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KT CORP — Regulatory Filings 2008
Apr 25, 2008
30640_ffr_2008-04-25_592ad4b4-bf4f-406b-a057-d290979c2587.zip
Regulatory Filings
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6-K 1 d6k.htm FORM 6-K Form 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of April 2008
Commission File Number 1-14926
KT Corporation
(Translation of registrants name into English)
206 Jungja-dong
Bundang-gu, Sungnam
Kyunggi-do
463-711
Korea
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F Ö Form 40-F
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No Ö
If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Dated: April 25, 2008 | |
|---|---|
| KT Corporation | |
| By: | /s/ Thomas Bum Joon Kim |
| Name: | Thomas Bum Joon Kim |
| Title: | Managing Director |
| By: | /s/ Youngwoo Kim |
| Name: | Youngwoo Kim |
| Title: | Director |
April 25, 2008
1st Quarter 2008
Preliminary Earnings Commentary
(KRX : 030200 / NYSE : KTC)
Disclaimer
This material contains estimated information of unaudited non-consolidated preliminary financial and operating data of KT Corporation (KT or the company) for year 2008 first quarter and forward-looking statements with respect to the financial condition, results of operations and business of KT. Statements that are not historical facts, including statements about KTs beliefs and expectations, are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other future results or performance expressed or implied by such forward-looking statements. Such forward-looking statements were based on current plans, estimates and perfections of KT and the political and economic environment in which KT will operate in the future and therefore you should not place undue reliance on them.
Therefore, KT does not make any representation or warranty, expressed or implied, as to the accuracy or completeness of the unaudited financial and operating data contained in this material and such information maybe materially different from the actual results or performance of KT. KT speaks only as of the date it is made, and KT undertakes no obligation to update publicly any of them in light of new information or future events.
The financial and operating data contained in this presentation have been rounded. Since affiliated companies have not finished accounting, estimated figures were used for the equity method gains/losses.
KTs non-consolidated financial statements and report for 2008 1st quarter will be filed with the Financial Supervisory Service(FSS) and the Korea Exchange (KRX) in May 15, 2008.
If you have any questions in connection with the preliminary earnings, please contact Investor Relations Department of KT.
Tel : 82-31-727-0950~59
Fax : 82-31-727-0949
E-mail: [email protected]
Note :
As of February 22, 2008, following amendments of the Korean accounting standards Art.15(equity method), we have retroactively applied goodwill and equity method capital adjustments resulting from additional stake acquisition of subsidiaries on capital surplus. Details are as follow:
-
Reversion of past amortization : 1) Retained earnings was increased, which was previously decreased due to amortization of goodwill and 2) capital surplus was increased
-
Exclusion of unamortized amount : Capital surplus and investment securities
1
1. Financial Highlights
A. Summary of Income Statement
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| OPERATING REVENUES | 2,967.0 | 2,996.3 | -29.3 | -1.0 % | 2,972.4 | -5.4 | -0.2 % | 2,967.0 |
| ¨ Internet access | 528.1 | 533.2 | -5.0 | -0.9 % | 526.1 | 2.0 | 0.4 % | 528.1 |
| ¨ Internet application | 106.9 | 95.3 | 11.6 | 12.2 % | 91.3 | 15.7 | 17.2 % | 106.9 |
| ¨ Data | 402.4 | 408.3 | -5.9 | -1.4 % | 406.9 | -4.5 | -1.1 % | 402.4 |
| ¨ Telephone | 1,023.2 | 1,064.4 | -41.3 | -3.9 % | 1,056.5 | -33.3 | -3.2 % | 1,023.2 |
| ¨ LM | 364.1 | 392.1 | -28.0 | -7.1 % | 411.9 | -47.8 | -11.6 % | 364.1 |
| ¨ Wireless | 419.9 | 368.2 | 51.7 | 14.0 % | 380.4 | 39.5 | 10.4 % | 419.9 |
| ¨ Real estate | 58.7 | 50.3 | 8.4 | 16.7 % | 45.9 | 12.9 | 28.0 % | 58.7 |
| ¨ Others | 63.6 | 84.5 | -20.9 | -24.8 % | 53.4 | 10.2 | 19.1 % | 63.6 |
| SI | 52.1 | 70.7 | -18.6 | -26.3 % | 44.6 | 7.5 | 16.9 % | 52.1 |
| OPERATING EXPENSES | 2,634.0 | 2,812.6 | -178.6 | -6.4 % | 2,443.2 | 190.7 | 7.8 % | 2,634.0 |
| ¨ Labor | 683.3 | 648.3 | 35.0 | 5.4 % | 653.2 | 30.1 | 4.6 % | 683.3 |
| ¨ Commissions | 170.9 | 196.0 | -25.2 | -12.8 % | 153.0 | 17.9 | 11.7 % | 170.9 |
| ¨ Sales commission | 230.1 | 181.5 | 48.6 | 26.8 % | 141.0 | 89.1 | 63.2 % | 230.1 |
| ¨ Sales promotion | 79.3 | 58.0 | 21.3 | 36.7 % | 50.2 | 29.1 | 58.0 % | 79.3 |
| ¨ Advertising | 16.9 | 42.2 | -25.2 | -59.8 % | 20.6 | -3.6 | -17.6 % | 16.9 |
| ¨ Provision for doubtful accounts | 6.9 | 12.8 | -6.0 | -46.6 % | 20.2 | -13.4 | -66.1 % | 6.9 |
| ¨ Depreciation | 482.3 | 623.5 | -141.1 | -22.6 % | 477.3 | 5.0 | 1.0 % | 482.3 |
| ¨ Repairs & maintenance | 22.0 | 69.9 | -47.9 | -68.5 % | 25.6 | -3.5 | -13.9 % | 22.0 |
| ¨ Cost of goods sold | 157.3 | 142.4 | 14.8 | 10.4 % | 182.3 | -25.1 | -13.7 % | 157.3 |
| ¨ Cost of service provided | 476.8 | 508.7 | -31.9 | -6.3 % | 442.9 | 33.9 | 7.7 % | 476.8 |
| ¨ R&D | 56.8 | 88.9 | -32.1 | -36.1 % | 53.8 | 3.0 | 5.6 % | 56.8 |
| ¨ Activation/installation and A/S cost | 96.5 | 92.8 | 3.7 | 0.0 | 75.8 | 20.7 | 0.3 | 96.5 |
| ¨ Others | 154.9 | 147.5 | 7.3 | 5.0 % | 147.4 | 7.5 | 5.1 % | 154.9 |
| OPERATING INCOME | 333.0 | 183.8 | 149.3 | 81.2 % | 529.1 | -196.1 | -37.1 % | 333.0 |
| Operating margin | 11.2 % | 6.1 % | 5.1% P | 17.8 % | -6.6% P | 11.2 % | ||
| EBITDA(1) | 815.4 | 807.2 | 8.1 | 1.0 % | 1,006.5 | -191.1 | -19.0 % | 815.4 |
| EBITDA margin | 27.5 % | 26.9 % | 0.5% P | 33.9 % | -6.4% P | 27.5 % | ||
| Non-operating income | 134.3 | 77.9 | 56.4 | 72.4 % | 146.6 | -12.2 | -8.3 % | 134.3 |
| Non-operating expenses | 269.6 | 178.1 | 91.6 | 51.4 % | 144.2 | 125.4 | 87.0 % | 269.6 |
| INCOME BEFORE INCOME TAXES | 197.8 | 83.6 | 114.1 | 136.5 % | 531.5 | -333.7 | -62.8 % | 197.8 |
| Income tax expenses | 43.7 | -21.2 | 64.9 | N/A | 144.2 | -100.5 | -69.7 % | 43.7 |
| Effective tax rate | 22.1 % | -25.4 % | N/A | 27.1 % | -5.0% P | 22.1 % | ||
| NET INCOME | 154.1 | 104.9 | 49.2 | 46.9 % | 387.3 | -233.2 | -60.2 % | 154.1 |
| EPS(2) (won) | 756 | 1,070 | -314 | -29.3 % | 1,528 | -772 | -50.5 % | 756 |
(1) EBITDA = Operating income + depreciation
(2) EPS = Net income ÷ Weighted average of no. of shares outstanding
Revenue
- YoY and QoQ decrease was due to decline in telephone and LM revenue.
Operating Income
-
Rise in labor, commissions, sales promotion and other costs led to a YoY decrease in operating income.
-
QoQ increase mainly due to decline in depreciation and repairs and maintenance.
2
B. Summary of Balance Sheet
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | ||
|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | ||||
| TOTAL ASSETS | 17,596.1 | 17,917.2 | -321.1 | -1.8 % | 17,746.1 | -150.0 | -0.8 % |
| ¨ Current assets | 3,058.7 | 3,310.4 | -251.7 | -7.6 % | 3,311.0 | -252.3 | -7.6 % |
| Quick assets | 2,953.5 | 3,188.3 | -234.8 | -7.4 % | 3,205.3 | -251.8 | -7.9 % |
| - Cash & Cash equivalents | 884.5 | 1,229.2 | -344.7 | -28.0 % | 1,358.8 | -474.2 | -34.9 % |
| Inventories | 105.2 | 122.1 | -16.9 | -13.8 % | 105.7 | -0.5 | -0.5 % |
| ¨ Non-current assets | 14,537.4 | 14,606.8 | -69.4 | -0.5 % | 14,435.0 | 102.4 | 0.7 % |
| Investments and other non-current assets | 3,753.8 | 3,718.4 | 35.4 | 1.0 % | 3,776.5 | -22.7 | -0.6 % |
| - KTF shares | 2,595.4 | 2,620.2 | -24.8 | -0.9 % | 2,700.0 | -104.6 | -3.9 % |
| - Long-term loans | 39.8 | 66.3 | -26.4 | -39.9 % | 154.5 | -114.7 | -74.2 % |
| - Others | 1,118.5 | 1,032.0 | 86.6 | 8.4 % | 922.0 | 196.6 | 21.3 % |
| Tangible assets | 10,371.0 | 10,448.6 | -77.7 | -0.7 % | 10,205.8 | 165.2 | 1.6 % |
| Intangible assets | 412.6 | 439.7 | -27.1 | -6.2 % | 452.8 | -40.1 | -8.9 % |
| TOTAL LIABILITIES | 8,983.8 | 9,057.3 | -73.4 | -0.8 % | 9,236.7 | -252.9 | -2.7 % |
| ¨ Current liabilities | 2,455.7 | 2,991.3 | -535.7 | -17.9 % | 3,289.3 | -833.6 | -25.3 % |
| Interest-bearing debts | 235.1 | 438.0 | -202.9 | -46.3 % | 912.2 | -677.1 | -74.2 % |
| Accounts payable | 664.0 | 769.9 | -105.8 | -13.7 % | 605.1 | 58.9 | 9.7 % |
| Others | 1,556.5 | 1,783.5 | -226.9 | -12.7 % | 1,772.0 | -215.5 | -12.2 % |
| ¨ Non-current liabilities | 6,528.2 | 6,065.9 | 462.2 | 7.6 % | 5,947.4 | 580.8 | 9.8 % |
| Interest-bearing debts | 5,104.6 | 4,643.9 | 460.7 | 9.9 % | 4,537.1 | 567.5 | 12.5 % |
| Installation deposit | 833.1 | 841.4 | -8.3 | -1.0 % | 893.9 | -60.8 | -6.8 % |
| Others | 590.5 | 580.7 | 9.8 | 1.7 % | 516.4 | 74.1 | 14.4 % |
| TOTAL STOCKHOLDERS EQUITY | 8,612.3 | 8,859.9 | -247.6 | -2.8 % | 8,509.4 | 102.9 | 1.2 % |
| ¨ Common stock | 1,561.0 | 1,561.0 | 0.0 | 0.0 % | 1,561.0 | 0.0 | 0.0 % |
| ¨ Capital surplus | 1,276.7 | 1,278.6 | -1.8 | -0.1 % | 1,440.9 | -164.2 | -11.4 % |
| ¨ Retained earnings | 9,592.2 | 9,842.9 | -250.7 | -2.5 % | 9,315.4 | 276.8 | 3.0 % |
| ¨ Capital adjustments | -3,815.8 | -3,815.8 | 0.0 | N/A | -3,816.7 | 0.9 | N/A |
| Treasury stock | -3,824.9 | -3,825.7 | 0.8 | N/A | -3,825.7 | 0.8 | N/A |
| Gain(loss) on valuation of investment securities | 10.6 | 11.4 | -0.9 | -7.6 % | 15.6 | -5.1 | -32.4 % |
| Others | -1.5 | -1.5 | 0.1 | N/A | -6.6 | 5.2 | N/A |
| ¨ Others | -1.9 | -6.8 | 4.9 | N/A | 8.8 | -10.7 | N/A |
| Total interest-bearing debt | 5,339.7 | 5,081.9 | 257.8 | 5.1 % | 5,449.3 | -109.6 | -2.0 % |
| Net debt | 4,455.2 | 3,852.7 | 602.4 | 15.6 % | 4,090.5 | 364.6 | 8.9 % |
| Net debt / Total shareholders equity | 51.7 % | 43.5 % | 8.2% P | 48.1 % | 3.7% P |
Assets
- Decrease in YoY net income resulted in a decline in cash and cash equivalents.
Liabilities
- YoY and QoQ increase in non-current liabilities due to 1) issuance of bonds and 2) loss on foreign currency bonds appraisal affected by the rise in exchange rates.
Stockholders Equity
- Capital surplus and retained earnings were adjusted following changes in accounting standards related to equity method.
3
2. Operating Results
A. Internet Revenue
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| Internet access | 528.1 | 533.2 | -5.0 | -0.9 % | 526.1 | 2.0 | 0.4 % | 528.1 |
| ¨ Broadband | 527.5 | 532.5 | -5.0 | -0.9 % | 525.8 | 1.7 | 0.3 % | 527.5 |
| Megapass | 501.1 | 506.5 | -5.4 | -1.1 % | 513.6 | -12.5 | -2.4 % | 501.1 |
| Nespot | 8.5 | 9.0 | -0.5 | -5.9 % | 11.7 | -3.2 | -27.6 % | 8.5 |
| WiBro | 17.9 | 17.0 | 0.9 | 5.5 % | 0.5 | 17.4 | 3390.8 % | 17.9 |
| ¨ Others | 0.7 | 0.7 | 0.0 | 0.8 % | 0.3 | 0.3 | 99.8 % | 0.7 |
| Internet application | 106.9 | 95.3 | 11.6 | 12.2 % | 91.3 | 15.7 | 17.2 % | 106.9 |
| ¨ IDC | 48.9 | 50.6 | -1.7 | -3.4 % | 45.4 | 3.4 | 7.6 % | 48.9 |
| ¨ Bizmeka | 36.7 | 28.0 | 8.7 | 31.2 % | 26.4 | 10.2 | 38.7 % | 36.7 |
| ¨ Mega TV | 5.0 | 1.9 | 3.1 | 1.6 | 5.6 | -0.5 | -0.1 | 5.0 |
| ¨ Others | 16.3 | 14.9 | 1.5 | 9.8 % | 13.8 | 2.5 | 18.2 % | 16.3 |
Megapass
- QoQ and YoY decrease in revenue from discounts and modem rental fee expiration for long-term customers.
Internet application
-
QoQ increase from rise in sales of MegaTV and Bizmeka.
-
YoY increase in revenue due to rise in demand for IDC and Bizmeka.
B. Data Revenue
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| Data | 402.4 | 408.3 | -5.9 | -1.4 % | 406.9 | -4.5 | -1.1 % | 402.4 |
| ¨ Leased line | 268.3 | 277.4 | -9.1 | -3.3 % | 275.8 | -7.6 | -2.7 % | 268.3 |
| Local | 116.8 | 118.3 | -1.5 | -1.3 % | 118.0 | -1.2 | -1.0 % | 116.8 |
| Domestic long distance | 80.2 | 83.3 | -3.2 | -3.8 % | 84.0 | -3.8 | -4.6 % | 80.2 |
| International long distance | 5.0 | 7.1 | -2.1 | -29.4 % | 4.2 | 0.8 | 18.7 % | 5.0 |
| Broadcasting & others | 66.2 | 68.6 | -2.3 | -3.4 % | 69.6 | -3.3 | -4.8 % | 66.2 |
| ¨ Data leased line | 37.8 | 35.7 | 2.1 | 5.9 % | 32.5 | 5.3 | 16.2 % | 37.8 |
| Packet data | 1.6 | 1.7 | -0.1 | -7.6 % | 2.1 | -0.5 | -25.1 % | 1.6 |
| National network ATM | 20.7 | 19.8 | 0.9 | 4.3 % | 17.8 | 2.9 | 16.5 % | 20.7 |
| VPN | 15.4 | 14.1 | 1.4 | 9.8 % | 12.6 | 2.9 | 22.8 % | 15.4 |
| ¨ Kornet | 62.9 | 61.4 | 1.5 | 2.5 % | 65.6 | -2.7 | -4.1 % | 62.9 |
| ¨ Satellite | 26.0 | 25.3 | 0.7 | 2.7 % | 27.2 | -1.3 | -4.7 % | 26.0 |
| ¨ Others | 7.5 | 8.6 | -1.1 | -13.0 % | 5.8 | 1.7 | 29.5 % | 7.5 |
4
C. Telephone Revenue
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| Telephone revenue | 1,023.2 | 1,064.4 | -41.3 | -3.9 % | 1,056.5 | -33.3 | -3.2 % | 1,023.2 |
| ¨ Subscriber connection | 340.3 | 344.9 | -4.7 | -1.3 % | 349.4 | -9.1 | -2.6 % | 340.3 |
| Subscription fee | 9.2 | 10.5 | -1.3 | -12.3 % | 11.1 | -1.9 | -17.2 % | 9.2 |
| Basic monthly fee | 270.1 | 272.4 | -2.3 | -0.9 % | 276.6 | -6.6 | -2.4 % | 270.1 |
| Installlation | 7.9 | 8.7 | -0.8 | -9.2 % | 8.9 | -1.0 | -11.5 % | 7.9 |
| Interconnection | 53.1 | 53.4 | -0.2 | -0.4 % | 52.7 | 0.4 | 0.8 % | 53.1 |
| ¨ Local | 224.2 | 228.1 | -3.9 | -1.7 % | 243.2 | -19.0 | -7.8 % | 224.2 |
| Usage | 147.5 | 151.9 | -4.5 | -2.9 % | 164.6 | -17.2 | -10.4 % | 147.5 |
| Interconnection | 23.8 | 23.8 | 0.1 | 0.3 % | 26.8 | -2.9 | -11.0 % | 23.8 |
| Others | 52.9 | 52.4 | 0.5 | 0.9 % | 51.8 | 1.1 | 2.1 % | 52.9 |
| ¨ Domestic long distance | 152.2 | 159.8 | -7.7 | -4.8 % | 166.4 | -14.3 | -8.6 % | 152.2 |
| Usage | 142.6 | 150.6 | -8.0 | -5.3 % | 159.9 | -17.3 | -10.8 % | 142.6 |
| Interconnection | 9.0 | 9.0 | 0.1 | 0.7 % | 6.3 | 2.7 | 43.3 % | 9.0 |
| Others | 0.5 | 0.3 | 0.2 | 78.7 % | 0.2 | 0.3 | 129.8 % | 0.5 |
| ¨ International long distance | 46.9 | 44.5 | 2.4 | 5.4 % | 51.8 | -4.8 | -9.3 % | 46.9 |
| ¨ International settlement | 49.7 | 47.1 | 2.6 | 5.5 % | 42.9 | 6.8 | 15.8 % | 49.7 |
| ¨ VoIP | 10.2 | 9.1 | 1.1 | 12.1 % | 7.6 | 2.6 | 33.9 % | 10.2 |
| ¨ VAS | 93.4 | 98.7 | -5.3 | -5.4 % | 94.4 | -1.0 | -1.1 % | 93.4 |
| ¨ Public telephone | 10.6 | 14.1 | -3.4 | -24.5 % | 14.8 | -4.1 | -28.1 % | 10.6 |
| ¨ 114 phone directory service | 32.1 | 28.5 | 3.5 | 12.4 % | 31.1 | 1.0 | 3.2 % | 32.1 |
| ¨ Others | 63.6 | 89.5 | -25.9 | -28.9 % | 54.9 | 8.7 | 15.9 % | 63.6 |
Local, DLD
- QoQ and YoY decline in revenue from fall in subscribers and call traffic.
International settlement
- QoQ and YoY increase due to rise in international call traffic.
Others
- QoQ decrease was due to rise in revenue affected by a temporary increase in international ISDN demand in the previous quarter.
5
D. LM(Land to Mobile) Interconnection Revenue
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| LM Revenue | 364.1 | 392.1 | -28.0 | -7.1 % | 411.9 | -47.8 | -11.6 % | 364.1 |
| LM interconnection cost | 184.5 | 206.2 | -21.7 | -10.5 % | 200.7 | -16.2 | -8.1 % | 184.5 |
LM Revenue
- QoQ and YoY decline due to decrease in subscribers and call traffic.
LM Interconnection cost
- It takes approximately two months for operators to verify the actual volume of LM traffic. Thus figures for 2 months of every quarter are based on estimation, resulting in disparity with actual call traffic.
E. Wireless Revenue
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| Wireless revenue | 419.9 | 368.2 | 51.7 | 14.0 % | 380.4 | 39.5 | 10.4 % | 419.9 |
| ¨ PCS resale | 418.2 | 364.9 | 53.3 | 14.6 % | 363.4 | 54.8 | 15.1 % | 418.2 |
| PCS service | 254.4 | 255.6 | -1.3 | -0.5 % | 229.4 | 24.9 | 10.9 % | 254.4 |
| Handset sales | 163.9 | 109.3 | 54.6 | 50.0 % | 134.0 | 29.9 | 22.3 % | 163.9 |
| ¨ Others | 1.7 | 3.3 | -1.6 | -49.6 % | 16.9 | -15.3 | -90.2 % | 1.7 |
Wireless revenue
- QoQ and YoY increase due to rise in PCS service and handset sales.
6
F. Operating Expenses
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| Labor | 683.3 | 648.3 | 35.0 | 5.4 % | 653.2 | 30.1 | 4.6 % | 683.3 |
| ¨ Salaries & wages | 476.8 | 461.2 | 15.7 | 3.4 % | 438.3 | 38.5 | 8.8 % | 476.8 |
| ¨ Employee benefits | 108.5 | 118.7 | -10.2 | -8.6 % | 109.5 | -1.0 | -0.9 % | 108.5 |
| ¨ Provision for retirement | 98.0 | 68.5 | 29.5 | 43.1 % | 105.4 | -7.4 | -7.0 % | 98.0 |
| Commissions | 170.9 | 196.0 | -25.2 | -12.8 % | 153.0 | 17.9 | 11.7 % | 170.9 |
| Marketing expenses | 326.3 | 281.7 | 44.7 | 15.9 % | 211.7 | 114.6 | 54.1 % | 326.3 |
| ¨ Sales commission | 230.1 | 181.5 | 48.6 | 26.8 % | 141.0 | 89.1 | 63.2 % | 230.1 |
| ¨ Sales promotion | 79.3 | 58.0 | 21.3 | 36.7 % | 50.2 | 29.1 | 58.0 % | 79.3 |
| ¨ Advertising | 16.9 | 42.2 | -25.2 | -59.8 % | 20.6 | -3.6 | -17.6 % | 16.9 |
| Provision for doubtful accounts | 6.9 | 12.8 | -6.0 | -46.6 % | 20.2 | -13.4 | -66.1 % | 6.9 |
| Depreciation | 482.3 | 623.5 | -141.1 | -22.6 % | 477.3 | 5.0 | 1.0 % | 482.3 |
| Repairs and Maintenance | 22.0 | 69.9 | -47.9 | -68.5 % | 25.6 | -3.5 | -13.9 % | 22.0 |
| Cost of goods sold | 157.3 | 142.4 | 14.8 | 10.4 % | 182.3 | -25.1 | -13.7 % | 157.3 |
| ¨ PCS handset cost | 160.6 | 122.9 | 37.7 | 30.7 % | 145.2 | 15.4 | 10.6 % | 160.6 |
| ¨ PDA, WLAN card, others | -3.3 | 19.6 | -22.9 | N/A | 37.1 | -40.5 | N/A | -3.3 |
| Cost of service provided | 476.8 | 508.7 | -31.9 | -6.3 % | 442.9 | 33.9 | 7.7 % | 476.8 |
| ¨ Cost of service | 226.5 | 240.3 | -13.8 | -5.7 % | 193.2 | 33.4 | 17.3 % | 226.5 |
| PCS resale network cost to KTF | 128.8 | 132.7 | -3.9 | -2.9 % | 113.1 | 15.7 | 13.9 % | 128.8 |
| SI service cost | 53.9 | 73.1 | -19.2 | -26.3 % | 42.8 | 11.1 | 25.9 % | 53.9 |
| Others | 43.8 | 34.5 | 9.4 | 27.1 % | 37.3 | 6.6 | 17.6 % | 43.8 |
| ¨ International settlement cost | 59.3 | 57.0 | 2.3 | 4.1 % | 45.8 | 13.4 | 29.3 % | 59.3 |
| ¨ LM interconnection cost | 184.5 | 206.2 | -21.7 | -10.5 % | 200.7 | -16.2 | -8.1 % | 184.5 |
| ¨ Others | 6.5 | 5.3 | 1.3 | 23.8 % | 3.2 | 3.3 | 104.9 % | 6.5 |
| R&D | 56.8 | 88.9 | -32.1 | -36.1 % | 53.8 | 3.0 | 5.6 % | 56.8 |
| Activation/installation and A/S cost | 96.5 | 92.8 | 3.7 | 0.0 | 75.8 | 20.7 | 0.3 | 96.5 |
| Others | 154.9 | 147.5 | 7.3 | 5.0 % | 147.4 | 7.5 | 5.1 % | 154.9 |
| CAPEX* | 285.0 | 869.7 | -584.7 | -67.2 % | 280.5 | 4.5 | 1.6 % | 285.0 |
Labor
- QoQ and YoY increase mainly due to rise in paygrade and a 2.6% salary increase as a result of wage negotiations in previous year.
Marketing expenses
- QoQ and YoY increase due to heightened competition in both wireless and internet markets and new businesses promotion costs.
COGS
- Rise in QoQ COGS due to increased PCS subscribers and PCS hanset costs.
Cost of service provided
-
QoQ decrease mainly due to 1) drop in SI service costs and 2) decrease in LM interconnection costs.
-
YoY increase was due to 1) rise in PCS resale network costs and 2) rise in international settlement costs.
Activation/installation and A/S cost
- From 2008 installation and A/S cost, which was previously included in Others, will be provided separately.
7
G. Non-operating Income
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| Non-operating income | 134.3 | 77.9 | 56.4 | 72.4 % | 146.6 | -12.2 | -8.3 % | 134.3 |
| ¨ Gains on disposition of investments | 0.0 | 2.2 | -2.2 | N/A | 0.0 | 0.0 | N/A | 0.0 |
| ¨ Gains on disposition of tangible assets | 0.4 | 1.7 | -1.2 | -73.6 % | 7.0 | -6.6 | -93.8 % | 0.4 |
| ¨ Interest income | 18.2 | 41.9 | -23.7 | -56.6 % | 20.1 | -1.9 | -9.6 % | 18.2 |
| ¨ FX transaction gain | 6.3 | 1.5 | 4.9 | 328.9 % | 0.9 | 5.4 | 590.8 % | 6.3 |
| ¨ FX translation gain | 11.0 | -12.3 | 23.2 | N/A | 2.2 | 8.8 | 394.8 % | 11.0 |
| ¨ Gain on equity method | 19.1 | 15.3 | 3.7 | 24.5 % | 27.0 | -7.9 | -29.3 % | 19.1 |
| ¨ Others | 79.3 | 27.6 | 51.7 | 187.3 % | 89.3 | -10.0 | -11.2 % | 79.3 |
Interest gain
- Decrease in cash and cash equivalents resulted in decrease in interest gain.
Others
-
YoY decrease due to temporary rise in gain on return of allowance for liabilities.
-
QoQ increase due to 1) rise in gain on appraisal of derivatives and 2) increase in gain on return of allowance for liabilities.
H. Non-operating Expenses
| (KRW bn) | 2008 1Q | 2007 4Q | QoQ | 2007 1Q | YoY | 2008 Cumm. | ||
|---|---|---|---|---|---|---|---|---|
| Amount | r % | Amount | r % | |||||
| Non-operating expenses | 269.6 | 178.1 | 91.6 | 51.4 % | 144.2 | 125.4 | 87.0 % | 269.6 |
| ¨ Interest expense | 72.6 | 74.6 | -2.0 | -2.6 % | 77.4 | -4.8 | -6.2 % | 72.6 |
| ¨ FX transaction loss | 2.0 | 1.8 | 0.2 | 10.5 % | 0.8 | 1.2 | 146.9 % | 2.0 |
| ¨ FX translation loss | 108.4 | 12.5 | 95.9 | 767.1 % | 17.2 | 91.2 | 531.4 % | 108.4 |
| ¨ Loss on equity method | 36.5 | 17.5 | 19.0 | 108.3 % | 8.2 | 28.3 | 347.4 % | 36.5 |
| ¨ Loss on disposition of fixed assets | 7.9 | 20.8 | -12.9 | -61.9 % | 8.3 | -0.3 | -3.9 % | 7.9 |
| ¨ Others | 42.2 | 50.8 | -8.6 | -16.9 % | 32.4 | 9.8 | 30.3 % | 42.2 |
FX translation loss
- QoQ and YoY increase in FX translation loss due to increase in translations loss for foreign bonds affected by rise in exchange rate
8
Appendix : Factsheet Mar-08
Broadband
| Mar-07 | Apr-07 | May-07 | Jun-07 | Aug-07 | Sep-07 | Oct-07 | Nov-07 | Dec-07 | Jan-08 | Feb-08 | Mar-08 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Broadband Subs | 6,449,729 | 6,492,321 | 6,515,008 | 6,522,631 | 6,511,779 | 6,522,080 | 6,520,022 | 6,513,293 | 6,515,541 | 6,518,821 | 6,555,162 | 6,627,175 |
| Net Addition | 36,334 | 42,592 | 22,687 | 7,623 | -1,069 | 10,301 | -2,058 | -6,729 | 2,248 | 3,280 | 36,341 | 72,013 |
| o Megapass Lite | 5,106,874 | 5,424,229 | 5,437,207 | 5,430,552 | 5,385,578 | 5,368,990 | 5,344,715 | 5,317,444 | 5,295,715 | 5,272,001 | 5,279,299 | 5,297,511 |
| o Megapass Premium | 579,580 | 258,690 | 262,392 | 264,185 | 267,596 | 270,462 | 273,295 | 275,144 | 277,399 | 282,599 | 286,665 | 302,459 |
| o Megapass Special | 7,739 | 32,237 | 35,463 | 36,641 | 38,873 | 40,161 | 41,754 | 43,623 | 45,383 | 47,297 | 51,535 | 59,049 |
| o Megapass Ntopia | 755,536 | 777,165 | 779,946 | 791,253 | 819,732 | 842,467 | 860,258 | 877,082 | 897,044 | 916,924 | 937,663 | 968,156 |
| Broadband M/S | ||||||||||||
| KT | 45.3 % | 45.4 % | 45.4 % | 45.2 % | 44.8 % | 44.7 % | 44.5 % | 44.3 % | 44.3 % | 44.1 % | 44.2 % | |
| Hanaro | 25.6 % | 25.5 % | 25.5 % | 25.5 % | 25.4 % | 25.3 % | 25.2 % | 25.1 % | 24.9 % | 24.8 % | 24.6 % | |
| Powercomm | 9.3 % | 9.8 % | 10.1 % | 10.3 % | 10.7 % | 10.9 % | 11.1 % | 11.4 % | 11.7 % | 11.9 % | 12.0 % | |
| Dacom | 0.7 % | 0.7 % | 0.6 % | 0.6 % | 0.6 % | 0.5 % | 0.5 % | 0.5 % | 0.5 % | 0.4 % | 0.4 % | |
| SO | 17.0 % | 17.0 % | 17.1 % | 17.2 % | 17.3 % | 17.4 % | 17.5 % | 17.6 % | 17.5 % | 17.6 % | 17.7 % | |
| Others | 2.0 % | 1.7 % | 1.3 % | 1.2 % | 1.2 % | 1.2 % | 1.1 % | 1.1 % | 1.1 % | 1.1 % | 1.1 % | |
| Wireless | ||||||||||||
| Mar-07 | Apr-07 | May-07 | Jun-07 | Aug-07 | Sep-07 | Oct-07 | Nov-07 | Dec-07 | Jan-08 | Feb-08 | Mar-08 | |
| NESPOT | 450,147 | 447,858 | 446,719 | 432,068 | 421,020 | 419,228 | 411,653 | 406,475 | 401,831 | 398,743 | 395,395 | 391,921 |
| WiBRO | 1,224 | 4,508 | 6,532 | 19,887 | 38,425 | 64,361 | 80,431 | 102,475 | 106,153 | 115,917 | 120,443 | 145,290 |
| KTF Resale | 2,806,610 | 2,838,079 | 2,888,641 | 2,944,658 | 2,920,531 | 2,916,277 | 2,870,464 | 2,873,989 | 2,927,201 | 2,943,999 | 2,919,223 | 2,938,583 |
| Mega-TV | ||||||||||||
| Mar-07 | Apr-07 | May-07 | Jun-07 | Aug-07 | Sep-07 | Oct-07 | Nov-07 | Dec-07 | Jan-08 | Feb-08 | Mar-08 | |
| MegaTV | 38,765 | 39,463 | 42,511 | 55,254 | 74,999 | 148,354 | 233,809 | 296,912 | 324,609 | 390,027 | 495,913 | 567,230 |
| Fixed-line | ||||||||||||
| Mar-07 | Apr-07 | May-07 | Jun-07 | Aug-07 | Sep-07 | Oct-07 | Nov-07 | Dec-07 | Jan-08 | Feb-08 | Mar-08 | |
| Telephony (000) | 21,263 | 21,259 | 21,262 | 21,238 | 21,191 | 21,184 | 21,139 | 21,103 | 20,919 | 20,882 | 20,842 | 20,818 |
| Household (000) | 20,281 | 20,266 | 20,259 | 20,219 | 20,153 | 20,117 | 20,064 | 20,018 | 19,980 | 19,936 | 19,894 | 19,861 |
| Business (000) | 982 | 993 | 1,003 | 1,019 | 1,037 | 1,067 | 1,075 | 1,085 | 938 | 946 | 948 | 958 |
| Domestic Long Distance (000) | 18,713 | 18,725 | 18,749 | 18,740 | 18,719 | 18,697 | 18,658 | 18,599 | 18,571 | 18,563 | 18,532 | 18,512 |
| * Ann (000) | 1,882 | 1,958 | 2,020 | 2,095 | 2,171 | 2,214 | 2,252 | 2,282 | 2,308 | 2,348 | 2,387 | 2,433 |
| * Ringo (000) | 3,809 | 3,664 | 3,785 | 3,779 | 3,774 | 3,783 | 3,610 | 3,605 | 3,843 | 3,830 | 3,817 | 3,821 |
| * Caller ID Users (000) | 5,403 | 5,438 | 5,478 | 5,503 | 5,525 | 5,538 | 5,538 | 5,532 | 5,538 | 5,548 | 5,553 | 5,569 |
| * My Style(Local) (000) | 671 | 775 | 834 | 928 | 1,053 | 1,075 | 1,060 | 1,044 | 1,022 | 1,013 | 1,005 | 985 |
| * My Style(DLD) (000) | 614 | 707 | 757 | 834 | 931 | 951 | 936 | 920 | 897 | 885 | 877 | 858 |
| Fixed-line M/S | ||||||||||||
| Local M/S (subscriber base) | 91.7 % | 91.6 % | 91.5 % | 91.4 % | 91.1 % | 91.0 % | 90.8 % | 90.6 % | 90.4 % | 90.3 % | 90.2 % | 90.1 % |
| DLD (revenue base) | 85.6 % | 85.6 % | 85.7 % | 85.7 % | 85.6 % | 85.6 % | 85.5 % | 85.4 % | 85.4 % | 85.4 % | 85.4 % | 85.3 % |
| Reference Data | ||||||||||||
| Mar-07 | Apr-07 | May-07 | Jun-07 | Aug-07 | Sep-07 | Oct-07 | Nov-07 | Dec-07 | Jan-08 | Feb-08 | Mar-08 | |
| Population (000) | 48,418 | 48,431 | 48,444 | 48,457 | 48,457 | 48,457 | 48,457 | 48,457 | 48,457 | 48,444 | 48,444 | 48,444 |
| Number of Household | 16,194 | 16,194 | 16,194 | 16,194 | 16,194 | 16,194 | 16,194 | 16,194 | 16,194 | 16,194 | 16,194 | 16,194 |
Fixed-line
-
Telephony : From Jan.2008, number of business line subscribers will be included in Telephony, pursuant to the reporting rules of MIC
-
Household : Formerly Local subscribers