SKT net profit below forecasts as non-operating expenses rise

South Korea’s largest mobile operator by subscribers, SK Telecom (SKT), has reported lower than expected profit for the three months ended 31 March 2009. The operator posted a KRW317 billion (USD236 million) net profit for the three-month period, a 17% decline against the same quarter a year earlier. The drop was attributed predominantly to foreign exchange losses, with non-operating expenses for the cellco rising 72% compared to the same period last year to KRW434 billion. Notably, however, marketing costs fell by 14% to KRW661 billion as the competition to attract new subscribers has eased. Revenue for the three-month period was up marginally, rising 1% year-on-year to KRW2.88 trillion, while earnings before interest, tax, depreciation and amortisation (EBITDA) rose 3% against 1Q 2008 to KRW997 billion. At the end of March 2009 SKT had 23.348 million subscribers, up 4% against end-March 2008.