Samsung Electronics

September, 2001
 Contents

Company Overview

Q2 2001 Results

Divisional Highlights
Company Overview
Organizational Structure

Vice Chairman & CEO (Yun, Jong Yong)

CTO (Yun, Jong Yong) ◀ ▶ CFO (Choi, Doh Seok)

Semiconductor Info. & Comm Digital Media Sys. Living Appliances

Lee, Yoon Woo Lee, Ki Tae Chin, Daeje Han, Yong Oe

▶ Memory ▶ Handsets ▶ Monitor ▶ Microwave Oven

▶ System LSI ▶ Network ▶ PC / PC Peripherals ▶ Refrigerator
▶ TFT LCD ▶ Fiber Optics ▶ DTV / DVDP ▶ Air Conditioner
Leading Products (’00)

Global Market Share

Semiconductor • DRAM 21 % No. 1

• SRAM 23 % No. 1
• TFT - LCD 21 % No. 1
Telecommunication • CDMA Handsets 26 % No. 1

• Color Monitor 19 % No. 1

Digital Media
• ODD 15 % No. 2
• DVDP 14 % No. 3
Home Appliances • Microwave Oven 23 % No. 1
Q2 2001 Results
Revenue and Earnings

Sales by Quarter Operating Incomes by Quarter

8.8 9.1 8.6 2.2

8.0
10 6% 2.5
7% 9% 2%
17% 1.5 1.6
8 2.0 8%
31%
Trillion Won

Trillion Won
35% 34% 8%
6 27% 1.5
14% 14%
19% 0.6
23% 14%
4 22% 1.0 89%
29% 9%
88%
2 43% 36% 0.5 64%
35% 50%
27%
43%
0 0.0
Q3 '00 Q4 '00 Q1 '01 Q2 '01 Q3 '00 Q4 '00 Q1 '01 Q2 '01

Telecommunication Digital Media

Semiconductor Home Appliances
Revenue and Earnings
Sales by Quarter Operating Incomes by Quarter

10 2.5

8 2.0
Trillion Won

Trillion Won
6 1.5

4 1.0

2 0.5

0 0.0
Q3 '00 Q4 '00 Q1 '01 Q2 '01 Q3 '00 Q4 '00 Q1 '01 Q2 '01

Our Well-Balanced Business Portfolio is Paying-off

Financial Analysis

1H ’01 2000 1999

Net Debt / Equity 10% 9% 32%

Debt / Capitalization 16% 20% 30%
Coverage Ratio* 94x 56x 14x

ROE** 24% 41% 31%

Profitability (Net Income / Sales) 0.13 0.18 0.12
Asset Turnover (Sales / Asset) 1.23 1.33 1.15
Leverage (Asset / Equity) 1.56 1.75 2.24

* Coverage Ratio = EBITDA / Net Interest Expense. ** Annualized for 1H

’01
Cash Flow of 1H 2001
(Unit: Trillion, KRW)

Source of Fund Use of Fund

Net Income 2.1 Capex 3.0
Depreciation 1.5 Increase in W/C 0.7
Sale of Marketable Securities 0.5 Debt Redemption 0.4
Others 0.7 Dividend 0.4
Others 0.7
Total 4.8 Total 5.2

Cash Balance
Beginning : 1.9 Net decrease : 0.4 End : 1.5

※ Cash Balance = Cash&Cash Equivalent + Short-term Financial Instrument

Revised CAPEX for 2001

(Unit : Trillion, KRW)

8 7.3

7 6.1

6 5.1
5
Semiconductor
4 Telecommunication
Others
3

0
Original 1st Revision 2nd Revision
CAPEX Plan - EBITDA vs. CAPEX

(Unit : Trillion, KRW)

12
10.1

10
7.2
8
5.2
6 4.3 4.3 EBITDA
3.4 CAPEX
4 2.5
1.6
2

0
1997 1998 1999 2000
EBITDA has been always larger than CAPEX
Divisional Highlights

- Semiconductor Division
DRAM Demand and Supply
• Balance is delayed by one quarter : Q3 ’01 → Q4 ’01

• Expected demand drivers

-XP, Brookdale, New applications (S-T Box, 3G Handsets, Game machines)

Original Forecast
1700 8%
( Unit : Million )
1600 6%
1500
4%
1400
2% Demand
1300
1200 0% Supply
1100
-2% Sufficiency
1000 rate
900 -4%

800 -6%
Q1 '01 Q2 '01 Q3 '01 Q4 '01 Q1 '02 ( Source : Company Data )
DRAM Demand and Supply
• Balance is delayed by one quarter : Q3 ’01 → Q4 ’01

• Expected demand drivers

-XP, Brookdale, New applications (S-T Box, 3G Handsets, Game machines)

Revised Forecast
1600 8%
( Unit : Million )
1500 6%
1400
4%
1300
2% Demand
1200
0% Supply
1100
-2% Sufficiency
1000 rate
900 -4%

800 -6%
Q1 '01 Q2 '01 Q3 '01 Q4 '01 Q1 '02 ( Source : Company Data )
Outlook for TFT-LCD Market
• Demand and Supply
- Oversupply of 10% for ’01 but expects shortage from Q3 ’02

25 15%
( Source : Company Data )

10%
20
(Unit : Brillion, Units)

5%
15
0%
10
-5%

5 -10%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q1 Q2 Q3 Q4
’01 ’01 ’01 ’01 ’02 ’02 ’02 ’02 ’03 ’03 ’03 ’03
Competitiveness
• Flexible product mix
- Monitor portion ↑ : 17% in 2000 → 37% in 2001
- Niche market (Small size LTPS for HHP, PDA) : 1M in 2001

• Continual cost reduction

- Number of components : 120 ~ 150 vs. SEC under 100
- Mask steps : 5 ~ 6 vs. SEC 4 ~ 5
- Mother glass size : 680 x 880 vs. SEC 730 x 920
Mother Glass 730x920 680x880
Panel (Samsung) (Others)

14” 9 panels 6 panels

15” 6 panels 6 panels
17” 6 panels 4 panels
Divisional Highlights

- Telecommunication Division
Global Handset Market
• Revised global handset shipment in 2001

- Global economy slowdown, Lack of new applications and contents,

Reduction of handset subsidies

Previous Forecast Revised Forecast

(March ’01) (July ’01)

China China
14% Asia Asia
16%
23% 25%

Europe Europe
Americas 36% Americas
38% 25% 24%

480 M units 410 M units

Achievements in 1H

• Outstanding sales in the midst of deteriorating market

- Sustain ASP by targeting mid to high-end segment

1H 2001
- Timely introduction of new models

GSM CDMA
- Domestic sales growth of cdma2000 1x handset 47% 53%

12.5million units
Business Outlook

• Expect continuous growth in 2H ’01

- Increasing adoption rate of 1x handset in domestic market

- Explore new business opportunities with 2001(F)

new service providers
TDMA
2%
GSM
CDMA
43%
“Maintain original target sales of 28M units” 55%

28million units
Wireless systems
• Recent achievements in 1H ’01
- Strong presence in 1x system market
- CDMA contracts in China and Puerto Rico

• 2H ’01 Outlook
- Domestic: 2.5G System expansion and upgrade to 1x EV-DO
- Overseas: Increasing adoption of CDMA technology
* China, Japan, Brazil, India, Israel, etc.

“Current macro environment remains challenging”

Divisional Highlights

- Digital Media Division

Digital Media
Global Market Share Trends

Product 1999 2000 2001 (F)

Rank M/S Rank M/S Rank M/S

Monitors 1 15% 1 19% 1 19%
ODD 2 12% 2 15% 2 14%
DVD Players 6 13% 3 16% 2 15%
Color TVs 5 8% 4 9% 3 9%
VCRs 3 12% 2 15% 1 16%
Convergence Vision

Home solution Establishing global competition

based on DTV  Extend P2P connectivity

• DTV
• DVDP A/V • PC
• CDP Consumer Computing • Server
• Printer
• VCR
• Monitor
• DVC
• MP3 Network • ODD

Convergence

New
Business
• Broadcasting STB • PDA
• Home Gateway • Web PAD

Networking Solutions
THANK YOU