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Samsung's profits rise on memory chip and LCD sales
Net income rose to 1.86 trillion won (US$1.6 billion) from 1.5 trillion won a year ago, the company said in a release. Operating profit rose 63 percent and sales gained 22 percent, beating analysts' expectations. Samsung invested 6.7 trillion won last year, 54 percent more than rival Intel Corp., expanding production in two of the industry's fastest-growing areas as computer-memory chip prices slid. Samsung plans to boost spending to 7.9 trillion won this year and forecast demand will outstrip supply for flat screens and flash-memory chips. Chu Woo Sik, vice president of investor relations, said at a press conference that the company plans to buy back 2 trillion won of its shares, equivalent to 2.7 percent of the stock at today's closing price. Samsung plans to increase spending on memory chips for consumer electronics and computers to 3.9 trillion won this year from 3.6 trillion won last year, Chu said. Liquid crystal display [LCD] investment will fall to 1.8 trillion won from 2.08 trillion won. Operating profit for the fourth quarter rose to a record 2.6 trillion won from 1.6 trillion won, while sales rose to 12.9 trillion won from 10.59 trillion won. "It was a pretty good out-look," said Tejinder Sandhu, an analyst at HSBC Securities in Seoul. "Samsung is increasingly shying away from PCs to handsets and consumer electronics. That's good positioning," Sandhu said. Shipments of flat-panel LCDs, which accounted for 15 percent of the company's fourth-quarter sales, grew 40 percent from the third quarter, or double what the company expected in October, said Cho Yeong Duk, vice president of LCD operations. A shortage in LCDs will last through the first half of the year before there is oversupply in the second half, Cho said. Samsung is the world's No. 2 maker of LCDs. Fourth-quarter mobile phone sales rose 34 percent to 15.5 million handsets. Samsung, the world's third-largest producer, forecast sales will rise 17 percent this year to 65 million units, outpacing the company's 7 percent growth forecast for this year global handset sales of 510 million units. The company, the world's No. 1 computer memory chipmaker, said dynamic random access memory chip prices averaged less than US$6.50 in the fourth quarter, slightly higher than in the third quarter. It said it has one week's worth of DRAM stock left and the industry has four weeks' of inventory, while the industry has less than four weeks of inventory. From: http://www.taipeitimes.com/News/worldbiz/archives/2004/01/16/2003091639 |
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