KOREAN CHAEBOLS IN THE RED, COMBINED FINANCIAL STATEMENTS SHOW.

SEOUL, July 2 Asia Pulse - South Korean conglomerates experienced hard times last year as many reported deteriorating debt-equity ratio and shrinking profits, the Financial Supervisory Service (FSS) said Saturday.

Despite calls by the government to reduce debt and address liquidity shortfalls, chaebol groups like Hyundai saw aggregate debt ratio jump from 229 per cent in 1999 to over 477 per cent an year later.

A debt ratio is a benchmark indicator of liquidity that divides a company's total debt by it equity, and the government has insisted that companies keep it under 200 per cent.

LG, Hanjin, also saw their debt versus equity climb past 300 per cent year-on-year.

In addition, the combined financial statements turned over to the FSS by 13 groups, showed that eight including Hyundai, Saehan, Ssangyong, Hanjin, Tong Yang, and Hansol, posted deficits in overall income, with Hyundai claiming a deficit of 6.2 trillion won (US$4.76 billion) from a net profit of 74.5 billion won in 1999.

The figures, which did not include financial and insurance sectors, revealed that Saehan Industries, Ssangyong and Doosan experienced net income deficits for the second consecutive year. As a consequence, Ssangyong conceded that its was in negative net worth in 2000.

These figures were reflected in sales, with Hyundai again showing sales volume decline 11.5 per cent from 69.9 trillion won to 61.8 trillion won. Hansol, Kolon and Tong Yang also experienced losses in revenue.