(ATTN: ADDS details throughout)
SEOUL, Oct. 26 (Yonhap) — Kia Motors Corp., an affiliate of Hyundai Motor Co., said Friday it swung to a net profit in the third quarter from a year earlier due to a low base effect.
For the three months ending Sept. 30, Kia posted a profit of 297.74 billion won (US$262 million) from a net loss of 291.77 billion won a year ago, the company said in a statement.
“In the third quarter of 2017, a one-off cost of 864.1 billion won was reflected in the bottom line when a local court ordered the company to retroactively make an overdue payment to employees,” a company spokesman said.
The court ruling, made in August last year, said regular bonuses should be included in the “ordinary wage” used as the basis for calculating overtime, severance and other payments.
The won’s strength against the dollar and currencies in emerging markets also weighed on the quarterly net results, the company said.
Kia shifted to an operating profit of 117.28 billion won in the third quarter from an operating loss of 427.02 billion won the previous year. Sales fell 0.24 percent to 14.074 trillion won from 14.108 trillion won over the same period, it said.
In the January-September period, net profit rose 23 percent to 1.062 trillion won from 863.2 billion won a year earlier. Operating profit more than doubled to 775.5 billion won from 359.8 billion won during the same period. Sales climbed 0.4 percent to 40.697 trillion won from 40.530 trillion won.
In the first nine months, Kia sold 2.07 million vehicles, up 2.6 percent from 2.02 million units in the year-ago period. It aims to sell 2.88 million autos this year.
Shares in Kia jumped 3.89 percent to 28,000 won as of 11:05 a.m. outperforming the broader KOSPI’s 1.19 percent loss. The rebound comes after its shares shed 5.92 percent to end at 27,000 won Thursday in line with Hyundai Motor Co.’s 5.98 percent loss.
On Thursday, Hyundai Motor, which owns a 34 percent stake in Kia, posted a 67 percent on-year decline in third-quarter net profit at 305.95 billion won due to heavy recall costs in the United States and a strong won.
Kia Motors main office in southern Seoul (Yonhap)
(END)