CEO Score: Survey of 237 Listed Companies
Cumulative Free Cash Flow in Q3 Reaches Nearly 70 Trillion Won
Samsung Electronics Tops the List with About 19 Trillion Won
SK Hynix Posts Largest Increase of 8 Trillion Won
Among the top 500 companies in South Korea, listed firms saw their cumulative free cash flow (FCF) for the third quarter of this year increase by more than 20 trillion won compared to a year ago. This growth is attributed to companies such as Samsung Electronics and SK Hynix, which benefited from the improved semiconductor market conditions.
According to CEO Score, a corporate data research institute, on December 10, the cumulative free cash flow for the third quarter of this year among 237 listed companies (excluding financial firms) out of the top 500 reached 69.6498 trillion won. This represents an increase of 20.5959 trillion won (42.0%) compared to the same period last year (49.0539 trillion won).
Free cash flow is calculated by subtracting capital expenditures from cash flow generated by operating activities. It is widely used as an indicator of a company's actual financial health and its capacity for dividends.
In the third quarter of this year, cash flow from operating activities increased by 24.5% to 164.4827 trillion won, while capital expenditures rose by 14.2% to 94.8329 trillion won. The larger increase in operating cash flow compared to capital expenditures is interpreted as the main factor behind the rise in free cash flow. Additionally, the number of companies with increased free cash flow (127) outnumbered those with a decrease (110).
As of the third quarter, Samsung Electronics recorded the highest free cash flow at 19.038 trillion won, up 42.6%. SK Hynix also saw its cash flow from operating activities nearly double, resulting in a 138.6% increase in free cash flow to 14.0395 trillion won. Other companies ranking high included Kia (4.2659 trillion won), Korea Gas Corporation (3.9633 trillion won), HD Hyundai Heavy Industries (3.4552 trillion won), Korea Electric Power Corporation (2.8728 trillion won), and Hyundai Mobis (2.3694 trillion won). On the other hand, four companies-Hyundai Engineering & Construction (-1.4727 trillion won), LG Energy Solution (-1.4511 trillion won), Doosan Enerbility (-1.3064 trillion won), and LG Display (-1.2106 trillion won)-recorded negative free cash flow exceeding 1 trillion won.
Compared to last year, SK Hynix posted the largest increase in free cash flow, rising by 8.1543 trillion won. It was followed by Samsung Electronics (up 5.6919 trillion won) and Hanwha Ocean (up 2.9231 trillion won). Hyundai Motor Company recorded the largest decline in free cash flow, dropping by 72.0% to 1.3651 trillion won due to delays in customs negotiations. Hyundai Engineering & Construction, SK Telecom, and Kia also saw their free cash flow decrease by more than 1 trillion won. By industry, the IT electrical and electronics sector led the growth with a total of 29.7516 trillion won, up 96.1%. In contrast, the automobile and parts sector recorded the largest decline, falling by 3.9424 trillion won.
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