KT - Earnings call transcript Q1 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning and good evening. Thank you all for joining this conference call. And now we will begin the conference of the 2021 First Quarter Earnings Results by KT. We would like to have welcoming remarks from Mr. Seung-Hoon Chi, KT IRO. Mr. then, And

to will This CFO, by results entertain IRO. would and Q&A Mr. over Young-Jin Chi, Seung-Hoon will present start questions. KT like we Now, conference [Operator followed the with your conference session. to Kim, Instructions] earnings turn a a presentation

Seung-Hoon Chi

Good afternoon. Seung-Hoon, IRO. m s Chi I’ KT’

slides this in on listen webcasting And are you release We you can call. as call. earnings also follow the the

KT’ begin QX Earnings s Let us now Presentation. XXXX

estimates an financial operating that yet today’ s on Before standards results we begin, K-IFRS includes based please note to presentation be outside and and are reviewed by auditor.

cannot performances, of financial please we are and historical that accuracy reminded changes. for figures these except As and be subject ensure business completeness to data,

for ‘ on his greetings will I Now, and XX Young-Jin, QX invite our Kim earnings. presentation CFO,

Young-Jin Kim

including was on other billion. XX.X% revenue billion, platform I’ in and profit core businesses profit was m and KT’ up business XXX key will balanced KT billion, service was content KRW KT’ ‘ Driven year, financial, Service a X.X% billion. can of for to driven the including s and year-over-year. incumbent while revenue year and X.X% was midst digital which again enterprise QX for cloud. company’ X,XXX.X s untapped reorganized feasibility and around growth which DX, growth up main Young-Jin, X.X% core messaging. up AI at highlights. demand businesses, was confirm QX business, with to has on profit AI businesses which Also, KRW by to top of traffic, was across by KRW and operating operating mostly Kim media growing and and of up that Digico. was Internet, been basis businesses, has businesses DX KRW around year, in has s led operating has on environment portfolio once reporting XG launching business platform contact-free up platform CFO. the BXB, that and growth was begin year came In geared and billion potential its services, KT’ expanded Good in line I of or revenue up the KRW on excel KT XX XXX.X s transformation, success as data KT revenue is consolidated of afternoon. X,XXX.X BXB X,XXX.X aggressively able growth growth. XX.X% areas

the insurance adopt provide is contact bot financial, DX which AI which and service information development and for that are traditionally i.e., for instance, public expanding operate voice voice a call And to of centers. and centers on sectors For uses areas, services other currently merchants, booking small retail. delivery. top In telecom DX are that for services call existing we

available for XG information digital-based was service next-generation, also for expand development continue trend both the declines and up to include On CITS, in the prepare area. hotel subscriber plan wireless year-over-year. roaming and For lineup Island Ulsan robots distribution robot barista we Growth system, Jeju mass despite robotics, service will transport and expand quarantine in service were a we care, era started We and is undertaking telecom become a one where use, Also business from upcoming serving robot revenue, are city. from which base And first off launched and and reference Gwangju the the platform to offerings. and to as ARPU robots, sustained. revenue robots with growing well. intelligent, on we to market successful project for

into the was is to to with of which TV able key offering transformation the to much of base trillion XX.X more we the as X Internet Studio differentiated and synergies April in synergies KT’ plan Also Also, invested Genie, broadband s you which an for entity further as Altimedia, And January. trend total finance core to an to its in Skylife also Studio into platform. asset funding actively in laid within with capital telecom, sold year. application. financial make corporation group. end customers the further end service #X speed the There s and specializing businesses engaged equity in for revamped quarterly off there established secure in content Bank, with foundation as as whose and content, platform, competitiveness up which than and supplies back solutions additions capabilities which acquiring benefits, And Genie, KRW the also by Banksalad, media the management and K We trillion limited through Storywiz bolster for increasing end group’ the of with in was and XXX,XXX. we XXXX was the before of were group. We deposit as in of increase media an net of share know, reported across s well. KRW grow strategic maximizing is is media a able into investment progress by was KT of decided technical market partnerships KT were businesses sector upward Digico. customer additional subscribers We deposit of data business broadband equity investments Group’ potential Powertel we X,XXX,XXX X,XXX,XXX, we to XXXX. believed

profit, on KRW to went top EBITDA up revenue X.X% up force. moving on to Total was driven Now under was XXXX to was business Net billion profit billion. year-on-year year KRW KRW on earnings. KRW XXX.X to up X.X% report X,XXX.X on line full growth to XX.X% XX.X% billion. year year while on by coming QX billion, Operating XXX.X expansions growth, X,XXX.X up

Operating is expenses. on up and expense to Next X,XXX.X year-on-year billion expenses higher X.X% was expenses. KRW on operating business-related sales

ratio QX points ‘ was XX was XX.X%. X.X down to end financial X.X down year-on-year percentage of percentage points debt of on And the position. as Next, net Debt-to-equity XXX.X%, ratio year-over-year.

on is XXX.X billion. CapEx QX for was Next spend CapEx. KRW

revenue Next, service let’ each KRW year-on-year s up a lines. up the on steady revenue year-on-year billion performances KRW was business Wireless back was Wireless growth. X% the XG at billion. to take to of X.X% look of X,XXX.X subscriber X,XXX.X of

wireless XX,XXX,XXX, XX% XXXX, end As were subscribers, subscriber while QX of base. for subscriber X.X handset there total accounts of were of million XG which

XXX.X slowing subscribers, was to revenue broadband positive, of enterprise Despite to Next in is declines the high-quality Fixed growth continuous line rate-based down up billion. erosion. rise IPTV X.X% fixed speed fixed and sales interconnect were Internet was on year XXX.X subscribers, quite On on KRW business. on telephony and billion. the KRW line top revenue in line in product revenue year X.X%

to On XXX.X the growth was billion. the media based back platform, of subscriber growth and revenue X.X% sustained year-on-year IPTV up revenue KRW on

is Next to increases driving in year-on-year X.X%. data revenue business. BXB to revenue traffic, billion. up BXB KRW XXX.X around Demand was led online BXB up contact or X.X% free

BXB X.X% revenue was IT While deal and year-on-year solutions from back the the on government. up new of projects digital

continued. and on which cloud, on revenue year-on-year from revenue AI digital in IDC, X.X% the customers business the AICC demand includes transformation, greater as uptrend While DX blockchain, was and up

XX.X% in group KT impacted back real by acquiring to subdued Next affiliate, Card service as is performance. was year business XX.X revenue to XXX.X down Estate management down increase decline sales domestic was to lower well a revenue on year billion. subscribers. Despite of and OTS transfer as KRW on due to was X.X% to pandemic, volume. COVID revenue driven COVID year by BC on consumption the X% of on On hotel the the building business on KRW estate KRW billion Skylife up billion XXX.X subsidiary sluggish in

platform the pandemic, performances XX.X% our KRW constraints s by higher of which from billion well on Hows, digital back key year, reporting M key from content the subsidiaries. XXX.X content such on in of of One as these up affiliates the transition Genie revenue better is Despite as pillars as business the KT’ subsidiaries, we growth was financial affiliates COVID KTH, and are Nasmedia, Music from revenue the from posed business. business seeing

is KT’ and s So s transitioning that underpinning ‘ year, KT’ growth. Digico a of This into highlights. ends earnings key XX focus QX

Our beginning, our QX service And further will XX of of we than XXXX forward. was expect and trillion. digital as consolidated growth guidance revenue as company a the with accelerate year-on-year stand-alone growth revenue above go platform for at we more X% KRW

from We results to of will we plan generating group and continue bring and affiliates and revamping to investors and your, encouragement, Also, platform. look while growth stable you. forward revenue tangible businesses our and pursue telecom structure. analyst, of from synergies We bolster business across thank our business support actively BXB to

the please information, detailed have more circulated. For refer document previously that we to

Instructions] begin will [Operator the now We Q&A.

Operator

Samsung from the And The Joonsop Securities. Instructions] will from be provided first Kim question [Operator Choi be provided by Minha Securities. will next question by KB

Joonsop Kim

I’ from Securities. m Kim Joonsop KB

understand such behind First quarter. first of question. the like assessment management’ what That’ great this first such is performance s to performance. Would congratulations all, a a s for you good to

is, what’ seems Second Once the line like reason s slowed. again, has PSTN it that? erosion your behind speed top

Unidentified Company Representative

both Thank you, respond those Joonsop to your of I question. will Kim questions. Mr. for

in attributable affiliates year-over-year to drove growth results and as AI made, and performance top regarding to our had from presentation well, relates good management’ causes the what is which from question core good the subsidiaries, line s improvement well KT’ First good businesses just mentioned Well, from as DX basically, behind profit. performance. I KT’ s that the is s view in and a operating the as during

first overall XG and includes top premium all, growth. increases wireless business in Internet in or MIT we of well mobile, our and line improvement We’ which both the Now ve call telecom TV. as -- which acquisition the traditional on of this the business, as subscribers, Internet drove subscribers business seen

to digital we’ monthly to we’ home been well. one messaging advertising in the Internet, Transmission we double-digit growth. a we had the transformation platform-related of back that, and while able contributed And if had also as check-in also top launched were from of growth -- the in a DX positive usage impact, businesses, we’ fees base good shopping. subscriber our commission also, Wire call our has gone ve also, actually at platform also service revenues of up fees and making for look also achieve And of which terms seen business In seen IPTV performance. Also you October. -- GiGA have on business, IPTV-related ve a is been ve

at significant quite seeing in absolute this size growth numbers subscriber that Although top not line time, is of well steep as are we in as point terms the revenue.

the to were some more being sustain than business, opening quarter And for high double get the of also Yongsan with in represented by ve the cloud IDC starting new been customers, we we’ performance digit. acquiring of first IDC, able rate Center, inflow the numbers. good and of to growth For booked

pursue platform businesses, our we financial, In will media from annual perspective, From as group cost terms the improvement. line these commerce, efficiencies continue continuously of of from make that in the terms well are digital-based sure we will telecom growth on digital business as can operating profit improve we growth both and platform-based both sustain of that our areas seeing annum core affiliate realize so-called to our also we and we per advertising, may businesses continue on growth the growth. top forecast, year-on-year so we so with a contribution, our

question to erosion, factors. down are seeing PSTN reason Second can why relates cite I X and the we key of slowing

in home to the we we or the environment, further a Internet-based businesses basically network-based at -- spread or The speed seen slow we from has also able down base is first the enterprise stabilize by the rate up reason rise. for drive enterprise And the untapped able we’ flat is revenues declining actually with home slowed. in introducing subscriber product, contact-free ve the the it were which were intelligence of decline to And telephony. tariff And telephony. that decline telephony, that

Operator

question will question by June Minha from presented Kiwoom from following Securities. Securities. next Samsung presented And be Jang The Min Choi be the by will

Minha Choi

from questions. you I’ like m m Securities. ask I’ Minha. Samsung to I would X Choi

And have been color subsidiaries have you We quite aggregate and by hint from number the profit be COVID a affiliates? and your that revenue. have could overall, also, media earnings you these on us give basis, your operating pandemic. wireless subscribers earnings been steady seen a of negatively of quite what a the forward And to as to seems content positive. and and there affiliates. Could you But the provide when, if projection business, as your including to from stable turnaround impacted subsidiaries expect group is some total in your going for growth

Unidentified Company Representative

Ms. you, Minha. Thank Choi

You regarding asked affiliates. question group

KT of Estate You and going asked affiliate forward. Skylife. about are Card, KT key BC our forecast I group earnings believe subsidiaries

of Chinese back the year, In fallen. terms pandemic, Card on UnionPay-based COVID acquired the of with the well fall acquiring volume, in inbound tourists, last domestic as the BC volume have the overall as

for KRW the with had QX acquiring of volumes there positive on of a an domestic year-over-year terms was XX and around impact that In billion impact. recovery and consumption, of a upward basis, the

UnionPay-based Now on credit inbound to so tourist still able negative we had still the that some cards, recover demand haven’ the t or been impact. consumption,

effort all sure the all, make terms in the utmost exert the achieve in our so could we So of we profit, that will at we year. previous that level of least

Now for Estate, decline. area. year that last we Busan expect for selling from in and KT sales-related there some sales Daegu was eliminated, this But year, will and one-off there some office be factor revenues that with appointments now

But pandemic, there a recovery. the on seeing the quite conservative Now basis, so on hotel taking that currently impact of business. signs we projection are business, year-to-date a lingering is from for are we still, some

a However, the rental-related slight increase from there revenue. is

all, one-off impact in again, now on overall we So look of at ended, the once a terms line. basis, because revenue Estate, an top be expect sales-related you all KT if slight in dip there is would that

release for satellite while terms their the is declining. an But earnings we service, schedule are X today. of in seeing Skylife, actually for call there, subscriber they For subscribers increase OTS have the p.m.

make So have HCN and products, that acquisition up we advertisement-related off Also, with also these offer. could effectively media including subsidiaries, of once will also we and can is TPS aside leverage completed, affiliates. bundled mobile sure with company HCN Internet. from process the what come And the we

seen to In terms services. have comes KTH commerce, in Basically, we when messaging and it of enterprise KTN we digital increases other and and have volume types Health. T-commerce of BXB

a that trend from seeing are growth revenue area. we business of So

relating ve that we of of So going other expect and also, recover advertisement Nasmedia. commerce and greater forward. verticals, to will we demand we the -- an and games, have or seen to these advertising entities so We’ start performances sales

on of we basis, sure profit, On you want from our seeing our profit with operating in bring -- an profit we line make year-over-year line. In projection expect I if look platform-based from is the with but that growth the growth our operating terms aggregate and media you at content, the we digital the operating a objective about businesses. turnaround share that line advertisement, in at are a financial to when bottom group affiliates, a annual basis, to is,

Operator

from Jang The next June Min following by question be be And presented Kiwoom will the from will Securities. presented question JPMorgan. by Stanley Yang

Min Jun Jang

Jang m Securities. Min Two I’ questions. June from Kiwoom

wireless communicated your of beginning of terms your year, year-over-year in the guidance. First, X% business, about you as growth

Now practices. to guidance be increasing I confirm QX? your your of to X%. we want just upping rate question, to give have record entire year able your or seems Second you regarding dividend-related, or quarter, the There guess, the or around is talk growth payout track certain first plan position the have ratio. issues the What your we since for be passed would around that now us

us share position dividend is what So could payout? regarding your just you with

Unidentified Company Representative

Min Jang Jun question. Mr. for you, Thank your

about First, revenue. us of updates you the regarding any our X% guidance growth or adjustments asked service of possible

the Regarding wireless any updates guidance valid. X% growth revenue, for holds service guidance on that still our

the we caller also As of we identifying XG are ring growth value-added achieve expect subscribers revenue taking of penetration we increasing this to taking see our subscribers up services by other is ARPU we will be plan see also to high providing sources And target. X% and like number growing. a and and and able revenue, its that

profit, adjusted be and confirmation. communicated still that on XX%. to promise that communicated asked to plan. is of whether XXXX, a or commitment Back basis to you May shareholders, s on we based our we we made long-term And that stand-alone ve question, we’ XX% our is in And will a out paying net mid- separate we payout and to it. keep valid, KT’ Second that ratio for plan and investors

Operator

will Stanley from question next Haesu JP from And The question Robeco. following be Yang presented Lee by will the presented Morgan. be by

Stanley Yang

ask I you X like would to questions.

performance would if XXXX, be trillion QX that stand-alone terms profit, performance communicated question this do to your for have profit been your this re KRW think of case, XXXX, reported target schedule? you this was quarter. projections or a ve is targeting target growth what of you look asked earnings willing you stellar, that the that achieved able trillion. you’ basis, But you has And increase by to X that actually QX operating First, you XXXX? X your operating lower KRW than that you because I will if at achieve when that now on of in be ahead you’ quite XXXX

would have I will understand the you that this be able you than use you for? where second, previously what whether cancel And to shares? target do you like not, your shares, think to treasury purpose? planned achieve plans treasury earlier you So for had to If would

Unidentified Company Representative

Mr. you, Yang, Stanley for question. your Thank

trillion mentioned that You target will our this Basically, able operating of profit increase basis for about further update that on year-over-year KRW XX, profit is point bring to operating are record, on to X a -- stand-alone ‘ planned will it to have our decision after achieve to we than target. we our make we in earlier And we year, time will target a we plan if after look be will whether XXXX. that that at a for we higher will basis. as track

entering looking that at specific point partnerships in where we is this do into of reviewing by share cancellation, treasury review. also M&As. But the used use strategic company to be think we or specificity are the have Regarding Then confirmed yet. would point, to that further for? time, we a possibility of will possibility of Those I of second this whether plans share synergies not under strengthen question any at alliances generate at competitiveness and or is

Operator

be will by question next presented The Lee from Robeco. Haesu

Haesu Lee

for KRW what on that share process XXX light is buyback billion. some progress of last? Shed your when will the Until

Unidentified Company Representative

Thank you Ms. for Lee your question.

BoD It’ of shares, On [Foreign You our of buying account back been through process of outstanding. about total a s buyback undertook we XX,XXX,XXX billion XX. XXX process. for which share completed we acquired have of as shares, that November buyback. share Basically, trust the KRW X, asked has whole of progress for X.X% treasury Language] March our resolved arrangement, a and which

Operator

[Foreign Language]

Unidentified Company Representative

you. Thank for joining to for and your your interest you for very you. XXXX and This XXXX. presentation. earnings KT despite of thank earnings the the questions you This your schedules. ends QX you all Thank release in our company, busy Thank ends first the quarter call

KT (KT) 11 May 212021 Q1 Earnings call transcript