Profits of LG U+ soar 327% on LTE
LG U+ announced yesterday its 2013 performance figures, which included a 5 percent year-on-year increase in revenue to 11.4503 trillion won and a turnaround in net profit to 279.5 billion won.
Its 19.9 percent share of the wireless market led to its improvement in earnings, the company explained.
Driven by a rise in its number of LTE subscribers and the average revenue per user, its wireless business performance increased 19.8 percent from a year earlier to 4.76 trillion won.
LTE subscribers of LG U+ were around 43.8 million people at the end of 2012, accounting for 43.1 percent of the LTE market. That increased to 7.08 million last year, or 62.5 percent of the domestic LTE subscribers.
The results for the nation’s three mobile carriers varied greatly, with KT announcing the worst earnings performance. SK Telecom, the No. 1 in the industry, increased its net income by 44 percent. When comparing operating profit, SK Telecom posted 2.11 trillion won for 2013, up 16.2 percent from a year earlier. KT saw 874 billion won, down 27.7 percent during the same period, and LG U+ posted 542.1 billion won, up 327.7 percent from 2012.
“A sluggish earnings performance from LG U+ in 2012 contributed to the large growth rate in earnings for the last year,” said an industry insider.
The company’s operating profit in 2011 was 277.8 billion won, which declined 54 percent in 2012 after the company spent heavily on marketing and investing in the LTE service to attract new subscribers.
“We will continue the growth based on the differentiated product competitiveness in the home market as well as by leading the LTE market with the 3 band carrier aggregation technology and the expansion of LTE broadband network service nationwide,” said Kim Young-sup, senior vice president and the head of business management of LG U+.
“We will do our best for shared growth of the company and its shareholders through improved profits and accomplishing the management’s goals in 2014,” he said.
The company’s shares closed at 10,950 won yesterday, up 4.29 percent, or 450 won, from the previous day.
By kim jung-yoon [firstname.lastname@example.org]