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(LEAD) Kia Motors Q4 net drops 1.2 pct

All News 10:42 January 27, 2016

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SEOUL, Jan. 27 (Yonhap) -- Kia Motors Corp., South Korea's No. 2 automaker, said Wednesday that its fourth-quarter net profits dropped 1.2 percent from a year earlier, affected in part by losses from equity ties with affiliates.

Its net profit reached 430.8 billion won (US$359.5 million) during the October-December period compared with a profit of 436.2 billion won a year earlier, the company said in a regulatory filing.

Operating income grew 2.8 percent on-year to 514.4 billion won over the cited period and sales also rose 9.3 percent to 12.8 trillion won, it said.

The company explained that the drop in the fourth-quarter earnings was caused partly by losses from its equities tied to affiliates. It, however, did not reveal detailed information.

For 2015, Kia Motors reported a net profit of 2.63 trillion won, down 12.1 percent from a year earlier. Its operating profit fell 8.5 percent to 2.34 trillion won.

The fall in full-year operating profit was attributed to its increased spending on marketing aimed at countering intensifying competition in global markets.

Its operating profit ratio fell to 4.8 percent from the previous year's 5.5 percent.

Kia Motors expected that changes in market situations this year will be "extreme," citing the slowing growth in major economies, low energy prices and intensifying competition among rival companies.

In a bid to tide over the challenges, the automaker said that it will focus on targeting global markets with enhanced brand recognition and competitive new vehicle models in major segments.

Kia Motors expects to sell 3.12 million cars this year, which would be a 2.3 percent growth from last year.

Shares of Kia Motors traded at 47,600 won on the Seoul bourse as of 10:29 a.m., up 1.06 percent from a day earlier.

kokobj@yna.co.kr
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