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Technology Stocks : Samsung and Wireless -- Ignore unavailable to you. Want to Upgrade?

To: Eric L who wrote (47)	4/19/2002 7:59:21 AM
From: elmatador	Read Replies (1) \| Respond to of 374

Chips and mobiles lift Samsung to record profits By Andrew Ward in Seoul Published: April 19 2002 10:16 \| Last Updated: April 19 2002 11:28 South Korea's Samsung Electronics, the world's largest memory chipmaker, on Friday announced record first quarter net profits, driven by the recent recovery in semiconductor prices and increased mobile phone sales. Samsung generated Won1,900bn ($1.45bn) of net profit in the first three months of the year, up 53 per cent from last year's Won1,2400bn, and in line with analysts' expectations. The results underlined the semiconductor industry's recovery from last year's slump and confirmed Samsung's status as one of the world's best-performing electronics and information technology manufacturers. Samsung's growth contrasted with gloomy news elsewhere in the information technology industry this week, as Nokia, the world's largest handset maker, cut its sales forecast, and Microsoft's quarterly earnings missed analysts' expectations. The South Korean company said it sold D-Ram chips at an average of $4.5 each in the first quarter, compared with prices below $1 last November. The increase returned the semiconductor division to an operating profit of Won2,100bn from a Won212bn loss in the previous quarter but the figure was nearly 4 per cent lower than last year's first quarter. Samsung said the upswing in chip prices would stall in the second quarter as corporate spending on information technology remained sluggish but forecast that its contract prices would remain stable. The company plans to increase investment in plants and facilities this year by Won1,500bn to Won4,550bn. Operating profits in the telecommunications division more than tripled to Won800bn from Won231bn a year earlier, reflecting surging growth in Samsung's share of the world mobile phone market. Samsung is vying with Siemens of Germany for the number three slot in the ranking of global handset manufacturers. Samsung sold 9.5m handsets in the first quarter and targeted 37m by the year-end. The company has focused on advanced handsets with colour screens and sophisticated ring tones, aimed at the high end of the market. The South Korean company has reinvented itself in recent years from a volume producer of cheap electronics to a high quality manufacturer focused on digital technologies. Heavy investment on marketing and product design made Samsung the world's second-fastest growing brand last year, after Starbucks, the coffee shop chain. On Friday, Samsung's market capitalisation stood at $47.6bn, close to that of Sony, its more established Japanese rival, which is valued at $50.3bn. Samsung's results are the latest in a string of strong first-quarter earnings announcements by South Korean companies, underlining the improving profitability of the country's corporate sector, which was restructured following Asia's 1997 financial crisis. On Thursday, LG Electronics, Samsung's biggest domestic rival, posted a 24 per cent year-on-year increase in operating profits. Earlier in the week Hynix Semiconductor, South Korea's number two chipmaker, returned to profitability for the first time in 15 months.