Operating Profit of KOSPI Listed Companies in Q1 Reaches 50.51 Trillion KRW, Up 14% Year-on-Year

[Asia Economy Reporter Minji Lee] The sales and operating profits of KOSPI-listed companies improved in the first quarter of this year compared to last year.

According to the "First Quarter Settlement Results of the Securities Market" announced on the 18th by the Korea Exchange and the Korea Listed Companies Association, the consolidated financial statements submitted by 608 listed companies with December fiscal year-end (excluding 71 newly established or companies with non-standard audit opinions out of 679 December fiscal year-end companies) showed that sales in the first quarter reached KRW 660.9141 trillion, an increase of 24.18% compared to the same period last year. Sales increased by KRW 128.6923 trillion compared to the same period last year.

Operating profit also showed an upward trend. Total operating profit reached KRW 50.5105 trillion, up 14% from KRW 44.1407 trillion in the same period last year. However, net profit recorded KRW 41.691 trillion, a decrease of 13.79%.

Even excluding Samsung Electronics, which accounts for about 12% of the total sales of companies listed on the securities market, both sales and operating profits increased. Sales of listed companies excluding Samsung Electronics amounted to KRW 583.1326 trillion, up 24.91% (KRW 116.2993 trillion), and operating profit increased by 4.69% (KRW 1.6313 trillion) to KRW 36.3891 trillion. This improvement was thanks to major conglomerates such as HMM (208.9%), SK (89%), SK Hynix (115%), SK Innovation (182%), Korean Air (665%), and Hyundai Steel (129%) reporting better results than a year ago.

However, net profit was estimated to have decreased by 26.33% to KRW 30.3663 trillion. The decline in net profit widened as the number of companies continuing losses or turning to losses increased. Korea Electric Power Corporation recorded an operating loss of KRW 7.7869 trillion, turning from an operating profit of KRW 565.6 billion last year, and companies such as Korea Shipbuilding & Offshore Engineering, HDC Hyundai Development Company, District Heating Corporation, and Hyundai Mipo Dockyard recorded losses in the first quarter due to cost burdens and individual corporate adverse factors.

By industry, sales increased in all 17 sectors. However, operating profit showed weakness in four sectors: construction (-28.42%), machinery (11.98%), non-metallic minerals (-7.83%), and electricity and gas (turned to loss).

The operating profit and net profit of 43 financial companies were KRW 12.9898 trillion and KRW 9.9008 trillion, respectively, down 5.61% and 5.71%. This was due to a hostile stock market environment reducing securities firms' profits and rising interest rates decreasing insurance companies' bond valuation gains. Securities firms' operating profit was KRW 1.6166 trillion, down 34.16% from the same period last year, and insurance companies' operating profit was KRW 2.2247 trillion, down 31.8%.