Seoul, Korea, 31 January, 2008 - SK Telecom (NYSE:SKM) announced its 2007 annual earnings: revenue of KRW 11.28 trillion, operating income of KRW 2.17 trillion and net income of KRW 1.64 trillion.

The revenue of KRW 11.28 trillion represents a 6% year-on-year increase. Such an increase was mainly due to a steady growth in the subscriber base and the increase in the Wireless Internet sales, which was backed by the increase in the phone mail revenue.

Despite the rate cuts of 30% in data traffic fees in 2007, the Wireless Internet revenue had increased by 2.5% year-on-year, reaching KRW 2.8 trillion – which was 27.5% of the total revenue excluding interconnection fees. This was possible mainly due to the increase in the number of data flat rate subscribers and the subscribers of the contract-based text message usage tariff plan.

Marketing expenses increased by 31% to KRW 2.85 trillion, due to the strong growth of the WCDMA market, and, as a result, the operating income fell by 16% to KRW 2.17 trillion. However, the net income grew by 13.5% year-on-year to KRW 1.64 trillion mainly due to the one-off reflection of gains from conversion of China Unicom convertible bonds.

The total number of SK Telecom subscribers in 2007 was 21.97 million, an increase of 8% from the previous year. The Average Revenue per User (ARPU) recorded KRW 44,416, a slight decrease compared to the previous year, mainly due to cuts in data traffic fees and on-net call discounts.

Meanwhile, the revenue from the fourth quarter of 2007 showed a 4% quarter-on-quarter growth to KRW 2.91 trillion, while operating income and net income decreased to KRW 310.7 billion and KRW 66 billion respectively.

SK Telecom’s CEO Shin-Bae Kim said, "The business environment is somewhat difficult to predict due to the expansion of the WCDMA market, the introduction of more bundled services, and the expected elimination of handset subsidy regulation."
Kim added, "SK Telecom plans to promote growth by creating alternatives to overcome the limits of the domestic market, such as strengthening the basis of the WCDMA business and launching various convergence services, while demonstrating visible achievements in our global businesses."