Samsung Australia posts AU$38m FY18 profit

The AU$58 million loss reported last year has turned into a AU$38 million profit this year.

Samsung's Australian subsidiary has revealed making a net profit of AU$38 million for the year ended December 31, 2018, a complete turnaround from last year's AU$58 million loss.

The results, lodged with the Australian Securities and Investments Commission (ASIC), also revealed revenue of AU$2.6 billion, up marginally from the AU$2.5 billion reported for the previous financial year.

Despite paying more in taxes -- from AU$6.9 million in 2017 to AU$34.9 million in 2018 -- Samsung Australia had a cash inflow of AU$10.6 million from operating activities for the financial year, a turnaround from the AU$13 million outflow reported last year.

For FY17, Samsung Australia had cited a combination of paying more to suppliers than was received from sales, and AU$27 million income tax refund for 2016 turning into a AU$6.8 million income tax payment in 2017 for its lower results.

Read also: Samsung Galaxy S10, S10+, S10e pricing in Australia

Parent company Samsung Electronics earlier this month said it expects to see a 60% year-on-year decline in profits for Q1 of the new financial year, with operating profits of 6.2 trillion won and revenues of 52 trillion won, according to the company's earning guidance.

This would be the company's lowest operating profit in 10 quarters, and also a decline of 42.6% from the previous quarter.

Revenue is expected to suffer a drop of 14.1% from a year ago and 12.3% lower than the previous quarter due to the downturn in the global memory semiconductor market and declining prices for display panels.

The Korean tech giant could also see a drop in the face of the debacle surrounding its $2000 Galaxy Fold smartphone, which has now been delayed worldwide due to issues with review units.

Read also: It's too early to fold Samsung Galaxy Fold for good

Samsung earlier this week announced that it would be investing 133 trillion won by 2030 to strengthen its logic chip businesses, aiming to become the global leader in logic chips by 2030 as it currently is in memory semiconductors. Of this, 73 trillion won will be set aside for research and development, and 60 trillion won in production infrastructure.

The company's Device Solutions semiconductor is divided into three businesses: Memory, System LSI, and Foundry. The latter two were originally under one banner, but the company divided them back in 2017 in an effort to expand them.

According to Samsung, 5G will also be an opportunity to expand these businesses; earlier in April, it claimed it is leading the way in South Korea's 5G after having shipped 53,000 base stations and 5G core solutions since December 2018.

The nation's carriers have already switched on their 5G networks nationwide.

"The virtualized 5G core solutions, provided to all three Korean operators for their 5G commercial launch, support both legacy 4G networks and next generation 5G services in non-standalone mode," the company said.

"They can also migrate to standalone mode through a simple software upgrade in the future."

At the end of last year, the Korean giant said it would be investing $22 billion across 5G and artificial intelligence (AI), and wanted to have 20% of the market by 2020. It is currently in fifth place behind Huawei, ZTE, Ericsson, and Nokia in network equipment sales.

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