Core Insights - The article emphasizes the focus on value investing in Asia, particularly in Hong Kong, targeting stocks with significant discrepancies between market price and intrinsic value [1] - It highlights two main categories of investment opportunities: deep value balance sheet bargains and wide moat stocks, which are characterized by their strong competitive advantages [1] Group 1: Investment Strategy - The service aims to identify deep value stocks, such as net cash stocks and low price-to-book (P/B) ratio stocks, which are available at a discount [1] - It also seeks wide moat stocks, which are high-quality businesses with sustainable competitive advantages, often referred to as "Magic Formula" stocks [1] - Monthly updates and watch lists are provided to keep investors informed about potential investment opportunities [1]

Financial Data and Key Metrics Changes - Operating revenue increased by 6.9% year-on-year, reaching KRW 28,244.2 billion [25] - Operating profit surged by 205% year-on-year to KRW 2,469.1 billion, driven by core business performance and one-off gains from real estate projects [25] - Net income rose by 340.4% year-on-year to KRW 1,836.8 billion, while EBITDA increased by 35.5% year-on-year to KRW 6,349.3 billion [27] - Operating expenses remained flat year-on-year at KRW 25,775.1 billion, attributed to lower labor costs and efficient spending [29] - Debt-to-equity ratio at the end of 2025 was 120.7%, with net debt-to-equity ratio decreasing by 0.4 percentage points year-on-year to 37.4% [31] Business Line Data and Key Metrics Changes - Wireless revenue grew by 2.8% year-on-year to KRW 7,155.4 billion, driven by subscriber expansion in 5G, with 5G penetration at 81.8% by the end of 2025 [35] - Broadband revenue increased by 1.9% year-on-year to KRW 2,533.5 billion, supported by GiGA subscriber growth [37] - Media business revenue rose by 1.7% year-on-year, driven by higher IPTV subscriber additions [37] - B2B service revenue grew by 1.3% year-on-year, with AI and IT business growing by 3.1% year-on-year [41] - KT Cloud revenue surged by 27.4% year-on-year to KRW 997.5 billion, reflecting increased data center usage and AI cloud demand [43] Market Data and Key Metrics Changes - The company reported a flat revenue for content subsidiaries year-on-year, despite the divestment of PlayD, due to growth from StudioGenie, Nasmedia, and Millie's Library [41] - KT Estate revenue increased by 15.9% year-on-year to KRW 719.3 billion, driven by strong hotel business and new property developments [43] Company Strategy and Development Direction - The company is focusing on enhancing its fundamentals and regaining customer trust following a data breach incident, with a commitment to cybersecurity improvements [3][12] - Plans include a KRW 250 billion share buyback and cancellation as part of the Corporate Value Enhancement Plan [7][21] - The company aims to solidify its leadership in the AI cloud market with the launch of new products and partnerships with global tech companies [4] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving better performance in 2026 compared to 2025, despite the financial impact of customer compensation related to the data breach [57][61] - The new CEO is expected to maintain the company's shareholder return policy and growth strategy, with a focus on AX-driven innovation [69][70] Other Important Information - The year-end dividend for 2025 is set at KRW 2,400 per share, a 20% increase from 2024 [6] - The company is investing around KRW 1 trillion in security over five years to enhance its information security system [19] Q&A Session Summary Question: What is the financial impact of the customer compensation package regarding the data breach incident? - The estimated benefit for customers is about KRW 450 billion, but not all will be booked as costs, depending on usage [57] Question: Will the new CEO maintain the previous shareholder return stance? - The DPS has been increased by 20% for 2025, and future plans will be finalized by the new CEO and the Board of Directors [65][66] Question: What is the outlook for the wireless business growth following the data breach incident? - Approximately 230,000 subscribers left during the cancellation fee waiver period, but net additions were still positive [79] Question: Why is B2B growth slower compared to peers, and what is the outlook? - B2B growth is influenced by various segments, and when combined with KT Cloud, the growth rate is 6% year-on-year, with KT Cloud showing a 27.4% increase [85][87]

Financial Performance - Operating revenue increased by 6.9% year-on-year, reaching KRW 28,244.2 billion [22] - Operating profit surged by 205% year-on-year to KRW 2,469.1 billion, driven by core business performance and one-off gains from real estate projects [22] - Net income rose by 340.4% year-on-year to KRW 1,836.8 billion, with EBITDA increasing by 35.5% to KRW 6,349.3 billion [24][22] - Operating expenses remained flat year-on-year at KRW 25,775.1 billion, attributed to lower labor costs and efficient spending [26] Business Line Performance - Wireless revenue grew by 2.8% year-on-year to KRW 7,155.4 billion, supported by subscriber expansion in 5G, which reached a penetration rate of 81.8% [32] - Broadband revenue increased by 1.9% year-on-year to KRW 2,533.5 billion, driven by growth in giga subscribers and value-added services [34] - B2B service revenue rose by 1.3% year-on-year, with AI and IT business growing by 3.1% [39] - KT Cloud revenue saw a significant increase of 27.4% year-on-year, reaching KRW 997.5 billion, due to rising data center usage and AI cloud demand [41] Market Data - The company reported a debt-to-equity ratio of 120.7% at the end of 2025, with a net debt-to-equity ratio decreasing by 0.4 percentage points to 37.4% [28] Company Strategy and Industry Competition - The company is focusing on enhancing its fundamentals and rebuilding customer trust following a data breach incident, with a commitment to invest around KRW 1 trillion in security over five years [16][14] - The new CEO, expected to take office in 2026, is anticipated to maintain the company's growth strategy and shareholder return policy [66][62] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving better performance in 2026 compared to 2025, despite the financial impact of the customer compensation package related to the data breach [59][55] - The company aims to improve operational efficiency in the wireless business and expects continued growth in the B2B sector, particularly in AI and IT [80][82] Other Important Information - The company announced a 20% increase in annual dividends per share from KRW 2,000 in 2024 to KRW 2,400 in 2025, alongside a KRW 250 billion share buyback plan [6][18] - The appointment of a new CEO was confirmed, who is known for expertise in B2B and future technologies [9] Q&A Session Summary Question: What is the financial impact of the customer compensation package regarding the data breach incident? - The estimated benefit for customers is around KRW 450 billion, but not all will be booked as costs, depending on customer usage [55] Question: Will the new CEO maintain the previous shareholder return stance? - The dividend per share has been increased by 20%, and the new CEO and Board of Directors will finalize the shareholder return plan for 2026 [62][64] Question: What is the outlook for the wireless business following the data breach? - Approximately 230,000 subscribers left during the cancellation fee waiver period, but the overall impact was mitigated by previous net additions [77] Question: Why is B2B growth slower compared to peers? - When including KT Cloud revenue, the overall B2B growth is 6%, which is not considered low given the market size [84]

Financial Data and Key Metrics Changes - Operating revenue increased by 6.9% year-on-year, reaching KRW 28,244.2 billion [26] - Operating profit surged by 205% year-on-year to KRW 2,469.1 billion, driven by core business performance and one-off gains [26] - Net income rose by 340.4% year-on-year to KRW 1,836.8 billion, with EBITDA increasing by 35.5% to KRW 6,349.3 billion [28] - Operating expenses remained flat year-on-year at KRW 25,775.1 billion due to lower labor costs and efficient spending [30] - Debt-to-equity ratio at the end of 2025 was 120.7%, with net debt-to-equity ratio decreasing to 37.4% [32] Business Line Data and Key Metrics Changes - Wireless revenue grew by 2.8% year-on-year to KRW 7,155.4 billion, supported by subscriber expansion in 5G, which reached a penetration rate of 81.8% [36] - Broadband revenue increased by 1.9% year-on-year to KRW 2,533.5 billion, driven by growth in giga subscribers and value-added services [38] - Media business revenue rose by 1.7% year-on-year, attributed to higher IPTV subscriber additions [38] - B2B service revenue grew by 1.3% year-on-year, with AI and IT business growing by 3.1% [42] - KT Cloud revenue increased by 27.4% year-on-year to KRW 997.5 billion, reflecting strong demand for data center services [44] Market Data and Key Metrics Changes - The company is focusing on enhancing its market position in the AI and IT sectors, with significant investments planned for security and infrastructure [19][48] - The overall B2B market growth is projected to be stable, with KT Cloud's growth expected to continue at a high rate [86] Company Strategy and Development Direction - The company aims to solidify its fundamentals and regain customer trust following a data breach incident, with a focus on cybersecurity and network resilience [3][13] - KT plans to implement a corporate value enhancement plan, including a KRW 250 billion share buyback and increased dividends [6][22] - The new CEO is expected to maintain the company's growth strategy while potentially introducing tactical changes reflecting his philosophy [69] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving better performance in 2026 compared to 2025, despite challenges from the data breach [61] - The company is committed to improving operational efficiency in the wireless business and expects stable growth in B2B services [80][83] Other Important Information - The company has set a year-end dividend of KRW 2,400 per share, a 20% increase from the previous year [6] - A new CEO has been appointed, expected to bring expertise in B2B and future technologies [11] Q&A Session Summary Question: Financial impact of customer compensation package and future shareholder return stance - The financial impact of the customer appreciation package is estimated at KRW 450 billion, but not all will be booked as costs [56] - The company plans to maintain a progressive shareholder return policy, with the new CEO and board finalizing future plans [65][67] Question: Outlook for wireless business growth and B2B performance - Approximately 230,000 subscribers left during the cancellation fee waiver period, but net additions were still positive [78] - B2B growth is slower compared to peers, but combined revenue growth, including KT Cloud, shows a 6% increase year-on-year [85][86]

Disclaimer This presentation has been prepared by KT Corp.(the "Company") in accordance with K-IFRS. This presentation contains forward-looking statements, which are subject to risks, uncertainties, and assumptions. This presentation is being presented solely for your information and is subject to change without notice. No presentation or warranty, expressed or implied, is made and no reliance should be placed on the accuracy, actuality, fairness, or completeness of the information presented. The Company ha ...

Core Insights - NAN FUNG TRINITY (HK) LTD has initiated a new position in KT Corporation by acquiring 1,492,440 shares valued at approximately $28.31 million as of February 3, 2026 [2][10] - KT Corporation's stock price was $20.90, reflecting a 20.1% increase over the past year, outperforming the S&P 500 by 4.73 percentage points [8] Company Overview - KT Corporation is a leading telecommunications provider in South Korea, serving millions of mobile and IPTV subscribers [6] - The company has a market capitalization of $10.12 billion and generates revenue primarily from subscription-based telecom services, media content delivery, and IT solutions [4][9] - KT's revenue for the trailing twelve months (TTM) is $19.20 billion, with a net income of $698.29 million [4] Investment Implications - The acquisition of KT represents 2.24% of NAN FUNG TRINITY's 13F reportable assets, making it the 11th largest position in the fund [8][10] - Other top holdings in the fund include EWY, EWZ, AMZN, AMCR, and NVDA, indicating a focus on technology and telecommunications sectors [8][10]

Core Insights - The article emphasizes the importance of looking beyond U.S. large caps for investment opportunities, particularly in undervalued international stocks [1][3][9] - The Benzinga Value Ranking is introduced as a systematic, numbers-driven tool to identify the cheapest stocks globally based on multiple valuation metrics [2][5] Investment Strategy - Investors are encouraged to focus on the top decile of the Benzinga Value Ranking, specifically targeting non-U.S. stocks to access the cheapest part of the global market [7][9] - The current market environment is characterized by extreme valuation dispersion outside the U.S., with many profitable companies trading at low earnings multiples [4][6] Company Highlights - **POSCO Holdings (NYSE:PKX)**: A leading steel producer in South Korea, trading at discounted multiples despite controlling high-quality assets [11] - **Sasol Ltd. (NYSE:SSL)**: An integrated energy and chemicals company in South Africa, generating substantial cash flow but heavily discounted due to past operational issues [12] - **Korea Electric Power Corp. (NYSE:KEP)**: The backbone of South Korea's power system, facing extreme low valuation multiples due to government pricing controls [13] - **LuxExperience (NYSE:LUXE)**: A niche luxury travel company in the Netherlands, undervalued due to lack of investor attention rather than demand collapse [14] - **Gerdau (NYSE:GGB)**: Brazil's largest long steel producer, trading at low multiples despite consistent cash flow generation [15] - **Honda Motor (NYSE:HMC)**: A global manufacturing leader in Japan, undervalued due to lack of hype around its steady profits and cash flow [16] - **SK Telecom (NYSE:SKM)**: South Korea's largest wireless carrier, undervalued due to low growth expectations despite reliable cash generation [18] - **Jiayin Group (NASDAQ:JFIN)**: A Chinese fintech company facing regulatory uncertainty, leading to extreme valuation discounts [19] - **FinVolution Group (NYSE:FINV)**: Another Chinese fintech platform, similarly undervalued due to regulatory challenges and investor distrust [20] - **KT Corp. (NYSE:KT)**: A leading telecommunications provider in South Korea, generating stable cash flow but facing compressed valuation multiples [21]

Company Overview - KT Corporation is a leading telecommunications provider in South Korea, offering a diversified service portfolio that includes fixed-line, wireless, broadband, and digital media platforms [5] - The company generates revenue primarily through subscription-based telecom services, data communications, media content delivery, and value-added IT services, serving individual consumers, businesses, and institutional clients [7] Financial Performance - As of the latest report, KT's stock price is $18.97, with a market capitalization of $9.15 billion and a revenue of $18.99 billion for the trailing twelve months (TTM) [4] - The net income for KT in the TTM is approximately $672.99 million [4] - In the third quarter, revenue increased by 7.1% year-over-year, driven by telecom growth, cloud and data center demand, and real estate development gains [8] - Wireless service revenue grew nearly 5%, with 5G penetration reaching 80.7%, while EBITDA remained solid despite a margin decline of about 400 basis points to 21.1% [8] Market Position and Trends - KT's stock has outperformed the S&P 500 over the past year, with a 21.5% increase compared to the S&P 500's 16% gain [3] - The company's competitive advantage lies in its integrated service offerings and strong market presence in South Korea's communications sector [5] - Despite operational improvements, KT's appeal as a steady, dividend-oriented telecom may have diminished in comparison to higher-volatility or higher-upside investments favored by some funds [9]

Core Insights - The article expresses a pessimistic view on KT Corporation, highlighting that the stock's rise is based on the perception of telecom stocks as a safe investment despite disappointing results in fiscal year 2024 [1] Company Analysis - KT Corporation's stock performance is being influenced by a broader trend where telecom stocks are seen as a flight to safety, which may not reflect the company's underlying financial health [1] Industry Context - The telecom industry is experiencing a shift where investors are gravitating towards perceived safe havens, but this may not be sustainable given the disappointing fiscal results reported by companies like KT Corporation [1]

Group 1 - The article focuses on the Asia Value & Moat Stocks research service, which targets value investors looking for Asia-listed stocks with significant discrepancies between price and intrinsic value [1] - The service emphasizes deep value balance sheet bargains, such as net cash stocks and low price-to-book (P/B) stocks, as well as wide moat stocks that represent high-quality businesses [1] - The author has over a decade of experience in the Asian equity market and provides monthly updates and watch lists for potential investment opportunities, particularly in the Hong Kong market [1]