Samsung Electronics plans record W110tr shareholder return

Samsung Electronics has announced plans to return up to 110 trillion won, approximately $65.2 billion, to its shareholders in 2024, setting a new record for the largest shareholder return by any Korean company. The decision was made following approval by the company's board of directors on Friday. This amount exceeds the previous record of 20.3 trillion won set in 2020 by more than five times. A Samsung Electronics representative stated that the initiative aims to distribute the benefits of the company's growth among shareholders in a meaningful manner while maintaining a positive feedback loop between corporate expansion and increased shareholder value. The proposed shareholder return is part of Samsung's ongoing three-year strategy, spanning from 2024 to 2026, which mandates that half of the company's free cash flow be distributed back to shareholders. In both 2024 and 2025, Samsung issued regular dividends totaling 9.8 trillion won annually, accumulating to 19.6 trillion won over the two years. Additionally, the company distributed 1.3 trillion won in special dividends last year and repurchased and canceled 8.4 trillion won worth of its own shares. With the inclusion of this year's anticipated returns, Samsung expects to distribute between 120 trillion won and 140 trillion won to shareholders throughout the three-year period. For 2024 alone, the company intends to allocate approximately 30 trillion won in cash dividends, encompassing its regular third-quarter dividend. The specific figures and composition of these dividends will be decided during a board meeting scheduled for late October. The remaining portion of the shareholder return for 2024 will be determined at another board meeting in January, once the company has completed its annual financial reporting. Samsung is contemplating a mix of further cash dividends and share buybacks followed by cancellations to fulfill the rest of the return commitment. In addition to the shareholder return plan, the board also authorized the acquisition of around 15 trillion won worth of treasury shares intended to finance employee compensation. Although this program operates independently of the shareholder return initiative, the company indicated that these stock purchases could also play a role in bolstering shareholder value. Samsung's decision to significantly increase its shareholder returns reflects broader trends within the global technology sector, where companies often seek to reward investors amid fluctuating market conditions and evolving business strategies. By committing such a substantial sum to shareholders, Samsung underscores its confidence in future profitability and its desire to maintain strong investor relations. The company's approach aligns with its long-term strategic goals, emphasizing sustainable growth and value creation for all stakeholders.