Strong full-year results for Samsung and LG

Samsung has reported solid fourth-quarter and end-of-year results, despite the massive safety recall of its Note 7 phones.

In Q4, the company reported 53.33 trillion won (£36.4 billion) in consolidated revenue and an operating profit of 9.22tn won. It ended the full year with revenues of 201.87tn won, which earned it profits of 29.24tn won.

It said fourth-quarter earnings were driven by its components businesses, mainly the memory business and the display panel segment, which manufactures OLED and LCD screens.

Semiconductors also did well for Samsung, with Q4 sales worth 14.86tn won bringing profits of 4.95tn won.

Earnings declined, however, in its consumer electronics division despite increased sales of premium TVs, including SUHD and curved TVs. It saw sales of 13.64tn won and profits of 32 billion won.

In its home appliances business, Samsung experienced positive demand in Q4, but new investments in B2B resulted in a slip in earnings.

Moving into the first quarter of 2017, Samsung said it expected overall earnings to decline as a result of increased marketing expenses in the mobile business and a decrease in sales of TVs, thanks to weak seasonal demand.

Meanwhile, rival LG Electronics also saw revenues increase in the fourth quarter to 14.78tn won – 11.7 per cent higher than the previous quarter and 1.5 per cent higher than Q4 in 2015. However, because of losses in its mobile communications and vehicle components divisions, it made a Q4 net loss of 258.8 billion won.

For the full year, revenue was 55.37tn won with an operating profit of 1.34tn won – a 12.2 per cent increase on 2015. This was driven by strong performances from its home appliances and home entertainment divisions.

The company said that the operating profit for its Home Entertainment division was the highest in its history.