October 08, 2015 11:44
The overweening power of Samsung in the Korean economy was felt clearly on Wednesday after an earnings surprise at the electronics giant caused the Korea Composite Stock Price Index to shoot over the key 2,000 point mark.
Samsung unveiled preliminary third-quarter earnings, which showed sales of W51 trillion and operating profit of W7.3 trillion (US$1=W1,159).
The results exceeded market expectations of W50 trillion and W6.6 trillion. Sales rose 5.1 percent from the second quarter and operating profit 5.8 percent.
Compared to the third quarter of 2014, when earnings were poor due to lackluster sales of the Galaxy S5 smartphone, sales were up 7.5 percent and operating profit skyrocketed 79.8 percent.
The last time Samsung's quarterly operating profit rose above W7 trillion was in the second quarter of last year. Samsung shares surged 8.69 percent and rose above the W1.2 million level for the first time in around a year.
Shares of LG Electronics, SK Hynix and other big electronics exporters also rose as analysts attributed Samsung’s sound earnings to foreign exchange rate effects.
The KOSPI closed at 2,005.84 points, above 2,000 points for the first time since Aug. 10.
As of the end of 2014, Samsung's sales account for 11.3 percent of the revenues of all listed companies in Korea, its operating profit for a staggering 27.4 percent and net profit for 38.3 percent. Its market capitalization alone accounts for 16.4 percent of the total.
Samsung admitted that external factors played a big role in its performance and warned its fourth-quarter earnings may not match the latest results.
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