SEOUL • Samsung Electronics posted a 73 per cent jump in its fourth-quarter net profit yesterday, setting a record for any three-month period, mainly driven by demand for its memory chips and display panels.
Net profit for the October to December period hit 12.26 trillion won (S$15 billion), the South Korean tech giant said in a statement, on sales up 23.7 per cent to 65.98 trillion won.
Samsung Electronics, the flagship subsidiary of the Samsung Group, has had to overcome a recall of the Galaxy Note 7 device and the jailing of its vice-chairman Lee Jae Yong on corruption charges, but its financial performance has gone from strength to strength.
Its shares have more than doubled in the past two years on the back of its results, reaching levels of more than 2.5 million won apiece.
The firm announced a 50-for-1 stock split, sending the shares up 6.4 per cent in mid-morning trade, but they gave up most of the gains to heavy profit-taking to close just 0.2 per cent higher at 2,495,000 won.
"The stock split signals Samsung will stay on its course bolstering returns to shareholders," said Mr Cho Ik Jae at Hi Investment and Securities.
Operating profit came to 15.15 trillion won in the fourth quarter, up 64.3 per cent from a year earlier, Samsung Electronics said.
Fourth-quarter earnings were driven by the components business, with the largest contribution coming from the memory business that manufactures DRAM and NAND chips, the company said.
"Orders for high-performance memory products for servers and mobile storage were strong," it said, and the display panel business, which manufactures OLED and LCD screens, saw increased shipments of OLED panels for premium smartphones. But seasonal factors impacted growth for the System LSI and Foundry businesses, it said, and profitability for LCD panels.
Earnings in the mobile business also fell on the back of higher marketing costs. Operating profits were also undercut by approximately 660 billion won due to the won's appreciation against the dollar and other major currencies, it added.
For the full year, net profit was also a record at 42.19 trillion won, up 85.6 per cent on 2016, on sales of 239.58 trillion won.
It is paying out 5.8 trillion won in dividends to its shareholders this year, up 46 per cent year-on-year.
Looking ahead, the first quarter, despite being a traditionally slow season, is expected to show strong demand for memory products used in data centres, said Samsung Electronics.
AGENCE FRANCE-PRESSE