Friday, October 28, 2005

Kia Motors says third-quarter profit fell sharply on costs, strike

Associated Press

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SEOUL, South Korea -- Kia Motors Corp. reported Friday that third-quarter net profit fell 47.9 percent from a year earlier along with an operating loss on higher raw material costs, production lost to a strike and a stronger Korean currency.

South Korea's second-largest automaker said it earned 74.9 billion won ($71.7 million) in the three months ending Sept. 30, down from 143.9 billion won ($137.8 million) a year earlier.

Kia, the maker of the mid-size Amanti, the Spectra sedan and Sportage sport utility vehicle, is affiliated with Hyundai Motor Co., South Korea's No. 1 vehicle manufacturer.

Hyundai on Thursday said its third-quarter net profit rose 27 percent from a year earlier as overseas sales helped offset production losses from a 12-day strike by workers for higher wages and bonuses and fewer working hours. Kia's union also joined the walkout.

Kia recorded an operating loss, or sales minus costs and expenses, of 21.1 billion won ($20.2 million). The company had an operating profit of 124.1 billion ($118.9 million) in the same period the year before.

Sales during the quarter fell 4.5 percent to 3.23 trillion won ($3.09 billion) from 3.39 trillion won ($3.25 billion) a year earlier.

Kia's shares fell 2.8 percent to 17,500 won ($17) late morning in Seoul.