Samsung SDI Swings to Profit in Q1 on Strong ESS, Cylinder Battery Sales

SEOUL, April 28 (Yonhap) -- Samsung SDI Co., a major South Korean battery manufacturer, said Tuesday it swung to a profit in the first quarter from a year earlier, driven by expanded energy storage system (ESS) sales. In the three months that ended in March, the company shifted to a net profit of 56.1 billion won (US$38.1 million) from a net loss of 216 billion won in the same period last year, it said in a regulatory filing. The company attributed the turnaround to increased U.S.-based production and sales of ESS batteries, along with stronger demand for high-margin cylindrical batteries. Lower corporate tax outlays also contributed to the improved results. Operating loss narrowed to 155.6 billion won from 434.1 billion won during the same period. Sales rose 12.6 percent to 3.57 trillion won from 3.17 trillion won. Samsung SDI expects its performance to recover gradually from the second quarter, supported by improving market demand. In the electric vehicle (EV) battery segment, demand is projected to strengthen on the back of expanded incentives in Europe and the rising total cost of ownership of internal combustion engine vehicles, the company said. For the ESS business, Samsung SDI plans to expand U.S. production and sales capacity to meet increasing demand from artificial intelligence (AI) data centers. "Despite ongoing uncertainties in the global business environment, we will continue to execute our strategies across all business areas and aim to return to quarterly profit in the second half," a company source said.