Hankook Tire & Technology Co Ltd (161390) Q2 2026 earnings summary

Executive summary

• Consolidated H1 2026 revenue reached KRW 10,996.4 billion, with operating profit of KRW 1,066.1 billion, net income of KRW 689.7 billion, and an OP margin of 9.7%.

• Tire Business achieved record-high quarterly and H1 revenue and strong profitability, while Thermal Management Systems (Hanon Systems) saw stable growth and improved margins.

• Major investments included ongoing capacity expansions in Hungary and Tennessee, and the acquisition of Hanon Systems, strengthening the automotive thermal management business.

Financial highlights

• Tire Business revenue rose 11.8% YoY to KRW 2,807.3 billion in 2Q 2026; H1 2026 tire revenue was KRW 5,373.1 billion with an OP margin of 17.1%.

• Thermal Management Systems revenue up 0.6% YoY to KRW 2,875.2 billion in 2Q 2026; H1 2026 segment revenue was KRW 5,623.5 billion with a 3.6% margin.

• Consolidated D/E ratio improved YoY from 101.1% to 84.7% (2Q 2026); H1 2026 D/E ratio was 84.8%.

• EBITDA for 2Q 2026 was KRW 927.3 billion (16.3% margin).

• Interim dividend of KRW 900 per share for H1 2026, up 12.5% YoY, totaling KRW 109.8 billion.

Outlook and guidance

• Targeting sustained volume and qualitative growth in Tire Business for 2026, with revenue growth above global tire market CAGR.

• Focus on high-inch, EV, and SUV tires; 2026 target: ≥18-inch tires to be at least 51% of PCLT revenue, EV tires at least 33% of PCLT OE sales.

• Maintain strong cash flow and annual EBITDA over KRW 2 trillion, despite elevated CAPEX.

• Commitment to raising adjusted payout ratio to ~35% by FY2027 and regular interim dividends.

• Focus on sustainable growth, digital transformation, and strengthening global OEM partnerships.