DIGICO Progressing Smoothly
The author is an analyst of KB Securities. He can be reached at joonsop.analyst@kbfg.com. -- Ed.
2Q22 review: OP of KRW459.2bn (-3.5% YoY) meets KB estimate, market consensus
— KT posted 2Q22 consolidated revenue of KRW6.31tn (+4.7% YoY) and OP of KRW459.2bn (-3.5% YoY), both meeting the market consensus and our estimates.
— While revenue rose on KT Group’s growth portfolio, OP fell on one-off costs totaling KRW40.0bn (incl. labor costs).
— 1H22 DIGICO B2B order wins reached KRW1.9tn (+33% YoY), which lifted the business’ 1H22 standalone revenue by 5.5% YoY to KRW2.1tn.
— NP came in at KRW313.1bn, missing the market consensus by 10% because of deferred taxes linked to the KT Cloud spin-off.
DIGICO progressing smoothly
— 2Q22 standalone DIGICO B2B revenue (incl. subsidiary KT Cloud) jumped to KRW578.6bn (+17.4% YoY).
— Cloud/IDC revenue increased 11.4% YoY. AI/new biz revenue (incl. AICC, smart mobility) climbed 12.9% YoY. ICT enterprise DX revenue surged 48.1% YoY.
— 2Q22 standalone DIGICO B2C revenue gained 2.0% YoY to reach KRW554.4bn, helped by growth at the IPTV media platform and mobile platforms (e.g., finance platform).
Increase in no. of 5G subscribers
— Cumulative no. of 5G subscribers reached 7.48mn as of 2Q22 (350,000 net increase). As a result, wireless ARPU rose 3.2% YoY to KRW32,446.
— Fixed-line internet revenue rose 2.5% YoY to KRW596.3bn, with no. of subscribers up 2.7%.
— KT’s standalone SG&A grew 2.4% YoY to KRW657.4bn.