SEOUL — South Korea's Hyundai Motor Co. reported on Thursday that its second-quarter net profit rose 25 percent from a year earlier, driven by an improved product mix and a weak won.
According to Yonhap News Agency, net profit for the three months ending June 30 climbed to 4.17 trillion won (US$3.01 billion) from 3.35 trillion won in the same period last year. "A combination of increased sales of SUVs and other high-end vehicles and the won's weakness (against the U.S. dollar) resulted in the quarterly record net result. Expanded sales of gasoline hybrid and other environment-friendly models also helped," the statement said.
The dollar rose to an average of 1,370.91 won in the June quarter from 1,314.68 won a year earlier, according to data from the Bank of Korea. A weak won boosts an exporter's dollar-denominated income when converted into the local currency.
Looking ahead, Hyundai noted that high lending rates and rising incentives due to tougher competition among carmakers will continue to pose "risk factors" in the second half. To boost sales, Hyundai plans to further strengthen its gasoline hybrid model lineup to counter the current slowdown in the electric vehicle market and adjust production schedules based on market demands, while focusing on SUVs and high-end Genesis models, the statement added.
Operating profit rose 0.7 percent to 4.28 trillion won in the June quarter from 4.25 trillion won a year ago. Sales increased by 6.6 percent to 45.02 trillion won from 42.23 trillion won during the same period. Robust sales of SUV models, including the GV80 SUV under Hyundai's independent Genesis brand, in the U.S. market helped offset lackluster sales in China, the statement said.
From January to June, net income rose 12 percent to 7.55 trillion won from 6.77 trillion won in the same period last year. Operating profit fell 0.7 percent to 7.84 trillion won in the first six months from 7.89 trillion won a year ago, while sales gained 7.1 percent to 85.68 trillion won from 80 trillion won.
In the first six months, Hyundai sold 2.06 million vehicles, down 0.8 percent from 2.08 million vehicles a year earlier. The company has set a sales target of 4.24 million vehicles for this year, including overseas sales of 3.54 million units.