LG Uplus Profit Jumps On Subscriber Gains


South Korea operator LG Uplus recorded a sharp profit gain in Q2 as it continued to add premium mobile and IPTV subscribers and moved to control costs, with capex falling significantly short of its H1 target.

In an earnings call, LG Uplus CFO Lee Hyuk-Ju said despite difficulties following the impact of the Covid-19 (coronavirus) pandemic, “we were able to bring robust revenue growth across the entire business by growing our high-quality subscriber base and improving our profitability”.

He expects the release of additional premium 5G handsets over the next two quarters to accelerate demand for the next-generation service after sales volumes were negatively impacted by the pandemic in Q1 and Q2.

Net profit surged 52.9 per cent year-on-year to KRW150.6 billion (US$127 million), while consolidated service revenue grew 14.2 per cent to KRW2.62 trillion, driven by gains in mobile, broadband, IPTV and B2B infrastructure.

Mobile service revenue increased 4.9 per cent to KRW1.35 trillion; handset sales declined 20.4 per cent to KRW654 billion.

The operator added 330,000 5G subscribers in Q2, up from 290,000 additions in the first quarter, closing June with 1.785 million, accounting for 12.3 per cent of total subs (excluding MVNO subs).

Overall mobile subs increased 5.9 per cent from a year earlier to 14.55 million at end-June. ARPU dipped 2.2 per cent to KRW30,480.

Smart Home revenue increased 10.5 per cent to KRW495 billion, due to strong growth in IPTV and broadband internet subscriber acquisition and revenue. Enterprise turnover inched up 2.7 per cent to KRW345 billion.

H1 capex totaled about KRW1 trillion. Full-year capex guidance is KRW2.5 trillion, compared with KRW2.6 trillion in 2019.

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