Hankook earnings up 12% in 2020 despite pandemic

Neu-Isenburg, Germany – Hankook Tire has posted a 12.0% increase in operating profit for 2020, to €466 million, on global sales down 9.1% year-on-year to €4,794 million. 

The improved earnings largely reflected higher sales of 18-inch and above tire sizes – up 3% year-on-year to represent around 35% of total passenger-car tire sales, reported Hankook. 

“Europe, North America, and China have been regions that particularly contributed to rising sales during the second half of the year,” according to the tire maker’s 5 Feb statement. 

For the fourth quarter, Hankook’s operating profit came in 92.1% higher year-on-year at €171 million, on sales up 3.8% to €1,326 million.

The Korean group added that it “has proceeded to expand its partnerships with premium car makers and has already become a pioneer in the electronic vehicle tire market.”

Earnings were also bolstered by rising sales in replacement tires “that are especially profitable in regions such as Europe and North America,” and a stabilisation in raw material costs.

Hankook commented that its positive 2020 financial performance was “particularly noteworthy considering the global pandemic and its economic impact.” 

In particular, it noted, sales of replacement tires rose compared to the same period last year in regions such as Europe and North America during the fourth quarter. 

In China, demand for both OE and replacement tires increased as sales of larger tires up by 12 percentage points year-on-year to reach around 40% of total sales.

For 2021, Hankook is targeting a turnover of around €5.4 billion by expanding sales of high-inch tires in major regions, supplying OE tires for premium cars, and progress in the electric vehicle market.