Monday, January 11, 2010

Samsung Revenues and Profits Soar

Korea's top conglomerates did well last year. I've noted in my commentaries and posting that they looked at the global recession as a opportunity to gain market share and leap frog past their competitors---many long established. Along with aggressive marketing and drive for sales, they cut costs, eliminated jobs, and scrutinized spending. One key factor which will influence 2010 profits will be a strengthening Won.

Chosun Ilbo reported... (btw US$1=W1,135 or think that Korean trillions equal US billions, Korean billions equal US millions, etc.)

Forty years since its founding Samsung Electronics has set an unprecedented record in Korean business history.

The electronics giant on Thursday [Jan 7, 2010] released estimates of its revenue and profit for the fourth quarter of last year. Preliminary revenue stood at a record W39 trillion while operating profit posted W3.7 trillion .

Overall Samsung reaped W136 trillion in revenue and W11 trillion in profit in 2009, becoming the first Korean company to surpass the W100 trillion revenue and W10 trillion profit threshold in the same year.

Samsung says its accomplishments are especially valuable as they were hard earned. The company did not escape the impact of the global financial turmoil in late 2008. In the fourth quarter of that year it posted a deficit of W740 billion for the first time since record taking began in 2000.

Since the beginning of 2009 the company has been running under an austerity management system. Paychecks of Samsung's board members have been cut by 20 percent while employees going on overseas business trips take cheaper flights. To raise efficiency more office workers are sent out to work on-site.

The hardships are paying off. The price of semiconductors rose amid improving global economic indicators while some major competitors closed down, hit hard by the financial meltdown. Backed by unexpectedly robust sales in the LED television sector Samsung once again secured its position as a global corporation in 2009.

Samsung says with an improved business environment and bright prospects in the semiconductor and LED TV sectors it is confident to do even better this year.

1 comment:

  1. BTW
    Korean won breaches 1,120 won level to dollar

    SEOUL, Jan. 11 (Yonnhap) -- The South Korean currency rose to the strongest level against the U.S. dollar in nearly 16 months on Monday as offshore investors dumped the greenback in expectation of the won's further ascent, dealers said.

    The local currency closed at 1,119.80 won to the greenback, up 0.96 percent or 10.7 won from the previous session, marking the strongest level since Sept. 17, 2008.

    "Amid the global weakness of the dollar, the won's sharp gain came as offshore investors were betting on additional gains by the won," said Byeon Ji-young, a currency analyst at Woori Futures Co.

    During the session, the Korean unit climbed to an intra-day high of 1,117.50 won in late trading. After the finance ministry made a verbal intervention by saying that foreign exchange authorities would take action when needed as the dollar sale by offshore investors is seen as excessive.

    The dollar weakness continued as job data in the U.S. was worse-than-expected, raising concerns that the recovery of the world's largest economy may be slow.

    The Korean currency has sharply risen to the dollar since the start of the new year with its value climbing about 4 percent during six sessions alone.

    The Korean won tumbled 25.7 percent to the greenback in 2008 alone, hit by the U.S.-sparked global financial turmoil. But as the financial crisis subdued and the Korean economy is recovering at a faster pace, the won gained 8.16 percent versus the dollar last year.

    The Korean economy grew 3.2 percent in the third quarter from three months earlier on improving domestic demand and robust exports. The country's current account has been in the black since February, putting upward pressure on the local currency.

    Experts say that given strong economic fundamentals, the local currency is likely to be under upward pressure to the dollar.

    "In the mid-and long term, the won's rise seems to be inevitable, but the pace of its gain could be limited due to caution against intervention," Byeon said.