Text Fwd: Samsung Reports Record Quarterly Income of $3.5 Bil.

* Korea Times
0-06-2009 18:16
Samsung Reports Record Quarterly Income of $3.5 Bil.
By Kim Tong-hyung
Staff Reporter

Samsung Electronics braved weak demand and the global economic downturn to post a record-high quarterly operating income of $3.5 billion on the back of strong worldwide sales of consumer electronics and mobile phones.

In a preliminary report Tuesday, the company estimated that it had 4.1 trillion won (about $3.5 billion) in operating profit and 36 trillion won in sales in the third quarter. The company may achieve a landmark record of 10 trillion won in operating profit on 100 trillion won in sales this year.

The company will release its official third-quarter earnings Oct. 30.

Analysts predict, however, that the company might see a slower fourth-quarter, a traditionally weak period for technology companies.

And the strengthening Korean won, which is finally starting to regain its value against the U.S. dollar, is adding to the uncertainty.

Samsung is currently the world's largest manufacturer of memory chips and flat-screen televisions and also the No. 2 handset vendor.

``Considering that Samsung increased its spending on marketing to boost its shares in mobile phones and consumer electronics, its third-quarter performance is impressive,'' said Greg Noh, an analyst from HMC Investment Securities.

Samsung's impressive performance was driven by its semiconductors and LCD business, each of which is believed to have generated more than 1 trillion won in operating profit.

Its semiconductor unit posted an operating loss of 670 billion won in the first quarter before rising to a profit of 240 billion won in the second quarter, thanks to the doubling of DDR2 DRAM prices.

Samsung had rebounded from a 310-billion-won operating loss in LCDs to a 150-billion-won gain in the second quarter.

The company has clearly benefited from the rise in demand for LCD panels over the past months, analysts say, although prices for a certain range of products, such as computer monitor panels, are starting to fluctuate.

The early-year struggles in its semiconductor and LCD business had Samsung relying on mobile phones and LCD televisions. It is estimated that the company earned about 1 trillion won in operating profit each from its handset and television businesses in the third quarter.

The electronics giant captured 20 percent of the global handset market as the No. 2 maker, trailing Nokia in leadership.

And the company has been the world's largest seller of flat-panel televisions for the past 12 quarters. This year, Samsung benefited from being quick out of the gate in light-emitting diode (LED)-backlit LCD televisions, the latest buzzword in consumer electronics, although rivals are quickly gaining with similar products.

Industry analysts expect Samsung to experience a fall in its mobile phone and television business during the fourth quarter, although its revived semiconductor business could fill the void.

thkim@koreatimes.co.kr


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2009/10/06 09:42 KST
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SEOUL, Oct. 6 (Yonhap)