Mirae Asset Securities predicted on 7th that Samsung Securities would have recorded an 'earnings shock' below market expectations for the fourth quarter (October to December) of last year.
Jung Tae-jun, a researcher at Mirae Asset Securities, estimated that Samsung Securities' net profit attributable to the controlling shareholders for the fourth quarter of last year would be 23.8% lower than market consensus. He noted, "The large foreign exchange gains recognized by Samsung Securities in the third quarter of last year likely turned into foreign exchange losses due to the rapid depreciation of the won," adding, "Other losses, such as impairment losses on overseas assets, are also expected to be reflected."
The researcher also stated, "While brokerage commission revenue is expected to have grown compared to the previous quarter due to Samsung Securities' high share of overseas stocks, the interest income is expected to continue declining due to the sluggish domestic stock market, thus remaining at a similar level to the last quarter."
The researcher projected that Samsung Electronics would distribute 3,500 won in dividends per common share at the end of the fourth quarter. However, the recent drop in dividends (-8.1%) exceeded the anticipated dividend yield (7.3%). The researcher assessed, "This is seen as a reflection of concerns over the decline in net profit attributable to the controlling shareholders of Samsung Securities," and added, "This year, the net profit attributable to the controlling shareholders of Samsung Securities is expected to decrease by 5.9% compared to last year, as one-off factors such as profits related to equity-linked securities (ELS) disappear."