Korean mid-size companies’ capex up 1.1% in H1

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South Korea’s top 500 mid-size companies expanded capital expenditures by 1.1 percent in the first half of this year from a year ago despite a 19.6 percent decline in operating profit.

According to corporate data tracker CEO Score on Wednesday, a survey of 490 out of the country’s top 500 mid-size companies with comparable data from 2021 showed that their combined capex in the January-June period came to 6.83 trillion won ($5.1 billion), up 1.1 percent from the first half of last year at 6.75 trillion won.

The combined operating income of the companies fell 19.6 percent to 5.87 trillion won during the same period.

“Despite the decline in operating profit, the companies bolstered investments for the future,” CEO Score said.

Among the surveyed companies, Chunbo Co. carried out an investment of 205.3 billion won in the first half, up 212.3 percent from the same period a year ago.

Chunbo built a factory dedicated to secondary battery materials inside the SaeManGeum National Industrial Complex.

KSS Line Ltd. also registered an investment of 145.7 billion won up 256.2 percent from last year. The company incorporated gas carriers into its operations.

JAHWA Electronics invested 120 billion won, up 239 percent, to establish a manufacturing facility in Gumi, North Gyeongsang Province, for the production of components for Apple Inc.

Creas Co., on the other hand, slashed its capital expenditure in the first half of this year by 95.3 percent to 6.9 billion won. Nepes also cut investment by 74.6 percent, Ananti Inc. 49.9 percent, and Solus Advanced Materials 35.2 percent.

By industry, the petrochemical sector, which includes secondary batteries, registered the most substantial surge in capital expenditures. Investment totaled 1.08 trillion won, up 47 percent during the cited period.

The automotive and auto parts industry’s capital expenditures amounted to 728.4 billion won, up 45.6 percent, and the transport sector 298.2 billion won, up 50.1 percent.

The IT and electronics industry, on the other hand, saw capital expenditures decline by 14.4 percent to 1.7 trillion won. Other industries such as pharmaceutical, commodities, services, food and beverage, and distribution also reduced capital expenditures.