Hyundai 2004 Annual Report Download - page 4

Hyundai Motor Company Annual Report 2004_06
Letter from the Vice Chairman
The ‘Yeas’ have it...
The Motion is Unanimous
The year 2004 was one of significant events both
large and small. With unstable oil prices in the
global market and the continuing depreciation of
the dollar, the overall economic environment in
Korea deteriorated, and thus, the domestic mar-
ket this year was slow.
However, we at Hyundai Motor Company
achieved solid financial results by selling 1.68 mil-
lion vehicles and recording sales of US$26.3 bil-
lion/27.5 trillion Korean Won, thanks in large
measure to the support and confidence you, our
esteemed shareholders, have placed in the cur-
rent management team.
Our efforts to make the most of overseas markets
paid off. Export sales increased by 2 percent
overall this year, including a considerable boost
of 10 percent in countries where we are actively
marketing, such as the United States. This more
than makes up for domestic losses of 13.2 percent
in sales.
Last year, Hyundai Motor Company recorded a
profit of US$2.39 billion/2.5 trillion Korean Won
with a net profit of US$1.72 billion/1.8 trillion
Won. These demonstrate an increase of 6.0 per-
cent and 2.0 percent respectively, compared with
the previous year. We also improved the debt
ratio and debt loan ratio from 94.0 percent and
20.7 percent to 82.5 percent and 13.6 percent
respectively. Because of the sharp rise in the cost
of raw materials this year, coupled with the
won-dollar revaluation, our operating profits
decreased slightly. However, our efficient man-
agement, including our subsidiary operators,
reduced the total financial expenses of the com-
pany.
These accomplishments were the result of our
efforts to increase our market share (which we
did by 2.6 percent) through the launching of our
new model, the NF Sonata, as well as the remar-
keting of our flagship models, the Santa Fe and
Elantra. We have the flexibility to rapidly adjust
to changing overseas markets as well, as evi-
denced by our export of 1.127 million vehicles
this year. This corresponds to an increase of 11.4
percent on imports over last year. As you can see,
we are continually enhancing our brand value in
overseas markets.
We will use this enhanced brand value to pro-
mote high-end vehicles in the American market.
In the European market, we plan on launching
new models. In India and China, which we con-
sider to be regions with great potential, we have
devoted ourselves to localized management,
making it possible to increase our production
capacity in those emerging markets very quickly,
as local demand dictates.
Our product quality, the basic element of mar-
keting, has been highly evaluated by authorita-
tive foreign agencies and media. According to
the Initial Quality Survey conducted by J.D.
Power and Associates in the United States, the
Sonata was ranked Number One among
mid-sized cars. Also, it was gratifying to see that
the Hyundai XG, Sonata, and Santa Fe were all
recommended by the most influential consumer
products review magazine in the United States.
We passed a major milestone this year when our
cumulative export total surpassed the 10 million
mark — a remarkable achievement in just 28
years. Our very first domestic model, the Pony,