Samsung Electronics Co., Ltd. announced its financial results for the first quarter of 2005. The company recorded sales of 13.8 trillion won (approx. U.S. $13.6 billion), a 0.6 percent decrease, operating income of 2.1 trillion won (approx. $2.1 billion) a 40 percent rise, and net income of 1.5 trillion won (approx. $1.5 billion), a drop of 18 percent from the previous quarter.
In addition, margins increased by 5 percentage points to 16 percent in the first quarter, but net income was impacted by the equity method loss incurred from the increase in reserves at Samsung Card. Sales and operating income of the semiconductor business decreased to 4.5 trillion won (approx. $4.4 billion) and 1.4 trillion won (approx. $1.4 billion), respectively, because of seasonal factors and currency exchange rates. With a record quarterly mobile phone shipment of 24.5 million units, the telecommunication network business recorded sales of 4.8 trillion won (approx. $4.7 billion), a 12 percent rise, and operating income of 840.5 billion won (approx. $827.6 million), an increase from the prior quarter. In addition, margins improved to 17 percent.
The LCD business reported revenue and operating income figures of 1.9 trillion won (approx. $1.9 billion) and 23.1 billion won (approx. $22.7 million), respectively. Digital media business sales decreased by 13.8 percent to 1.7 trillion won (approx. $1.7 billion) because of restructuring efforts that resulted in the termination or reduced emphasis of its low- to mid-end product lines. Sales of its digital appliance business increased 4.1 percent to 785.8 billion won (approx. $774 million) with the growth of sales of high-end home appliances and reservation sales of air-conditioners. The business reported an operating loss of 13.8 billion won (approx. $13.6 million).
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