EM ASIA CREDIT: Samsung (SAMSNG, Aa2/AA-/AA-) to boost employee wages

Samsung (SAMSNG, Aa2/AA-/AA-)

"*SAMSUNG, UNION TENTATIVELY AGREE TO 5.1% WAGE INCREASE: YONHAP" - BBG

• Samsung is reported to have agreed with unions to increase the wages of its Korean workforce by 5.1%. Small negative for spreads.
• In context, wages & salaries accounted for around 11% of group revenues in 2024. The Korean workforce represents around half of the global workforce.
• As a guide, if we bump half the labour costs up by 5.1% the 2024 operating margin would shrink from 10.9% to 10.6%.

• We would need to know the mix better to calculate a definitive impact on margins, but overall feels like a manageable change for credit.