Samsung Reports the Highest Profit Of 8 Trillion Won In the First Half Of the Year

Samsung Group recorded the highest business results ever in the first half of this year, with the group’s sales amounting to 68 trillion won and pretax income reaching 8 trillion 200 billion won. The pretax income has increased 1.8 times compared with the 4 trillion 600 billion won pretax income in the first half of last year and exceeded the total profits of 7 trillion 200 billion won reported last year.

On a press conference held July 18, Lee Hak-su, the Chief of Samsung’s Restructuring Department, said that thanks to the high business results of Samsung Group’s 22 affiliates the group was expecting its profits for the first half of this year to be twice as much as the group had initially expected.

Mr. Lee also added that Samsung’s annual pretax income is expected to reach 15 trillion won this year, much more than was initially predicted, for the first time in the group’s history. The group expects its annual sales to exceed the initial forecast of 125 trillion won to 127 trillion won, recording 132 trillion won to 134 trillion won.

Such a leap in Samsung’s results in the first year half is attributed to higher semiconductor prices and boosted sales.

Samsung did not announce the results of each of its affiliates that day. But taking into account the overall group results, chances are that the results of Samsung Electronics for the 2nd quarter of the year (April ∼June) which the company will announce July 19 will be higher than those achieved in the first quarter.

Samsung has allotted 6 trillion 500 billion won for this year’s equipment investments, 1.5 trillion won more than the initially planned 5 trillion won.

Semiconductor 12-inch wafer and the extension of the handheld phone and the 5th generation TFT-LCD lines that were suspended at the end of last year and beginning of this year due to the economic slump have been added again to the group’s investment plans.

As the most detrimental to business environment factors in the second half of this year, Mr. Lee named unstable foreign exchange rate, slow economic recovery of the U.S. and IT markets, inconsistent national policies caused by presidential elections and excessive debts.

“Samsung has 13 or 14 product items that currently have the leading market share in the global market thanks to our successful restructuring efforts after the financial crisis, and we expect our business results to be as good in the remaining half of the year as they were in the first half thanks to the rising demand and high prices for semiconductors, mobile phones and LCDs”, said Lee.

Yeon-Su Shin ysshin@donga.com