South Korea's Samsung Electronics, the world's biggest maker of memory chips and TVs, cut its target for 2008 sales and issued a modest forecast for earnings growth in what it called a difficult global environment.
"We are aiming to post a sales increase of more than 10 percent than in 2007," Samsung Electronics CEO Yun Jong-yong said at the company's annual shareholder meeting. The new target is lower than a January company forecast for 15 percent growth.
"We will focus on high value businesses and aim to post a net profit higher than 2007's," Yun also said, adding that the 2008 targets have not been finalized.
Samsung in 2007 posted net profit of 7.43 trillion won ($7.53 billion) on sales of 63.18 trillion on a parent basis. Sales grew 7 percent in 2007.
"Global economic growth is expected to slow this year," Yun said, citing high oil and raw materials prices and global financial markets rendered unstable by the dollar's weakness. "We aim to continue posting high profits from our four strategic businesses -- memory chips, LCD, mobile phones and TVs -- by being the first ones to enter next-generation markets and
differentiating our products."
Samsung's memory chip business, once a cash cow, is grappling with extremely difficult market conditions because of oversupply and collapsing prices in dynamic random access memory.
The sector's profitability has been compounded by steep price falls in NAND flash chips, used in portable electronics.
But its liquid crystal display (LCD) business is set to enjoy a strong year with solid demand and tight supplies.
Samsung Electronics, the flagship company of the country's biggest conglomerate, Samsung Group, has said key executive decisions regarding the company had been delayed pending an investigation into alleged slush funds.
South Korea in January launched a special probe after a former legal executive said Samsung kept a slush fund worth over $200 million in accounts set up in its executives' names to pay off officials and squash probes into its management practices.
Samsung has denied any wrongdoing and called the accusations groundless.