Core Viewpoint - Korea Electric Power Corporation (KEPCO) has filed its annual report for the year ended December 31, 2024, with the U.S. Securities and Exchange Commission, indicating a commitment to transparency and regulatory compliance [1]. Group 1 - The annual report includes audited consolidated financial statements, which are essential for investors to assess the company's financial health [1]. - The report is accessible on KEPCO's official website and the U.S. Securities and Exchange Commission's website, providing easy access for investors [2]. - Investors can request a hard copy of the 2024 Annual Report on Form 20-F free of charge, demonstrating the company's willingness to facilitate investor engagement [2].

Fuel Costs and Pricing - In 2024, fuel costs constituted 27.5% of the company's cost of sales, with the ratio of fuel costs to sales at 24.3%[33] - The company implemented a new cost pass-through tariff system on January 1, 2021, linking incurred costs to tariffs charged to customers[37] - The maximum adjustment for the Fuel Cost Adjusted Charge is limited to Won ±5 per kilowatt-hour from the Base Fuel Cost[38] - The company increased the Usage Charge by Won 11.4 and Won 8.0 per kilowatt-hour in January and May 2023, respectively, to reflect increases in the Base Fuel Cost[43] - Starting from October 24, 2024, the company will increase electricity tariffs on industrial consumers by an average of Won 16.1 per kilowatt-hour, representing an average increase of 9.7%[43] Energy Market and Supply - Approximately 97.2% of the bituminous coal requirements were purchased under long-term contracts in 2024, with the remaining 2.8% from the spot market[33] - The average weekly spot price of Newcastle coal decreased from $106.38 per ton in 2023 to $90.79 per ton in 2024, and further decreased to $70.50 per ton as of March 31, 2025[33] - The average daily spot price of Dubai crude oil decreased from $81.93 per barrel in 2023 to $79.67 per barrel in 2024, and further decreased to $73.38 per barrel as of April 3, 2025[36] Regulatory and Compliance Risks - The company is subject to various risks, including fluctuations in fuel prices and government regulations affecting electricity tariffs[30] - The government has discretion to not adjust the quarterly Fuel Cost Adjusted Charge in case of extenuating circumstances, which may impact profit margins[40] - The company may face significant compliance costs and operational liabilities due to various environmental regulations and initiatives[60] - The company intends to fully comply with environmental obligations, which may result in increased operating costs and liquidity requirements[61] - The company is exposed to potential claims for unpaid wages under the expanded scope of ordinary wages, which could lead to increased labor costs[119] Financial Performance and Losses - From 2021 to 2023, the company experienced substantial operating and net losses due to rapidly increasing fuel prices[44] - The company experienced net losses from 2021 to 2023 due to rising global energy prices and increased power purchase costs, leading to higher debt issuance[76] - The company’s debt ceiling was increased to five times the sum of share capital and reserves, effective until December 31, 2027, allowing for more debt securities to cover losses and finance capital expenditures[76] Energy Transition and Future Plans - The Eleventh Basic Plan announced in February 2025 aims to increase nuclear power capacity from 24.7 gigawatts in 2023 to 35.2 gigawatts by 2038[52] - Coal power capacity is expected to decrease from 39.2 gigawatts in 2023 to 22.2 gigawatts by 2038, while LNG power capacity is projected to increase from 43.2 gigawatts in 2023 to 69.2 gigawatts by 2038[53] - Renewable energy generation capacity is expected to increase from 30.0 gigawatts in 2023 to 121.9 gigawatts by 2038 as part of the Eleventh Basic Plan[53] - The company plans to establish an Eleventh Long-Term Transmission and Substation Facilities Plan in 2025 to meet increasing demand and achieve carbon neutrality[54] - KEPCO aims to achieve carbon neutrality by 2050 and plans to enhance grid capability for connecting renewable energy units through proactive construction of power facilities[169] Labor and Employment Issues - Approximately 73.5% of the company's employees are members of labor unions, which may pose risks of labor unrest affecting operations[95] - The company is transitioning non-permanent workers to permanent positions, which may increase costs and impact financial conditions[96] Cybersecurity and Operational Risks - The company is subject to increased risks from cybersecurity threats, including potential breaches that could materially impact operations and financial condition[126] - The company carries insurance for its nuclear generation units, but coverage is limited and may not cover all potential losses from serious accidents[115] Market and Economic Influences - The company is significantly dependent on the Korean economy, with most income generated from Korean consumers' demand for electricity, which is influenced by global economic conditions[135] - Political instability in Korea, including the impeachment of President Yoon Suk Yeol, may disrupt the economic landscape and adversely affect business operations[136] - Factors such as inflation, interest rate increases, and geopolitical conflicts could negatively impact the Korean economy and, consequently, the company's financial performance[138] Electricity Generation and Pricing - The price of electricity in Korea is determined by a cost-based pool system, with the system marginal price reflecting the variable cost of generating electricity[193] - The capacity price, which compensates for fixed costs, is determined by factors including reference capacity price and reserve capacity factor, with the current reference capacity price ranging from Won 11.00 to 14.41 per kilowatt-hour[203] - The performance capacity factor was introduced in June 2022 to incentivize operational flexibility of generation units, replacing the previous fuel switching factor[206] Corporate Governance and Ownership - The Government maintains a 51.1% ownership stake in KEPCO, ensuring control over significant corporate matters, including dividend approvals[162] - Foreign investment in the company is subject to a 40% ceiling, with a 3% limit on single investor acquisitions, potentially restricting capital inflow[149][150]

Core Insights - EZCORP is identified as a potential beneficiary of President Trump's tariff uncertainty, particularly due to its focus on providing pawn loans to low-income consumers [1] Company Analysis - EZCORP's business model may benefit from weakening economic growth driven by tariffs, as it caters to a demographic that may require financial assistance during economic downturns [1]

Financial Performance - Total sales for 2024 reached W 93,398,896 million, an increase of 5.4% compared to W 88,219,461 million in 2023[31]. - Operating profit for 2024 was W 8,364,710 million, a significant recovery from an operating loss of W 4,541,648 million in 2023[31]. - Profit for the year in 2024 was W 3,621,968 million, compared to a loss of W 4,716,144 million in 2023, marking a turnaround in financial performance[33]. - Gross profit for 2024 was W 11,434,736 million, a recovery from a gross loss of W 1,480,066 million in 2023[31]. - Finance income increased significantly to W 3,448,177 million in 2024, compared to W 1,425,031 million in 2023, reflecting a growth of 142.2%[31]. - Other comprehensive income for 2024 was W 629,001 million, compared to a loss of W 228,672 million in 2023, indicating a positive shift in comprehensive income[33]. - Basic and diluted earnings per share improved to W 5,439 in 2024 from a loss of W 7,512 in 2023[33]. - The profit for the period ended December 31, 2024, was W3,621,968 million, a significant recovery from a loss of W4,716,144 million in 2023[38]. Assets and Liabilities - Korea Electric Power Corporation's total assets increased to W246,807,795 million in 2024 from W239,714,965 million in 2023, representing a growth of approximately 2.3%[28]. - Total liabilities increased to W 205,444,962 million in 2024 from W 202,450,215 million in 2023, reflecting a rise of 1.5%[29]. - Total current assets slightly decreased to W29,255,205 million in 2024 from W29,536,215 million in 2023, a decline of about 1.0%[28]. - Current financial liabilities increased to W 44,465,866 million in 2024 from W 41,139,726 million in 2023, representing a rise of 5.7%[29]. - The Group's deferred tax assets amounted to W13,436,624 million in 2024, compared to W13,161,802 million in 2023, showing an increase of approximately 2.1%[28]. - The total liabilities decreased to W41,362,833 million as of December 31, 2024, from W37,264,750 million at the beginning of the year[36]. Cash Flow - Cash generated from operating activities increased to W20,962,957 million in 2024, compared to W5,978,734 million in 2023[39]. - The company reported a net cash flow provided by operating activities of W15,876,116 million for 2024, up from W1,522,162 million in 2023[39]. - The company’s cash and cash equivalents decreased to W2,382,979 million as of December 31, 2024, from W4,342,887 million at the beginning of the year[39]. Investments and Equity - The Group's investments in joint ventures increased to W4,581,340 million in 2024 from W3,485,699 million in 2023, representing a growth of approximately 31.5%[28]. - Total equity attributable to owners of the controlling company rose to W 39,915,236 million in 2024, up from W 35,845,043 million in 2023, indicating a growth of 11.6%[29]. - The Group's investments in associates and joint ventures as of December 31, 2024, totaled W 11,286,094 million, compared to W 9,662,588 million in 2023, reflecting a growth of approximately 16.8%[196]. Revenue Recognition and Accounting Policies - The Group recognizes revenue over time for construction contracts using the cost-based input method, which reflects the Group's progress towards completion[54]. - The Group recognizes revenue based on the percentage-of-completion for contracts such as EPC business and O&M[96]. - The Group's accounting policies require the measurement of fair values for both financial and non-financial assets and liabilities, with a control framework established for fair value measurement[50]. - The Group's accounting for business combinations follows the acquisition method, measuring the consideration transferred at fair value[67]. - The Group recognizes revenues from construction and operating services related to service concession arrangements in accordance with KIFRS 1115[178]. Impairment and Provisions - The impairment assessment of property, plant and equipment was identified as a key audit matter due to the significant difference between the Group's market capitalization and the carrying amount of net assets[14]. - Management assessed indications of impairment for the electricity transmission and distribution business as of December 31, 2024, based on the recoverable amount of cash-generating units[15]. - The Group conducts impairment assessments for cash-generating units (CGUs) related to electricity sales, estimating value-in-use based on discounted cash flow forecasts[155]. - Provisions for decommissioning costs of nuclear power plants, reflecting the fair value of estimated costs as a liability[161]. - Provisions for renewable energy generation under the Renewable Portfolio Standard (RPS) are recognized to meet governmental regulations[161]. Segment Information - For the year ended December 31, 2024, total segment revenue was W 93,398,896 million, an increase from W 88,219,461 million in 2023, representing a growth of approximately 5.5%[194]. - The operating profit for the Transmission and Distribution segment was W 3,166,658 million in 2024, compared to a loss of W 6,503,917 million in 2023, indicating a significant recovery[194]. - The Electric Power Generation (Nuclear) segment reported an operating profit of W 1,577,798 million in 2024, up from W 797,309 million in 2023, reflecting a growth of approximately 97.7%[194]. - Revenue from domestic customers for the year ended December 31, 2024, was W 92,107,468 million, up from W 86,985,859 million in 2023, marking an increase of approximately 5.5%[198].

Group 1 - The article presents a bullish view on Korea Electric Power Corporation (KEPC), highlighting its progress in financial improvement and shareholder returns as key drivers for stock price [1] - The research service Asia Value & Moat Stocks focuses on identifying Asia-listed stocks with significant gaps between price and intrinsic value, emphasizing deep value balance sheet bargains and wide moat stocks [1] - The author provides investment ideas specifically for value investors interested in the Hong Kong market, offering monthly updates and watch lists [1]

Company Overview - Korea Electric Power Corporation (KEPCO) is the sole distributor of electricity in South Korea [2] Market Position - KEPCO holds a monopoly position in the South Korean electricity distribution market [2] Financial Performance - The company has faced multiple headwinds from 2021 to 2023, leading to a significant decline in its stock price [2] Strategic Initiatives - KEPCO has implemented strong commitments to cost-cutting measures to improve its financial position [2]

Korea Electric Power Corporation 2024 3rd Quarter Disclaimer This presentation material is being presented to you solely for your information and may not be taken away by you and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, in whole or in part, for any purpose. This presentation material is not an offer or sale of securities of Korea Electric Power Corporation ("KEPCO" or the "Company") in the United States or other jurisdictions, and does not ...

NAJU, South Korea, April 30, 2024 /PRNewswire/ -- On April 30, 2024, Korea Electric Power Corporation (NYSE: KEP) ("KEPCO") filed its annual report including audited consolidated financial statements on Form 20-F for the year ended December 31, 2023 with the U.S. Securities and Exchange Commission. The report is available at KEPCO's website, home.kepco.co.kr/kepco/EN/ (Investor Relations – IR Information – U.S. Filing), as well as the U.S. Securities and Exchange Commission website, www.sec.gov. Investors m ...

Fuel Costs and Pricing - In 2023, fuel costs constituted 30.1% of the company's cost of sales, with the ratio of fuel costs to sales at 30.8%[36] - The average weekly spot price of Newcastle coal decreased from US$179.13 per ton in 2022 to US$106.38 per ton in 2023, and further to US$89.36 per ton as of April 5, 2024[36] - The average daily spot price of Dubai crude oil decreased from US$97.03 per barrel in 2022 to US$81.93 per barrel in 2023, and increased to US$91.71 per barrel as of April 5, 2024[36] - The maximum adjustment to the Fuel Cost Adjusted Charge is limited to Won ±5 per kilowatt-hour from the Base Fuel Cost[41] - The company increased the Usage Charge by Won 11.4 and Won 8.0 per kilowatt-hour in January and May 2023 respectively, to reflect a portion of the increase in the Base Fuel Cost[46] Financial Performance - In 2023, the company incurred operating and net losses of Won 4,245 billion and Won 4,716 billion respectively due to rising fuel prices among other reasons[47] - In 2023, the company reported sales of Won 87,476 billion and a net loss of Won 4,716 billion, compared to sales of Won 70,546 billion and a net loss of Won 24,429 billion in 2022[170] - The company experienced net losses for the last three years due to significant increases in global energy prices and power purchase costs, leading to higher debt issuance to meet working capital needs[79] Government Policies and Regulations - The government announced plans to gradually increase the tariff to address the company's cumulative deficit by 2026, but there is no assurance that these plans will be realized[46] - The government plans to freeze utility rates, including the tariff, during the first half of 2024[46] - The Government's new tariff structure, effective January 1, 2017, changed from a six-tiered to a three-tiered system, reducing the highest rate to no more than three times the lowest rate[52] - The government may adopt policy measures affecting tariff rates, which could financially burden the company[52] - The government has suspended plans to privatize one of the non-nuclear generation subsidiaries due to market conditions[49] Energy Generation and Capacity - The Tenth Basic Plan aims to increase nuclear generation capacities from 26.1 gigawatts in 2023 to 31.7 gigawatts by 2036, while reducing coal generation capacities from 40.2 gigawatts to 27.1 gigawatts during the same period[55] - Domestic renewable energy generation capacity is projected to expand from 32.8 gigawatts in 2023 to 108.3 gigawatts by 2036[55] - The total coal-fired power plant capacity is projected to decrease from 40.2 gigawatts in 2023 to 27.1 gigawatts by 2036, reducing its share of total power generation capacity from 27.1% to 11.3%[67] - The company owns approximately 57.6% of the total electricity generation capacity in Korea, indicating a significant market position that may be threatened by new entrants[91] - The total installed generation capacity of the company and its subsidiaries is 83,235 megawatts, comprising 794 generation units[226] Environmental and Carbon Neutrality Initiatives - The company plans to contribute to achieving carbon neutrality by 2050 through power grid innovation and enhancing grid stability[172] - The company aims to expand clean energy supply and improve demand-side energy efficiency by collaborating with subsidiaries and independent power producers[177] - The company intends to transform its overseas business portfolio to focus on eco-friendly projects and end overseas coal-fired generation projects[177] - The company plans to secure core technologies necessary for achieving carbon neutrality through aggressive R&D investment[177] - The national target emission level for 2030 is set at 436.6 million tons, representing a 40% reduction compared to 2018 levels[66] Risks and Challenges - The company is exposed to risks related to ongoing sanctions, which may necessitate terminating relationships with Russian suppliers and finding alternative sources[136] - Unfavorable financial conditions in Korea and globally could adversely affect the company's business and financial condition, particularly due to dependence on Korean consumer demand for electricity[137] - Ongoing inflation and geopolitical conflicts may negatively impact the Korean economy, affecting the company's profitability[139] - The operation of nuclear power generation facilities involves numerous hazards, which could result in material losses or increased expenses[101] - Cybersecurity risks are increasing, with potential impacts on electricity availability and operational reliability due to sophisticated attacks[1] Corporate Governance and Ownership - As of December 31, 2023, the government owned 51.1% of the company's issued capital stock, which may complicate future equity financing without government participation[1] - The Korean government maintains a 51.1% ownership stake in the company, which influences corporate matters including dividend approvals[164][165] - Foreign investment in the company is subject to a 40% ceiling, with a 3% limit on individual foreign investors, which may restrict ownership[151][152] Labor and Employment - Approximately 74.1% of the company's employees were members of labor unions as of December 31, 2023[97] - The government has pledged to transition non-permanent workers to permanent positions, which may increase costs for the company[98] Strategic Initiatives - The company plans to maintain a controlling stake in its five non-nuclear generation subsidiaries despite considering minority share sales[50] - The company is actively pursuing overseas expansion opportunities, particularly in renewable energy, which may involve different risks compared to domestic operations[87] - The company is working to improve its risk monitoring and management system to prevent incidents similar to past occurrences[1]

Board Composition and Governance - Mr. Kang, Hoon was appointed as a non-standing director of Korea Electric Power Corporation (KEPCO) for a term of two years starting May 1, 2024[2]. - The board of directors now includes 14 members, with 6 standing directors and 8 non-standing directors[8]. - The current President & CEO, Kim, Dong-Cheol, has held the position since September 19, 2023[8]. - The new non-standing director, Kang, Hoon, has a background as an attorney and has held various legal positions, including Judge of Seoul High Court[4]. - The board composition reflects a diverse range of expertise, including finance, safety, and global business management[8]. - The appointment of Kang, Hoon replaces the former non-standing director, Ms. Kim, Jae-Shin, whose term expired[2]. - The board includes members with specific roles in audit and ESG committees, enhancing governance and sustainability focus[8]. - KEPCO's governance structure aims to strengthen oversight and strategic planning through its diverse board[8]. - The appointment of new directors is part of KEPCO's strategy to enhance its operational effectiveness and corporate governance[2]. - The company continues to adapt its leadership to align with evolving market and regulatory demands[2].