SK Telecom's net income climbs 12%, but op. profit down 6%

29 Oct 2008

SK Telecom's net income climbed 12% quarter-on-quarter for Q3 to reach 333.6 billion won ($227.1 million), despite a 6% drop in operating profit.

While the company's net income plunged 57% on a year-on-year basis, this is because in Q3 2007 SK Telecom earned significant one-time gains from the conversion of China Unicom' convertible bonds into full shares. Barring these one-time gains, revenue increased 6% year-on-year.

But the result was still below market expectations. According to Bloomberg statistics, analysts had been expecting a net income of around $240.8 million.

SK's earning potential was hampered by the rising cost of foreign debt, as well as a decrease in the rate of new subscribers.

That said, the company increased its subscriber base by 5.9% year-on-year, and by 0.6% quarter-on-quarter. The company now boasts 22.87 million total subscribers.

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