Kia more than doubled its operating profit in the first quarter of this year, thanks to improved sales, according to Reuters.
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However this was below expectations because of the effect of the strong won. Kia sells more than 75% of its vehicles overseas.
“Recent increases in export prices due to a firmer won and the stronger price competitiveness of competitors, especially Japanese car makers, hurt our competitiveness abroad,” Kia said in a statement.
Reuters said that for the full year Kia is expected to post a 8.1% rise in net profit. The estimate is based on forecasts by 23 analysts compiled by Reuters Estimates.
Kia achieved an operating profit of 32.2bn won ($34.09m) in January-March, more than double last year’s 16bn. Reuters Estimates had expected an operating profit of around 49bn won.
The figure was also down on the 54.1bn won in the previous quarter.
“The won is a decisive factor,” said Song Sang-hoon, an auto analyst at Hyundai Securities told Reuters. “If the won does not fall below 950 per dollar, it will be difficult for Kia to show earning improvement even with good models.”
Q1 sales grew 11.4% to 4.39 trillion won from a year ago, as Kia sold more of its Lotze sedans and Carnival minivans, but were down from 4.58 trillion won in the previous quarter.
