20151126-三星证券-Samsung_Earnings_Monitor__3Q_report_card_21页_1mb

Summary of Samsung Earnings Monitor Report (3Q 2015)

Core Content

This document provides a detailed analysis of the financial performance and forecasts for the Samsung Universe and the broader MSCI Korea index for the third quarter (3Q) of 2015 and the full year (FY) projections. It includes earnings data, profit growth expectations, valuation metrics, and changes in forecasts over time.

Main Points

Earnings Overview (3Q 2015)

• Samsung Universe reported:

  • Operating profit: KRW106t, up 15% y-y.
  • Net profit: KRW87t, up 23% y-y.

• Kospi 200 firms reported:

  • Operating profit: KRW29t, up 20% y-y.
  • Net profit: KRW30t, up 62% y-y.

• Key Drivers:

  • Strong performance in IT hardware (Samsung Electronics), utilities (Kepco), and chemical and energy sectors.
  • Kepco's significant contribution to net profit due to the sale of its headquarters.
  • Net profit exceeded consensus by KRW1.9t, while operating profit fell short by KRW10t.

• Sector Performance:

  • Utilities: Net profit rose to KRW9.1t, up 47.6% y-y.
  • Industrials: Net profit turned negative, indicating a significant drop.
  • Consumer Discretionary: Net profit increased by 21.0% y-y.
  • Healthcare: Net profit increased by 22.9% y-y.
  • Financials: Net profit increased by 9.9% y-y.

4Q 2015 Forecasts

• MSCI Korea:
  • Operating profit: KRW28t, up 28% y-y.
  • Net profit: KRW22t, up 59% y-y.
  • This growth is attributed to a low base following big-bath accounting in 4Q14.

Valuation Metrics

• Samsung Universe:

  • Forward P/E: 10.9x.
  • Forward P/B: 0.98x.

• MSCI Korea:

  • Forward P/E: 10.8x.
  • Forward P/B: 0.96x.

• Kospi Valuations:

  • Current forward P/E: 10.9x.
  • Forward P/B: 0.98x.
  • Historical trends show that forward P/E and P/B have fluctuated around these values, with P/E ranging from 8.1x to 14.6x and P/B from 0.77x to 1.80x.

Key Information

Full-Year Forecasts (2015)

• Samsung Universe:

  • Operating profit: KRW106t, up 14.7% y-y.
  • Net profit: KRW87t, up 22.9% y-y.

• Excluding Samsung Electronics (SEC):

  • Operating profit: KRW79t, up 16.6% y-y.
  • Net profit: KRW63.8t, up 34.5% y-y.

Forecast Changes

• Samsung Universe:

  • Operating profit forecasts: Increased slightly in 2015 and 2016.
  • Net profit forecasts: Showed significant growth in 2015, but are expected to slow in 2016.

• MSCI Korea:

  • Operating profit forecasts: Showed a slight decline.
  • Net profit forecasts: Showed a notable decline, with expectations of trimming 4Q15 forecasts.

Sector Forecasts (2015)

• Operating Profit:

  • Energy: Increased from 4.5t to 4.6t.
  • Materials: Slightly increased.
  • Industrials: Sharp decline, turning negative.
  • Consumer Discretionary: Increased.
  • Consumer Staples: Increased.
  • Healthcare: Increased.
  • Financials: Slightly increased.
  • IT: Increased.
  • Telecom Services: Increased.
  • Utilities: Increased significantly.

• Net Profit:

  • Energy: Increased.
  • Materials: Increased.
  • Industrials: Turned negative.
  • Consumer Discretionary: Increased.
  • Consumer Staples: Increased.
  • Healthcare: Increased.
  • Financials: Slightly increased.
  • IT: Increased.
  • Telecom Services: Increased.
  • Utilities: Increased significantly.

Conclusion

The Samsung Universe and MSCI Korea indices are expected to show improved earnings in 2015 compared to the previous year, with notable growth in net profit. The strong performance in certain sectors, such as utilities and consumer discretionary, has contributed significantly to this growth. However, there are concerns about the potential trimming of 4Q15 forecasts and the slowdown in net profit growth for 2016. Valuation metrics remain relatively stable, with forward P/E and P/B ratios within historical ranges. The report highlights the importance of monitoring sector-specific changes and their impact on overall financial performance.