Samsung CE Biz Posts 1.2% Q3 Sales Gain; Operating Income Slides

SEOUL, SOUTH KOREA— Although Samsung Electronics reported a relatively weak quarter for its digital media and digital appliance business segment, this division boasted strong business for digital television sales, which increased 34 percent in the third quarter, compared with the previous quarter.

Overall third quarter sales in the digital media segment, mainly CE, edged upward 1.2 percent to hit $1.61 billion, compared with $1.59 billion in the second quarter of 2003.

Third quarter operating income for digital media was $1.7 million, down 95.2 percent, compared with the previous three months, while profit margin slipped 2 percent. Samsung reported a 23 percent sales increase in 17-inch LCD monitors quarter-on-quarter and a 40 percent third quarter rise in DVD sales, compared with the second quarter.

Third quarter sales in Samsung's telecommunications segment, which includes mobile phones, climbed 17.7 percent, to $3.2 billion, compared with $2.7 billion in the second quarter of 2003. Wireless handsets held down $3 billion in sales during the third quarter, a 22.3 percent increase over the $2.4 billion registered in the second three months.

Telecommunications operating profit hit $644.2 million in the third quarter, a 35.6 percent rise over the second quarter, while quarter-on-quarter margin rose 2.6 percent. Samsung reported strong demand for high-end handsets with color screen, camera and camcorder functions, which drove up unit sales 25 percent, or 15-million units, in the telecommunications segment, compared with the second quarter.

Consolidated third quarter sales at Samsung reached $9.7 billion, up from $8.1 billion in the year-ago three months. Compared with the $8.5 billion registered in the second quarter of 2003, sales increased 14.5 percent. Consolidated operating income jumped 77 percent in the third quarter, hitting $1.8 billion, compared with $996.3 million in the second quarter. Third quarter operating income in 2002 was $1.5 billion. Consolidated net profit for the third quarter came in at $1.6 billion, a 62.8 percent increase over the $970.6 million reported in the second quarter. Third quarter 2002 net profit reached $1.4 billion.