Posted August. 28, 2008 08:41,
Fifteen Korean firms included in this year`s Fortune Global 500 lag far behind the average of the top 500 global firms in assets, sales, net profit and workforce.
Domestic financial firms performed far worse than expected. The average sales of Korean financial institutions was around half of that of 121 financial companies recognized by Fortune magazine.
The Federation of Korean Industries in a report said, Three Korean newcomers were included on the list of the worlds 500 biggest companies since their sales increased from changes in accounting methods and takeover, not good performance.
The three firms were GS Holdings Corp., which began adding up the sales of its subsidiaries this year, Shinhan Financial Group, which included sales of LG Card, and Woori Financial Group, which summed up the sales of its subsidiaries including Kyongnam Bank.
Average assets of the 15 companies reached 96.18 billion U.S. dollars, reaching a mere 45.8 percent of average of the top 500 global firms at 210 billion dollars.
The average operating profit of the 15 Korean firms was 2.22 billion dollars, or 63.4 percent of the top 500 average of 3.5 billion dollars. The 15 had a workforce of 44,966 employees on average, a mere 40.9 percent of that of the top global 500 (109,965 employees).
The Korean firms` average operating profit was 5.4 percent, lower than 7.3 percent of the top 500.
Korean firms sales were better than expected, however, at 87.7 percent or 41.46 billion dollars as opposed to the top 500 average of 47.2 billion won.
Notably, the average sales the country`s top 11 non-financial firms including Samsung Electronics, LG Group, Hyundai Motor, POSCO and Hyundai Heavy Industries reached 46.8 billion dollars, one billion dollars bigger than the average of 500 global firms (45.8 billion dollars).
Average sales of Koreas four financial institutions of 26.6 billion dollars were a mere 51.4 percent of the average 51.8 billion dollars of financial institutions on the list.
The number of Korean firms on the top 500 global list increased by three from 12 in 2000 to 15 this year. Over the same period, the number of Chinese firms jumped from 12 to 30 and that of Indian firms grew from one to seven.
Eun Hyeon-cheol, researcher at the federation`s economic policy team, said, The smallest firm on the list had sales of 16.6 billion dollars. In Korea, only five firms earned sales of 10 billion to 15 billion dollars. It is also problematic that few Korean firms can be ranked in the future as the world`s 500 biggest firms..