Samsung Electronics Co Ltd has recorded a record first half profit of 1.34 trillion won ($1.12bn) in the year to June 30, up nearly 800% year-on-year from 150bn won ($125m). The figure exceeded analysts’ expectations with a survey of US brokers last week showing a forecast of 1.2 trillion won. Samsung spokesman James Chung told a press conference: Earnings jumped in the first half thanks to restructuring efforts and rising profits from sales of liquid crystal displays, telecommunications equipment and semiconductors.
The company has undergone major restructuring including massive lay-offs, particularly in the unprofitable home appliances sector. Despite a 50% drop in international DRAM prices this year, Samsung maintains high productivity and has a big exposure to higher-end chips which are less sensitive to price changes, said Chung. Revenue was up 15.2% to 12.13 trillion won ($10.1bn) in the first half, while the company’s debt-to-equity ratio fell to 114% by the end of June from 198% at the end of last year.
Analysts boosted their estimates of full-year profits to between 1.9 trillion ($1.58 billion) and 2 trillion won ($1.67bn), compared to last year’s 313.2bn won ($261m). The company expects revenue to grow to 22.3 trillion won ($18.6bn) this year. LG Electronics is also expected to report record profits for the first half thanks to both to operating profits of around 300bn won ($250m), about a trillion won ($833m) from its sale of the 41% stake it held in LG Semicon to Hyundai Electronics Industries, and a further $1.6bn from Philips for a stake in LG LCD.
