This photo, filed Oct. 26, 2022, shows Samsung SDI Co.’s headquarters in Giheung, about 40 kilometers south of Seoul.
SEOUL, April 27 (Korea Bizwire) — Samsung SDI Co. said Thursday its first-quarter net profit rose 28 percent from a year earlier as surging demand for electric vehicle (EV) batteries gave a boost to the bottom line.
Net income reached 464.5 billion won (US$347 million) in the January-March period, compared with 362.6 billion won the previous year, the South Korean battery maker said in a regulatory filing.
Operating profit came to 375.4 billion won for the three-month period, a 16.5 percent on-year increase from 322.3 billion won a year ago. Revenue jumped 32.2 percent on-year to 5.35 trillion won.
The earnings beat market expectations. The average estimate of net profit by analysts stood at 396.4 billion won, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.
The stronger bottom line came with the continued upward momentum in the automotive and energy storage system batteries segment, propelled by the releases of new EV models equipped with its signature P5 batteries, the battery maker said.
Samsung SDI mainly produces prismatic batteries in the higher end of the EV battery market. It supplies BMW A.G., Volkswagen A.G. and Ford Motor Co.
Samsung SDI said it is working on cobalt-free and lithium iron phosphate (LFP) batteries to target the low-to-mid-end EV market and the utility energy storage system (ESS) market to diversify its product lineups.
“The EV market has centered on the premium market so far, but we expect the volume and entry markets where more consumers can buy EVs, will grow rapidly due to the electrification trend led by global automakers,” Son Michael, senior vice president for the strategic marketing team said in an earnings call.
“We’re preparing the volume segment platform, such as cobalt-free based NMX (nickel manganese) and LFP, and they are under development using our proprietary technologies, with a goal for mass production,” Son said.
It will continue efforts to advance its premium lineup, with the next generation platform P6 aiming to be mass produced starting 2024, the company said.
The P6 aims to increase the nickel content to as much as 90 percent, which will improve the energy density by more than 10 percent compared with the preceding cells.
A visitor to Samsung SDI Co.’s exhibition booth at InterBattery 2021 in Seoul looks at an electric vehicle battery pack on June 9, 2021. (Yonhap)
The auto and energy battery segment booked 4.79 trillion won in revenue, up 44.6 percent from a year earlier. Operating profit grew 91.7 percent on-year to 316.3 billion won.
Its electronics components sector posted 557 billion won in revenue, down 23.7 percent from a year earlier, with operating profit sliding 62.4 percent to 59.1 billion won, due largely to lower demand in IT devices and seasonal factors.
Samsung SDI said it expects to continue solid growth in the second quarter, driven by burgeoning EV and ESS battery demand.
Samsung SDI announced earlier this week it is forming a joint venture with General Motors Co. to build an EV battery factory in the United States.
It will mark the second such facility in America after its first battery plant in Indiana, which is under construction in a joint venture with Stellantis N.V.
Shares in Samsung SDI rose 0.43 percent to 706,000 won on the main Seoul bourse Thursday, in line with the broader KOSPI’s 0.44 percent gain. The earnings results were released after the market opened.
(Yonhap)
