SK Telecom 2012 profit falls 29.5%

Dylan Bushell-Embling
05 Feb 2013
Daily News

SK Telecom has reported a 29.5% slump in 2012 net profit to 1.12 trillion won ($1.02 billion), due in large part to rising LTE rollout and marketing costs.

The South Korean incumbent posted a revenue for the year of 16.3 trillion won, up 2.3% from 2011.

But operating revenue fell 23.3% to 1.76 trillion won, in a result blamed on factors including increasing LTE marketing expenses and infrastructure costs.

Capex increased 25.5% to 2.86 trillion won, as the operator spent heavily on a nationwide LTE rollout and network upgrades.

The good news is that the bulk of the initial rollout costs may be behind SK Telecom. In an indication of this, the company's operating income for the fourth quarter grew by 81.1% sequentially, and its net income surged by over 195% over the same period.

SK Telecom ended 2012 with 7.53 million LTE subscribers, exceeding its target of 7 million. Total subscriber figures grew to 26.9 million, although net additions for the year more than halved to 409,000. Monthly churn fell to 2.6% from 2.7%.

Total smartphone subscribers surged to 15.9 million - or 59.3% of the operator's customer base - from 11 million and 41.7% in 2011.

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