Hyundai Mobis Co., the auto parts unit under South Korean auto conglomerate Hyundai Motor Group, reported a 17.4 percent gain in operating profit for the quarter ended December but shed 22.4 percent in income for full year due to subdued global demand.

Taking cue from the recovery from the latter half, it vowed to boost capital spending by 17 percent and new orders by 64 percent this year.

In its regulatory filing on Thursday, Hyundai Mobis said its consolidated operating profit reached 702.3 billion won ($629.3 million) in the October-December period, up 17.4 percent from a quarter ago and 10.7 percent from a year earlier.

Net profit soared 48.1 percent from three months ago but fell 0.5 percent against a year ago to 579.4 billion won, while sales added 6.9 percent on quarter and 2.6 percent on year to total 10.68 trillion won in the fourth quarter.

Profit beat the market estimates of 667.3 billion won, but sales underperformed.

Hyundai Mobis shares rose 0.76 percent to 331,100 won on Thursday.

For the full 2020, Hyundai Mobis raked in 1.83 trillion won in operating profit, down 22.4 percent from the previous year. Net profit shriveled 32.3 percent to 1.55 trillion won, while sales lost 3.7 percent to 36.63 trillion won.

The strong fourth-quarter results owed much to improved profitability from all-out cost-reducing efforts and expanded revenue from the electrified auto parts business, the company said.

The mainstay module and core parts business delivered 8.8 trillion won in revenue in the fourth quarter, up 4 percent on year. Electrified auto component sales jumped 46.5 percent to 1.26 trillion won, driving the revenue growth of the business.

The after-sales services business raised 1.88 trillion won in sales, down 3.3 percent due to the virus-led slowdown in the global automobile market.

Hyundai Mobis received total $1.76 billion worth new orders, achieving its annual target of $1.68 billion despite the virus pandemic. It now targets to increase its order volume to $2.88 billion this year by expanding product portfolio and engaging in various sales promotion activities.

Last year, the company spent 1.02 trillion won in R&D and secured 5,387-strong staff for that. Its capital spending for full 2021 would expand to 1.2 trillion won including 1.07 trillion won for R&D, it said.

In a separate disclosure, Hyundai Mobis announced on the same day that it would cancel 261,600 own shares worth 57.83 billion won on Feb. 1.

By Lee Ha-yeon

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