IBK Investment


&Securities Co.,Ltd

8,500,000Loan guarantee from Hana Bank

Samsung securities
Co.,Ltd
Korea Securities
2,200,000
Finance
National
Agricultural
200,000
Cooperative
Federation

Loan guarantee from Samsung


Securities
Korean securities finance loans as
40,000,000
collateral

2,360,000

30,000,000Loan guarantee

286,192

Rainbow Plus

1,000,000 Inand Out Co.,Ltd

3,000,000

The amount of guarantee is under the


limitation of 3,000,000

13,160,000Loan guarantee

Except for the company providing the above guarantee and related parties providing or receiving from the
associated party, the company has no other collateral. (Note 14)
(*1) The group and Celltrion Holdings have borrowed KRW 42,515,000 from Woori Bank, with a joint
guarantee obligation.
(*2) The group and Celltrion Holdings have borrowed KRW 14,000,000 from Shin-Han Capital, with a joint
guarantee obligation.
(*3) The groups shareholders have a responsibility ofjoint and several guarantee for the loans from Woori
Bank and Shin-Han Capital.
The company has no other collateral or guarantee except the items written on note 15 which is the lists of
collateral and guarantees that company provides or received from the special party.
c) Commitmentswith financial institutions
Contractor
National Agricultural
Cooperative
Federation

Limitation agreed
USD 3,000,000

Amount exercised

Agreement details
-

USANCE L/C

(*) According to the above agreement, the group is using 200,000 shares of Celltrion stock as collateral and a
credit guarantee is provided by related parties. (Note 14)

88

17)
.(:).

12,004,100

25,818,905

798,174

11,205,926

26,617,079

798,174

18)
.(:).

600,946

701,638

68,419

23,875

58,095

24,426

(582)

7,462

106,123

173,934

34,084

21,419

1,257

410

1,578

243

49,544

8,276

38,753

16,763

181,999

69,407

159,632

40,738

12,571

13,461

1,312,419

1,102,052

89

17Cost of goods sold


The cost of goods sold during the current and previous period is as follows: (Unit: KRW 000)
Division

Current period

Cost of goods sold (COGS)

Previous period
12,004,100

25,818,905

Beginning inventory

798,174

Purchase this period

11,205,926

26,617,079

798,174

Ending inventory
18) Sellingand administrative expenses (SG&A)

The sellingand administrative expenses of the current and previous period are as follows: (Unit: KRW 000)
Division
Salaries

Current Period

Previous Period
600,946

701,638

Retirement salaries

68,419

23,875

Welfare expenses

58,095

24,426

(582)

7,462

106,123

173,934

34,084

21,419

Depreciation expenses

1,257

410

Moralization of intangible assets

1,578

243

Travel and transportation expenses

49,544

8,276

Vehicle maintenance expenses

38,753

16,763

Commissions

181,999

69,407

Rent payment

159,632

40,738

12,571

13,461

1,312,419

1,102,052

Bad debt expenses


Delivery cost
Entertainment expenses

Selling and administration expenses

90

19)
(:).

600,946

574,745

701,638

68,419

23,875

58,095

24,426

1,257

410

1,578

243

612

1,643

159,632

40,738

1,465,283

792,973

20)
.
2012 3 08
.
.
2013 2 4 720,000 ( 80%)
13,200 2013 3 3 .

91

19) Accounts needed for calculating added value


Accounts needed for calculating added value for the current and previous period of are as follows: (Unit: KR
W 000)
Account

Current Period
Selling and administration
expenses

Salaries

Previous Period
Cost of sales

Selling and administrative


expenses

600,946

574,745

701,638

Retirement salaries

68,419

23,875

Welfare expenses

58,095

24,426

Depreciation expenses

1,257

410

Moralization of
intangible assets

1,578

243

Tax and addition

612

1,643

159,632

40,738

Rental cost
Total

1,465,283

792,973

20) Report termination date


AThe day financial statements are approved
The company's financial statements have been approved by the board of directors. It will present them at the
shareholder meeting on 14March2012.
b) Acquisition ofshares in other corporation
On 4February2013, the companysigned a contract to spend \13,200 millionwonto obtain 720,000 shares of
Hanskins common shares (80% ownership stake). The acquisition was finalized on 3March 2013.

92

3.
.
(1)
( : , %)

13

1,276

12

0.94%

51,012

510

0.99%

3,166

31

0.97%

55,454

553

0.96%

1,334

13

0.97%

32,609

326

0.99%

720

0.97%

34,663

346

0.99%

12

(2) 3
( : )

1.

13

347

12

248

11

290

2. ()

()

3. ()

206

99

4.

553

347

42
248

(3)
-
.

93

3. Matters concerning accounting information


a) Status of allowance for bad debt
(1) The allowance for bad debt in the recent fiscal year by account

Classification

Account

th

13 period

1,276

12

0.94%

Short-term loans

51,012

510

0.99%

Accrued income

3,166

31

0.97%

Total

55,454

553

0.96%

Accounts receivable

1,334

13

0.97%

32,609

326

0.99%

720

0.97%

34,663

346

0.99%

Short-term loans
th

12 period

Allowance for bad debt Loan loss reserve ratio

Total liabilities

Accounts receivable

(Unit: KRW MN, %)

Accrued income
Total

(2) Status of change in allowance for bad debt in the past three fiscal years
(Unit: KRW MN)
Classification
1. Beginning balance of allowance for
bad debt

13th period

12th period

11th period

347

248

290

2. Net bad debt expense()

Bad debt expense(book value of


bad debts)

Recovery amount of bad debt

Other changes

3.Allowance for bad debt(reversal)

206

99

4. Total ending balance of allowance


for bad debt

553

347

42
248

(3) Policy on the setting the allowance for bad debt related to accounts receivable
For the accounts receivable balance, the allowance for bad debt is set using the bad debt rate based on
historical data and the expected rate of bad debt.

94

(4)
( : )

6
1

1
3

13

13

1,262

1,262

1,275

1,275

100

100

.
(1)
( : , %)

336

AIR FILLER

267

API

134

61

798

798

0%

0.185%

30.1

69.7

(%)
[100]
()
[ {()2}]

13

12

(2)
-
, .
()
,
. ,

,
.
-

.

95

(4) Status of the balance of accounts receivable by age at the end of the period
(Unit: KRW MN)
Division
General
Amount

Related party
Total

Proportion

6 months to 1
year

<6 months

1-3 years

>3 years

Total

13

13

1,262

1,262

1,275

1,275

100

100

b) The holding and physical inspection history of inventory


(1)Status of inventory holding by business sector in the recent fiscal year
(Unit: KRW MN, %)
Business sectors

Account

13th period

12th period

Remarks

Biosimilars

Finished product

336

Air filler

Finished product

267

API

Finished product

134

Machinery

Finished product

61

Others

Finished product

798

798

0%

0.185%

30.1

69.7

Total
The ratio of inventory to total assets (%) [inventory total
assets at the endof the period 100]

Inventory turnover (times)[annual cost of goods sold


{(beginning inventory + ending inventory) 2}]

(2) The physical inspection history of inventory and the like


- The quantity of inventories at the end of the period is determined on the basis of the perpetual inventory
system and regular physical inspections. The value of inventory is measured by the total weighted average
method and is estimated as purchase cost. When the market value of inventory is lower than the purchase cost,
the difference (net realizable value) is included on the balance sheet by inventory classification while the loss
on valuation of inventories is included on the balance account of inventories and added to cost of goods sold.
However, in asituationwhere inventories that are devaluated disappear and the new market value is higher
than the book value(but do not exceed the initial carrying amount), losses from cost of goods sold are reversed
and marked.
- Other matters
The inventory difference between the inspection date and the balance sheet date is recognized by the
companys good delivery certificates and good reception certificates.

96

. 5

2008

. 5
( : )

12

(6,347)

() 2

(4,324)

launchig

.

. 5 30%

( : )

13

11

101,458

1~2 1
6,830

2006
,

10

7,315 2008 8

97

c) Change in accounting standards in the last five business years and reasons
Financial year
2008

Accounting change

Reason for change

The investment evaluated by the equity method in The significant influence was forfeited and
the last period was reclassified as available-for-sale therefore reclassified as available-for-sale
securities
securities

d) Losses in the lastfive business years and reasons


Business years
The 12th
period

The 9th
period

Loss in this period

(6,347)

(4,324)

(Unit: KRW MN)


The reason

As of the closing date of this report, Tomato Bank believed it


was difficult for the invested enterprise to recover net assets,
so the impairment loss is recognized during the current period.
The launch of new productsis continuing. Due to the change in
the investment fund, financial cost was recognized as a loss in
the current period.

e) In the lastfive business years, net profits rose 30%, turning positive. Below are the reasons for the shift in net
profits.
(Unit: KRW MN)
Business years
The 13thperiod

th

The 11 period

The 10thperiod

Loss in this period

The reason

With the transactions of call and put options, net profits increased
101,458 due to the disposal of investments in backdoor listings in August
2008.
Net profits increased due to profit from the acquisition of stock
options, including the first and second convertible bonds and the first
6,830
cooperate bonds with warrants.
In 2006, the transactions of call and put options, through which
Woori Bank and Celltrion sell stocks, were recognized as short-term
7,315 liabilities.The net profits increased due to the disposal of investments
in backdoor listings in August 2008.

98

4.

13

2012. 12. 31

12

2011. 12. 31

( : )
13

12 ()

103,594,997,365

51,407,776,236

(1)

103,594,997,365

50,609,602,339

1.( 8)

30,136,372,971

8,735,970,950

2.( 2,14)

51,011,608,701

32,609,343,364

(510,115,587)

(326,092,934)

3.( 14)

1,275,626,218

1,333,776,270

(12,756,263)

(13,337,763)

3,166,132,184

719,968,873

(31,661,321)

(7,199,689)

5.

9,569,439,572

6.

4,726,248,190

2,970,934,014

7. ( 11)

115,355,272

8. ( 11)

4,264,102,700

4,470,883,982

4.( 14)

(2)

1.

798,173,897
798,173,897

485,012,004,781

380,440,887,128

(1)

484,999,196,978

380,439,397,058

1. ( 3,16)
2. ( 9)

484,931,016,100

380,360,987,587

68,180,878

78,409,471

(2)( 4)

5,099,134

1,203,334

(3)( 5)

7,708,669

286,736

588,607,002,146

431,848,663,364

185,787,797,761

82,992,980,938

.
1.( 8)

154,719,116

1,758,224,734

112,660,000,000

37,335,000,000

7,848,823,625

275,206,791

4.

287,536,114

360,065,878

5.

545,571,348

20,604,408

6.

247,776,174

471,079,901

3,618,352,536

3,385,362,371

8.( 11)

31,274,406,995

9.( 6 14)

12,000,000,000

17,000,000,000

2.( 6 16)
3.( 8 14)

7.( 14)

99

4. Financial statement
a) Fiancial performance

The 13th period: 2012.12.31


The 12th period: 2011.12.31

Celltrion GSC AG
Accounting

(Unit: KRW)
th

The 12th period

The 13 period

Asset
.Working capital

103,594,997,365

51,407,776,236

(1) Current assets

103,594,997,365

50,609,602,339

1.Cash and cash


equivalents(Note8)

30,136,372,971

8,735,970,950

2. Short-term investment (Note2,


14)

51,011,608,701

32,609,343,364

Provision for bad debt

(510,115,587)

(326,092,934)

3.Accounts receivable (Note14)

1,275,626,218

1,333,776,270

Bad debt provision for accounts


receivable

(12,756,263)

(13,337,763)

3,166,132,184

719,968,873

(31,661,321)

(7,199,689)

5.Other receivable

9,569,439,572

6.Prepayment

4,726,248,190

2,970,934,014

115,355,272

4,264,102,700

4,470,883,982

4.Accrued income (Note14)


Allowance for doubtful accounts

7. Deferred tax asset (Note11)


8. Deferred income tax assets
(Note11)
(2)Inventories
1.Instrument

798,173,897
798,173,897

.Non-current assets

485,012,004,781

380,440,887,128

(1) Investments assets

484,999,196,978

380,439,397,058

1. Available-for-sale securities
(Note 3,16)
2. Pension (Note 9)

484,931,016,100

380,360,987,587

68,180,878

78,409,471

(2) Tangible assets (Note4)

5,099,134

1,203,334

(3) Intangible assets (Note 5)

7,708,669

286,736

588,607,002,146

431,848,663,364

185,787,797,761

82,992,980,938

Total assets
Liabilities
.Current liabilities
1.Current liabilities (Note 8)

154,719,116

1,758,224,734

2.Short-term borrowings (Note 6,


112,660,000,000
16)

37,335,000,000

3.Accounts payable (Note8, 14)

7,848,823,625

275,206,791

4.Accrued expenses

287,536,114

360,065,878

5.Advanced payments

545,571,348

20,604,408

6.Tax withholdings
7.Advance payment (Note14)

247,776,174

471,079,901

3,618,352,536

3,385,362,371

8.Current tax liabilities (Note11)

31,274,406,995

9.Convertible corporate bonds


(Note 6, 14)

12,000,000,000

17,000,000,000
100

(631,825,360)

(1,565,874,986)

10,486,646,520

13,860,937,199

(228,209,307)

(4,641,480,893)

10.( 6)

5,000,000,000

(300,335,585)

3,360,850,392

(850,659,272)

7,524,000,000

7,524,000,000

11.( 6,16)
.

70,839,835,872

1.( 9)

2.( 11)

81,748,492,374

81,386,109

23,875,480

(81,386,109)

(23,875,480)

70,839,835,872

81,748,492,374

256,627,633,633

164,741,473,312

8,661,900,000

8,661,900,000

.
1.( 10)

8,661,900,000

8,661,900,000
597,333,772

1.( 10)

597,333,772

597,333,772
597,333,772

(130,144,180)

(130,144,180)

1.

(128,979,180)

(128,979,180)

2.( 10)

(1,165,000)

(1,165,000)

225,183,859,461

1.( 3,11,12)

225,236,848,362

2.( 3,11,12)

(52,988,901)

V. ()( 11)
1.()

261,769,792,184
261,769,792,184

97,666,419,460
97,666,419,460

(3,791,691,724)
(3,791,691,724)

331,979,368,513

267,107,190,052

558,607,002,146

431,848,663,364

101

Discount on insurance of
corporate bond
Reimbursement expense

(631,825,360)

(1,565,874,986)

10,486,646,520

13,860,937,199

(228,209,307)

(4,641,480,893)

10.Corporate bonds with warrant


(Note6)

5,000,000,000

Discount on insurance of
corporate bond

(300,335,585)

Repayment premiums

3,360,850,392

Adjustment of warrants

(850,659,272)

7,524,000,000

7,524,000,000

Adjustment of conversion

11. Long-term current liability


(Note 6,16)
.Non-current liabilities
1. Retirement allowance liabilities
(Note 9)
Pension
2.Deferred tax liabilities (Note11)

70,839,835,872

81,748,492,374

81,386,109

23,875,480

(81,386,109)

(23,875,480)

70,839,835,872

81,748,492,374

Total liabilities

256,627,633,633

164,741,473,312

8,661,900,000

8,661,900,000

Equity
.Capital
1.Common stock (Note10)

8,661,900,000

.Capital surplus
1. Reduction of capital premium
(Note10)

597,333,772
597,333,772

.Capital adjustment
1.Stock issue discount
2. Treasuryshares (Note10)
.Other comprehensive
gain/loss
1.The gains of evaluation of
available-for-sale securities
(Note3,11,12)
2.Loss on valuation of availablefor-sale securities (Note3, 11, 12)

597,333,772
597,333,772

(130,144,180)

(130,144,180)

(128,979,180)

(128,979,180)

(1,165,000)

(1,165,000)
225,183,859,461

225,236,848,362

261,769,792,184
261,769,792,184

(52,988,901)

V. Retained earnings (Note 11)


1.Unappropriated earned
surplus(unappropriated retained
earnings)

8,661,900,000

97,666,419,460
97,666,419,460

(3,791,691,724)
(3,791,691,724)

Total equity

331,979,368,513

Total liabilities and equity

558,607,002,146

267,107,190,052
431,848,663,364

102

13 2012 1 1 2012 12
31 12 2011 1 1 2011
12 31

( : )
13 ()

.( 14)

12 ()

15,481,246,329

27,824,376,329

1.

14,040,297,274

27,824,376,329

2.

1,440,949,055

.
1.( 14, 17)
2.
.

12,578,844,097

25,818,905,015

12,004,099,587

25,818,905,015

574,744,510

2,902,402,232

2,005,471,314

103

b) Income statement
The13thperiod: 2012.1.1-2012.12.31
The12thperiod: 2011.1.1-2011.12.31
Celltrion GSC AG
Accounting
.Sales (Note 14)
1. Sales of products
2.Sales of service

(Unit: KRW)
The 13th period
15,481,246,329

2.Service cost of sales


.Gross profit

27,824,376,329

14,040,297,274

27,824,376,329

1,440,949,055

.Gross profit
1.Costs of goods sold
(Note14, 17)

The 12th period

12,578,844,097

25,818,905,015

12,004,099,587

25,818,905,015

574,744,510

2,902,402,232

2,005,471,314

104

.(
14,18,19)
.
.

1,312,419,396

1,102,051,643

1,589,982,836

903,419,671

144,199,752,770

11,129,773,751

1.( 14)

3,963,772,899

2,899,655,527

2.

1,047,571,700

800,303,475

14,920,998

82,549,962

3,187,934

8,749,315

138,959,003,796

6,295,403,556

762,477,395

10,120,381

280,593,079

201,175,062

41,442

3.
4.
5.
6.( 7)
8.
9.
.
1.( 14)

11,403,032,378

19,134,425,513

10,797,333,010

8,599,786,747

182,652,354

212,789,229

4,662,450

168,122

208,484,285

91,019,514

226,512,120

6.

92,460,487

9,907,539,513

7.

1,624,405

115,192,586

96,261,800

622,801

348,468

2.
3.
4..
5.( 7)

8.
9.
10.
.()

134,386,703,228

(7,101,232,091)

.()( 11)

32,928,592,044

(754,037,667)

.()( 12)

101,458,111,184

(6,347,194,424)

1.

58,574

(3,664)

2.

49,461

(2,723)

XI.( 13)

105

.Sales and administrative


expenses (Note 14,18,19)

1,312,419,396

1,102,051,643

.Operating profit

1,589,982,836

903,419,671

144,199,752,770

11,129,773,751

.Non-operating income
1.Interest income (Note
14)

3,963,772,899

2,899,655,527

2.Dividend income

1,047,571,700

800,303,475

14,920,998

82,549,962

3,187,934

8,749,315

138,959,003,796

6,295,403,556

762,477,395

10,120,381

280,593,079

201,175,062

41,442

3.Currency arbitrage
4.Earnings from
translationof foreign
currency
5.Gains from disposal of
available-for-sale securities
6.Gains from transaction of
derivative commodity(Note
7)
8.Fee income
9.Miscellaneous profit
.Non-operating profit
1.Interest expense (Note
14)
2.Losses from foreign
exchange trading

11,403,032,378

19,134,425,513

10,797,333,010

8,599,786,747

182,652,354

212,789,229

4,662,450

168,122

208,484,285

91,019,514

226,512,120

92,460,487

9,907,539,513

7. Loss on disposition of
available-for-sale

1,624,405

8.Loss on redemption of
debentures

115,192,586

96,261,800

622,801

348,468

3.Losses from translation


of foreign currency
4.Other bad debt
5.Loss of evaluation of
derivative commodity(Note
7)
6.Loss and impairment of
available-for-sale financial
assets

9.Commission
10.Miscellaneous losses
.Profit before income tax

134,386,703,228

(7,101,232,091)

32,928,592,044

(754,037,667)

101,458,111,184

(6,347,194,424)

1.Basic earnings per share

58,574

(3,664)

2.Gain or loss per diluted


share

49,461

(2,723)

.Taxexpense(Note11)
. Net profit for the year
(Note 12)
XI.Earnings per share
(Note 13)

106

IV.
1. ()
.
13

12

11

. ( )
-
.

13

12

11

10

13

12

21 '' 21.5 2

.
,
36,937 , 36,937
.
20,982 .
, 24,815

11

10

13,126 . ,
8,699 ,
29,899
-

107

IV. Auditors Opinions

1. Audit opinions of auditors (certified public accountants), etc.


a) Auditors
The 13th period

The 12th period

Samyoung Accounting Corporation


Independent Audit Report

The 11th period

Samyoung Accounting Corporation


Independent Audit Report

Samyoung Accounting Corporation


Independent Audit Report

b) Notes on the annual audit (or review) process of the current accounting year.
No related issue
c)

Audit opinions
Fiscal year

Audit opinions

Summary of opinions

The 13th period

No opinion

No deficiencies

th

The 12 period

No opinion

No deficiencies

The 11th period

No opinion

No deficiencies

th

No opinion

No deficiencies

The 10 period
d)

Summary of special matters

Fiscal year

The 13th period

The 12th period

Special matters
Under Korean GAAP, amendment was made on the chapter 21.5-2ofEmployee
Benefits. Due to the amendment, the company recognizes the expenses and liabilities
related to annual paid leaves for the employees works that gives a right for future
annual paid leave during the accunting period. Upon the amendments becoming
effective, companys current net assets at the end of current accounting perod were
reduced by KRW 36,937 and net profit at the current accounting period was reducedby
KRW 36,937.
In this accounting period, revenue from related parties reached KRW 20,982 MN. As of
the end of this accounting period, credits and debts of related parties were KRW 24,815
MN and KRW 13,126 MN, respectively.

The 11th period

The 10th period

In the previous accounting period, revenue from related parties was KRW 8,699 MN. As
of the end of the previous accounting period, credits and debts of related parties were
KRW 29,899 MN and KRW 1,261 MN respectively
-

108

1. ()
( )

2. 3
.
( : )

13

32

384

12

30

344

11

29

320

3. .
( )
4.
( )

109

1.The annual audit (internal) opinions of the current accounting year


(None)
2. Remuneration of external auditors in the recent three accounting years and relevant matters
a) Contract status of audit service
(Units: KRW MN)
Fiscal year

Auditor

Contents

Remuneration

Total time

The 13th period

Samyoung
Accounting
Corporation

External audit contract that complies with


Act on External Audit of Stock Companies

32

384 hours

The 12th period

Samyoung
Accounting
Corporation

External audit contract that complies with


Act on External Audit of Stock Companies

30

344 hours

The 11th period

Samyoung
Accounting
Corporation

External audit contract that complies with


Act on External Audit of Stock Companies

29

320 hours

3. Non-audit contract with external auditors


(No relatedissue)
4. Other(No related issue)

110

V.
1.
,
.
2.
(1) ,

2012

2011

( : , %)

15,481

27,824

12,343

55.64

12,578

25,819

13,241

48.72

2,902

2,005

897

144.74

1,312

1,102

210

119.06

1,590

903

686

175.97

144,200

11,130

133,069

1,295.59

11,403

19,134

134,387

-7,101

141,487

1,792.49

101,458

-6,347

141,003

2,021.56

7,731

59.60

(2)

(: )

13

12

588,607

431,849

159,063

136.83

256,628

164,741

94,747

157.51

331,979

267,107

64,317

124.08

588,607

431,849

159,063

136.83

111

V. Operational Diagnosis and Analytic Opinions of the Chief


Executive Officer
1. Please note that the predicted information contained here is based on expectationson internal markets and
the working conditions of the company, which canchange due tobusiness conditions and the analysis
environment.
2. Business performance

(1) The business performance at the end of the latest accounting year is as follows:
(Unit: KRW MN,%)
Division

2012

Increase/
decrease

2011

Ratio of increase or
decrease

Revenue

15,481

27,824

12,343

55.64

Cost of sales

12,578

25,819

13,241

48.72

Gross profit

2,902

2,005

897

144.74

Selling and administrative


expenses

1,312

1,102

210

119.06

Operating profit

1,590

903

686

175.97

Non-operating income

144,200

11,130

133,069

1,295.59

Non-operating expense

11,403

19,134

7,731

59.60

Profit before income tax

134,387

-7,101

141,487

1,792.49

Net profit for the year

101,458

-6,347

141,003

2,021.56

(2) Financial status


(Unit: KRW MN)
Accounting

The 13th period

The 12th period

Increase/decrease

Ratio of increase or
decrease

Total assets

588,607

431,849

159,063

136.83

Total liabilities

256,628

164,741

94,747

157.51

Total equity

331,979

267,107

64,317

124.08

Total liabilities and equity

588,607

431,849

159,063

136.83

112

3.
2 .
(:)

13

12

(4,781)

2,914

(7,695 )

(164.07)

(32,386)

(8,378)

(24,007)

386.55

58,568

3,000

55,568

1,952.27

. (++)

21,400

(2,464)

23,864

(868.51)

8,736

11,200

(2,465)

77.99

30,136

8,736

21,400

344.96

4.
21 '' 21.5 2

. ,
36,937 ,
36,937 .
5.
" " "
2. " .

113

3. Procurement of liquidity and funding, etc.


The cash flow of the group during the last two accounting years is as follows:
(Unit: KRW MN)
Accounting

The 13th period The 12th period

Increase/
decrease

Ratio of increase
or decrease

. Cash flows from operating activities

(4,781)

2,914

(7,695)

(164.07)

. Cash flows from investing activities

(32,386)

(8,378)

(24,007)

386.55

. Cash flow from financing activities

58,568

3,000

55,568

1,952.27

. Increase in cash (++)

21,400

(2,464)

23,864

(868.51)

. Opening cash balance

8,736

11,200

(2,465)

77.99

. Closing cash balance

30,136

8,736

21,400

344.96

4. Important changes in accounting policy and accounting estimates


Under Korean GAAP, amendment was made on the chapter 21.5-2ofEmployee Benefits. Due to the
amendment, the company recognizes the expenses and liabilities related to annual paid leaves for the
employees works that gives a right for future annual paid leave during the accunting period. Upon the
amendments becoming effective, companys current net assets at the end of current accounting perod were
reduced by KRW 36,937 and net profit at the current accounting period was reducedby KRW 36,937.
5. Other issues concerning investment decision
Please refer to Note 2, important accounting guidelines, in the audit report appendix for important changes
to the accounting policy and accounting valuation.

114

VI.
1.
.
1 , 2

3 .
.
( )
.
()

.

2 1
.
.

- .
.
- .
.
-

,
.

115

VI.Relevant Issues Concerning Company Departments (i.e.


Board of Directors) and Subsidiaries
1. Board of directors
a) General introduction of board of directors
As of the date of finalizing this report, the companys board of directors consisted of three people, including one
permanent director and two nonpermanent directors.
b) Outside directors
(No related issue)
c) Relevant issues concerning the operation of board of directors
(a) Main content
Composition of board of directors
The board of directors is made up entirely of directors. The president is its chairman.
Convening of the board
Board meetings are held atthe request of a representative director or at least two directors. All directors and
supervisors need to be informed one day before the meeting.However, the summons procedure can be omitted
with the consent of the directors and auditors.
Decision process
- Proposals are passed when more than half the board is in attendance and when more than half of the
attendingdirectors approve. Ifthe number of approvals equalsdisapprovals, the final decision is left to the
chairman.
-Directors must attend the meeting personally. Forms of simultaneous audio and video participation are
permitted.
- An attendant withspecial interest in the proposal is not allowed to vote.
Meeting records
Records should contain issues
discussed in the meeting and be
filed after attending directors and
supervisors signand seal them.

116

()

2012.01.02

. (_15 , _15 )

. ()

. (_4 )

. (USANCE)

. 2011 ,

. 70

12

. 2011 , ,

. (()_400 )

. (_1 , _4 , _2 )

. (75 ,1 ) ()

2011

2012.01.27
2012.02.23
2012.03.07
2012.03.28
2012.03.30
2012.05.07
2012.05.14
2012.06.26

2012
2012.07.02

. (_200 , _35 )

. (_242 )

. (() () )

. (_30 , _15 )

. (_63 )

. (_1500 )

. (3,759,398 ) _

. (_70 )

. (_2 )

. (_600 , _600 )

. /

. (_249

2012.10.02


2012.10.18

2012.11.28

()

2012.12.10
2012.12.28
2012.12.31

117

b) Directors meeting details


Year

Date

Content
-The case ofsetting limits on capital loans for

Whether
approved
Yes

special party and the case of approvingloan


2012.01.02

Notes
-Approval of loan limit (Seo Jung-jin_1.5 billion, Celltrion
Holdings_15 billion)

execution
-The case of changingrepayment date and

Yes

interest rate for the residuals of loans at the


end of 2011
-The case of approval for holding shareholders

-Approval of loans (Celltrion Healthcare_KRW0.04 billion)


Yes

meeting
-The case of approving joint and several

-Approval of repayment date and interest rate changes (Celltrion


Holdings)

Yes

-Approval of re-extension for matured opening import letter of


credit (USANCE)

guarantee of matured Celltrion Holdingss


2012.01.27
2012.02.23

borrowings
-The 12th shareholders meeting
-The case of approving of borrowings for

Yes
Yes

operation
2012.03.07
2012
2012.03.28

-The case of loan payments


-The case of re-arrangement for loans

2012.03.30

Yes
Yes

-The case of setting limits on capital loans for Yes

execution
-Approval of extension for matured loan

2012.06.26

exchange market

-Approval of 2011 financial statements, changes in articles of


incorporation, appointment of boards and compensation limits.
-Approval of financial loans (Korea Securities Finance Co., Ltd._ 40
billion)

Yes

-Extension of loans payable to Woori Bank (7.5 billion for 1 year)


and
approval of joint and several gurantee and giving collateral

Yes

-Approval of loan limit (Celltrion Holdings_20 billion, Seo Jungjin_3.5billion)

2012.05.14
-Approval of marketable securities in the stock

-Approval of agreement for joint and several guarantee of Shinhan


Capital 70 billion

-Approval of loans (Seo Jung-jin_0.1 billion, Gojanghwan_0.4


billion, Choenanyoung_0.2 billion)

special party and the case of approving loan


2012.05.07

-Approval of2011 closing report, appointing directors and


supervisors, and changes in articles of incorporation

-The case of setting limits on capital loans for Yes

-Approval of extension for matured loan(Seo Jung-jin_24.2 billion)

special party and the case of approving loan


execution
2012.07.02

-Approval of maturity date extension for loans Yes


-Approval of the sale of marketable securities

Yes

in the stock market


-The case of setting limits on capital loans for
special party and the case of approving loan
2012.10.02

Yes

execution
-Approval of maturity date extension for loans Yes
-Approval of the sale of marketable securities

Yes

-Approval of marketable securities in the stock exchange market


(Celltrion shares and Celltrion Pharmaceutical)
-Loan limit granted (Celltrion Holdings_3 billion, Seo Jung-jin_1.5
billion KRW)
-Approval of matuity dateextension for loan (Seo Jung-jin_6.3
billion)
-Approval of the sale of marketable securities in the stock market
(limit approved_150 billion)
-Approval of sales of Celltrion shares (3,759,398 shares_Buyer:
Orix Corporation)

in the stock market


2012.10.18

-Approval of selling common share of Celltrion Yes

-Approval ofextension for loan payables (Shinhan Capital_7 billion)

2012.11.28

-Approval of extension for borrowings

Yes

-Approval of extension for matured loan

Yes

-Approval of extension for matured loan (Choenanyoung_0.2


billion)

2012.12.10
2012.12.28
2012.12.31

-Approval of limits loan borrowing due to the


comprehensive contract of working capital
-Approval of collateral and terms of condition
changes from the negotiations with the
reflection of the revised commercial law

Yes

-Approval of stock collaterallimitsloans (Rainbow Police Co.,


Ltd_60billion, In and Out Ltd_60 billion)

Yes

-Approval of transactions that reflect the revision of


contract/commercial law.

Yes

-Approval of the agreement for collateral for loans and conditions


modification (Seo Jung-jin_24.9 billion

118

. 2010 , ,


2011.02.25

. 70

()
2011.03.29

2011.03.31
2011.03.31
2011.06.27

2011

. 2010 , , .

11

2011.07.22

2011.09.19

2011.09.22

2011.09.29

2011.09.30

2011.10.03

2011.11.29
2011.12.26

. (75 ,1 )
(),
. ( 7-50 13-3)


2011.10.12

.
. (, 220 )_ 62,000
. (, 12.2 )
.
. (_10 ,
_30 ,
_10

)
. (_30 )
. 70
( 83 )

()
( )
()
( )
()
( )

119

2011.02.25
2011.03.29

-The case of approval for holding


shareholders meeting
-Agreement for joint
and several guarantee

Yes

Yes

-Passed the 2010 closing report, appointed directors and supervisors, and
set relevant payment limits

-Approved Shinhan Capital 7 billion joint and severalguarantee agreement

with respect to the


condition changes for
the loans of Celltrion
Holding

-the 11th general


2011

2011.03.31
2011.03.31
2011.06.27

stakeholders meeting
-Appointment of CEO
-Re-arrangement for

Yes
Yes

Yes

Headquarter
Yes
-Holding extraordinary

2011.09.19

shareholders meeting
-External loan payment

2011.09.22

2011.09.29

-Approval of the2010 financial report, article of incorporation


modification, appointed directors and supervisors, and set payment limits
-Approval of the representative directorappointment
-Approval of theextension of WooriBanks loan(7.5billion, 1 year), joint
& several collateral and collateral provision for Celltrion Holdings,

loans
-Relocation of

2011.07.22

Yes

Yes

related issues

-External loan payment

Yes

related issues

Yes

Celltrion Start-ups Investments


- Relocation of headquarter(InchonYeonsu District, Songdo,750InchonYeonsu District, Songdo,13-3)
-Approval of holdingextraordinary general meeting of stockholders for the
modification of articles of incorporation
-Approval of external loans (Seo Jung-Jin, 22billion), collateral Celltrion
Healthcare 62,000 stocks

-Approval of external loans(Celltrion Healthcare_1.22billion)


-Approval of modification of the articles of association

-Modification of the
articles of association
2011.09.30
-The case of setting limits on capital loans

Yes

for special party and the case of approving

-Loan limit granted and approval of execution (Celltrion Holdings_1billion,


Celltrion Healthcare_3 billion, Seo Jung-jin_1 billion)

loan execution

2011.10.03

-Approval of working
capital borrowing

Yes

-Approval of obtaining working capital loan (Samsung_3 billion)

2011.10.12
-Rearrangement of Loan
2011.11.29

Yes
-Payment of loan

2011.12.26

-Approval of negotiation

Yes

-Loan approval (Seo Jung-jin_8.3 billion)

Yes

-Collateral agreements and mortgage loans changed, conciliation


agreement approved (Seo Jung-jin)

for change of loan


collateral agreement and

-Shinhan Capital7 billion

adjustment of collaterals.

(c) Meeting details of outside directors


(No related issue)
(d) Composition of internal committee
(No related issue)
(e) Internal committee meeting details
(No related issue)

120

2.
.
() () ,
,
1 .
() ()
1) ,
.
2) ,
.
3) .
() ()

2004.1-2004.12()

2005.1-2005.12() IT

. ()

2011

2011.02.25
2011.03.31

3.
.
( )
.
( )
.
( )

121

2. Audit system
a) Relevant issues concerning audit system
(a) Setting theaudit system, its organization, and others
No supervision committee has been settled on as of the date of submitting the annual report. A supervisor has
beenselected to perform supervision duties for thecompanys accounting and business.
(b) The internal mechanism for the committee to acquire operating information needed for supervision
1) The supervisor supervises directorsand hasthe right to ask directors for business reports and to
check on the companys business.
2) The supervisor should pre-check the proposals submitted to the general stockholdermeeting and state
whether there areany procedures or issues violatingregulations.
3) The supervisor should record his/her work and sign and seal it.
(c)Personal information of the committee(supervisor)
Name

Major experience

Hwang Sok-yong

Notes

2004.1-2004.12Representative director of Global Education Cultural Exchange


Co.
2005.1-2005.12Director of Gangbuk Computer Education for the Professional School of IT

b) The activity details of the committee (supervisor)

Year

2011

Date
2011.02.25
2011.03.31

Content
Submit agree-to-convene proposal to the general
stockholder meeting
Appointrepresentative director

Whether
approved
Yes
Yes

Notes
-

3. Relevant details concerning exercising voting rights of shareholders


a) The application of the cumulative voting system
(No related issue)
b) The application of the written or electronic voting system
(No related issue)
c) The exercise of minority stakeholders rights
(No related issue)

122

4.

( :

2012 12 31 )

( : , , %)

()

()

2002

02

50

10,476

8.99

380,269

5,610

-9,292

112,106

16,086

9.21 483,083

1,732,914

174,431

1,916

109

1,916

-68

109

0.77

1,848

331,044

3,552

10,000

2,000

9.90

92

-92

2,000

9.9

12,476

18.89

380,361

5,719

-7,376

111,946

18,195

19.88 484,931

2,063,958

177,983

26
2012

10

22
2010

12

29

* () () ,
() 2

.
** () 1 0.5
.

123

4. Status of subsidiaries
Other investment corporation status
(Base date: 31 December2012)

Name

Funding Funding Funding

(Unit: KRW MN, %)

Beginning balance

2002.

Pharm

Tomato

Valuation

Overweight
(underweight)

Amount Equity
ratio

Amount Monetary
amount

10,476

8.99

380,269

5,610

-9,292

112,106

16,086

10.

investmen 1,916

109

1,916

-68

109

0.77

22

2,000

9.90

92

-92

2,000

9.9

12,476 18.89

380,361

5,719

-7,376

111,946

26
Celltrion

Equity

Book
value

50

02.

2012.

investment

Book
value

9.21 483,083

Current
term of
Total
assets profit and
loss

1,732,914

174,431

1,848

331,044

3,552

18,195 19.88 484,931

2,063,958

177,983

Equity

2010.12
Equity
.29

Bank

Last years
financial status

purpose amount

date

Amount Equity
ratio

Celltrion

Ending
balance

Increase (decrease)

investmen

10,
000

t
Total

Celltrion and CelltrionPharm use the current price as the final price.Tomato Bank 2 has been deemed difficult to
restore the net asset value. Therefore, impairment losses are recognized in the previous period and the current
period.
Celltrion implementsa free capital increase of 0.5 per shareusing ashare premium in the current period.

124

VII.

( :

2012 12 31 )

( : , %)

1,160,327

66.98

1,185,341

68.42

315,774

18.23

276,507

15.96

1,476,101

85.21

1,461,848

84.38


( :

2012 12 31

2012 07 31

( : , %)

1,185,341

68.42


( :

2012 12 31

( : )

5%

1,185,341

68.42

109,703

6.33

( :

2012 12 31

( : )

20

66.66

160,829

9.28

125

VII. Issues Concerning Shareholders


The largest shareholder and related parties of the shareholding status
(Base date: 31 December 2012)

(Unit: Share, %)

Name of shares
Name

Beginning

Type of
stock

Relation

End of period

Equity
ratio

Amount

Notes

Equity
ratio

Amount

Seo Jung-Jin Oneself

Common
stock

1,160,327

66.98

1,185,341

68.42

Individuals

Common
stock

315,774

18.23

276,507

15.96

Common
stock

1,476,101

85.21

1,461,848

84.38

Preferred
stock

Affiliate

Total

Details of the shareholder stockholder change

(Base date: 31 December 2012)

The largest
stockholder

Changing date
2012.07.31

(Unit: Share, %)

Amount of
stockholding

Seo Jung-Jin

Equity ratio

1,185,341

Notes

68.42

Status of shareholding
(Base date: 31 December 2012)
Changing date
Shareholders with
more than a 5%share

(Unit: Share, %)

Name of stockholder

Amount of stockholding Equity ratio

Notes

Seo Jung-Jin

1,185,341

68.42

HongIn-pyo

109,703

6.33

Conference of shareholding employees


Status of minority stockholders
(Base date: 31 December 2012)

(Unit: Share, %)

Stockholder
Category
Minority stockholder

Amount of stockholding

Amount of
stockholding

Equity ratio
20

66.66

Number of shares
160,829

Equity ratio

Notes

9.28

126

VIII.
1.

( :

2012 12 31 )

( : )

- ()
1941

09

2008.3.31~

- ()

2014
03
31

('98~'99)
- ()
1962

11

27,164

2014
03

- ()

31

('00~'03)

1970

04

2015
03

()

31


( :

2012 12 31 )

( : )

20

23

1.00

677

29

18

21

0.94

568

27

38

44

1.94

1,245

56

127

VIII. Executives and Staff


1. Status of executives and staff
Status of executives
(Base date: 31 December 2012)

Date
of
Name
birth

Whether
Positio
registered
n

(Unit: share)

Full
time

Duty

Repres
entativ
Gimtaeg 1941.
u
09

Registered
executive

Full
time

Registered
executive

Full
time

Registered
executive

Part
time

director

Yibyeon 1962
11
gryul

Jeon yil 1970.0


4
bu

All

Amount of
stockholding

Major experience

Common Preferred
stock
stock

Representative,
executivedirector of
DaewooMotor Company
('98~'99)

Director of Neksol
Finance

End of
the
term

Time on
the job

2008.3.3
1~

27,164

2014.03.31

Present

2014.03.31

2015.03.31

IMM Investment
vice present

Status of staff
(Base date: 31 December 2012)

(Unit: KRW MN)

Number of staff
Business
Gender Regular Contracte
sectors
Other
staff
d workers

Total

Average

Total

Average

working

annual

salary per

years

payment

capita

Note

Male

20

23

1.00

677

29

Female

18

21

0.94

568

27

38

44

1.94

1,245

56

Total

128

2.
1.
( : )

2,000

2,000

2.
( : )

12

12


( :

2012 12 31 )

( : , )

( )

129

2. Remuneration of executives
1. Approval amount atshareholdergeneral meeting

(Unit: KRW MN)

Number of
people

Catalog

Approved amount

Note

Director

2,000

Auditor

2,000

2. Payments
(Unit: KRW MN)
Number of
Total payments
people

Catalog

Payment per
capital

Total fair value of


stock options

Note

Executive director

Non-executive directors

Audit committee or
audit

12

12

Total

Status of granting and exercising stock option


(Based day: 31 December 2012)

(Unit: KRW/share)

Number of
Exerci
Quantity changes
Types of
Relations
Exercising
Recipient
Method
unexercise
sing
Date of grant
hip
period
of grant stocks Grant Exercise Cancel
d
price
-

(No related issue)

130

IX.
1. :
.

()
()
()

()
()

()
()

()
()

()

. (:)
()


2,337,165

16,529,392

2,935,595

18,866,557

2,935,595

()


690,620

30,587,795

2,052,681

31,278,415

2,052,681

. (:)
()

33,904,151

339,042

21,249,591

212,480

12,165,759

55,153,742

551,552

12,165,759

131

IX. Transactions with Stakeholders


1. Transactions with related parties
a) Related parties

Division

Current period

General manager

Other related parties

Last period

Seo Jung-Jin

Seo Jung-Jin

Celltrion Holdings
Celltrion Healthcare
Celltrion
Celltrion Pharm
Celltrion Chemical Laboratory
Celltrion
Shareholding executive employees

Celltrion Holdings
Celltrion Healthcare
Celltrion
Celltrion Pharm
Celltrion Chemical Laboratory
Celltrion
Shareholding executive employees

b) Main transactions with related parties. (Unit: KRW 000)


(Current period)
Catalog

Sell

General manager
Other related parties
Total

Purchase
2,337,165

16,529,392

2,935,595

18,866,557

2,935,595

(Last period)
Catalog

Sell

Purchase

General manager
Other related parties
Total

690,620

30,587,795

2,052,681

31,278,415

2,052,681

c) The main receivables and payables resulting from the transactions with related
parties(Unit: KRW 000)
(Current period)

Bond
Company

Amount

Debt

Allowance for bad debt

Amount

General manager

33,904,151

339,042

Other related parties

21,249,591

212,480

12,165,759

55,153,742

551,552

12,165,759

Total

132

()

25,436,986

254,370

9,185,134

91,852

13,967,318

34,622,120

346,222

13,967,318

. (:)
()

(%)

(*1)

6.9~8.5

30,963,000

6.9~8.5

19,848,559

17%

12,747,800

(*1) () 17,443
.
()

(%)

(*1)

8.50%

24,833,000

8.50%

7,736,293

17.00%

10,382,301

(*1) () 13,990
.
. (:)

(*1)

()

7,524,000 3,645,583
()

(*1)

21,626,612

8,500,000

7,000,000 () 690,000

- USD 3,000,000

(*1) ()
( 17 ).

133

(Last period)
Bond
Company

Amount

General manager
Other related parties
Total

Debt

Allowance for bad debt

Amount

25,436,986

254,370

9,185,134

91,852

13,967,318

34,622,120

346,222

13,967,318

d) Credits and debts on financial loan with related parties (Unit: KRW 000)
(Current period)

Catalog

Interest
rate(%)

Holder

Amount

General manager(*1)

6.9~8.5

30,963,000

Bond

Short-term
investment asset

Other related parties

6.9~8.5

19,848,559

Debt

Convertible bonds

Other related parties

17%

12,747,800

(*1) Celltrion Healthcare provided 17,443 shares toguarantee the short-term investment mentioned above.
(Last period)

Catalog

Bond

Holder

Short-term
investment asset

Debt

Convertible
bonds

Interest rate(%)

Amount

General manager(*1)

8.50%

24,833,000

Other related parties

8.50%

7,736,293

Other related parties

17.00%

10,382,301

(*1) Celltrion Healthcare provided 13,990 shares to guarantee the short-term investment mentioned above.
e) Related parties provide collateral and guarantee details(Unit: KRW 000 )
Guarantee
Source of loans
Collateral source
Amount
Details
details
3,645,583 shares of Celltrion

Provide
Woori Bank(*1)

General manager, other


related parties

guarantee,
joint
guarantee
Provide

stock
7,524,000 60,000 shares of Celltrion
Healthcare stock

Shinhan
Capital(*1)
Convertible
bonds

General manager, other


related parties
General manager

Joint
guarantee

21,626,612

Hana Bank

General manager

Joint
guarantee

8,500,000

National
Agricultural
Cooperative

General manager

Joint
guarantee

guarantee

7,000,000 690,000 shares of Celltrion stock

- Limitation USD 3,000,000

(*1) Refers to CelltrionHoldings incidental obligation to repay the amount of the joint and several guarantee loan.

134

. (:)

()

() 3,827,319 (*1)

()

() 690,000 (*2)

34,991,000
7,000,000

(*1) ()
42,515,000 ( 17 ).
(*2) ()
14,000,000 ( 17 ).

135

f)

Related parties provide collateral and guarantee details(Unit: KRW 000)


Borrowers

Collateral details

Source of
loans

Celltrion Holdings

3,827,319 shares of Celltrion stock

Woori Bank

Celltrion Holdings

690,000 shares of Celltrion stock

Shinhan
Capital

Amount

Note

34,991,000 Loan guarantee


7,000,000 Loan guarantee

(*1)CelltrionHoldingshas joint guarantee obligations with Woori Bankfortotal joint and severalguarantee
loanworthKRW 42,515 MN. (Referring to Note 17)
(*2) CelltrionHoldings hasjoint guarantee obligations with Shinhan Capital fortotal joint and severalguarantee
loanworthKRW14,000 MN. (Note 17)

136

X.

( : 2012.12.31)

( : )

()

()


( )

( )

, 2
() ( 197 )

( )
( :

2012 12 31

( : )


( )
( :

2012 12 31

( : )

137

X.Necessary Measures to Protect Other Investors


Status of bills and checks for mortgage or collateral
(Base date:31 December 2012)
Issued party

(Unit: KRW)
Purchase

Amount

Note

Banks

Financial institutions (bank


exclusive)

Corporation

Other (individual)

Status of short-selling, non-exchange


(No related issue)
Relationship
between margin
acquirer and
company

Notified
Notified
price of
occurrence
Unrecover Whether Claim and
time of
short-termRedempti
action Period of Whether public
ed
request
short-term
exclusion
disclosure
on
Gain from
trading
trading
Current
plan
returns
amount amount
acquisitio
margin
date
margin
n
-

Total

Shareholders of the group(including sovereign entitiesotherthan equity securities or a securities depository)


may require that thegroupprovide arefund onwhich to obtain short-term spreads.Ifthe group does not claim the
bill within two months, the shareholder may request a subrogation (Capital Market Law Enforcement Order
197).
Details about publicfunds raised
(No related issue)
(Base date:31 December 2012)

Catalog
-

Payment date
-

(Unit: KRW)

Actual received
amount

Funds usage plan


declared

Actual funding
usage

Reason of
difference

Details about privatefunds raised


(No related issue)
(Base date:31 December 2012)

Catalog
-

Payment date
-

(Unit: KRW)

Actual received
amount
-

Funds usage plan


-

Actual funding
usage
-

Reason of
difference
138


( )
( : 2012.12.31)

( : )

...

(
(

139

Status of foreign holding subsidiaries


(No related issue)
(Base date:31 December 2012)
Catalog

(Unit: KRW)

A Holding
C
BCorporation
DCorporation
company
Corporation

...

Adjustment/c Amount
after
ombination

Sales
Internal sales
Net sales

( )
( )

( )

( )

( )

( )

Operation
income

( )

Income from
continuing
operation

( )

Profit or loss in
current quarter

( )

Total assets

( )

Total debts

( )

Owned capital

( )

Capital

( )

Auditors
Audit opinion

Note

140

XI.
-

141

XI. Financial Statements, etc.


No related issue as non-listing corporate

142

XII.
-

143

XII. Appendix
-No related issue as non-listing corporate

144


1.
( )

145

Confirmation of Experts
1.

confirmation of experts
(no related issue)

146

2.
( )

147

2.The interest of experts


(No related issue)

148