South Korea’s largest conglomerate Samsung Group saw overall operating profit of its units in the second quarter improve year over year, mainly driven by its core electronics unit Samsung Electronics Co. that surprised the market with better than expected operating profit of more than 8 trillion won ($7.2 billion). Doosan Group that went through sweeping group-wide restructuring also performed better than a year ago.

According to the analysis on earnings of the country’s top 10 conglomerates by Korea’s market data provider FnGuide on the request by the Maeil Business Newspaper on Sunday, Samsung Group outperformed other nine groups by a large margin during the April-June period. Of Samsung Group’s 13 major listed companies, 11 have released their earnings so far that tallied 8.4 trillion won, up a whopping 42.6 percent on year from 5.9 trillion won.

In particular, operating profit of Samsung Electronics rose by 1.2 trillion won on year, while Samsung Heavy Industries narrowed its operating losses by 1.3 trillion won. However, excluding Samsung Electronics’ earnings, total operating profit of the 10 other units amounted to 251.4 billion won only, suggesting uneven growth throughout the company.

Doosan Group and CJ Group also saw overall operating income grow about 10 percent from a year ago. Doosan’s four business arms earned total 743.9 billion won in operating profit in the second quarter ended in June, up 13.3 percent from 656.8 billion won a year ago. The group-wide growth in profit was mainly driven by Doosan Infracore Co. and Doosan Heavy Industries & Construction Co. whose operating income jumped 35.0 percent and 15.4 percent, respectively. Doosan Engine Co. also returned to profits. Among CJ Group’s major units, CJ Cheiljedang Corp. and CJ Korea Express Corp. respectively saw operating profit gain 9.8 percent and 33.4 percent from the previous year, but operating profit of CJ Freshway Corp. and CJ CGV Co. plunged 23.4 percent and 90.1 percent, respectively.

Korea’s largest auto group Hyundai Motor Group raked in 4.3 trillion won in overall operating income of its nine affiliates, up 6.6 percent from 4.07 trillion won a year ago. Hyundai Glovis Co. (23.6 percent) and Kia Motors Corp. (18.5 percent) and Hyundai Mobis (13.0 percent) all fared better by more than 10 percent from a year ago. However, the company’s core unit Hyundai Motor Co.’s operating profit inched up a mere 0.6 percent on year, dragged by sluggish demand in emerging markets.

Kim Joon-seong, an analyst at Meritz Securities Co. expected that its overseas shipments will shrink even further on slow demand in emerging countries and the U.S.

Combined operating profit of Lotte Group’s three business arms rose 4.5 percent on year to 889.4 billion won. Lotte Fine Chemical Co. (170.9 percent) and Lotte Chemical Corp. (8.5 percent) were lucrative, but Lotte Shopping Co. saw its operating profit slide 15.4 percent on year. Hyundai Heavy Industries Co. staged a dramatic turnaround from an operating loss of 170.9 billion won last year to a surplus of 557.2 billion won this year.

In contrast, SK Group and GS Group both saw their group-wide operating income tumble more than 20 percent on year. SK Group’s core unit SK Innovation Co.’s operating profit rose 13.3 percent, but the other main business SK Hynix Inc.’s operating income plummeted 67.1 percent, dealing a blow to the group. Combined operating income of the group’s five key units in the second quarter slipped 27.5 percent on year to 2.05 trillion won.

Two of GS Group’s four affiliates that announced their earnings saw their combined operating profit slip more 20 percent on year. GS E&C Corp.’s operating profit nosedived 40.6 percent on year, more than erasing a 14.0 percent gain in operating profit of GS Homeshopping Inc.

Total operating profit of LG Group’s eight business arms dropped 7.1 percent on year to 1.5 trillion won in the second quarter. Whereas its core unit LG Electronics Inc. reported earnings that more than doubled from a year ago, LG Display Co.’s operating income contracted to one tenth of last year`s earnings. The country’s largest steel making Posco Co. and its affiliate Posco Daewoo Corp. also saw their operating income drop on year.

By Choi Jae-won

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]