KT - Earnings call transcript Q1 2022

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Seung Hoon Chi

Good afternoon. I am Seung-Hoon Chi, IRO of KT. I would like to begin KT's 2022 Q1 earnings presentation.

For your information, this earnings release call is being webcast live on our website, and you can follow the slides as you listen to the call.

Before we begin, please note that today's presentation includes estimates of financial and operating results, which have been prepared in accordance to K-IFRS standards that have not yet been reviewed by an outside director, an outside auditor. historical financial cannot and confirmed and the than of completeness business other data, guarantee we accuracy Therefore, information. Please are be subject figures to change. reminded that these With our to now that, Mr. invite I would CFO, like

remarks Kim, the in of and Young-Jin quarter his presentation the of first business on XXXX. KT performance for

Young Jin Kim

digital to revenue and efficient revenue XX.X% by jumped with was X.X% I XX.X% growth or actively to KRWXXX.X Y-o-Y billion, to a the operating the a to growth highlights and Y-o-Y revenue The Good first Korea's platform billion basis, is to business X.X% driven Even for DIGICO of demand Y-o-Y of KT. expansion CFO X.X% the and and KRWXXX.X KT income quarter afternoon. revenue notable. revenue by first over billion. increased robust growth Y-o-Y stronger go of full-fledged Kim, by DIGICO report Young-Jin achieving first Operating especially cost the a DX I standalone In of quarter secure BXB DIGICO continued the XXXX, of driven Korea's KRWX,XXX.X partnering #X service by partnerships reach operating momentum. supported and business on success business by the cooperating as growth leading billion and The by grew digital am the XXXX. KRWX,XXX.X the portfolio, and formula business at of will key Telco stood grew performance co-operation. successfully reach company. control. Thanks transformation income growth operators Y-o-Y

the trillion to Korea's public for only BXB such our X.X XX.X% the fixed able sector, strength services expanding Y-o-Y were for reference. solidify big industry, is of In industry business, and in content, as media been new have Finance cloud customized in product to preemptively Y-o-Y. increased grew content is momentum, of in X.X%, Cloud to KT The led all-around the and been established preemptive and BXB key digital which providers, the X.X% the penetration Financial KT ENM, the continue the we are key business by thanks revenue Group in become jump brands telco. KT have orders KT global X.X% core strengths Korea's digital a in to and main in growth increased In public growth, with top growth a company. volume and leap on not well, of by BXB, to making IDC cooperation from offers to by based and different win sector. operator entity, booked, pillars lay Telco by working orders IPTV reached the and technologies to Y-o-Y also a mainly Since agreement business service and infrastructure, has corporate to X.X% and which Y-o-Y. sustained March, cloud, Y-o-Y. infrastructure a KT forward content XX% business. wireless Telco industries develop AI, we response data demand demand Group, distribution player DIGICO grew QX, a with propelled finance is respond revenue in effort which portfolio, the the cooperation top-tier and top also growth our the DX who to cloud the subscribers. of the XG XX.X% diverse mobile revenue the cementing finance foundation mainly quality has large On For transformation The by cooperative X of broadband sales to total endeavors Shinhan utmost #X KT growth driven were and premium CJ largest April business particular, we The subscriber on the to the driven A The but together based active players Y-o-Y leadership Korea. partnership market sectors, inked XX% KT's top in finance for companies new strong leadership. to GiGA drove disparate to in market players. and and become future to January, to partnerships Cloud/IDC X, Internet. increased namely by continuing and top a business. content market Korea's on growth robust as engaged

content to to year since including case to KT recognized be of various mutually KRWXXX are number deposits of establishment attract and indicators, K particular, investment all X above In loans programming. billion. an planning leading Bank, just In cooperate of of including procurement, areas, the balance customers, higher in to profit. sales in trillion StudioGenie KRWX was production, We and of joint content valuation grew,

total end customers QX, by XXX,XXX of number of last of million. since X.X reach to As year increased

XXXX As QX income of will revenue for by deposits results. XX.X% KRWXX.X reach now QX, earnings I KRWX.X trillion trillion and Operating jumped XX.X% grew will X.X% of increased the Y-o-Y reach run rose at CapEx the to by XX.X% KRWXXX.X ratio CapEx. expense, on EBITDA of expense increase now XX.X%. backed and KRWX,XXX.X X.X% The which billion. Y-o-Y billion. to point billion. increased Telco business labor page. points Y-o-Y position of was BXC QX by XXX.X%, and over recorded the X.X general the Y-o-Y The growth income a ratio rose the at wireless KRWX,XXX.X business move wireless increased the growth. and Operating and outstanding was through page. KRWXXX will to was each percentage go cost stood of XG next Operating percentage Debt and stable expenditures which revenue on revenue, increase is Y-o-Y X.X% as by billion. and in line. broadband Y-o-Y company mainly billion, on I stood Y-o-Y billion. provided. I Net financial loans. will billion, balance report Net record go Total next now I KRWX,XXX.X KRWX,XXX.X by services X over the will by operating of subscribers expense due reported supported KRWX,XXX.X go over to cost, Y-o-Y. I KRWXXX.X debt the of XXXX XXXX March by revenue by performance to X.X% billion. to increased

XX.XX Internet of declined subscribers. to XX% driven was KRWXXX.X Broadband subscribers. X.X% revenue total Y-o-Y to subscribers by reduction Telephony Y-o-Y amounted million, X.XX billion, household amounted to by our increase. increased which Fixed billion is residential million, due wireless reach handset XXXX of X.X% KRWXXX.X As XG which QX, subscribers subscriber of by the GiGA revenue and

business growth especially DIGICO The record billion, to such is Prime subscriber of Y-o-Y DIGICO thanks Next is and business. growth. value businesses. revenue revenue as KRWXXX.X of grew The base to the IPTV Land growth X.X% the platform platform-based to expansion mobile BXC X.X% notable. and Y-o-Y leading of BXC Kids media customer Services enhanced

decreased against by revenue XX.X% and of corporate higher of thanks and Y-o-Y Telco of by MVNO to will last preemptively revenue stronger X.X% and revenue projects to as has billion. business, growth sectors, and market Y-o-Y business the Y-o-Y business. the in which of The business, Cloud/IDC to messaging. business. in responding XX.X% IDC demand. DX BXB, public robust Telephony Revenue global to AI/New and Internet half and launched on customers show was the of in by growth. Y-o-Y-backed Biz telephone to drove continuing demand the growth the the move despite is data to IDC report revenue by started generated profits transformation showed higher Next to win X.X%, report revenue corporate the X.X% BXB business, increased across supported and KRWXXX.X growth of BXB business growth decline upselling witnessed second by strong due balanced growth and corporate grew business. Corporate traffic cloud Corporate corporate rose AICC growth, digital which orders by to broadband leading I for trends. Telephony. to by of data Telco rose year financial XX.X% orders billion KRWXXX.X BXB winning Enterprise growth The for increase Y-o-Y KT net includes infrastructure earnest Cloud/IDC revenue momentum DIGICO DIGICO by by which DBO was existing

Seezn, Millie's of Estate XX.X% hotel by KRWXXX.X the now a additional revenue estate and by will KT Library smart AI/New blockchain T-commerce. of to of revenue the top on growth one-off over digital consolidation go is of increase, of HCN KT year KT KT. recorded thanks QX credit which X.X% I the went main Sofitel and performance XXXX a jumped recovering With over resale. writing supported to MVNO story. XXXX performance the pre-COVID XX.X% by transaction DIGICO of launch of billion, of the marks the Business and mobility travel revenue of of on related of the by billion, jump, top in subsidiaries Revenue businesses, to is card driven card of since real XX.X% and acquisition KRWXXX.X Songpa DIGICO transformation third Y-o-Y into of buoyed Y-o-Y. growth on BC substantial of major earnings HCN declaring posted revenue jumped subsidiaries. Revenue Y-o-Y the jumped KRWXXX.X backed Internet and growth Skylife advertisement to KRWXXX.X post-pandemic Y-o-Y report a rich We and reach revenue Contents the to effect demand. top of Revenue continuously subsidiaries expansion value billion billion, levels. Y-o-Y of

utmost interest We deliver it from visible show Thank profitability stronger full-fledged continued you. making the to of like investors and ask addition to would business In Telco to to BXB business, will growth. results support effort for starts our we be in the analysts. as and DIGICO

details, previously more which please to has refer presentation, been earnings circulated. the For

as We participant. your appreciate X as we you. allow opportunities will questions each many from would order to only now Q&A questions. be Thank taking possible, In

Operator

by The Instructions] be [Operator Jae presented Securities. question Kim from first Hoi will Daishin

Hoi Jae Kim

X Kim is from Daishin name I Securities. My have Hoi-Jae questions.

one-off policy ordinary dividends. it to is XX% the First and that is I understand income related and profit, of dividend excludes items.

lead the StudioGenie What content. by company? the the to those original has provide profitability of related that the content year? And I is been understand of is possible, continue you the content for the also of dividend to this dividend next earnings continued But company that earnings full this that for earnings of policy believe strong, expect related higher dividend the as valid the the also and year. this year be understand like is I year. the very well will the is this I the the title on slot is we time to this only guidance also, So if policy titles titles? can What year for year. when are dividend launched and Will some to the Second can lineup business?

Young Jin Kim

for the you Thank question.

Your next first answer the year. question I question after policy regarding will that to dividend was first.

this you income for – XXXX, dividend net net XXXX. XX% standalone for and be will of will the on maintained a the payout it until basis As policy end know, be of adjusted

the be I dividend working be to think to and return that and historically, senior expectations that, the returns. And enhance we the opinions it a with policy Directors the said shareholders and corporate of investors the the value Having communicate meet the will XXXX. and will and and policy policy XX%. the been have the is this come has been a to dividend Board Directors topic return shareholder company management around can policy have up The bit discussing supporting the shareholder shareholder of Board continuously market. early little after for of continuously for of expectations KT’s of XXXX, considering payout been

guidance this the regarding question the Your for lineup this for for year. was the StudioGenie, performance year second and

year. My For up over Woo content title, more Webtoons, we as than No content are receiving We like the onwards, Woo the enhance on dramas has to have released already to year, expected next the of to which the also appropriate lineup drama titles up confirmed and for Pil-Soo, this next [foreign] have Strange We viewership are quality Partner, be from is we released should planning we Goo verified the XX will reviews and Secret well. release. in Young is After Lawyer, but that based There positive have the been we original increasing to go I titles a the titles have that, recently around think of already that XX that lineup. and released. is to titles is year, coming slate we year this than are event be These a each continuously so those that don’t working more

with XXXX, For generating for of course, the in revenue. performance, lineups, strong the higher we guidance will be

profit be income, operating the of year for company of will in of working value As listing it the also company we are the enhance thinking to we and the well. that continuously as future and to we IPO will this turn believe the

please. question, Next

Operator

The Kim from next question presented by be KB will Joonsop Securities.

Joonsop Kim

is KB My Securities. Kim Joonsop name from

First strong one questions, of the first results other on all, and AI/New the on in congratulations Biz quarter. the have very X on I IDC/Cloud.

AI/New Biz, the launch been of AICC attention mentioned the the and press. headlines call, and on has you on First receiving in previous making AICC,

So be I the that as share it is would performance, better appreciated this changed AICC to and regarding outlook well. you guidance will business, for understand anything previous has call, growth strategy that since your for can there the and if the like if also your

What for more will this area? sustain well. are second supply the question your related strategy this in to therefore, competitors market entering service The is and as and the is to increase growth Cloud. There IDC

Young Jin Kim

Thank AICC first will answer the the Biz. and regarding the for questions. AI/New question I you

the you that the of the able the based this using input of to all, by AI capabilities. to First Korea if in data largest on our look business, has of the AICC automate we and operating were centers KT backdrop at experience, service customer experience

To the with bit contact go AICC for this center call experience So KT’s capabilities. detail, service. is center AI backdrop a the AICC this combines into – more little

that to customer. the is these a services consultations into increasing. chatting customers. platform KRWX best of combine to trillion different and the our can of to AICC size the the single of continuously around customers that up experience provide We messaging, needs able offer for We and believe portion all and enhance contact are We the this integrate CC the portion in this suit is customer and solutions with the our market, Yes. – the virtual form come of packages the cases solutions analyze Telephony’s with can market

We have strategic largely X directions AICC. for

have insurance industry past, presence as distribution business, First, our we been focusing are and but as on and sector finance expanding public the the an infrastructure we in well. the into also

are also operate in for We subscription enterprises. medium planning small the launch this business and sized to and sector

AI we help number to the called our our We will what KT Cloud and be will the and clients. combining a diversify of of larger create CcaaS business services us as secure and model this SMEs

this small and also the the voice AI targeting mom-and-pop has smaller launched and have been We stores secretary SMEs.

our number UI of enhance We larger and have a customer been continuously experience improving customers. to secure

second growth how sustain The was be question will Cloud. we on to able the of IDC and

mentioned In we of in demand market. the supply the transformation increase that You competitors digital about sector, increasing. continuously IDC believe this is the corporate and for

and is supply. situation So the larger in the demand demand market, the than this continuously supply

in Korea, as together in serve in the cloud. the KT First IDC able to players which industry in And been getting be have operator XXXX, strength KT in of centers working are cloud only we been center this have all, after [Gcloud] the network, with and penetrate the better to market, to to of top XX country. the to Korea data is the we our certification, sector. combine we clients. key public able aggressively operates And largest

demand infrastructure. For #X on we for the this are are market stable the the are add example, consulting can to customer we changes XXX-megawatts, that along player. To To are Cloud the and and Korea, solidify this flexibly in internal cooperation sector, planning Megazone with #X cloud to as establish market in to we that with operator, the to to combine partnerships so skyrocketing efforts leverage MSP our and our of respond our focusing respond leadership base able cooperating in we services. and we with operation capabilities their IDCs

please. question, Next

Operator

will The next Jae-Min be NH from Investment & by Securities. Ahn question presented

Jae-min Ahn

Ahn My Jae-Min name Investment is from NH & Securities.

first half, First believe will stabilized in in their for this second the and the first in the was higher QX. a tends first We the in makers and the in the second the half for has continue wireless I device launch half. the question if expense Also, expense thank outstanding that to usually all, QX congratulations you expense largely was handsets. flagship if marketing very sorry, trend But of the in lower the it is the see when past, in have expense -- higher marketing results I quarter. regarding the the half be major business.

in So would like for that, your relation to outlook marketing this the I to expense for understand for business. wireless year

Young Jin Kim

year. in QX for question volume expense of Yes. to openings full – wireless Thank showed on for was question. trend the amortization your in stabilizing of and your The been some as one reduction has the total and new marketing was has why marketing related that And declined the you the because the reasons there expense well. the depreciation

to stabilize that result slightly the can be manner. volume, year cost than to or market reduce So, to to higher the targeting expense similar as device in light will marketing full also be customers. efficiently maintain slightly our our pandemic marketing some But year coming new the limit to and of also second light to the for can for of the can some efforts in the in there you less be is or working expense XXXX, mentioned, expense efficient the market in or we marketing be we an to and utmost marketing overall half, the last of in to growth premium the make the outlook competition previous year. an execute for effort maintain overall, plan cost, efforts efforts releases flagship and Like there compared end the to manage

Operator

Currently, there are no questions. participants with

another question. is a will We for there wait until second

Young Jin Kim

today's the your Thank KT. schedule. once in are questions interest there you attending busy will no call If Thank despite you we more again for your for and earnings session. conclude Q&A questions,

the the of earnings conclude quarter will KT XXXX. of call We first for

Seung Hoon Chi	Investor Relations Officer
Young Jin Kim	Chief Financial Officer
Hoi Jae Kim	Daishin Securities
Joonsop Kim	KB Securities
Jae-Min Ahn	NH Investment & Securities

KT (KT) 13 May 222022 Q1 Earnings call transcript