Kumho, GS Suffer Earnings Shocks
By Lee Hyo-sik
Staff Reporter
Despite the worldwide economic slump, Korea's corporate sector has been posting a strong performance this year, turning Asia's fourth largest economy into one of the fastest recovering economies in the world.
But not all major business groups here have performed well, with domestic market-oriented companies sustaining disappointing results amid prolonged sluggish local demand. But export-oriented businesses are enjoying record-high sales abroad, capturing greater market shares.
Among the nation's top 10 conglomerates, logistics-based Kumho Asiana Group ,GS, Lotte and Hanjin Group suffered losses in the third quarter, down from a year earlier, while Samsung, Hyundai and LG reported strong earnings, the Korea Exchange (KRX) said Wednesday.
Korea's ninth largest conglomerate Kumho Asiana sustained a 415.6 billion won net loss during the July to September period from the same period last year.
Hanjin Group, the country's 10th largest conglomerate, suffered 129.4 billion won net loss in the third quarter from a year earlier. Hanjin has been also grappling with a cash shortage in the aftermath of the global credit crunch. Net profits for GS and Lotte also fell 15.32 and 20.36 percent, respectively.
The nation's largest steel product maker POSCO also saw its net profit decline 3.5 percent to 1.15 trillion won in the third quarter from the previous year, with its revenues and operating profits dropping 22.1 and 50 percent, respectively.
On the other hand, Samsung, Hyundai and LG, which have been outrivaling their foreign competitors at home and abroad, posted better-than-expected results.
Samsung Group saw its net profit surge 153 percent to 4.49 trillion won during the July to September period compared to a year earlier, with its revenues and operating profits soaring 20.8 percent and 122 percent, respectively.
Hyundai Automotive Group also posted strong results, realizing a 320 percent jump in net profit to 2.1 trillion won from 492 billion won last year, while that of SK Group rose 11.7 percent to 970 billion won.
KRX said the combined revenues of Korea's 10 largest business groups increased 2.5 percent to 126.6 trillion won in the third quarter, with total net profits surging 120 percent to 12.4 trillion won.