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  • Page 1
    2007 Samsung electronics annual report
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    ... digital appliance semiconductor LCD 34 38 42 46 50 thinking more of you corporate citizenship co-prosperity green management financial statements investor information global network 56 58 60 63 130 131
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    ...2005 80,630 7,575 7,640 2006 85,426 9,008 7,926 2007 98,508 8,973 7,421 Balance Sheet Total Assets Total Liabilities ... be entirely assumed by you. All the financial data in this report comes from the consolidated financial statements. Samsung electronics annual report 2007 01
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    ...(loss) [in trillions of KRW ] [in millions of KRW ] 26.5 17.7 Digital Media 0.7 2006 20.8 2005 2006 2007 1.06 Net sales Operating profit ...KRW ] 2006 2007 [in millions of KRW ] 2005 2006 2007 Digital Appliance 5.6 5.5 6.9 Net sales \ 5,617,708 (29,102)...
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    ... a sixth consecutive year. In ongoing efforts to enhance our leadership, we also have begun mass producing the world's first touch-screen-enabled LCD. Samsung electronics annual report 2007 03
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    Message from the CEO By increasing management prowess and embracing innovation at every opportunity, Samsung Electronics will become one of the most profitable and most revered global companies.
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    ..., we focused on increasing our R&D workforce to strengthen its future contribution to our company and, as a result, the number of R&D engineers reached 39,000. Samsung electronics annual report 2007 05
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    ...As part of our goal of becoming a true upper-echelon global leader, Samsung Electronics will concentrate on further developing its innovative approaches to management with a focus on speed, efficiency and creativity, and generating new values through ...
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    ...promising model for becoming what I envision to be "the best of the best." Yoon-Woo Lee Vice Chairman and Chief Executive Officer Samsung Electronics Co., Ltd. Samsung electronics annual report 2007 07
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    ... and overall corporate value. We are also sustaining shareholder focused management to ensure that our profitable earnings and corporate values benefit our shareholders.... and Asset have rated Samsung again among the very best in terms of investor relations and corporate governance....
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    ... Co., Ltd. [Present] Vice Chairman, Corporate CTO & Global Collaboration, Samsung Electronics Co., Ltd., Vice Chairman, Samsung Advanced Institute of Technology ... [2003-2005] • Chairman, Korean Human Resources Management Institute [2002-2003] • Samsung electronics annual report 2007 09
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    ...No. 2 in 2006 for the number of U.S. R patents registered  chieved No. 1 market share for the sale of A mobile phones ...saving 256-channel  display driver for Plasma screens E xported 3G CDMA system to Indonesia ... Developed the world's first 65nm-class digital TV  receiver chip  argest number ...
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    ... year. World's No. 1 Market Share DisplaySearch, the worldwide authority in display market research, identified Samsung as the leader in unit share and ... monthly US$2 billion LCD panel S sales total for the first time • • • • Samsung electronics annual report 2007 11
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    ... preeminent market leadership. thinking In today's competitive world, if a company remains stagnant, it can quickly become obsolete. Consumers have many choices, ... our customers through the production and sale of world-class products and, most importantly, by anticipating their ...
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    ahead of you Samsung electronics annual report 2007 13
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    ... such as the digital TV, smart phone, music phone, video MP3 player, side-by-side refrigerator and drum washing machine. Supported by a sound ... a little girl, Sarah's dream was to be a world-famous rock star. With Samsung's LCD TV and Blu-ray DVD player, Sarah can record and ...
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    ... high image quality of our LCD TV with the latest Blu-ray player. And, watch your favorite movies for the first time as a completely new, high definition experience. Samsung electronics annual report 2007 15
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    .... Our premium products include the TOC monitor, Armani TV, J-Series refrigerator by Jasper Morrison, and a five-megapixel camera phone. Building on advanced technology with versatile features and stylish design, our innovative premium products will...
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    ... designed monitors provide you with the power and features to help drive your business well into the future. c BlackJack II (SGH-i617) Boost productivity whether you're in the office or on the road with the award-winning BlackJack II. Samsung electronics annual report 2007 17
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    ...emerging markets, including China, is a major opportunity for Samsung Electronics. With aggressive marketing and locally customized products, including digital media, mobile phones and home appliances, we are providing a more comfortable and...
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    ... trend in washing machines is our silent, but powerful, drum washing machine. From an attractive design to top-notch performance, this washing machine has it all. Samsung electronics annual report 2007 19
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    thinking thinking
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    ... of customers worldwide, which will propel our company and our brand well into the future. company in its annualInfo Tech 100. company in its annualInfo Tech 100. Samsung electronics annual report 2007 21
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    ... launching mobile phone and LCD TV lines, and worked with the world-famous industrial designer Jasper Morrison in designing mobile phones, side-by-side refrigerators and electric ranges. In addition, ... Time Warner Samsung Electronics partnered with Time Warner Cable, the second largest cable company ...
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    ... with our customers. Providing a Wide Range of Benefits for Worldwide Tourists Outstanding displays by Samsung ... phones and notebook PCs, free of charge, where electrical receptacles are lacking. Actively promoting ... technology. Samsung Experience at Time Warner Center in New York City Located in New ...
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    ... we provided our unique Wireless Olympic Works ( WOW ) service, a communications system designed to bring the power of mobile wireless technologies to the ...the Chelsea Football Club, Samsung Electronics will play a key part in its global development. Both brands share the same ...
  • Page 27
    ... in 2000. To promote e-sports, we operate Samsung Khan, a professional online game team. Nurturing Culture and Education Sponsoring a ... to share our passion with the world and contribute to the betterment of society. er ,C orporate Samsung electronics annual report 2007 Communications Team 25
  • Page 28
    ... division are responsible for commercializing products scheduled to hit the market within one or two years. Samsung Electronics operates six R&D centers in Korea and a total of... lives of our customers. At the end of 2007, 39,000 people were involved in the development of Samsung products...
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    ... paper (e-paper), delivering undistorted images even when the surface is bent. This flexible display does not require any electricity. 14.3-inch e-paper b c c Samsung electronics annual report 2007 27
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    a b
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    ... YP-S5 is an extremely portable multimedia device. Its full color screen makes watching videos a pleasure while its fold-out speakers are powered by ... The device attaches to a mobile network connection and is designed to enhance coverage for the home. b c Samsung electronics annual report 2007 29
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    ... powerful multimedia device comes fully equipped with a five megapixel camera and a 3.2-inch, 16:9 wide touch screen. Plus, it is built with Samsung's award-winning Croix user interface, enabling greater convenience and ease of use. ...
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    ... Hanover honored 26 Samsung products, including LCD TVs, mobile phones, note PCs, and laser printers... Gold Prize for our side-byside refrigerator. Samsung's Ultra Edition II mobile phone and portable DMB TV received ...i Unit gn er ], Corporate Samsung electronics annual report 2007 Design 31 Center
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    .... thinking Like modern-day pioneers, Samsung Electronics has opened doors to new worlds through our innovative products and... fostering more strategic alliances, and delivering an unrivaled customer experience, Samsung has catapulted itself to the forefront of efforts to enhance consumer lifestyles, ...
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    smarter for you Samsung electronics annual report 2007 33
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    digital media
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    .... 26.5 20.8 17.8% 7.4 2006 2007 2006 10.6 2007 WORLDWIDE TV MARKET SHARE IN 2007 [By Sales] [KRW trillion] SALES [KRW hundreds of billion] ... we were also honored with an iF Design Award for the quality of a wide range of our digital media products. Samsung electronics annual report 2007 35
  • Page 38
    ... the world's largest (70-inch) Full HD LCD TV Samsung Electronics introduced the world's largest, commercially available Full HD LCD TV. It... profits after converting all exported notebook PCs to the Samsung brand last year. In 2008, with a wide range of new products, such as ...
  • Page 39
    ... of the Year" in the Display Technology category of the VARBusiness Annual Report Card (ARC), recognizing Samsung... the No. 2 market share globally with these innovative players. The Samsung digital cameras, backed ... to add more freedom to anyone's lifestyle. Samsung electronics annual report 2007 37...
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    telecommunication networks
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    ... and Sound Association ( EISA) Awards and "Phone of the Year" at the Mobile Choice Award, securing our reputation for providing the world's best mobile phones. Samsung electronics annual report 2007 39
  • Page 42
    ...research conducted by Brand Keys, a U.S. market research company, Samsung was selected as the most favored mobile phone brand for the sixth year in a row... phone lineup with multimedia phones that include a full touch screen user interface and enhanced versions of Samsung Soul, our worldwide flagship ...
  • Page 43
    ..., we launched the Giorgio Armani Samsung mobile (SGH-P520). The touch screen model features cutting-edge phone technology, such as a three ... convergence will further bolster our mobile communication brand as the industry takes mobility to the next level. Samsung electronics annual report 2007 41
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    digital appliance
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    ... in Germany. In Korea, we also placed first in the 2007 National Customer Satisfaction Index (NCSI) in the refrigerator, washing machine and air conditioner categories. Samsung electronics annual report 2007 43
  • Page 46
    ...-Side Refrigerators Since side-by-side refrigerators were introduced in Korea in 1997, Samsung Electronics has led the.... Also in 2007, J.D. Power and Associates awarded our side-by-side refrigerators its "Highest Customer Satisfaction" rating for the third straight year. In 2008, Samsung Electronics'...
  • Page 47
    ... 4 Highest Customer Satisfaction rat- ing by J.D. Power Samsung's side-by-side refrigerators received the "Highest Customer Satisfaction" rating for the third year in a ... to the conventional oven, grill and microwave, as well as dry heat and fermenting. Samsung electronics annual report 2007 45
  • Page 48
    semiconductor
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    ... with continued market dominance in most areas of the memory business, including strong sales in DRAM, SRAM, MCPs, flash memory and fusion memory devices. Samsung electronics annual report 2007 47
  • Page 50
    ... Leadership In 2007, Samsung Electronics easily held on to its No. 1 position in the memory industry with 28% ... and mobile devices. We also succeeded in producing the world's first 60nm-class ... memory products are expected to account for an increasingly major part of the Samsung memory business over ...
  • Page 51
    ...16M-color display driver IC (DDI) for active-matrix OLED (AMOLED) displays used in mobile phones and other... the HDD market, Samsung Electronics produces high-capacity hard drives for both mobile devices and ... more durable, quieter, and more energy efficient. Samsung electronics annual report 2007 49
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    LCD
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    ... industry in a wide variety of applications. In 2007, Samsung Electronics was ranked No. 1 in display panels for TVs, desktop monitors and notebook PCs, achieving a ... globally for six consecutive years, ensuring our continued leadership in the LCD industry. Samsung electronics annual report 2007 51
  • Page 54
    ...or greater. Small- and Mid-sized Panels We are producing a wide range of AMOLED sizes for premium mobile multimedia devices. The displays use Samsung's proprietary amorphous silicon gate technology and their production has reduced the mobile panel...
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    ...introduced next-generation standards for color displays and black-and-white e-paper, plus several commercial sizes of AMOLEDs as we continue to accelerate...such aggressive expansion efforts, we will consolidate our status as the world's leading LCD producer. Samsung electronics annual report 2007 53
  • Page 56
    ... lies beyond them. thinking Making industry-leading products is only part of the big picture. Our commitment ...nurturing our local communities through corporate social responsibility and co-prosperity initiatives. Samsung has also remained steadfast when it comes to supporting education initiatives, ...
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    more of you Samsung electronics annual report 2007 55
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    Corporate Citizenship We share with all communities our hope for a brighter future, and try each day to make ... each of our eight major volunteer centers and have collaborated on a wide range of programs with Samsung Community Relations, the Samsung Group's social contribution organization. In 2007, ...
  • Page 59
    ...surgery for patients in need, were highly praised by the communities they served. In 2007, the Guangming Daily awarded Samsung Electronics, for the third...our employees contributed a portion of their salaries to further our corporate citizenship initiatives. Samsung electronics annual report 2007 57
  • Page 60
    ... participation through Samsung Partners' Day, inviting hundreds of executives to share management goals ... Office under the CEO to drive more efficient and rewarding win-win alliances... to improve business management controls internally by sharing transaction information with Samsung Electronics in real...
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    ...Partner Companies" event, attended by 196 partner companies and our employees. At the event, our partners presented a wide range of innovative ideas to sharpen our mutual leadership in technology while enhancing the cohesiveness of our partnerships. Samsung electronics annual report 2007 59
  • Page 62
    ...for our people and planet. green Green Management Initiative to be a Global Standard Building upon Samsung's philosophy of contributing to a better ... set up their own environmental quality management systems. Minimizing the Environmental Impact Samsung Electronics is developing cleaner production ...
  • Page 63
    ... leader of environment initiatives to address global warming, Samsung Electronics introduced the "Catch CO2 Project" in 2002, a voluntary initiative to reduce ... able to provide further information on our product-related environmental policies .and programs. Samsung electronics annual report 2007 61
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  • Page 65
    ... Statements of Cash Flows Consolidated Five-year Financial Summary 66 68 69 73 75 Notes to the Consolidated Financial Statements 77 Investor Information Global Network 132 133 Samsung electronics annual report 2007 63
  • Page 66
    ... audits. We did not audit the financial statements of Samsung Card Co., Ltd. and ... supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting ... in Note 18 to the accompanying consolidated financial statements, Samsung Electronics Co., Ltd. ("SEC...
  • Page 67
    ...consolidated financial statements. Accounting principles and auditing standards and their application in practice..., the procedures and practices used in the Republic of Korea to audit such financial statements may... subsequent events or circumstances, if any. Samsung electronics annual report 2007 65...
  • Page 68
    ... financial instruments (Note 4) Short-term available-for-sale securities (Note 5) Short-term held-to-maturity securities (Note 5) Trade accounts and notes receivable, net of allowance for doubtful accounts (Note 6) Other accounts and notes ...
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    ... (Note 3)) Liabilities and Shareholders' Equity Current liabilities Trade accounts and notes payable Short-term borrowings (Note 13) Current ... 86,744,356 The accompanying notes are an integral part of these consolidated financial statements. Samsung electronics annual report 2007 67
  • Page 70
    ... (Note 24) Net income Controlling interests Minority interests Basic earnings per share (Note 25) (in Korean won and U.S. dollars)... (in Korean won and U.S. dollars) ₩ The accompanying notes are an integral part of these consolidated financial statements.
  • Page 71
    ...,574 20,082 355,350 ₩ 897,514 ₩ 6,364,604 ₩ (6,994,210) ₩ 532,820 ₩ 44,463,683 ₩ 2,675,456 ₩ 47,939,867 continued Samsung electronics annual report 2007 69
  • Page 72
    ... Changes in Shareholders' Equity Years Ended December 31, 2007 and 2006 (In millions of Korean won) Capital Stock ... valuation of equity-method investments Translation of foreign currency financial statements Others Shareholders' equity, December 31, 2007 Capital Surplus Accumulated Other ...
  • Page 73
    ... 378,838 $  956,838 $   6,785,292 $ (7,456,514) $  568,038 $ 47,402,647 $  2,852,299 $ 51,108,600 continued Samsung electronics annual report 2007 71
  • Page 74
    ... equity-method investments Translation of foreign currency financial statements Others Shareholders' equity, December 31, 2007 Capital Surplus Accumulated Other Capital ...440,484 $ 4,590,854 $ 59,671,544 The accompanying notes are an integral part of these consolidated financial statements.
  • Page 75
    ... net cash provided by operating activities Depreciation and amortization Provision for severance benefits Loss on transfer of trade accounts and notes receivable Bad debt ... 3,228,654 (1,964,136) 601,296 3,964,091 (3,963,921) continued Samsung electronics annual report 2007 73
  • Page 76
    Consolidated Statements of Cash Flows Years Ended December 31, 2007 and 2006 (...Decrease (increase) in other accounts and notes receivable Proceeds from disposal of property, plant and ...4,352,683 4,501,095 The accompanying notes are an integral part of these consolidated financial statements.
  • Page 77
    ... 70 520 0 9,828 11.5% 1,634 (268) 7,926 9.3% 2007 98,508 70,881 27,627 28% 18,654 8,973 9.1% 660 171 378 0 9,633 9.8% 1,710 (502) 7,421 7.5% continued Samsung electronics annual report 2007 75
  • Page 78
    ...Debt to Equity Net Debt / Equity Earnings per share (KRW) * Cash & Cash Eq. includes short-term financial instruments 2003 21... and thus may be different from those in audited financial statements. Financial sectors are included in the consolidated base financial statements ...
  • Page 79
    ... is the sum of the percentage of direct and indirect ownership. The consolidated financial statements include the accounts of the consumer financing subsidiary, Samsung Card Co., Ltd., in accordance with the consolidation accounting standards...
  • Page 80
    ... 50.63 83.33 100.00 100.00 50.00 100.00 Location Korea Korea Korea... Korea Korea Korea Samsung Gwangju Electronics Co., Ltd. Home appliances manufacturing Samsung Card Co., ...of electronic goods and mobile phone 100.00 U.S.A continued 1. As of June 27, 2007, Samsung Card ...
  • Page 81
    ....00 100.00 100.00 100.00 Slovakia Israel Russia Poland Samsung Electronics Holding GmbH (SEHG) Holding company (financing) Samsung ...00 South Africa 100.00 Slovakia continued Samsung Electronics Slovakia s.r.o. (SESK) Monitor manufacturing Samsung electronics annual report 2007 79
  • Page 82
    Notes to the Consolidated Financial Statements continued (In millions of Korean won) Subsidiaries Samsung Electronics Overseas B.V. (SEO) LLC Samsung Electronics Rus Company (SERC) LLC Samsung Russia Service Center (SRSC) Samsung Japan Corporation (SJC) ...
  • Page 83
    ...) Service Samsung Electronics Huizhou Co., Ltd. (SEHZ) A/V manufacturing Tianjin Samsung Electronics Display Co., Ltd. (TSED) Monitor manufacturing Souzhou Samsung Electronics Co., ....00 China 100.00 China 100.00 China 100.00 China 70.00 China Samsung electronics annual report 2007 81
  • Page 84
    ...of subsidiaries as of and for the year ended December 31, 2007, included in the consolidated financial statements follows: (In millions of Korean won) Subsidiaries Assets Liabilities Samsung Gwangju Electronics Co., Ltd. ₩ Samsung ...
  • Page 85
    ...Semiconductor sales In accordance with consolidation accounting standards generally accepted in the Republic of Korea, the financial statements of the above subsidiaries ... excluded from the consolidated financial statements for the year ended December 31, 2007, are as follows: Location Name of ...
  • Page 86
    ... The significant accounting policies followed by the Company in the preparation of its consolidated financial statements are summarized below: ... and Supervisory Board. As SKFAS No. 11, No. 21 and No. 24 ..., Preparation and Presentation of Financial Statements (Financial Industry), Samsung Card Co., Ltd...
  • Page 87
    ... of operations. Certain equity-method investments are accounted for based on unaudited or unreviewed financial statements as the audited or reviewed financial statements of these.... A new basis for calculating depreciation is established for revalued assets. Samsung electronics annual report 2007 85
  • Page 88
    Notes to the Consolidated Financial Statements continued Depreciation is computed using the straight-line method over the following estimated ... of the countries in which they operate. In translating the foreign currency financial statements of these subsidiaries into Korean won, income and expenses ...
  • Page 89
    ... each other. Long-Term Receivables and Payables Long-term receivables and ... is made in the notes to the financial statements. Derivative Instruments Derivative financial instruments for trading or hedging ... as an asset impairment loss in the current period. Samsung electronics annual report 2007 87...
  • Page 90
    Notes to the Consolidated Financial Statements continued 3. United States Dollar Amounts The Company operates primarily ...-sponsored research and development projects Other activities Long-term financial instruments Special deposits Other activities 2007 35,632 34,548 70,...
  • Page 91
    ... securities as of December 31, 2007 and 2006, consist of the following: (In millions of Korean won) Government and public bonds ₩ 2007 130 ₩ 2006 248 Samsung electronics annual report 2007 89
  • Page 92
    Notes to the Consolidated Financial Statements continued 6. ACCOUNTS AND NOTES RECEIVABLE Accounts and notes receivable, and their allowance...885 ₩ 2006 4,002,923 From 2003 to 2005, Samsung Card Co., Ltd. transferred credit card receivables and financial assets to SangRokSoo 1st Securitization...
  • Page 93
    ... millions of Korean won) Accounts Short-term financing receivables Credit card assets Lease assets... Less: Allowance for doubtful accounts Long-term financing receivables Credit card assets Lease assets...449,031) 3,806,535 8,393,507 Samsung electronics annual report 2007 91
  • Page 94
    Notes to the Consolidated Financial Statements continued Collection schedule of installment finance and general loans as of December ... won) Automobiles Electronic system Less: Accumulated depreciation Accumulated impairment losses Operating lease assets ₩ 2007 867,157 12,...
  • Page 95
    ...following: (In millions of Korean won, except for the number of shares and percentage) 2007 Number of Shares Owned Related parties Samsung Heavy Industries Co., Ltd. 40,675,641 Samsung Fine Chemicals Co., Ltd. 2,969,730 The ...
  • Page 96
    ... of the following: (In millions of Korean won, except for the number of shares and percentage) 2007 Number of Shares Owned Related parties Samsung Petrochemical Co., Ltd. 514,172 Samsung General Chemicals Co., Ltd. 1,914,251 Samsung ...
  • Page 97
    ... Co., Ltd. declined significantly, the difference between the book value and recoverable amount amounting to ₩20,700 million was charged to impairment loss. Samsung electronics annual report 2007 95
  • Page 98
    Notes to the Consolidated Financial Statements continued The maturities of long-term held-to-maturity securities as of December ... Investee Shares Owned Ownership (%) Cost Book Value Book Value Samsung SDI ... Co., Ltd. Shanghai Bell Samsung Mobile Communications Co., Ltd. eSamsung Greater...
  • Page 99
    ... - - 294 49.00 49.00 49.03 ₩ 2,061 7,742 150,451 1,911,229 3,683 4,458 19,926 ₩ 3,445,782 3,356 3,233 50,518 ₩ 3,393,617 Samsung electronics annual report 2007 97
  • Page 100
    Notes to the Consolidated Financial Statements continued Changes in goodwill (negative goodwill) for the years ended... SDS Co., Ltd. Samsung Networks Inc. ₩ 2006 Property, Plant and Equipment... Co., Ltd. Shanghai Bell Samsung Mobile Communications Co., Ltd. Others ₩   6,593...
  • Page 101
    ...116,075 11,945 - 128,020 104,520 11,555 - 116,075 Samsung SDI (Malaysia) Sdn.Bhd. 27,679 (6,325) 1,992 23,346 ... 3,393,617 ₩ 377,626 ₩ 11,170 ₩ 3,782,413 ₩ 2,923,314 ₩ 519,661 ₩   Samsung electronics annual report 2007 99
  • Page 102
    Notes to the Consolidated Financial Statements continued Financial information of investees as of and for the years ended ...36,104 207,830 28,500 Samsung Corning Precision Glass Co., Ltd.... which are included in the shareholders' equity. On December 28, 2007, Samsung Corning Co., Ltd. merged ...
  • Page 103
    ...following investees: (In millions of Korean won) Location Subsidiaries Percentage of Ownership (%) ¹ Reason Korea Samsung Everland Inc. Allat ¹ International Cyber...696,162) 11,932 (242,078) ₩ 1,166,098 ₩ 33,784,615 Samsung electronics annual report 2007 101
  • Page 104
    Notes to the Consolidated Financial Statements continued In accordance with the Asset Revaluation Law, on January 1, 1980, 1982, 1998 and ... as collaterals for various loans from financial institutions. As of December 31, 2007, property, plant, equipment are insured against fire and other casualty ...
  • Page 105
    ... (In millions of Korean won) Annual Interest Rates (%) as of December 31, 2007 Overdraft General term loans from commercial banks Notes discounted - 5.6... debts of ₩1,933,885 million (2006: ₩2,722,010 million) as of December 31, 2007. Samsung electronics annual report 2007 103
  • Page 106
    ... of the following: (In millions of Korean won) Annual Interest Rates (%) as of December 31, 2007 Korea Energy Management Corporation Samsung Shinhan 4th Special Purpose Company Shinhan Bank and others 4.5 - 5.8 ~ 6.1 ₩ ...
  • Page 107
    ..., 2007 and 2006, consist of the following: (In millions of Korean won) Annual Interest Rates (%) as of December 31, 2007 Non-guaranteed debentures 2.68 ~ 8.5 ₩ 2007 4,337...725,000 ₩ 1,752,645 1,611,300 400,199 17,261 64,303 3,845,708 Samsung electronics annual report 2007 105
  • Page 108
    Notes to the Consolidated Financial Statements continued 15. Foreign Currency Notes and Bonds Unsecured foreign currency notes and bonds ... date of issuance. (B) US dollar floating rate notes US dollar floating rate notes issued by Samsung Card Co., Ltd., one of SEC's domestic subsidiaries, will be ...
  • Page 109
    ... currency exchange rates. As of December 31, 2007, the Company funded 60.7% of severance payable through severance insurance deposits with Samsung Life Insurance Co., Ltd. and Samsung...,328 455,848 134,440 1,638 - - 929,077 1,342,932 39,145 146,875 Samsung electronics annual report 2007 107
  • Page 110
    ... liable for guarantees amounting to $21.6 million undertaken by Citi Bank relating to the guarantees for Samsung Electronics Latinoamerica (Zona Libre), S.A., one... a US$25 million guarantee for Samsung Electronics Hungarian RT. Co., Ltd. relating to the investment incentive contract with the ...
  • Page 111
    ... its affiliates and subsidiaries with Korea Export Insurance Corporation. ( G) As of December 31, 2007, the Company has forward exchange contracts to manage the exposure to changes in ... impact of changes in the fair-value risk on fixed rate long-term debt. Samsung electronics annual report 2007 109
  • Page 112
    Notes to the Consolidated Financial Statements continued A summary of derivative transactions as of and for the year ended December 31, 2007 and... other claims and proceedings pending as of December 31, 2007, the Company's management believes that, although the outcome of these matters is uncertain, ...
  • Page 113
    ... for bank borrowings and for the fulfillment of certain contracts, which do not have a direct adverse effect on the operations or financial position of the Company. Samsung electronics annual report 2007 111
  • Page 114
    Notes to the Consolidated Financial Statements continued (N) A domestic subsidiary of the Company, Samsung Card Co., ..., subject to the Board of Directors' approval, to issue shares of common or preferred stock to investors other ...Stock Number of Shares of GDR 7,695,272 4,251,339 15,390,544 8,502,...
  • Page 115
    ... 167,749 2,000,000 6,660,814 36,608,458 7,855,225 ₩ 44,463,683 1. The Commercial Code of the Republic of Korea requires SEC to ... is no longer required to further accumulate reserve and removed the restrictions on the usage of the existing reserve. Samsung electronics annual report 2007 113
  • Page 116
    ...dividends and year-end dividends are as follows: (A) Interim Dividends Number of shares eligible for dividends Common stock Preferred stock Dividend rate... amount Common stock Preferred stock 2007 (In millions of Korean won and number of shares) 2006 128,758,653 shares 20,253...
  • Page 117
    ... has granted 120,472 shares including 45,472 shares, which had been granted by Samsung Capital Co., Ltd. as part of the merger in 2004. The... to SEC's ownership ratio are included in a separate component of shareholders' equity as other capital adjustments. Samsung electronics annual report 2007 115
  • Page 118
    Notes to the Consolidated Financial Statements continued 24. Income Tax The statutory income tax rate applicable to the Company, including resident surtax... to the actual amount of taxes recorded by the Company for the years ended December 31, 2007 and 2006: (In millions ...
  • Page 119
    ... ₩ (399,886) (755,003) (1,456) (753,547 334,032 ₩ 1,533,307 ₩ (1,199,275) 306,323 791,219 20,090 787,929 286,233 3,290 Samsung electronics annual report 2007 117
  • Page 120
    Notes to the Consolidated Financial Statements continued Deferred income tax assets and liabilities ...909,804 ₩ 78,318 Deferred tax relating to items charged to equity ₩ (757,513...,899 ₩ 1,462,134 ₩ (829,235) The Company periodically assesses its ability to recover deferred...
  • Page 121
    ... the year ended December 31, 2006, presented herein for comparative purposes, have not been restated as permitted under the Korea Accounting Institute Opinion 06-2. Samsung electronics annual report 2007 119
  • Page 122
    Notes to the Consolidated Financial Statements continued 25. Earnings Per Share Earnings per ...and number of shares) Net income as reported on the statements of income Adjustments: Dividends for preferred stock.../365 1,494,909 2006 Number of shares Stock options 1,888,379 Weight ...
  • Page 123
    ... 20,082 (156,147) (3,734) ₩ 9,541,679 ₩ 8,314,380 ₩ 8,763,144 ₩ 8,013,574 778,535 300,806 ₩ 9,541,679 ₩ 8,314,380 Samsung electronics annual report 2007 121
  • Page 124
    Notes to the Consolidated Financial Statements continued 27. Related Party Transactions (A) Significant transactions between ... and 2006, and the related receivables and payables as of December 31, 2007 and 2006, ... 14,179 418,026 5,689,401 1 Payables 2007 2006  164,459 ₩ 244,467...
  • Page 125
    ... 86,296 ₩ 127,143 ₩ 406,364 ₩ 356,168 ₩ 4,395,838 ₩ 4,842,841 ₩ 92,145 ₩ 94,321 ₩ 462,717 ₩ 473,930 Samsung electronics annual report 2007 123
  • Page 126
    ...,630 ₩ 333,796 ₩ 499,446 Cheil Communications Inc. Samsung Everland Co., Ltd. Samsung Heavy Industries Co., Ltd. Samsung Fire & Marine Insurance Co., Ltd. Samsung America Inc. Samsung Deutschland GmbH Others ...
  • Page 127
    ... insurance plan with Samsung Life Insurance Co., Ltd., and fire and other insurance policies with Samsung Fire & Marine Insurance Co., Ltd. In ... who have the authority and responsibility in the planning, directing and controlling of Company operations. Samsung electronics annual report 2007 125
  • Page 128
    Notes to the Consolidated Financial Statements continued 28. Research and Development Costs Research ... currencies in thousands) Foreign Companies Domestic Companies 2007 2006 Account Foreign Foreign... 451,097 Others 2,836,363 Trade accounts and US$ 1,458,416...
  • Page 129
    ...906 EUR 854,414 Others Long-term other US$ 100,000 accounts payable Others Foreign currency notes and bonds (including current portions... 2007, amounted to ₩128,577 million and ₩122,597 million, respectively. Samsung electronics annual report 2007 127
  • Page 130
    ...520 1,791 362,274 90,404 271,870 ₩ ₩ ₩ ₩ ₩ ₩ The above consolidated financial statements of the non-financial business include the financial service subsidiary which is accounted for using the equity method.
  • Page 131
    ... profit of each segment is inclusive of all consolidation eliminations. The presentation and classification of 2006 was revised for comparability with 2007 presentation. Samsung electronics annual report 2007 129
  • Page 132
    Notes to the Consolidated Financial Statements continued Operating data of entities classified according to geographic area as of and ... ended December 31, 2007: (In millions of Korean won) 2007 Summary of Business by Geographic Area Korea Domestic Export Gross sales Intersegment sales...
  • Page 133
    ... Financial Statements The consolidated financial statements as of and for the year ended December 31, 2007, were approved by SEC's Board of Directors on March 4, 2008. Samsung electronics annual report 2007 131
  • Page 134
    ... consequential, special, or similar damages. ADDITIONAL INFORMATION The 2007 Samsung Electronics Annual Report and the latest investor information are available online at www.samsung.com/ir. You may also contact us at [email protected]...
  • Page 135
    ... Samsung Electronics Southeast Asia Headquarters 3 Church Street #26-02 Samsung Hub, Singapore 049483, Singapore PRODUCTION NETWORK KOREA Suwon Complex 416, Maetan 3-dong, Yeongtong-gu, ...-dong, Gumi Gyeongsangbuk-do Tel: 82-54-479-5114 Fax: 82-54-479-5058 Samsung electronics annual report 2007 133
  • Page 136
    ...: 86-512-6253-8988 (6688) Samsung Electronics Suzhou LCD Co., Ltd...-22-2532-1234 Tianjin Samsung Electronics Display (TSED), Tianjin Tel: 86...-8396-9600 Tianjin Tongguang Samsung Electronics Company (TTSEC), Tianjin Tel: 86...-21-8983-7114 Malaysia Samsung Electronics Display (M) SDN. BHD. (SDMA), Seremban...
  • Page 137
    ... Vina Electronics Co., Ltd. (SAVINA), Ho Chi Minh City Tel: 84-8-896-5500 EUROPE Austria Samsung Electronics Austria Gmbh (SEAG), Vienna Tel: 43-1-... Office Tel: 82-2-751-6079 Kazakhstan Samsung Electronics Kazakhstan LLP (SEK), Almaty Tel: 7-3272-585-965 Samsung electronics annual report 2007 135
  • Page 138
    ...: 213-21-59-1029~30 Tunisia Samsung Electronics Co., Ltd. Tunis Office Tel:...57-1-642-0555 Panama Samsung Electronics Latino America S.A. (SELA), Panama City Tel: 50-7-210-1122 Peru Samsung Electronics Co., Ltd...: 905-542-3535 Mexico Samsung Electronics Mexico S.A. de C.V. (SEM), Mexico City Tel: 52-55-...
  • Page 139
    Published by Samsung Electronics Produced by Cheil Communications Created by The Third Age www.samsung.com
  • Page 140


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  • Samsung 2007 Annual Report - Page 1
    2007 Samsung electronics annual report
  • Samsung 2007 Annual Report - Page 2
    ... digital appliance semiconductor LCD 34 38 42 46 50 thinking more of you corporate citizenship co-prosperity green management financial statements investor information global network 56 58 60 63 130 131
  • Samsung 2007 Annual Report - Page 3
    ...2005 80,630 7,575 7,640 2006 85,426 9,008 7,926 2007 98,508 8,973 7,421 Balance Sheet Total Assets Total Liabilities ... be entirely assumed by you. All the financial data in this report comes from the consolidated financial statements. Samsung electronics annual report 2007 01
  • Samsung 2007 Annual Report - Page 4
    ...(loss) [in trillions of KRW ] [in millions of KRW ] 26.5 17.7 Digital Media 0.7 2006 20.8 2005 2006 2007 1.06 Net sales Operating profit ...KRW ] 2006 2007 [in millions of KRW ] 2005 2006 2007 Digital Appliance 5.6 5.5 6.9 Net sales \ 5,617,708 (29,102)...
  • Samsung 2007 Annual Report - Page 5
    ... a sixth consecutive year. In ongoing efforts to enhance our leadership, we also have begun mass producing the world's first touch-screen-enabled LCD. Samsung electronics annual report 2007 03
  • Samsung 2007 Annual Report - Page 6
    Message from the CEO By increasing management prowess and embracing innovation at every opportunity, Samsung Electronics will become one of the most profitable and most revered global companies.
  • Samsung 2007 Annual Report - Page 7
    ..., we focused on increasing our R&D workforce to strengthen its future contribution to our company and, as a result, the number of R&D engineers reached 39,000. Samsung electronics annual report 2007 05
  • Samsung 2007 Annual Report - Page 8
    ...As part of our goal of becoming a true upper-echelon global leader, Samsung Electronics will concentrate on further developing its innovative approaches to management with a focus on speed, efficiency and creativity, and generating new values through ...
  • Samsung 2007 Annual Report - Page 9
    ...promising model for becoming what I envision to be "the best of the best." Yoon-Woo Lee Vice Chairman and Chief Executive Officer Samsung Electronics Co., Ltd. Samsung electronics annual report 2007 07
  • Samsung 2007 Annual Report - Page 10
    ... and overall corporate value. We are also sustaining shareholder focused management to ensure that our profitable earnings and corporate values benefit our shareholders.... and Asset have rated Samsung again among the very best in terms of investor relations and corporate governance....
  • Samsung 2007 Annual Report - Page 11
    ... Co., Ltd. [Present] Vice Chairman, Corporate CTO & Global Collaboration, Samsung Electronics Co., Ltd., Vice Chairman, Samsung Advanced Institute of Technology ... [2003-2005] • Chairman, Korean Human Resources Management Institute [2002-2003] • Samsung electronics annual report 2007 09
  • Samsung 2007 Annual Report - Page 12
    ...No. 2 in 2006 for the number of U.S. R patents registered  chieved No. 1 market share for the sale of A mobile phones ...saving 256-channel  display driver for Plasma screens E xported 3G CDMA system to Indonesia ... Developed the world's first 65nm-class digital TV  receiver chip  argest number ...
  • Samsung 2007 Annual Report - Page 13
    ... year. World's No. 1 Market Share DisplaySearch, the worldwide authority in display market research, identified Samsung as the leader in unit share and ... monthly US$2 billion LCD panel S sales total for the first time • • • • Samsung electronics annual report 2007 11
  • Samsung 2007 Annual Report - Page 14
    ... preeminent market leadership. thinking In today's competitive world, if a company remains stagnant, it can quickly become obsolete. Consumers have many choices, ... our customers through the production and sale of world-class products and, most importantly, by anticipating their ...
  • Samsung 2007 Annual Report - Page 15
    ahead of you Samsung electronics annual report 2007 13
  • Samsung 2007 Annual Report - Page 16
    ... such as the digital TV, smart phone, music phone, video MP3 player, side-by-side refrigerator and drum washing machine. Supported by a sound ... a little girl, Sarah's dream was to be a world-famous rock star. With Samsung's LCD TV and Blu-ray DVD player, Sarah can record and ...
  • Samsung 2007 Annual Report - Page 17
    ... high image quality of our LCD TV with the latest Blu-ray player. And, watch your favorite movies for the first time as a completely new, high definition experience. Samsung electronics annual report 2007 15
  • Samsung 2007 Annual Report - Page 18
    .... Our premium products include the TOC monitor, Armani TV, J-Series refrigerator by Jasper Morrison, and a five-megapixel camera phone. Building on advanced technology with versatile features and stylish design, our innovative premium products will...
  • Samsung 2007 Annual Report - Page 19
    ... designed monitors provide you with the power and features to help drive your business well into the future. c BlackJack II (SGH-i617) Boost productivity whether you're in the office or on the road with the award-winning BlackJack II. Samsung electronics annual report 2007 17
  • Samsung 2007 Annual Report - Page 20
    ...emerging markets, including China, is a major opportunity for Samsung Electronics. With aggressive marketing and locally customized products, including digital media, mobile phones and home appliances, we are providing a more comfortable and...
  • Samsung 2007 Annual Report - Page 21
    ... trend in washing machines is our silent, but powerful, drum washing machine. From an attractive design to top-notch performance, this washing machine has it all. Samsung electronics annual report 2007 19
  • Samsung 2007 Annual Report - Page 22
    thinking thinking
  • Samsung 2007 Annual Report - Page 23
    ... of customers worldwide, which will propel our company and our brand well into the future. company in its annualInfo Tech 100. company in its annualInfo Tech 100. Samsung electronics annual report 2007 21
  • Samsung 2007 Annual Report - Page 24
    ... launching mobile phone and LCD TV lines, and worked with the world-famous industrial designer Jasper Morrison in designing mobile phones, side-by-side refrigerators and electric ranges. In addition, ... Time Warner Samsung Electronics partnered with Time Warner Cable, the second largest cable company ...
  • Samsung 2007 Annual Report - Page 25
    ... with our customers. Providing a Wide Range of Benefits for Worldwide Tourists Outstanding displays by Samsung ... phones and notebook PCs, free of charge, where electrical receptacles are lacking. Actively promoting ... technology. Samsung Experience at Time Warner Center in New York City Located in New ...
  • Samsung 2007 Annual Report - Page 26
    ... we provided our unique Wireless Olympic Works ( WOW ) service, a communications system designed to bring the power of mobile wireless technologies to the ...the Chelsea Football Club, Samsung Electronics will play a key part in its global development. Both brands share the same ...
  • Samsung 2007 Annual Report - Page 27
    ... in 2000. To promote e-sports, we operate Samsung Khan, a professional online game team. Nurturing Culture and Education Sponsoring a ... to share our passion with the world and contribute to the betterment of society. er ,C orporate Samsung electronics annual report 2007 Communications Team 25
  • Samsung 2007 Annual Report - Page 28
    ... division are responsible for commercializing products scheduled to hit the market within one or two years. Samsung Electronics operates six R&D centers in Korea and a total of... lives of our customers. At the end of 2007, 39,000 people were involved in the development of Samsung products...
  • Samsung 2007 Annual Report - Page 29
    ... paper (e-paper), delivering undistorted images even when the surface is bent. This flexible display does not require any electricity. 14.3-inch e-paper b c c Samsung electronics annual report 2007 27
  • Samsung 2007 Annual Report - Page 30
    a b
  • Samsung 2007 Annual Report - Page 31
    ... YP-S5 is an extremely portable multimedia device. Its full color screen makes watching videos a pleasure while its fold-out speakers are powered by ... The device attaches to a mobile network connection and is designed to enhance coverage for the home. b c Samsung electronics annual report 2007 29
  • Samsung 2007 Annual Report - Page 32
    ... powerful multimedia device comes fully equipped with a five megapixel camera and a 3.2-inch, 16:9 wide touch screen. Plus, it is built with Samsung's award-winning Croix user interface, enabling greater convenience and ease of use. ...
  • Samsung 2007 Annual Report - Page 33
    ... Hanover honored 26 Samsung products, including LCD TVs, mobile phones, note PCs, and laser printers... Gold Prize for our side-byside refrigerator. Samsung's Ultra Edition II mobile phone and portable DMB TV received ...i Unit gn er ], Corporate Samsung electronics annual report 2007 Design 31 Center
  • Samsung 2007 Annual Report - Page 34
    .... thinking Like modern-day pioneers, Samsung Electronics has opened doors to new worlds through our innovative products and... fostering more strategic alliances, and delivering an unrivaled customer experience, Samsung has catapulted itself to the forefront of efforts to enhance consumer lifestyles, ...
  • Samsung 2007 Annual Report - Page 35
    smarter for you Samsung electronics annual report 2007 33
  • Samsung 2007 Annual Report - Page 36
    digital media
  • Samsung 2007 Annual Report - Page 37
    .... 26.5 20.8 17.8% 7.4 2006 2007 2006 10.6 2007 WORLDWIDE TV MARKET SHARE IN 2007 [By Sales] [KRW trillion] SALES [KRW hundreds of billion] ... we were also honored with an iF Design Award for the quality of a wide range of our digital media products. Samsung electronics annual report 2007 35
  • Samsung 2007 Annual Report - Page 38
    ... the world's largest (70-inch) Full HD LCD TV Samsung Electronics introduced the world's largest, commercially available Full HD LCD TV. It... profits after converting all exported notebook PCs to the Samsung brand last year. In 2008, with a wide range of new products, such as ...
  • Samsung 2007 Annual Report - Page 39
    ... of the Year" in the Display Technology category of the VARBusiness Annual Report Card (ARC), recognizing Samsung... the No. 2 market share globally with these innovative players. The Samsung digital cameras, backed ... to add more freedom to anyone's lifestyle. Samsung electronics annual report 2007 37...
  • Samsung 2007 Annual Report - Page 40
    telecommunication networks
  • Samsung 2007 Annual Report - Page 41
    ... and Sound Association ( EISA) Awards and "Phone of the Year" at the Mobile Choice Award, securing our reputation for providing the world's best mobile phones. Samsung electronics annual report 2007 39
  • Samsung 2007 Annual Report - Page 42
    ...research conducted by Brand Keys, a U.S. market research company, Samsung was selected as the most favored mobile phone brand for the sixth year in a row... phone lineup with multimedia phones that include a full touch screen user interface and enhanced versions of Samsung Soul, our worldwide flagship ...
  • Samsung 2007 Annual Report - Page 43
    ..., we launched the Giorgio Armani Samsung mobile (SGH-P520). The touch screen model features cutting-edge phone technology, such as a three ... convergence will further bolster our mobile communication brand as the industry takes mobility to the next level. Samsung electronics annual report 2007 41
  • Samsung 2007 Annual Report - Page 44
    digital appliance
  • Samsung 2007 Annual Report - Page 45
    ... in Germany. In Korea, we also placed first in the 2007 National Customer Satisfaction Index (NCSI) in the refrigerator, washing machine and air conditioner categories. Samsung electronics annual report 2007 43
  • Samsung 2007 Annual Report - Page 46
    ...-Side Refrigerators Since side-by-side refrigerators were introduced in Korea in 1997, Samsung Electronics has led the.... Also in 2007, J.D. Power and Associates awarded our side-by-side refrigerators its "Highest Customer Satisfaction" rating for the third straight year. In 2008, Samsung Electronics'...
  • Samsung 2007 Annual Report - Page 47
    ... 4 Highest Customer Satisfaction rat- ing by J.D. Power Samsung's side-by-side refrigerators received the "Highest Customer Satisfaction" rating for the third year in a ... to the conventional oven, grill and microwave, as well as dry heat and fermenting. Samsung electronics annual report 2007 45
  • Samsung 2007 Annual Report - Page 48
    semiconductor
  • Samsung 2007 Annual Report - Page 49
    ... with continued market dominance in most areas of the memory business, including strong sales in DRAM, SRAM, MCPs, flash memory and fusion memory devices. Samsung electronics annual report 2007 47
  • Samsung 2007 Annual Report - Page 50
    ... Leadership In 2007, Samsung Electronics easily held on to its No. 1 position in the memory industry with 28% ... and mobile devices. We also succeeded in producing the world's first 60nm-class ... memory products are expected to account for an increasingly major part of the Samsung memory business over ...
  • Samsung 2007 Annual Report - Page 51
    ...16M-color display driver IC (DDI) for active-matrix OLED (AMOLED) displays used in mobile phones and other... the HDD market, Samsung Electronics produces high-capacity hard drives for both mobile devices and ... more durable, quieter, and more energy efficient. Samsung electronics annual report 2007 49
  • Samsung 2007 Annual Report - Page 52
    LCD
  • Samsung 2007 Annual Report - Page 53
    ... industry in a wide variety of applications. In 2007, Samsung Electronics was ranked No. 1 in display panels for TVs, desktop monitors and notebook PCs, achieving a ... globally for six consecutive years, ensuring our continued leadership in the LCD industry. Samsung electronics annual report 2007 51
  • Samsung 2007 Annual Report - Page 54
    ...or greater. Small- and Mid-sized Panels We are producing a wide range of AMOLED sizes for premium mobile multimedia devices. The displays use Samsung's proprietary amorphous silicon gate technology and their production has reduced the mobile panel...
  • Samsung 2007 Annual Report - Page 55
    ...introduced next-generation standards for color displays and black-and-white e-paper, plus several commercial sizes of AMOLEDs as we continue to accelerate...such aggressive expansion efforts, we will consolidate our status as the world's leading LCD producer. Samsung electronics annual report 2007 53
  • Samsung 2007 Annual Report - Page 56
    ... lies beyond them. thinking Making industry-leading products is only part of the big picture. Our commitment ...nurturing our local communities through corporate social responsibility and co-prosperity initiatives. Samsung has also remained steadfast when it comes to supporting education initiatives, ...
  • Samsung 2007 Annual Report - Page 57
    more of you Samsung electronics annual report 2007 55
  • Samsung 2007 Annual Report - Page 58
    Corporate Citizenship We share with all communities our hope for a brighter future, and try each day to make ... each of our eight major volunteer centers and have collaborated on a wide range of programs with Samsung Community Relations, the Samsung Group's social contribution organization. In 2007, ...
  • Samsung 2007 Annual Report - Page 59
    ...surgery for patients in need, were highly praised by the communities they served. In 2007, the Guangming Daily awarded Samsung Electronics, for the third...our employees contributed a portion of their salaries to further our corporate citizenship initiatives. Samsung electronics annual report 2007 57
  • Samsung 2007 Annual Report - Page 60
    ... participation through Samsung Partners' Day, inviting hundreds of executives to share management goals ... Office under the CEO to drive more efficient and rewarding win-win alliances... to improve business management controls internally by sharing transaction information with Samsung Electronics in real...
  • Samsung 2007 Annual Report - Page 61
    ...Partner Companies" event, attended by 196 partner companies and our employees. At the event, our partners presented a wide range of innovative ideas to sharpen our mutual leadership in technology while enhancing the cohesiveness of our partnerships. Samsung electronics annual report 2007 59
  • Samsung 2007 Annual Report - Page 62
    ...for our people and planet. green Green Management Initiative to be a Global Standard Building upon Samsung's philosophy of contributing to a better ... set up their own environmental quality management systems. Minimizing the Environmental Impact Samsung Electronics is developing cleaner production ...
  • Samsung 2007 Annual Report - Page 63
    ... leader of environment initiatives to address global warming, Samsung Electronics introduced the "Catch CO2 Project" in 2002, a voluntary initiative to reduce ... able to provide further information on our product-related environmental policies .and programs. Samsung electronics annual report 2007 61
  • Samsung 2007 Annual Report - Page 64
  • Samsung 2007 Annual Report - Page 65
    ... Statements of Cash Flows Consolidated Five-year Financial Summary 66 68 69 73 75 Notes to the Consolidated Financial Statements 77 Investor Information Global Network 132 133 Samsung electronics annual report 2007 63
  • Samsung 2007 Annual Report - Page 66
    ... audits. We did not audit the financial statements of Samsung Card Co., Ltd. and ... supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting ... in Note 18 to the accompanying consolidated financial statements, Samsung Electronics Co., Ltd. ("SEC...
  • Samsung 2007 Annual Report - Page 67
    ...consolidated financial statements. Accounting principles and auditing standards and their application in practice..., the procedures and practices used in the Republic of Korea to audit such financial statements may... subsequent events or circumstances, if any. Samsung electronics annual report 2007 65...
  • Samsung 2007 Annual Report - Page 68
    ... financial instruments (Note 4) Short-term available-for-sale securities (Note 5) Short-term held-to-maturity securities (Note 5) Trade accounts and notes receivable, net of allowance for doubtful accounts (Note 6) Other accounts and notes ...
  • Samsung 2007 Annual Report - Page 69
    ... (Note 3)) Liabilities and Shareholders' Equity Current liabilities Trade accounts and notes payable Short-term borrowings (Note 13) Current ... 86,744,356 The accompanying notes are an integral part of these consolidated financial statements. Samsung electronics annual report 2007 67
  • Samsung 2007 Annual Report - Page 70
    ... (Note 24) Net income Controlling interests Minority interests Basic earnings per share (Note 25) (in Korean won and U.S. dollars)... (in Korean won and U.S. dollars) ₩ The accompanying notes are an integral part of these consolidated financial statements.
  • Samsung 2007 Annual Report - Page 71
    ...,574 20,082 355,350 ₩ 897,514 ₩ 6,364,604 ₩ (6,994,210) ₩ 532,820 ₩ 44,463,683 ₩ 2,675,456 ₩ 47,939,867 continued Samsung electronics annual report 2007 69
  • Samsung 2007 Annual Report - Page 72
    ... Changes in Shareholders' Equity Years Ended December 31, 2007 and 2006 (In millions of Korean won) Capital Stock ... valuation of equity-method investments Translation of foreign currency financial statements Others Shareholders' equity, December 31, 2007 Capital Surplus Accumulated Other ...
  • Samsung 2007 Annual Report - Page 73
    ... 378,838 $  956,838 $   6,785,292 $ (7,456,514) $  568,038 $ 47,402,647 $  2,852,299 $ 51,108,600 continued Samsung electronics annual report 2007 71
  • Samsung 2007 Annual Report - Page 74
    ... equity-method investments Translation of foreign currency financial statements Others Shareholders' equity, December 31, 2007 Capital Surplus Accumulated Other Capital ...440,484 $ 4,590,854 $ 59,671,544 The accompanying notes are an integral part of these consolidated financial statements.
  • Samsung 2007 Annual Report - Page 75
    ... net cash provided by operating activities Depreciation and amortization Provision for severance benefits Loss on transfer of trade accounts and notes receivable Bad debt ... 3,228,654 (1,964,136) 601,296 3,964,091 (3,963,921) continued Samsung electronics annual report 2007 73
  • Samsung 2007 Annual Report - Page 76
    Consolidated Statements of Cash Flows Years Ended December 31, 2007 and 2006 (...Decrease (increase) in other accounts and notes receivable Proceeds from disposal of property, plant and ...4,352,683 4,501,095 The accompanying notes are an integral part of these consolidated financial statements.
  • Samsung 2007 Annual Report - Page 77
    ... 70 520 0 9,828 11.5% 1,634 (268) 7,926 9.3% 2007 98,508 70,881 27,627 28% 18,654 8,973 9.1% 660 171 378 0 9,633 9.8% 1,710 (502) 7,421 7.5% continued Samsung electronics annual report 2007 75
  • Samsung 2007 Annual Report - Page 78
    ...Debt to Equity Net Debt / Equity Earnings per share (KRW) * Cash & Cash Eq. includes short-term financial instruments 2003 21... and thus may be different from those in audited financial statements. Financial sectors are included in the consolidated base financial statements ...
  • Samsung 2007 Annual Report - Page 79
    ... is the sum of the percentage of direct and indirect ownership. The consolidated financial statements include the accounts of the consumer financing subsidiary, Samsung Card Co., Ltd., in accordance with the consolidation accounting standards...
  • Samsung 2007 Annual Report - Page 80
    ... 50.63 83.33 100.00 100.00 50.00 100.00 Location Korea Korea Korea... Korea Korea Korea Samsung Gwangju Electronics Co., Ltd. Home appliances manufacturing Samsung Card Co., ...of electronic goods and mobile phone 100.00 U.S.A continued 1. As of June 27, 2007, Samsung Card ...
  • Samsung 2007 Annual Report - Page 81
    ....00 100.00 100.00 100.00 Slovakia Israel Russia Poland Samsung Electronics Holding GmbH (SEHG) Holding company (financing) Samsung ...00 South Africa 100.00 Slovakia continued Samsung Electronics Slovakia s.r.o. (SESK) Monitor manufacturing Samsung electronics annual report 2007 79
  • Samsung 2007 Annual Report - Page 82
    Notes to the Consolidated Financial Statements continued (In millions of Korean won) Subsidiaries Samsung Electronics Overseas B.V. (SEO) LLC Samsung Electronics Rus Company (SERC) LLC Samsung Russia Service Center (SRSC) Samsung Japan Corporation (SJC) ...
  • Samsung 2007 Annual Report - Page 83
    ...) Service Samsung Electronics Huizhou Co., Ltd. (SEHZ) A/V manufacturing Tianjin Samsung Electronics Display Co., Ltd. (TSED) Monitor manufacturing Souzhou Samsung Electronics Co., ....00 China 100.00 China 100.00 China 100.00 China 70.00 China Samsung electronics annual report 2007 81
  • Samsung 2007 Annual Report - Page 84
    ...of subsidiaries as of and for the year ended December 31, 2007, included in the consolidated financial statements follows: (In millions of Korean won) Subsidiaries Assets Liabilities Samsung Gwangju Electronics Co., Ltd. ₩ Samsung ...
  • Samsung 2007 Annual Report - Page 85
    ...Semiconductor sales In accordance with consolidation accounting standards generally accepted in the Republic of Korea, the financial statements of the above subsidiaries ... excluded from the consolidated financial statements for the year ended December 31, 2007, are as follows: Location Name of ...
  • Samsung 2007 Annual Report - Page 86
    ... The significant accounting policies followed by the Company in the preparation of its consolidated financial statements are summarized below: ... and Supervisory Board. As SKFAS No. 11, No. 21 and No. 24 ..., Preparation and Presentation of Financial Statements (Financial Industry), Samsung Card Co., Ltd...
  • Samsung 2007 Annual Report - Page 87
    ... of operations. Certain equity-method investments are accounted for based on unaudited or unreviewed financial statements as the audited or reviewed financial statements of these.... A new basis for calculating depreciation is established for revalued assets. Samsung electronics annual report 2007 85
  • Samsung 2007 Annual Report - Page 88
    Notes to the Consolidated Financial Statements continued Depreciation is computed using the straight-line method over the following estimated ... of the countries in which they operate. In translating the foreign currency financial statements of these subsidiaries into Korean won, income and expenses ...
  • Samsung 2007 Annual Report - Page 89
    ... each other. Long-Term Receivables and Payables Long-term receivables and ... is made in the notes to the financial statements. Derivative Instruments Derivative financial instruments for trading or hedging ... as an asset impairment loss in the current period. Samsung electronics annual report 2007 87...
  • Samsung 2007 Annual Report - Page 90
    Notes to the Consolidated Financial Statements continued 3. United States Dollar Amounts The Company operates primarily ...-sponsored research and development projects Other activities Long-term financial instruments Special deposits Other activities 2007 35,632 34,548 70,...
  • Samsung 2007 Annual Report - Page 91
    ... securities as of December 31, 2007 and 2006, consist of the following: (In millions of Korean won) Government and public bonds ₩ 2007 130 ₩ 2006 248 Samsung electronics annual report 2007 89
  • Samsung 2007 Annual Report - Page 92
    Notes to the Consolidated Financial Statements continued 6. ACCOUNTS AND NOTES RECEIVABLE Accounts and notes receivable, and their allowance...885 ₩ 2006 4,002,923 From 2003 to 2005, Samsung Card Co., Ltd. transferred credit card receivables and financial assets to SangRokSoo 1st Securitization...
  • Samsung 2007 Annual Report - Page 93
    ... millions of Korean won) Accounts Short-term financing receivables Credit card assets Lease assets... Less: Allowance for doubtful accounts Long-term financing receivables Credit card assets Lease assets...449,031) 3,806,535 8,393,507 Samsung electronics annual report 2007 91
  • Samsung 2007 Annual Report - Page 94
    Notes to the Consolidated Financial Statements continued Collection schedule of installment finance and general loans as of December ... won) Automobiles Electronic system Less: Accumulated depreciation Accumulated impairment losses Operating lease assets ₩ 2007 867,157 12,...
  • Samsung 2007 Annual Report - Page 95
    ...following: (In millions of Korean won, except for the number of shares and percentage) 2007 Number of Shares Owned Related parties Samsung Heavy Industries Co., Ltd. 40,675,641 Samsung Fine Chemicals Co., Ltd. 2,969,730 The ...
  • Samsung 2007 Annual Report - Page 96
    ... of the following: (In millions of Korean won, except for the number of shares and percentage) 2007 Number of Shares Owned Related parties Samsung Petrochemical Co., Ltd. 514,172 Samsung General Chemicals Co., Ltd. 1,914,251 Samsung ...
  • Samsung 2007 Annual Report - Page 97
    ... Co., Ltd. declined significantly, the difference between the book value and recoverable amount amounting to ₩20,700 million was charged to impairment loss. Samsung electronics annual report 2007 95
  • Samsung 2007 Annual Report - Page 98
    Notes to the Consolidated Financial Statements continued The maturities of long-term held-to-maturity securities as of December ... Investee Shares Owned Ownership (%) Cost Book Value Book Value Samsung SDI ... Co., Ltd. Shanghai Bell Samsung Mobile Communications Co., Ltd. eSamsung Greater...
  • Samsung 2007 Annual Report - Page 99
    ... - - 294 49.00 49.00 49.03 ₩ 2,061 7,742 150,451 1,911,229 3,683 4,458 19,926 ₩ 3,445,782 3,356 3,233 50,518 ₩ 3,393,617 Samsung electronics annual report 2007 97
  • Samsung 2007 Annual Report - Page 100
    Notes to the Consolidated Financial Statements continued Changes in goodwill (negative goodwill) for the years ended... SDS Co., Ltd. Samsung Networks Inc. ₩ 2006 Property, Plant and Equipment... Co., Ltd. Shanghai Bell Samsung Mobile Communications Co., Ltd. Others ₩   6,593...
  • Samsung 2007 Annual Report - Page 101
    ...116,075 11,945 - 128,020 104,520 11,555 - 116,075 Samsung SDI (Malaysia) Sdn.Bhd. 27,679 (6,325) 1,992 23,346 ... 3,393,617 ₩ 377,626 ₩ 11,170 ₩ 3,782,413 ₩ 2,923,314 ₩ 519,661 ₩   Samsung electronics annual report 2007 99
  • Samsung 2007 Annual Report - Page 102
    Notes to the Consolidated Financial Statements continued Financial information of investees as of and for the years ended ...36,104 207,830 28,500 Samsung Corning Precision Glass Co., Ltd.... which are included in the shareholders' equity. On December 28, 2007, Samsung Corning Co., Ltd. merged ...
  • Samsung 2007 Annual Report - Page 103
    ...following investees: (In millions of Korean won) Location Subsidiaries Percentage of Ownership (%) ¹ Reason Korea Samsung Everland Inc. Allat ¹ International Cyber...696,162) 11,932 (242,078) ₩ 1,166,098 ₩ 33,784,615 Samsung electronics annual report 2007 101
  • Samsung 2007 Annual Report - Page 104
    Notes to the Consolidated Financial Statements continued In accordance with the Asset Revaluation Law, on January 1, 1980, 1982, 1998 and ... as collaterals for various loans from financial institutions. As of December 31, 2007, property, plant, equipment are insured against fire and other casualty ...
  • Samsung 2007 Annual Report - Page 105
    ... (In millions of Korean won) Annual Interest Rates (%) as of December 31, 2007 Overdraft General term loans from commercial banks Notes discounted - 5.6... debts of ₩1,933,885 million (2006: ₩2,722,010 million) as of December 31, 2007. Samsung electronics annual report 2007 103
  • Samsung 2007 Annual Report - Page 106
    ... of the following: (In millions of Korean won) Annual Interest Rates (%) as of December 31, 2007 Korea Energy Management Corporation Samsung Shinhan 4th Special Purpose Company Shinhan Bank and others 4.5 - 5.8 ~ 6.1 ₩ ...
  • Samsung 2007 Annual Report - Page 107
    ..., 2007 and 2006, consist of the following: (In millions of Korean won) Annual Interest Rates (%) as of December 31, 2007 Non-guaranteed debentures 2.68 ~ 8.5 ₩ 2007 4,337...725,000 ₩ 1,752,645 1,611,300 400,199 17,261 64,303 3,845,708 Samsung electronics annual report 2007 105
  • Samsung 2007 Annual Report - Page 108
    Notes to the Consolidated Financial Statements continued 15. Foreign Currency Notes and Bonds Unsecured foreign currency notes and bonds ... date of issuance. (B) US dollar floating rate notes US dollar floating rate notes issued by Samsung Card Co., Ltd., one of SEC's domestic subsidiaries, will be ...
  • Samsung 2007 Annual Report - Page 109
    ... currency exchange rates. As of December 31, 2007, the Company funded 60.7% of severance payable through severance insurance deposits with Samsung Life Insurance Co., Ltd. and Samsung...,328 455,848 134,440 1,638 - - 929,077 1,342,932 39,145 146,875 Samsung electronics annual report 2007 107
  • Samsung 2007 Annual Report - Page 110
    ... liable for guarantees amounting to $21.6 million undertaken by Citi Bank relating to the guarantees for Samsung Electronics Latinoamerica (Zona Libre), S.A., one... a US$25 million guarantee for Samsung Electronics Hungarian RT. Co., Ltd. relating to the investment incentive contract with the ...
  • Samsung 2007 Annual Report - Page 111
    ... its affiliates and subsidiaries with Korea Export Insurance Corporation. ( G) As of December 31, 2007, the Company has forward exchange contracts to manage the exposure to changes in ... impact of changes in the fair-value risk on fixed rate long-term debt. Samsung electronics annual report 2007 109
  • Samsung 2007 Annual Report - Page 112
    Notes to the Consolidated Financial Statements continued A summary of derivative transactions as of and for the year ended December 31, 2007 and... other claims and proceedings pending as of December 31, 2007, the Company's management believes that, although the outcome of these matters is uncertain, ...
  • Samsung 2007 Annual Report - Page 113
    ... for bank borrowings and for the fulfillment of certain contracts, which do not have a direct adverse effect on the operations or financial position of the Company. Samsung electronics annual report 2007 111
  • Samsung 2007 Annual Report - Page 114
    Notes to the Consolidated Financial Statements continued (N) A domestic subsidiary of the Company, Samsung Card Co., ..., subject to the Board of Directors' approval, to issue shares of common or preferred stock to investors other ...Stock Number of Shares of GDR 7,695,272 4,251,339 15,390,544 8,502,...
  • Samsung 2007 Annual Report - Page 115
    ... 167,749 2,000,000 6,660,814 36,608,458 7,855,225 ₩ 44,463,683 1. The Commercial Code of the Republic of Korea requires SEC to ... is no longer required to further accumulate reserve and removed the restrictions on the usage of the existing reserve. Samsung electronics annual report 2007 113
  • Samsung 2007 Annual Report - Page 116
    ...dividends and year-end dividends are as follows: (A) Interim Dividends Number of shares eligible for dividends Common stock Preferred stock Dividend rate... amount Common stock Preferred stock 2007 (In millions of Korean won and number of shares) 2006 128,758,653 shares 20,253...
  • Samsung 2007 Annual Report - Page 117
    ... has granted 120,472 shares including 45,472 shares, which had been granted by Samsung Capital Co., Ltd. as part of the merger in 2004. The... to SEC's ownership ratio are included in a separate component of shareholders' equity as other capital adjustments. Samsung electronics annual report 2007 115
  • Samsung 2007 Annual Report - Page 118
    Notes to the Consolidated Financial Statements continued 24. Income Tax The statutory income tax rate applicable to the Company, including resident surtax... to the actual amount of taxes recorded by the Company for the years ended December 31, 2007 and 2006: (In millions ...
  • Samsung 2007 Annual Report - Page 119
    ... ₩ (399,886) (755,003) (1,456) (753,547 334,032 ₩ 1,533,307 ₩ (1,199,275) 306,323 791,219 20,090 787,929 286,233 3,290 Samsung electronics annual report 2007 117
  • Samsung 2007 Annual Report - Page 120
    Notes to the Consolidated Financial Statements continued Deferred income tax assets and liabilities ...909,804 ₩ 78,318 Deferred tax relating to items charged to equity ₩ (757,513...,899 ₩ 1,462,134 ₩ (829,235) The Company periodically assesses its ability to recover deferred...
  • Samsung 2007 Annual Report - Page 121
    ... the year ended December 31, 2006, presented herein for comparative purposes, have not been restated as permitted under the Korea Accounting Institute Opinion 06-2. Samsung electronics annual report 2007 119
  • Samsung 2007 Annual Report - Page 122
    Notes to the Consolidated Financial Statements continued 25. Earnings Per Share Earnings per ...and number of shares) Net income as reported on the statements of income Adjustments: Dividends for preferred stock.../365 1,494,909 2006 Number of shares Stock options 1,888,379 Weight ...
  • Samsung 2007 Annual Report - Page 123
    ... 20,082 (156,147) (3,734) ₩ 9,541,679 ₩ 8,314,380 ₩ 8,763,144 ₩ 8,013,574 778,535 300,806 ₩ 9,541,679 ₩ 8,314,380 Samsung electronics annual report 2007 121
  • Samsung 2007 Annual Report - Page 124
    Notes to the Consolidated Financial Statements continued 27. Related Party Transactions (A) Significant transactions between ... and 2006, and the related receivables and payables as of December 31, 2007 and 2006, ... 14,179 418,026 5,689,401 1 Payables 2007 2006  164,459 ₩ 244,467...
  • Samsung 2007 Annual Report - Page 125
    ... 86,296 ₩ 127,143 ₩ 406,364 ₩ 356,168 ₩ 4,395,838 ₩ 4,842,841 ₩ 92,145 ₩ 94,321 ₩ 462,717 ₩ 473,930 Samsung electronics annual report 2007 123
  • Samsung 2007 Annual Report - Page 126
    ...,630 ₩ 333,796 ₩ 499,446 Cheil Communications Inc. Samsung Everland Co., Ltd. Samsung Heavy Industries Co., Ltd. Samsung Fire & Marine Insurance Co., Ltd. Samsung America Inc. Samsung Deutschland GmbH Others ...
  • Samsung 2007 Annual Report - Page 127
    ... insurance plan with Samsung Life Insurance Co., Ltd., and fire and other insurance policies with Samsung Fire & Marine Insurance Co., Ltd. In ... who have the authority and responsibility in the planning, directing and controlling of Company operations. Samsung electronics annual report 2007 125
  • Samsung 2007 Annual Report - Page 128
    Notes to the Consolidated Financial Statements continued 28. Research and Development Costs Research ... currencies in thousands) Foreign Companies Domestic Companies 2007 2006 Account Foreign Foreign... 451,097 Others 2,836,363 Trade accounts and US$ 1,458,416...
  • Samsung 2007 Annual Report - Page 129
    ...906 EUR 854,414 Others Long-term other US$ 100,000 accounts payable Others Foreign currency notes and bonds (including current portions... 2007, amounted to ₩128,577 million and ₩122,597 million, respectively. Samsung electronics annual report 2007 127
  • Samsung 2007 Annual Report - Page 130
    ...520 1,791 362,274 90,404 271,870 ₩ ₩ ₩ ₩ ₩ ₩ The above consolidated financial statements of the non-financial business include the financial service subsidiary which is accounted for using the equity method.
  • Samsung 2007 Annual Report - Page 131
    ... profit of each segment is inclusive of all consolidation eliminations. The presentation and classification of 2006 was revised for comparability with 2007 presentation. Samsung electronics annual report 2007 129
  • Samsung 2007 Annual Report - Page 132
    Notes to the Consolidated Financial Statements continued Operating data of entities classified according to geographic area as of and ... ended December 31, 2007: (In millions of Korean won) 2007 Summary of Business by Geographic Area Korea Domestic Export Gross sales Intersegment sales...
  • Samsung 2007 Annual Report - Page 133
    ... Financial Statements The consolidated financial statements as of and for the year ended December 31, 2007, were approved by SEC's Board of Directors on March 4, 2008. Samsung electronics annual report 2007 131
  • Samsung 2007 Annual Report - Page 134
    ... consequential, special, or similar damages. ADDITIONAL INFORMATION The 2007 Samsung Electronics Annual Report and the latest investor information are available online at www.samsung.com/ir. You may also contact us at [email protected]...
  • Samsung 2007 Annual Report - Page 135
    ... Samsung Electronics Southeast Asia Headquarters 3 Church Street #26-02 Samsung Hub, Singapore 049483, Singapore PRODUCTION NETWORK KOREA Suwon Complex 416, Maetan 3-dong, Yeongtong-gu, ...-dong, Gumi Gyeongsangbuk-do Tel: 82-54-479-5114 Fax: 82-54-479-5058 Samsung electronics annual report 2007 133
  • Samsung 2007 Annual Report - Page 136
    ...: 86-512-6253-8988 (6688) Samsung Electronics Suzhou LCD Co., Ltd...-22-2532-1234 Tianjin Samsung Electronics Display (TSED), Tianjin Tel: 86...-8396-9600 Tianjin Tongguang Samsung Electronics Company (TTSEC), Tianjin Tel: 86...-21-8983-7114 Malaysia Samsung Electronics Display (M) SDN. BHD. (SDMA), Seremban...
  • Samsung 2007 Annual Report - Page 137
    ... Vina Electronics Co., Ltd. (SAVINA), Ho Chi Minh City Tel: 84-8-896-5500 EUROPE Austria Samsung Electronics Austria Gmbh (SEAG), Vienna Tel: 43-1-... Office Tel: 82-2-751-6079 Kazakhstan Samsung Electronics Kazakhstan LLP (SEK), Almaty Tel: 7-3272-585-965 Samsung electronics annual report 2007 135
  • Samsung 2007 Annual Report - Page 138
    ...: 213-21-59-1029~30 Tunisia Samsung Electronics Co., Ltd. Tunis Office Tel:...57-1-642-0555 Panama Samsung Electronics Latino America S.A. (SELA), Panama City Tel: 50-7-210-1122 Peru Samsung Electronics Co., Ltd...: 905-542-3535 Mexico Samsung Electronics Mexico S.A. de C.V. (SEM), Mexico City Tel: 52-55-...
  • Samsung 2007 Annual Report - Page 139
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  • Samsung 2007 Annual Report - Page 140