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The Korea Herald
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THE INVESTOR
March 29, 2024

Economy

1 in 10 firms unable to meet interest expenses

  • PUBLISHED :April 19, 2017 - 10:48
  • UPDATED :April 19, 2017 - 10:48
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[THE INVESTOR] One in 10 leading companies last year were unable to interest on loans, a corporate analysis indicated on April 19.

The analysis by CEO Score, which follows financial details of conglomerates, showed that among 357 companies checked in the study, 39 had an interest coverage ratio of under one.

Twenty-seven of the analyzed firms fell to negative ratios due to operating losses last year, including Samsung Heavy Industries, Samsung SDI, Daewoo Engineering & Construction and POSCO Engineering & Construction. Doosan Engineering & Construction and 11 other companies showed a ratio of under one despite ending in black in operational profit.

Fourteen companies were categorized as zombie companies, with four of them in the shipping industry: Daewoo Shipbuilding & Marine Engineering, Hanjin Heavy Industries and Construction, STX Offshore & Shipbuilding and STX Heavy Industries.

IT-related companies were in the best condition in terms of the ratio, averaging 21.1. The automotive sector stood at 15.3, petrochemical at 12.3 and services at 12.1.

By Alex Lee and newswires (alexlee@heraldcorp.com)

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