South Korean communications provider SK Telecom posted second-quarter net profit of KRW 468 billion, up 288 percent from KRW 121 billion in the same period a year ago, as positive earnings from SK Hynix contributed KRW 197 billion to pre-tax profits.
Operating revenues amounted to KRW 4.2 trillion, an increase of 3.9 percent from the same period last year. The increase was led by the growth of LTE subscribers and new businesses including B2B services. Mobile service revenue increased 4.5 percent year-on-year to KRW 2.8 trillion, while interconnection revenues decreased 18 percent year-on-year to KRW 217 billion resulting from the adoption of lower interconnection rates and new business, and other revenues increased 48 percent year-on-year to KRW 205 billion.
Operating income increased 33.2 percent year-on-year to KRW 553.4 billion. EBITDA jumped 23.5 percent to KRW 1.3 trillion, while the EBITDA margin grew to 30.3 percent from 25.5 percent in Q2 2012. Capex fell to KRW 293 billion in Q2 from KRW 616 billion.
For Q2, billing ARPU increased 3.3 percent year-on-year, as the growth of LTE subscribers outpaced the dampening effect resulting from the adoption of unlimited voice price plans. SK Telecom added 110,000 new subscribers in the quarter, to bring its total to 27.14 million. Of the total, 17.29 million are smartphone subscribers, and the total also includes 11.02 million LTE subscribers. Moreover, the company has already attracted around 300,000 LTE-Advanced subscribers within a month of launching the service on 26 June. The churn rate dropped to 2.3 percent in Q2 as a result of the company’s focus on retention-oriented marketing. Within the end of this year, SK Telecom plans to further expand its LTE-Advanced coverage by deploying a total of 32,000 units of base stations, which will also cover 300 university areas.
In the meantime, SK Telecom's mobile business SK Planet’s revenue increased by 33 percent year-on-year due to synergies generated from its merger with SK M&C. the company is strengthening its competitiveness in web-mobile commerce business through 11st and OK Cashbag, and is expected to expand its business to the overseas markets like Turkey and Indonesia.
