SAMSUNG ELECTRONICS, Asia’s largest consumer-electronics company, yesterday reported a record quarterly profit on surging sales of Galaxy phones and a one-time gain from selling its hard-disk drive business.
Operating profit increased 73 per cent to 5.2 trillion won in the three months to the end of December, the South Korea-based company said in a statement today. That beat estimates.
Sales rose 12 per cent to 47 trillion won. Mobile phone sales surpassed a record 300 million units last year as Galaxy smartphones helped win consumers amid competition with Apple’s iPhone.
Samsung, which sold its hard-disk drive business to Seagate Technology, is introducing more mobile devices to offset slumping profits at the chip and flat-screen panel businesses.
“The mobile business is generating a huge chunk of profit now,” James Song, a Seoul-based analyst at Daewoo Securities, said. “It may be getting harder for Apple to catch up because they only have a limited number of models.”
Samsung shares fell 1.4 per cent to 1,040,000 won at the close of trading in Seoul, while the benchmark Kospi index declined 1.1 per cent. The stock gained 11 per cent in 2011.
While smartphone sales helped propel Samsung’s revenue to a record last year, fourth-quarter operating profit was inflated by proceeds from the Seagate deal, James Chung, a spokesman for company, said after the announcement. Samsung said in April it had agreed to sell its mechanical-drive business to Dublin-based Seagate for $1.38 billion in cash and stock. Samsung said last month the sale was completed.
Operating profit may be 200 billion won higher or lower than yesterday’s preliminary estimate when audited results are announced later this month, Samsung said.
The company didn’t provide net income figures or a breakdown of divisional earnings. Samsung’s full-year profit sales rose 6.5 per cent to a record 164.7 trillion won, while operating profit declined 6.7 per cent to 16.2 trillion won.
Samsung overtook Apple in the third quarter to become the world’s largest smartphone seller after shipping 27.8 million units, Strategy Analytics said in October. – (Bloomberg)
