Samsung 2007 Annual Report Download - page 7

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We are determined to reach the highest echelon of global business leadership, even in the
face of today’s challenging global and domestic business conditions. Through our management’s
pursuit of innovative approaches, processes and product designs and accelerated
cost-reduction efforts, we achieved our highest-ever record for consolidated sales in 2007,
surpassing US$100 billion (KRW98 trillion), and attaining a net profit of KRW7.4 trillion.
In 2008, we will continue to increase our competitiveness in key businesses, while
developing new markets and businesses and laying a firm foundation for sustainable growth
through the pursuit of greater operational efficiency. Moreover, by promoting innovative
management practices that optimize the speed, efficiency and creativity of our workforce,
we will generate additional value and establish ourselves as a true leader in the top tier
of the world’s electronics industry. In defining success, we are determined to transform ourselves
into one of the most respected, trusted and easily recognized global companies in the world.
Dear Customers, Business Partners and Shareholders:
I am extremely pleased to take this opportunity to discuss our 2007 achievements, as well as our future goals
and strategies. Samsung Electronics achieved its best ever business results in 2007, moving one step closer to
our dream of becoming one of only a handful of companies who are not only tremendously successful, but
also true global innovators. I would like to express my heartfelt gratitude to all of our customers, business
partners and shareholders who have supported us in accomplishing such excellent results.
2007 RESULTS AND ANALYSIS
We achieved our best-ever business results through a series of innovative management approaches
In 2007, at a time when the global economy was hampered by sharp increases in oil prices, as well as the
soaring cost of raw materials and unstable capital markets influenced by the U.S. subprime mortgage crisis.
Concurrently, the Korean economy continued to undergo difficulties caused by sluggish consumption, unstable
currency exchange rates and rising interest rates. Amidst these unfavorable business conditions, Samsung
Electronics achieved record-breaking consolidated sales of US$100 billion (KRW98 trillion). We also achieved
solid earnings of KRW7.4 trillion in net profit thanks to an upward turn in profitability for our key strategic
businesses and steady progress in our efforts to diversify further.
Strengthening dominance in key strategic businesses
In 2007, our semiconductor business continued to yield substantial profits of over KRW2 trillion. This strong
showing was based on extensive cost reduction efforts, increased market differentiation in our areas of greatest
technological competence and concerted efforts to retain a stable customer base, despite aggravated conditions
in the memory market. Also, we maintained the highest profitability among LCD manufacturers around the
world by cutting production costs and improving production operations as favorable conditions continued to
support high LCD prices, further increasing our dominance in the large TV panel market. Meanwhile, in the
mobile phone segment, we launched a wide range of new products and have actively sought alternative markets,
thus achieving a sales increase of over 40 percent, compared to the previous year, allowing us to capture second
place in the global market. Our overall TV business has maintained its No. 1 position in global sales since
2006, widening the gap with our competition.
Reinforcing our core competence
Since 2004, when our company announced its vision of leaping into the top tier of global leadership, Samsung
Electronics has continued its unrelenting drive to differentiate the three main elements of our core competence:
human resources, technology and brand image. Last year, 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.