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Samsung sees strong Q2 earnings, shares jump

Mon Jul 6, 2009 10:25am IST
 
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By Rhee So-eui and Marie-France Han

SEOUL (Reuters) - South Korea's Samsung Electronics, the world's top maker of memory chips and flat screen TVs, forecast second-quarter earnings well above market estimates, driving its shares up more than 4 percent on Monday.

Technology companies around the world have seen their earnings and valuations hit by the global downturn, which has prompted consumers to cut back spending on electronics goods.

Analysts said the guidance reflected Samsung's strong market position and it was too soon to say the industry was on the mend.

"It looks like all key businesses -- semiconductors, LCD and mobile phones -- outperformed expectations," said Lee Min-hee, an analyst at Dongbu Securities.

"We've been expecting Samsung's earnings to show a V-shape recovery in the first half, and it looks like it's a much steeper recovery."

Samsung expects to post a consolidated operating profit for April-June of 2.2 trillion-2.6 trillion won ($1.74 billion-$2.05 billion) when it reports second-quarter earnings on July 24, it said in a filing to the Korea Exchange.

Samsung said it was the first time it had provided earnings guidance and was aimed at reducing confusion ahead of results, but it did not include a breakdown of divisional performance or other details.

"The guidance is very likely to translate into a parent-basis operating profit well above street forecasts of about 1 trillion won," said Dongbu's Lee.  Continued...

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