Sales fall 3.4% to 45.11 trillion won

Annual sales target cut from 4.16 million to 4 million units

Operating profit margin guidance lowered

Investment plan trimmed to 16 trillion won from 17.8 trillion won

Hyundai Motor's headquarters in Yangjae, Seoul [Hyundai Motor]
Hyundai Motor's headquarters in Yangjae, Seoul [Hyundai Motor]

Hyundai Motor posted third-quarter operating profit of 2.68 trillion won ($2 billion), up 5.5 percent from a year earlier, even as sales declined. The automaker also revised down its annual sales target and operating profit margin guidance, lowering its overall business targets for the year. Its investment plan was trimmed by 1.8 trillion won.

Hyundai Motor disclosed through the Financial Supervisory Service's DART system Thursday that it recorded consolidated third-quarter sales of 45.11 trillion won and operating profit of 2.68 trillion won.

Sales fell 3.4 percent from the same period last year, while operating profit rose 5.5 percent. The improvement in profitability despite lower sales pushed the third-quarter operating profit margin to about 5.9 percent, up 0.5 percentage points from about 5.4 percent in the third quarter of last year.

Compared with the previous quarter, however, both sales and operating profit declined. Sales dropped 8.3 percent and operating profit fell 6.1 percent from the second quarter of this year.

Net profit for the period came in at 1.93 trillion won, down 24.2 percent from a year earlier. Pre-tax profit from continuing operations also fell 12.6 percent to 2.91 trillion won.

Profitability erosion was more pronounced in the cumulative figures for the year. Consolidated sales for the first three quarters totaled 140.26 trillion won, up 0.6 percent from the same period last year, but operating profit over the same period fell 17.7 percent to 8.04 trillion won. Cumulative net profit for the period also declined 19.3 percent to 7.4 trillion won.

Along with the preliminary third-quarter earnings disclosure Thursday, Hyundai Motor revised its annual business targets for the year.

The most notable change was to the sales target. Hyundai Motor cut its global sales target for the year to 4 million units from 4.16 million units set in January, a reduction of 160,000 units, or about 3.8 percent.

The profitability target was also lowered. Hyundai Motor had originally guided for a consolidated operating profit margin of 6.3 to 7.3 percent this year, but revised that range down to 5.5 to 6.5 percent, trimming both the upper and lower ends of the target band by 0.8 percentage points each.

The investment plan was scaled back as well. Hyundai Motor reduced its investment budget for the year by 1.8 trillion won, to 16 trillion won from 17.8 trillion won, a cut of about 10.1 percent. The company set a consolidated sales growth rate target of 1.0 to 2.0 percent for the year.

Hyundai Motor described the revision as "an update to the 2026 guidance announced at the start of the year, reflecting changes in the business environment."


kwater@heraldcorp.com