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Press Release
Revenue KRW 2.6383 trillion, operating income KRW 619.3 billion, net income KRW 373.3 billion
Growth in second half 2006 expected with strengthening of business models in HSDPA, overseas businesses and other new business
On July 1, SK Telecom (CEO Kim Shin-Bae, www.sktelecom.com) announced its earnings for the second quarter of 2006 - revenue of KRW 2.6383 trillion, operating income of KRW 619.3 billion, and net income of KRW 373.3 billion, with a growth in revenue and net income of 3.9% and 10.7% respectively from the previous quarter, and a 7.3% drop in operating income.
The Company recorded revenue of KRW 2.6383 trillion, and, due to the consistent increase in subscribers, a quarter-to-quarter growth of 3.9%, and year-on-year increase of 4.4%, despite factors such as provision of free CID services beginning from January.
Due to the effect of increased marketing expenses and other factors, operating income dropped 13.2% from the previous year, and 7.3% from the previous quarter to record KRW 619.3 billion, while net income recorded KRW 373.3 billion, a 10.7% increase from the previous quarter, when there had been the influence of a temporary increase in non-operating expenses due to the change in the severance pay system.
In the case of marketing expenses over revenue, the retention fee and solicitation fee grew with the legalization of subsidies, while increase in promotion and advertisement costs in connection with the World Cup and other factors led to a quarter-to-quarter growth of 5.4%p, and year-on-year increase of 5.2%p to record 22.7%, marketing expenses totaling KRW 599.5 billion.
MOU (monthly average call volume) was 203 minutes, maintaining a growth trend with an increase of 8 minutes from the previous quarter and 3 minutes from the same quarter of the previous year, assisted by seasonal factors, advanced customer structure and continuous increase in subscribers to extended call fee plans.
ARPU (monthly revenue per user) grew 2.8% from the last quarter to record KRW 44,352, due to the rise in call charge rate, increase in MOU and growth in wireless Internet ARPU with the expansion of the multi-SMS fee plan.
SK Telecom’s CEO Kim Shin-Bae remarked, "Since legalization of the subsidy system, there has been heated competition due to aggressive marketing by competitors. However, SK Telecom will work to lead market stabilization while maintaining its market leadership" Mr. Kim added, "We will focus our competencies to strengthen our existing overseas businesses in the U.S., China and Vietnam, and strengthen our business model for new businesses through launching of marketing of HSDPA services commercialized in 1H, and review of the marketability of Wibro."
The Company recorded revenue of KRW 2.6383 trillion, and, due to the consistent increase in subscribers, a quarter-to-quarter growth of 3.9%, and year-on-year increase of 4.4%, despite factors such as provision of free CID services beginning from January.
Due to the effect of increased marketing expenses and other factors, operating income dropped 13.2% from the previous year, and 7.3% from the previous quarter to record KRW 619.3 billion, while net income recorded KRW 373.3 billion, a 10.7% increase from the previous quarter, when there had been the influence of a temporary increase in non-operating expenses due to the change in the severance pay system.
In the case of marketing expenses over revenue, the retention fee and solicitation fee grew with the legalization of subsidies, while increase in promotion and advertisement costs in connection with the World Cup and other factors led to a quarter-to-quarter growth of 5.4%p, and year-on-year increase of 5.2%p to record 22.7%, marketing expenses totaling KRW 599.5 billion.
MOU (monthly average call volume) was 203 minutes, maintaining a growth trend with an increase of 8 minutes from the previous quarter and 3 minutes from the same quarter of the previous year, assisted by seasonal factors, advanced customer structure and continuous increase in subscribers to extended call fee plans.
ARPU (monthly revenue per user) grew 2.8% from the last quarter to record KRW 44,352, due to the rise in call charge rate, increase in MOU and growth in wireless Internet ARPU with the expansion of the multi-SMS fee plan.
SK Telecom’s CEO Kim Shin-Bae remarked, "Since legalization of the subsidy system, there has been heated competition due to aggressive marketing by competitors. However, SK Telecom will work to lead market stabilization while maintaining its market leadership" Mr. Kim added, "We will focus our competencies to strengthen our existing overseas businesses in the U.S., China and Vietnam, and strengthen our business model for new businesses through launching of marketing of HSDPA services commercialized in 1H, and review of the marketability of Wibro."