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Samsung posts impressive first-quarter profit


Samsung Electronics Co Ltd on Thursday flagged stronger earnings and announced a cancellation of treasury shares after posting a solid first-quarter profit boosted by the memory chip business, sending its shares to a new high.

Samsung Electronics Co Ltd on Thursday flagged stronger earnings and announced a cancellation of treasury shares after posting a solid first-quarter profit boosted by the memory chip business, sending its shares to a new high.

Samsung rejected a call from U.S. activist hedge fund Elliott to split itself in two but accepted part of the fund’s proposals on Thursday, revealing plans to cancel its existing treasury shares worth over $35 billion by 2018.

Samsung rejected a call from U.S. activist hedge fund Elliott to split itself in two but accepted part of the fund’s proposals on Thursday, revealing plans to cancel its existing treasury shares worth over $35 billion by 2018.

While the first quarter was a torrid time for Samsung as chief Jay Y. Lee was swept up in a political corruption scandal, the world’s top maker of memory chips, smartphones and televisions still managed to book a profit that supports expectations for record earnings in 2017.

While the first quarter was a torrid time for Samsung as chief Jay Y. Lee was swept up in a political corruption scandal, the world’s top maker of memory chips, smartphones and televisions still managed to book a profit that supports expectations for record earnings in 2017.

First-quarter operating profit for Asia’s most valuable company by market capitalization was 9.9 trillion won ($8.75 billion), matching Samsung’s earlier guidance. Revenue rose 2 percent to 50.5 trillion won.

First-quarter operating profit for Asia’s most valuable company by market capitalization was 9.9 trillion won ($8.75 billion), matching Samsung’s earlier guidance. Revenue rose 2 percent to 50.5 trillion won.

Elliott welcomed the share cancellation and said it saw “room for even more progress”. The fund had called for Samsung to adopt a holding company structure by splitting itself in two, and to pay out a 30 trillion won a special dividend.

Elliott welcomed the share cancellation and said it saw “room for even more progress”. The fund had called for Samsung to adopt a holding company structure by splitting itself in two, and to pay out a 30 trillion won a special dividend.

“We are encouraged that Samsung Electronics has agreed to take the bold step of optimizing its balance sheet … even as the company has faced obstacles,” Elliot said in a statement.

“We are encouraged that Samsung Electronics has agreed to take the bold step of optimizing its balance sheet … even as the company has faced obstacles,” Elliot said in a statement.

Samsung Electronics shares were up 2.6 percent at a record high in a flat wider market.

Samsung Electronics shares were up 2.6 percent at a record high in a flat wider market.

In rejecting Elliott’s call for a holding company structure, Samsung cited issues including regulatory and legal risks, and said it would not boost investor returns.

In rejecting Elliott’s call for a holding company structure, Samsung cited issues including regulatory and legal risks, and said it would not boost investor returns.

“Samsung concluded the risks and the challenging environment surrounding a change in the corporate structure would not be beneficial for enhancing shareholder value and sustaining long-term business growth,” it said in a statement.

“Samsung concluded the risks and the challenging environment surrounding a change in the corporate structure would not be beneficial for enhancing shareholder value and sustaining long-term business growth,” it said in a statement.

CHIPS SIZZLE

CHIPS SIZZLE

A memory chip super-cycle and the revival of the mobile business – damaged by the costly failure and fire-prone Galaxy Note 7 last year – look set to underpin Samsung’s profitability after the best quarterly result since 2013.

A memory chip super-cycle and the revival of the mobile business – damaged by the costly failure and fire-prone Galaxy Note 7 last year – look set to underpin Samsung’s profitability after the best quarterly result since 2013.

“Looking ahead to the second quarter, the company expects to achieve growth on the back of continued robust memory performance together with improved earnings from the mobile business” following the global rollout of the new Galaxy S8 smartphone, Samsung said in a statement.

“Looking ahead to the second quarter, the company expects to achieve growth on the back of continued robust memory performance together with improved earnings from the mobile business” following the global rollout of the new Galaxy S8 smartphone, Samsung said in a statement.

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