SK Hynix to invest big after good results in Q2

SK Hynix announced that it will spend more than 6 trillion won ($5.1 billion) this year to improve environmental safety and boost infrastructure, much more than expected.

The news came after the world’s second-largest memory chip producer reported good second-quarter results, including over 1 trillion won in operating profit for the sixth consecutive quarter.

In a related moved SK Hynix said last month it would launch a “salary sharing system” as part of its corporate social responsibility program, an unprecedented step for a conglomerate.

Its union and management agreed last month on a 3.1 percent salary increase for this year, and to share a portion of it with some 4,000 workers at companies that have partnership with SK Hynix. The companies employees with forfeit 10 percent of their raise, and the company will match it.

After the sharing, the employees of the chipmaker will see their income climb by 2.8 percent for this year.

The 4,000 employees work at SK Hynix partners in Icheon in Gyeonggi and Cheongju in North Chungcheong. Given that the salaries of SK Hynix workers totaled 1.6 trillion won last year, around 6.6 billion won will go to the workers at its partner companies.

“The decision by labor and management is meant to boost competitiveness in the chip-making business through further solidified partnerships and set a meaningful example for win-win cooperation,” said Park Sung-wook, CEO of SK Hynix, as he announced the plan.

SK Hynix has raised its spending on human resources -- including salaries, severance pay and benefits -- by an accumulated 94.6 percent from 2011 to 2014 to 2.43 trillion won.

Over the same period, the companies’ revenue jumped 64.7 percent, according CEO Score, a corporate management assessment site, on Monday. Individual salaries rose an average of 46 percent.

Revenue for the quarter ended June 30 advanced 18 percent year on year to 4.63 trillion won and operating profit jumped 27 percent to 1.4 trillion won, the company said last week.

Although the supply and demand situation for PC chips will remain “challenging” in the latter half of the year, the world’s No. 5 semiconductor said its expansive capital spending plan will help it from the long-term business perspective.

SK acquired the chipmaker in 2012.

BY SEO JI-EUN [seo.jieun@joongang.co.kr]