Corporate growth slows, but profitability improves in 2025: BOK

Korean companies reported slower sales growth in 2025 due to a global oversupply of petrochemicals, but their profitability improved on higher semiconductor prices, the central bank said on Wednesday.

The combined sales of 34,456 companies subject to external audits rose 2.5 percent in 2025 from a year earlier, slowing from a 4.2 percent growth in 2024, according to data from the Bank of Korea (BOK).

Sales growth in the manufacturing sector slowed to 3.2 percent from 5.2 percent a year earlier due to sluggish performances in the oil refining and chemical industries amid global structural overcapacity and depressed profit margins.

Sales growth among nonmanufacturing businesses fell to 1.6 percent from 3 percent over the same period, dragged down by weaker performance among automobile companies affected by U.S. tariff measures.

However, profitability indicators improved.

The operating profit margin of the surveyed companies stood at 6.2 percent last year, up from 5.4 percent a year earlier, marking the highest yearly operating profit margin since 2021, when the figure came to 6.85 percent.

The manufacturing sector's operating profit margin expanded to 6.9 percent from 5.5 percent, driven by higher global semiconductor prices amid robust demand related to AI.

Financial stability indicators also strengthened.

The debt-to-equity ratio declined to 98.3 percent last year from 103.4 percent a year earlier, falling below the 100 percent level for the first time since 2020.

Their borrowing dependence also eased to 27.3 percent from 28.4 percent over the cited period, the BOK data showed.

Yonhap