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Samsung announces Q2 2012 earnings

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Samsung Electronics has announced revenues of R345,3-billion on a consolidated basis for the second quarter ended 30 June 2012, a 21% increase year-on-year. For the quarter, the company’s consolidated operating profit reached a record R48,7-billion, representing a 79% increase year-on-year. Consolidated net profit for the April-June period was R37,6-billion.
In its earnings guidance disclosed on July 6, Samsung estimated second quarter consolidated revenues would reach approximately R340,9-billion with consolidated operating profit of approximately R48,6-billion.
Samsung posted solid sales and maintained its profit streak in the second quarter across all business segments, excluding semiconductors, amid lingering global business uncertainties.
Digital Media & Communications – comprising the Consumer Electronics and IT & Mobile Communications business sectors – accounted for R265,3-billion in sales, up 37% year-on-year.
For Device Solutions, the results were mixed. While operating profit for the Display Panel segment registered an on-year increase, the Semiconductor Business saw profits drop by 38% compared with the same period last year, despite outperforming the previous quarter.
By business unit, the Mobile Communications Business was one of the leading growth drivers in the June quarter with R148,8-billion in revenue. With the successful launch of this year’s flagship GALAXY S III smartphone and robust GALAXY Note sales, the handset unit saw earnings jump by 75% from a year earlier.
The Visual Display Business also contributed to earnings gains with its diverse portfolio of TV models for both developed and emerging markets with R62,24-billion in revenue for the quarter.
“Despite a difficult business environment, we achieved stable profits in the second quarter through our differentiated products and competitive technology,” says Robert Yi, senior VP and head of Investor Relations.
“As we move into the second half, continued fiscal instability in Europe and its effect on the global economy will result in the possibility of a slower-than-expected recovery and intensified market competition.”
Yi adds that despite the economic uncertainties, “Samsung will enhance the competitiveness of our main businesses and reinforce our value-added, differentiated products as a means to improve earnings.”
Overall, the third quarter is expected to be marginally positive as demand for consumer electronics goods, including smartphones and tablets, remains strong and a stream of new products hit the market. Supply for display panels is also expected to increase, as TV makers prepare for the year-end holiday season.