SEOUL, South Korea (Aug. 1) — Hankook Tire Co. Ltd. reported double-digit increases in second-quarter and first-half sales while operating earnings lagged somewhat on higher sales, general and administrative expenses.
For the second quarter, Hankook´s sales rose 11.4 percent to $938.9 million as operating profits climbed 9.9 percent to $87.2 million.
Hankook´s sales grew in nearly all areas, including 23 percent in China, 13 percent in North America and 11 percent in Europe, where the company in June brought on stream a plant in Hungary.
Operating expenses were up 23.4 percent during the period, reflecting continued investment in the Hungarian plant, Hankook said. In addition, the cost of goods sold rose 9.8 percent, reflecting higher raw materials and labor costs.
For the first half, sales rose 13 percent to $1.85 billion, while earnings of $170 million were 0.6 percent ahead of last year.
"Our increased profitability is benefiting from a strategic focus on driving retail sales with more intensive marketing activities," said Hyun Bum Cho, chief strategy and financial officer, in a prepared statement.
He added that Hankook remains on track to meet its targets this year. "Our expanding global presence, especially in China and Europe, provides us with a strong base for expanding both sales and the reputation of the brand.