KT Alpha Q2 Operating Profit Up 40.1%... "Clear Profitability Improvement" (Comprehensive)

Surpassing Last Year's Annual Operating Profit in Half a Year
Accelerating Commerce Growth Drivers like OnAir Delivery

[Asia Economy Reporter Lim Chun-han] KT Alpha announced on the 11th that its consolidated sales for the second quarter of this year were tentatively recorded at 130.9 billion KRW, a 27.9% increase compared to the same period last year, and operating profit was 3.9 billion KRW, a 40.1% increase. With this, the company achieved sales of 262.8 billion KRW and operating profit of 10.1 billion KRW in the first half of the year, significantly improving profitability by surpassing last year's full-year operating profit of 4.2 billion KRW.

Commerce business sales recorded 80.6 billion KRW, a 15.0% increase compared to the same period last year. Despite the slowdown in growth of non-face-to-face commerce following the easing of social distancing measures, the company is expanding transaction volume through strategic focus on fashion and food categories. In particular, sales rates increased significantly due to the expanded composition ratio of health foods, and sales growth was driven by strengthening the competitiveness of local traditional restaurants and celebrity-centered food brands. Additionally, through joint investment with Oasis, a fresh food dawn delivery specialized commerce company, KT Alpha is accelerating efforts to secure new growth engines in the commerce business by promoting the live commerce-based On-Air Delivery service (a service where viewers can place orders during live commerce broadcasts and receive immediate delivery).

Mobile gift commerce business sales reached 23.4 billion KRW. This represents a 67.3% increase compared to the same period last year of KT M-House, the merged company before the merger date, driven by continuous growth in the mobile gift certificate business and the inclusion effect of the Ringo business, an advertising and promotion-based commerce support platform for small business owners. The mobile gift commerce business plans to continue growth based on expanding sales of the online B2B ‘GiftyShow Biz’ and increasing bids and proposals for corporate clients.

Content business sales recorded 12.1 billion KRW, a 2.1% decrease compared to the same period last year. This decline is due to a lack of new Korean movie lineups, but the company is focusing on securing profitability through distribution of rights to OTT platforms and expanding coverage of the real-time movie channel Cinema Heaven. KT Alpha also plans to actively engage in the global content distribution business based on overseas rights sales of Watcha Originals.

ICT business sales recorded 14.7 billion KRW, a 26.0% decrease compared to the same period last year. This is due to organizational restructuring for business group realignment, where the Ringo business and media programming operation business were reclassified under the mobile gift commerce and content divisions. Excluding these, ICT sales increased by 51%. The ICT business plans to maximize ICT competitiveness by strengthening capabilities centered on KT Group’s AI, big data, and DX platform businesses and a rapid decision-making system, and will undergo a physical division on the 1st of next month.