Hyundai Motor Q2 net profit rises 59%, beats estimates

HYUNDAI Motor posted on Thursday (Jul 21) a rise of 59 per cent in second-quarter profit as a weak won currency lifted the value of overseas earnings and demand stayed strong for the South Korean automaker's high-margin sport-utility vehicles (SUVs).

Net profit climbed to 2.8 trillion won (S$3 billion) for the April-June period from 1.8 trillion won a year earlier, beating an average analyst forecast of 2.2 trillion won from Refinitiv SmartEstimate.

"A robust sales mix of SUV and Genesis luxury models, reduced incentives from a lower level of inventory, and a favourable foreign exchange environment helped lift revenue in the second quarter, despite the slowdown in sales volume amid an adverse economic environment," Hyundai Motor said in a statement.

The strong results come amid an easing of a global chip shortage, which helped Hyundai resume overtime and weekend shifts at its domestic plants, offsetting lost vehicle production caused by a nationwide trucker strike in June.

"After nearly 2 years of chip shortages, automakers, including Hyundai, are getting enough chips to produce at nearly full capacity," said Lee Jae-il, an analyst at Eugene Investment & Securities.

Shares in Hyundai Motor, which together with affiliate Kia is among the world's top 5 automakers by sales, were trading up 2.1 per cent as of 4.40 am GMT, compared with 0.7 per cent rise in the broader market KOSPI. REUTERS