SEOUL, Nov. 30 (Yonhap) — Consolidated earnings for South Korean listed companies fell nearly 40 percent on-year in the third quarter of the year amid unstable economic conditions and slowing exports, a report showed Wednesday.
The combined net profit of 147 big firms with assets over 2 trillion won (US$1.8 billion), such as Samsung Electronics Co. and Hyundai Motor Co., totaled 14.2 trillion won in the July-September period, compared with 22.6 trillion won a year earlier, according to the report by the Korea Exchange and the Korea Listed Companies Association.
In the first nine months of this year, their total net profit stood at 55.6 trillion won, down 17.4 percent from 67.3 trillion won in the previous year.
A company with more than 2 trillion won in assets is required to file a consolidated financial statement that brings together all assets, liabilities and operating accounts of a parent company and its subsidiaries. A total of 23 companies whose earnings were incomparable, including financial groups, were excluded from the tally.
The report showed the firms’ combined revenue climbed 13.7 percent to 359.2 trillion won over the cited period, while their operating income slipped 8.3 percent to 25.1 trillion won.
The report said the weaker bottom line came as companies’ profitability slipped amid global uncertainties stemming from the eurozone debt crisis and a slowing U.S. economic growth. Declining demand for South Korean information technology (IT) products as well as a rise in commodity and oil prices also ate into their earnings, it added.
“The factors led to lower profitability for companies doing business in the tech, auto and shipbuilding industries. The construction sector also remained sluggish,” it said.
Tech heavyweight Samsung Electronics topped the list of profitable firms, followed by industry leaders SK Innovation Co., Hyundai Motor, LG Chem Co. and Hyundai Heavy Industries Co.
Four of the companies, excluding SK Innovation, saw their earnings slump from the previous year, while the leading oil refiner’s net income surged more than seven-fold.
Meanwhile, of the 612 companies listed on the main bourse with comparable data, 65.7 percent turned profits in the third quarter, while the remainder posted deficits.
The average debt ratio of the tallied big firms came to 133.84 percent as of end-September, growing from 131.48 percent from the end of last year, according to the report.