Chaebol Cash Reserves
The combined cash reserves of the 10 major Korean business groups exceeds 125 trillion won.
According to chaebul.com, the groups’ cash holdings on a consolidated basis reached 125.41 trillion won (US$116.97 billion) as of the end of Sept. this year to record a 15.1 percent increase from the end of last year. The cash holdings include cash, cashable assets, and short-term financial products.
By company, Samsung Electronics’ increased from 54.5 trillion won (US$50.8 billion) to 66.95 trillion won (US$62.4 billion) during the period to show the highest rate of increase. Hyundai Motor Company’s cash reserves went up from 21.75 trillion won (US$20.29 billion) to 25.06 trillion won (US$23.36 billion) during the same period, while LG Display’s increased by 40 billion won (US$37 million) to 2.36 trillion won (US$2.20 billion).
LG Electronics, Hyundai Mobis, and SK Hynix boosted their cash holdings as well, based on their strong sales performances this year. LG Electronics’ cumulative operating profits for the first three quarters of this year increased by 50.2 percent year-on-year, and its cash reserves went up from 2.65 trillion won (US$2.47 billion) to 2.95 trillion won (US$2.75 billion). Those of SK Hynix and Hyundai Mobis exceeded 3.7 trillion won (US$3.4 billion) and 3.39 trillion won (US$3.2 billion) with a rate of increase of over 30 percent each.
In contrast, Hyundai Heavy Industries, POSCO, and SK Innovation had to witness a plunge in their cash holdings due to plummeting sales. The amount fell from 6.03 trillion won (US$5.62 billion) to 5.56 trillion won (US$5.19 billion) for Hyundai Heavy Industries, which recently let go of 30 percent of its executive members, between the end of 2013 and June 2014. POSCO’s decreased by 1.65 trillion won (US$1.54 billion) to 5.53 trillion won (US$5.16 billion) between January and September. The steelmaker is planning to cut its consolidated annual investment by 2.6 trillion won (US$2.4 billion) from a year earlier to 6.2 trillion won (US$5.8 billion).