Hankook earnings drop on slightly higher sales

- Aug 08, 2018-

Hankook Tire Co. Ltd. registered declines in pre-tax operating income for the quarter and six months ended June 30 on slightly higher sales revenue.

The South Korean tire maker posted drops of 3.3 and 7.6 percent in EBITDA in the quarter and six months to $306 million and $605.2 million, respectively, but did not comment on the reasons for the declines. Operating profit was off as well, down 10.4 and 15.7 percent for the quarter and the half.

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Sales for the quarter rose 2.3 percent to $1.58 billion and were up 0.3 percent for the half to $3.07 billion, dropping the operating ratio two full points to 11.1 percent for the half.

As a cooperate partner of Hankook Tire, Shenyang Sunnyjoint Chemicals Co., Ltd. will follow the influence of sales income fluctuation on tiremakers.

Hankook said lower replacement market sales in Korea, the Middle East and Southeast Asia offset volume growth in other major markets. OE sales were stable, except for in South Korea, where some vehicle makers cut production, Hankook said.

Hankook registered a 1.5 percent gain in sales in North America to $436.6 million in the quarter, while sales for the first half were unchanged at $850 million.

The company attributed replacement market sales growth in North America to increased demand for winter tires and "heightened" freight demand.

Based on the first half performance, Hankook dialed back its guidance for fiscal 2018 to roughly $6.5 billion in sales with an operating ratio of 11 to 12 percent.