Hyundai Mobis Keeps Strong

Registers a higher-than-expected 21.3 percent jump to 2,098 bln won in sales during 1st quarter

Hyundai Mobis posted 2,098.8 billion won in sales in the first quarter of the year, a 21.3 percent surge over a year earlier and 205.6 billion won in operating profit, an 8.4 percent rise, the company said on May 4.
However, Korea's largest automotive parts maker chalked up 256.2 billion won in ordinary profit and 174.7 billion won in net profit, representing a 4.1 percent decline and an 11.6 cent drop, respectively.
A Hyundai Mobis official said, "Hyundai Mobis saw sales improving compared to the same quarter of last year thanks to a steady growth of after-sale parts arising from a rise in the number of automobiles that hit streets as well an increase in the supply of modules of Hyundai Motor and Kia Motors"new models and complete knockdown (CKD) exports."A rapid appreciation of the Korean won against the dollar during the first quarter of 2006 did not much impact on Hyundai Mobis'sales and operating profit.
The after-sale parts business sector maintained a steady market share without being influenced by Chinese-made copycats and dollar-denominated exports soared 18.2 percent in the first quarter. Hyundai Mobis'domestic business sector shared the benefits arising from Hyundai Motor and Kia Motors'lowering parts unit prices. As a result, the business sector witnessed the rate of operating profits reverting from an average of 13.3 percent during 2005 to up to 14.8 percent in the first quarter of 2006. The after-sale sector accounted for 32 percent of the total sales, but took up 58 percent in terms of contribution to making operating profits. Besides, Hyundai Mobis'incorporated company in Alabama, the United States, changed to black figures, albeit in a small margin.
DOUBLE-PROLONGED STRATEGY. Early this year, Hyundai Mobis unveiled a management strategy with a focus on external growth and profit-oriented management. It aims to post 8.1 trillion win in domestic sales, $3.5 billion in overseas sales and $2.07 billion in exports during 2006 : the figures representing a 7.3 percent rise, a 39.3 percent jump and a 21.8 percent surge, respectively, from last year when the automotive parts company achieved a record high of business performance.
Hyundai Mobis plans to invest 613 billion won during this year, a 30.2 percent surge from last year in a bid to expand production and logistic centers abroad and strengthen R&D activities.
A company official said, "This year's aggressive business target is part of efforts to step up on the gas to strengthen its overall business presence as module plants in North America and Slovakia begin production while logistics storage facilities will be established in such countries as Slovakia and Germany."The 2006 business plan calls raising the portion of exports to domestic sales from 23 percent last year to 26 percent this year.
Hyundai Mobis chalked up 7,547.7 billion won in sales and 831.3 billion won in 2005 - a record-high performance -, representing a 175 percent surge and a 17 percent rise over 2004.
Capitalizing on the remarkable achievements, Hyundai Mobis plans to accelerate profit-oriented management policies through the buildup of an efficient management system, while putting more energy into implementing global management policies designed to expand overseas production and logistic centers.
Hyundai Mobis adopts an aggressive approach in major business arenas. In its core sector of module, the company is focusing on the expansion of global production centers and added value businesses and strengthening of a foundation for securing its own technologies. In particular, the company will continue to develop such futuristic cash cow products as high-tech parts for next-generation automobiles.
In the parts business area, the company plans to strengthen overseas presence by expanding logistics centers in China and establishing logistics storage facilities in Slovakia and Germany. It will expand a bar-code system and reinforce global stock management to ensure customer satisfaction and boost profits.
A Hyundai Mobis official said, "In recent months, external and internal business circumstances are not favorable, but Hyundai Mobis posted better-than-expected sales and profits. The company will pursue profit-oriented management internally during this year while adopting an aggressive global management approach externally to lay a foundation for making a new leap. nw

Hyundai Mobis is strengthening its presence in China by expanding logistics centers.