April 24, 2024

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[THE INVESTOR] Samsung BioLogics' third-quarter earnings were in line with market expectations, said Korea Investment and Securities on Oct. 24 maintaining a “buy” recommendation and 610,000 won (US$538.11) target price.

Although its operating profit in the period plunged 49 percent on-year to 10.5 billion won the figures satisfied market consensus. This was due to the temporary decline in operation ratio of its first factory and personnel cost rise from third. In the fourth quarter a total of 175.5 billion won cash inflow is expected. This includes 757.3 billion won from carrying out a call option and 175.5 billion won from sales of biosimilars, which will turn around the company’s annual profit to 354.2 billion won. Its cash reserves will also surpass 1 trillion won, said analyst Jin Hong-guk.

What is more important than its earnings though is the probe results of accounting violation allegations. As the timeline of second round of talks between Financial Supervisory Service and the firm are brought forward, uncertainties over the issue will be cleared by the end of this month, forecast the analyst. 

By Hwang You-mee (glamazon@heraldcorp.com)