SEOUL, South Korea (Jan. 20, 2009)—Despite record sales last year, Hankook Tire Co. Ltd. saw its operating profits halved and its recurring profits fall nearly to break-even.
Operating earnings fell to $103.6 million and recurring profits dropped 98 percent to $3.1 million as sales grew 26 percent to $3.69 billion.
The company didn't offer an explanation for the drop in profitability, although raw material prices rose substantially during the period under consideration.
The company reported sales growth in ultra-high-performance tires of 35 percent, with particularly high demand for UHP tires in Europe (up 48 percent), Latin America and Asia/Middle East (up 27 percent) and the U.S. (up 21 percent).
“Despite the current economic climate,” Hankook CEO Seung Hwa Suh said, “I believe that Hankook Tire will be able to move forward by continuing to take our utmost efforts in tailoring to the needs of each and every market worldwide through ongoing research and development for innovative products.”
Hankook is targeting sales growth of 25.8 percent in 2009 and a rebound in earnings to 2007 levels.