Gwangju and Jeonnam Companies See Growth and Stability Worsen, but Profitability Improves

Bank of Korea Gwangju-Jeonnam Branch 'Corporate Management Analysis Results'

Last year, for-profit corporations in the Gwangju and Jeonnam regions experienced a decline in growth and stability, but showed improved profitability.

According to the Gwangju-Jeonnam Regional Headquarters of the Bank of Korea on the 27th, the '2023 Gwangju-Jeonnam Regional Corporate Management Analysis Results' announced by the headquarters showed that the sales growth rate, a growth indicator for 66,047 manufacturing and non-manufacturing companies in Gwangju and Jeonnam, was 5.8%, down 7.1 percentage points from a year earlier (12.9%). The total asset growth rate also dropped by 5.3 percentage points to 6.7% from 12.05% the previous year.

The operating profit margin, an indicator of profitability, stood at 0.0%, up 9.8 percentage points from -9.8% a year earlier, while the pre-tax net profit margin rose by 10.0 percentage points to 0.2% from -9.8% the previous year.

The debt ratio, an indicator of stability, increased by 15.3 percentage points to 229.5% from 214.2% last year, and the dependence on borrowings rose by 1.8 percentage points to 47.9% from 46.1% the previous year.

Compared to the national average, the region's growth is at a favorable level, but profitability and stability are relatively weak.

In the case of manufacturing, all indicators?growth, profitability, and stability?deteriorated. For non-manufacturing, profitability improved, mainly due to the electricity and gas industries, but both stability and growth declined.

Compared to the national average, the manufacturing sector in Gwangju and Jeonnam showed higher sales growth rates in electronic, visual, and communication equipment (Gwangju-Jeonnam 4.2%, nationwide -14.5%) and food products (Gwangju-Jeonnam 9.5%, nationwide 1.6%).

However, operating profit margins were lower than the national average in sectors such as electrical equipment (Gwangju-Jeonnam -9.3%, nationwide 2.0%) and primary metals (Gwangju-Jeonnam -4.3%, nationwide 4.3%).

In the non-manufacturing sector, sales growth rates for electricity and gas (Gwangju-Jeonnam 22.2%, nationwide 0.1%) and transportation and warehousing (Gwangju-Jeonnam -0.8%, nationwide -9.0%) were higher than the national average, but operating profit margins for electricity and gas (Gwangju-Jeonnam -6.7%, nationwide 0.7%) and transportation and warehousing (Gwangju-Jeonnam 1.5%, nationwide 5.3%) were lower than the national average.

An official from the Gwangju-Jeonnam Regional Headquarters of the Bank of Korea said, "Compared to the national average, companies in the Gwangju and Jeonnam regions show favorable growth, but their profitability and stability remain relatively weak."

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