Story of a Big Player from Gangnam

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."

"When I talked with the internal auditor earlier about the profit and paying off the debts with it, we also talked about raising your salary, sir. Since we are generating profits, as the owner of this company, you probably want something in return. So, we are thinking to raise your monthly salary to 20 million won. What do you think, sir?"

"That's not necessary. We will soon have to negotiate the workers' wages with the labor union. I don't think this is the right time to raise the president's salary."

"What about changing your car then if you don't want to raise your salary? You are operating several companies now, and we think you shouldn't drive the car on your own all the time. So we are thinking of getting you a new car with a chauffeur."

"A new car? I do like my Land Rover and it runs very well. It wouldn't make me look any good if I drive around with a chauffeur at my age. Don't ever mention it to me again. I think you will need a new car since you are the one who is doing sales, and you drive a lot to meet a client."

"My Genesis is still new. It was the car I had since I worked for S Group. They let me keep it when I resigned from the position. The company provides me with gas costs and auto insurance. I don't think I will need a new car until we successfully go public."

"Hmm."

"I think maybe we should get a new car to Director Jong-Suk Park. He is now traveling a lot between the two factories in Jiksan Town and Asan City. He also often attends meetings for the plant managers with our customer companies. I saw his car the other day, and it looked a bit old."

"You're right. His Santa Fe is old. I know that because he was driving the same car when I used to go fishing with him to Pocheon City, which was years ago. It was not even a new car when he bought it at that time. I do believe he needs to change his car."

"You go all the way to Pocheon City just for fishing?"

"It was a long time ago."

"Since Director Park is a director, we can get him any car less than 2000 CC without any problem."

"You know what? Let me take care of this."

"Okay, sir."

Gun-Ho called for Director Jong-Suk Park,

"Hey, you are not that busy these days, right?"

"Yeah, I can finally have some time to breathe. When we received the equipment from the U.S. to Dyeon Korea, it was crazy. But now, I'm good. Additionally, I have all these good and competent workers in my team, such as the plant manager, assistant manager, and team leaders. These days, I just give them some instructions in the morning and I just monitor their work, that's it."

"Well, if you don't do much at work, I guess I will have to let you go, man. The company can save money by letting you go and not paying your salary."

"It's not just me, bro. Everyone at the management level is like that. The general affairs team and the accounting team don't work crazily like the old days. The sales department is not so busy either since we have a lot of recurring customer companies."

"Is that right?"

"The workers said they were having very peaceful days at work since there is no boss who is crazily nagging them all the time. President Jang-Hwan Song is the only one who visits the production field from time to time to point out things, but that's nothing."

"Hey, which car are you driving these days?"

"The same car you know. The Hyundai Santa Fe. It's ten years old with over 20,000 kilometers on it. I need to replace the tires soon, but it works very well."

"What did you do with the 10 million won that you received from the Egnopak's president? Why didn't you get a new car with it?"

"I used that money when I purchased my Purgio condo; I bought new furniture, refrigerator, and washer and stuff."

"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."