Carmaker Kia reported profit that missed analysts' estimates after labour protests led to the company's second-worst strike in the past decade.
Third-quarter net income rose 28 per cent to 829.5 billion won (€584 million), compared with 647.9 billion won a year earlier, the Seoul-based company said in a statement today.
The stock fell the most in five months in Seoul trading as the company cut next year's production target after the nine-week dispute with its union cost Kia an estimated 1.03 trillion won in lost output.
By volume, it was the worst strike as the stoppages prevented the company from producing 62,890 vehicles.
"The biggest disappointment is Kia's production plans for next year," Lee Sang Hyun, an analyst at NH Investments, said by telephone.
The revision, coupled with the strengthening won, makes next year's prospects for export- dependent Kia look bleak, he said.
The automaker lowered next year's production target to 2.8 million units, versus an earlier goal of 3 million, Joo Woo Jeong, head of the financial management group, said in a conference call today.
Output will reach 3 million after Kia's new plant in China starts production in 2014, he said. Kia fell 5.6 per cent to close at 62,300 won, its biggest decline since May. The benchmark Kospi stock index dropped 1.7 per cent.
Chief financial officer Park Han Woo expressed his concerns about the strengthening won, the best performing major currency in the past month.
"The strengthening won may hurt the company's profitability moving forward.”
Bloomberg