Topline trend was better as B2B division improved while KT Cloud and KT Estate sustained double-digits growth again. While the company had earlier announced plans to expand its AI/ICT staff pool by up to 1k this year, so far labour costs remained under control as it is being offset by natural attrition of retirees.
LG Uplus’ numbers improved from last quarter. Faster service revenue trend was led by improvements across the board, with continued strength in Enterprise. Bottom line was however weak off higher wage, D&A and interest costs. Our brief takeaway below.
Topline came in better than expected, supported by a better mobile performance from higher roaming users well as sustained performance from SK Broadband. EBITDA was relatively in line while net profit beat on expectations this quarter (12% ahead), helped by other income from its investment assets. Our thoughts below.
SK Telecom has issued its new shareholder return policy for the next three years (2024-2026), at least 50% of adjusted consolidated net profit in the form of dividends and share repurchases. The headline figure is somewhat underwhelming, but is now a minimum rather than a cap and could be the first of more initiatives to come as a result of the "Value-up" programme in Korea. Our thoughts below.
Three Directors at LG Uplus Corp bought/maiden bought 12,000 shares at between 10,020.000KRW and 10,050.000KRW. The significance rating of the trade was 69/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the compa...
We ran our Asia Telco tour last week. This time we met 12 companies in 3 countries (Korea, Japan, Thailand). Telco share prices in all 3 of these countries have been pretty strong recently as telcos continue to benefit from generally positive themes: growth, return on capital and shareholder remuneration are all typically improving.
We met with all 3 of the Korean Telcos in Seoul over the last couple of days. All 3 are committed to engaging with and following the government “Value-up” programme, with the industry having started to become more shareholder friendly 2-3 years ago. We see the potential for higher industry returns (lower capex, opex) as well as better shareholder remuneration. Change will take time, but patient investors are set to do well from Korea as the market finally finds its place in the sun we think. Top...
South Korean operators were slower across the board at service revenue on softer Fixed growth, although mobile and Enterprise kept pace. Both LG and SKT saw an acceleration in Enterprise this quarter as the former opened a new DC in Q4. Both SKT and KT saw improvements in EBITDA while LG was pressured by higher labour costs.
SKT delivered better results today as topline growth accelerated off Enterprise and margins improved again. Shareholder remuneration continues to improve as the company also announced its final quarterly dividend at KRW 3,540 taking full year’s dividends to KRW 766bn, an increase of 5.8% from last year.
2023 saw Govt interference in industry pricing, competition and management offsetting good fundamentals. With elections in April this may continue near term. However, despite this the industry continues to grow cash flow, which should also continue, and taking a slightly longer perspective shows that KT and SKT (although not LG U-Plus) are still trending higher.
South Korean telco saw a slower quarter as improvements at SKT and LG were offset by KT’s slowdown, attributable to its subsidiaries (slower BC Card, declines at Content and Skylife). Nevertheless, core mobile and Enterprise trends improved, with broadband stable.
Aggregate service revenue were lifted by KT’s non-mobile performance this quarter, with strong EBITDA growth from both KT and LG owing to well controlled labour and service costs. Encouragingly too, 1H23 aggregate capex intensity was lower (12.6% vs. 13.5% last year) despite a focus on AI investments recently.
Today, South Korea's Ministry of Science and ICT ("MSIT") unveiled plans aimed at lowering the average household mobile spending, by encouraging lower mobile price plans and fostering greater mobile competition through 1) incentivising a fourth mobile operator, 2) promoting MVNO competitiveness through wholesale provisions and 3) raising the subsidy cap on Mobile Device Distribution Act from 15% to 30%
South Korean carriers delivered LSD service revenue growth again, driven off mobile and Enterprise, with EBITDA lighter than previous quarters. Service revenue grew 2.9% (Q4: 3%) while EBITDA growth slowed to 1.8% YoY, dragged by both KT and LG. Mobile ARPU trend remains positive, with 5G penetration (off handset base) at 61%.
In this note we revisit and update our thesis that Enterprise in EM is following an S-Curve. Key new work shows that as a result, absolute incremental Enterprise revenue in China has doubled each year for the past 3 years. This is why overall Telco revenues have sharply accelerated. We show the other countries/ stocks where the early signs are of the same thing happening.
Today, KT announced its current President, Yun Kyoung Lim, as the final CEO candidate. He was selected out of the final four candidates – two current KT executives and two former ones – after filtering from the initial list of 33 internal and external candidates. This came after KT’s current CEO, Ku Hyeon-mo, decision to step down from the selection process in February following pressure from one of its stakeholders.
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