Salem Radio Network News Tuesday, May 24, 2022

Business

Hyundai Motor’s Q4 profit almost halves, misses estimates

SEOUL (Reuters) -South Korea’s Hyundai Motor Co reported a nearly 50% drop in quarterly profit on Tuesday, falling significantly short of analysts’ estimate, hurt by rising raw material costs and a one-off expense associated with employees’ bonuses.

Hyundai Motor, which together with affiliate Kia Corp is among the world’s top 10 automakers by sales, reported a net profit of 547 billion won ($456.32 million) for October-December, versus 1.1 trillion won a year earlier.

That compared with an average analyst forecast of 1.5 trillion won compiled by Refinitiv SmartEstimate.

Analysts warn that soaring prices of raw materials, component shortages and logistical bottlenecks caused by the COVID-19 pandemic are likely to further drive up costs in the current quarter.

“It’s hard to find a commodity for which prices are not rising and the situation is not expected to change in the foreseeable future,” Lee Jae-il, an analyst at Eugene Investment & Securities, said before the results were announced.

Shares in Hyundai Motor fell 2.6% as of 0525 GMT, versus the benchmark KOSPI’s 2.7% fall.

($1 = 1,198.7100 won)

(Reporting by Heekyong Yang and Joyce Lee; Editing by Himani Sarkar)

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