Decline to 1/5th
The ratio of Samsung Electronics’ operating profits to the combined profits of the companies listed on the Korea Composite Stock Price Index (KOSPI) has dipped below 20 percent.
According to the Korea Exchange (KRX) and the Korea Listed Companies Association, Samsung Electronics recorded 4.1 trillion won (US$3.7 billion) in operating profits in the third quarter of this year on a consolidated basis, which is equivalent to 19.1 percent of the total profits of the 488 surveyed companies. The percentage had been as high as 35.7 percent a year ago, and 31.3 percent in the previous quarter.
During the same period, Samsung Electronics’ sales were 47.4 trillion won (US$42.5 billion), to account for 10.7 percent of the listed companies’ combined sales, while the ratio had been 13.1 percent in the third quarter of 2013 and 11.6 percent in the second quarter of 2014. The net profit ratio was 30.2 percent – 4.2 trillion won (US$3.8 billion) vs. 14 trillion won (US$12.5 billion) – dropping by 9.1 percentage points and 5.1 percentage points from the same respective periods.
This year, Samsung Electronics’ quarterly business profits dropped from approximately 8 trillion won (US$7.1 billion) to 7 trillion won (US$6.3 billion) and then to 4.0605 trillion won (US$3.6365 billion). This is the first time since the last quarter of 2011 that its quarterly business profits failed to reach 5 trillion won.
Under the circumstances, Samsung Electronics' market cap ratio showed a significant decline as well. As of the end of the third quarter, its aggregate market value totaled 174.4024 trillion won (US$156.1983 billion), 14.47 percent of the KOSPI. The figures had been 201.3582 trillion won (US$180.3404 billion) and 17.24 percent a year ago.