More than one in five South Korean public firms was found to be unprofitable and highly indebted, data showed Friday, pointing to the need for reforms to save taxpayers' money.

Some 40 out of the country's 190 state-run companies and public institutions, or 21.1 percent, turned out to have failed to generate a large enough operating profit to pay taxes and interest payments as of the end of 2014, according to the data compiled by corporate tracker Chaebul.com.

The data was based upon the public firms' audit reports filed with the Financial Supervisory Service and the finance ministry.

Of the 70 state-own companies, 22 were found to be unprofitable due mainly to their bungled investments.

Korea Gas Corp., which has taken the initiative in developing natural resources overseas, made an operating profit of 938 billion won ($824.5 million) last year, but its interest costs reached 1.9 trillion won, according to the data.

The Korea Trade Insurance Corp. has also been in trouble after becoming the largest creditor of local shipbuilder ShinaSB in 2010.

After facing a debt ratio of 600 percent with 1.84 trillion won in debt, the shipyard was put under court receivership last year.

Among 82 semi-public entities, 15 turned out to be unable to pay taxes. They include the Korea Consumer Agency and the Korea Energy Agency.

Of the remaining 38 public institutions, three have been recording losses, according to the data.

In the wake of an increasing number of "zombie" companies from 2,698 in 2009 to 3,295 last year, the country's financial regulator vowed to complete restructuring by the end of this year. (Yonhap)