KEPCO posts profit for third consecutive quarter... Operating profit decreases amid rising energy prices

Sales Up 7.9%·Operating Expenses Down 20.8%
KEPCO "Concerns Over Increased Power Purchase Costs Due to Future Energy Price Hikes and High Exchange Rates"

Korea Electric Power Corporation (KEPCO) recorded a profit for the third consecutive quarter. However, KEPCO's operating profit margin is shrinking due to the rising trend in energy prices.

According to KEPCO on the 12th, the operating profit for the first quarter was 1.2993 trillion KRW, an increase of 121.0% (7.4769 trillion KRW) compared to the same period last year.

A KEPCO official explained, "This operating profit increased by 7.4769 trillion KRW compared to the same period last year," adding, "While sales increased by 1.6987 trillion KRW due to rate adjustments, operating expenses decreased by 5.7782 trillion KRW due to reductions in fuel costs and power purchase costs."

Looking at the main factors in detail, electricity sales revenue increased by 1.9059 trillion KRW despite a 1.1% decrease in sales volume due to a decline in industrial electricity sales, as the unit price rose 9.8% following three rate hikes last year.

Subsidiaries' fuel costs decreased by 2.9229 trillion KRW, and power purchase costs from private power producers also dropped by 2.968 trillion KRW. Additionally, maintenance costs increased by 139.9 billion KRW due to the expansion of power facilities.

A KEPCO official stated, "Due to three rate hikes last year and stabilization of fuel prices, operating profits have been recorded for three consecutive quarters on a consolidated financial statement basis," adding, "However, the quarterly operating profit scale is decreasing, with 2 trillion KRW in Q3 last year, 1.9 trillion KRW in Q4, and 1.3 trillion KRW in Q1 this year."

He continued, "With the ongoing Russia-Ukraine war and the expansion of conflicts in the Middle East, increases in international energy prices and high exchange rates are expected to raise power purchase costs amid changing business conditions," adding, "KEPCO will thoroughly and swiftly implement the self-help efforts promised to the public, actively respond to changes in the business environment, and consult with the government on various measures to resolve accumulated deficits."