Samsung Q1 sales, profits surge

Samsung Q1 sales, profits surge

Sales and profits at South Korea's largest electronics company, Samsung, surged in the first quarter of this year on better performance in the company's core semiconductor, liquid crystal display (LCD) and cellular telephone business units.

Samsung said revenue during the period from January to March this year was $US12.5 billion, as of the last day of the period being reported), which represents a rise of 50 per cent on the same period a year earlier. Net profit was $US2.75 billion, a rise of 178 per cent on the year.

Some of the best results came from Samsung's telecommunications division, which had the largest sales of the company's four main divisions during the period at $US4.2 billion, which is equivalent to 34 per cent of all sales.

Shipments of mobile telephone handsets jumped 52 per cent to 20.1 million units during the quarter of which 17.5 million were export shipments and the remaining 2.6 million were domestic.

The company credited the shipment growth to strong sales of high-end models such as those with cameras and colour screens, especially in the European and Asian GSM (Global System for Mobile Communications) markets.

Camera phones made up 34 per cent of all phones shipped in the quarter versus 25 per cent in the fourth quarter and those with colour screens made up 81 per cent of all handsets in the quarter against 73 per cent in the previous quarter, it said.

Samsung said it expected continued shipment growth in the second quarter but didn't provide any figures.

For the full year it said it would achieve "much, much more" than the previously predicted annual shipment of 65 million units but did not provide a new figure.

Samsung expected the worldwide cellular handset market to grow from about 510 million units in 2003 to 560 million units.

Models with two- and three-megapixel camera functions were being planned for this year, it said.

In the semiconductor division, which reported sales of $US3.7 billion or about 29 per cent of all sales, a jump in the price of dynamic RAM (DRAM) chips helped the company achieve double digit revenue growth for (synchronous DRAM (SDRAM) sales.

Flash memory sales also increased, it said.

The company's LCD business was helped by increasing demand for panels for use in computer monitors and televisions and a firming of panel prices and made up around 16 per cent of all sales, the company said.

Shipments of large-size panels hit 2.5 million per month during March, vice-president of the company's LCD business unit, Cho Yeong Duk, said.

Samsung planned to increase production at its number six line from 65,000 panels per month currently to 100,000 per month by the middle of this year to match that of its number five line, he said.

A further decline in panel prices was expected as competition from Taiwanese manufacturers was expected to increase.

Samsung expected prices between now and the end of the year to fall about 10 per cent for computer panels and between 20 per cent and 30 per cent for TV panels.

The digital media and digital appliance division was helped by increased domestic sales, worldwide sales of digital televisions and improvements in its computer printer business.

The division was responsible for about 20 per cent of all sales during the quarter.

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