Kia 2006 Annual Report Download

Download and view the complete annual report

Please find the complete 2006 Kia annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 102

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102

Annual Report 2006
ⓒ

Table of contents

  • Page 1
    Annual Report 2006

  • Page 2
    ..._Europe plant(Kia Motors Slovakia) started mass production _Groundbreaking of US plant (Kia Motors Manufacturing Georgia) _Merged by Hyundai Motor Co. * This annual report contains performance results, financial data as well as the business outlook and strategies of Kia Motors Corp. The statements...

  • Page 3
    Contents 002 004 006 008 010 018 030 036 098 099 100 History Chairman's Message President's Message Line-up Solidifying Global Steps Looking at our Organic Growth Experiencing Kia Innovation Financial Review IR Information Five Year Summary Board of Directors

  • Page 4
    ... as a global 004 KIA MOTORS 2006 Annual Report maker in all areas including production, sales, marketing, branding, as well as before and after servicing. We will also concentrate on our Global Quality Management we have driven so far. We will first strengthen our basic competitiveness in terms of...

  • Page 5
    Mong-Koo Chung Kia Motors Corporation Chairman & CEO Chairman's Message

  • Page 6
    ... in the future global car market. Working on all of our key businesses on plan, we have made another new base of a successful global maker in global management, quality, branding, design, and services. The year 2006 will be the milestone in Kia's history. We have started building a plant with an...

  • Page 7
    ... corporate New Vision with a strong will. 2007 marks the second stage of our brand management program. We will evaluate and complement our brand strategy. And we are nurturing and enriching the depth of our car design portfolio as a core competitive advantage for product differentiation. Kia Motors...

  • Page 8
    LINE-UP Picanto 008 KIA MOTORS 2006 Annual Report Relish Every Living Moment of Your Life The Picanto is not just a car; it's your fashion statement designed for safety and that special feel. And the 1,000cc engine will provide a freedom that's yours alone. It will be love at first sight, and the...

  • Page 9
    ... Pleasure of Life Be it a stroll through a meadow or a commute in the city, let Carnival take you there. The image of Carnival is stylish durability packaged in a classy and versatile MPV at an optimum level of luxury and convenience for your driving pleasure. Carens / Rondo Everyday New Space...

  • Page 10
    ... Dealers * 14 Sales Subsidiaries (USA, Canada, Europe HQ, Germany, UK, Spain, France, Austria, Sweden, Belgium, Hungary, Czech, Poland, Australia) Gobal Production Network Europe plant (Slovakia) Korea plants - Hwasung plant - Sohari plant - Gwangju plant - Seosan plant (OEM) China plant US plant...

  • Page 11
    ...another step towards our vision to create a truly global operation. Hyundai Motor and Kia Motors plan to thrive and develop as a global automaker, so we need continuing growth in production and sales. Hyundai Motor and Kia Motors' 2006 global sales reached 3.8 million units, and the target for 2010...

  • Page 12
    ... & eye-catching new model - the cee'd - is born of our Slovakia plant, where Europe and Kia Motors meet. 012 KIA MOTORS 2006 Annual Report Location Capacity Product Zilina, Slovakia 300K cee'd, Sportage, etc. IN 2006, KIA MOTORS' STRONG GROWTH WAS FURTHER SOLIDIFIED IN EUROPE. CEE'D, WHICH HAS...

  • Page 13
    Meeting in Europe

  • Page 14
    ... perfection is building Kia Motors brand equity in overseas markets. 014 KIA MOTORS 2006 Annual Report Location Capacity Product Yancheng, Jiangsu 130K(#1), 300K(#2) Rio, Cerato, Optima, Sportage, Carnival, etc. ANOTHER PLANT IS UNDER CONSTRUCTION IN CHINA TO CAPITALIZE ON AMAZING GROWTH...

  • Page 15
    Driving in China

  • Page 16
    ... Product West Point, Georgia 300K SUV & PC (Strategic model for N.A.) KIA MOTORS IS DRIVING OUTWARDS TOWARDS THE WORLD, AND THE GEORGIA PLANT IN THE U.S. WILL BREATHE A NEW HEART INTO OUR DREAMS. A NEW SET OF DRUMS CAN BE HEARD IN THE DISTANCE, AS KIA MOTORS RACES AHEAD ON ROAD TO GLOBAL SUCCESS...

  • Page 17
    Creating in U.S.

  • Page 18
    Kia Motors continues to create a unique brand that inspires loyalty and clear value for its customers. We at Kia understand that our unique design DNA is the driving force to become a distinct global automaker. We are developing leading technology and designs that set us apart from our competitors. ...

  • Page 19
    Looking at our Organic Growth Our ever growing passion to build the world's best designs and technologies is pushing Kia Motors to become a global winner.

  • Page 20
    020 KIA MOTORS 2006 Annual Report Core Competitiveness for Growth Global R&D Network Hyundai-Kia R&D Center (Namyang) Location Hwasung, Gyeonggi Korea Facilities Structural Engineering Center, Design Center, Wind Tunnel, Driving Test Complex, Powertrain Center Environmental Technology R&D Center...

  • Page 21
    ...and Design Center Kia European Design Center (with Kia Motors Europe) In the heart of Europe, we have built a marvelous new facility to reinforce our design activities in the region. Location Frankfurt, Germany Japan R&D Center Focuses on leading edge technologies and design trend research to make...

  • Page 22
    ...'s design philosophy 022 KIA MOTORS 2006 Annual Report As a designer, I'm always looking to work in a fresh environment. And as a young company with a new and exciting brand, Kia Motors certainly provides that. One can really feel the spirit here as well as sense that there's huge potential...

  • Page 23
    ... brand positioning and overall company image." Kia Motors will share quality competitiveness such as platform and new technology with Hyundai Motor, and as for the design, Kia Motors will pursue the own unique identification for establishing distinct brand value in the global market. This is why we...

  • Page 24
    ... SUV's Style, targeting young family customers in their thirties 024 KIA MOTORS 2006 Annual Report ex_cee'd cee'd cabriolet concept car Classic cabrio with a traditional soft -top roof and aggressive, dynamic front styling pro_cee'd 3-door sporty hatch version of cee'd Sporty hatch model with its...

  • Page 25
    ... drivers to come Concept Car KCD- (Mesa) Large-sized SUV Modern, rugged body-on-frame SUV Kue Crossover utility vehicle Crossover concept focuses on sporty driving and hints at future design direction for Kia Kia Sport 5-door sporty hatch version of Rio Kia's first sporty hatchback concept car

  • Page 26
    026 KIA MOTORS 2006 Annual Report EXPERIENCE THE NEW KIA MOTORS!!

  • Page 27
    ... & Enabling' values of the Kia brand, while the Hyundai slogan - 'Drive your way' -- is designed to communicate the company's 'Refined & Confident' brand attributes. Kia Motors' brand slogan - 'The Power to Surprise' - embodies our deep-felt desire to maximize customer satisfaction ('to Surprise...

  • Page 28
    ...with a parallel-type hybrid system that boosts fuel economy. Kia and Hyundai have distributed Rio and Accent hybrid electric vehicles to public institutions (a total of 350 units in 2005, 380 units in 2006). We plan to develop mass-production systems for these vehicles as we invest an additional 300...

  • Page 29
    ... project of fuel cell automobiles in Korea 2007 - Planning to Develope and distribute hybrid electric automobiles(Rio/Accent) to public institutions(a total of 3,390 units in 2007/08) DEVELOPMENT HISTORY OF ECO-FRIENDLY AUTOMOBILES * CaFCP : California Fuel - Cell Partnership * EVS21 : 21st...

  • Page 30

  • Page 31
    ... Motors are channeling our energy into working harmoniously with a diverse range of communities so that we can constantly add value to society. Creating a more comfortable world and supporting neighbors in need is one of our prime social values. These values knit together every Kia Motors employee...

  • Page 32
    Excellence Delivering consistent value innovation for customers global competitiveness. 032 KIA MOTORS 2006 Annual Report IQS 2006 by J.D. Power - Entry into Middle Level In the J.D. Power and Associates 2006 Initial Quality Study, Kia Motors was ranked 24th among 37 brands. Originally prescribed to...

  • Page 33
    ... ...State motoring clubs (Australia) - Named 'Most Wanted' in U.S...Edmunds.com (USA) Cerato (Spectra) - Most Delightful Vehicle 2005 ...Strategic Vision (USA) Optima (Magentis) - Best in Quality of Ownership Experience ...Strategic Vision (USA) - Named Medium Car of the Year ...AMI Insurance (New...

  • Page 34
    Contribution Kia Creates a World with Dreams and a Future. 034 KIA MOTORS 2006 Annual Report Kia has been actively engaged in Corporate Social Responsibility (CSR) activities since 1991. The Hyundai - Kia Automotive Group donated US$100,000 to support relief efforts for victims of the earthquake ...

  • Page 35
    Kia Motors has been committed to improving people's lives through various community works to build a legacy of bright and hopeful society.

  • Page 36
    ...' Report Non-Consolidated Balance Sheets Non-Consolidated Statements of Income Non-Consolidated Statements of Appropriations of Retained Earnings Non-Consolidated Statements of Cash Flows Notes to Non-Consolidated Financial Statements Independent Accountants' Review Report on Internal Accounting...

  • Page 37
    Financial Review 2006 will indeed be an important turning point for Kia Motors as we attempt to secure stable growth for the next decades to come.

  • Page 38
    ... from the previous year, Hyundai and Kia Motors sales increased by 2.6%, thanks to our enhanced product quality and brand image. In Western Europe, sales continued to climb, boosted by the introduction of new models designed particularly for the EU and sports marketing activities. Sales growth has...

  • Page 39
    ... lines running smoothly. Automotive steel in Korea is supplied by POSCO, the world's biggest steelmaker, and Hyundai Hysco, an affiliate of the Hyundai Automotive Group. Auto parts and components are classified into three categories: made in plant (MIP), local parts (LP), and knocked down (KD) parts...

  • Page 40
    ...:80:50. Other Business Related Reference Details Sales Distribution Channel (2006) Category Domestic Overseas Regional Headquarters 18 Direct Management Branches 340 Dealerships 429 Worldwide including North America ; Overseas sales subsidiaries as the strategic points Sex, age group, and income...

  • Page 41
    ... raise customer satisfaction level. In the future our company plans to actively develop and provide various products and services through telecommunications sales channels to our customers. With regard to the automobile related membership business, we plan to develop various products and services...

  • Page 42
    .... Cultural marketing events included 'The Busan International Film Festival' and 'Korea-Russia Inter-Cultural Festival'. Kia continues to achieve higher level of customer satisfaction in a variety of fields. These efforts have allowed us to take top KS-SQI(Korean Standards - Service Quality Index...

  • Page 43
    ... year. We captured 1.8% of market share, 0.2% point higher than 2005. The operation of Slovakia plant has allowed us to reduce export volume to Europe while diverting most of the reduced volume to North America. In terms of the US, the export and retail sales of Spectra ('Cerato' in some markets...

  • Page 44
    ... 2005 level owing to an economic slump in Taiwan and Hong Kong. Finally, 2006 retail sales in other regions reached 187,524 units, similar to that of the previous year (188,197 units). Exports per Region (Unit) Region USA Canada Western Europe Eastern Europe/CIS Latin America Africa & Middle East...

  • Page 45
    ... at the Slovakia plant. We believe expanded advertising & sales promotions will create even higher level of passion for our key models including the New Carens ('Rondo' in some markets) and Sportage. We will be actively involved in all major auto shows and dealer-related events to share 'Kia Vision...

  • Page 46
    ... us to develop a truly global management: it will also boost demand in the mid-to-long-term horizon. Delivering the 'Kia in Europe' image to customers by publicizing the Slovakia plant and our European design center will be essential in accomplishing a success in Europe. Sports marketing campaigns...

  • Page 47
    ...are in planning. The Slovakia plant will be at the heart of all future success, as we feel it will be the cornerstone for us to develop a truly global management system and sustainable sales increase. Intense marketing efforts will center on the launch of the cee'd. The image of 'Kia in Europe' will...

  • Page 48
    ... 2005 428 322 2006 Credit Ratings There was no change related to credit ratings in 2006. Overseas credit rating maintained a double investment grade (S&P: BBB-, Moody's: Baa3), and both short-term 048 KIA MOTORS 2006 Annual Report and long-term domestic credit ratings remained at the top level...

  • Page 49
    ...competition and higher level of old stock during the period of model replacement. The marketing expense-to-revenue ratio was 4.0%: a rise of 1.6% point year on year. Kia is making concerted efforts to trim costs by working closely with all of our suppliers, including our sister company, to alleviate...

  • Page 50
    ... Debt Shareholders' Equity 12,106,605 631,608 6,858,849 2,940,150 5,247,756 2005 11,241,785 1,116,724 5,989,417 2,046,040 5,252,368 2004 10,685,879 1,560,517 5,721,456 1,691,219 4,964,423 Current Assets Cash balances at the end of 2006 including cash & cash equivalents, and short-term financial...

  • Page 51
    ... billion from the previous year. Capital increases were the result of our affiliated companies (Slovakia plant: 216 billion, China plant: 77 billion) and gains were the result of higher share values in equities we own (e.g.: Hyundai Mobis, Hyundai Steel). Tangible assets for 2006 totaled remained...

  • Page 52
    ...' Report Based on a report originally issued in Korean The Board of Directors and Stockholders Kia Motors Corporation: We have audited the accompanying non-consolidated balance sheet of Kia Motors Corporation (the "Company") as of December 31, 2006, and the related nonconsolidated statements of...

  • Page 53
    ... Balance Sheets December 31, 2006 and 2005 (In millions of Won) 2006 Assets 2005 Current assets: Cash and cash equivalents (note 16) Short-term financial instruments Accounts and notes receivable - trade, less discount on present value of and 2,338 in 2005 and allowance for doubtful accounts...

  • Page 54
    ... Balance Sheets December 31, 2006 and 2005 (In millions of Won) 2006 Liabilities and Stockholders' Equity 2005 Current liabilities: Accounts and notes payable - trade (notes 8 and 16) Short-term borrowings (notes 14 and 16) Provision for warranties (note 17) Accounts and notes payable...

  • Page 55
    ... gain, net Loss on scrapping of inventories Dividend income Equity in income of affiliates, net (note 7) Loss on sale of accounts and notes receivable - trade Gain on valuation of investment securities Other bad debt expenses Loss on impairment of investments Gain on sale of investments, net Gain on...

  • Page 56
    ... Reserve for technological development Dividends - nil in 2006 and 5% on par value at 250 Won per share in 2005 (note 28) 39,300 8,700 487,800 86,629 39,300 583,129 Unappropriated retained earnings to be carried over to subsequent year 61 24 056 KIA MOTORS 2006 Annual Report See accompanying...

  • Page 57
    ... valuation of investment securities Loss on sale of accounts and notes receivable - trade Other, net Changes in assets and liabilities: Increase in accounts and notes receivable - trade Decrease in long-term accounts receivable - trade Increase in inventories Increase in accounts receivable - other...

  • Page 58
    ...,077) 2005 560,000 1,949 11,457 195,501 28,640 102,453 13,554 (8,399) (232,315) (820,518) (320,571) (166,870) (11,227) 058 KIA MOTORS 2006 Annual Report Net cash used in investing activities (961,061) (646,346) Cash flows from financing activities: Proceeds from short-term borrowings Proceeds...

  • Page 59
    ... to Non-Consolidated Financial Statements December 31, 2006 and 2005 (1) Summary of Significant Accounting Policies and Basis of Presenting Financial Statements (a) Organization and Description of the Business Kia Motors Corporation (the"Company"), one of the leading motor vehicle manufacturers in...

  • Page 60
    ... credit rating agencies in Korea. Money market funds are recorded at the fair value determined by the investment management companies. Trading securities are classified as current assets, whereas available-for-sale securities and held-to-maturity securities are classified as long-term investments...

  • Page 61
    ... incurred. The Company reviews the property, plant and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when the expected estimated undiscounted future net cash flows from...

  • Page 62
    ... (p) Stock Options The stock option program allows the Company's employees to acquire shares of the Company for a specified price at specified times. The option exercise price is generally fixed at below the market price of underlying shares at the grant date. The Company values equity-settled stock...

  • Page 63
    ...unrealized gains and losses on investment securities that are reported as a separate component of capital adjustments. (t) Earnings Per Share Basic earnings per share are calculated by dividing net income by the weighed-average number of shares of common stock outstanding during each period. Diluted...

  • Page 64
    ... (millions) 2006 Long-term financial instruments 32 2005 32 (3) Transfers of Trade Accounts Receivable Outstanding trade accounts and notes receivable transferred to and discounted with banks, and excluded from the accompanying balance sheets, on which the Company remains contingently liable as...

  • Page 65
    ... Held-to-maturity securities 37,643 4,905 42,548 2005 47,459 2,727 50,186 (b) Available-for-sale securities (i) Marketable securities recorded at fair value: Won (millions) Percentage of ownership KT Freetel Co., Ltd. Hyundai Development Company SeAH Besteel Co., Ltd. Kanglim Co., Ltd. Other 0.12...

  • Page 66
    ... into equity method (*) Other changes in unrealized gains and losses Ending balance Income tax effect Net balance at end of period (6,835) 7,570 (1,950) 5,620 14,783 (378) 2005 140,114 (2,681) (145,155) 22,505 14,783 (4,065) 10,718 (*) Common stock of Hyundai Steel Company (formerly...

  • Page 67
    ... China Millennium Corp. Hyundai-Motor Group Ltd. Partecs Company, Ltd. Chasan Co., Ltd.(*1) Kia Motors Australia Pty Ltd. Yanji Kia Motors A/s and Repair WIA Automotive Engine (Shandong) Company(*1) NGVTEK.com Shares owned Percentage of ownership Cost Net assets Balance at December 31, 2006...

  • Page 68
    ... Hyundai Mobis Co., Ltd.(*1) Hyundai Hysco Co., Ltd.(*1) Hyundai Steel Company (formerly, INI Steel Co., Ltd.) Unlisted: Kia Motors America, Inc. Kia Canada, Inc. Kia Motors Deutschland GmbH Kia Motors Europe GmbH Shares owned Percentage of ownership Cost Net assets Balance at December 31, 2005...

  • Page 69
    ...cost and the Company's share of the fair value of investees' identifiable net assets as of December 31, 2006 are as follows: Won (millions) Affiliate Dongfeng Yueda Kia Motors Co., Ltd. Hyundai Mobis Co., Ltd. Kia Tigers Co., Ltd. Dymos Inc. WIA Corporation Hyundai Autonet Co., Ltd. Donghee Auto Co...

  • Page 70
    ... transactions for the year ended December 31, 2005 are as follows: Won (millions) Affiliate WIA Corporation Hyundai Hysco Co., Ltd. Inventory 732 64 685 3,167 19 106 133 4,906 070 KIA MOTORS 2006 Annual Report Hyundai Powertech Co., Ltd. Hyundai Mobis Co., Ltd. Hyundai Steel Company Dymos Inc...

  • Page 71
    ... America, Inc.(*1) Kia Canada, Inc.(*1) Kia Motors Deutschland GmbH(*1) Kia Motors Europe GmbH(*1) Kia Japan Co., Ltd. Kia Motors Slovakia S.r.o. Dongfeng Yueda Kia Motors Co., Ltd. Kia Tigers Co., Ltd.(*1) Hyundai Powertech Co., Ltd. Dymos Inc. WIA Corporation Haevichi Resort Co., Ltd. Donghee Auto...

  • Page 72
    ... and 2005 Also, the Company wrote off investments in PT.Kia Timor Motors and Kia Service Philippines Corp. and stopped applying equity method due to the closing of their businesses before prior year. (*2) Investments in small affiliates with total assets amounting to less than financial statements...

  • Page 73
    ... Engine (Shandong) Company Beijing Hyundai Mobis Automotive Parts Co., Ltd. TRW Steering Co., Ltd. Hyundai Card Co., Ltd. Autoever Systems Co., Ltd. AMCO Corp. EUKOR Car Carriers, Inc. China Millennium Corp. Hyundai-Motor Group Ltd. Partecs Company, Ltd. Kia Motors Australia Pty Ltd. Total assets...

  • Page 74
    ...: Parent Hyundai Motor Company Controlled subsidiary (*) Control relationship Ultimate controlling party Location USA Canada Germany Poland Slovakia Slovakia Germany Belgium Czech England Austria Hungary Spain Sweden France Japan China Korea Korea China Australia New Zealand 074 KIA MOTORS 2006...

  • Page 75
    ... of business with related companies for the year ended December 31, 2006 are summarized as follows: Won (millions) Related Company Hyundai Motor Company Kia Motors America, Inc. Kia Canada, Inc. Kia Motors Europe GmbH Kia Motors Polska Sp.z.o.o Kia Motors Australia Pty Ltd. Kia Motors Slovakia...

  • Page 76
    ... Financial Statements December 31, 2006 and 2005 Significant transactions which occurred in the normal course of business with related companies for the year ended December 31, 2005 are summarized as follows: Won (millions) Related Company Hyundai Motor Company Kia Motors America, Inc. Kia Canada...

  • Page 77
    ...2006 Related Company Receivables Accounts receivable - trade Other receivables Hyundai Motor Company Kia Motors America, Inc. Kia Canada, Inc. Kia Motors Europe GmbH Kia Motors Polska Sp.z.o.o Kia Motors Australia Pty Ltd. Kia Motors Slovakia S.r.o. Dongfeng Yueda Kia Motors Co., Ltd. Hyundai Mobis...

  • Page 78
    ... party Kia Motors Slovakia S.r.o. Kia Motors (UK) Ltd. Kia Motors Europe GmbH Kia Motors Australia Pty Ltd. Type of borrowings Plant loan and general loan Deferment from customs duties Guarantee of borrowings related to new construction of office building Leasehold deposit for office building EUR...

  • Page 79
    ... Lender The Korea Development Bank (9) Property, Plant and Equipment (a) Changes in property, plant and equipment for the year ended December 31, 2006 are as follows: Won (millions) Book value as of January 1, 2006 Land Buildings Structures Machinery and equipment Dies, molds and tools Vehicles...

  • Page 80
    ... to represent fair value. (10) Intangible Assets (a) Changes in intangible assets for the year ended December 31, 2006 are as follows: 080 KIA MOTORS 2006 Annual Report Won (millions) Development costs Net balance at beginning of year Increases Amortization Net balance at end of year 749,639 257...

  • Page 81
    ... (millons), USD (thousands) Assets Available-for-sale securities Land and buildings Land and buildings Lender Korean Defense Industry Association The Korea Development Bank, etc. Woori Bank Type of Borrowings Performance guaranty Long-term debt Vocational training and developmet fund Borrowing...

  • Page 82
    ...,049 (258,565) 1,474,784 082 KIA MOTORS 2006 Annual Report First Citicorp Leasing Inc.(*2) Korea Lease Financing Co., Ltd.(*2) CITI Corp.(*2) Korea Development Financing Corp(*2) CNH Capital Co., Ltd.(*2) ABN-AMRO Deutsche Bank Korea Eximbank Societe Generale Others(*2) Debentures: Debentures Less...

  • Page 83
    ... in foreign currency as of December 31, 2006 and 2005 are summarized as follows: 2006 Assets Foreign currency (in thousands) USD EUR CAD Accounts and notes receivable - trade USD EUR AED AUD CAD GBP Accounts receivable - other USD EUR AUD GBP Guarantee deposits USD 527,205 200,282 35,093 14,701...

  • Page 84
    ...976 42 Won equivalent (millions) 23,661 9,443 11,068 1,470 73 Accounts and notes payable - trade JPY 1,395,412 JPY 1,097,930 JPY 1,842,382 JPY 1,295,390 084 KIA MOTORS 2006 Annual Report SEK CAD AUD Accrued expenses JPY USD Short-term borrowings JPY 7,254,646 USD 100,322 287,358 74,496 Long...

  • Page 85
    ...used to guarantee the required payments to the retirees and accounted for as a reduction of the reserve balances. (19) Commitments and Contingencies (a) The Company has provided guarantees of 14,221 million to the banks which provide customer financing for long-term installment sales as of December...

  • Page 86
    ....01 Maturity date 2007.02.07~2007.03.07 Fair value 111 The Company's estimated period of its exposure to the variability of cash flows related to the above contracts is from February 2007 to March 2007. The contract is 086 KIA MOTORS 2006 Annual Report recorded at fair value with the unrealized...

  • Page 87
    ... determined by the court as the Company's reorganization claim and it was converted into capital stock, for which 142,953 new shares were issued. In accordance with the takeover contract with the Hyundai Motor Company, representing the Hyundai Motor Consortium, effective December 1, 1998, the...

  • Page 88
    ..., 4,368,690 shares of common stock (1.26% of total shares) owned by Hyundai Capital Co. also lost their voting rights under Article 11 of the Monopoly Regulation and Fair Trade Act of Korea. 088 KIA MOTORS 2006 Annual Report (22) Capital Surplus Capital surplus as of December 31, 2006 and 2005 are...

  • Page 89
    ... employee benefits Sales promotion Travel Communications Utilities Taxes and dues Rent Depreciation Amortization of intangible assets Repairs and maintenance Advertising Freight Supplies and stationery Commissions and fees Education and training Ordinary research and development Overseas marketing...

  • Page 90
    ...) 2006 Current Deferred 12,274 21,602 33,876 2005 25,262 (16,761) 8,501 090 KIA MOTORS 2006 Annual Report (b) The provision for income taxes calculated using the normal tax rates differs from the actual provision for the years ended December 31, 2006 for the following reasons: Won (millions...

  • Page 91
    ... Bad debts written off Dividend income Loss on impairment of investments Accrued expenses Provision for warranties Loss on impairment of property, plant and equipment Net operating loss carryforward Carryforwards of unused tax credits Tax reserve applicable to equity Others Total deferred tax assets...

  • Page 92
    ...,463 Deferred tax assets (liabilities) Current Non-current 49,227 10,461 72,461 2,130 10,053 38,346 092 KIA MOTORS 2006 Annual Report Accrued expenses Provision for warranties Loss on impairment of property, plant and equipment Carryforwards of unused tax credits Net operating loss carryforward...

  • Page 93
    ...: Won 2006 Dividend per share Market price as of year end Dividend yield ratio 13,450 % 2005 250 26,000 0.96% (29) Stock Options The Company granted stock options to its executive officers and directors in accordance with the stock option plan approved by the Board of Directors. The details...

  • Page 94
    ... 2006 and 2005 If all stock options, which require at least two-year continued services, are exercised, new shares or treasury stock will be issued in accordance with the decision of the Board of Directors. The Company calculates the total compensation expense using the option-pricing model. In the...

  • Page 95
    ... business globally and is managed geographically. The following table provides information for each geographical segment for the years ended December 31, 2006 and 2005: Won (millions) 2006 Domestic sales Export sales North America Europe Asia The Middle East / Africa Middle and south America...

  • Page 96
    ... a Report Originally Issued in Korean To the President of Kia Motors Corporation: We have reviewed the accompanying Report on the Operations of Internal Accounting Control System ("IACS") of Kia Motors Corporation (the "Company") as of December 31, 2006. The Company's management is responsible for...

  • Page 97
    ... Board of Directors and Audit Committee of Kia Motors Corporation: I, as the Internal Accounting Control Officer ("IACO") of Kia Motors Corporation (the"Company"), have assessed the status of the design and operations of the Company's Internal Accounting Control System ("IACS") for the year ended...

  • Page 98
    ... in Singapore by Morgan Stanley Investors Conference in Europe by BNP Paribas 098 KIA MOTORS 2006 Annual Report December Year-end Small Group Meetings with Investors Shareholder Structure (at December 31, 2006 / 2005, %) 2006 2005 38.67 38.67 Hyundai Motor Company 1.26 1.99 7.25 1.99 ES...

  • Page 99
    ...113 6,304,394 5,853,719 652,315 851,393 670,820 Total Assets Current Assets Non-current Assets Total Liabilities Current Liabilities Non-current Liabilities Total Shareholders' Equity Capital Stock Capital Surplus Retained Earnings Capital Adjustments 12,106,605 3,122,252 8,984,353 6,858,849 4,103...

  • Page 100
    ...Sales Division, Hyundai Hysco Currently, Executive Vice President & CFO, Kia Motors Corp. (Since March 16, 2007) 8. Jong-Chang Kim Graduated from the Department of Business Administration, Seoul National University President of the Tax Officials Training Center Head of the Seoul Regional Tax Office...

  • Page 101
    Kia Motors IR Team Title Head of IR Manager Assistant Manager Associate Associate Name Dong-Won Kang Hwan-Wook Lee Yong-Hyup Ko Sung-Yeon Hwang Su-Yeon Chae E-mail [email protected] [email protected] [email protected] [email protected] [email protected]

  • Page 102
    For Environmental protection, this catalog can be recycled Copyright 2006 by KIA MOTORS Corp. Produced by IR-Plus 231, Yangjae-Dong, Seocho-Gu, Seoul, Korea, 137-938 TEL : 82-2-3464-1114 www.kia.co.kr www.kmcir.com