KT Corp.’s corporate logo is shown at its headquarters building in central Seoul on July 2, 2020. (Yonhap)
SEOUL, Nov. 6 (Korea Bizwire) — KT Corp., a major South Korean telecom operator, said Friday its net income rose 7.9 percent in the third quarter from a year earlier due to cost reduction.
Net income reached 230.1 billion won (US$204 million) in the July-September period on a consolidated basis, compared with a profit of 213.3 billion won the same quarter a year earlier, according to a regulatory filing.
KT said it saved some costs involving its hardware infrastructure for wireless services in the third quarter, which boosted its bottom line.
Sales fell 3.4 percent to 6 trillion won over the cited period, while operating income stood at 292.4 billion won, down 6.4 percent over the cited period.
KT blamed its disappointing performance in sales and operating profit on the coronavirus pandemic.
Its major non-telecom units saw a decrease in sales in the third quarter, with the carrier’s satellite broadcasting unit KT Skylife Co. posting a 3.1 percent decline in sales to 176.6 billion won in the July-September period.
Sales in KT’s real estate unit, KT estate, tumbled 39.4 percent to 76.2 billion won over the cited period.
KT said that increased labor costs also chipped away at its third quarter operating profit.
The telecom operator’s wireless business showed little growth in the quarter, with sales standing at 1.7 trillion won, up 0.9 percent from a year earlier.
KT Corp. researchers inspect 5G equipment at the telecom operator’s offices in southern Seoul, in this photo provided by the company on Sept. 16, 2020.
KT’s 5G subscribers reached 2.8 million as of the July-September period, accounting for around 20 percent of the carrier’s total mobile phone subscribers.
The company, however, said Apple Inc.’s new 5G iPhone 12 launched last month will accelerate its subscriber migration to the latest generation network, estimating that 5G users will account for 25 percent of its mobile phone subscribers by the end of this year.
The carrier’s internet protocol TV (IPTV) business reported robust growth in the third quarter as sales rose 11.9 percent on-year to 459.3 billion won thanks to a boost in subscribers.
KT said it had 8.69 million IPTV users as of the third quarter, up 5.6 percent from the same quarter a year earlier.
The carrier said its move to provide its IPTV subscribers access to Netflix in August fueled growth.
KT remained upbeat about its performance going forward, saying it will likely reach 1 trillion won in operating profit on a standalone basis in 2022 even by conservative estimates.
Its cumulative operating profit as of the third quarter this year stood at 759.1 billion won on a standalone basis.
KT also announced in a separate regulatory filing that it will buy back 300 billion won worth of its shares over a one-year period starting Friday to improve shareholder value.
The company said in the conference call that it believes its current stock price is undervalued.
Shares in KT closed flat at 22,900 won, roughly in line with the broader KOSPI’s 0.11 percent gain.
(Yonhap)
