Slow Recovery
Samsung Electronics’ revenue for the fourth quarter last year was 52.73 trillion won (US$48.22 billion), while the operating profits were 5.29 trillion won (US$4.84 billion).
Even in these unstable conditions, including foreign exchange fluctuations and the rapid drop in oil prices, the company improved its performance thanks to a favorable turn in the semiconductor business and an increase in sales of display panels. In the situation where the overall businesses are improving, the sales increased by nearly 11 percent from the previous quarter, while the operating profits increased by 1.2 trillion won (US$1.1 billion). Also, the profit rate improved slightly.
In the fourth quarter, when the exchange rate fluctuated sharply, the parts business benefited from the strong dollar, while the set business was adversely affected by weak currency in emerging countries. With advantages offsetting disadvantages, the exchange rate had no strong effect on the overall performance.
For the parts business, the memory steadily remained in great demand due to peak season effects, expanding the sales of high value-added products. Also, as the rate of operation improved due to the increasing supply of 20 nm application processors (AP), performance in the System LSI division improved as well.
For the display business, sales of high-value-added LCD panels increased, as well as the sales of premium OLED panel products.
For the IT & Mobile Communications (IM) division, the sales of high-end products, including the Galaxy Note 4, increased. Accordingly, the average sales price improved and the distributor’s stock remained stable, leading improvement in its performance.
Samsung Electronics predicted that uncertainty in the global business environment will increase this year due to the economic slump in the Eurozone and financial risks in emerging countries.
It also predicted that it will have stable results in the DRAM, LCD panel, and TV sectors, based on its differentiated technology and high value-added products. For the smartphone and OLED panel sectors, the company is planning to focus on recovering the performance based on cost competitiveness and product differentiation.
Also, the company expected that this year will be the year to establish the basis for new growth based on leadership in NAND Flash technology and the System LSI divisions.