KOSPI Companies' First Half Report Card 'Frowning'... Operating Profit Down 24%

Consolidated Net Profit Also Decreased by 34% Compared to the Same Period Last Year
Financial Sector Sees Operating Profit and Net Income Increase in Insurance

Photo by Korea Exchange Provided

[Asia Economy Reporter Kum Boryeong] The sales, operating profit, and net profit of companies listed on the KOSPI market in the first half of the year all decreased compared to the previous year. This is due to the impact of the novel coronavirus infection (COVID-19). However, the second quarter showed a recovery compared to the first quarter.

According to the Korea Exchange on the 19th, the consolidated sales of companies listed on the KOSPI market in the first half amounted to 943 trillion won, and operating profit was 42.7 trillion won, down 5.78% and 24.18% respectively compared to the same period last year. Net profit was 25.5 trillion won, a decrease of 34.1%. The analysis covered 592 listed companies with December fiscal year-end.

Excluding Samsung Electronics, the situation is worse. Sales excluding Samsung Electronics were 835 trillion won, operating profit 28 trillion won, and net profit 15 trillion won, down 6.46%, 35.38%, and 47.08% respectively compared to the same period last year.

By industry, sales increased in four sectors including pharmaceuticals (15.97%) and food and beverages (7.12%) in the first half. On the other hand, sales decreased in 13 sectors including transportation and warehousing (-15.47%) and chemicals (-13.12%). In terms of net profit, food and beverages (173.82%), pharmaceuticals (122.09%), and paper and wood (57.86%) saw an increase in profit margins, while chemicals (-97.03%), textiles and apparel (-88.86%), and transportation equipment (-70.98%) experienced a decrease.

Among the analyzed companies, 421 companies (71.11%) recorded net profit, while 171 companies (28.89%) posted losses. The debt ratio at the end of June was 115.96%, up 3.17 percentage points from 112.79% at the end of last year.

Even within the first half, the second quarter performance was better than the first quarter. Although second quarter sales were 450 trillion won, down 8.94% from the first quarter, operating profit was 23.2 trillion won and net profit was 14.2 trillion won, increasing by 19.17% and 25.22% respectively. The operating profit margin and net profit margin based on sales were 5.16% and 3.16%, up 1.22 percentage points and 0.86 percentage points from the first quarter.

In the second quarter, sales increased compared to the first quarter in medical precision instruments (44.74%), construction (7.63%), non-metallic minerals (6.52%), and pharmaceuticals (5.89%). Conversely, sales decreased in electricity and gas (-29.03%), chemicals (-19.53%), transportation and warehousing (-18.52%), and transportation equipment (-13.8%).

The performance of 41 financial companies in the first half was mixed by sector. The total operating profit and net profit of the financial sector in the first half were 16.5 trillion won and 12.3 trillion won, down 4.58% and 7.14% respectively from the previous year. Among these, operating profit and net profit of banks and securities decreased, while insurance operating profit and net profit increased.

This content was produced with the assistance of AI translation services.