Ssangyong Motors returns to profit

Ssangyong Motors Co. on Friday posted net profits of 8.1 billion won ($7.2 million) for 2010, marking a return to profit after two years in the red.

The company, which recorded net loss of 346 billion won in 2009 and 710 billion won in 2008, said that rising sales and cost-cutting efforts allowed it to return to profit.

Last year, the company’s domestic and overseas sales increased by 131.6 percent from 2009 to come in at 82,000 units, pushing up sales in terms of value to 2.07 trillion won from the 1.07 trillion won recorded in the previous year.

According to Ssangyong, last year’s sales figure is about 19 percent higher than the 68,562 units target stated in its revival plans.

Much of the rise was fueled by an increase in exports, which saw an increase of 276 percent from 2009.

Over the same period, Ssangyong’s domestic sales increased by 46.3 percent to about 32,000 units.

Ssangyong remains in the red in terms of operating profits, having recorded an operating loss of 55 billion won last year. The company attributed the continuing operating loss to the rise in materials costs.

However, the company has managed to significantly reduce losses compared to the two previous years.

In 2009, the company recorded an operating loss of more than 293 billion won, while the figure came in at 227 billion won in 2008.

By Choi He-suk (cheesuk@heraldcorp.com)