[Economy PICK] Rumor of Crisis Lotte Declares 'War on the Spread of Jirashi'

[Anchor]
Let's start the economic pick that easily solves major economic issues.

[Anchor]
Today, we are with reporter Ryu Hwan-hong. Welcome.

[Anchor]
Let's look at the first question right away. Rumor of crisis Lotte declares 'war on the dissemination of Jirashi'. Jirashi is a private information paper. Rumors spread in the private information magazine that Lotte was facing a financial crisis and affected the stock market. Is Lotte responding?

[Reporter]
Lotte Corporation asked the Gangnam Police Station in Seoul to punish the writers and distributors of Jira City this morning. Last month, a video was uploaded on YouTube titled "Lotte Group Air Decomposition."

The next day, related information began to be widely distributed in the market through Jirashi. YouTube was at the level of a combination of media reports, but the content of this jirashi contained a lot of conclusive and malicious expressions. A moratorium is expected at Lotte Group in early December. I'm talking about deferred payment.

[Anchor]
It's early December.

[Reporter]
That's right. In addition, more than 50% of employees are expected to be cut. In addition, Lotte Engineering & Construction's unsold housing has increased, raising concerns about a fatal blow to its affiliates' payment guarantees. In addition, it is difficult to settle debts even if the entire group's real estate is sold. These contents were definitively included.

However, Lotte Group said, "The liquidity crisis is groundless. I concluded it like this. Then, I officially requested to find and punish those who made and distributed them today.

[Anchor]
Lotte said it was groundless, but why did you mention that Lotte is in crisis?

[Reporter]
The main epicenter can be seen as Lotte Gemical. It seems to be true that major affiliates such as Lotte Chemical, Hotel Lotte, and Korea Seven, which we know as 7-Eleven, are now experiencing a liquidity crisis. We looked at the cumulative interest compensation ratio up to the third quarter of this year.

Those five companies have an interest compensation ratio of less than 1, so to put it simply, they are unable to pay interest with operating profit. In particular, among those three places, Lotte Chemical, Korea Seven, and Hotel Lotte are in the red. Usually, if the interest compensation ratio is less than 1, it is evaluated as a potential insolvent company.

By the third quarter of this year, 52 out of 271 major companies, excluding financial companies, have an interest compensation ratio of less than 1 percent. Five of them are Lotte affiliates. Lotte Chemical is experiencing a liquidity crisis due to China's oversupply.

Lotte is worth about 6 trillion won in Lotte World Tower to make up for this. I offered this as collateral. In addition, Lotte Shopping is selling poor stores, including Lotte Department Store in Centum City in Busan. In addition, we have changed 26 CEOs in our recent personnel appointments.

[Anchor]
I see. We've talked about Lotte's crisis.