South Korea's top automaker Hyundai Motor saw its operating profit slump to a five-year low in the third quarter while its third-quarter sales gained.
The company attributed the drop in the operating profit to pullbacks in emerging market currencies, including the Russian ruble and Brazilian real, and to a weak euro. And rising marketing expenses jacked up operating costs, thus denting its Q3 operating profit.
The automaker logged an operating profit of 1.5 trillion won and 23.4 trillion won in sales in the July to September period. While its Q3 sales rose 2.7 percent from the previous quarter, its Q3 operating profit, ordinary profit and net profit dipped 14.1 percent, 28 percent and 32.6 percent q-o-q, respectively. Hyundai Motor sold a disappointing 1,121,796 units, down 0.6 percent from a year earlier.
Noteworthy is that its Q3 operating profit fell to a 5-year low, the lowest since the fourth quarter of 2010 when the company posted an operating profit of 1.23 trillion won.
“Drops in emerging market currencies, from Russia to Brazil, and in the euro cancelled out a decline in the value of the Korean won against the greenback. In major markets including North America, we scaled up our marketing and PR campaigns as our competitors’ sales promotions kicked into high gear on the back of a weak yen and a weak euro,” Hyundai Motor explained.
