SAMSUNG HEAVY INDUSTRIES
Samsung Heavy Industries Co Ltd (SHI) is a publicly quoted company incorporated in South Korea in 1974. It is a constituent part of the Samsung Group, South Korea's second largest chaebol. Shipbuilding is its core business, accounting for around 70% of sales but SHI is also active in a number of other businesses. As a matter of fact SHI consists of three divisions: Shipbuilding & Plants Division, Digital & Environment Business Division and Construction Division.
SHI has expanded significantly in recent years tripling its output since 1995 - and is now the world's third largest merchant shipbuilder after Hyundai Heavy Industries and Daewoo Heavy Industries.
Given the high level of indebtedness in 1997 as well as net losses in 1997, SHI had to conduct a restructuring of its loss-making businesses and concentrate into the shipbuilding construction and industrial machinery segments. The financial structure has improved since then as total borrowings have contracted through the disposition of business segments and following a capital increase in 1998 and 1999. Profit recorded in 1998 and 1999 are mainly due to a reduction of interest expenses, although its financial expenses burden is still substantial.
The following tables illustrate the profitability of SHI as well as the improvement of its financial structure:
|Non operating expenses
In fact, the company conducted a self-restructuring plan (selling real estate and their construction equipment plant - forklifts - to Volvo) but there is no evidence of debt-forgiveness, debt or interest relief or any financial support given to the company by the government. This situation has been confirmed by the investigation in Korea
As a result the investigation concludes that SHI has not received subsidies through debt or interest relief.