Delayed Salaries for June-July... "Will Be Paid Soon"
Operating Loss Deepens with Debt Ratio Over 400%
It has been confirmed that Sambutogeon, recently accused of stock manipulation, has been withholding employee salaries for several months. This is analyzed to be due to liquidity drying up amid a debt ratio in the 400% range and continuous operating losses over three years.
According to the construction industry on the 11th, Sambutogeon, ranked 71st in this year's construction capability evaluation, paid the June salaries only after mid-last month. The original payday was the 25th of the month, so the payment was delayed by more than half a month. Not all salaries were paid in full. Payments were made differentially according to rank. Employees up to the manager level received 100% of their salary, but assistant managers received only 50%. Department heads and above are in arrears. The July salaries were also delayed, and it is known that only employees up to the assistant manager level have received payment so far.
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Concerns and complaints about the worsening company situation are also visible on the anonymous workplace bulletin board ‘Blind’. A poster, Mr. A, said, "Not only the salaries, but also the unpaid amounts such as subcontractor fees are enormous," adding, "The company’s situation is getting more difficult, so it is tough."
The salary arrears issue at Sambutogeon also surfaced in the first half of this year. A Sambutogeon official said, "As is known, the construction industry is very difficult these days," and "We will soon pay the overdue salaries."
Sambutogeon is famous as the first licensed company in domestic civil engineering and architectural construction. Its housing brands include Sambu Apartment and Sambu Renaissance, and its commercial facilities such as Star City and Centum City are cited as successful cases. It has also been actively involved in the public social overhead capital (SOC) sector.
However, as the construction industry as a whole staggered due to prolonged high interest rates and rising costs, Sambutogeon was also hit hard. According to the Financial Supervisory Service’s electronic disclosure system, Sambutogeon’s consolidated debt ratio in the first quarter of this year was about 422%. This worsened from 403% at the end of last year. The debt ratio is a representative indicator of financial soundness. A ratio below 200% is classified as normal. In the construction industry, a debt ratio above 300% is considered high risk.
Operating losses also reached 78.2 billion KRW as of the end of last year, marking three consecutive years of deficits. Cash flow is also worsening. Cash flow from operating activities decreased from minus 36.5 billion KRW in 2021 to minus 61.5 billion KRW in 2022, and further to minus 107.1 billion KRW last year. At least in the first quarter of this year, it increased by 25.2 billion KRW. Recently, Sambutogeon has been suspected of ‘manipulation’ related to its stock price rise after being classified as a Ukrainian reconstruction-related stock.
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