KT Corp.’s corporate logo is shown at its headquarters building in central Seoul on July 2, 2020. (Yonhap)
SEOUL, Aug. 7 (Korea Bizwire) — South Korean telecom giant KT Corp. said Friday its second-quarter net income rose 2.2 percent from the previous year on the back of reduced costs amid the pandemic and growing demand for its non-mobile services.
Net income reached 207.6 billion won (US$174.7 million) in the April-June period, compared with 203 billion won the previous year, KT said in a regulatory filing.
Sales stood at 5.88 trillion won in the second quarter, down 3.6 percent on-year, weighed down by poor performances from its major subsidiaries amid the COVID-19 pandemic.
Cost-cutting efforts, however, helped offset the sales decline, according to the company, with operating expenses falling 4.7 percent to 5.5 trillion won over the same period.
KT’s business-to-business service remained strong, with related sales standing at 701.1 billion won in the April-June period, up 2.4 percent on-year.
Sales from the company’s artificial intelligence and digital business, which includes internet data center and cloud services, rose 16 percent to 139.4 billion won over the same period.
Its mobile business saw sales edge up just 0.6 percent on-year to 1.7 trillion won in the second quarter despite the number of 5G subscribers reaching 2.24 million as of the April-June period, from just 419,000 the previous year.
The mobile carrier said a decline in roaming plan sales was responsible for the weaker-than-expected result, as the pandemic halted air travel.
KT estate Inc. employees check its smart building monitoring system at the company’s office in Seongnam, south of Seoul, in this photo provided by KT Corp. on July 28, 2020.
The company remained upbeat about its mobile business for the second half this year, considering the launches of new 5G phones, including Samsung Electronics Co.’s Galaxy Note 20 and Apple Inc.’s iPhone.
“We expect to meet our year-end target of 3.5 million 5G subscribers,” Yoon Kyung-keun, KT’s chief financial officer, said in a conference call. “With the launch of new phones, 5G subscribers will likely account for 25 percent of our handset subscriptions.”
As of the second quarter, KT’s 5G users accounted for 16 percent of its total 14.3 million phone subscribers.
While KT’s IPTV business saw sales rise just 0.5 percent on-year to 407.6 billion won in the second quarter, it expects the business unit’s performance to improve through its agreement with video streaming giant Netflix Inc. to introduce the service to its IPTV.
Yoon said the partnership will lead to more IPTV subscribers, adding that Netflix will supplement KT’s own over-the-top platform Seezn in terms of content.
KT’s credit card subsidiary BC Card Co. reported sales of 867.1 billion won in the second quarter, down 1.5 percent on-year, as consumers spent less during the pandemic.
Real estate subsidiary KT Estate Ltd. also saw sales fall 7.9 percent to 104.4 billion won over the same period.
(Yonhap)
