Hankook Tire & Technology Co. said Thursday its first-quarter net profit sank 34 percent from a year earlier as the coronavirus outbreak affected vehicle sales in major markets.
Net profit for the January-March quarter fell to 81.28 billion won (US$66 million) from 123.23 billion won in the year-ago period, the company said in a statement.
"The COVID-19 virus had a broad impact on global tire demand for vehicles and tire production at the company's overseas plants," the statement said.
Operating profit declined 25 percent to 106.86 billion won in the first quarter from 140.62 billion won a year ago. Sales were down 13 percent to 1.44 trillion won from 1.64 trillion won.
The quarterly earnings results were affected as Hankook Tire's captive buyers, Hyundai Motor Co. and Kia Motors Corp., suspended most of their overseas plants from late March to minimize the impact of COVID-19 virus and manage inventories.
Hyundai and Kia restarted production at their plants in Alabama and Georgia, respectively, on Monday (U.S. time). Hyundai's India plant will also resume operations this week, the companies said.Hankook Tire, the world's sixth-largest tiremaker by sales, earns over 80 percent of its total revenue from abroad.
It has eight plants -- two in South Korea, one in Hungary, one in the United States, three in China and one in Indonesia -- whose combined capacity reaches 102 million tires.
