Hynix, Daewoo See Dwindling Cash Pile
By Kim Tae-gyu
Staff Reporter
Hynix Semiconductor, the world's No. 2 memory chipmaker, and S-Oil, Korea's third-largest oil refinery, were the biggest losers last year as they saw their cash pile dwindle by the two largest margins.
The Korea Exchange (KRX) announced Thursday that Hynix lost 1.3 trillion won in cash and its equivalents throughout 2008, followed by S-Oil with 1.27 trillion won.
Other flagship Korean entities Daewoo Shipbuilding & Marine Engineering and Samsung Electronics followed with losses of 1.26 trillion won and 1.22 trillion won, respectively.
The four combined to post losses of more than 5 trillion won in the KRX survey, which examined cash and other financial vehicles that can be easily converted into cash.
Experts point out the reduction of the short-term liquidity poses a threat in time with the financial crisis.
``In the era of the credit crunch, cash is king. If you have a high pile of cash, you are safe, and if not, you may face troubles,'' said Kim Seong-bong, an analyst at Samsung Securities.
``In particular, the freezing of the credit market peaked at the end of last year. At the time, cash losers might have felt jolted,'' he said.
Hynix saw its cash pile dwindle most because the Icheon, Gyeonggi Province-based company netted a huge loss amounting to 4.38 trillion won in 2008 due to plunging memory chip prices.
S-Oil blamed the rise of crude oil prices in early 2008 and the construction of new factories. It added the firm's cash reserves are big enough at 2.1 trillion won, the seventh largest among all listed companies.
Among the country's top 10 conglomerates, dubbed chaebol, Lotte lost the greatest portion of its cash reserves. As of the end of 2007, the group had 2 trillion won, but the figure dipped by 26.99 percent to 1.47 trillion won in 2008.
Hyundai Heavy Industries Group and Hanjin Group followed with drops of 24.15 percent and 11.88 percent, respectively. Samsung Group was also a loser at 0.55 percent.
By contrast, Kumho Asiana Group more than doubled its cash from 1.24 trillion won to 3.87 trillion won over the same period.
On average, the 10 conglomerates increased their cash pile by 16.88 percent.