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Samsung SDI Announces Third Quarter 2022 Results Posts record quarterly revenue, operating profit

Samsung SDI Announces Third Quarter 2022 Results

Posts record quarterly revenue, operating profit

□ [Q3] Quarterly revenue of KRW 5.37 trillion, operating profit at KRW 565.9 billion

- Energy businesses post 10% in operating margin

- Accumulated earnings as of Q3 surpass 2021 figure 

□ [Q4] Electric vehicle battery sales to rise upon launches of new vehicles and seasonal demand hike



□ Third quarter earnings results 

Samsung SDI today reported financial results for the third quarter that ended September 30, 2022. 


The Company posted a record revenue of KRW 5.37 trillion and operating profit of KRW 565.9 billion. While both quarterly revenue and operating profit reported historical highs, it was the first time for the Company to exceed the 5 trillion mark in revenue and 500 billion in operating profit for a quarter. In addition, the Company’s Energy Business recorded a double-digit figure in operating margin.   


From a year earlier, the quarterly revenue and operating profit grew by KRW 1.93 trillion (56.1%) and KRW 192.4 billion (51.5%), respectively. From a quarter earlier, the revenue expanded by KRW 627.2 billion (13.2%), and the operating profit by KRW 136.9 billion (31.9%). 


As a result, Samsung SDI achieved a feat of surpassing the previous year’s record in accumulated earnings as of the third quarter. Such result is attributable to the Company’s qualitative growth strategy that prioritizes profitability, despite rises in raw material prices amid the global economic downturn and inflation. 


□ Third quarter earnings results by Business 

The Company’s energy businesses posted KRW 4.83 trillion in the revenue, up by 76.4% year-on-year and by 18.7% quarter-on-quarter. The operating profit it produced was KRW 484.8 billion, which is up 140.2% from a year earlier and 98.0% from the second quarter, with the operating margin at 10.0%. 


Huge improvement in the results of the Large-Sized Lithium-Ion Battery (LIB) Business stood out compared to the previous quarter. The Automotive Battery Business recorded an increased revenue and higher profitability by expanding the sales of high-value products such as P5 (Gen.5) amid solid demand for high-end electric vehicles. The ESS Business saw improved profitability as ASP was indexed with the price escalation of raw materials and the sales grew in Europe. 


As for the Small-Sized LIB Business, the increased revenue was pushed by high-value products which resulted in improved profitability. Revenue growth of cylindrical batteries for electric vehicles (EV) applications and high-voltage power tools was the driver for the improved results.  


The Electronic Materials (EM) Business saw a decline in both sales and profits compared to the previous quarter due to low end-product demand. The revenue posted was KRW 534 billion, a year-on-year 23.6% and a quarter-on-quarter 20.2% decrease, respectively. The operating profit was KRW 81.1 billion, down by 52.8% from the same time last year and by 55.9% from the second quarter this year.


Amid the difficult market situation with low end-product (i.e. TVs) demand that led to the lower revenue in polarizers, the EM Business maintained sound profitability secured by the initiation of OLED materials supply for new platforms and the revenue increase in semiconductor materials.


□ Business outlook for the fourth quarter

Samsung SDI expects to continue its growth into the fourth quarter. 


The Large-Sized LIB Business is expected to expand its sales as the fourth quarter usually embraces the strong market demand. 


The Automotive Battery Business is forecasting a sales increase driven by launch of new vehicle models with P5 (Gen.5) built in as well as by such seasonal demand hike. The efforts to win projects for the next generation platforms – P6 (Gen. 6) and 46Φ batteries – will continue in the coming months. The sales of the ESS Business is expected to be higher with the expansion of utility sales in the US. 


The Small-Sized LIB Business expects its sales to go up, propelled by sales expanding in cylindrical batteries for EV applications. Seeking long-term supply agreements for cylindrical batteries for power tools will play a role in minimizing the impact of slowing demand whereas new product application casts a positive outlook for pouch batteries for IT devices.


In the fourth quarter, the EM Business is looking forward to expanding the sales focused on display materials. The sales of OLED materials is likely to grow with mass production initiated for new platforms and a similar scenario goes for semiconductor materials with solid sales thanks to major customers’ capacity ramp-ups. As for polarizers, the EM Business expects both the sales and profitability to improve quarter-over-quarter as there are multiple factors playing for the business such as launch of new TV models next year, development of high-value products, and potential supply of polarizers for OLED displays, as well as its ongoing strategy of diversifying its customer portfolio.


□ ESG management activities 

Samsung SDI is proactively engaged in ESG management activities. 


In September, the Company joined the RE100 initiative, a global voluntary initiative to replenish 100 percent of corporate electricity consumption with renewable energy by 2050. In early October, the Company declared environment-friendly management in a public announcement. It announced a package of strategies, including eight specific tasks under two themes - response to climate change and resource circularity. 


As part of the efforts, the Company has decided to increase recovery of key resources, such as cobalt, nickel and lithium, through battery recycling, while replacing all of its corporate vehicles to zero-emission cars.  


Besides the eight tasks, the Company will continue to discover and execute new projects to fulfill its ESG goals. 


“The Company once again recorded the largest-ever earnings amid the persisting concerns over rising raw materials prices and languishing demand, thanks to the efforts made by Samsung SDI’s employees and executives,” said President and CEO YOONHO CHOI. “To realize the vision of becoming a Global Top Tier Company by 2030, the Company will accelerate efforts to achieve ‘super-gap technology competitiveness,’ ‘best quality,’ and ‘profitable qualitative growth’ and fulfill corporate social responsibilities through eco-friendly management at the same time.”