Friday, June 5, 2020
Listed Companies Reduce Dividend Payments in 2019
A Result of Worsening Business Performance
Listed Companies Reduce Dividend Payments in 2019
  • By Yoon Young-sil
  • March 5, 2020, 12:09
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Listed companies cut their dividend payments last year.

Market research firm FnGuide said on March 4 that 860 KOSPI- and KOSDAQ-listed companies are expected to pay a cash dividend of 27,413.2 billion won for the business year of 2019. Previously, the amount hit an all-time high of 31.94 trillion won in 2018.

The dividend payment by listed companies, which had been 21 trillion won or so in 2015, rose to 23 trillion won in 2016, 27 trillion won in 2017, and over 30 trillion won in 2018. With the stewardship code introduced, those companies increased their dividend payment to a large extent to enhance the shareholder value.

However, things changed in 2019, when their business performance deteriorated. KOSPI-listed companies’ total operating and net profits are estimated to have dropped 34.1 percent to 110.5 trillion won and 43.2 percent to 68.1 trillion won last year, respectively.

In 2018, Samsung Electronics paid the largest amount of dividend in the group, 8,453.2 billion won, followed by SK Hynix (1,026 billion won), Hyundai Motors (817.9 billion won), POSCO (800 billion won) and KB Financial (759.7 billion won). Last year, SK Hynix and Hyundai Motors reduced their dividend payments to 684 billion won and 807.9 billion won, respectively.

Likewise, SK Innovation reduced its dividend payment from 698.3 billion won to 260.9 billion won, LG Chem from 413.6 billion won to 137.9 billion won, and Lotte Chemical from 359.9 billion won to 229.6 billion won.

The annual operating profit of KOSPI-listed companies has been estimated to increase 29.9 percent to 144.9 trillion won this year. More recently, however, an increasing number of securities companies are lowering their operating profit estimates for the first quarter of this year in the wake of the spread of COVID-19.