SK Telecom (NYSE:SKM, hereinafter referred to as “SKT”) today announced its earnings for the year 2020 on a K-IFRS 16 consolidated basis: revenue of KRW 18.625 trillion, operating income of KRW 1.349 trillion, and net income of KRW 1.501 trillion.

SKT’s consolidated revenue increased by 5.0% compared to the previous year. This comes as a result of a 15.3% year-on-year (YoY) revenue growth of its ‘New ICT’ business areas including media and commerce, along with a 2.8% YoY revenue increase posted by the MNO business thanks to 5G subscriber additions.

Operating income expanded by 21.8% compared to the previous year. In particular, based on pay TV subscriber number increase, gross merchandise value (GMV) expansion of the commerce business, and growth of new security services such as home security and parking, the operating income of the New ICT businesses increased by 27.5% YoY.

Net income jumped by 74.3% YoY to KRW 1.501 trillion due to increased equity method gains from SK Hynix.

In 2021, SKT will speed up its growth as a leading ICT company by applying artificial intelligence (AI) technologies to all products and services, while the app market One Store pushes for initial public offering (IPO). SKT expects to achieve an annual revenue of KRW 19.5 trillion for year 2021.

On a non-consolidated basis, SKT’s annual revenue increased by 2.8% YoY to KRW 11.747 trillion affected by the growth in the number of 5G subscribers and their mobile data usage. Operating income made a turnaround, expanding by 7.5% YoY from KRW 951.8 billion in 2019 to KRW 1.231 trillion in 2020.

The MNO business sustained its 5G market leadership in 2020. The number of SKT’s 5G subscribers was around 5.48 million as of the end of 2020 and is expect to reach 9 million by the end of this year.

The MNO business implemented diverse customer-friendly marketing activities fit for the pandemic situation such as non-face-to-face 24-hour service activation, and opened T Factory to share its ICT vision and innovations. Through these efforts, SKT topped all three major satisfaction surveys in Korea – i.e. National Customer Satisfaction Index (NCSI), Korean Customer Satisfaction Index (KCSI) and Korea Standard-Service Quality Index (KS-SQI) – for 23 consecutive years.

Following the successful launch of ‘V Coloring,’ a video ringback tone service, in 2020, the MNO business will focus on offering subscription-based services powered by artificial intelligence (AI) technologies this year. It is set to introduce a wide variety of subscription-based services that go beyond the field of mobile communications to serve a much broader customer base.

The year 2020 was marked by strong performance of the New ICT business areas. The combined total operating income of the New ICT businesses stood at KRW 326.2 billion, accounting for 24% of the company’s total operating income.

The media business served as the main driver for earnings growth of the new business areas. SK Broadband’s revenue for 2020 increased by 17.2% YoY to KRW 3.714 trillion affected by its merger of T-broad and growth in the number of IPTV subscribers. Its operating income expanded by 59.2% YoY to stand at KRW 230.9 billion.

SKT’s security business reported an annual revenue of KRW 1.339 trillion, increasing by 12.2% YoY thanks to the even growth of its key business areas, including dispatch security and information security, and new business areas like home security, parking and non-face-to-face solutions.

The annual revenue for the commerce business – 11st and SK Stoa - grew by 12.1% YoY to KRW 814.2 billion on the back of the increased online shopping trend and GMV. The operating income for the year 2020 stood at KRW 11 billion, recording a surplus for two consecutive years.

T Map Mobility, a specialized mobility company launched in December 2020, is set to become a Mobility-as-a-Service (MaaS) provider with car sharing, rent-a-car, taxi, and public transportation-related service offerings. T Map Mobility plans to launch an e-hailing joint venture with Uber Technologies in the first half of this year.

The mobile app market One Store saw its GMV grow for 10 consecutive quarters backed by constant increase in the number of users, and reported net income surplus in 2020. One Store is expected to continue its growth this year and become the first SKT subsidiary to promote IPO.

Through the merger between SK Broadband and T-broad, launch of T Map Mobility, and merger between ADT Caps and SK Infosec, SKT has secured stronger growth engines and turned itself into a company with five key businesses. This year, SKT is set to speed up its growth by innovating all products and services with AI and expanding its collaboration with diverse global companies. 

“In 2020, we achieved even growth of MNO and New ICT, and successfully set up five core business areas,” said Yoon Poong-young, CFO of SKT. “This year, we will accelerate our evolution towards becoming a global ICT company with unrivalled competitiveness in AI, and make efforts to achieve a record annual revenue of KRW 20 trillion.”  

※ The conference call in regard to SK Telecom’s 2020 earnings results can be heard via SK Telecom’s webpage on Wednesday, February 3, from 16:30 Seoul Time.
Link: http://cast.emodoom.com/webcasting/202101052831201/EN

※ Attachment 1. Summary of Consolidated Income Statement (Unit: KRW billion)

※ Attachment 2. Summary of Non-Consolidated Income Statement (Unit: KRW billion)