GuruFocus –
- Q4 Revenue: KRW3.8 trillion, down 5% Q-on-Q and 29% Y-o-Y.
- Q4 Operating Profit: Deficit of KRW257 billion including results from discontinued operations.
- Annual Revenue 2024: KRW16.6 trillion, decreased by 23% Y-o-Y.
- Annual Operating Profit 2024: KRW363 billion, down 77% Y-o-Y.
- Assets: Increased by KRW6.5 trillion to KRW40.6 trillion.
- Liabilities: Rose by KRW4.9 trillion to KRW19.2 trillion.
- R&D Expenditure 2024: KRW1.3 trillion.
- CapEx 2024: KRW6.6 trillion.
- Battery Business Q4 Revenue: KRW3.6 trillion, down 3% Q-o-Q and 29% Y-o-Y.
- ESS Battery Revenue: Reached a record high due to increased sales.
- Electronic Materials Q4 Revenue: KRW190 billion, down 28% Q-o-Q and 31% Y-o-Y.
- Electronic Materials Q4 Operating Profit: KRW11.6 billion, down 82% Q-o-Q and 83% Y-o-Y.
- Annual Battery Revenue 2024: KRW15.7 trillion.
- Annual Battery Operating Profit 2024: KRW218 billion.
- Annual Electronic Materials Revenue 2024: KRW901 billion.
- Annual Electronic Materials Operating Profit 2024: KRW145 billion.
- Dividend Policy: No dividend for the next three years due to negative free cash flow.
Release Date: January 24, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Samsung SDI (KS:) Co Ltd (FRA:XSDG) successfully initiated early operation at the Stellantis (NYSE:) joint venture Starplus Energy in the US, securing high yield and quality.
- The company finalized a joint venture agreement with GM, expanding its EV business in the US.
- ESS battery revenue reached a record high due to increased sales backed by growing power demand for data centers.
- Samsung SDI Co Ltd (FRA:XSDG) received CO2 footprint verification from Carbon Trust and platinum validation for zero waste to landfill at all sites.
- The company is enhancing cooperation with multiple OEMs for 465 battery projects, with some products in the final stages of securing orders.
Negative Points
- Q4 revenue decreased by 5% quarter-on-quarter and 29% year-on-year due to slowing market demand.
- Operating profit reported a deficit of KRW257 billion, including results from discontinued operations.
- The battery business reported a significant drop in operating profit due to lower utilization and increased fixed costs.
- Demand for power tool and micro mobility batteries declined, impacted by the sluggish housing market and weakened consumer purchasing power.
- Samsung SDI Co Ltd (FRA:XSDG) plans to pay no dividend for the next three years due to negative free cash flow projections.
Q & A Highlights Q: Can you provide details about the one-off expenses in Q4 and the profitability without them?
A: The Q4 one-off expenses included inventory asset valuation impairment and quality-related provisioning. Without these, the battery business would have recorded a low single-digit percentage profit, and the company-level profit would likely be above break-even.
Q: What is the guidance for Q1 and full-year 2025, and are there any changes to the CapEx plan due to market uncertainties?
A: The EV market is expected to grow, but policy uncertainty remains high. Recovery is challenging, but improvements are expected from the second half of the year. CapEx will be more conservative, focusing on investment efficiency, with necessary investments for future growth proceeding as planned.
Q: What are the plans for the Stellantis joint venture and ESS capacity expansion in the US?
A: The Stellantis joint venture began operations ahead of schedule, with additional lines coming online this year. ESS capacity will be increased by at least 20% through production line efficiency and EV battery line conversion. Local production options in the US are being studied.
Q: How will Samsung SDI address weak demand in the cylindrical battery business, and what is the strategy for electronic materials?
A: New high-power batteries will be launched to expand sales in power tools and battery backup units. For electronic materials, the focus will be on increasing sales to key customers and expanding into new markets, despite high uncertainty.
Q: What are Samsung SDI’s plans for LFP battery development and commercialization?
A: Samsung SDI has developed a differentiated LFP platform for EV and ESS markets, focusing on higher energy density and cycle life. Mass production projects are being discussed with key customers, with plans to start production of the LFP-based SPB 2.0 next year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
