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Samsung Electronics has record sales

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Jan 08,2010
Samsung Electronics, Korea’s largest company by market value, saw record quarterly sales during the fourth quarter last year, according to the company’s earnings forecast released yesterday.

The company said that during all of 2009, its sales, including those by overseas branches, are estimated at 136.05 trillion won ($119.8 billion), while operating profit is expected to total 10.92 trillion won.

With these estimates, Samsung Electronics is the first local company to break the “100 trillion -10 trillion” mark for annual sales and operating profits.

Its fourth-quarter sales are estimated at 39 trillion won, up 18.2 percent over the same period the previous year, while operating profits are predicted to be 3.7 trillion won. That compares to a 740 billion won loss during the fourth quarter of 2008.

On-quarter however, the company’s operating profit is forecast to fall 12.5 percent. “The decline in operating profit during the fourth quarter is due traditionally to higher marketing costs at the end of the year as well as bonus payments given to employees,” said Kim Seung-in, an analyst at Kiwoom Securities.

Samsung attributed its record sales to a rise in memory chip and flat-screen TV prices globally as well as boosted demand for the latest mobile phones and TV sets.

“Memory chip revenue was a big factor in Samsung’s sales record during the fourth quarter. Except for Samsung, other global chipmakers have not been doing so well during 2009,” said Baik Gae-yer, an analyst at Korea Investment Trust Management. He added that in 2009, Korean exporters, including Samsung Electronics, have recovered faster than other global companies including U.S.-based GE, aided by price competitiveness due to favorable currency exchange rates.

Comparatively, Micron Technology, the No.1 memory chip company in the U.S., said it saw its first quarterly profit in more than two years.

Samsung Electronics will announce official fourth-quarter earnings later this month. The company started announcing quarterly earnings forecasts last July to minimize confusion in the market resulting from different earnings forecasts from other institutions and analysts.

Meanwhile, the company’s stock fell 3.3 percent yesterday to 813,000 won despite its record sales announcement. Many analysts attributed this to profit taking by investors.


By Cho Jae-eun [jainnie@joongang.co.kr]



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