Samsung SDI Surpasses 1 Trillion Won Operating Profit for the First Time Last Year... "5-10% Additional Dividend" (Comprehensive)

"Additional Dividend of 5-10% of Annual Free Cash Flow"

[Asia Economy Reporter Park Sun-mi] Samsung SDI has entered the '1 trillion won operating profit club' for the first time, thanks to the strong performance of its battery business. The company decided to pay an additional dividend of 5-10% of its annual free cash flow.

On the 27th, Samsung SDI announced that last year it recorded its highest-ever sales and operating profit with sales of 13.5532 trillion won and operating profit of 1.0676 trillion won. Surpassing 13 trillion won in sales and 1 trillion won in operating profit is a first since the company's founding. Sales increased by 20% and operating profit rose by 59% compared to the previous year. In the fourth quarter of last year, sales reached 3.816 trillion won and operating profit was 265.7 billion won, up 17.4% and 7.9% respectively from the same period last year.

By business division, energy and others recorded sales of 3.1073 trillion won, an 18.2% increase from the same period last year. Operating profit increased by 2.7% to 120.2 billion won. Medium and large batteries saw sales growth and maintained profitability. Automotive batteries increased sales centered on the Gen5 battery despite semiconductor supply issues for vehicles. Energy Storage Systems (ESS) improved sales and profitability as sales of high value-added products such as home-use and Uninterruptible Power Supply (UPS) expanded.

For small batteries, sales grew both quarter-on-quarter and year-on-year. Cylindrical batteries increased sales mainly for electric vehicles and power tools, but pouch batteries saw a decline in sales of flagship smartphone products due to seasonal off-season effects.

Sales and operating profit of electronic materials were 708.7 billion won and 145.5 billion won respectively, up 13.9% and 12.6% from the same period last year. Sales increased centered on high value-added display materials, maintaining high profitability. Polarizing films saw increased sales due to higher sales for large TVs, and OLED materials increased sales with expanded supply for smartphones and TVs. However, semiconductor materials sales slightly decreased due to inventory adjustments by customers.

Samsung SDI expects market growth across all battery sectors this year, including automotive batteries, ESS, and small batteries. In particular, in the first quarter, automotive battery sales are expected to continue expanding mainly with batteries installed in new models of major customers, and ESS sales are expected to increase centered on high value-added products, improving profitability. Small batteries are expected to be influenced by increased sales of cylindrical batteries for electric vehicles and new flagship smartphone pouch batteries.

Despite seasonal off-season effects, electronic materials are expected to see increased demand centered on high value-added materials, enabling profitability improvement. Display materials are expected to maintain sales centered on polarizing films, and the company announced plans to strengthen technological competitiveness focusing on premium products.

Meanwhile, Samsung SDI decided on a dividend of 1,000 won per common share (1,050 won per preferred share) for 2021. It also disclosed a new shareholder return policy to be applied from 2022 to 2024. Under the new policy, Samsung SDI will set the basic dividend at 1,000 won (1,050 won for preferred shares) and pay an additional dividend of 5% to 10% of annual free cash flow. The company plans to maintain minimum shareholder returns through the basic dividend while enhancing shareholder value by adding additional dividends.

Kim Jong-sung, Vice President and Head of Management Support Office at Samsung SDI, said, "We have newly presented a shareholder return policy to increase predictability regarding shareholder returns," adding, "We will continue to do our best to enhance company and shareholder value by actively promoting sustainable management including ESG."

This content was produced with the assistance of AI translation services.