Korean companies achieved improved their business results last year. Their sales took an upturn after two years of declining, with their operating profit-to-sales ratio reaching the highest level in six years.
Their debt-to-equity ratio also fell to below 100 percent thanks to a decline in commodity prices and the recovery of the housing market.
The Bank of Korea issued on May 30 an analysis of corporate performance for 2016. The analysis was conducted with 20,888 externally-audited companies with more than 12 billion won assets.
Their sales growth reached 1.1 percent last year, a turnaround from -0.3 percent in 2014 and -2.4 percent in 2015. The sales of the manufacturing sector remained in the negative territory, but showed improvement from -4.2 percent in 2015 to -1.4 percent in 2016.
The sales of the non-manufacturing sector rose 4.4 percent last year, up from 0.1 percent a year ago. They showed a great improvement in profitability, with their operating profit-to-sales ratio estimated at 6.1 percent last year, up 0.9 percentage point from a year ago. This figure was highest since 2010 (6.7%).