content area
Press Release
Achieved a net income of KRW 368.4 billion, operating income of KRW 614.5 billion, and total sales of KRW 2.41 trillion
Laid a solid foundation for reaching business targets in 2005. Twenty four percent of the KRW 10 trillion sales revenue which is our targeted amount in 2005, has already been attained.
Stayed within the Annual Guidance of 18.5% for marketing expenses, by maintaining marketing expenses at 18.1% of overall sales revenue for the 1st quarter.
SK Telecom announced on April 28th that the company achieved a net income of KRW 368.4 billion, operating income of KRW 614.5 billion and total sales of KRW 2.41 trillion, for the 1st quarter of 2005. Net income and operating income decreased 18.6% and 11.1% respectively, and total sales revenue grew 0.5% over the same period in 2004. Compared to the 4th quarter of 2004, net income and operating income increased 5.8% and 3.4% respectively, while total sales was down by 2.9%.
Sales revenues rose slightly, helped by an increase in subscribers as well as wireless Internet revenue growth. This occurred despite the adjustment of interconnection fees last April, and the tariff reduction of last September. Wireless Internet sales revenues were KRW 547.7 billion, representing a 40% growth compared to the same period last year. It was also a 1% increase on a quarter-on-quarter basis. This increase can be attributed to the introduction of a variety of data flat rate plans such as the Data Free Rate Plan, and the continuous growth of phone mail service. SK Telecom’s wireless Internet revenue represented 25% of the total cellular service revenue, greatly contributing to the growth of the company’s overall sales.
Due to the decrease in network interconnection expenses, followed by a reduction of call traffic volume, the company’s operating income and net income rose 3% and 6% respectively when compared to the previous quarter. Due to the increased interconnection fees from the interconnection rate adjustment and tariff reduction, the operating income and net income fell by 11% and 19% respectively, on a year-on-year basis
An SK Telecom official revealed that the marketing expenses for the quarter were KRW 436 billion, which was a 9% decrease from those in the same period of 2004. Due to the full-fledged launching of the mobile number portability system in January of 2005, SK Telecom’s subscription fees for acquiring new subscribers increased. However, management fees and maintenance fees for our subscriber base decreased in accordance with the company’s policy toward new subscriber-focused marketing approaches. This is the important factor that caused a decrease in marketing expenses. For the 1st quarter, SK Telecom stayed within the Annual Guidance of 18.5% for marketing expenses, as we maintained marketing expenses at 18.1% of overall sales revenue for the quarter.
Due to tariff reduction, the company’s average revenue per user (ARPU) came to KRW 42,557, a 2% decrease year on year. It also fell by 4% compared to the 4th quarter of 2004. This was due to seasonal factors, such as decreased number of working days.
Sung Min Ha, CFO of SK Telecom (head of Management Support Group) commented, "Even though the 1st quarter was an inactive period for the mobile phone market, SK Telecom achieved 24% of the targeted KRW 10 trillion in sales for the year 2005. This has laid a stable base for accomplishing our targeted total revenue in 2005". He also added, "The launching of SK Telecom’s new services, such as satellite DMB and WCDMA, are designed to secure new growth engines that are expected to contribute a great deal to the increase in ARPU, as well as subscriber loyalty"
Sales revenues rose slightly, helped by an increase in subscribers as well as wireless Internet revenue growth. This occurred despite the adjustment of interconnection fees last April, and the tariff reduction of last September. Wireless Internet sales revenues were KRW 547.7 billion, representing a 40% growth compared to the same period last year. It was also a 1% increase on a quarter-on-quarter basis. This increase can be attributed to the introduction of a variety of data flat rate plans such as the Data Free Rate Plan, and the continuous growth of phone mail service. SK Telecom’s wireless Internet revenue represented 25% of the total cellular service revenue, greatly contributing to the growth of the company’s overall sales.
Due to the decrease in network interconnection expenses, followed by a reduction of call traffic volume, the company’s operating income and net income rose 3% and 6% respectively when compared to the previous quarter. Due to the increased interconnection fees from the interconnection rate adjustment and tariff reduction, the operating income and net income fell by 11% and 19% respectively, on a year-on-year basis
An SK Telecom official revealed that the marketing expenses for the quarter were KRW 436 billion, which was a 9% decrease from those in the same period of 2004. Due to the full-fledged launching of the mobile number portability system in January of 2005, SK Telecom’s subscription fees for acquiring new subscribers increased. However, management fees and maintenance fees for our subscriber base decreased in accordance with the company’s policy toward new subscriber-focused marketing approaches. This is the important factor that caused a decrease in marketing expenses. For the 1st quarter, SK Telecom stayed within the Annual Guidance of 18.5% for marketing expenses, as we maintained marketing expenses at 18.1% of overall sales revenue for the quarter.
Due to tariff reduction, the company’s average revenue per user (ARPU) came to KRW 42,557, a 2% decrease year on year. It also fell by 4% compared to the 4th quarter of 2004. This was due to seasonal factors, such as decreased number of working days.
Sung Min Ha, CFO of SK Telecom (head of Management Support Group) commented, "Even though the 1st quarter was an inactive period for the mobile phone market, SK Telecom achieved 24% of the targeted KRW 10 trillion in sales for the year 2005. This has laid a stable base for accomplishing our targeted total revenue in 2005". He also added, "The launching of SK Telecom’s new services, such as satellite DMB and WCDMA, are designed to secure new growth engines that are expected to contribute a great deal to the increase in ARPU, as well as subscriber loyalty"