Hankook Tire & Technology Co Ltd (161390) Q1 2026 earnings summary

Executive summary

• Consolidated revenue reached KRW 5,313.9 billion in Q1 2026, with operating profit at KRW 507.0 billion and net income of KRW 372 billion; operating margin was 9.5%.

• Tire business revenue was KRW 2,565.7 billion with operating profit of KRW 437.5 billion, while thermal management (air conditioning) revenue was KRW 2,748.2 billion with operating profit of KRW 97.2 billion.

• Major business activities include tire manufacturing, automotive thermal management, and related machinery, with significant global operations and investments.

Financial highlights

• Gross margin for Q1 2026 was KRW 1.20 trillion, with a gross margin rate of 22.6%.

• Operating margin stood at 9.5%, and net margin at 7.0% for the quarter.

• EBITDA for the group was KRW 8,637 billion (16.3% margin).

• Cash and cash equivalents at quarter-end were KRW 2.74 trillion, up from KRW 2.60 trillion at the end of 2025.

• Q1 2026 R&D expenses were KRW 73.3 billion for the tire segment (2.9% of sales) and KRW 94.1 billion for the thermal management segment (3.4% of sales).

Outlook and guidance

• The company is expanding production capacity in the US and Hungary, with ongoing investments in automation and new product development.

• Tire segment targets qualitative growth focused on profitability, aiming for revenue growth above global tire market CAGR.

• ≥18-inch product sales within PCLT targeted to exceed 51% in 2026; EV tire share in PCLT OE to reach 33%.

• Strong cash flow expected, with EBITDA exceeding KRW 2 trillion since 2024.

• Dividend policy aims for a payout ratio of 35% of adjusted net income by 2027, with interim dividends introduced.