Hyundai suffers from strong currency

14-08-2006

Carmaker Hyundai has posted worse than expected quarterly profits of 387 billion won (£121 million) after exports were hit by strength of the South Korean won over the dollar.

The automotive firm's profits fell 37 per cent compared to the corresponding period last year as faltering overseas sales were further knocked by costs incurred converting revenue into the South Korean currency.

Today's results reflect a turbulent three months for Hyundai, which has faced a month-long employee strike over poor pay levels and seen its chairman Chung-Mong Koo arrested on suspicion of using company funds to gain political favour.

The company's financial picture was also not helped due to falling share prices in Kia Motors, which Hyundai acquired in 1998. However, Hyundai's own share price rose this morning as fears over the won's continued strength eased.

During the last quarter overall car sales fell 1.4 per cent, despite strong individual performances from its Santa Fe and Grandeur models.

Group revenue rose by 2.1 per cent to more than seven trillion won (£3.8 billion), Hyundai reported.


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