Kia Motors turns to profit in Q4 on sales won
SEOUL, Jan 25 (Reuters) - Kia Motors Corp (000270.KS: Quote, Profile, Research), South
Korea’s No. 2 auto maker, on Friday said it turned to a quarterly
profit, helped by a weaker won and a reduction in costs.
Kia, an affiliate of the country’s top car maker Hyundai
Motor Co (005380.KS: Quote, Profile, Research), reported 37.9 billion won ($39.94 million)
in net profit during the quarter ended on Dec. 31, missing an 80
billion won profit forecast by 11 analysts in a Reuters poll.
That compared to a revised 214 million won net loss a year
earlier and 55.1 billion loss in the third quarter of 2007.
Kia’s fourth quarter operating profit surpassed analysts’
expectations, coming in at 97.7 billion won for the
October-December quarter, well above an average forecast of 54
billion won.
A softer won is expected to boost earnings at the maker of
the Sportage sports utility vehicle (SUV). Some 80 percent of
Kia’s total sales are made overseas.
The Mohave also called the Borrego, its recently launched
SUV, and the revamped Morning minicar are likely to lift sales in
the higher-margin local market.
However, its growth prospects in the United States and China,
the world’s two top auto markets, are not that rosy because of
weak demand and fierce competition.
Rising prices of raw materials and a lack of a hit model are
concerns as well.
Reflecting these worries, shares in Kia, valued at $3.4
billion, lost 18.9 percent during the October-December period,
underperforming the wider market’s 2.54 percent fall.
($1=948.9 Won)
(Reporting by Cheon Jong-woo and Rhee So-eui; Editing by Keiron
Henderson)
