6-K 1 d6k.htm FORM 6-K Form 6-K

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF

THE SECURITIES EXCHANGE ACT OF 1934

For the month of April 2008

Commission File Number 1-14926

 

 

KT Corporation

(Translation of registrant’s name into English)

 

 

206 Jungja-dong

Bundang-gu, Sungnam

Kyunggi-do

463-711

Korea

(Address of principal executive offices)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F      Ö            Form 40-F              

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):             

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):             

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes                      No      Ö    

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-             

 

 

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Dated: April 25, 2008
KT Corporation
By:  

/s/ Thomas Bum Joon Kim

Name:   Thomas Bum Joon Kim
Title:   Managing Director
By:  

/s/ Youngwoo Kim

Name:   Youngwoo Kim
Title:   Director

April 25, 2008

LOGO

1st Quarter 2008

Preliminary Earnings Commentary

(KRX : 030200 / NYSE : KTC)

LOGO        

 

Disclaimer

This material contains estimated information of unaudited non-consolidated preliminary financial and operating data of KT Corporation (“KT” or “the company”) for year 2008 first quarter and forward-looking statements with respect to the financial condition, results of operations and business of KT. Statements that are not historical facts, including statements about KT’s beliefs and expectations, are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other future results or performance expressed or implied by such forward-looking statements. Such forward-looking statements were based on current plans, estimates and perfections of KT and the political and economic environment in which KT will operate in the future and therefore you should not place undue reliance on them.

Therefore, KT does not make any representation or warranty, expressed or implied, as to the accuracy or completeness of the unaudited financial and operating data contained in this material and such information maybe materially different from the actual results or performance of KT. KT speaks only as of the date it is made, and KT undertakes no obligation to update publicly any of them in light of new information or future events.

The financial and operating data contained in this presentation have been rounded. Since affiliated companies have not finished accounting, estimated figures were used for the equity method gains/losses.

KT’s non-consolidated financial statements and report for 2008 1st quarter will be filed with the Financial Supervisory Service(FSS) and the Korea Exchange (KRX) in May 15, 2008.

If you have any questions in connection with the preliminary earnings, please contact Investor Relations Department of KT.

Tel : 82-31-727-0950~59

Fax : 82-31-727-0949

E-mail: ir@kt.com

Note :

As of February 22, 2008, following amendments of the Korean accounting standards Art.15(equity method), we have retroactively applied goodwill and equity method capital adjustments resulting from additional stake acquisition of subsidiaries on capital surplus. Details are as follow:

 

  - Reversion of past amortization : 1) Retained earnings was increased, which was previously decreased due to amortization of goodwill and 2) capital surplus was increased
  - Exclusion of unamortized amount : Capital surplus and investment securities

 

1

LOGO        

 

1. Financial Highlights

A. Summary of Income Statement

 

(KRW bn)

    2008
1Q		     2007
4Q		     QoQ     2007
1Q		     YoY     2008
Cumm.		  
       Amount    r%       Amount    r%    

OPERATING REVENUES

    2,967.0     2,996.3     -29.3    -1.0 %   2,972.4     -5.4    -0.2 %   2,967.0  

¨ Internet access

    528.1     533.2     -5.0    -0.9 %   526.1     2.0    0.4 %   528.1  

¨ Internet application

    106.9     95.3     11.6    12.2 %   91.3     15.7    17.2 %   106.9  

¨ Data

    402.4     408.3     -5.9    -1.4 %   406.9     -4.5    -1.1 %   402.4  

¨ Telephone

    1,023.2     1,064.4     -41.3    -3.9 %   1,056.5     -33.3    -3.2 %   1,023.2  

¨ LM

    364.1     392.1     -28.0    -7.1 %   411.9     -47.8    -11.6 %   364.1  

¨ Wireless

    419.9     368.2     51.7    14.0 %   380.4     39.5    10.4 %   419.9  

¨ Real estate

    58.7     50.3     8.4    16.7 %   45.9     12.9    28.0 %   58.7  

¨ Others

    63.6     84.5     -20.9    -24.8 %   53.4     10.2    19.1 %   63.6  

 SI

    52.1     70.7     -18.6    -26.3 %   44.6     7.5    16.9 %   52.1  

OPERATING EXPENSES

    2,634.0     2,812.6     -178.6    -6.4 %   2,443.2     190.7    7.8 %   2,634.0  

¨ Labor

    683.3     648.3     35.0    5.4 %   653.2     30.1    4.6 %   683.3  

¨ Commissions

    170.9     196.0     -25.2    -12.8 %   153.0     17.9    11.7 %   170.9  

¨ Sales commission

    230.1     181.5     48.6    26.8 %   141.0     89.1    63.2 %   230.1  

¨ Sales promotion

    79.3     58.0     21.3    36.7 %   50.2     29.1    58.0 %   79.3  

¨ Advertising

    16.9     42.2     -25.2    -59.8 %   20.6     -3.6    -17.6 %   16.9  

¨ Provision for doubtful accounts

    6.9     12.8     -6.0    -46.6 %   20.2     -13.4    -66.1 %   6.9  

¨ Depreciation

    482.3     623.5     -141.1    -22.6 %   477.3     5.0    1.0 %   482.3  

¨ Repairs & maintenance

    22.0     69.9     -47.9    -68.5 %   25.6     -3.5    -13.9 %   22.0  

¨ Cost of goods sold

    157.3     142.4     14.8    10.4 %   182.3     -25.1    -13.7 %   157.3  

¨ Cost of service provided

    476.8     508.7     -31.9    -6.3 %   442.9     33.9    7.7 %   476.8  

¨ R&D

    56.8     88.9     -32.1    -36.1 %   53.8     3.0    5.6 %   56.8  

¨ Activation/installation and A/S cost

    96.5     92.8     3.7    0.0     75.8     20.7    0.3     96.5  

¨ Others

    154.9     147.5     7.3    5.0 %   147.4     7.5    5.1 %   154.9  

OPERATING INCOME

    333.0     183.8     149.3    81.2 %   529.1     -196.1    -37.1 %   333.0  

Operating margin

    11.2 %   6.1 %       5.1% P     17.8 %       -6.6% P     11.2 %

EBITDA(1)

    815.4     807.2     8.1    1.0 %   1,006.5     -191.1    -19.0 %   815.4  

EBITDA margin

    27.5 %   26.9 %       0.5% P     33.9 %       -6.4% P     27.5 %

Non-operating income

    134.3     77.9     56.4    72.4 %   146.6     -12.2    -8.3 %   134.3  

Non-operating expenses

    269.6     178.1     91.6    51.4 %   144.2     125.4    87.0 %   269.6  

INCOME BEFORE INCOME TAXES

    197.8     83.6     114.1    136.5 %   531.5     -333.7    -62.8 %   197.8  

Income tax expenses

    43.7     -21.2     64.9    N/A     144.2     -100.5    -69.7 %   43.7  

Effective tax rate

    22.1 %   -25.4 %       N/A     27.1 %       -5.0% P     22.1 %

NET INCOME

    154.1     104.9     49.2    46.9 %   387.3     -233.2    -60.2 %   154.1  

EPS(2) (won)

    756     1,070     -314    -29.3 %   1,528     -772    -50.5 %   756  

 

(1) EBITDA = Operating income + depreciation
(2) EPS = Net income ÷ Weighted average of no. of shares outstanding

 

 Revenue

 

  - YoY and QoQ decrease was due to decline in telephone and LM revenue.

 

 Operating Income

 

  - Rise in labor, commissions, sales promotion and other costs led to a YoY decrease in operating income.

 

  - QoQ increase mainly due to decline in depreciation and repairs and maintenance.

 

2

LOGO        

 

B. Summary of Balance Sheet

 

(KRW bn)

    2008
1Q		     2007
4Q		     QoQ     2007
1Q		     YoY  
       Amount    r%       Amount    r%  

TOTAL ASSETS

    17,596.1     17,917.2     -321.1    -1.8 %   17,746.1     -150.0    -0.8 %

¨ Current assets

    3,058.7     3,310.4     -251.7    -7.6 %   3,311.0     -252.3    -7.6 %

 Quick assets

    2,953.5     3,188.3     -234.8    -7.4 %   3,205.3     -251.8    -7.9 %

- Cash & Cash equivalents

    884.5     1,229.2     -344.7    -28.0 %   1,358.8     -474.2    -34.9 %

 Inventories

    105.2     122.1     -16.9    -13.8 %   105.7     -0.5    -0.5 %

¨ Non-current assets

    14,537.4     14,606.8     -69.4    -0.5 %   14,435.0     102.4    0.7 %

 Investments and other non-current assets

    3,753.8     3,718.4     35.4    1.0 %   3,776.5     -22.7    -0.6 %

- KTF shares

    2,595.4     2,620.2     -24.8    -0.9 %   2,700.0     -104.6    -3.9 %

- Long-term loans

    39.8     66.3     -26.4    -39.9 %   154.5     -114.7    -74.2 %

- Others

    1,118.5     1,032.0     86.6    8.4 %   922.0     196.6    21.3 %

 Tangible assets

    10,371.0     10,448.6     -77.7    -0.7 %   10,205.8     165.2    1.6 %

 Intangible assets

    412.6     439.7     -27.1    -6.2 %   452.8     -40.1    -8.9 %

TOTAL LIABILITIES

    8,983.8     9,057.3     -73.4    -0.8 %   9,236.7     -252.9    -2.7 %

¨ Current liabilities

    2,455.7     2,991.3     -535.7    -17.9 %   3,289.3     -833.6    -25.3 %

 Interest-bearing debts

    235.1     438.0     -202.9    -46.3 %   912.2     -677.1    -74.2 %

 Accounts payable

    664.0     769.9     -105.8    -13.7 %   605.1     58.9    9.7 %

 Others

    1,556.5     1,783.5     -226.9    -12.7 %   1,772.0     -215.5    -12.2 %

¨ Non-current liabilities

    6,528.2     6,065.9     462.2    7.6 %   5,947.4     580.8    9.8 %

 Interest-bearing debts

    5,104.6     4,643.9     460.7    9.9 %   4,537.1     567.5    12.5 %

 Installation deposit

    833.1     841.4     -8.3    -1.0 %   893.9     -60.8    -6.8 %

 Others

    590.5     580.7     9.8    1.7 %   516.4     74.1    14.4 %

TOTAL STOCKHOLDERS’ EQUITY

    8,612.3     8,859.9     -247.6    -2.8 %   8,509.4     102.9    1.2 %

¨ Common stock

    1,561.0     1,561.0     0.0    0.0 %   1,561.0     0.0    0.0 %

¨ Capital surplus

    1,276.7     1,278.6     -1.8    -0.1 %   1,440.9     -164.2    -11.4 %

¨ Retained earnings

    9,592.2     9,842.9     -250.7    -2.5 %   9,315.4     276.8    3.0 %

¨ Capital adjustments

    -3,815.8     -3,815.8     0.0    N/A     -3,816.7     0.9    N/A  

 Treasury stock

    -3,824.9     -3,825.7     0.8    N/A     -3,825.7     0.8    N/A  

 Gain(loss) on valuation of investment securities

    10.6     11.4     -0.9    -7.6 %   15.6     -5.1    -32.4 %

 Others

    -1.5     -1.5     0.1    N/A     -6.6     5.2    N/A  

¨ Others

    -1.9     -6.8     4.9    N/A     8.8     -10.7    N/A  

Total interest-bearing debt

    5,339.7     5,081.9     257.8    5.1 %   5,449.3     -109.6    -2.0 %

Net debt

    4,455.2     3,852.7     602.4    15.6 %   4,090.5     364.6    8.9 %

Net debt / Total shareholders’ equity

    51.7 %   43.5 %     8.2% P     48.1 %     3.7% P  

 

 Assets

 

  - Decrease in YoY net income resulted in a decline in cash and cash equivalents.

 

 Liabilities

 

  - YoY and QoQ increase in non-current liabilities due to 1) issuance of bonds and 2) loss on foreign currency bonds appraisal affected by the rise in exchange rates.

 

 Stockholders’ Equity

 

  - Capital surplus and retained earnings were adjusted following changes in accounting standards related to equity method.

 

3

LOGO        

 

2. Operating Results

A. Internet Revenue

 

(KRW bn)

    2008
1Q		    2007
4Q		    QoQ     2007
1Q		    YoY     2008
Cumm.
         Amount    r%        Amount    r%    

Internet access

    528.1    533.2    -5.0    -0.9 %   526.1    2.0    0.4 %   528.1

¨ Broadband

    527.5    532.5    -5.0    -0.9 %   525.8    1.7    0.3 %   527.5

 Megapass

    501.1    506.5    -5.4    -1.1 %   513.6    -12.5    -2.4 %   501.1

 Nespot

    8.5    9.0    -0.5    -5.9 %   11.7    -3.2    -27.6 %   8.5

 WiBro

    17.9    17.0    0.9    5.5 %   0.5    17.4    3390.8 %   17.9

¨ Others

    0.7    0.7    0.0    0.8 %   0.3    0.3    99.8 %   0.7

Internet application

    106.9    95.3    11.6    12.2 %   91.3    15.7    17.2 %   106.9

¨ IDC

    48.9    50.6    -1.7    -3.4 %   45.4    3.4    7.6 %   48.9

¨ Bizmeka

    36.7    28.0    8.7    31.2 %   26.4    10.2    38.7 %   36.7

¨ Mega TV

    5.0    1.9    3.1    1.6     5.6    -0.5    -0.1     5.0

¨ Others

    16.3    14.9    1.5    9.8 %   13.8    2.5    18.2 %   16.3

 

 Megapass

 

  - QoQ and YoY decrease in revenue from discounts and modem rental fee expiration for long-term customers.

 

 Internet application

 

  - QoQ increase from rise in sales of MegaTV and Bizmeka.

 

  - YoY increase in revenue due to rise in demand for IDC and Bizmeka.

B. Data Revenue

 

(KRW bn)

    2008
1Q		    2007
4Q		    QoQ     2007
1Q		    YoY     2008
Cumm.
         Amount    r%        Amount    r%    

Data

    402.4    408.3    -5.9    -1.4 %   406.9    -4.5    -1.1 %   402.4

¨ Leased line

    268.3    277.4    -9.1    -3.3 %   275.8    -7.6    -2.7 %   268.3

 Local

    116.8    118.3    -1.5    -1.3 %   118.0    -1.2    -1.0 %   116.8

 Domestic long distance

    80.2    83.3    -3.2    -3.8 %   84.0    -3.8    -4.6 %   80.2

 International long distance

    5.0    7.1    -2.1    -29.4 %   4.2    0.8    18.7 %   5.0

 Broadcasting & others

    66.2    68.6    -2.3    -3.4 %   69.6    -3.3    -4.8 %   66.2

¨ Data leased line

    37.8    35.7    2.1    5.9 %   32.5    5.3    16.2 %   37.8

 Packet data

    1.6    1.7    -0.1    -7.6 %   2.1    -0.5    -25.1 %   1.6

 National network ATM

    20.7    19.8    0.9    4.3 %   17.8    2.9    16.5 %   20.7

 VPN

    15.4    14.1    1.4    9.8 %   12.6    2.9    22.8 %   15.4

¨ Kornet

    62.9    61.4    1.5    2.5 %   65.6    -2.7    -4.1 %   62.9

¨ Satellite

    26.0    25.3    0.7    2.7 %   27.2    -1.3    -4.7 %   26.0

¨ Others

    7.5    8.6    -1.1    -13.0 %   5.8    1.7    29.5 %   7.5

 

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C. Telephone Revenue

 

(KRW bn)

    2008
1Q		    2007
4Q		    QoQ     2007
1Q		    YoY     2008
Cumm.
         Amount    r%        Amount    r%    

Telephone revenue

    1,023.2    1,064.4    -41.3    -3.9 %   1,056.5    -33.3    -3.2 %   1,023.2

¨ Subscriber connection

    340.3    344.9    -4.7    -1.3 %   349.4    -9.1    -2.6 %   340.3

 Subscription fee

    9.2    10.5    -1.3    -12.3 %   11.1    -1.9    -17.2 %   9.2

 Basic monthly fee

    270.1    272.4    -2.3    -0.9 %   276.6    -6.6    -2.4 %   270.1

 Installlation

    7.9    8.7    -0.8    -9.2 %   8.9    -1.0    -11.5 %   7.9

 Interconnection

    53.1    53.4    -0.2    -0.4 %   52.7    0.4    0.8 %   53.1

¨ Local

    224.2    228.1    -3.9    -1.7 %   243.2    -19.0    -7.8 %   224.2

 Usage

    147.5    151.9    -4.5    -2.9 %   164.6    -17.2    -10.4 %   147.5

 Interconnection

    23.8    23.8    0.1    0.3 %   26.8    -2.9    -11.0 %   23.8

 Others

    52.9    52.4    0.5    0.9 %   51.8    1.1    2.1 %   52.9

¨ Domestic long distance

    152.2    159.8    -7.7    -4.8 %   166.4    -14.3    -8.6 %   152.2

 Usage

    142.6    150.6    -8.0    -5.3 %   159.9    -17.3    -10.8 %   142.6

 Interconnection

    9.0    9.0    0.1    0.7 %   6.3    2.7    43.3 %   9.0

 Others

    0.5    0.3    0.2    78.7 %   0.2    0.3    129.8 %   0.5

¨ International long distance

    46.9    44.5    2.4    5.4 %   51.8    -4.8    -9.3 %   46.9

¨ International settlement

    49.7    47.1    2.6    5.5 %   42.9    6.8    15.8 %   49.7

¨ VoIP

    10.2    9.1    1.1    12.1 %   7.6    2.6    33.9 %   10.2

¨ VAS

    93.4    98.7    -5.3    -5.4 %   94.4    -1.0    -1.1 %   93.4

¨ Public telephone

    10.6    14.1    -3.4    -24.5 %   14.8    -4.1    -28.1 %   10.6

¨ 114 phone directory service

    32.1    28.5    3.5    12.4 %   31.1    1.0    3.2 %   32.1

¨ Others

    63.6    89.5    -25.9    -28.9 %   54.9    8.7    15.9 %   63.6

 

 Local, DLD

 

  - QoQ and YoY decline in revenue from fall in subscribers and call traffic.

 

 International settlement

 

  - QoQ and YoY increase due to rise in international call traffic.

 

 Others

 

  - QoQ decrease was due to rise in revenue affected by a temporary increase in international ISDN demand in the previous quarter.

 

5

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D. LM(Land to Mobile) Interconnection Revenue

 

(KRW bn)

    2008
1Q		    2007
4Q		    QoQ     2007
1Q		    YoY     2008
Cumm.
         Amount    r%        Amount    r%    

LM Revenue

    364.1    392.1    -28.0    -7.1 %   411.9    -47.8    -11.6 %   364.1

LM interconnection cost

    184.5    206.2    -21.7    -10.5 %   200.7    -16.2    -8.1 %   184.5

 

 LM Revenue

 

  - QoQ and YoY decline due to decrease in subscribers and call traffic.

 

 LM Interconnection cost

 

  - It takes approximately two months for operators to verify the actual volume of LM traffic. Thus figures for 2 months of every quarter are based on estimation, resulting in disparity with actual call traffic.

E. Wireless Revenue

 

(KRW bn)

    2008
1Q		    2007
4Q		    QoQ     2007
1Q		    YoY     2008
Cumm.
         Amount    r%        Amount    r%    

Wireless revenue

    419.9    368.2    51.7    14.0 %   380.4    39.5    10.4 %   419.9

¨ PCS resale

    418.2    364.9    53.3    14.6 %   363.4    54.8    15.1 %   418.2

 PCS service

    254.4    255.6    -1.3    -0.5 %   229.4    24.9    10.9 %   254.4

 Handset sales

    163.9    109.3    54.6    50.0 %   134.0    29.9    22.3 %   163.9

¨ Others

    1.7    3.3    -1.6    -49.6 %   16.9    -15.3    -90.2 %   1.7

 

 Wireless revenue

 

  - QoQ and YoY increase due to rise in PCS service and handset sales.

 

6

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F. Operating Expenses

 

(KRW bn)

    2008
1Q		    2007
4Q		    QoQ     2007
1Q		    YoY     2008
Cumm.
         Amount    r%        Amount    r%    

Labor

    683.3    648.3    35.0    5.4 %   653.2    30.1    4.6 %   683.3

¨ Salaries & wages

    476.8    461.2    15.7    3.4 %   438.3    38.5    8.8 %   476.8

¨ Employee benefits

    108.5    118.7    -10.2    -8.6 %   109.5    -1.0    -0.9 %   108.5

¨ Provision for retirement

    98.0    68.5    29.5    43.1 %   105.4    -7.4    -7.0 %   98.0

Commissions

    170.9    196.0    -25.2    -12.8 %   153.0    17.9    11.7 %   170.9

Marketing expenses

    326.3    281.7    44.7    15.9 %   211.7    114.6    54.1 %   326.3

¨ Sales commission

    230.1    181.5    48.6    26.8 %   141.0    89.1    63.2 %   230.1

¨ Sales promotion

    79.3    58.0    21.3    36.7 %   50.2    29.1    58.0 %   79.3

¨ Advertising

    16.9    42.2    -25.2    -59.8 %   20.6    -3.6    -17.6 %   16.9

Provision for doubtful accounts

    6.9    12.8    -6.0    -46.6 %   20.2    -13.4    -66.1 %   6.9

Depreciation

    482.3    623.5    -141.1    -22.6 %   477.3    5.0    1.0 %   482.3

Repairs and Maintenance

    22.0    69.9    -47.9    -68.5 %   25.6    -3.5    -13.9 %   22.0

Cost of goods sold

    157.3    142.4    14.8    10.4 %   182.3    -25.1    -13.7 %   157.3

¨ PCS handset cost

    160.6    122.9    37.7    30.7 %   145.2    15.4    10.6 %   160.6

¨ PDA, WLAN card, others

    -3.3    19.6    -22.9    N/A     37.1    -40.5    N/A     -3.3

Cost of service provided

    476.8    508.7    -31.9    -6.3 %   442.9    33.9    7.7 %   476.8

¨ Cost of service

    226.5    240.3    -13.8    -5.7 %   193.2    33.4    17.3 %   226.5

 PCS resale network cost to KTF

    128.8    132.7    -3.9    -2.9 %   113.1    15.7    13.9 %   128.8

 SI service cost

    53.9    73.1    -19.2    -26.3 %   42.8    11.1    25.9 %   53.9

 Others

    43.8    34.5    9.4    27.1 %   37.3    6.6    17.6 %   43.8

¨ International settlement cost

    59.3    57.0    2.3    4.1 %   45.8    13.4    29.3 %   59.3

¨ LM interconnection cost

    184.5    206.2    -21.7    -10.5 %   200.7    -16.2    -8.1 %   184.5

¨ Others

    6.5    5.3    1.3    23.8 %   3.2    3.3    104.9 %   6.5

R&D

    56.8    88.9    -32.1    -36.1 %   53.8    3.0    5.6 %   56.8

Activation/installation and A/S cost

    96.5    92.8    3.7    0.0     75.8    20.7    0.3     96.5

Others

    154.9    147.5    7.3    5.0 %   147.4    7.5    5.1 %   154.9

CAPEX*

    285.0    869.7    -584.7    -67.2 %   280.5    4.5    1.6 %   285.0

 

 Labor

 

  - QoQ and YoY increase mainly due to rise in paygrade and a 2.6% salary increase as a result of wage negotiations in previous year.

 

 Marketing expenses

 

  - QoQ and YoY increase due to heightened competition in both wireless and internet markets and new businesses promotion costs.

 

 COGS

 

  - Rise in QoQ COGS due to increased PCS subscribers and PCS hanset costs.

 

 Cost of service provided

 

  - QoQ decrease mainly due to 1) drop in SI service costs and 2) decrease in LM interconnection costs.

 

  - YoY increase was due to 1) rise in PCS resale network costs and 2) rise in international settlement costs.

 

 Activation/installation and A/S cost

 

  - From 2008 installation and A/S cost, which was previously included in Others, will be provided separately.

 

7

LOGO        

G. Non-operating Income

 

(KRW bn)

    2008
1Q		    2007
4Q		    QoQ     2007
1Q		    YoY     2008
Cumm.
         Amount    r%        Amount    r%    

Non-operating income

    134.3    77.9    56.4    72.4 %   146.6    -12.2    -8.3 %   134.3

¨ Gains on disposition of investments

    0.0    2.2    -2.2    N/A     0.0    0.0    N/A     0.0

¨ Gains on disposition of tangible assets

    0.4    1.7    -1.2    -73.6 %   7.0    -6.6    -93.8 %   0.4

¨ Interest income

    18.2    41.9    -23.7    -56.6 %   20.1    -1.9    -9.6 %   18.2

¨ FX transaction gain

    6.3    1.5    4.9    328.9 %   0.9    5.4    590.8 %   6.3

¨ FX translation gain

    11.0    -12.3    23.2    N/A     2.2    8.8    394.8 %   11.0

¨ Gain on equity method

    19.1    15.3    3.7    24.5 %   27.0    -7.9    -29.3 %   19.1

¨ Others

    79.3    27.6    51.7    187.3 %   89.3    -10.0    -11.2 %   79.3

 

 Interest gain

 

  - Decrease in cash and cash equivalents resulted in decrease in interest gain.

 

 Others

 

  - YoY decrease due to temporary rise in gain on return of allowance for liabilities.

 

  - QoQ increase due to 1) rise in gain on appraisal of derivatives and 2) increase in gain on return of allowance for liabilities.

H. Non-operating Expenses

 

(KRW bn)

    2008
1Q		    2007
4Q		    QoQ     2007
1Q		    YoY     2008
Cumm.
         Amount    r%        Amount    r%    

Non-operating expenses

    269.6    178.1    91.6    51.4 %   144.2    125.4    87.0 %   269.6

¨ Interest expense

    72.6    74.6    -2.0    -2.6 %   77.4    -4.8    -6.2 %   72.6

¨ FX transaction loss

    2.0    1.8    0.2    10.5 %   0.8    1.2    146.9 %   2.0

¨ FX translation loss

    108.4    12.5    95.9    767.1 %   17.2    91.2    531.4 %   108.4

¨ Loss on equity method

    36.5    17.5    19.0    108.3 %   8.2    28.3    347.4 %   36.5

¨ Loss on disposition of fixed assets

    7.9    20.8    -12.9    -61.9 %   8.3    -0.3    -3.9 %   7.9

¨ Others

    42.2    50.8    -8.6    -16.9 %   32.4    9.8    30.3 %   42.2

 

 FX translation loss

 

  - QoQ and YoY increase in FX translation loss due to increase in translations loss for foreign bonds affected by rise in exchange rate

 

8

Appendix : Factsheet   Mar-08

Broadband

 

    Mar-07     Apr-07     May-07     Jun-07     Aug-07     Sep-07     Oct-07     Nov-07     Dec-07     Jan-08     Feb-08     Mar-08  

Broadband Subs

   6,449,729     6,492,321     6,515,008     6,522,631     6,511,779     6,522,080     6,520,022     6,513,293     6,515,541     6,518,821     6,555,162     6,627,175  

Net Addition

   36,334     42,592     22,687     7,623     -1,069     10,301     -2,058     -6,729     2,248     3,280     36,341     72,013  

o Megapass Lite

   5,106,874     5,424,229     5,437,207     5,430,552     5,385,578     5,368,990     5,344,715     5,317,444     5,295,715     5,272,001     5,279,299     5,297,511  

o Megapass Premium

   579,580     258,690     262,392     264,185     267,596     270,462     273,295     275,144     277,399     282,599     286,665     302,459  

o Megapass Special

   7,739     32,237     35,463     36,641     38,873     40,161     41,754     43,623     45,383     47,297     51,535     59,049  

o Megapass Ntopia

   755,536     777,165     779,946     791,253     819,732     842,467     860,258     877,082     897,044     916,924     937,663     968,156  

Broadband M/S

 

                                                                        

KT

   45.3 %   45.4 %   45.4 %   45.2 %   44.8 %   44.7 %   44.5 %   44.3 %   44.3 %   44.1 %   44.2 %  

Hanaro

   25.6 %   25.5 %   25.5 %   25.5 %   25.4 %   25.3 %   25.2 %   25.1 %   24.9 %   24.8 %   24.6 %  

Powercomm

   9.3 %   9.8 %   10.1 %   10.3 %   10.7 %   10.9 %   11.1 %   11.4 %   11.7 %   11.9 %   12.0 %  

Dacom

   0.7 %   0.7 %   0.6 %   0.6 %   0.6 %   0.5 %   0.5 %   0.5 %   0.5 %   0.4 %   0.4 %  

SO

   17.0 %   17.0 %   17.1 %   17.2 %   17.3 %   17.4 %   17.5 %   17.6 %   17.5 %   17.6 %   17.7 %  

Others

   2.0 %   1.7 %   1.3 %   1.2 %   1.2 %   1.2 %   1.1 %   1.1 %   1.1 %   1.1 %   1.1 %  

Wireless

                        
    Mar-07     Apr-07     May-07     Jun-07     Aug-07     Sep-07     Oct-07     Nov-07     Dec-07     Jan-08     Feb-08     Mar-08  

NESPOT

   450,147     447,858     446,719     432,068     421,020     419,228     411,653     406,475     401,831     398,743     395,395     391,921  

WiBRO

   1,224     4,508     6,532     19,887     38,425     64,361     80,431     102,475     106,153     115,917     120,443     145,290  

KTF Resale

   2,806,610     2,838,079     2,888,641     2,944,658     2,920,531     2,916,277     2,870,464     2,873,989     2,927,201     2,943,999     2,919,223     2,938,583  

Mega-TV

 

                                                                        
    Mar-07     Apr-07     May-07     Jun-07     Aug-07     Sep-07     Oct-07     Nov-07     Dec-07     Jan-08     Feb-08     Mar-08  

MegaTV

   38,765     39,463     42,511     55,254     74,999     148,354     233,809     296,912     324,609     390,027     495,913     567,230  

Fixed-line

 

                                                                        
    Mar-07     Apr-07     May-07     Jun-07     Aug-07     Sep-07     Oct-07     Nov-07     Dec-07     Jan-08     Feb-08     Mar-08  

Telephony (‘000)

   21,263     21,259     21,262     21,238     21,191     21,184     21,139     21,103     20,919     20,882     20,842     20,818  

Household (‘000)

   20,281     20,266     20,259     20,219     20,153     20,117     20,064     20,018     19,980     19,936     19,894     19,861  

Business (‘000)

   982     993     1,003     1,019     1,037     1,067     1,075     1,085     938     946     948     958  

Domestic Long Distance (‘000)

   18,713     18,725     18,749     18,740     18,719     18,697     18,658     18,599     18,571     18,563     18,532     18,512  

* Ann (‘000)

   1,882     1,958     2,020     2,095     2,171     2,214     2,252     2,282     2,308     2,348     2,387     2,433  

* Ringo (‘000)

   3,809     3,664     3,785     3,779     3,774     3,783     3,610     3,605     3,843     3,830     3,817     3,821  

* Caller ID Users (‘000)

   5,403     5,438     5,478     5,503     5,525     5,538     5,538     5,532     5,538     5,548     5,553     5,569  

* My Style(Local) (‘000)

   671     775     834     928     1,053     1,075     1,060     1,044     1,022     1,013     1,005     985  

* My Style(DLD) (‘000)

   614     707     757     834     931     951     936     920     897     885     877     858  

Fixed-line M/S

 

                                                                        

Local M/S (subscriber base)

   91.7 %   91.6 %   91.5 %   91.4 %   91.1 %   91.0 %   90.8 %   90.6 %   90.4 %   90.3 %   90.2 %   90.1 %

DLD (revenue base)

   85.6 %   85.6 %   85.7 %   85.7 %   85.6 %   85.6 %   85.5 %   85.4 %   85.4 %   85.4 %   85.4 %   85.3 %

Reference Data

 

                                                                        
    Mar-07     Apr-07     May-07     Jun-07     Aug-07     Sep-07     Oct-07     Nov-07     Dec-07     Jan-08     Feb-08     Mar-08  

Population (‘000)

   48,418     48,431     48,444     48,457     48,457     48,457     48,457     48,457     48,457     48,444     48,444     48,444  

Number of Household

   16,194     16,194     16,194     16,194     16,194     16,194     16,194     16,194     16,194     16,194     16,194     16,194  

 

LOGO Fixed-line

 

  - Telephony : From Jan.2008, number of business line subscribers will be included in Telephony, pursuant to the reporting rules of MIC

 

  - Household : Formerly ‘Local’ subscribers