[Click eStock] "SK Telecom Approaches 10% Operating Profit Margin for the First Time in 8 Years"
Daishin Securities analyzed that SK Telecom (SKT) achieved an annual operating profit margin close to 10% in 2023. The investment rating 'Buy' and the target price of 77,000 KRW were maintained.
![[Click eStock] "SK Telecom Approaches 10% Operating Profit Margin for the First Time in 8 Years"](http://www.asiae.co.kr/news/img_view.htm?img=2024011108462225785_1704930382.png)
Kim Hoe-jae, a researcher at Daishin Securities, stated, "SKT's Q4 2023 revenue is expected to be 4.5 trillion KRW, with an operating profit of 300 billion KRW," adding, "As of October 2023, the 5G penetration rate is 66.6% compared to mobile phones, and the 5G market share is 48.1%, significantly exceeding the overall wireless market share of 46.3%." Marketing expenses are projected to be 770 billion KRW (24.1% of revenue), which is below the post-5G introduction average of 25.6%. Depreciation expenses (640 billion KRW) are also expected to account for 19.9% of revenue, lower than the post-5G introduction average of 21.2%. Including Q4, the total revenue for 2023 is forecasted at 17.622 trillion KRW, with an operating profit of 17.56 trillion KRW. The operating profit margin is 9.97%.
SKT's operating profit margin nearing 10% is the first time since 2015. In 2015, revenue was 171.367 trillion KRW, and operating profit was 1.708 trillion KRW, resulting in an operating profit margin of 9.97%. The operating profit margin declined to 9% in 2016, 8.8% in 2017, 7.1% in 2018, and 6.3% in 2019, before rebounding to 7.2% in 2020. It was 8.2% in 2021 and 9.3% in 2022.
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Researcher Kim expects SKT's 2024 revenue to be 18.075 trillion KRW, with an operating profit of 1.908 trillion KRW. This forecasts a return to a 'double-digit operating profit margin' for the first time in 10 years since 2014. SKT's 2014 revenue was 171.637 trillion KRW, with an operating profit of 1.825 trillion KRW, resulting in an operating profit margin of 10.6%. Kim added, "The 2024 dividend policy is also expected to guarantee a level similar to the existing 720 billion KRW," and "After the ongoing 300 billion KRW share repurchase and 200 billion KRW cancellation through January 2024, the dividend per share (DPS) is expected to be around 3,500 KRW."
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