KT(US:KT)2021-08-10 21:10Financial Data and Key Metrics Changes - Consolidated revenue increased by 2.6% year-on-year to KRW6,027.6 billion, while operating profit rose by 38.5% year-on-year to KRW475.8 billion [7][22] - Net profit surged by 77.4% year-on-year to KRW370.8 billion, and EBITDA increased by 9.4% year-on-year to KRW1,373.2 billion [22] - Operating expenses rose by 0.3% year-on-year to KRW5,551.8 billion due to increased labor costs and selling expenses [22][23] Business Line Data and Key Metrics Changes - Wireless revenue grew by 3.8% year-on-year to KRW1,788.5 billion, with wireless service revenue up by 4.5% year-on-year to KRW1,688.5 billion, driven by 5G subscriber growth [24] - Fixed line revenue decreased by 1.6% year-on-year to KRW370.5 billion, while broadband Internet revenue increased by 2.1% year-on-year to KRW507.4 billion [25] - B2B revenue declined by 0.8% year-on-year to KRW691.3 billion, but excluding certain declines, it recorded a growth of 3.2% year-on-year [26] Market Data and Key Metrics Changes - The number of wireless subscribers reached 22,620,000, with 5G subscribers accounting for 35% of handset subscribers [24] - Corporate fixed line revenue increased by 4.2% year-on-year, supported by demand for digital transformation [27] - AI and DX business revenue grew by 6.2% year-on-year, reflecting strong performance in IDC and AI contact centers [27] Company Strategy and Development Direction - The company is transitioning from a traditional telecom to a Digico, focusing on digital platform growth and new business areas such as AI robotics and digital healthcare [29][31] - KBank is considering an IPO in 2023, aiming to enhance its financial platform capabilities and customer base [32] - The media content business is undergoing structural realignment to enhance synergies and drive original content production [20] Management Comments on Operating Environment and Future Outlook - Management expects the growth trend to continue into the second half of the year, with service revenue guidance above 4% [36][37] - Profit growth in the second half may be lower due to increased expenses and business restructuring [38][39] - The company aims to maintain revenue growth while being conservative about profit expectations for the second half [40] Other Important Information - CapEx for Q2 2021 was KRW574.7 billion, with a total of KRW864.1 billion for the first half [23] - The debt-to-equity ratio improved to 117.9%, down 7 percentage points year-on-year [23] Q&A Session Summary Question: Outlook for the second half of the year and ARPU growth - Management forecasts continued growth in service revenue and expects ARPU to increase due to new 5G handset launches [36][41] Question: KBank's strategic direction - KBank plans to enhance customer retention through unique product offerings and leverage its online banking efficiency [43][44][46] Question: Group affiliates' earnings and CapEx stability - All group affiliates contributed positively to earnings, with BC Card showing significant growth [50][52] - CapEx is expected to be stable, with a higher spend anticipated in the second half of the year [55][56] Question: Implications of moving to stand-alone 5G - Transitioning to stand-alone 5G will reduce latency and operational costs, enabling advanced services like network slicing [60][62] Question: Dividend policy - The company maintains a dividend policy of 50% based on adjusted net profit, aiming to improve shareholder value [63]