One in three Korean listed firms reported operating profits below market expectations in Q3, particularly impacted by weaknesses in the semiconductor and battery sectors, including Samsung and Hyundai. Overall operating profit totaled 50.14 trillion won, a 5.8% decline compared to forecasts, leading to slowed economic growth as GDP expanded only 0.1% in the quarter, far below the predicted 0.5%.
In the third quarter, one-third of the listed Korean firms reported operating profits that fell short of market expectations, with significant underperformance noted in the semiconductor and rechargeable battery sectors. As of the latest tally, 165 companies had disclosed their earnings, and a staggering 61.82 percent of those did not meet the anticipated results or exhibited larger losses compared to the previous year. Industry leaders such as Samsung Electronics, Hyundai Motor, and major battery manufacturers like LG Chem and Samsung SDI were among those missing the forecasts. This lackluster performance translated into earnings shocks for 57 companies, whose profits deviated by at least 10 percent from market predictions. The aggregate operating profit reported by these listed entities stood at 50.14 trillion won (approximately $35.83 billion), representing a 5.8 percent shortfall from forecasts. The overall economic ramifications have been evident, as demonstrated by the Bank of Korea’s (BOK) data reflecting a mere 0.1 percent growth in gross domestic product (GDP) for the July-September period, which significantly lagged behind the anticipated 0.5 percent increase.
The recent earnings report from Korean listed firms underscores a troubling trend in sectors crucial to the country’s economic health, particularly the semiconductor and battery markets. Following a period of rapid growth, the current underperformance has raised concerns about the sustainability of economic recovery. Notably, the period from July to September, typically a robust quarter, showed disappointing results, prompting analysts and governmental bodies to revise growth forecasts for the fiscal year ahead. This context highlights the interdependence of technological advancements and economic vitality in Korea.
In summary, the third-quarter earnings of Korean listed companies reveal a significant proportion that failed to meet market expectations, predominantly attributed to the challenges faced in the semiconductor and battery sectors. The disappointing economic indicators suggest a broader slowdown, prompting a reevaluation of growth projections by financial authorities. As the global demand for essential technology products wanes, the implications for Korea’s economic trajectory remain a pressing concern.
Original Source: www.koreatimes.co.kr
Leave a Reply