LG U+Records Brilliant Annual Performance
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LG U+Records Brilliant Annual Performance
Telecommunication firm sees 2013 operating profit up 327 pct YoY and sales rising to 11.45 tln won

27(Thu), Feb, 2014

President Lee Sang-cheol of LGU+.(Photo:LGU+: article by SK Lee)

LG U+ had a brilliant year last year with its operating profit rising 327 percent YoY to 542.1 billion won amid tough competition between the three major contenders in the industry LG U+, KT and SK Telecom a year that saw KT’s operating profit plunge 27.7 percent YoY to 874 billion won, industry sources said recently.

The telecommunication company recorded 11.45 trillion won in sales last year, up 5 percent YoY, with net profit standing at 270.5 billion won, recovering from a loss of 59.6 billion won the preceding year.

LG U+ attributed the excellent performance record to continued growth in the wireless sector and very good operational results at the Internet TV (IPTV) division and others in the wired sector of its operation.

The wireless sector growth is owed to increases in the number of LTE subscribers and sales to the subscribers (ARPU), up 19.8 percent from the preceding year at 4.768 trillion won. The company also named the rise in the number of the LTE subscribers as the biggest factor for the increase in operating profit as they spent a lot of communication fees boosting their share to 65.2 percent of total sales revenue in 2013, up from 43.1 percent in 2012.

ARPU accounted for 34,106 won up 13.5 percent YoY in 2013.

In the meantime, KT, which is being pursued by its rival firms, suffered the biggest declines last year among the three major telecommunication firms in Korea. Its operating profit and net profit amounted to 874 billion won and 181.6 billion won respectively, down 27.7 percent and 83.6 percent respectively YoY, with total revenue standing at 23.81 trillion won, down 0.2 percent YoY, industry sources said.

KT’s huge losses stemmed from the reductions in the use of land-line telephones and the company’s wireless sector also suffered losses due to the two suspensions of its operations and increases in marketing expenses to secure customers.

Also among the big factors in its operational loss was the so called “Big Bath” that occurred during the time when the CEO position changed hands, leading to new CEO Hwang Chang-kyu to declare emergency operations for KT at an emergency meeting of key executives on Dec. 28.

SK Telecom, on the other hand, has been considered to have done all right last year in its operations with operating profit standing at 2.111 trillion won, up 16.2 percent YoY, while sales rose 2.9 percent YoY to 16.602 trillion won. 

The competition for this year in the telecommunication industry is projected to grow worse than last year. SK Telecom will stick to its plan to defend its market share of over 50 percent, the level the company achieved last year, while KT pledges to maintain its 30 percent share and LGU+wants to increase its wireless sector share by 5 percent this year over what it achieved last year.

In the meantime, LG U+ has introduced a camera that will put the customers’ minds at ease, by monitoring every nook and corner of the house with an HD class CCTV that is remotely controlled by smartphones outside the home, the company said recently.

The ‘Mom Car Home TV’ that the company has put on the market can show the entire house, while similar CCTVs can only monitor limited places. The new CCTV has a maximum of 345 degrees viewing from left to right and 110 degrees up and down, leaving no dead corner in the house, the company said.

The brand new CCTV comes with a sensor attached inside so that it can identify the people caught by the camera, so that the owners don’t have to buy the sensors separately. And it can send pictures of intruders to the owners’ smartphones in real time.  

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