Corporate profitability improved in 2015 as more Korean companies implemented cost-cutting measures. They also benefited from lower commodity prices, according to data from the Korea Exchange.

The combined net profit of 516 firms listed on the benchmark Korea Composite Stock Price Index -- excluding financial firms and those that underwent mergers or divisions -- rose 3 percent from 2014 to 635 trillion won ($556 billion) last year. 


“After bottoming out in 2014, listed companies are showing better profit margins,“ said an analyst at Samsung Securities. “The improvement was due largely to the lower prices of commodities such as crude oil that was combined with the belt-tightening measures taken by the firms.”

Operating profits rose 14.22 percent during the same period, while the firms’ operating profit margin, a gauge that helps determine management capacity, rose 6.2 percent from 2014. Net profit margin also improved to 3.88 percent from 3.65 percent.

Excluding market heavyweight Samsung Electronics whose sales account for 12.24 percent of sales at KOSPI-listed firms, the combined operating income and net profits were found to have increased by 17.6 percent and 16.2 percent, respectively.

However, listed firms suffered a blow to sales, which were down 3 percent at 1,639 trillion won, the Korea Exchange data showed.

Of the 516 firms, nearly 77 percent posted saw net profits, and the rest logged losses in 2015.

The telecommunications sector led the pack, followed by the electricity and gas, medical equipment and metal sectors. Stocks issued by construction and machinery companies, however, reported consecutive annual losses.

The operating profits and net profits of firms listed on the tech-heavy KOSDAQ moved up 8.66 percent and 2.74 percent, respectively, in 2015.

By Park Han-na (hnpark@heraldcorp.com)