Do not go gentle into that good night, old age should burn and rave at close of day; Rage, rage against the dying of the light, though wise men at their end know dark is right, because their words had forked no lightning they, do not go gentle into that good night.
Kakao expected to post surging earnings in 2nd half
Kakao Chairman Kim Beom-soo
By Jhoo Dong-chan
By Jhoo Dong-chan
Kakao, operator of the nation's most widely used messenger app KakaoTalk, is expected to post strong earnings in the second half of the year thanks to the introduction of its new mobile advertising service in the third quarter, market analysts and brokerages said Friday.
According to online market research service provider FnGuide, market consensus among domestic securities firms shows that Kakao will post a 95.1 billion won ($82.1 million) operating profit in the second half of the year, up 171.9 percent from a year ago.
The firm suffered a 21.3 billion won net loss in the second half of last year, but is expected to mark a 63.9 billion won net profit in the second half of 2019.
Kakao said it posted a 27.7 billion won operating profit in the first quarter of the year, up 166 percent from a year ago. Sales were 706.3 billion won in the period, continuing its record-breaking streak for eight consecutive quarters.
The firm's strong presence in the nation's platform and content market is believed to lead the momentum, and experts said Kakao's uptrend is likely to continue throughout the year.
“Kakao Bank's earnings have steadily displayed an upward trend this year. Kakao also managed to overcome a hurdle to become its banking subsidiary's largest shareholder,” said KB Securities analyst Kim Ji-soo.
“It will also introduce a new mobile advertising service via its KakaoTalk app in the third quarter. It will continuously boost its stock price,”
Meritz Securities Researcher Kim Dong-hee agreed.
“Kakao Biz Board will lead Kakao's surging earnings in the second half,” Kim said.
“Users were much more accepting than anticipated. The service will target all KakaoTalk users.”
Separate from the introduction of the new mobile advertising Kakao Biz Board, Kakao got a step closer to becoming the largest shareholder of its internet-only bank subsidiary Kakao Bank as a government decision has cleared away some legal hurdles, which many expect will provide the impetus for earnings growth in the second half.
Kakao submitted an application to the Financial Services Commission to become Kakao Bank's largest shareholder in April as lawmakers last year eased related internet-only bank laws prohibiting non-financial firms from owning more than a 10 percent stake in a financial firm.
Its plan, however, faced an unexpected snag as the firm's Chairman Kim Beom-soo was summarily indicted for neglecting a disclosure obligation regarding Kakao's five affiliate companies.
Under the eased laws regarding internet-only banks, major non-financial shareholders seeking to own more than a 10 percent stake in an internet-only bank should not be subject to punishment heavier than a monetary penalty for violating the Fair Trade Act, tax and special economic laws over the past five years.
The Ministry of Government Legislation ruled, however, that Kakao was still eligible to become the largest shareholder of its internet-only bank regardless of Kim's actions.