"Indeed, the Era of Power Cables!" LS Cable & System's Koo Ja-yeop and Koo Bon-gyu Father-Son Duo Enjoy Skyrocketing Salaries

[Korea Financial Times, Shin Haeju] Koo Ja-yeop, Chairman of LS Cable & System, and his son Koo Bon-gyu, President of the company, saw their salaries increase by up to 31% last year compared to the previous year. This sharp rise in compensation has drawn attention, especially considering the company’s net profit dropped by more than half during the same period.

According to LS Cable & System's 2024 business report released on April 1, Koo Ja-yeop earned KRW 4.796 billion, while Koo Bon-gyu received KRW 1.508 billion last year. Chairman Koo Ja-yeop is the father of President Koo Bon-gyu. Compared to the previous year, Koo Ja-yeop's salary increased by 8.7%, and Koo Bon-gyu’s surged by 31.07%.

The combined salaries of the father-son duo amounted to KRW 6.3 billion, which accounted for 79.41% of the total director compensation of KRW 7.939 billion at LS Cable & System in 2024.

Last year, LS Cable & System reported sales of KRW 6.7653 trillion and an operating profit of KRW 274.5 billion, marking increases of 8.82% and 18.06%, respectively, compared to the previous year. The operating profit margin rose by 0.32 percentage points to reach 4.06%, outperforming competitor Taihan Cable & Solution’s margin of 3.50%.

However, net profit for the year plummeted by 57.59%, settling at KRW 44.7 billion. While the company generated more revenue from its core business than the previous year, the actual cash retained was cut in half. Nevertheless, Koo Ja-yeop and Koo Bon-gyu received compensation equivalent to 14% of the net profit.

LS Cable & System explained the drop in net profit, stating that it was due to a significant increase in nuclear power plant safety contributions for 2024 and foreign exchange losses from the sharp rise in exchange rates in December last year.

Koo Ja-yeop received KRW 2.684 billion in base salary, KRW 2.112 billion in bonuses, and KRW 1 million in other income (such as welfare benefits).

Chairman Koo Ja-yeop received a salary of KRW 2.684 billion, a bonus of KRW 2.112 billion, and other employment income (welfare support) of KRW 1 million.

His salary consisted of a base salary of KRW 1.522 billion, allowances of KRW 262 million, and a role-based salary of KRW 900 million. Compared to the previous year, his salary increased by 2.62%, while his bonus rose by 17.79%.

Koo Bon-gyu earned a salary of KRW 890 million, KRW 610 million in bonuses, and KRW 8 million in other income. His salary included KRW 544 million in basic pay, KRW 99 million in position allowances, and KRW 246 million for role-based pay. Bonuses consisted of KRW 389 million for short-term performance incentives and KRW 221 million for long-term performance incentives.

LS Cable & System determines executive performance bonuses by considering both quantitative and non-quantitative indicators. The non-quantitative indicators assess improvements in competitive capabilities, while the quantitative indicators evaluate pre-tax profit for short-term incentives and sales and operating profit target achievement rates for long-term incentives. Last year, LS Cable & System achieved its highest sales ever.

The total compensation for the five registered directors, excluding outside directors and audit committee members, amounted to KRW 7.939 billion. Of this, the father-son duo, Koo Ja-yeop and Koo Bon-gyu, accounted for 79.41%, marking a 1.68 percentage point decrease from the previous year.

Employee compensation also showed an upward trend. Executive salaries increased by 17.96% compared to the previous year, while employee salaries rose by 5.68%.

Executive salaries rose by an average of 17.96%, while employee salaries increased by just 5.68%. Among non-registered executives (excluding overseas employees), the average annual salary was KRW 388 million per person.

For employees—including regular staff (1,985) and temporary workers (145)—the total payroll amounted to KRW 176.63 billion last year, with an average individual salary of KRW 83 million.

Shin Haeju (hjs0509@fntimes.com)