[Apha Biz=(Chicago) Reporter Paul Lee] Asiana Airlines' debt ratio has continued to rise and profitability has declined as the merger of Korean Air (003490) and Asiana Airlines (020560) has been delayed due to the delay in the announcement of the results of overseas competition authorities' screening. The financial burden is likely to increase further while the merger drifts.

According to a semi-annual report published in the Electronic Disclosure System (DART) on the 7th, Asiana Airlines' financial soundness is weak. The company's debt ratio reached 1,741% in the first half of this year. Critics point out that the dependence on borrowings also reached 56 percent, which could add to the burden on Korean Air, an HR company.

Asiana Airlines' debt ratio soared to 3781.4% as of the third quarter of last year, but fell sharply to 1,482% as it posted net profit due to the effect of the exchange rate in the fourth quarter. The lower debt ratio has risen again since the first quarter of this year. From the first quarter, the debt ratio exceeded 1,500% and then exceeded 1,700% in the first half of this year.

The debt ratio is a ratio that shows how much debt accounts for among the assets held by a company, which is an important indicator of the company's financial soundness. Generally, the debt ratio of less than 100% is considered the standard, and the debt ratio of less than 200% is considered the appropriate debt ratio depending on the proportion of short-term debt. In the aviation industry, the debt ratio is higher than that of ordinary companies due to the nature of the industrial structure of leasing aircraft, but even considering this, Asiana Airlines' debt ratio is very high.

Asiana Airlines' lease debt is also a drag on financial indicators. Asiana Airlines' lease debt totaled 4.3379 trillion won as of the half-year. The amount spent in the first half of this year on interest on lease debt also amounted to 111.5 billion won. This is half of the operating profit of KRW 201.4 billion in the first half, which is also the cause of Asiana Airlines' net profit and loss. Asiana Airlines posted a net loss of 60.2 billion won in the first half of this year, although it posted sales of 3.254 trillion won and operating profit of 201.4 billion won.

 

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