Summary: The electronics giant wants to invest more of its huge war chest in new technology and marketing, and is looking to reward investors more by at least doubling its dividend yield.
Samsung Electronics wants to invest more money for new growth technologies, and part of that will come from being more aggressive in mergers and acquisitions as well as R&D.
M&A will aim to reinforce current businesses, secure talent and find new opportunities, said Lee Sang-hoon, president and CFO of Samsung Electronics. The company has already spent about US$1 billion investing in 14 companies since 2010, which has been "somewhat conservative".
Lee was kicking off Samsung's first Analyst Day since 2005 in Seoul which was streamed live. The event is seen as a platform for the company to better communicate with investors and analysts, amid sagging share prices and returns.
Samsung currently has a cash pile of around US$50 billion, which is about 20 percent of its market capitalization and has attracted complaints from investors of being at a level too high at their expense. According to Lee, the war chest will now being prepared for "significant investment" in strategic technologies, mergers or acquisitions.
"We plan to allocate a significant portion of our annual cash flow into capex and R&D to secure future growth and shareholder return," Lee said.
Samsung has been shifting its focus away from building capacity and capturing market share, to developing new technologies and creating new markets. (source: Samsung)
Balancing growth vs dividends
Despite a more aggressive stance to invest more for growth, Samsung also announced a more generous dividend policy to distribute its free cash.
Samsung will double its dividend yield to around 1 percent of its share price, compared with 0.5 percent last year. This ratio would be reviewed every three years to reflect changes in business conditions, added the CFO.
The new approach is an interesting balance as many high growth mode companies, particularly in technology such as Google, typically shy away from offering dividends in favor of investing their spare cash.
Spending more on R&D
Samsung will invest US$14 billion on research and development by the end of 2013, compared with US$8 billion in 2010, said the CFO. A key area of focus will be beefing up its competencies in software to match its strengths in hardware.
Lee noted the company has been gradually shifting its focus of investment from making gains in existing markets to "new market creation," and will "continue this strategy in the near future". This was highlighted in an example later brought up by JK Shin, president and CEO of IT and mobile communications, who pointed out Samsung created the "fonblet" market, also known as phablets.
In the mobile space, Samsung expects the rollout of LTE-Advanced (LTE-A) networks across the developed world to drive handset sales in markets that already have a high level of smartphone penetration.
Patent protection planning
In 2010, the company set up an intellectual property center to centralize its patent capability efforts, along with country-level IP centers worldwide. The CFO added Samsung now also ropes in its in-house team of patent experts, which number about 600, into the new product development cycle "at the planning stage."Samsung has also been investing big on the patent front, said Lee. "As products become more complex, the number of patent disputes is on the rise, leading to greater exposure to patent risk."
Just last month, Samsung was among the Android handset makers along with Google who were sued by Rockstar patent consortium--owned by Microsoft, Apple, BlackBerry, Ericcson and Sony. This came just weeks after Samsung said it would no longer bring rivals to court over certain patent infringement cases for the next five years.
Two vulnerabilities discovered and patched over the summer expose Jenkins servers to mass exploitation. Thousands, if not more, Jenkins servers are vulnerable to data theft, takeover, and cryptocurrency mining attacks. This is because hackers can exploit two vulnerabilities to gain admin rights or log in using invalid credentials on these servers. Both vulnerabilities were discovered by security researchers from CyberArk , were privately reported to the Jenkins team, and received fixes over the summer. But despite patches for both issues, there are still thousands of Jenkins servers available online Jenkins is a web application for continuous integration built in Java that allows development teams to run automated tests and commands on code repositories based on test results, and even automate the process of deploying new code to production servers. Jenkins is a popular component in many companies' IT infrastructure and these servers are very popular with both f...
Summary: The secretive system uses data and other techniques to ferret out cops and root out anyone who may do the service harm. An internal program used by Uber for years to dance around the police in areas where the ride-hailing service was frowned upon has been exposed. In cities such as Boston, Las Vegas, and Paris, alongside countries including China and South Korea, Greyball is used as part of the violation of terms of service (VTOS) program which Uber created in 2014 to ferret out and black-mark anyone that may be a threat to the firm.Dubbed Greyball, Uber's program uses data analytics and a myriad of other tactics to avoid the authorities in places where the service is resisted by law enforcement or banned outright, according to the New York Times . Predominantly used in the US, Greyball first came to light in the same year when investigators began to hail rides using the Uber app to build a case against the company. One such investigator, Erich England from ...
The bank has launched a pilot trialing voice verification for money transfers greater than AU$1,000. Australia and New Zealand Banking Group (ANZ) has announced it will be introducing voice biometrics to its mobile banking in a bid to improve security on high value transactions. From mid-2017, customers transferring more than AU$1,000 through ANZ's mobile apps will be able to use their voice to automatically authorise high value payments, and bypass usual security measures such as visiting a branch in person. ANZ will kick off the new technology with a pilot running with ANZ staff and select customers in May using the Grow by ANZ mobile app. The service will then be rolled out to ANZ goMoney and other digital services progressively, the bank said. According to Peter Dalton, ANZ managing director customer experience and digital channels, voice biometrics is the next step in making banking more convenient for customers while also strengthening security. "One of the...
Comments
Post a Comment