The combined operating profit of South Korea’s top 50 companies fell 61 percent in 2019 from the previous year, due mainly to the weak performance of tech giants, latest data showed Thursday.
Local research firm Sustainable Growth Institute surveyed earnings data of the nation’s 50 largest companies by sales between 2018 and 2019. The survey found the combined operating profit of the top 50 companies in 2018 was 87.7 trillion won ($71.1 billion), but their operating profit shrank 61.7 percent to 33.6 trillion won the following year. This means 55 trillion won in profit has disappeared in a year.
The decline was greatly affected by the nation’s two tech behemoths, Samsung Electronics and SK hynix. Their combined operating profit in 2018 alone came to 64 trillion won. In the following year, the profit plunged 75 percent to 16 trillion won.
Of the top 50 companies, 28 firms, including the two tech firms, saw their operating profit decline or suffer losses.
The sales growth of the top 50 Korean companies has reached its limit, the research firm said.
The combined sales volume of the 50 companies reached 801.2 trillion won in 2011, reaching the 800 trillion won mark for the first time. However, it has not surpassed the 900 trillion won mark since then.
Sales in 2017 and 2018 grew, reaching 835.9 trillion won and 892.9 trillion won, respectively, but failed to break the 900 trillion won barrier. Sales rather fell to 830.9 trillion won last year, down 34.5 trillion won from the previous year.
By Shin Ji-hye (email@example.com