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breaking news Kia reports 2Q 2021 business results

breaking news

  • Global second quarter sales totaled 754,117 units versus 516,050 units a year earlier
  • Second quarter revenue at KRW 18.34 trillion vs. KRW 11.37 trillion
  • 2nd quarter operating profit at KRW 1.49 trillion; net profit KRW 1.34 trillion
  • Operating profit margin stood at 8.1% in 2Q
  • Kia will continue to expand sales with new models including the recently unveiled all-new Sportage SUV

Kia Corporation today announced its second quarter 2021 business results, reporting quarterly revenue of KRW 18.34 trillion to KRW 11.37 trillion in the same period last year. The continued recovery in global automotive demand, along with strong sales of the company’s recreational vehicle models, such as the Sorento SUV and the Carnival minivan, led to strong results despite unfavorable exchange rates.

Between April and June, Kia sold 754,117 units in global markets, an increase of 46.1% over the same period last year. Sales outside Korea increased 70.9% to 605,808 units.

Markets such as Europe, India and South America posted a strong rebound in demand compared to the same three-month period last year, when markets were hit hard by related lockdowns to the pandemic. Sales also picked up in the United States, supported by the ongoing market recovery and strong demand for new Kia models, such as the Sorento SUV and the Carnival minivan. Sales in Korea fell 8.2 percent to 148,309 units.

Kia operations in the second quarter profits increased at KRW 1.49 trillion versus KRW 145.2 billion, with an operating profit margin of 8.1%. The company also recorded a net profit (including non-controlling interests) of KRW 1.34 trillion, compared to KRW 126.3 billion in the second quarter of last year.

The strong performance was supported by Kia’s improved product line as well as the continued success of the brand’s higher margin RV models including the Telluride, Seltos and Sorento SUVs and the Carnival minivan. Sales of Kia’s RV models accounted for 56.5 percent of total sales volume, an increase of 2.8 percentage points from the same period last year.

Kia predicts that auto demand will continue to improve alongside the ongoing economic recovery after the global pandemic. However, the potential for lingering impacts from COVID-19 and continued supply issues for semiconductor parts as well as fluctuations in raw material costs leave lingering concerns within the industry.

Especially when it comes to the global semiconductor parts supply issues, Kia predicts that the shortage will continue into the third quarter of 2021 and it will take some time for the situation to fully normalize.

As a result, the company takes preventative measures to minimize business risks. In terms of chip supply, Kia will flexibly adjust its production plans based on the state of supply and preemptively secure its component stock with enough orders for one year while researching chip parts. alternatives to minimize the impact on its production.

The company will also proactively expand local production of components, diversify its supply chain and strengthen cooperation with various semiconductor partners to prevent the component shortage from worsening.

Despite challenging market conditions, Kia will continue to focus on improving sales dynamics and profitability with new models, including the EV6 battery-electric vehicle and the recently unveiled all-new Sportage SUV.

(Unit Revenue / Operating Profit / Net Profit: KRW billion)

2021 2T

2020 2T

Y / y Change

Vehicle sales (Units)

754 117

516.050

46.1%

Korea

148,309

161,548

-8.2%

Sales outside Korea

605,808

354,502

70.9%

Returned

18 339.5

11,368.8

61.3%

Operating result

1,487.2

145.2

924.5%

Net profit

1342.9

126.3

963.2%

* Net income includes non-controlling interests

* Under K-IFRS

Notes:
A. The above results are provisional consolidated business results in accordance with “Korean International Financial Reporting Standards (K-IFRS)”
B. The above results are preliminary and unaudited. Figures are subject to change after an official audit.
C. The above sales volumes are based on wholesale sales.
D. For more information, please see the company website (http://www.kia.com/worldwide/main.do)

Presentation material is available for download from the IR Company website – IR Calendar (http://pr.kia.com/en/company/ir/ir-library/business-results.do)



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