Samsung's rated "A+" by S&P

SEOUL, July 26 (Yonhap) -- Global rating agency Standard & Poor's Ratings Service (S&P) said Tuesday that its has decided to maintain its "A+" rating on Samsung Electronics Co., the world's largest smartphone maker, citing its stable market presence.

The rating agency also offered a "stable" rating outlook on Samsung.

"Although competition is heating up in the smartphone, display panel and home appliance sectors due to Chinese rivals' growth, Samsung's diversified business portfolio and the competitiveness of its premium products will offset cyclical changes and generate stable cash flows," S&P said in a statement.

S&P said Samsung's smartphone business is highly likely to suffer the ups and downs in its performance for the next two years, and the global memory chip market will also suffer a mild downward cycle.

Earlier, the country's top tech firm estimated that its second-quarter operating income increased more than 17 percent from a year earlier on the back of robust sales of its flagship smartphones, such as the Galaxy S7 series.

Operating profit is estimated at 8.1 trillion won (US$6.98 billion) in the April-June period, up 17.39 percent from the 6.9 trillion won posted a year earlier.

The estimate breaches the 8 trillion won mark more than two years after it posted an 8.5 trillion won profit in the first quarter of 2014 and is far above the previous market forecast.

Samsung said its second-quarter sales are also forecast to have reached 50 trillion won, also up 3 percent from 48 trillion won a year earlier.

Samsung Electronics is set to release its second-quarter earnings this week.

sam@yna.co.kr
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