Hyundai Motor profit falls for sixth quarter on weak sales

[SEOUL] Hyundai Motor Co reported quarterly profit declined for a sixth consecutive quarter after sales fell in China and the US, the automaker's two largest markets.

Net income fell 24 per cent to 1.7 trillion won (S$2.05 billion) in the quarter ended June, from 2.24 trillion won a year earlier, the Seoul-based company said Thursday. That compares with the 1.74 trillion won average of 24 analysts' estimates compiled by Bloomberg.

Quarterly sales in China and the US declined amid intensifying competition after a stronger won against the yen curbed Hyundai's competitiveness against rivals like Toyota Motor Corp.

The South Korean automaker is counting on new versions of its Tucson sport utility vehicle, which begins sales in the US this month, and the Elantra sedan to boost sales.

"With unfavourable economic situations, such as a stronger won, poised to continue, it seems unlikely that Hyundai's sales will drastically improve anytime soon," Lee Sang Hyun, an analyst at IBK Securities Co, said before the earnings announcement.

The company announced its first-ever interim dividend earlier Thursday, after its decision to buy a piece of land in central Seoul was criticized by some stockholders. Hyundai will pay 1,000 won per share, or a total of 268.7 billion won, as an interim dividend, it said in a filing.

Hyundai's shares rose 5.3 per cent to 138,000 won in Seoul trading as of 1.15pm.

BLOOMBERG