FINANCIAL ROUNDUP: Samsung Operating Profit Up, Net Profit Down
SEOUL — Samsung Electronics posted a near-40% fall in first-quarter net profit Wednesday, missing analyst estimates despite a surge in memory chip demand that cushioned a slump in smartphone sales.
Facing increasing competition from arch rival Apple and smaller Chinese manufacturers, the world's top handset maker reported a net profit of 4.6 trillion won, about $4.3 billion, for the January-March period, down 38.9% from a year earlier. It was the fourth straight quarterly decline in net profit.
Operating profit also fell 29.6% on-year to 6.0 trillion won, largely in line with the firm's earlier forecast. But in a sign that the South Korean electronics giant might be turning a corner, the operating profit was up 13.1% from the fourth quarter of last year.
VOLKSWAGEN: FRANKFURT, Germany — Volkswagen said Wednesday that business got off to a good start in the first three months of this year, thanks to higher demand and the falling euro.
VW said in a statement that its net profit jumped by 20.6% to 2.887 billion euros, about $3.2 billion, in the period from January through March.
Underlying or operating profit grew by 16.6% to 3.328 billion euros, about $3.7 billion, on a 10.3 percent increase in revenues to 52.735 billion euros, or $58.3 billion, the statement said. Customer deliveries increased by 1.8% to 2.487 million vehicles worldwide.
ABB: ZURICH, Switzerland — Engineering giant ABB reported better-than-expected first-quarter profits despite a stronger U.S. dollar, which negatively impacted revenues.
Net profits rose 4% to $564 million, the group said in a statement, adding that big orders had doubled. It also reported strong growth in three key markets -- the United States, China and Germany. Analysts polled by the Swiss financial news agency AWP had forecast net profits of $544 million and sales of $8.3 billion.
Revenues however fell 10% to $8.5 billion, due to the negative exchange impact of a stronger dollar in the first quarter. Total orders were flat in dollar terms, but grew 15% on a like-for-like basis. Orders of over $15 million doubled, the group said, and represented 23% of total activity compared with 12% in the same quarter a year ago.
ABB recently won a $900 million order to connect the Norwegian and German power grids.
LG: SEOUL — LG Electronics reported a 58.5% slump in first-quarter net profit on Wednesday, as losses caused by currency swings in overseas markets offset profits from its record smartphone sales.
Net profit for January-March was 38.4 billion won, about $35.9 million, the company said in a statement. Operating profit dropped 36.2% year-on-year to 305.2 billion won, about $285 million, while sales remained unchanged at 14 trillion won, close to $13.1 billion.
The firm's TV unit posted an operating loss of 620 million won, about $580,000 in the first quarter, a big turnaround from an operating profit of 216.1 billion, or $201.9 million a year earlier. LG's mobile unit however recorded an operating profit of 72.9 billion won, $68.1 million, from a loss of 730 million won, or $682,000, a year earlier, thanks to solid sales of its popular flagship smartphone G3.
