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2018 3Q Earnings Release

2018-10-31
2018 3Q Earnings Release

Revenue: 2.3663 trillion won, Operating profit: 405.0 billion won
- Revenue and operating profit have increased by 31 % and 96 % respectively in comparison with the previous quarter (Q2, 2018).
- Revenue and operating profit have increased by 29 % and 293 % respectively in comparison with the same quarter last year (Q3, 2017).
- Record quarterly operating profits due to the increase in parts shipments resulting from the increase in MLCC sales and new model releases
- This growth trend is expected to continue due to the increase in mid/long-term demand for MLCCs such as high-end IT MLCCs and industrial/automotive MLCCs.

Samsung Electro-Mechanics announced on the 31st that it had recorded 2.3663 trillion won in revenue and 405.0 billion won in operating profit on a consolidated basis in the third quarter of this year. Revenue increased by 556.5 billion won (31 %) and 525.2 billion won (29 %) when compared with the previous quarter and the same quarter of the last year, respectively, while operating profit increased by 198.1 billion won (96 %) and 301.8 billion won (292 %) when compared with the previous quarter and the same quarter of the last year, respectively.


Samsung Electro-Mechanics explained that the revenue and operating profits of all business units improved as sales of high-end MLCCs (Multi-Layer Ceramic Capacitor) greatly increased and shipments of major components such as modules and substrates increased due to the release of new product models by our major customers.
Though revenue is expected to fluctuate in the fourth quarter due to seasonal factors, MLCC is expected to continue its growth trend as a result of the increase in the demand for high-end IT and industrial/automotive electronic products.


※ Q3 Business Results and Future Strategies by Business Unit

Component Solution Business Unit revenue in the third quarter was 1.268 trillion won; compared with the previous quarter and the same quarter of last year, this represents an increase of 158.2 billion won (18 %) and 418.8 billion won (69 %), respectively. Miniature/ultra-high-capacitance MLCC shipments for the new product models of overseas customers have increased as a result of customer diversification, and industrial/automotive MLCC sales have also increased greatly when compared with the previous quarter as a result of customer diversification.
As demand in the MLCC market is expected to increase greatly in the fourth quarter, centered on high-end IT MLCCs and MLCC for industrial/automotive electronics, revenue growth is also expected to continue.


Module Solution Business Unit revenue in the third quarter was 885.1 billion won; compared with the previous quarter and the same quarter of the last year, this represents an increase of 273.2 billion won (45 %) and 63.1 billion won (8 %), respectively.
Revenues grew greatly as cameras and communication module shipments increased thanks to the release of new flagship products by our strategic customers, and sales of dual cameras with OIS (Optical Image Stabilization) to major Chinese customers increased.
Going forward, Samsung Electro-Mechanics plans to aggressively respond to the increase in demand for multi camera modules such as triple and quadruple cameras and next-generation communication modules such as 5G communications modules.


Substrate Solution business unit revenue in the third quarter was 432.4 billion won; compared with the previous quarter and the same quarter of the last year, this represents an increase of 132.9 billion won (44 %) and 32.8 billion won (8 %), respectively.
Shipments of RFPCB (Rigid Flex Printed Circuit Board) for OLEDs and SLP (Substrate Like PCB), the main substrate for the next-generation smartphone, increased; package substrate sales also increased greatly as a result of the increase in the demand for PCs. RFPCB demand is expected to grow steadily going forward due to the increase in OLED usage; the use of high-end package substrates in automotive electronics/network devices is also expected to increase.



※ Quarterly Results

[Unit: KRW 100 million]

Category 2018 QoQ(%) 2017 YoY(%)
3Q 2Q 3Q
Revenue 23,663 18,098 30.8 18,411 28.5
Operating Profit 4,050 2,068 95.8 1,032 292.5
Earnings Before Tax 3,687 1,817 102.9 985 274.2
Net Profit 2,377 1,220 94.9 719 230.8

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