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1Q 2016 IR Report As of May 2016

Kumho Tire

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Contents

CONTENTS

Ⅰ. 1Q 2016 Earnings Result

Ⅱ. 1Q 2016 Financial Status

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[Unit: 100Mil KRW, %]

2015 4Q QoQ YoY 2015 1Q

7,544 7,842 7,018 -10.5% -7.0%

5,577 (74.9%)

5,799 (73.9%)

5,295 (75.4%)

-8.7% -5.1%

440 (5.8%)

427 (5.4%)

151 (2.2%)

-64.7% -65.7%

134 (1.8%)

-558 (-7.1%)

-131 (-1.9%)

76.5% Turn to

Loss

484 546 546 -0.1% 12.8%

924 (12.2%)

974 (12.4%)

697 (9.9%)

-28.4% -24.6%

1Q16 Earnings Result – Financial Snapshot 2016 1Q

EBITDA

Sales

COGS

Operating

Profit

Ordinary

Profit

Depreciation

2016 1Q

1Q recorded sales of 7,018 100milKRW (-7.0% YoY) and operating profit of 151 100milKRW (-65.7% YoY),

due to 1) decreased production of car makers; 2) one-off cost by labor-management agreement.

IR

3

177 158 157

2015 1Q 2015 4Q 2016 1Q

North America

Others

112

132

95

2014 4Q 2015 4Q 2016 1Q

China

Korea

89 88 91

2015 1Q 2015 4Q 2016 1Q

Europe

754 784 702

2015 1Q 2015 4Q 2016 1Q

Global Sales

161 141 148

2015 1Q 2015 4Q 2016 1Q

215

275

211

2015 1Q 2015 4Q 2016 1Q

QoQ -0.6%

YoY -11.3% QoQ 3.4%

YoY 2.2% QoQ -23.3%

YoY -1.9%

QoQ -28.0%

YoY -15.2% QoQ -10.5%

YoY -7.0%

QoQ 5.0%

YoY -8.1%

2016 1Q

- OE sales in Korea and China stagnated with decreased utilization of car makers,

along with decreased China RE sales by severe market competition.

- Sales in EU slightly increased as the market demand and FX rate were favorable.

1Q16 Earnings Result – Regional Snapshot

[Unit: Bil KRW, %]

Note: “Others” Included Kumho Asiana Main Tower Co.,Inc

IR

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5.8% 7.0%

-0.8%

5.4%

2.2%

OPM

754 785

717

784

702

44 55 15

2015 1Q 2015 2Q 2015 3Q 2015 4Q 2016 1Q

Sales Operating Profit

Global

-6 45

2016 1Q IR 1Q16 Sales & Operating Profit - Global

- Sales decreased (-7.0% YoY) with stagnated OE sales in severe market competition, caused by

raw-material tailwind.

- Operating profit decreased (-65.7% YoY) as one-off cost from labor-management agreement.

[Unit: Bil KRW, %] Global 1Q Review

Market Status

Car sales of USA and EU increased with lower oil price, contributing to

favorable RE tire market condition.

In China and Korea market, Hyundai/Kia utilization rate decreased.

Compared to 2015, weak KRW in 1Q16 positively affected.

Results of Kumho Tire (YoY)

Although the market demand in USA and EU was favorable,

RE Sales stagnated with severe competition.

Inventory adjustment of car makers in China market resulted in

OE sales decrease, as tire-supplying car models decrease.

In emerging market, fluctuation of FX rate resulted in weak tire demand.

Extraordinary expense negatively affected operating profit

- Lump sum from labor-management agreement and wage increase

Outlook for the Next Quarter

New plant in Georgia, USA, completed in 2Q16 – M/S increased in US

market expected with reinforced high-inch tire manufacturing.

Additional OE tire supply and contract securement are expected.

New supply for dealers in USA/EU is to contribute sales increase.

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1Q16 Sales & Operating Profit - Korea

7.0% 5.3%

-2.5% -4.2%

3.6%

OPM

601

670

515

610 574

42 36 -26

2015 1Q 2015 2Q 2015 3Q 2015 4Q 2016 1Q

Sales Operating Profit

-13 21

2016 1Q IR

[Unit: Bil KRW, %] Korea

- In Korea, sales decreased (-4.5% YoY) with stagnated OE tire sales, resulted from car makers’

decision to cut production.

- Operating profit decreased (-50.3% YoY) as extraordinary expense of labor-management agreement.

1Q Review

Market Status

Manufactured cars in Korea market in 1Q16: -3.6% YoY

No. of cars sold in Korea market in 1Q16: -5.1% YoY

Domestic sales of car increased with individual consumption tax

discount (+6.9% YoY) – however, export sales of car decreased

(-10.8% YoY) by recession in China and emerging markets.

Results of Kumho Tire (YoY)

RE tire sales volume increased with reinforced consumer promotion

and expansion of distribution channels.

Weak OE tire sales with car makers’ production cut and ASP decrease

with raw-material tailwind.

Weak export caused by 1) decreased orders by market recession;

2) currencies devaluation in countries of Asia and Latin America.

Outlook for the Next Quarter

Sales expansion of highly-profitable product, such as UHP tires,

will be executed.

Securing additional OE tire supply to meet OE sales target.

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1Q16 Sales & Operating Profit - China

186

234

186

242

156

2015 1Q 2015 2Q 2015 3Q 2015 4Q 2016 1Q

Sales Operating Profit

-1.6% 5.7%

-5.2%

17.3%

-6.2%

OPM

42

-3 13 -10 -10

2016 1Q IR

- Sales decreased (-16.4% YoY) with 1) weak export caused by recession in emerging market;

2) weak RE/OE sales in china, cause by sales decrease of cars to which Kumho Tire is supplying.

- Operating profit decreased (-224.1% YoY) with utilization rate decline.

[Unit: Bil KRW, %] China 1Q Review

Market Status

Sales volume of cars in China increased +6.8% YoY, owing to tax

benefits by government policy.

Demand for high-inch tires increased, with rapid growth of MPV

and SUV.

Results of Kumho Tire (YoY)

OE tire sales decreased with the car sales decline that Kumho tire is

supplying, along with ASP decrease.

RE tire sales volume and ASP decreased with severe competition

in China domestic market.

Recession in emerging market and decreased demand for china-

manufactured tires also affected weak sales.

Outlook for the Next Quarter

RE sales volume increase expected with business district development

through subdividing distribution channels.

Preventing delays in providing tires to new car models and stabilizing

supply will be executed.

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2016 1Q IR Regional Sales Breakdown & UHP Tire Sales

■ Regional Sales Breakdown

■ Global Sales Trend of High-inch Tires

Note:

Figures based on tires sales only

Korea North

America China EU

Latin

America ETC Global

2015 1Q 27.5% 19.0% 20.6% 14.4% 5.9% 12.6% 100.0%

2016 1Q 28.2% 17.5% 20.4% 14.7% 5.2% 14.0% 100.0%

Sales ratio of high-inch tires (above 17 inches) continuously increased, showing 36.0% in 1Q16

The portion of high-inch tires is expected to record more than 40%, as new US plant started to operate

and relocation of Nanjing plant is to be completed in 2017

36.0%

2011 2012 2013

20.1%

2014 2010

Note: Units of tires above 17 inches, based on PC/LT tires sales

2016 1Q

The Rest

High-inch Tires

22.7% 25.4% 27.4% 31.7% 35.6%

2015

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Global Production

6,626

7,495

6,561

2015 1Q 2015 4Q 2016 1Q

Korea China Vietnam

Global

817

872 865

2015 1Q 2015 4Q 2016 1Q

11,970 13,169

11,308

2015 1Q 2015 4Q 2016 1Q

2016 1Q

[Unit: 1,000] ■ Global Production in 1Q16: -14.1% QoQ, -5.5% YoY

4,527 4,802

3,883

2015 1Q 2015 4Q 2016 1Q

IR

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Natural Rubber :

Until March, price of natural rubber maintained weak with the recession in China,

then showed rebound along with other raw-materials price rally.

Synthetic Rubber :

Maintenance of synthetic rubber plants resulted in supply shortage and increase

of B/D price. However, the weak trend continued with ongoing global recession.

2,478

2,208

1,941

1,808

1,661 1,617

1,687

1,596

1,402

2,537

2,405

2,431 2,463

2,181

2,023 2,065

1,950

1,799

2,104

2,005 1,940

1,925

1,774 1,687 1,697

1,614

1,498

2014 1Q 2014 2Q 2014 3Q 2014 4Q 2015 1Q 2015 2Q 2015 3Q 2015 4Q 2016 1Q

[USD/ton]

S/R QoQ -7.7%

YoY -17.5%

Total QoQ -7.2%

YoY -15.6%

N/R QoQ -12.2%

YoY -15.6%

N/R

22.5%

S/R

26.6% T/CORD

10.7%

S/CORD

9.8%

C/Black

9.8%

ETC

20.6%

[2016 1Q]

Raw Material

Breakdown

2016 1Q IR Trend of Raw Material Cost

■ Raw material input cost in 1Q16 additionally decreased QoQ, YoY

■ Trend of Raw Material Cost (Based on Input Cost)

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2016 1Q IR Financial Status

(Unit: 100 Million KRW) (1) Income Statement - Consolidated

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2016 1Q IR

(Unit: 100 Million KRW)

Financial Status

(2) Balance Sheet - Consolidated

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2016 1Q IR

(Unit: 100 Million KRW)

Financial Status

(3) Income Statement - Korea

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2016 1Q IR Financial Status

(4) Balance Sheet - Korea (Unit: 100 Million KRW)

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