Hyundai Mobis (A012330) Q2 2024 earnings summary

Executive summary

• 2Q24 revenue declined 6.6% year-over-year to KRW 14.7tn, mainly due to lower OEM production, a sharp drop in BEV sales, and reduced battery cell prices.

• 2024 H1 revenue was ₩28.5 trillion, down 6.0% year-over-year, but operating profit rose 9.0% to ₩1.18 trillion.

• Operating profit fell 4.2% year-over-year to KRW 636bn in 2Q24, impacted by fixed cost burdens from EV demand slowdown, despite strong A/S business performance.

• Main business: 79.3% from modules/parts, 20.7% from A/S parts; global presence with 30 production, 24 logistics, and 5 R&D centers.

• Maintains strong credit ratings (AA+ domestic, A3 Moody’s, BBB+ S&P) and robust financial structure.

Financial highlights

• H1 2024 revenue: ₩28,524.5 billion (down 6.0% YoY); operating profit: ₩1,178.8 billion (up 9.0% YoY); net profit: ₩1,860.0 billion.

• Module/Core parts sales dropped 10.0% year-over-year to KRW 11.7tn in 2Q24; A/S business sales rose 9.9% to KRW 2.7tn.

• Gross margin improved as A/S parts sales grew 10.7% YoY, offsetting a 9.6% decline in modules/parts sales.

• Cash and equivalents at H1-end: ₩6,194.7 billion; total assets: ₩62,603.8 billion; total equity: ₩42,764.5 billion.

• Basic EPS for H1: ₩20,567.

Outlook and guidance

• Electrification sales growth expected to slow due to accounting rule changes, but operating margin rate is projected to gradually increase.

• Some electrification projects may be deferred to 2025 due to EV market challenges; focus remains on enhancing bidding for core parts in 2H.

• Expects continued uncertainty from global economic and industry conditions, but aims to strengthen core mobility technologies and expand new business opportunities.

• Maintains a sustainable management vision focused on responsible innovation and clean technology.

• Plans annual facility investments of ₩20,984 billion, with focus on production capacity and R&D.