Listed firms’ earnings plunge in H1

Screens in Hana Bank's trading room in central Seoul show the Kospi standing at 2519.82 points during trading hours Thursday. The Korean won against the US dollar closed at 1,342 won, up 5.1 won from Wednesday. (Yonhap)

In the first six months of 2023, the added operating profit of Kopsi-listed firms fell by more than half, as the economy struggles to deal with the impact of global geopolitical tensions and high interest rates, the Korea Exchange said Thursday.

According to data provided by the Korea Exchange, the operating profit of 615 firms listed on Kospi stood at 53.1 trillion won ($39.6 billion) from January to June, 52.45 percent less than that of the same period from a year before. Data was not included for 74 firms for various reasons, such as changed status due to mergers and acquisitions.

The firms’ net profit was 37.68 trillion won, down 57.94 percent on-year.

The drop in profit was the largest seen since the KRX began compiling the data in 2005.

But the firms' total sales rose 2.28 percent on-year to a record 1,390 trillion won. Tech giant Samsung Electronics accounted for 8.9 percent of the total sales.

Yet the average operating profit margin was just 3.82 percent, showing a 4.4 percentage-point drop from that of last year. This means firms earn an average 38.2 won for every 1,000 won of sales.

Of the 615 firms, 469 posted net profit while 146 posted a net loss.

Firms listed on the country’s tech-laden secondary bourse, the Kosdaq, also saw their profitability drop.

Among the 1,230 firms listed on the market as of December, 1,112 firms saw their sales increase by 5.2 percent to 136.11 trillion won. However, their operating profit dropped by 36.1 percent to 5.58 trillion won, while the net profit dipped by 41.4 percent to 4.13 trillion won.

The average operating profit margin for Kosdaq-listed firms decreased to 4.1 percent, the lowest since 2012.

“The total sales amount of listed firms did not see much change, but their profit experienced a steep decrease due to issues in production costs and expenses,” the Korea Exchange assessed. “The supply network shock from the (Russia-Ukraine) war, an increase in costs due to higher interest rates are the reasons.”

By Im Eun-byel(silverstar@heraldcorp.com)