South Korea's Samsung Elec-tronics yesterday posted weaker-than-expected results for the third quarter as low product prices, coupled with higher promotion costs, undermined its bottom line.
The world's largest maker of computer memory chips and liquid crystal display (LCD) panels said net profit for the three months to September fell to 2.69 trillion won (US$2.35 billion) from 3.13 trillion won in the second quarter. The third-quarter net profit, although up 46 percent year-on-year, missed general market expectations of some three trillion won.
Sales in the July-September period stood at 14.34 trillion won, up 27 percent year-on-year, while operating profit was 2.74 trillion, up 34 percent.
Compared with the previous quarter, however, net profit fell 14 percent, sales were down 4.0 percent and operating profit declined by 27 percent.
The disappointing data sent the company's shares sliding 1.6 percent to close at 437,000 won.
They had recovered briefly on Samsung Electronics' positive guidance for the coming months but the upturn was short-lived as declines overnight on Wall Street, record oil prices and concerns over potential earnings shocks next week combined to know investor confidence, dealers said.
"In the three quarters, the company has already outperformed the sales reported during all of 2003 and the semiconductor business managed to produce record quarterly sales," said Chu Woosik, senior vice president and general manager for investor relations.
"The performance thus far speaks to the high competitiveness of the company's diversified operations. Even as market conditions are expected to worsen, we will continue to expand our distinctive competitiveness to maintain our strong financial structure," he said.
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