Current Debts Grow Faster Than Non-current Debts
Market research firm CEO Score reported on April 21 that the total liabilities of the 366 South Korean companies that constitute the top 500 enterprises of South Korea and have submitted their settlement reports for last year were 1,524.5884 trillion won in 2020, up 5.4 percent from a year ago.
“The liabilities topped 1,500 trillion won as their current liabilities that must be repaid within this year increased more than their non-current liabilities that must be repaid in 2022 or later in the wake of COVID-19,” the firm explained.
In 2020, the 366 companies’ capital increased by 46.1692 trillion won (3.3 percent) and their debt ratio increased from 103.7 percent to 105.8 percent. Their total borrowings increased 5.4 percent to 810.8436 trillion won.
Their current liabilities added up to 779.7679 trillion won last year, up 6.6 percent from a year earlier. In that period, their non-current liabilities increased 4.2 percent. “The difference between the increments means that the quality of the debt deteriorated last year,” the firm pointed out, adding, “In addition, the ratio of current liabilities rose from 52.4 percent to 54.1 percent in 2020, which means those companies’ short-term debt repayment burden increased.”
The ratio amounted to 135.1 percent in the shipbuilding, machinery and facility sectors. Those reached 117 percent and 103.9 percent in transport and international trading, respectively.
Samsung Electronics’ current liabilities totaled 75.6044 trillion won, followed by those of Hyundai Motor Co. (59.4595 trillion won), Korea Electric Power Corp. (25.8812 trillion won), Kia (21.0976 trillion won), LG Electronics (20.2075 trillion won) and POSCO (16.855 trillion won).