Revenue of Listed Firms
The average sales increase rate of the companies listed on the Korean stock market turned negative last year.
The Federation of Korean Industries (FKI) analyzed the business results of non-banking listed companies for the period of January to September 2013, and announced on Feb. 13 that six out of the 10 business indices deteriorated when compared to the financial crisis of 2009.
First of all, the sale increase rate was 0.1 percent below zero. The percentage had reached 1.33 percent five year ago. The total asset growth rate was halved, from 7.81 percent to 3.04 percent between 2009 and 2013, while the tangible asset growth rate fell from 8.04 percent to 2.42 percent during the same period. The return on net sales, the net income to sales ratio, and the total borrowings to total assets were aggravated altogether as well.
In particular, 148 companies with gross sales of over one trillion won (US$940 million) showed poorer performance. Their sales growth rate was 0.48 percent below zero on average.
Meanwhile, the stability index took a positive turn compared to five years earlier. The debt ratio was lowered from 93.94 percent to 85.81 percent, and the capital adequacy ratio was improved from 51.56 percent to 53.82 percent. The times interest earned ratio increased from 3.46 times to 4.19 times, and the financial expenses to sales dropped to 1.30 percent.
“The partial improvement can be attributed to the companies’ conservative stance on their business,” said an industry expert, adding, “The results imply that the corporate sector is in a critical situation, losing their growth momentum.”