I wish you and your family happy and prosperous 2014, the year of Horse.
Throughout 2013, our business environment experienced challenges led by continued uncertainty of global fiscal policies coupled with delayed recovery in Europe, and currency volatility and weak consumer sentiment in Korea and other emerging markets.
Despite challenges, thanks to sacrifice and dedication from our employees to enhance our competitiveness, the company achieved record revenues and profits and maintained the global IT leadership position.
I want to thank you, our shareholders, for your continued trust and support in making this possible, and would like to elaborate on key achievements during the past year.
In 2013, we delivered record sales of KRW 229 trillion, up 14% from the previous year, and both operating profit and net profit increased by 27% and 28%, respectively, over the year to KRW 37 trillion and KRW 30 trillion.
In the mobile business, both revenue and profits significantly increased from the prior year driven by strong smartphone sales momentum outperforming the market growth and more than double tablet sales in 2013.
In the TV business, despite slowing demand amid global economic downturn, we delivered the industry best profitability and reinforced our market leadership by maintaining our global No. 1 position for eight consecutive years since 2006.
Our Memory business earnings improved significantly, amid stable supply and demand, driven by effective cost savings through advanced process technology migration and increased shipments of differentiated and high value added products such as SSD. For System LSI, we sharpened the future technology leadership such as advanced process technology competitiveness and developed next-gen products initiatives.
Our OLED business posted solid earnings growth led by competitive advantages based on product differentiation. We achieved commercialization of the world's first curved display while focusing on technology and product competitiveness for future growth.
Amid revolutionary changes recently seen in the IT industry, we have put efforts to enhance our R&D capabilities by increasing R&D personnel and revamping our organization structure. We expanded partnership with external research institutions by establishing an open innovation system, newly built internal research centers including SofTech and Big Data Center to strengthen our software capabilities, and also plan to open a material and future technology R&D center going forward.
To expand the base for future growth engines, we are focusing our resources and competencies onto not only existing medical devices, LED, and B2B businesses, but also on Smart Home, mobile health, and other life-care areas, which could improve quality of life. In particular, our efforts are concentrated on education, medical institutions, public sector, and retail for the B2B business. For instance, we are running a pilot program of Smart School Solution in UAE, and Turkey while introducing our new mobile security solution KNOX, which gained positive response from the market. In addition, we released new Smart Home connected with smartphones at CES and it was well received by the media and audience.
With such efforts, we registered 4,676 patents in the US, won nine IDEA awards and 24 CES Innovation Awards, and ranked second in the innovative corporation list made by BCG. As seen in these achievements, our products are widely acknowledged for the best design and innovative corporate image in the world. According to the Interbrand survey, our brand value recorded USD 39.6 billion - a 20% increase compared to the previous year and ranked eighth in the list.
As part of our efforts to share the 2013 earnings results with shareholders, we declared the total dividend of KRW 14,300 per common share and KRW 14,350 per preferred share, which is approximately 80% increase from the last year. We believe such significant over the year increase in dividends demonstrates the management's firm commitment of putting shareholders at the heart of the management.
Despite facing challenges in the global business environment, we held the Samsung Analyst Day to enhance our corporate value and improve communication with investors. Our CEO, CFO, and heads from all businesses gave a presentation in person to around 400 global investors from across the world, and proposed mid-to-longer term vision and business strategies to clearly show our commitment to the sustainable growth for the future. Thanks to the support from participating investors, the investor event concluded successfully.
While U.S. and Europe are expected to lead the global economic recovery in 2014, some macro uncertainties, such as increased emerging market currency volatility are expected to continue. Meanwhile, we anticipate that competitions will intensify further in the IT industry given the trend of value chain extension, emergence of Chinese players in the global market, and weak Yen. However, we will rather turn these challenges into opportunities. We will do our best to improve our business results, thereby increasing shareholder value.
In our core businesses - handset, TV, memory and other semiconductor products, and OLED - we will solidify our number 1 position through premium product development and technological differentiation.
In the mobile business, we will expand new product line ups beyond flagship smartphones and lead the LTE market. For tablets, we will create a new large screen product category while reinforcing strategic model line ups.
For TV business, we will strive to increase sales of premium products with high value including UHD, Curved, and over 60" large-size TVs amid UHD TV market expansion. Especially for Set products, we will improve retail efficiency and synergy through innovative retail system including Experience Shop.
In the memory business, we will expand cutting-edge process migration, and increase the mix of high performance high value added products and solutions. Meanwhile, we will also solidify our technological leadership based on mass production of vertical NAND.
For OLED panels, we will expand its application beyond smartphones and achieve mass production of upgraded flexible panels to create a strong foundation for future growth.
In our growth businesses - home appliances, network equipment, system LSI, etc. - we will develop key technologies and expand the customer base for future growth.
We will focus on enhancing global operation capability and reinforcing premium product strategies for home appliances, maximize sales opportunities in the LTE equipment market for network equipment, and enhance product competitiveness and prepare for migration towards next gen 14nm class for system LSI.
In addition, we will improve efficiency of the company-wide resource management including investment and continue efforts to enhance our global SCM capability.
For a company to continue its growth momentum in the mid to longer term, the key is to have an ability to make prompt response to uncertainties and risks in the business environment. We will take preventive measures and thoroughly manage all the risks related to possible compliance issues. In addition, we will make social contribution to local communities, as well as enhance communication with various stakeholders.
We will establish a differentiated ecosystem to maximize competitive advantages in our extended value chain such as components, set products, services, and solutions. We will also continue to pursue technological innovation to strengthen our leadership.
For set business, we will continue to innovate and develop new product categories, such as the future mobile communication, UHD, 3D, Real Sound, and Energy Efficiency technologies. Meanwhile, for components, we will focus on future technologies such as the cutting-edge process, packaging, multi-processing, solutions, and flexible OLED.
At the same time, we will continue our efforts to develop and secure advanced electronic materials that will be the main source of our competitiveness to obtain meaningful results from our future growth engine such as B2B business.
We are committed to the principle that the Company's strong business performance will ultimately enhance shareholder value. For this year, we will continuously strive to deliver outstanding business performance led by our commitment. Additionally, we will better communicate with our shareholders and other members of the investor community to share our sustainable growth vision through proactive IR activities.
For the last 20 years, Samsung has always been committed to the Company's motto of "New Management" to take on challenges resulted from the rapid pace of globalization. As a result, we were able to become a leading company of the global IT industry today.
We will continue to face a number of challenges this year. However, we are determined to renew the commitment that we desperately made 20 years ago to make Samsung Electronics the world's best company.
Again, I wish you and your family the best in 2014.
Vice Chairman & CEO
Samsung Electronics Co., Ltd