Samsung Electronics Announces 2005 Third-Quarter Earnings Record Number of Handset Sales in the Third Quarter

(Auszug aus der Pressemitteilung)

SEOUL, Korea – October 14, 2005 – Samsung Electronics Co., Ltd.

announced its financial results for the third quarter of 2005. The
company recorded net income of 1.88 trillion won, on sales 14.54
trillion won. Operating income was 2.13 trillion won, or up 28.8% from
the previous quarter. Net profit in the third-quarter increased 11%
compared with the previous quarter, while sales jumped 7% compared to
the previous quarter.
Solid sales of semiconductors, LCD, and mobile phones were key factors
that helped Samsung register strong revenue in spite of the difficult
business climate caused by rising global oil prices. Operating profit
surged 29% in the third quarter from the previous quarter on the back of
increased sales of NAND Flash chips, strong demand of LCDs, and
increased sales of mobile phones in Europe and North America.

The growth rate in net profit in the third-quarter was less than that of
operating profit due to provisions set aside to cover costs related to
the U.S-government investigation into the price-fixing of memory chips.
Due to the provisions, equity-related gains decreased in the third

Sales and net income of the Semiconductor Business increased to 4.59
trillion won and 1.35 trillion won, respectively, as demand for NAND
Flash chips used in MP3 players and mobile phones remained robust.
Migration to the finer process technology in both DRAM and NAND Flash
helped reduce manufacturing costs and boost profitability.
Samsung produces DRAM chips on 80nm and 90nm processes, and the company finished developing a 512Mbit DDR2 memory device on a 70nm process. Yields per wafer will be 100% higher than using 90nm technology.

The Telecommunication Network Business posted sales of 4.58 trillion
won, and operating income of 550 billion won. Samsung sold a record 26.8
million phones in the third quarter. Globally, the handset market is
increasing becoming more competitive as companies produce more
mid-to-low-end handsets. Meanwhile, Samsung continues to be a market
leader in the high-end, premium handset sector.

Demand for Blue-Black phones, which were launched November 2004,
remained robust in the third quarter. The company expects stronger ASPs
in the fourth quarter with the launch of new premium products such as
the D600 and 3G phones. The LCD Business reported revenue and operating
income figures of 2.68 trillion won and 300 billion won, respectively.
The company expects its performance to improve in the fourth quarter as
demand for LCDs increases, especially of sales of 32-inch and larger LCD
TV panels.

Digital Media Business sales decreased to 1.64 trillion won and posted a
20 billion won operating loss. Sales of its Digital Appliance Business
dropped 15% to 850 billion won and operating income at 40 billion won.
Dr. Woosik Chu, Senior Vice President of Samsung’s investor-relations
team, said „Despite the challenging business environment and depressed
market conditions, sales of our mainstay products remained robust,
demonstrating the inherent strength and competitiveness of Samsung’s
business model.“ Dr. Chu adds, „Samsung Electronics anticipates
positive fourth-quarter results as demand for IT products tend to surge
in the year end.“