SEOUL, South Korea — Kumho Tire Co. Inc. is projecting record sales in the second half of 2023, based on a restructuring of its global distribution network and expansion of global production capacity,
Kumho, the No. 16 tire company globally based on fiscal 2022 revenue, more generated 116.4% better pre-tax operating income for the half year of $214 million on 22.7% higher sales of $1.55 billion.
As a result, the operating ratio jumped nearly six points to 13.8%. The net result returned to the black for the half-year period, at $37 million, in contrast to a net loss of $28 million a year ago.
The bulk of the firm's growth in 2023 has come from Europe, where sales revenue in the second quarter was up nearly 46%. Revenue for the first six months of the fiscal year jumped to $378 million.
Sales in North America, by contrast, fell slightly (2.2%) during the second quarter. Revenue for the first half stood at $475 million, and the region remains Kumho's largest business unit, accounting for nearly 31% of global revenue.
Kumho CEO Jeong Il-Taek projects that revenue and profitability will continue to improve in the second half in part due to the firm's growing original equipment business with vehicle makers worldwide as well as access to greater production capacity, such as the completion of expansions at plants in the U.S. and in Vietnam.
In the U.S., workers at Kumho Tire Georgia in Macon, Ga., ratified their first labor contract at plant recently, more than two years after the United Steelworkers was certified as the workers' bargaining agent.