Hyundai Q1 net profit tumbles 44%; Confirms weak profit in Q2

The South Korean auto giant announced the first-quarter 2020 net profit slumped 44% to its lowest level for the quarter in a decade due to the pandemic. The Q1 Net profit reported 463 billion won ($376 million), far below an average Refinitiv estimate of 607 billion won drawn from 15 analysts. The carmaker said it sold a total of 903,371 vehicles in the first quarter, decreasing 11.6% compared to the same period last year.

The company last year increased profits to 7.22 billion crowns. Compared to the previous year, this represents an increase of 531 million. The gross profit increased by 9% year-over-year, reaching $3.47 billion (4.26 trillion won).

“The company expects to face weakening profitability in the second quarter as the impact of COVID-19 continues to hurt auto demand around the world amid a sluggish global economy. Increased volatility in international oil prices also might slow demand, further blurring business outlook,” Hyundai said in a statement.

“Global vehicle demand fell over 40 percent in March due to the growing coronavirus impact, far greater than an average of 24 per cent on-year decline in demand for the first quarter following supply disruptions and virus fears,” Hyundai Senior Vice President Koo Za-Yong said in a conference call following the release of the earnings results.