Start of production from Hungary plant will contribute to increase of global sales
SEOUL, SOUTH KOREA (19th, January 2007) - Hankook Tire (www.hankooktire.com, CEO Choong Hwan Cho) announced their global sales target for 2007 up to 3.6 billion USD. They also target operating profit of 340 million USD and the recurring profit of 282 million USD.
Global sales target is based on production from Korean plants (Daejon, Geumsan), China (Jiaxing, Jiangsu) plants and partially on the new Hungary (Dunaujvaros) plant which will begin production mid-year. Korea operation itself expects a 13.8% increase from total sales of 2.5 billion USD compared to last year. Hankook Tire also targets a 65.1% increase in an operating profit of 301 million USD and a 40.8% increase from recurring profit.
In 2006, Korean operations sales grew approximately 10.36% percent from 2005 to 2.2 billion USD, while operating profit decreased 18.9 % to 183 million USD. Preliminary figures put the recurring profit at 237 million USD, down 14.25 %, and net profit at 175 million USD down 16.3 %.
(Unit: 1,000 USD)
* Exchange Rate: 1USD = year 2005: 1023.41 KRW / year 2006: 954.10 KRW / year 2007: 920 KRW
2007 Global Sales Target (Tire Sales Only) **
**Global Sales Target do not include sales figures of Hankook Tire’s affiliated companies.
Hankook Tire Co., Ltd (Korean Operations) ***
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***Total sales of Hankook Tire Co., Ltd is based on production from Daejeon and Geumsan plant
“High export prices and increased supply of OE (Original Equipment) tires to overseas automakers bolstered sales, despite an unfavorable operating environment,” noted Mr. Hyun Shick Cho, Executive Vice President and Chief Marketing Officer of Hankook Tire. He also added that “especially, when tire prices were raised once or twice, there was less resistance to the price hikes as a result of enhanced brand awareness.”
Operating profit in 2006 declined as raw material costs surged. In 2006, the average purchase price of natural rubber was USD 1,930 per ton, up 52 % from a year earlier. The price of carbon black and synthetic rubber went up 27 % and 6 %, respectively.
Executive Vice President Cho Hyun Shick said, “Uncertainty looms over the supply and price of raw materials such as natural rubber in the year ahead. However, we will overcome the challenging business environment by penetrating overseas markets with active marketing, expanding sales of OE tires to premium automakers, and innovating management.”
Meanwhile, Hankook Tire plans to start operating the Hungary plant and launch production in midway through 2007. The facility is currently under construction and it is set to be completed by 2008.
About Hankook Tire Co., Ltd.
Hankook Tire (CEO: Cho Choong Hwan) ) is one of the world’s largest and fastest growing tire manufacturers of radial tires for passenger cars, light trucks (SUVs, RVs, and etc.), trucks, and buses. Hankook Tire also develops cutting-edge technologies to upgrade customer satisfaction through high-quality products. Through sales in 170 countries around the world, Hankook Tire was ranked 8th in global sales revenue in 2005. The company has more than 12,000 employees in five Regional headquarters, nine sales offices, eleven subsidiaries and five R&D centers around the world and makes 70 percent of revenue through overseas markets.
For more information, please visit Hankook Tire’s web site at www.hankooktire.com.