SAMSUNG ELECTRONICS CO., LTD.

Mar 03 - 09, 2008

ABOUT SAMSUNG ELECTRONICS:

Samsung Electronics Co., Ltd. is a global leader in semiconductor, telecommunication, digital media and digital convergence technologies with 2006 parent company sales of US$64.2 billion and net income of US $91.9billion. Founded in 1969, the Korean firm employs approximately 138,000 people in 124 offices in 56 countries. The company consists of five main business units: Digital Media Business, LCD Business, Semiconductor Business, Telecommunication Network Business and Digital Appliance Business. Recognized as one of the fastest growing global brands, Samsung Electronics is a leading producer of digital TVs, memory chips, mobile phones and TFT-LCDs.

MISSION AND DIGITAL VISION

The vision of SAMSUNG Electronics is "Leading the Digital Convergence Revolution" and our mission to carry out this vision is "Digital-? Company.

There are two requirements for being "Digital-? Company", and the first is clearly about being "Digital" producing not just digital products, but products that inspire digital integration across our entire company. The second part of being a "?" is to use ?- Processes connecting R&D, production, and marketing to customers, partners, and the market-disciplined approach is the way we bring value to every part of our supply chain, including products data and customer relationship through Enterprise Resource Planning (ERP).

SAMSUNG Electronics will network core components such as memory chips, system-LSI and LCDs as well as A/V, computers, telecommunication devices, home appliances and other stand-alone products into a total solution of digital convergence era.

For this goal, electronics was restructured into 4 strategic business areas - Home Network, Mobile Network, Office Network and Core components - that support products network. Also, we have pioneering products and technology in the semiconductors, telecommunication devices and home appliances fields, which will make SAMSUNG Electronics a most competitive total solution provider in digital convergence.

4 STRATEGIC BUSINESS AREAS

SAMSUNG Electronics will strengthen its already strong core component businesses such as memory chips and TFT-LCDs, and focus on high valued products such as system LSI, small & mid-size LCDs, and optical components. Also in the future, based on even SOC (System On a Chip) and SOP (System On a Panel) that are main parts of all machinery industries, we will focus on three network business areas.

First of all, our Home Network business will be centered on digital TV and home server and home gateway businesses. Secondly, Mobile Network business will be based on wireless handsets. We will expand this business into PDAs and laptops and set up the next generation telecommunications, IMT-2000 system. Thirdly, in Office Network business, we will focus on printers, IP Terminal, info mobile as well as existing display area.

SAMSUNG Electronics has 9 tier 1 products in the global electronics market. In addition to these tier 1 products, - memory chips, TFT-LCDs, CDMA handsets, display devices and more. We will include digital TVs, IMT-2000, computer peripherals, and Home Appliances as our new tier 1 products to strengthen 4 strategic business areas and setup firm foundation for future growth. Also, we will focus on core components such as SOC, SOP and so on that are essential for network products based on core R&D technology and ?-Process.

NO. 1 IN THE WORLD

To reduce the lead time on supply chain SAMSUNG electronics networked 4 processes, which are, customer management process, R&D management process, and supply chain management process. It is ?-Process that connects R&D, production, marketing and customers. Also, as we acknowledged the need for IT infrastructure to speed up 4 processes, we adopted ERP (Enterprise Resource Planning) system in domestic and overseas subsidiaries.

SAMSUNG Electronics will converge and network SCM (Supply Chain Management), PDM (Product Data Management), and CRM (Customer Relationship Management) systems and set up global real-time management information systems.

BRAND VALUE

In the digital era, products will be distinguished by brand more than by its functions or quality. Since 1999 SAMSUNG Electronics is practicing global brand communication strategy. Based on the research done by Interbrand INC., USA, SAMSUNG Electronics is the fastest growing brand from 6.4billion USD (2001) to 12.55 billion USD (2004) in brand equity.

In the future, SAMSUNG Electronics will practice holistic marketing strategy instead of individual marketing plans to strengthen its market power and increase brand value with high quality products. Under the brand concept of "Wow, Simple, Inclusive", SAMSUNG Electronics is launching a worldwide brand campaign.

MARKET ORIENTED ENTERPRISE

SAMSUNG Electronics provides a unique solution that fits customers' needs. For this, we will expand the marketing platform based on global CRM (Customer Relationship Management) that is applicable to all products. Also we will develop a digital network platform that improves compatibility between products to serve our customers with the best solution. SAMSUNG Electronics is putting and will continue to put our customers' needs first to go forward as a market-driven and reliable company.

FINANCIAL HIGHLIGHTS

[In thousands of U.S. dollars (note3)]

 

2006

2005

Sales (Note 28)

$91,954,388

$86,791,722

Cost of sale (Note 28)

64,211,262

59,474,333

Gross profit

27,743,126

27,317,389

TELECOMMUNICATION NETWORK BUSINESS

The Samsung Electronics Telecommunication Business earned an impressive operating profit of W1.73 trillion on sales of W18.23 trillion in 2006. Samsung mobile phones have emerged as a world-class brand, thanks to their superior quality, technology and designs. They are the product of choice for millions of consumers in the US, Europe, China and elsewhere, helping to elevate the image of Korea in the eyes of the world.

Despite tough market conditions, we sold 118 million mobile phones in 2006, up 18% from the year before. This performance can be attributed to our outstanding technological capability to introduce a steady stream of premium Samsung mobile phones that are setting market trends.

The robust growth in sales has solidified Samsung's position as the world's third largest mobile phone maker. Our mobile phone business priorities are to be both the world's first and the world's best. This dedication to excellence has earned Samsung mobile phones a premium product cachet worldwide; they're referred to as the "Mercedes-Benz of mobile phones" in Europe and are a symbol of the wealth in China. Our "world firsts" in 2006 include a mobile phone with a 10-megapixel camera and the Super Music Phone (SCH-B570), with a built-in 8GB hard disc drive.

In 2007, the Telecommunication Network Business continues to prepare for the future as a leader in both mobile phones and mobile communication systems. We have the technology to commercialize phone models for all available mobile TV formats, including DMB (satellite and terrestrial), mediaFLO, and DVB-H. We are also at the forefront of mobile products that can access the broadband internet.

Samsung hosts the annual 4G Forum to lead the development and standardization of 4th-generation mobile communication technologies. The goal is to create a world where communication access is truly "ubiquitous."