Corporate growth and profitability improved in the first quarter of this year.
According to the Bank of Korea's "First Quarter Corporate Management Analysis Results" released on June 23, the revenue growth rate for external audit companies rose from 2.5% in the fourth quarter of last year to 13.5% in the first quarter of this year.
The electronics and telecommunications equipment sector led the increase in manufacturing revenue growth, soaring from 28.9% to 75.7%. The Bank of Korea noted that excluding this sector, the overall revenue growth rate would drop from 13.5% to 4.6%.
Imi-Joo, head of the Bank of Korea's Corporate Statistics Team, stated, "A significant portion of the revenue increase came from semiconductors. Excluding Samsung Electronics and SK Hynix, the revenue growth shifted from a decline of 0.6% last quarter to an increase of 4.6% this time." She added, "While semiconductors have made a substantial contribution, other sectors have also shown balanced growth."
The revenue growth rate for the manufacturing sector increased from 4.7% in the previous quarter to 21.1% in the first quarter. The revenue growth rate for machinery and electronics reached 52.1%, benefiting from the ongoing strong semiconductor market.
In the non-manufacturing sector, industries such as transportation and retail rebounded from a decline of 0.3% to a growth of 3.7%. The transportation sector improved from -2.5% to 8.1%, driven by rising shipping costs due to geopolitical risks in the Middle East and increased air passenger demand. Retail also saw growth, rising from 5.2% to 7.1%, reflecting strong sales across the distribution sector.
The operating profit margin for all surveyed companies in the first quarter was 13.2%, up from 6.0% in the same period last year. The manufacturing sector saw an increase from 6.2% to 18.1%, primarily due to machinery, electronics, and petrochemical industries, while the non-manufacturing sector experienced a slight decline from 5.9% to 5.7%, mainly in transportation.
The machinery and electronics sector's profit margin surged from 6.9% to 32.5%, benefiting from rising memory prices and reduced fixed costs. The petrochemical sector also saw an increase from 5.7% to 9.7%, benefiting from improved refining margins amid geopolitical risks in the Middle East.
In terms of financial stability, the debt ratio for all companies in the first quarter decreased to 87.0% from 88.9% in the previous quarter. The reliance on borrowed funds also fell from 24.4% to 23.9%.
Looking ahead to the second quarter, Imi-Joo stated, "The semiconductor manufacturing sector is expected to continue its strong performance driven by robust AI demand, leading to overall improvements in corporate indicators. However, uncertainties in corporate management will persist due to fluctuations in raw material prices, supply chain impacts from China in steel, chemicals, and automotive sectors, and U.S. tariff barriers."
* This article has been translated by AI.
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