SEOUL, Hankook Tire and Technology Co., positioned as the seventh-largest tire manufacturer globally in terms of sales, disclosed a 30 percent increase in net profit for the third quarter of this year compared to the same period in the previous year, attributing the growth to a boost in sales of premium products.
According to Yonhap News Agency, the financial results released by the company, the net profit for the quarter concluding in September escalated to 300.31 billion won (US$220 million), a significant rise from the 230.56 billion won recorded during the corresponding quarter in the previous year. The company attributed this financial uptick to "an increased supply of value-added tire products for high-performance cars and all-electric vehicles manufactured by leading international automobile companies," as mentioned in the official statement.
Further contributing to the tire manufacturer’s improved profitability were prolonged original equipment (OE) tire supply agreements with international automobile manufacturers, coupled with the stabilization of raw material prices and delivery charges. OE tires, supplied to automakers' assembly lines at wholesale prices, are distinguished from replacement equipment tires sold in after-sales markets, with the latter being generally more profitable for automakers.
The company’s operating profit saw a significant leap, more than doubling to 396.38 billion won in the third quarter, up from 192.43 billion won in the same period last year. Sales exhibited a 9.4 percent increase, reaching 6.707 trillion won, compared to 6.13 trillion won during the equivalent period of the previous year.
Despite these positive financial results, Hankook Tire reported that a production line at its Daejeon plant, located 164 kilometers south of Seoul, remains non-operational following a substantial fire earlier this year. On March 12, one of the two production lines at the Daejeon facility was engulfed in flames, while the other line remained unaffected and continues to operate.
The company highlighted that over 80 percent of its total revenue is generated from international markets. Hankook Tire operates eight manufacturing plants located in various parts of the world, including two in South Korea, one in Hungary, one in the United States, three in China, and one in Indonesia, boasting a combined production capacity of 102 million tires annually.