A Big Q2 Turnaround

Samsung Electro-Mechanics improves Q2 results y-o-y

Samsung Electro-Mechanic Co. said its second quarter consolidated financial statement showed that its revenue amounted to 750.2 billion won and operating profit 25.7 billion won, which is a turnaround from the same period last year, the Samsung affiliate said recently. Compared to the previous quarter, revenue is down 2.9 percent, while operating profit is up 16.8 percent from the same period last year showing 12.7 billion won in loss. The operating profit has satisfied the expectations by securities firms, which amounted to 24.5 billion won.
The company said its satisfactory Q2 record has been owed to the competitive strength of its three major products including camera module, despite the strong won, high raw material prices and the business trend for IT products. But the company is still in the red based on Samsung Group's accounting standards. The company's loss in the Q2 amounted to 4.1 billion won, following the Q1 loss of 5.4 billion won, which, however,
shows reduction from the Q2 loss last year amounting to 14.7 billion won.
The company has a superb prospect for the growth of its shares. An analyst at Hyundai Securities said its shares are attractive since the company has an excellent chance for take-off in the second half with the share price staying at the lowest level, where they began to recover in the past. Samsung Securities also has made a prediction that the company's shares have a good chance to double its PBR when the stock market begins to rise in the second half, saying that its prediction is based on the fact that its estimated PBR is 1.5 times, lower than the company's share price average in the past 5 years.
Hyundai Securities and Samsung Securities project the company's share price would hit around 46,000 won per share in the second half.
But there are views that the company's loss according to the Samsung Group accounting standard and below market expectations would not help the shares to climb back up. Securities firms expected Samsung Electro-Mechanic would make from 2 to 3 billion won in operating profit in the Q2. nw

President Kang Ho-moon with a paper hat on serves food to a local resident during the community service hosted by his company.

President Kang Ho-moon of Samsung Electro-Mechanics Co.


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