A 7,000-CEU car carrier operated by Hyundai Glovis. [Hyundai Glovis]
A 7,000-CEU car carrier operated by Hyundai Glovis. [Hyundai Glovis]

Hyundai Glovis set an all-time quarterly sales record in the second quarter. However, geopolitical risks stemming from the Middle East and rising oil prices weighed on its shipping segment, pushing operating profit below year-earlier levels.

Hyundai Glovis disclosed Thursday that it recorded consolidated sales of 8.71 trillion won ($5.88 billion) and operating profit of 495 billion won in the second quarter.

Sales rose 15.8 percent from the same period last year, marking a quarterly record. Operating profit declined 8.1 percent, bringing the operating margin to 5.7 percent.

By segment, logistics posted second-quarter sales of 2.86 trillion won and operating profit of 191.8 billion won. Sales climbed 10.3 percent year on year as the company expanded sales to non-affiliate customers and North American inland freight volumes increased. Operating profit, however, fell 5.9 percent, reflecting lower contract freight rates tied to shifts in container market conditions.

The shipping segment recorded sales of 1.64 trillion won and operating profit of 130.9 billion won. Sales grew 20.9 percent from a year earlier, but operating profit dropped 34.6 percent. Higher volumes from non-affiliate customers — including Chinese automakers — lifted sales, while rising oil prices driven by geopolitical risks in the Middle East squeezed profitability.

Hyundai Glovis said the decline in shipping segment profit reflected the timing of cost recognition rather than any weakening of its competitive position. Finished-vehicle maritime transport volumes remain solid, and the company expects profitability to recover gradually in the second half as freight rate adjustments take effect.

The retail segment posted second-quarter sales of 4.21 trillion won and operating profit of 172.3 billion won, up 17.9 percent and 27.8 percent, respectively, from a year earlier. The results were driven by a full ramp-up of completely knocked-down parts exports to assembly factories in emerging markets and growth in the trading business on higher non-ferrous metal volumes.

Including second-quarter results, Hyundai Glovis recorded cumulative first-half sales of 16.52 trillion won and operating profit of 1.02 trillion won. The company's full-year guidance calls for sales of at least 31 trillion won and operating profit of at least 2.1 trillion won.

In the finished-vehicle maritime transport market, capacity procurement, route risks and oil price volatility have all intensified this year. Hyundai Glovis maintained its sales growth trajectory, but near-term cost pressures weighed on profit margins.

In the second half, the company plans to focus on expanding non-affiliate sales and improving cost efficiency. It will continue diversifying its customer base across logistics, shipping and retail, while pursuing profitability recovery in the shipping segment — where cost volatility is highest — through freight rate adjustments and fleet operation optimization.

"Despite persistent volatility from external variables, we achieved a record quarterly sales figure by broadening our customer base and strengthening execution across our core businesses," a Hyundai Glovis official said. "The temporary softening in profitability caused by short-term oil price increases is recoverable in the second half, and we will continue to reinforce our competitive position on the foundation of our underlying earnings strength."


kwater@heraldcorp.com