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Surging Korean won playing on shipbuilders' minds

Surging Korean won playing on shipbuilders' minds

Seoul: The surge in the Korean won's value could hinder the performances of Korean companies next year, especially if the won-dollar rate falls to the 1,100 level, a Dong-A Ilbo-commissioned study said yesterday.
In developing next year's business plans, major domestic companies are agonizing over the won's surging value and its negative effects on key performance indicators such as revenues and operating profits. Many experts say export-dependent companies will be hit hard if the won rises to 1,100 to the dollar.
Dong-A commissioned Samsung Securities analysts in each industry to forecast next year's performance for 80 major Korean companies, including Samsung Electronics, the Hyundai Kia Automotive Group, LG Electronics, POSCO and Hyundai Heavy Industries, based on a won-dollar rate of 1,130 won.
Their study indicated drops of 2.8 percent in revenue, 10 percent in operating profit, and 4.8 percent in net profit on average from existing forecasts. The rate of 1,130 was the average forecast for next year by Samsung Economic Research Institute.  The movement of the won is the latest headache for Korean shipbuilders facing a sudden drought in orders. [06/10/09]


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