Samsung depends heavily on tech arm in operating profit

By 정주원
  • Published : Feb 4, 2014 - 11:02
  • Updated : Feb 4, 2014 - 11:02

Samsung Group, South Korea's No. 1 conglomerate, is growing more dependent on its electronics arm for its operating profit, latest market data showed Tuesday.

Samsung Electronics Co., the flagship unit of the business group, provided 92.3 percent of the combined operating profit by the conglomerates' 17 listed affiliates in 2013, according to market researcher FnGuide.

Samsung Electronics accounted for around 60 percent of the group's yearly operating profit in 2007-10. The number spiked to 79 percent in 2012, with the rising popularity of its smartphone lineup around the globe.

The group's other affiliates posted far weaker earnings in 2013 amid prolonged slump in the global economy, with only three other arms -- Samsung Electro-Mechanics Co., Cheil Worldwide Inc. and Credu Co. -- logging on-year increase in operating profits.

Samsung's No. 2 player Samsung Heavy Industries Co. contributed 2.3 percent to the combined operating profit, a whopping drop from the 7 percent in 2008. Samsung Fire & Marine Insurance Co. accounted for 1.7 percent last year, down 6.3 percentage points over the cited period.

Industry watchers point out that such profit structure makes the business group more sensitive and susceptible to any lags in global smartphone business and may become a drag on affiliates' listed shares.

Samsung Electronics closed at 1,272,000 won ($1,169) on the main bourse Monday, continuing on a downward path after falling below the psychologically significant level of 1,500,000 won in November last year. The share reached its peak on Jan. 3, 2013 at 1,584,000 won.

Shares of other Samsung clan have been losing ground on the main bourse this year, with those of Samsung Securities Co., Samsung Fine Chemicals Co., Samsung Card Co., Samsung Techwin Co., Samsung Electro-Mechanics and Cheil Industries falling to 52-week-low this month. (Yonhap News)