On Sunday, the market data showed that top business groups of South Korea saw a decline of 40 percent in their operating profits in the first half of this year as compared with the last’s profit of same period. The main reason behind this dip was the weak performances of the tech giants such as SK and Samsung.
According to the data gathered by CEO Score, the industry tracker, the merged operating profit of the top 55 firms out of the 100 listed companies which made an announcement about their operating profits of the initial half of 2019 came to be 42.8 trillion won which is equivalent to US$35.6bn, a sharp decline from last year’s 71.1 trillion won.
The sales increased 1.2 percent over the cited period to 592 trillion won, the data revealed.
The major reason behind the decrease was attributable to giant chipmakers. Samsung Electronics Co., saw a dip in its operating profit of 57.9 percent, whereas, the operating profits of the second leading chipmaker SK Hynix Co. sank 79.8 percent.
Steelmakers and chemical firms were also amongst the ones who suffered major losses, the industry tracker told.
The operating profit of LG Chem Ltd. Also dropped 59.9 percent in the initial half of this year as compared with that of profit of last year’s same period & that of top oil refiner SK Innovation Co. dropped 47 percent. In addition to this, the operating profit of the top steelmaker POSCO dropped 17.1 percent.
On the other hand, the car-manufacturers, who lost its leading position in sales last year because of economic retaliation by China against South Korea over Seoul’s deployment of a United States missile defense system, enjoyed greater profits.
CEO Score added that Hyundai Motor Co and its sister company Kia Motors Corp. had a surge in its operating profits 26.4% and 71.3% year-on-year, respectively, in the initial half of this year.