SKT posts record revenue in Q4

By Kim Yoo-chul

SK Telecom, the nation’s top mobile carrier, reported record revenue for 2012 as its drive to entice customers to long-term evolution (LTE) mobile devices strengthened its bottom line.

In a regulatory filing to the Korea Exchange (KRX), the company posted 16.30 trillion won in revenue last year, up 2.3 percent from 2011.

Its operating profit, however, fell by 23.3 percent to 1.76 trillion won due to heavy spending on LTE. It posted a net profit of 1.11 trillion won, down 29 percent from the year before.

``Despite mobile rate cuts and cutthroat competition, we fared well backed by our strengthened leadership in LTE, growth of the firm’s B2B business and strong performance of affiliates including SK Broadband and SK Planet,’’ the company said in a statement, Tuesday.

The nation’s three carriers ― KT and LG Uplus are the other two ― are competing for a bigger stake in the growing LTE market. SK Telecom is currently Korea’s biggest LTE operator in terms of subscriber base. As of the end of December 12, it had 7.53 million for the advanced service.

For the fourth quarter alone, it said net profit more than doubled after selling real estate and a stake in steelmaker POSCO.

Net income during the last three months of 2012 rose to 519 billion won from 195.5 billion year-on-year. SK raised 727 billion won selling property and about 1 percent of POSCO to support its LTE network.

``SK Telecom is being aggressive in promotional campaigns to lure more LTE customers. However, we still believe the firm’s financial soundness is stable, which is enough to offset any market challenges,’’ said HMC Investment Securities analyst Hwang Sung-jin.

It identified network operation, media, healthcare and solution businesses as the company’s next growth sectors.

``We will stay away from cash-burning competition with our two rivals who offer large handset subsidies,’’ said a company spokeswoman.

The three carriers are expected to cut marketing spending this year as the telecom regulator plans to fine them additionally over the continued provision of illegal subsidies despite prior warnings.

The regulator fined SK Telecom 6.9 billion won and banned it from signing up new customers for 22 days starting January 31. KT and Uplus were also penalized in a similar manner.