Chapter 312 - Prototype Development of the Joint Venture Company (1) – Part 1
GH Mobile was doing very well. Since the new co-president—Jang-Hwan Song joined GH Mobile, its sales revenue was on the rise, and the newly developed product—AM083 Assembly was selling well. The employment was stable too. GH Mobile’s turnover rate was almost zero. Moreover, the company’s debts were continuously being reduced.
During the meeting with the internal auditor, the internal auditor was speaking about the company’s profit and loss.
“According to our semi-annual financial report, our sales revenue was 10% and our ordinary income was 3%. If we assume that we will have about the same performance for the rest of the year, our annual sales revenue would be approximately 80 billion won. If we apply 3% of the ordinary income, our yearly profit would be 2.4 billion won.”
“Hmm.”
“We can, of course, will be able to distribute dividends to the major shareholder of this company—President Goo after we reserve some retention money.”
“The possible amount of the dividend would be about 2 billion won then.”
“Theoretically yes, that’s correct. However, we have debts to pay off. We can gradually pay off the loans from the bank, but we will have to pay the creditor companies who we had or are still having a business with. If they find out that we distribute the dividend to the shareholder out of the company’s profit without paying their money, it’s evident that they will get very upset.”
“So, you are suggesting we will have to use the company’s profits to pay the debts first.”
“The company’s debts also belong to the major shareholder. If we reduce the company’s debts, that also means the major shareholder’s debt is reduced.”
“Our next balance sheet will look very pretty.”
“That’s right, sir. Your monthly salary is 15 million won. I think it would be a wise choice to be content with the salary for now until we pay off our debts. That’s what President Jang-Hwan Song is hoping as well.”
“I understand what you mean. Let’s pay off the debts first.”
“Thank you, sir.”
A while after the internal auditor left Gun-Ho’s office, President Jang-Hwan Song came into the office.
“I just talked with the internal auditor. I think you made a good call on using our company’s profit to pay off debts first because our debt ratio is still higher than the average debt ratio in the industry. In order to successfully register with KOSDAQ, our debt ratio needs to be 1.5 times lower than the industrial average debt ratio.”
“I know that.”
“Did you already move in there?”
“Yes, I did.”
“It’s 30 pyung large. It must be very spacious for one person living. Did you say you are planning to get married this fall?”
“Actually, I am living with my girlfriend there.”
“Without getting married yet?”
Jong-Suk grinned and said,
“Yeah, it just happened that way. I was actually thinking of getting a new car. It’s kind of embarrassing to drive that old car, and my girlfriend doesn’t seem to like it either.”
“I can get you one.”
“Haha. You are kidding me, right?”
“President Song actually asked me to get you a new car, under 2000 CC.”
“Are you serious?”
“Since you are a director, he said it’s totally fine for the company to get you a new car.”
“I will ask President Song and see if he is serious about it.”
“Man, I am the owner of this company. I will get you a new Santa Fe 2.0, and it is owned by the company but you will be the one who is using it. When you see President Song, just thank him.”
“Thank you, bro.”
“Don’t mention it. It’s my early wedding gift for you.”
“I do really appreciate it, bro. I haven’t done much for you yet.”