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Samsung Q2 Sales Rise 45%, Profit Jumps

7/19/2004 01:21:00 PM Eastern

Seoul, South Korea — Samsung reported a second-quarter consolidated sales jump of 45 percent, hitting $12.9 billion for the three months, compared with $8.4 billion in the year-ago period.

Consolidated operating income increased 222 percent to $3.2 billion, up from $993.1 million in the same quarter in 2003, while consolidated net income soared 177 percent, reaching $2.7 billion, compared with $967.4 billion year-on-year.

The company’s digital media business, which includes digital televisions, DVD players and computers, recorded $1.7 billion in second quarter sales, up from the $1.6 billion registered in the same three months in 2003. The company expects demand for digital TVs to increase in the second half, with some of this hike coming from a boost in sales arising from interest in the Olympics.

Even with the increase in second-quarter consumer electronics sales, the digital-media segment posted an operating loss of $6 million, which compares with a profit of $34.2 million in the same three months last year.

Samsung’s telecommunication network business, which includes mobile handsets, registered sales of $4.2 billion in the second quarter, with operating profit of $68.8 million. Unit sales of handsets hit 22.7 million, with market share rising to about 14 percent to 15 percent, said the company.

Even with pricing pressure and a rise in marketing costs in the “fiercely competitive” United States market, the telecommunications segment recorded a 16.1 percent operating margin. The company said cellphone sales should reach 86 million for the year, with strong sales from the launch of new models in the third quarter.

The company’s LCD business claimed $2.1 billion in sales in the second quarter, with operating income for the segment hitting $70.5 million. Operating margin hit 33.1percent. Samsung reported that concerns about declining sales for LCD panel manufacturers, due to slowed growth of the DTV market, did not occur.

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