Samsung SDI Surpasses 4 Trillion Won in Q1 Sales... Battery and Electronic Materials Businesses Booming (Comprehensive)

Samsung SDI Surpasses 4 Trillion Won in Q1 Sales for the First Time... Car Batteries Prove to Be a Key Driver

[Asia Economy Reporter Oh Hyung-gil] Samsung SDI has surpassed 4 trillion won in sales for the first time on a quarterly basis despite global supply chain instability and rising raw material prices. Operating profit also reached a record high for the first quarter. Sales of medium-to-large batteries for electric vehicles and small cylindrical batteries for power tools drove the performance.

Samsung SDI announced on the 28th that its first-quarter sales reached 4.0494 trillion won, a 36.7% increase compared to the same period last year. Operating profit recorded 322.3 billion won, a 142.0% increase from last year. Both the energy division, centered on batteries, and the electronic materials division, including polarizing films, showed balanced growth, and the impact of rising raw material prices was minimized.

Kim Jong-sung, Vice Chairman of Samsung SDI, explained at the earnings conference, "The electric vehicle battery market is growing rapidly, and supply instability factors such as the Russia-Ukraine conflict have caused material prices to rise. However, since prices of materials like lithium and nickel are reflected in product prices, the impact on profitability is limited, and small batteries also link raw material prices to product prices."

Sales of automotive batteries increased mainly centered on the 'Gen.5' battery, which began mass production last year. Energy Storage Systems (ESS) saw a decline in sales due to the off-season, but the sales proportion of high-value-added products such as home-use and Uninterruptible Power Supplies (UPS) expanded. Sales of small cylindrical batteries increased, focusing on electric vehicles and high-power power tools, and pouch-type batteries saw sales growth by supplying new flagship smartphones.

In the electronic materials division, sales grew mainly through polarizing film products. Despite a decrease in demand for LCD TVs, sales and profitability increased due to the expansion of premium product proportions. Semiconductor materials maintained sales at the previous quarter's level, while OLED materials experienced a decline in sales due to seasonal off-season effects.

Samsung SDI expects sales of medium-to-large batteries to increase further in the second quarter. Following sales of Gen.5 batteries, they plan to actively pursue orders for the next-generation platform, the 'Gen.6' battery. ESS supply is also expected to expand, centered on power projects in the United States.

Sales growth of small batteries is also expected to continue, focusing on cylindrical batteries. Cylindrical batteries are expected to increase sales due to the launch of power tools using high-power batteries and the growing demand for electric vehicles and micro-mobility. Accordingly, expansions of the Cheonan plant and new lines in Malaysia are underway, and after expansion, cylindrical battery production capacity is expected to improve by 20% compared to the previous year. To respond to mid- to long-term demand, expansion of the second plant in Malaysia is also being pursued.

Regarding the joint venture with the automaker Stellantis, final negotiations are underway. Vice Chairman Kim said, "We are discussing detailed matters such as the selection of production bases for the joint venture and will complete the contract procedures soon, and as a long-term growth strategy, we are also discussing joint ventures with other automakers and carefully reviewing them."

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