Kia Q1 net profit up 32.5 pct on sales boost of SUVs, minivans, hybrids
SEOUL, April 26 (Yonhap) -- Kia Corp., South Korea's second-largest automaker, said Friday its first-quarter net profit rose 32.5 percent on-year, backed by increased sales of SUVs, minivans and hybrid models.
Net profit for the January-March period came to 2.8 trillion won (US$2 million) on a consolidated basis, compared with a profit of 2.1 trillion won a year ago, the company said in a regulatory filing.
Operating profit reached 3.42 trillion won, up 19.2 percent from a year ago. Sales jumped 10.6 percent to 26.21 trillion won.
The earnings beat market expectations. The average estimate of net profit by analysts stood at 2.24 trillion won, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.
The company managed to improve its on-year performance despite a slight decrease in the number of vehicles sold. Kia sold 137,871 units in South Korea while shipping 622,644 overseas.
The combined 765,515 units sold during the period represent a 1 percent drop from last year.
Kia attributed its improved performance to an increase in its average selling price from its expanded portfolio of eco-friendly vehicles, such as hybrids, as well as SUVs and minivans. It also cited favorable exchange rates during the period for its improved bottom line.
The company said its overseas sales grew thanks to strong demand in major regions, such as North America and Europe. However, sales in some emerging markets, such as India and the Middle East, decreased compared to the previous year due to factors such as aging models and geopolitical factors.
The portion of eco-friendly vehicle sales during the quarter reached 21.6 percent, up 3.5 percentage points from last year. Kia said it sold 93,000 hybrid units and 44,000 electric vehicles, up 30.7 percent and 7.9 percent from last year, respectively.
Kia said it expects to face challenging business environments due to several factors, such as persistent geopolitical risks, sluggish economic growth and dampened consumer confidence due to high interest rates and inflation
Domestically, Kia said it aims to expand sales through hybrid versions of popular models, such as the Sorento, Carnival and Sportage, and maintain sales momentum by launching the EV3 and other new models in the second half of the year.
Kia added it plans to utilize new models and high-profit models, such as the Carnival hybrid and K4, to sustain profitability in the U.S. market. In Europe, Kia plans to enhance its EV lineup to strengthen its brand image as a leader in the competitive EV sector.
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