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Posted by Germaine-Jay Thursday, May 6, 2021

YG Entertainment & SM Entertainment downgraded as businesses by Korean Exchange

AKP STAFF

YG Entertainment and SM Entertainment have been downgraded as businesses by the Korean Exchange.

The Korea Exchange recently announced both labels have dropped levels from top blue-chip companies to regular mid-sized businesses because of poor financial performance and losses. SM Entertainment was previously promoted to a blue-chip company in March of 2008, while YG Entertainment was promoted in April of 2013.

According to the Korea Exchange, which is the sole securities exchange operator in South Korea, companies achieve blue-chip level if their equity capital reaches over 70 billion Won ($62,342,476 USD) and an average market capitalization of over 100 billion Won ($89,060,680 USD) over the past 6 months. The companies also need to maintain a net profit of 3 billion Won ($2,671,750.80 USD), sales of over 50 billion Won ($44,529,180 USD), and an average return on equity of 5% over the past 3 years.

Though both SM Entertainment and YG Entertainment meet all other requirements, their net profit and return on equity have fallen dramatically, which caused their demotion. Over the past 3 years, SM Entertainment averaged a loss of 24.4 billion Won ($21,731,579.40 USD) yearly, while YG Entertainment averaged a loss of 1.8 billion Won ($1,603,149.30 USD) yearly.

  1. misc.
  2. SM ENTERTAINMENT
  3. YG ENTERTAINMENT
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toycactus
toycactus140 pts Thursday, May 6, 2021 8
Thursday, May 6, 2021

i guess this is the reason why jype is so tight on their budget, so they can maximise their net profit...but then again this is sm and yg, they'll probably figure out a way to get back on top

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Mimi20001
Mimi2000152 pts Thursday, May 6, 2021 2
Thursday, May 6, 2021

they probably focused too much on South East Asia lately. little did they know, we are not the biggest consumers. aka we dont spend much money on their actual products. we just watch the videos on youtube for free. it gave them the false idea that we spend money on them

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