Seoul, Oct. 30 (Reuters): Hyundai Motor Co said on Monday its third-quarter net profit nearly halved, while affiliate Kia Motors Corp swung to a loss as both were hurt by labour disputes and a firmer won currency.

Hyundai, the world’s No 6 auto maker along with Kia, should see earnings improve in the current quarter, analysts said, as overseas sales outweigh sluggish demand in its home market.

“Hyundai’s results missed expectations as sales were much lower than forecast amid the strikes, but the fourth-quarter should be better, helped by a post-strike order backlog,” said Yong Dae-in, an auto analyst at Goodmorning Shinhan Securities.

“Next year, exports are expected to propel Hyundai’s earnings although the outlook for the local sales is not so good,” he added.

Hyundai, which controls half the South Korean auto market, earned a July-September net profit of 282.8 billion won ($298.6 million), down 47.1 per cent from 534.9 billion won a year ago and well short of a 389.2 billion won forecast by nine analysts polled by Reuters.

Operating profit, dented by a month-long strike, fell by nearly a third to 183.2 billion won.

“The drop in third-quarter earnings was not because its sales were sagging, but the limited supply due to strikes failed to meet demand,” said Kang Sang-min, analyst at Tongyang Investment.

Hyundai, which makes the Sonata sedan and Santa Fe SUV, booked an 18.9-billion-won ($20 million) loss from derivatives linked to Kia, versus a 134 billion won profit a year earlier, according to a company official.

Kia’s third quarter saw its first net loss since Hyundai bought into the company in 1999, hit by higher marketing costs.

Kia is seen under more pressure amid intense competition in a weaker domestic market, although some analysts see some hope with its higher-end models such as the Opirus sedan.

Hyundai shares fell 1.58 per cent to 74,900 won by 0447 GMT, underperforming the broad index’s 1.03 per cent drop. Kia was off 1.03 per cent.

Hyundai’s full-year profit is seen dropping by nearly a fifth to 1.86 trillion won from 2.31 trillion last year, according to 25 analysts surveyed by Reuters Estimates, indicating fourth-quarter profit may rise by a third to 871.1 billion won.

The won on average rose 7.8 per cent versus the dollar in July to September, but eased 0.5 per cent from April-June.

Hyundai’s third-quarter sales fell 4.3 per cent to 5.89 trillion won as sales volume from local plants fell 6 per cent.

Hyundai Motor said the strikes cost the company 1.3 trillion won, or 93,882 vehicles in lost output.