Korean firms feared to fare worse in 1st quarter: report

Korea's major listed firms are expected to struggle in the first quarter of the year largely due to the global economic slowdown and weak domestic demand, data showed Thursday.

The combined operating profit of 98 listed companies is forecast to be 23.89 trillion won ($21.29 billion) for the January-March period, smaller than the 27.26 trillion won projected six months earlier, according to the data by local financial information provider FnGuide.

The first-quarter estimate is also down 2.27 percent from a year earlier, the data showed.

According to FnGuide, energy and airline businesses are likely to have bad performances during the current quarter, buffeted by high-flying international crude oil prices. Most business segments are also expected to face rough business conditions in the current quarter, it said.

FnGuide attributed the worse business performance in the first quarter to the global economic downturn and increased costs of raw materials.

The market information provider also said fourth-quarter operating profits of listed firms are estimated to have dropped 6.58 percent from the previous quarter.

"Local companies' profits have been on the decline after reaching a peak in the first quarter of last year," said Lee Jong-woo, an analyst at Solomon Investment & Securities. "Corporate earnings are hurt by the economic slowdown."

The estimated combined operating income at the 98 listed firms for the second quarter is 25.93 trillion won, FnGuide said.(Yonhap)