KT Q3 Operating Profit Down 6.4% YoY... "Acquisition of 300 Billion KRW Treasury Shares" (Comprehensive)

Sales of 6.012 Trillion KRW · Operating Profit of 292.4 Billion KRW

[Asia Economy Reporters Heungsun Kim, Chaeun Koo] KT announced on the 6th that its operating profit on a consolidated basis for the third quarter of this year was 292.4 billion KRW, down 6.4% compared to the previous year.

Revenue was 6.0012 trillion KRW, a decrease of 3.4% compared to the same period last year. Net profit for the period increased by 7.9% to 230.1 billion KRW. The total operating profit for this year exceeded 1 trillion KRW in just three quarters, reaching 1.0173 trillion KRW.

KT stated, "Overall revenue this quarter decreased compared to the same period last year due to reduced sales of devices and group companies caused by the novel coronavirus disease (COVID-19)," but added, "Service revenue grew by 0.8% year-on-year as B2B businesses such as wireless, Internet TV (IPTV), and artificial intelligence (AI) expanded." KT's standalone operating profit for the third quarter also increased by 4.6%.

According to business segment performance, the wireless business saw revenue increase by 0.9% year-on-year, driven by the expansion of 5G subscribers. The cumulative number of 5G subscribers in the third quarter was 2.81 million, about 20% of KT’s total mobile subscribers. KT explained, "The 'Super Plan Choice' unlimited 5G plan, which adds content benefits such as video and music, received positive customer response." Following the recent launch of a Netflix bundle plan and the release of the iPhone 12 at the end of last month, KT plans to focus on popularizing 5G.

Revenue from ultra-high-speed internet and fixed-line telephone services decreased by 0.3% and 7.0%, respectively, compared to the same period last year. The IPTV business recorded double-digit growth in both net subscriber additions and revenue. Thanks to partnerships such as with Netflix, 128,000 new subscribers were added this quarter, bringing the cumulative subscriber count to 8.68 million. With the conclusion of home shopping transmission fee negotiations, revenue increased by 11.9% year-on-year.

The AI/DX business saw cumulative revenue grow by 17% year-on-year through the third quarter. KT opened its 13th data center in Yongsan, Seoul, the day before. Leveraging its network infrastructure strengths, KT plans to aggressively target the B2B market with a differentiated platform of 'ABC'?Artificial Intelligence (AI), Big Data, and Cloud.

Some group companies’ revenues were affected by COVID-19. BC Card’s revenue decreased by 0.6% year-on-year due to reduced travel and consumption. Estate, which operates in the hotel business, saw revenue drop by 39.4% compared to the previous year. Meanwhile, content subsidiaries’ revenue increased by 8.6% due to strong performance in T-commerce and advertising businesses.

KT also announced on the same day that it decided to enter into a trust contract for acquiring treasury stock worth 300 billion KRW to stabilize its stock price and enhance shareholder value. KT stated, "CEO Koo Hyun-mo will lead efforts to enhance corporate value and strengthen shareholder returns through B2B business leadership and treasury stock purchases."

This content was produced with the assistance of AI translation services.