LG Telecom 1Q profit up on subscriber growth

Mobile service provider LG Telecom Inc. saw net profits more than quadruple in the first quarter compared to the same period last year due to an increase in subscribers. The smallest of the three mobile service operators reported yesterday that in the first quarter, sales and operating profit were up 14.3 percent and 131.5 percent, respectively, to 942.9 billion won ($994.6 million) and 106.3 billion won. Net profit grew 322 percent year-on-year to 105.4 billion won. Sales of data services posted 19 percent growth year-on-year to 132.5 billion won. The company said that an increase in customers helped its performance. According to the most recent figures released by the Information and Communications Ministry, LG Telecom had a 17.1 percent share of the local mobile service market in terms of subscribers, with 6.6 million subscribers as of late March; at the end of last year, the mobile operator only had about six million subscribers. On a quarterly basis, however, LG Telecom’s operating profits were down by 11.2 percent, mainly due to increased marketing costs. Since the government allowed mobile phone operators to subsidize new handset purchases by long-term subscribers, service providers have been aggressively competing to offer subsidies on new handsets. In the case of LG Telecom, marketing costs were up 16.6 percent in the first quarter compared with the previous quarter. LG Telecom shares went up 5.3 percent and closed at 10,450 won yesterday. by Wohn Dong-hee