Sk Telecom Co., Ltd. · KRX:017670

Sk Telecom — Q3 2014 Earnings Presentation

20 slides from Sk Telecom's earnings presentation, November 2014

  1. Slide 1: Investor Presentation

    Investor Presentation November 2014

  2. Slide 2: Disclaimer

    Disclaimer This material contains forward-looking statements with respect to the financial condition, results of operations and business of SK Telecom and its subsidiaries (the “Company”) and plans and objectives of the management of the Company. Statements that are not historical facts, including s

  3. Slide 3: Table of Contents

    Table of Contents Ⅰ. Key Takeaways 3 Ⅱ. Financial Results 8 Ⅲ. Operating Results 11 Ⅳ. Shareholder Return 14 Ⅴ. Appendix 15 2

  4. Slide 4: Key Takeaways: ARPU

    Ⅰ. Key Takeaways ARPU  Expanding LTE subscribers continues to drive ARPU [ Number of LTE subscribers ] [ Billing ARPU ] % of total subscribers ARPU (KRW ‘000) YoY growth Subscribers (mn) 57.0% 36.4 55.2% 53.2% 36.0 49.3% 35.7 35.3 16.2 15.4 34.9 14.8 13.5 34.0 27.8% 33.7 23.0% 5.9% 5.4% 5.6% 4.9% 4

  5. Slide 5: Key Takeaways: Marketing Expenses

    Ⅰ. Key Takeaways Marketing Expenses  Marketing expenses remained flat QoQ despite increases in new and upgrading subscribers [ Marketing stats] Marketing exp./sales Gross adds, incl. upgrading subs. (in mn)  In ‘14.3Q, marketing exp. to sales ratio remained flat while the 18% QoQ increase in gross

  6. Slide 6: Key Takeaways: Data Usage Trend

    Ⅰ. Key Takeaways Data Usage Trend  Comfortably managing the rising LTE data traffic with existing frequency assets and leveraging highly efficient network management tools [ Monthly LTE data usage per sub ] (GB) Launched unlimited  Ample 40MHz of LTE spectrum to accommodate LTE data plans rising L

  7. Slide 7: Key Takeaways: IoT/B2B Solution

    Ⅰ. Key Takeaways IoT/B2B Solution  SKT at the forefront of IoT growth [ High speed mobile data network ] [ Solutions and platforms ]  Wide and deep LTE-A coverage: 201K base  B2B solutions showing strong growth stations - KRW 430 bn in sales in 2013  World’s first to develop 3 band 300Mbps LTE-

  8. Slide 8: Key Takeaways: SK Planet

    Ⅰ. Key Takeaways SK Planet  SK Planet strives to be a global leader in Next Commerce with 5 trillion won in Enterprise Value “Global Leader in Next Commerce” [ Smart offering ] [ Global commerce ] [ Market place ]  Expanding the online to offline (“O2O”)  Solidify domestic market position service

  9. Slide 9: Financial Results: Summary of Income Statement (Consolidated)

    Ⅱ. Financial Results  Summary of Income Statement (Consolidated) (KRW bn) 3Q14 3Q13 YoY 3Q14 2Q14 QoQ  SK Telecom (“SKT” or the “Company”) operating revenue Operating revenue 4,367 4,125 243 5.9% 4,367 4,305 62 1.4% increased 5.9% YoY and 1.4% QoQ led by the growth of Operating expenses 3,831 3,57

  10. Slide 10: Financial Results: Operating Expenses (Consolidated)

    Ⅱ. Financial Results  Operating Expenses (Consolidated) (KRW bn) 3Q14 3Q13 YoY 3Q14 2Q14 QoQ  Labor cost increased 13.2% YoY and 2.5% QoQ due to Labor cost 411 363 48 13.2% 411 401 10 2.5% the rise in the number of employees Commissions paid 1,327 1,350 (23) -1.7% 1,327 1,364 (38) -2.8% Advertisin

  11. Slide 11: Financial Results: Operating Revenues (Non-consolidated)

    Ⅱ. Financial Results  Operating Revenues (Non-consolidated) YoY QoQ (KRW bn) 3Q14 3Q13 3Q14 2Q14  Total operating revenue increased 2.5% YoY and 1.2% Total operating revenue 3,304 3,223 81 2.5% 3,304 3,265 39 1.2% QoQ led by the growth of the LTE service and increased Mobile service revenue 2,814

  12. Slide 12: Operating Results: ARPU

    Ⅲ. Operating Results (Non-consolidated)  ARPU ARPU1) (KRW) 3Q14 3Q13 YoY 3Q14 2Q14 QoQ  Billing ARPU showed steady growth, increasing 4.3% YoY Total ARPU 44,892 42,780 2,112 4.9% 44,892 44,217 676 1.5% Billing ARPU2) 36,417 34,909 1,508 4.3% 36,417 36,013 404 1.1% led by the growth of the LTE serv

  13. Slide 13: Operating Results: Subscriber Numbers

    Ⅲ. Operating Results (Non-consolidated)  Subscriber Numbers YoY QoQ The number of LTE subscribers reached 16.2 mn in 3Q14. 3Q14 3Q13 3Q14 2Q14  Subscribers ('000) 28,403 27,211 1,193 4.4% 28,403 27,889 514 1.8% Net adds 514 71 443 624.6% 514 76 438 578.9% Over 57% of SKT’s subscribers are currentl

  14. Slide 14: Operating Results: Marketing Expenses & Capex

    Ⅲ. Operating Results (Non-consolidated)  Marketing Expenses & Capex Marketing expenses increased 0.6% YoY and 0.9% QoQ (KRW bn) 3Q14 3Q13 YoY 3Q14 2Q14 QoQ  Marketing expenses1) 832 827 5 0.6% 832 825 7 0.9% % of operating revenue 25.2% 25.7% -0.5%p 25.2% 25.3% -0.1%p due to the rise in new subscr

  15. Slide 15: Shareholder Return

    Ⅳ. Shareholder Return  Maintain strong shareholder return policy ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ’13  Paid annual cash dividend of KRW 9,400/share since Dividend Policy DPS 2007 including interim dividend of KRW 1,000/share Cash Dividends Dividend Per KRW 9,400 / Share * Record date for 2014 interim divid

  16. Slide 16: Appendix: Consolidated Income Statement

    Appendix  Consolidated Income Statement (KRW bn) 1Q13 2Q13 3Q13 4Q13 FY13 1Q14 2Q14 3Q14 Operating revenue 4,065.7 4,117.0 4,124.6 4,294.8 16,602.1 4,201.9 4,305.4 4,367.5 Operating expenses 3,661.1 3,571.5 3,573.2 3,785.1 14,590.9 3,949.5 3,759.3 3,830.9 Labor cost 444.0 359.2 363.2 395.0 1,561.4

  17. Slide 17: Appendix: Non-consolidated Income Statement

    Appendix  SK Telecom Non-consolidated Income Statement (KRW bn) 1Q13 2Q13 3Q13 4Q13 FY13 1Q14 2Q14 3Q14 Operating revenue 3,112.1 3,209.1 3,222.9 3,316.3 12,860.4 3,263.7 3,264.6 3,303.6 Operating expenses 2,692.0 2,676.8 2,685.7 2,836.2 10,890.7 3,012.4 2,736.9 2,797.9 Labor cost 205.3 135.7 134.3

  18. Slide 18: Appendix: Consolidated Balance Sheet

    Appendix  Consolidated Balance Sheet (KRW bn) 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 Total assets 25,408.8 25,436.4 25,933.5 26,576.5 26,067.2 27,027.6 27,685.0 Current assets 5,081.7 5,230.7 5,381.6 5,123.4 4,781.8 5,592.6 5,740.2 Cash and marketable securities 1) 1,493.0 1,693.5 1,937.0 1,765.1 1,384

  19. Slide 19: Appendix: Non-consolidated Balance Sheet

    Appendix  SK Telecom Non-consolidated Balance Sheet (KRW bn ) 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 Total assets 22,391.5 22,147.4 22,416.2 22,827.4 22,256.0 22,494.0 22,829.6 Current assets 2,765.8 2,809.9 2,956.8 2,817.8 2,563.8 2,755.0 2,941.3 Cash and marketable securities 1) 631.3 659.3 754.5 669

  20. Slide 20: IR Contacts

    IR Contacts Dong Seop Kim (82-2-6100-1464, sunson@sk.com) Hye Seung Han (82-2-6100-3681, hyeseung.han@sk.com) Hun Lee (82-2-6100-1334, hun.lee@sk.com) Woo Sun Cho (82-2-6100-1638, woosun.cho@sk.com) Jung Hyun Kim (82-2-6100-1582, jane.kim@sk.com) 19

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