KT Corp (NYSE:KT) Q4 2016 Earnings Conference Call - Final Transcript

Feb 01, 2017 • 02:00 pm ET

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KT Corp (NYSE:KT) Q4 2016 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

[Foreign Speech]

Good morning and good evening. First of all, thank you all for joining this conference call. And now, we will begin the conference of the 2016 Fourth Quarter Preliminary Earnings Results by KT.

We would like to have welcoming remarks from Mr. Youngwoo Kim, KT IRO, and then Mr. Kwang-Suk Shin, CFO, will present earnings results and entertain your questions. This conference will start with a presentation followed by a Q&A session. [Operator Instructions].

Now, we would like to turn the conference over to Mr. Youngwoo Kim, KT IRO.

Executive
Youngwoo Kim

[Foreign Speech]

Good afternoon, I am Youngwoo Kim, KT's IRO. Let's begin the presentation on 2016 full-year earnings results. Our call is being webcasted via the Company's website. So please refer to the presentation slides as we present.

[Foreign Speech]

And please note that we have been releasing consolidated numbers under the IFRS standards since the first quarter of 2011. We will begin with our CFO, Kwang-Suk Shin's remarks on full-year results including Q4 2016 performance.

Executive
Kwang-Suk Shin

[Foreign Speech]

Good afternoon, I am Kwang-Suk Shin, KT's CFO. Over the past three years, KT has presented a new vision; regained competitiveness in it's telecom business, improved the way customer see us, which led to a successful earnings turnaround in 2015, and over 10% year-over-year operating profit growth in 2016, proving that KT has successfully laid the basis for a sustainable growth.

[Foreign Speech]

For the wireless business, we discovered a new segment such as the Y24 and GiGA LTE, offered a line-up of variety of second device models, providing differentiated services for the changing market and catering to the specific customer segments based on which we sustained growth and quality reaching 18.9 million cumulative wireless subscribers with a net addition of 850,000 year-over-year.

[Foreign Speech]

For the Internet business, GiGA Internet has taken root as the market mainstream. KT's GiGA Internet with it's unrivaled speed, quality and coverage was loved by the customers with its subscriber base reaching above 2.5 million most recently. For the IPTV business, we were the first to achieve 7 million subscribers in the Pay-TV segment. And we expect IPTV revenue to be above annual BEP this year, and look forward to a significant bottom-line contribution.

[Foreign Speech]

In terms of the future business, since the first commercialization of LTE-M nationwide network in 2016, KT has seen a growth in number of partners and products for Internet of Small Things such as smart metering, smart blood box, making KT number one in net addition market share for wireless IoT last year. This year we are targeting KRW1 trillion in revenue from future businesses, and we're focused on three main strategy implementations; which are aggressive pursuit of energy and security business, making our core platform into the so-called big business, and taking our internally-owned solutions to the global market.

[Foreign Speech]

We were able to experience early on through the world's first launch of AI, artificial intelligence TV, GiGa Genie, how the convergence between KT's fixed and wireless infrastructure