SEOUL, - A deceleration in sales growth and weakening profitability among South Korean companies was observed last year, according to data revealed by the Bank of Korea on Wednesday.
According to a news release by Yonhap News Agency, corporate sales rose 15.1 percent last year, down from the 17 percent increase in the previous year. The data is derived from a review of approximately 910,000 companies subject to external audits. Concurrently, these firms' profitability metrics also weakened, with the operating profit to sales ratio dropping to 4.5 percent, compared with 5.6 percent in the previous year. The net profit to sales ratio likewise diminished, going from 6.5 percent to 4.6 percent over the specified period.
Factors contributing to this trend included increased borrowing costs and rising raw material prices, notably oil. By sector, manufacturing businesses recorded a sales growth reduction to 14.6 percent from 18.1 percent, while sales growth in the nonmanufacturing sector dropped to 15.4 percent from 16.2 percent in the previous year.