Samsung raises its guidance

Natalie Apostolou
07 Jul 2009
00:00

Samsung Electronics has delivered an optimistic forecast to the market, suggesting that the electronic sector might be emerging from the economic slump.

The South Korea-based company is expecting consolidated sales of between 31 trillion won and 33 trillion won ($24.5 billion- $26.04 billion) for the second quarter, up from 29.1 trillion won the previous year.

The results represent a swift turnaround for the manufacturer, which suffered its first operating loss during Q4 of $680 million.

Samsung said in a trading update that it anticipated that that operating profit in the second quarter would have increased up to five times from the first quarter. It is scheduled to release its second-quarter results on July 24.

Analysts have attributed Samsung\'s strong performance to increased sales of its multimedia mobile handsets and high-margin LCD TVs.

Samsung\'s stock price rallied 4.7% on the news and Bank of America-Merrill Lynch shifted its recommendation from "underperform" to "buy," citing the company\'s earnings growth.

Goodmorning Shinhan Securities analyst Kim Gee-soo said, "the numbers came out stronger than the market had expected, and this is probably due to robust handset sales "&brkbar; provided that Samsung Electronics keeps up with this trend, its third-quarter earnings will come out even stronger, as its memory chip unit will do much better then."

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