Kia (000270) Q3 2024 earnings summary

Executive summary

• Sales revenue rose 3.8% year-over-year to W26.5 trillion in 3Q 2024, with operating profit up 0.6% to W2.88 trillion and net profit up 2.1% to W2.27 trillion, despite a 1.9% decline in consolidated sales units.

• For the nine months ended September 30, 2024, sales reached W80.3 trillion, operating profit W9.95 trillion, and net profit W8.03 trillion, all up year-over-year.

• Green car sales (HEV, PHEV, BEV) increased 3.6% year-over-year, with strong HEV growth and new model launches offsetting supply constraints and EV demand slowdown.

• Global retail sales fell 2.2% year-over-year to 735,000 units in 3Q, with declines in Korea, U.S., and Western Europe, but growth in India and Asia-Pacific.

• Total assets increased to W87.54 trillion and equity attributable to owners rose to W52.26 trillion as of September 30, 2024.

Financial highlights

• Gross margin improved to 23.2% in 3Q and 23.7% for the nine months, up from 22.9% year-over-year.

• Cost of sales ratio decreased to 76.8% of revenue, while SG&A expenses rose to 12.3%.

• Basic EPS for the nine months was W20,457, compared to W18,069 last year.

• Net cash provided by operating activities was W10 trillion, with net cash used in investing activities rising to W6.75 trillion.

• Average USD/KRW exchange rate increased 3.7% year-over-year, supporting revenue.

Outlook and guidance

• Revised 2024 annual guidance: sales revenue W105–110 trillion, operating profit margin 12% or higher, both raised from initial guidance.

• 4Q outlook includes supply increases for key models, new HEV launches, and EV3 mass-market launch to offset EV demand slowdown.

• Continued investments in global expansion, including factory expansions in Slovakia and India, and construction of the Global Business Center.

• No single external customer represents 10% or more of sales, indicating a diversified revenue base.