KT sees annual profit decline for first time
According to its regulatory filing, KT recorded an operating loss of 291.8 billion won ($266 million) last year over 2013, and posted revenue of 23.4 trillion won for the year, a 1.6 percent decrease over 2013.
The company’s operating profit in the fourth quarter was 34.1 billion won, down 89 percent over the third quarter.
The early profit plunge was partially due to the company’s payout of 1 trillion won in early retirement fees to 3,800 employees in April, the telecom said Friday.
The fourth quarter was the worst for KT, as the company struggled to deal with the effects of the Mobile Device Distribution Improvement Act that took effect in October.
The company’s operating profit fell 89.8 percent in the fourth quarter, to 34 billion won.
KT’s revenue rose in mobile telecommunications, media content and financing businesses, but revenue in its landline business dropped 7.2 percent year-on-year to post 5.5 trillion won.
KT said it hopes to see its profit and revenue recover this year after its internal reorganization because it will be spending less on personnel costs.
Despite the new mobile law, KT’s annual revenue in its mobile division increased 4.8 percent year-on-year to post 7.3 trillion won as it gained 10.8 million new LTE subscribers.
KT had the worst annual performance among all three major telecoms.
SK Telecom’s revenue increased 3.4 percent year-on-year to post 17.1 trillion won, while LG U+ saw its revenue rise 6.3 percent to 576.3 billion won.
“This year, the Mobile Device Distribution Improvement Act will settle down in the market, which will push us to generate revenue from a wider variety of services [not simply from monthly mobile plan sales],” said KT CFO Shin Gwang-seok.
“We hope to do this by strengthening our superfast GiGA Wi-Fi service.
BY KIM JI-YOON [firstname.lastname@example.org]
More in Industry
Doing the robot
Export growth of 6% seen by KITA next year
Big companies, fearing the worst, scramble for cash
Hyundai unveils one-size-fits-all electric vehicle module