Samsung Breaks Revenue Record

Samsung Electronics posts revenue of 12.89 trillion, up 14.4% from the previous quarter; telecom revenue was 3.9 trillion

April 16, 2004

3 Min Read

SEOUL, Korea -- Samsung Electronics has announced its revenue and income results for the fourth quarter. Revenue reached 12.89 trillion won, while operating income and net income were 2.63 and 1.86 trillion won, respectively, for the quarter. Revenue and operating income for the fourth quarter were both new records. Revenue was up 14.4% from the previous quarter, and operating income increased 20.8% from the previous record, set in the third quarter of 2000.

Quarter on quarter, operating income and the net income increased by 27.9 and 1.1 percent, respectively. The figures also represent significantly improved year-on-year performance. Operating income surged a whopping 63.4 percent from the fourth quarter of 2002, while revenue and net income also improved by 21.7 and 24 percent year on year. The fiscal year 2003 totals were 43.58 trillion won in revenue, 7.19 trillion won in operating income and 5.96 trillion won in net income. Along with the record-breaking revenue, operating income and net income were outstanding, with both approaching records set in 2000 and 2002.

This robust financial performance demonstrates Samsung Electronics' efficient business structure. High dependency on DRAMs and mobile handsets has been mitigated, as the product portfolio is now more evenly spread over other key business areas such as TFT-LCDs, flash memory, and digital TVs.

Revenues for each of Samsung Electronics' four main business units—the Device Solution (DS) Network, Telecommunication (TN) Network, Digital Media (DM) Network, and Digital Appliance Network—all increased quarter on quarter by 23.3%, 5.4%, 14%, and 11.2%, respectively, to total 5.86, 3.94, 2.13 and 0.86 trillion won in the fourth quarter. Fourth quarter operating income was 2.02 trillion for DS, 730 billion for TN, 3 billion for DM, and - 80 billion won for DA.

The memory and TFT-LCD divisions turned in particularly notable performances. Explosive growth in flash memory demand fueled a 18% quarterly increase in revenue for the Memory Division to reach 3.02 trillion won. The performance for the TFT-LCD division was even more impressive with a 42% quarter-on-quarter growth in revenue to total 1.96 trillion won. The combined operating income for the Device Solution Network business, which includes the Memory, TFT-LCD, and System LSI Divisions, exceeded 2.02 trillion won for the first time, grew by 49.6 quarter on quarter. The operating margin was at 34.5 percent.

The performance of the Telecommunication Network Business, which includes the Mobile Phone Division, also deserves attention. Robust demand for high-end handsets with camera and camcorder capabilities drove revenue to a new quarterly record of 3.9 trillion won. The number of units shipped in the fourth quarter, 16 million, was also a new record. An operating margin of 18.5% confirms the sustained competitiveness of Samsung handsets.

The relatively weak performance of the Digital Media business is expected to improve as demand for flat-panel, high-definition, and digital TVs starts to gain momentum. Samsung Electronics' sound financial structure allowed aggressive capital spending plans. Earlier this week, Samsung Electronics announced the plans to invest 1.2 trillion won in the 13th line, and additional 2.7 trillion won in the 7 th generation TFT-LCD line. The overall capital expenditure plan for the 2004 will increase by 18% from 2003, reaching 7.92 trillion won.

Samsung Electronics Co. Ltd.

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