Kia turns to Q1 op profit on won, local sales

SEOUL, April 25 (Reuters) - Kia Motors Corp (000270.KS: Quote, Profile, Research, Stock Buzz), South Korea's No. 2 auto maker, said on Friday it swung to a first quarter operating profit, aided by solid sales in the higher-margin local market.

Kia, an affiliate of the country's top car maker Hyundai motor Co (005380.KS: Quote, Profile, Research, Stock Buzz), posted a 102 billion won ($102.4 million) operating profit in the first quarter, beating a 30 billion won profit forecast by eight analysts in a Reuters poll. That compared to a 73.7 billion won operating loss a year ago and a 97.7 billion won profit in the fourth quarter of 2007.

Kia reported a net loss of 24.8 billion won, a little worse than the expected 21.3 billion won net loss forecast.

A softer won is expected to bolster Kia's profit this year as it sells almost 80 percent of its products abroad and on higher sales of the Morning minicar.

But a fall in the won held the maker of the Sportage sports utility vehicle (SUV) back from a significant profit improvement as it bolsters value of foreign currency debt, analysts say.

A lack of hit models, especially higher-end vehicles, and rising prices of oil and raw materials also put pressure on the company, they added.

Shares in Kia rose 12.9 percent during the January-March period, outperforming a 10.2 percent fall in the broader market . ($1=996.0 Won) (Reporting by Cheon Jong-woo; Editing by Keiron Henderson)