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Samsung's investment stagnant amid lackluster earnings

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(Globalpost/GlobalPost)

SEOUL, Aug. 6 (Yonhap) -- South Korea's biggest conglomerate Samsung Group said Wednesday its combined annual investment in facilities and research will remain flat from a year earlier, apparently as the group's mainstay Samsung Electronics Co. refrains from huge expenditures amid weak earnings.

"Although we collect investment data from all affiliates, such information is classified," an official from Samsung said. "But the amount is anticipated to hover around 50 trillion won (US$48.5 billion)."

The business group is estimated to have spent 48 trillion won in 2013 on its facilities and development projects, up from the 45 trillion won a year earlier. Its investment came to 42 trillion won in 2011.

Industry watchers said the conglomerate's stagnant investment apparently came as the heightening market competition and falling profits have curtailed spending for Samsung Electronics.

Last month, the world's No. 1 smartphone maker said it will invest 24 trillion won in its facilities this year, with 14.4 trillion won anticipated to go to its semiconductor business. The annual figure only marked a 1 percent rise from the 23.7 trillion won last year.

When taking research and development projects into account, the tech arm's combined annual investment is expected to reach 39 trillion won, taking up 80 percent of the group's investment.

Samsung Electro-Mechanics Co., Samsung SDI Co., Samsung SDS Co. and Samsung Biologics Co. are also some of the group's main affiliates that will roll out investment projects in 2014.

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http://www.globalpost.com/dispatch/news/yonhap-news-agency/140805/samsungs-investment-stagnant-amid-lackluster-earnings