Samsung Electronics announces stock split, after posting record earnings

By Jennie Oh  |  Jan. 31, 2018 at 3:42 AM
share with facebook
share with twitter

SEOUL, South Korea, Jan. 31 (UPI) -- Samsung Electronics has announced its first-ever stock split aimed to enhance shareholder value, after the company recorded the biggest quarterly earnings seen in its 49-year history.

The South Korean tech giant said Wednesday that its board of directors approved a 50-to-1 stock split, in a bid to increase liquidity and marketability of the company's shares.

Under the plan, the number of outstanding shares would increase from 128.4 million to 6.42 billion with the face value of a stock adjusted downward from 5,000 won ($4.70) to 100 won ($0.09).

The decision is set to be finalized on March 23 at a regular shareholders' meeting.

The announcement came as the electronics giant reported record earnings for the fourth quarter of 2017.

Samsung's operating profit in the October-to-December period jumped 64 percent year-on-year, to reach a record 15.15 trillion won ($14.19 billion).

Total sales in the fourth quarter came to 65.98 trillion won ($61.83 billion), up 24 percent on-year.

The sharp growth was driven by strong returns from its chip business, which accounts for three quarters of the operating profit, at 10.9 trillion won ($10.2 billion).

The company also attributed its gains to increased sales of flexible OLED panels, reporting a 1.4 trillion ($1.3 billion) profit in its display division, up 5 percent from a year earlier.

However, the firm's mobile communication sector saw its margin drop from the third quarter, due to low seasonal demand for handsets and increased marketing costs.

Samsung's total sales for 2017 came to 239.58 trillion won ($224.5 billion) while operating profit reached 53.7 trillion won ($50.2 billion), both record highs for the company.

The company expects sales figures to remain strong for the time being, as the global appetite for semiconductors continue to grow and the launch of Samsung's flagship Galaxy S9 is likely to be reflected in its first quarter earnings.

Samsung Electronics shares closed 0.2 percent up on Wednesday, at 2,495,000 won ($2,339), after briefly jumping more than eight percent upon the announcement of the stock split decision.

Related UPI Stories
Trending Stories