Roundup: Hyundai Motor posts largest Q1 revenue on premium brand sales

Hyundai Motor, South Korea's largest automaker, posted the largest first-quarter revenue thanks to solid demand for newly launched premium brand Genesis and an increase in sales of sports utility vehicles (SUVs), the company said Tuesday.

Revenue increased 6.7 percent over a year earlier to reach 22.35 trillion won (19.42 billion U.S. dollars) in the January-March period, larger than any first-quarter figures in the past.

Hyundai's auto sales in the domestic market gained 3.7 percent in the first quarter from a year earlier due to demand for new models and consumption tax cuts, but overseas sales dipped 7.9 percent on soft sales in emerging markets, especially in China, Russia and Brazil.

Revenue from Chinese and Russian factories declined 9.2 percent and 6.2 percent each, with sales in Brazil tumbling 33.6 percent.

Overall, South Korea's No.1 carmaker sold a total of 1,107,377 vehicles during the quarter globally, down 6.4 percent from a year ago.

Despite the slowdown in global car sales, the company's overall revenue recorded a 6.7 percent expansion thanks to demand for high-priced Genesis models and growing sales of SUVs that have gained great popularity in China, the world's largest auto market.

Operating profit and net income, however, posted a double-digit fall due to the worsening economic conditions in emerging economies, especially in Russia and Brazil.

Hyundai's operating profit declined 15.5 percent from a year earlier to 1.34 trillion won in the first quarter, and net income slumped 10.8 percent to 1.77 trillion won.

Economic downturn in some emerging economies, caused by low crude oil prices, took a toll on Hyundai's car exports, while the continued depreciation of emerging currencies, especially of Russia and Brazil, reduced repatriated earnings, the company said in a statement.

Lower factory utilization rate increased fixed costs, while higher marketing costs for new models and rising investment into R&D raised operating costs to 2.9 trillion won in the first quarter, up 5.6 percent from a year ago.

Hyundai predicted a bleak picture in the global car industry, citing the deepening economic slump in developing countries and delayed economic recovery in advanced nations.

To overcome the difficulties, Hyundai said it will make efforts to maximize demand for new models and expand SUVs supply while seeking to reduce costs.

A Hyundai official expected the new Avante sedan, which was successfully released in China and the United States in the first quarter, to boost car sales in the second quarter, saying that SUV sales are forecast to continue to grow. Enditem