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By Bloomberg

Hyundai Motor Co. reported profit that missed analyst estimates after the yen and Russia’s ruble weakened, eroding overseas earnings at South Korea’s largest carmaker. Its shares fell.

Net income fell 19 percent to 1.66 trillion won ($1.5 billion) in the fourth quarter from 2.06 trillion won a year earlier, the Seoul-based company said in a statement today. That was less than the 2.01 trillion won average of 26 analyst estimates compiled by Bloomberg.

A weaker yen gave Hyundai’s Japanese rivals including Toyota Motor Corp. a competitive edge overseas, while a plunge in the ruble lowered the value of earnings in Russia. The company is counting on new versions of its Tucson sport utility vehicle and Elantra sedan to boost sales this year.

“This year will be a slow year with little volume growth expected,” Lee Sang Hyun, an analyst at IBK Investment & Securities Co., said before the earnings announcement. New models like the Tucson and Elantra will help the company increase sales in key markets, he said.

Hyundai shares fell as much as 4.1 percent in Seoul trading, underperforming the broader Kospi stock index, after the company reported earnings.

The result caps a year in which Hyundai’s shares plummeted 29 percent, mainly due to a 10.6 trillion won property purchase announced in September.

Fourth-quarter operating profit, or sales minus the costs of goods sold and administrative expenses, fell 7.6 percent to 1.88 trillion won. That compares with the 1.99 trillion won average of analyst estimates.

Full Year

Full-year net income dropped 14 percent, the most since 2008, while sales increased 2.2 percent.

The won appreciated 5.7 percent against the yen in the fourth quarter, according to data compiled by Bloomberg. The ruble’s 33 percent slump against the South Korean currency reduced the value of repatriated earnings from Russia, where Hyundai produced and sold 237,000 vehicles last year, according to company data.

Hyundai said Jan. 2 it plans to increase global sales by 1.7 percent, the slowest growth since 2006, to 5.05 million vehicles this year.

“The restriction comes from the lack of new plants opening or new lines beginning production this year,” said Lee at IBK.

Hyundai and Chinese partner BAIC Motor Corp. will expand production in China by 57 percent by adding two plants with annual output capacity of 300,000 vehicles each in Chongqing city and Cangzhou, Hebei province, they said Dec. 30. Hyundai plans to begin production at the new plants in 2016.

China Sales

The carmaker’s sales in China rose 8.4 percent last year, trailing the industry average of 9.9 percent, according to data from Hyundai and the China Association of Automobile Manufacturers.

In the U.S., Hyundai sold a record 725,718 vehicles in 2014, although its market share fell to 4.4 percent from 4.6 percent in 2013. Fourth-quarter sales declined 1.9 percent to 168,260.

Hyundai’s shares plunged last year after the company said in September it had won an auction, along with affiliates Kia Motors Corp. and Hyundai Mobis Co., for a property in South Korea’s central Gangnam district where they plan to develop the area and relocate its headquarters. Hyundai’s winning bid was triple the assessed price.

To ease investor discontent, Hyundai and Kia said in November they plan to spend 670 billion won to buy back stock by Feb. 11 this year. Lee Won Hee, Hyundai’s chief financial officer, said in October the carmaker will consider an interim dividend payout.