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KT CORP

KT CORPKT财报

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KT Corporation, formerly Korea Telecom, is a South Korean telecommunications company, mobile network operator (MNO) and mobile virtual network operator (MVNO). KT is the large wireless carrier in South Korea, with 13.5 million subscribers as of Q4 2023.

What changed in KT CORP's 20-F — 2023 vs 2024

Top changes in KT CORP's 2024 20-F

409 paragraphs added · 370 removed · 308 edited across 6 sections

Item 2. Properties

Properties — owned and leased real estate

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Item 2. Offer Statistics and Expected Timetable 1 Item 2.A. Offer Statistics 1 Item 2.B. Method and Expected Timetable 1 Item 3. Key Information 2 Item 3.A. [RESERVED] 2 Item 3.B. Capitalization and Indebtedness 2 Item 3.C. Reasons for the Offer and Use of Proceeds 2 Item 3.D. Risk Factors 2 Item 4. Information on the Company 20 Item 4.A.
Item 2. Offer Statistics and Expected Timetable 2 Item 2.A. Offer Statistics 2 Item 2.B. Method and Expected Timetable 2 Item 3. Key Information 2 Item 3.A. [RESERVED] 2 Item 3.B. Capitalization and Indebtedness 2 Item 3.C. Reasons for the Offer and Use of Proceeds 2 Item 3.D. Risk Factors 2 Item 4. Information on the Company 20 Item 4.A.
Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation 72 i Table of Contents Item 7. Major Shareholders and Related Party Transactions 73 Item 7.A. Major Shareholders 73 Item 7.B. Related Party Transactions 73 Item 7.C. Interests of Experts and Counsel 73 Item 8. Financial Information 73 Item 8.A. Consolidated Statements and Other Financial Information 73 Item 8.B.
Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation 81 i Table of Contents Item 7. Major Shareholders and Related Party Transactions 81 Item 7.A. Major Shareholders 81 Item 7.B. Related Party Transactions 81 Item 7.C. Interests of Experts and Counsel 81 Item 8. Financial Information 81 Item 8.A. Consolidated Statements and Other Financial Information 81 Item 8.B.
Significant Changes 75 Item 9. The Offer and Listing 75 Item 9.A. Offer and Listing Details 75 Item 9.B. Plan of Distribution 75 Item 9.C. Markets 75 Item 9.D. Selling Shareholders 75 Item 9.E. Dilution 76 Item 9.F. Expenses of the Issuer 76 Item 10. Additional Information 76 Item 10.A. Share Capital 76 Item 10.B.
Significant Changes 83 Item 9. The Offer and Listing 84 Item 9.A. Offer and Listing Details 84 Item 9.B. Plan of Distribution 84 Item 9.C. Markets 84 Item 9.D. Selling Shareholders 84 Item 9.E. Dilution 84 Item 9.F. Expenses of the Issuer 84 Item 10. Additional Information 84 Item 10.A. Share Capital 84 Item 10.B.
History and Development of the Company 20 Item 4.B. Business Overview 21 Item 4.C. Organizational Structure 44 Item 4.D. Property, Plant and Equipment 44 Item 4A. Unresolved Staff Comments 46 Item 5. Operating and Financial Review and Prospects 46 Item 5.A. Operating Results 46 Item 5.B. Liquidity and Capital Resources 60 Item 5.C.
History and Development of the Company 20 Item 4.B. Business Overview 21 Item 4.C. Organizational Structure 45 Item 4.D. Property, Plant and Equipment 45 Item 4A. Unresolved Staff Comments 47 Item 5. Operating and Financial Review and Prospects 47 Item 5.A. Operating Results 47 Item 5.B. Liquidity and Capital Resources 68 Item 5.C.
Memorandum and Articles of Association 76 Item 10.C. Material Contracts 82 Item 10.D. Exchange Controls 82 Item 10.E. Taxation 86 Item 10.F. Dividends and Paying Agents 95 Item 10.G. Statements by Experts 95 Item 10.H. Documents on Display 95 Item 10.I. Subsidiary Information 95 Item 10.J. Annual Report to Security Holders 95 Item 11.
Memorandum and Articles of Association 84 Item 10.C. Material Contracts 91 Item 10.D. Exchange Controls 91 Item 10.E. Taxation 95 Item 10.F. Dividends and Paying Agents 103 Item 10.G. Statements by Experts 103 Item 10.H. Documents on Display 104 Item 10.I. Subsidiary Information 104 Item 10.J. Annual Report to Security Holders 104 Item 11.
Quantitative and Qualitative Disclosures About Market Risk 95 Item 12. Description of Securities Other than Equity Securities 98 Item 12.A. Debt Securities 98 Item 12.B. Warrants and Rights 98 Item 12.C. Other Securities 98 Item 12.D. American Depositary Shares 98 Part II 100
Quantitative and Qualitative Disclosures About Market Risk 104 Item 12. Description of Securities Other than Equity Securities 107 Item 12.A. Debt Securities 107 Item 12.B. Warrants and Rights 107 Item 12.C. Other Securities 107 Item 12.D. American Depositary Shares 107 Part II 109
Research and Development, Patents and Licenses, Etc. 63 Item 5.D. Trend Information 63 Item 5.E. Critical Accounting Estimates 63 Item 6. Directors, Senior Management and Employees 63 Item 6.A. Directors and Senior Management 63 Item 6.B. Compensation 67 Item 6.C. Board Practices 68 Item 6.D. Employees 69 Item 6.E. Share Ownership 71 Item 6.F.
Research and Development, Patents and Licenses, Etc. 71 Item 5.D. Trend Information 72 Item 5.E. Critical Accounting Estimates 72 Item 6. Directors, Senior Management and Employees 72 Item 6.A. Directors and Senior Management 72 Item 6.B. Compensation 75 Item 6.C. Board Practices 76 Item 6.D. Employees 78 Item 6.E. Share Ownership 79 Item 6.F.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Even though we strive to take all steps we believe are necessary to protect personal information, hardware, software or applications we develop or procure from third parties may contain defects or other problems that could unexpectedly compromise information security. For a discussion of our cybersecurity risk management and strategy, see “Item 16K.
Even though we strive to take all steps we believe are necessary to protect personal information, hardware, software or applications that we develop or procure from third parties may contain defects or other problems that could unexpectedly compromise information security. For a discussion of our cybersecurity risk management and strategy, see “Item 16K.
We are also pursuing registration of trademarks and domain names in Korea and in select jurisdictions outside of Korea. Effective protection of trademarks, domain names and other intellectual property is expensive and difficult to maintain, both in terms of application and registration costs as well as the costs of defending and enforcing those rights.
We are also pursuing the registration of trademarks and domain names in Korea and select jurisdictions outside of Korea. Effective protection of trademarks, domain names and other intellectual property is expensive and difficult to maintain, both in terms of application and registration costs, as well as the costs of defending and enforcing those rights.
If any litigation to which we are a party is resolved adversely, we may be subject to an unfavorable judgment that may not be reversed upon appeal. The terms of any such judgment or any settlement may require us to cease some or all of our operations, pay substantial amounts to the other party or seek licensing arrangements.
If any litigation to which we are a party is resolved adversely, we may be subject to an unfavorable judgment that may not be reversed upon appeal. The terms of such a judgment or any settlement may require us to cease some or all of our operations, pay substantial amounts to the other party or seek licensing arrangements.
As a result, including ourselves, there are currently three local telephone service providers, five domestic long-distance carriers and numerous international long-distance carriers (including voice resellers) in Korea. In addition, the Government awarded licenses to several service providers to promote competition in other telecommunications business areas such as mobile telephone services and data network services.
As a result, there are currently three local telephone service providers, five domestic long-distance carriers and numerous international long-distance carriers (including voice resellers) in Korea, including ourselves. In addition, the Government awarded licenses to several service providers to promote competition in other telecommunications business areas such as mobile telephone services and data network services.
In February 2022, after a summary judgment was issued, our 10 former executive officers filed for a formal trial. In July 2023, with respect to alleged violation of the Political Funds Act, the Seoul Central District Court found all 10 former executives guilty and imposed monetary penalties on each person ranging from ￦ 3 million to ￦ 7 million.
In February 2022, after a summary judgment was issued, the 10 former executive officers filed for a formal trial. In July 2023, with respect to the alleged violation of the Political Funds Act, the Seoul Central District Court found all 10 former executives guilty and imposed monetary penalties ranging from ￦ 3 million to ￦ 7 million on each person.
There can be no assurance that our intellectual property rights will be sufficient to protect against others offering services that are substantially similar to ours and compete with our business. We also rely on non-patented proprietary information and technology, such as trade secrets, confidential information, know-how and technical information.
There can be no assurance that our intellectual property rights will be sufficient to protect us against others offering services that are substantially similar to ours and compete with our business. We also rely on non-patented proprietary information and technology, such as trade secrets, confidential information, know-how and technical information.
There can be no assurance that, if BC Card requires additional capital in the future, it will be able to obtain such capital on favorable terms or at all, which could have a material adverse effect on the business, financial condition and results of operations of BC Card.
There can also be no assurance that, if BC Card requires additional capital in the future, it will be able to obtain such capital on favorable terms or at all, which could have a material adverse effect on the business, financial condition and results of operations of BC Card.
Our member companies that issue co-branded credit or check cards include Woori Card, NH Card, Industrial Bank of Korea and KB Kookmin Card. We also compete with service providers that provide outsourcing services related to business operations of credit card companies.
Our member companies that issue co-branded credit or check cards include NH Card, Industrial Bank of Korea and KB Kookmin Card. We also compete with service providers that provide outsourcing services related to business operations of credit card companies.
While we do not believe that COVID-19 had a material adverse impact on our business, risks associated with COVID-19 or other types of widespread infectious diseases may include: • increase in unemployment among our customers who may not be able to meet payment obligations, which in turn may decrease demand for our products and services; • service disruptions, outages and performance problems due to capacity constraints caused by an overwhelming number of people accessing our services simultaneously; • disruptions in the supply of mobile handsets or telecommunications equipment from our vendors; • fluctuations of the Won against major foreign currencies, which in turn may impact the cost of imported equipment necessary for expansion and enhancement of our telecommunications infrastructure; and • impairments in the fair value of our investments in companies that may be adversely affected by the pandemic.
While we do not believe that COVID-19 had a material adverse impact on our business, risks associated with similar widespread infectious diseases may include: • increase in unemployment among our customers who may not be able to meet payment obligations, which in turn may decrease demand for our products and services; • service disruptions, outages and performance problems due to capacity constraints caused by an overwhelming number of people accessing our services simultaneously; • disruptions in the supply of mobile handsets or telecommunications equipment from our vendors; • fluctuations of the Won against major foreign currencies, which in turn may impact the cost of imported equipment necessary for expansion and enhancement of our telecommunications infrastructure; and • impairments in the fair value of our investments in companies that may be adversely affected by the pandemic.
Following a period of deterioration due to the debilitating effects of the COVID-19 pandemic on the Korean economy as well as on the economies of Korea’s major trading partners in 2020, the overall Korean economy showed some signs of recovery in 2021.
Following a period of deterioration due to the debilitating effects of the COVID-19 pandemic on the Korean economy as well as on the economies of Korea’s major trading partners in 2020, the overall Korean economy showed signs of recovery in 2021.
The MSIT and the KCC also have the authority to regulate the pay TV industry under the Korea Broadcasting Act and the Internet Multimedia Broadcasting Services Act, which cover our IPTV services, our satellite TV services provided through KT Skylife (in which we held a 50.3% interest as of December 31, 2023), and cable TV services that we provide through HCN, in which KT Skylife holds a 100.0% interest.
The MSIT and the KCC also have the authority to regulate the pay TV industry under the Korea Broadcasting Act and the Internet Multimedia Broadcasting Services Act, which cover our IPTV services, our satellite TV services provided through KT Skylife (in which we held a 50.3% interest as of December 31, 2024), and cable TV services that we provide through KT HCN, in which KT Skylife holds a 100.0% interest.
Escalations in tensions with North Korea could have an adverse effect on us and the market value of our ADSs. Relations between Korea and North Korea have been tense throughout Korea’s modern history. The level of tension between the two Koreas has fluctuated and may increase abruptly as a result of current and future events.
Escalations in tensions with North Korea could have an adverse effect on us and the market value of our common shares and ADSs. Relations between Korea and North Korea have been tense throughout Korea’s modern history. The level of tension between the two Koreas has fluctuated and may increase abruptly as a result of current and future events.
Government regulation of the credit card industry may adversely affect the operations of BC Card in which we held a 69.5% interest as of December 31, 2023. Due to the rapid growth of the credit card market and rising consumer debt levels in Korea, the Government has heightened its regulatory oversight of the credit card industry in recent decades.
Government regulation of the credit card industry may adversely affect the operations of BC Card in which we held a 69.5% interest as of December 31, 2024. Due to the rapid growth of the credit card market and rising consumer debt levels in Korea, the Government has heightened its regulatory oversight of the credit card industry in recent decades.
Pursuant to the Settlement, which resolves these matters, and without admitting or denying any of the SEC’s findings (except for the SEC’s jurisdiction over us and the subject matter of the proceedings), we consented to the entry of an order in which the SEC made findings and ordered, pursuant to Section 21C of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that we cease and desist from 7 Table of Contents committing or causing any violations and any future violations of the books and records and internal accounting control provisions of the U.S.
Pursuant to the Settlement, which resolves these matters, and without admitting or denying any of the SEC’s findings (except for the SEC’s jurisdiction over us and the subject matter of the proceedings), we consented to the entry of an order in which the SEC made findings and ordered, pursuant to Section 21C of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that we cease and desist from committing or causing any violations and any future violations of the books and records and internal accounting control provisions of the U.S.
Depreciation of the Won may materially affect the results of our operations because, among other things, it causes an increase in the amount of Won required by us to make interest and principal payments on our foreign-currency- 12 Table of Contents denominated debt, the costs of telecommunications equipment that we purchase from overseas sources, net settlement payments to foreign carriers and certain payments related to our derivative instruments entered into for foreign exchange risk hedging purposes.
Depreciation of the Won may materially affect the results of our operations because, among other things, it causes an increase in the amount of Won required by us to make interest and principal payments on our foreign-currency-denominated debt, the costs of telecommunications equipment that we purchase from overseas sources, net settlement payments to foreign carriers and certain payments related to our derivative instruments entered into for foreign exchange risk hedging purposes.
Even if we were to successfully complete the transactions, the success of an acquisition or a joint venture depends largely on our ability to achieve the anticipated synergies, cost savings and growth opportunities from integrating the business of the acquired company or the joint venture with our current businesses.
Even if we were to successfully complete a transaction, the success of an acquisition or a joint venture depends largely on our ability to achieve the anticipated synergies, cost savings and growth opportunities from integrating the business of the acquired company or the joint venture with our current businesses.
One key aspect of our overall business strategy calls for acquisitions of businesses and entering into joint ventures that complement or diversify our current businesses. For example, in September 2021, KT Skylife Co., Ltd. (“KT Skylife”), in which we held a 50.3% interest as of December 31, 2023, completed its acquisition of a 100.00% interest in Hyundai HCN Co., Ltd.
One key aspect of our overall business strategy calls for acquisitions of businesses and entering into joint ventures that complement or diversify our current businesses. For example, in September 2021, KT Skylife Co., Ltd. (“KT Skylife”), in which we held a 50.3% interest as of December 31, 2024, completed its acquisition of a 100.00% interest in KT HCN Co., Ltd.
In addition, because the techniques used to obtain unauthorized access or sabotage systems change frequently and may be difficult to detect for long periods of time, we may be unable to anticipate these techniques or implement adequate preventive measures.
In addition, because the techniques used to gain unauthorized access or sabotage systems change frequently and may be difficult to detect for long periods of time, we may be unable to anticipate these techniques or implement adequate preventive measures.
We have experienced, and may in the future experience, service disruptions, outages and other performance problems due to a variety of factors, including infrastructure changes, human or software errors, hardware failures, capacity constraints due to an overwhelming number of people accessing our services simultaneously, 8 Table of Contents computer viruses, power losses, fraud and security attacks.
We have experienced, and may in the future experience, service disruptions, outages and other performance problems due to a variety of factors, including infrastructure changes, human or software errors, hardware failures, capacity constraints due to an overwhelming number of people accessing our services simultaneously, computer viruses, power losses, fraud and security attacks.
Furthermore, from time to time, we may introduce or acquire new services or content, including in areas where we currently do not compete, which could increase our exposure to intellectual property claims from competitors and non-practicing entities. As we face increasing competition, the number and scope of intellectual property claims against us may grow.
Furthermore, from time to time, we may introduce or acquire new 10 Table of Contents services or content, including in areas where we currently do not compete, which could increase our exposure to intellectual property claims from competitors and non-practicing entities. As we face increasing competition, the number and scope of intellectual property claims against us may grow.
Among other things, we began to exercise greater autonomy in setting our annual budget and making investments in the telecommunications industry, and our shareholders began electing our directors, who had previously been appointed by the Government under the Korea Telecom Act. Prior to 1993, the Government owned all of the issued shares of our common stock.
Among other things, we began to exercise greater autonomy in setting our annual budget and making investments in the telecommunications industry, and our shareholders began electing our directors, who had previously been appointed by the Government under the Korea Telecom Act. 20 Table of Contents Prior to 1993, the Government owned all of the issued shares of our common stock.
In addition, any patents and trademarks may be contested, circumvented, or found unenforceable or invalid, and we may not be able to prevent third parties from infringing, diluting or otherwise violating them.
In addition, our patents and trademarks may be contested, circumvented, or found unenforceable or invalid, and we may not be able to prevent third parties from infringing, diluting or otherwise violating them.
Any loss or interruption of the services of these 10 Table of Contents individuals, whether from retirement, loss to competitors or other causes, or failure to attract and retain other qualified new personnel, could prevent us from effectively executing our business strategy, cause us to lose key business relationships, or otherwise materially affect our operations.
Any loss or interruption of the services of these individuals, whether from retirement, loss to competitors or other causes, or failure to attract and retain other qualified new personnel, could prevent us from effectively executing our business strategy, cause us to lose key business relationships, or otherwise materially affect our operations.
Securities and Exchange Commission (the “SEC”) to resolve its investigation (described below) and (ii) inaction to take responsibility for alleged violation of the Political Funds Act by our current and former executives described above. This matter is currently being investigated by the Seoul Central District Prosecutor’s Office.
Securities and Exchange Commission (the “SEC”) to resolve its investigation (described below) and (ii) inaction to take responsibility for the alleged violation of the Political Funds Act by our current and former executives described above. This matter is currently under investigation by the Seoul Central District Prosecutor’s Office.
In addition, various “non-practicing entities” that own intellectual property rights often attempt to aggressively assert claims in order to extract payments from companies like us. From time to time, we have received, and may receive in the future, claims from third parties which allege that we have infringed upon their intellectual property rights.
In addition, various “non-practicing entities” that own intellectual property rights often attempt to aggressively assert claims in order to extract payments from companies like us. From time to time, we have received, and may receive in the future, claims from third parties alleging that we have infringed upon their intellectual property rights.
If we offer any rights to subscribe for additional ordinary shares or any rights of any other nature, the depositary bank, after consultation with us, may make the rights available to an ADS holder or use reasonable efforts to dispose of the rights on behalf of the ADS holder and make the net proceeds available to the ADS holder.
If we offer any rights to subscribe for 19 Table of Contents additional ordinary shares or any rights of any other nature, the depositary bank, after consultation with us, may make the rights available to an ADS holder or use reasonable efforts to dispose of the rights on behalf of the ADS holder and make the net proceeds available to the ADS holder.
The current trend of increasing data transmission use and the increasing sophistication of multimedia contents are 3 Table of Contents likely to put additional strain on the bandwidth capacity of mobile service providers.
The current trend of increasing data transmission use and the increasing sophistication of multimedia contents are likely to put additional strain on the bandwidth capacity of mobile service providers.
Pursuing acquisitions or joint venture transactions also requires significant capital, and as we pursue further growth opportunities for the future, we may need to raise 4 Table of Contents additional capital through incurring loans or through issuances of bonds or other securities in the international capital markets.
Pursuing acquisitions or joint venture transactions also requires significant capital, and as we pursue further growth opportunities for the future, we may need to raise additional capital through incurring loans or through issuances of bonds or other securities in the international capital markets.
Litigation can be time-consuming and expensive to resolve, and can divert management time and attention from business operation. We are not aware of any basis upon which such suit may be brought against us, nor are any such suits pending or threatened.
Litigation can be time-consuming and expensive to resolve, and can divert 17 Table of Contents management time and attention from business operation. We are not aware of any basis upon which such suit may be brought against us, nor are any such suits pending or threatened.
With the launch of 5G mobile services in April 2019, competition has further intensified among the three network service providers, which has resulted in an increase in marketing expenses as well as additional capital 2 Table of Contents expenditures related to implementing 5G mobile services.
With the launch of 5G mobile services in April 2019, competition has further intensified among the three network service providers, which has resulted in an increase in marketing expenses as well as additional capital expenditures related to implementing 5G mobile services.
Memorandum and Articles of Association—Limitations on Shareholding.” 18 Table of Contents Holders of ADSs will not be able to exercise appraisal rights unless they have withdrawn the underlying ordinary shares and become our direct shareholders.
Memorandum and Articles of Association—Limitations on Shareholding.” Holders of ADSs will not be able to exercise appraisal rights unless they have withdrawn the underlying ordinary shares and become our direct shareholders.
The value of the Won relative to major foreign currencies has fluctuated significantly and, as a result of uncertain global and Korean economic conditions, there has been significant volatility in the stock prices of Korean companies recently.
The value of the Won relative to major foreign currencies has fluctuated significantly and, as a result of uncertain global and Korean economic conditions, there has been significant volatility in the stock prices of Korean companies in recent periods.
The economic indicators in Korea in recent years have shown mixed signs of deterioration and recovery, and future growth of the Korean economy is subject to many factors beyond our control, including developments in the global economy.
The economic indicators in Korea in recent years have shown mixed signs of growth and uncertainty, and future growth of the Korean economy is subject to many factors beyond our control, including developments in the global economy.
We may be unable to obtain patent or trademark protection for our technologies and brands, and our existing patents and trademarks, and any patents or trademarks that may be issued in the future, may not provide us with competitive advantages or distinguish our products and services from those of our competitors.
However, we may be unable to obtain patent or trademark protection for our technologies and brands, and our existing patents and trademarks, as well as any patents or trademarks that may be issued in the future, may not provide us with competitive advantages or effectively distinguish our products and services from those of our competitors.
Any future determination by the Korea Fair Trade Commission that we have engaged in transactions that violate the fair trade laws and regulations may result in fines or other punitive measures and may have a material adverse effect on our reputation and our business.
Any future determination by 12 Table of Contents the Korea Fair Trade Commission that we have engaged in transactions that violate the fair trade laws and regulations may result in fines or other punitive measures and may have a material adverse effect on our reputation and our business.
Additional Information—Item 10.D. Exchange Controls.” A foreign investor may not be able to exercise voting rights with respect to common shares exceeding certain restrictions. Under the Telecommunications Business Act, a foreign shareholder who holds 5.0% or more of our total shares is prohibited from becoming our largest shareholder.
Exchange Controls.” A foreign investor may not be able to exercise voting rights with respect to common shares exceeding certain restrictions. Under the Telecommunications Business Act, a foreign shareholder who holds 5.0% or more of our total shares is prohibited from becoming our largest shareholder.
We also seek to obtain patent protection for some of our technology, and we have filed various applications in Korea and elsewhere for protection of certain aspects of our intellectual property and 9 Table of Contents currently hold a number of issued patents in multiple jurisdictions.
We also seek to obtain patent protection for some of our technology and have filed various applications in Korea and elsewhere to protect certain aspects of our intellectual property. We currently hold a number of issued patents in multiple jurisdictions.
For all of our bandwidth licenses, we made aggregate payments of ￦ 603 billion in 2021, ￦ 319 billion in 2022 and ￦ 327 billion in 2023. For our outstanding payment obligations relating to our bandwidth licenses, see “Item 5. Operating and Financial Review and Prospects—Item 5.A.
For all of our bandwidth licenses, we made aggregate payments of ￦ 319 billion in 2022, ￦ 327 billion in 2023 and ￦ 299 billion in 2024. For our outstanding payment obligations relating to our bandwidth licenses, see “Item 5. Operating and Financial Review and Prospects—Item 5.A.
(“HCN”), which is Korea’s fifth largest cable operator. While we plan to continue our search for suitable acquisition and joint venture opportunities, we cannot provide assurance that we will be able to identify attractive opportunities or that we will successfully complete the transactions without encountering administrative, technical, political, financial or other difficulties, or at all.
(formerly known as “HCN”), which is Korea’s fifth largest cable operator. While we plan to continue searching for suitable acquisition and joint venture opportunities, we cannot provide assurance that we will be able to identify attractive opportunities or that we will successfully complete the transactions without encountering administrative, technical, political, financial or other difficulties, or at all.
In particular, there have been heightened security concerns in recent years stemming from North Korea’s nuclear weapon, ballistic missile and satellite programs as well as its hostile military actions against Korea.
In particular, there have been heightened security concerns in 16 Table of Contents recent years stemming from North Korea’s nuclear weapon, ballistic missile and satellite programs as well as its hostile military actions against Korea.
Cybersecurity.” Unauthorized parties may also attempt to circumvent our security measures to gain access to our systems or facilities through fraud, trickery or other forms of deceiving our employees, contractors and temporary staff.
Cybersecurity.” Unauthorized parties may also attempt to circumvent our security measures to gain access to our systems or facilities through fraud, trickery or other forms of deception aimed at our employees, contractors and temporary staff.
In addition, under the Telecommunications Business Act, the MSIT may, if it deems it necessary to preserve substantial public interests, prohibit a foreign shareholder from being our largest shareholder.
In addition, under the Telecommunications Business Act, the MSIT may, if it deems it necessary to preserve substantial public interests, prohibit a foreign shareholder from being 18 Table of Contents our largest shareholder.
Although the impact of exchange rate fluctuations has in the past been partially mitigated by such strategies, our results of operations have historically been affected by exchange rate fluctuations, and there can be no assurance that such strategies will be sufficient to reduce or eliminate the adverse impact of such fluctuations in the future. See “—Item 3.A.
Although the impact of exchange rate fluctuations has in the past been partially mitigated by such strategies, our results of operations have historically been affected by exchange rate fluctuations, and there can be no assurance that such strategies will be sufficient to reduce or eliminate the adverse impact of such fluctuations in the future. See “Item 5.
Until such time, however, the depositary bank will continue to obtain our consent for such deposits of shares and delivery of ADSs, 17 Table of Contents which we may not provide. Consequently, if an investor surrenders his ADSs to withdraw the underlying shares, he may not be allowed to deposit the shares again to obtain ADSs. See “Item 10.
Until such time, however, the depositary bank will continue to obtain our consent for such deposits of shares and delivery of ADSs, which we may not provide. Consequently, if an investor surrenders his ADSs to withdraw the underlying shares, he may not be allowed to deposit the shares again to obtain ADSs. See “Item 10. Additional Information—Item 10.D.
Soon-sil Choi, a confidante of former President Geun-hye Park, and certain payments made by certain of our employees between 2014 and 2018 with respect to procurement of two government contracts in Vietnam.
Soon-sil Choi, a confidante of former President Geun-hye Park, and certain payments made by some of our employees between 2014 and 2018 in connection with the procurement of two government contracts in Vietnam.
If our users are unable to readily access our services or access is disrupted, users may seek other service providers instead, and may not return to our services or use our services as often in the future. This would negatively impact our ability to attract subscribers, cardholders and other business partners as well as increase engagement of our customers.
If our users are unable to easily access our services or if access is disrupted, they may seek other service providers and may not return to our services or use them as often in the future. This could negatively impact our ability to attract subscribers, cardholders and other business partners as well as increase engagement of our customers.
The Government may pursue additional measures to regulate the markets in which we compete. There can be no assurance that we will not adopt additional measures that reduce rates charged to our subscribers as well as adjustments to our handset subsidies and other measures in the future to comply with regulatory requirements or the Government’s policy guidelines.
There can be no assurance that we will not adopt additional measures that reduce rates charged to our subscribers as well as adjustments to our handset subsidies and other measures in the future to comply with regulatory requirements or the Government’s policy guidelines.
Of the ￦ 10,218 billion total borrowings (including short-term borrowings) outstanding as of December 31, 2023, ￦ 2,801 billion was denominated in foreign currencies. Upon identification and evaluation of our currency risk exposures, we, having considered various circumstances, enter into derivative financial instruments to try to mitigate such risks.
Of the ￦ 10,521 billion total borrowings (including short-term borrowings) outstanding as of December 31, 2024, ￦ 3,336 billion was denominated in foreign currencies. Upon identification and evaluation of our currency risk exposures, we, having considered various circumstances, enter into derivative financial instruments to try to mitigate such risks.
Future declines in the KOSPI, and large amounts of sales of Korean securities by foreign investors and subsequent repatriation of the proceeds of such sales may adversely affect the value of the Won, the foreign currency reserves held by financial institutions in Korea, and the ability of Korean companies to raise capital.
Future declines in the Korea Composite Stock Price Index (the “KOSPI”), and large amounts of sales of Korean securities by foreign investors and subsequent repatriation of the proceeds of such sales may adversely affect the value of the Won, the foreign currency reserves held 14 Table of Contents by financial institutions in Korea, and the ability of Korean companies to raise capital.
In the past, we have experienced cyber-attacks of varying degrees from time to time, including theft of personal information of our subscribers by third parties that have led to lawsuits and administrative actions against us alleging that the leak was related to our mismanagement of subscribers’ personal information.
In the past, we have experienced cyber-attacks of varying degrees, including incidents involving the theft of personal information of our subscribers by third parties. These incidents have led to lawsuits and administrative actions against us, alleging that the leaks were related to our mismanagement of subscribers’ personal information.
Any future deterioration of the Korean economy could adversely affect our business, financial condition and results of operations and the market price of our ADSs.
Any future deterioration of the Korean or global economy could adversely affect our business, financial condition and results of operations.
To the extent a credit card company fails to maintain such ratio, Korean regulatory authorities may impose penalties on such company ranging from a warning to a suspension or revocation of its license. BC Card’s capital adequacy ratios were 35.8% as of December 31, 2021, 27.3% as of December 31, 2022 and 25.4% as of December 31, 2023.
If a credit card company fails to maintain such ratio, Korean regulatory authorities may impose penalties ranging from 11 Table of Contents a warning to a suspension or revocation of its license. BC Card’s capital adequacy ratios were 27.3% as of December 31, 2022, 25.4% as of December 31, 2023 and 29.9% as of December 31, 2024.
In March 2023, a civic group filed a complaint with the Seoul Central District Prosecutor’s Office against Hyeon-mo Ku, our former chief executive officer, and Kyoung-Lim Yun, our former president, alleging breach of fiduciary duty in connection with various matters, particularly (i) their alleged involvement in Hyundai Motor Company’s acquisition of AirPlug Co., Ltd., a company operated by the brother of Hyeon-mo Ku and (ii) Hyeon-mo Ku’s alleged inappropriate funneling of subcontracting work of KT Telecop Co., Ltd. to KDFS Co., Ltd., a facility management company.
In March 2023, a civic group filed a complaint with the Seoul Central District Prosecutor’s Office against Hyeon-mo Ku, our former chief executive officer, and Kyoung-Lim Yun, our former president, alleging breach of fiduciary duty in connection with various matters, particularly (i) their alleged involvement in Hyundai Motor Company’s acquisition of AirPlug Co., Ltd.
Other developments that could have an adverse impact on Korea’s economy include: • declines in consumer confidence and a slowdown in consumer spending, including as a result of severe health epidemics; • hostilities or, political or social tensions involving Russia (including the invasion of Ukraine by Russia and ensuing actions that the United States and other countries have taken and may take in the future) and any resulting adverse effects on the global supply of oil and other natural resources or the global financial markets; • adverse conditions or developments in the economies of countries and regions that are important export markets for Korea, such as China, the United States, Europe and Japan, or in emerging market economies in Asia or elsewhere, including as a result of the deteriorating economic and trade relations between the United States and China and increased uncertainties in the global financial markets and industry; • adverse changes or volatility in foreign currency reserve levels, inflation rates, interest rates, commodity prices (including oil prices), exchange rates (including fluctuation of the U.S. dollar, the Euro or the Japanese Yen exchange rates or revaluation of the Chinese Yuan) or stock markets; • the occurrence of severe health epidemics in Korea or other parts of the world, in addition to the COVID-19 pandemic; 14 Table of Contents • deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including deterioration resulting from territorial or trade disputes or disagreements in foreign policy; • increased sovereign default risk in select countries and the resulting adverse effects on the global financial markets; • deterioration in the financial condition or performance of small- and medium-sized enterprises and other companies in Korea due to the Government’s policies to increase minimum wages and limit working hours of employees; • investigations of large Korean business groups and their senior management for possible misconduct; • continuing rise in the level of household debt and increasing delinquencies and credit defaults by retail and small- and medium-sized enterprise borrowers in Korea; • shortages of imported raw materials, natural resources, rare earth minerals or component parts due to disruptions to the global supply chain; • the economic impact of any pending or future free trade agreements or of any changes to existing free trade agreements; • social and labor unrest; • substantial changes in the market prices of Korean real estate; • a substantial decrease in tax revenues and a substantial increase in the Government’s expenditures for fiscal stimulus measures, unemployment compensation and other economic and social programs, in particular in light of the Government’s ongoing efforts to provide emergency relief payments to households and emergency loans to corporations in need of funding in light of COVID-19 as well as interest rate increases, which, together, would likely lead to a national budget deficit as well as an increase in the Government’s debt; • financial problems or lack of progress in the restructuring of Korean business groups, other large, troubled companies, their suppliers or the financial sector; • loss of investor confidence arising from corporate accounting irregularities or corporate governance issues concerning certain Korean companies; • increases in social expenditures to support an aging population in Korea or decreases in economic productivity due to the declining population size in Korea; • geopolitical uncertainty and the risk of further attacks by terrorist groups around the world; • political uncertainty or increasing strife among or within political parties in Korea; • hostilities or political or social tensions involving oil-producing countries in the Middle East (including the escalation of hostilities in the Middle East following the Israel-Hamas war) and Northern Africa and any material disruption in the global supply of oil or sudden increase in the price of oil; 15 Table of Contents • natural or man-made disasters that have a significant adverse economic or other impact on Korea or its major trading partners; and • an increase in the level of tensions or an outbreak of hostilities between North Korea and Korea or the United States.
Other developments that could have an adverse impact on Korea’s economy include: • declines in consumer confidence and a slowdown in consumer spending, including as a result of severe health epidemics and increases in market interest rates; • political uncertainty or increasing strife among or within political parties in Korea and the ensuing societal unrest, including as a result of political uncertainty following the removal of President Yoon from office on April 4, 2025 by the Constitutional Court of Korea, which upheld the National Assembly’s vote to impeach him following his declaration of martial law in December 2024 (which declaration had been swiftly rescinded), as a result of which a special presidential election to elect his successor will be held on June 3, 2025; • rising inflationary pressures leading to increases in costs of goods and services and a decrease in purchasing power; • hostilities or political or social tensions involving Russia (including the invasion of Ukraine by Russia and ensuing actions that the United States and other countries have taken and may take in the future) and any resulting adverse effects on the global supply of oil and other natural resources or the global financial markets; • adverse conditions or developments in the economies of countries and regions that are important export markets for Korea, such as China, the United States, Europe and Japan, or in emerging market economies in Asia or elsewhere, including as a result of the deteriorating economic and trade relations between the United States and such other countries (including the imposition of significant tariffs by the United States on its trading partners, which has been followed by retaliatory tariffs in some cases) and increased uncertainties in the global financial markets and industry; • the imposition of significant tariffs on Korea’s exports by any of its major export markets, such as the imposition of a 25% tariff on Korea’s exports to the United States announced in April 2025, which has since been paused for a period of 90 days; • adverse changes or volatility in foreign currency reserve levels, commodity prices (including oil prices), exchange rates (including fluctuation of the U.S. dollar, Euro or Japanese Yen exchange rates or revaluation of the Chinese Yuan), interest rates or stock markets; • the occurrence of severe health epidemics in Korea or other parts of the world, in addition to the COVID-19 pandemic; • a deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including deterioration resulting from territorial or trade disputes or disagreements in foreign policy; • increased sovereign default risks in select countries and the resulting adverse effects on the global financial markets; • a deterioration in the financial condition or performance of small- and medium-sized enterprises and other companies in Korea; 15 Table of Contents • investigations of large Korean business groups and their senior management for possible misconduct; • a continuing rise in the level of household debt and increasing delinquencies and credit defaults by retail and small- and medium-sized enterprise borrowers in Korea; • shortages of imported raw materials, natural resources, rare earth minerals or component parts due to disruptions to the global supply chain; • the economic impact of any pending or future free trade agreements or of any changes to existing free trade agreements; • social and labor unrest; • substantial changes in the market prices of Korean real estate; • a substantial decrease in tax revenues and a substantial increase in the Government’s expenditures for fiscal stimulus measures, unemployment compensation and other economic and social programs, which, together, would likely lead to a national budget deficit as well as an increase in the Government’s debt; • financial problems or lack of progress in the restructuring of Korean business groups, other large troubled companies, their suppliers or the financial sector; • loss of investor confidence arising from corporate accounting irregularities or corporate governance issues concerning certain Korean companies; • increases in social expenditures to support an aging population in Korea or decreases in economic productivity due to the declining population size in Korea; • geopolitical uncertainty and the risk of further attacks by terrorist groups around the world; • hostilities or political or social tensions involving countries in the Middle East (including those resulting from the escalation of hostilities in the Middle East following the Israel-Hamas war) and Northern Africa and any material disruption in the global supply of oil or sudden increase in the price of oil; • natural or man-made disasters that have a significant adverse economic or other impact on Korea or its major trading partners; and • an increase in the level of tensions or an outbreak of hostilities between North Korea and Korea or the United States.
Selected Financial Data—Exchange Rate Information”, “Item 5. Operating and Financial Review and Prospects—Item 5.B. Liquidity and Capital Resources” and “Item 11.
Operating and Financial Review and Prospects—Item 5.B. Liquidity and Capital Resources” and “Item 11.
In November 2021, the Seoul Central District Prosecutor’s Office also issued a summary indictment against our former representative director and chief executive officer, Hyeon-mo Ku, and nine other former executive officers, who permitted using their names, for violating charges that include violation of the Political Funds Act and embezzlement.
In November 2021, the Seoul Central District Prosecutor’s Office issued a summary indictment against our former representative director and chief executive officer, Hyeon-mo Ku, and nine other former executive officers, who had permitted the use of their names. They were indicted on charges including violations of the Political Funds Act and embezzlement.
Any further increase in tensions, which may occur, for example, if North Korea experiences a leadership crisis, high-level contacts between Korea and North Korea or between the United States and North Korea break down or military hostilities occur, could have a material adverse effect on the Korean economy and on our business, financial condition and results of operations and the market value of our ADSs. 16 Table of Contents Korea’s legislation allowing class action suits related to securities transactions may expose us to additional litigation risk.
Any further increase in tensions, which may occur, for example, if North Korea experiences a leadership crisis, high-level contacts between Korea and North Korea or between the United States and North Korea break down or military hostilities occur, could have a material adverse effect on the Korean economy and on our business, financial condition and results of operations and the market value of our common shares and ADSs.
Our business operations and acts of our management, employees and other relevant parties are subject to various laws and regulations in and outside Korea.
We are subject to various laws and regulations in Korea and other jurisdictions, including the Monopoly Regulation and Fair Trade Act of Korea. Our business operations and acts of our management, employees and other relevant parties are subject to various laws and regulations in and outside Korea.
The Seoul Central District Prosecutor’s Office appealed such decisions, which remain pending at the Appellate Division of the Seoul Central District Court. In October 2023, with respect to alleged violation of embezzlement, the Seoul Central District Court found all 10 former executives guilty and imposed monetary penalties on each person ranging from ￦ 2 million to ￦ 3 million.
In October 2023, with respect to the alleged embezzlement violations, the Seoul Central District Court found all 10 former executives guilty and imposed monetary penalties ranging from ￦ 2 million to ￦ 3 million on each person.
In December 2013, the Supreme Court of Korea ruled that regular bonuses (including those that are paid other than on a monthly basis) shall be deemed ordinary wages if these bonuses are paid “regularly” and “uniformly” on a “fixed basis” notwithstanding differential amounts based on seniority.
In December 2013, the Supreme Court of Korea ruled that regularly paid bonuses, including those that are paid other than on a monthly basis, are included in the scope of employees’ ordinary wages if these bonuses are paid (i) “regularly,” (ii) “uniformly” and (iii) on a “fixed basis,” notwithstanding differential amounts based on seniority.
Any such amendments to, or the repeal of, the Mobile Device 5 Table of Contents Distribution Improvement Act may have a material impact on the competitive landscape of the mobile telecommunications industry as mobile service providers are given more flexibility to provide handset subsidies or discounts, which may in turn increase expenses.
The repeal of the Mobile Device Distribution Improvement Act may have a material impact on the competitive landscape of the mobile telecommunications industry, as mobile service providers are given more flexibility to offer handset subsidies or discounts, which may in turn increase expenses. The Government may pursue additional measures to regulate the markets in which we compete.
See “— COVID-19 and any possible occurrences of other types of widespread infectious diseases could materially and adversely affect our business, financial condition or results of operations.” However, adverse conditions and volatility in the worldwide financial markets, fluctuations in oil and commodity prices, supply chain disruptions and the increasing weakness of the global economy, in particular due to the COVID-19 pandemic, and beginning in the second half of 2021, rapid increases in interest rates globally to combat inflation, have contributed to the uncertainty of global economic prospects in general and have adversely affected, and may continue to adversely affect, the Korean economy.
However, adverse conditions and volatility in the worldwide financial markets, fluctuations in oil and commodity prices, supply chain disruptions and the increasing weakness of the global economy, in particular due to the COVID-19 pandemic, and beginning in the second half of 2021 until recent months, rapid increases in interest rates globally to combat inflation, have contributed to the uncertainty of global economic prospects in recent years and have adversely affected, and may continue to adversely affect, the Korean economy.
In particular, our focus on leading the market in introducing new telecommunications and Internet-related services has meant that we must aggressively recruit engineers with expertise in cutting-edge technologies.
In particular, our focus on leading the market in introducing new telecommunications, Internet-related and artificial intelligence (“AI”)-related services requires us to aggressively recruit engineers with expertise in cutting-edge technologies.
Accordingly, our failure to prevent cybersecurity breaches may materially and adversely impact our business, financial condition and results of operations. Our business and performance may be harmed by a disruption in our services due to failures in or changes to our systems, or by our failure to timely and effectively expand and upgrade our technology and infrastructure.
Our business and performance may be harmed by a disruption in our services due to failures in or changes to our systems, or by our failure to timely and effectively expand and upgrade our technology and infrastructure.
Although we have been able to reach collective bargaining agreements and wage agreements with our labor union in recent years, there can be no assurance that we will not experience labor disputes and unrest resulting from disagreements with the labor union in the future. 11 Table of Contents We are subject to various laws and regulations in Korea and other jurisdictions, including the Monopoly Regulation and Fair Trade Act of Korea.
Although we have been able to reach collective bargaining agreements and wage agreements with our labor union in recent years, there can be no assurance that we will not experience labor disputes and unrest resulting from disagreements with the labor union in the future.
Under the Mobile Device Distribution Improvement Act, a subscriber is entitled to receive either a designated handset subsidy related to the purchase of a recently released mobile phone, or a designated discount on the mobile service subscription rate.
The Mobile Device Distribution Improvement Act permitted subscribers to choose between a designated handset subsidy for the purchase of a recently released mobile phone or a designated discount on the mobile service subscription rate.
The form of our standard agreement for providing local network services and each agreement for interconnection with other service providers must also be reported to the MSIT.
Accordingly, changes in our local telephone rates and mobile rates of SK Telecom are required to be reported to the MSIT, which has 15 days to object to such changes. The form of our standard agreement for providing local network services and each agreement for interconnection with other service providers must also be reported to the MSIT.
Our principal executive offices are located at KT Gwanghwamun Building East, 33, Jong-ro 3-gil, Jongno-gu, 03155, Seoul, Korea, our telephone number is +82-2-3495-3557 and the address of our English website is https://corp.kt.com/eng/ .
Our principal executive offices are located at KT Gwanghwamun Building East, 33, Jong-ro 3-gil, Jongno-gu, 03155, Seoul, Korea, our telephone number is +82-70-4193-4036 and the address of our English website is https://corp.kt.com/eng/ . The SEC maintains a website ( http://www.sec.gov ), which contains reports, information statements and other information regarding issuers that file electronically with the SEC.
No assurance can be given that our new services will gain broad market acceptance such that we will be able to derive revenue from such services to justify the license fees, capital expenditures and other investments required to provide such services .
Furthermore, we are continually upgrading our broadband network to enable better fiber-to-the-home (“FTTH”) connection, which enhances data transmission speed and connection quality. 4 Table of Contents No assurance can be given that our new services will gain broad market acceptance such that we will be able to derive revenue from such services to justify the license fees, capital expenditures and other investments required to provide such services .
Furthermore, pursuant to an amendment to the Telecommunications Business Act that became effective in December 2022, this exemption from the restriction of foreign ownership of a network service provider beyond the 49.0% threshold applies not only to a foreign government or a foreigner from an FTA Country but also to a foreign government or a foreigner from an OECD country.
Furthermore, this exemption from the restriction of foreign ownership of a network service provider beyond the 49.0% threshold applies not only to a foreign government or a foreigner from an FTA Country but also to a foreign government or a foreigner from an Organization for Economic Co-operation and Development (“OECD”) country.
To a lesser extent, we also compete with various value-added service providers and network service providers as classified under the Framework Act on Telecommunications and the Telecommunications Business Act, including mobile virtual network operators (“MVNOs”) that lease mobile networks and offer mobile services, VoIP service providers that offer Internet telephone services, cable TV operators, text messaging service providers (particularly Kakao Corp.
In recent years, each of our primary competitors has acquired a leading cable TV operator in Korea to significantly increase their market shares in the pay TV market, which has further intensified competition. 2 Table of Contents To a lesser extent, we also compete with various value-added service providers and network service providers as classified under the Framework Act on Telecommunications and the Telecommunications Business Act, including MVNOs that lease mobile networks and offer mobile services, VoIP service providers that offer Internet telephone services, cable TV operators, text messaging service providers (particularly Kakao Corp.
Competition in the credit card and check card businesses has increased substantially as existing credit card companies, consumer finance companies and other financial institutions in Korea have made significant investments and engaged in aggressive marketing campaigns and promotions for their credit and check cards, as well as investing in operational infrastructure that may reduce the need for our outsourcing services.
Competition in the credit card and check card businesses has intensified as existing credit card companies, consumer finance companies and other financial institutions in Korea have made significant investments and engaged in aggressive marketing campaigns and promotions for their credit and check cards, as well as invested in operational infrastructure that may reduce the need for our outsourcing services. 3 Table of Contents Our inability to adapt to changes in the competitive landscape and compete against our competitors in our principal business areas could have a material adverse effect on our business, financial condition and results of operations.
As part of the Settlement, we paid disgorgement of approximately $2.8 million (including prejudgment interest) and a civil penalty of $3.5 million to the SEC, and agreed to periodically report to the SEC staff for a two year term the status of our remediation and implementation of compliance measures for ensuring compliance with the FCPA and other applicable anti-corruption laws, which period was completed in April 2024.
We also agreed to periodically report to the SEC staff on the status of our remediation and implementation of compliance measures to ensure compliance with the FCPA and other applicable anti-corruption laws for a two-year term, which concluded in April 2024.
There is no guarantee that the laws and regulations to which we are or become subject will not have a material adverse effect on our business, financial condition or results of operations. COVID-19 and any possible occurrences of other types of widespread infectious diseases could materially and adversely affect our business, financial condition or results of operations.
There is no guarantee that the laws and regulations to which we are or become subject will not have a material adverse effect on our business, financial condition or results of operations. 6 Table of Contents Legal cases involving our political donations and other incidents and allegations could have a material adverse effect on our business, reputation and stock price.
Effective October 1, 1997, the Korea Telecom Act was repealed and the Government-Invested Enterprises Management Basic Act became inapplicable to us. As a result, we became a corporation under the Commercial Code, and our corporate organization and shareholders’ rights were governed by the Government’s privatization laws and the Commercial Code.
As a result, we became a corporation under the Commercial Code, and our corporate organization and shareholders’ rights were governed by the Government’s privatization laws and the Commercial Code.
In January 2024, Stage X, a consortium led by Stage Five, won the auction for 800 MHz of bandwidth license on the 28 GHz spectrum. Stage X is expected to commence service in the first half of 2025 to become the fourth nationwide mobile service provider, subject to satisfaction of applicable regulatory requirements.
In January 2024, Stage X, a consortium led by Stage Five, won the auction for 800 MHz of bandwidth license on the 28 GHz spectrum.
Our intellectual property rights are valuable, and our inability to protect them could reduce the value of our products, services and brands. Our trade secrets, trademarks, copyrights, patents and other intellectual property rights are important assets for us.
Our trade secrets, trademarks, copyrights, patents and other intellectual property rights are important assets for us.
These fluctuations will also affect the Dollar conversion by the depositary for the American Depositary Receipts (“ADRs”) of cash dividends, if any, paid in Won on our ordinary shares represented by the ADSs.
These fluctuations will also affect the Dollar conversion by the depositary for the American Depositary Receipts (“ADRs”) of cash dividends, if any, paid in Won on our ordinary shares represented by the ADSs. 13 Table of Contents We may be exposed to potential claims for unpaid wages and become subject to additional labor costs arising from the Supreme Court of Korea’s interpretation of ordinary wages.
This matter is currently being investigated by the Seoul Central District Prosecutor’s Office. In February 2022, we entered into a settlement (the “Settlement”) with the SEC to resolve its investigation, among others, regarding charitable and political donations and other incidents and allegations, including matters connected to a scandal involving Ms.
In February 2022, we entered into a settlement (the “Settlement”) with the SEC to resolve its investigation, which included matters related to charitable and political donations, as well as other incidents and allegations. These included connections to a scandal involving Ms.
Any such additional payments may have an adverse effect on our financial condition and results of operations. 13 Table of Contents Risks Relating to Korea If economic conditions in Korea deteriorate, our current business and future growth could be materially and adversely affected. We are incorporated in Korea, and we generate most of our operating revenue in Korea.
Risks Relating to Korea If economic conditions in Korea deteriorate, our current business and future growth could be materially and adversely affected. We are incorporated in Korea, and we generate most of our operating revenue in Korea. As a result, we are subject to economic, political, legal and regulatory risks specific to Korea.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Unlimited, but decelerate to 1 Mbps after 5 GB LTE Basic ￦ 33,000 Unlimited 50 min. 1.4 GB with an option to transfer data from and into the next month’s usage In addition to our mobile service plans, we offer value-added services for additional monthly fees that can be added to the subscription such as media packages, mobile TV packages, additional data transmission packages, caller ID, music service packages and ring tone services and usage reporting services.
Unlimited, but decelerate to 5 Mbps after 110 GB LTE Basic ￦ 33,000 Unlimited 50 min. 1.4 GB with an option to transfer data from and into the next month’s usage In addition to our mobile service plans, we offer value-added services for additional monthly fees that can be added to the subscription such as media packages, mobile TV packages, additional data transmission packages, caller ID, music service packages and ring tone services and usage reporting services.
We pay a settlement fee to the relevant foreign carrier for such calls under a bilateral agreement with the foreign carrier. For incoming calls (including calls placed in Korea by customers of the foreign carriers for home country direct-dial services), we receive settlement payments from the relevant foreign carrier at the applicable settlement rate specified under the relevant bilateral agreement.
We pay a settlement fee to the relevant foreign carrier for such calls under a bilateral agreement with the foreign carrier. For incoming calls (including those placed in Korea by customers of the foreign carriers for home country direct-dial services), we receive settlement payments from the relevant foreign carrier at the applicable settlement rate specified under the relevant bilateral agreement.
The SCFBA and the regulations thereunder require an SCFB company to satisfy a minimum paid-in capital amount of (i) W 20 billion, where the SCFB company engages in no more than two kinds of core businesses and (ii) W 40 billion, where the SCFB company, such as BC Card, engages in three or more kinds of core businesses.
The SCFBA and the regulations thereunder require an SCFB company to satisfy a minimum paid-in capital amount of (i) ￦ 20 billion, where the SCFB company engages in no more than two kinds of core businesses and (ii) ￦ 40 billion, where the SCFB company, such as BC Card, engages in three or more kinds of core businesses.
Our member companies that issue co-branded credit or check cards include Woori Card, NH Card, Industrial Bank of Korea and KB Kookmin Card. We also compete with service providers that provide outsourcing services related to business operations of credit card companies.
Our member companies that issue co-branded credit or check cards include NH Card, Industrial Bank of Korea and KB Kookmin Card. We also compete with service providers that provide outsourcing services related to business operations of credit card companies.
Operating Results—Overview—Acquisitions and Disposals of Interests in Subsidiaries and Joint Ventures.” 25 Table of Contents IPTV We offer high definition video-on-demand and real-time broadcasting and ultra-high-definition (“UHD”) IPTV services under the brand name “Genie tv.” Our IPTV service offers access to an array of digital media contents, including broadcast channels, movies, sports, news, educational programs and TV replay, for a fixed monthly fee or on a pay-per-view basis.
Operating Results—Overview—Acquisitions and Disposals of Interests in Subsidiaries and Joint Ventures.” IPTV We offer high definition video-on-demand and real-time broadcasting and ultra-high-definition (“UHD”) IPTV services under the brand name “Genie tv.” Our IPTV service offers access to an array of digital media contents, including broadcast channels, movies, sports, news, educational programs and TV replay, for a fixed monthly fee or on a pay-per-view basis.
In recent years, the proliferation of mobile phones, as well as the availability of increasingly lower wireless pricing plans, some of which include unlimited voice minutes, has led to significant decreases in our domestic long-distance call minutes and local call pulses. 23 Table of Contents The following table shows selected information concerning our fixed-line telephone network and the number of PSTN and VoIP subscribers as of the end of the periods indicated as well as their engagement levels during such periods.
In recent years, the proliferation of mobile phones, as well as the availability of increasingly lower wireless pricing plans, some of which include unlimited voice minutes, has led to significant decreases in our domestic long-distance call minutes and local call pulses. 24 Table of Contents The following table shows selected information concerning our fixed-line telephone network and the number of PSTN and VoIP subscribers as of the end of the periods indicated as well as their engagement levels during such periods.
Subsequently, to facilitate expedient establishment of 5G mobile services infrastructure, the Government amended the co-use system as follows: (i) we should permit not only fixed-line telecommunications service providers, but also mobile service providers such as SK Telecom and LG U+ to co-use our telecommunications infrastructure necessary for provision of 5G mobile services, (ii) the Government determined that we, SK Telecom, SK Broadband and LG U+ possessed essential infrastructure with respect to the interval between the cable entry at a building and the initial occurrence of connection within the building and required that the three companies share such infrastructure throughout buildings in Korea with each other, and (iii) fixed-line telecommunications service providers and mobile service providers are required to participate in joint efforts to construct additional fixed-line and mobile network architecture.
Subsequently, to facilitate expedient establishment of 5G mobile services infrastructure, the Government amended the co-use system as follows: (i) we should permit not only fixed-line telecommunications service providers, but also mobile service providers such as SK Telecom and LG U+ to co-use our telecommunications infrastructure necessary for provision of 40 Table of Contents 5G mobile services, (ii) the Government determined that we, SK Telecom, SK Broadband and LG U+ possessed essential infrastructure with respect to the interval between the cable entry at a building and the initial occurrence of connection within the building and required that the three companies share such infrastructure throughout buildings in Korea with each other, and (iii) fixed-line telecommunications service providers and mobile service providers are required to participate in joint efforts to construct additional fixed-line and mobile network architecture.
As of December 31, 2023, our backbone network utilizes 64 Tbp Long-haul Reconfigurable Optical Add Drop Multiplexer (“ROADM”) technology for connecting cities. ROADM technology improves bandwidth efficiency by enabling data to be transmitted from multiple signals across one fiber strand in a cable and carrying each signal on a separate wavelength.
As of December 31, 2024, our backbone network utilizes 64 Tbp Long-haul Reconfigurable Optical Add Drop Multiplexer (“ROADM”) technology for connecting cities. ROADM technology improves bandwidth efficiency by enabling data to be transmitted from multiple signals across one fiber strand in a cable and carrying each signal on a separate wavelength.
Through a digital set-top box that we rent to our customers, our customers are able to browse the catalogue of digital media contents and view selected media streams on their television. A set-top box provides two-way communications on an IP network and decodes video streaming data. We had approximately 9.4 million IPTV subscribers as of December 31, 2023.
Through a digital set-top box that we rent to our customers, our customers are able to browse the catalogue of digital media contents and view selected media streams on their television. A set-top box provides two-way communications on an IP network and decodes video streaming data. We had approximately 9.4 million IPTV subscribers as of December 31, 2024.
Our transmission backbone network connecting major cities in Korea utilize Packet Optical Transport Network (“POTN”), and we access such network through multi-service provisioning platform (“MSPP”) architecture. Our extensive domestic long-distance network is supplemented by our fully digital domestic microwave network, which consisted of 52 relay sites as of December 31, 2023.
Our transmission backbone network connecting major cities in Korea utilize Packet Optical Transport Network (“POTN”), and we access such network through multi-service provisioning platform (“MSPP”) architecture. Our extensive domestic long-distance network is supplemented by our fully digital domestic microwave network, which consisted of 52 relay sites as of December 31, 2024.
After service is ceased, the overdue charges that are not collected by the collection agency are written off. Credit Card Business Through BC Card in which we held a 69.5% interest as of December 31, 2023, we offer various credit card processing and related financial services.
After service is ceased, the overdue charges that are not collected by the collection agency are written off. Credit Card Business Through BC Card in which we held a 69.5% interest as of December 31, 2024, we offer various credit card processing and related financial services.
Digital Music Services We operate Genie, our platform for music contents as well as subscription-based access to digital music streaming and downloading services, through our subsidiary Genie Music Corporation, in which KT Studio Genie Co., Ltd. (“KT Studio Genie”) held a 36.0% interest as of December 31, 2023.
Digital Music Services We operate Genie, our platform for music contents as well as subscription-based access to digital music streaming and downloading services, through our subsidiary Genie Music Corporation, in which KT Studio Genie Co., Ltd. (“KT Studio Genie”) held a 36.0% interest as of December 31, 2024.
Media Content Creation and Distribution Services We engage in media content creation and distribution services through KT Studio Genie, in which we held a 90.9% interest as of December 31, 2023. KT Studio Genie produces and sells a wide range of media contents, including multi-episode drama series, to traditional media channels and OTT services.
Media Content Creation and Distribution Services We engage in media content creation and distribution services through KT Studio Genie, in which we held a 90.9% interest as of December 31, 2024. KT Studio Genie produces and sells a wide range of media contents, including multi-episode drama series, to traditional media channels and OTT services.
In addition, if an SCFB company is registered as a foreign exchange business institution with the MOEF, such SCFB company is required to maintain (1) a foreign-currency liquidity ratio (foreign currency liquid assets due within three months divided by foreign-currency liabilities due within three months) of not less than 80%, (2) a ratio of foreign currency liquid assets due within seven days less foreign currency liabilities due within seven days, divided by total foreign-currency assets, of 42 Table of Contents not less than 0%, and (3) a ratio of foreign currency liquid assets due within a month less foreign currency liabilities due within a month, divided by total foreign-currency assets, of not less than negative 10%.
In addition, if an SCFB company is registered as a foreign exchange business institution with the MOEF, such SCFB company is required to maintain (1) a foreign-currency liquidity ratio (foreign currency liquid assets due within three months divided by foreign-currency liabilities due within three months) of not less than 80%, (2) a ratio of foreign currency liquid assets due within seven days less foreign currency liabilities due within seven days, divided by total foreign-currency assets, of not less than 0%, and (3) a ratio of foreign currency liquid assets due within a month less foreign currency liabilities due within a month, divided by total foreign-currency assets, of not less than negative 10%.
Web Comics and Novels Services StoryWiz, which was established in February 2020 and in which KT Studio Genie held a 100.0% interest as of December 31, 2023, specializes in producing and distributing web comics and web novels. StoryWiz operates a platform called Blice for web novels and web comics.
Web Comics and Novels Services StoryWiz, which was established in February 2020 and in which KT Studio Genie held a 100.0% interest as of December 31, 2024, specializes in producing and distributing web comics and web novels. StoryWiz operates a platform called Blice for web novels and web comics.
Slim ￦ 16,500 ￦ 13,200 220 (6) Bundled Rate Plans In order to provide our customers with additional value and further promote our marketing efforts to cross sell our various services, we provide our customers with various bundled rate plans that provide discounts for subscribing to a combination of our services, as well as family plans that provide discounts for multiple line subscriptions under one household.
Slim ￦ 16,500 ￦ 13,200 220 (6) Bundled Rate Plans In order to provide our customers with additional value and further promote our marketing efforts to cross sell our various services, we provide our customers with various bundled rate plans that provide discounts for subscribing to a combination of our services, as well as family plans that provide 35 Table of Contents discounts for multiple line subscriptions under one household.
We offer artificial intelligence-based “GiGA genie” service to our IPTV subscribers through a voice recognition speaker that also serves as the IPTV’s set-top box, which enables us to take advantage of big data analytics and enhance our product offerings as well as operate a more effective automated customer service center.
We offer AI-based “GiGA genie” service to our IPTV subscribers through a voice recognition speaker that also serves as the IPTV’s set-top box, which enables us to take advantage of big data analytics and enhance our product offerings as well as operate a more effective automated customer service center.
Our principal services include: • mobile voice and data telecommunications services based on 5G, 4G LTE and 3G W-CDMA technology; • fixed-line services, which include: Ø (i) fixed-line telephone services, including local, domestic long-distance and international long-distance services, (ii) Voice over Internet Protocol (“VoIP”) telephone services (i.e., provision of communication services over the Internet, and not over the fixed-line PSTN) and (iii) interconnection services to other telecommunications companies; Ø broadband Internet access services; and Ø data communication services, including fixed-line and satellite leased line services and dedicated broadband Internet connection service to corporate and other institutional customers; • media and content services, including IPTV, satellite TV, digital music services, e-commerce services, online advertising consulting services and web comics and novels services; • financial services, including credit card processing and other financial services offered primarily through BC Card; • other business activities, including information technology and network services and rental of real estate by KT Estate Inc.
Our principal services include: • mobile voice and data telecommunications services based on 5G, 4G LTE and 3G ￦ -CDMA technology; • fixed-line services, which include: Ø (i) fixed-line telephone services, including local, domestic long-distance and international long-distance services, (ii) Voice over Internet Protocol (“VoIP”) telephone services (i.e., provision of communication services over the Internet, and not over the fixed-line PSTN) and (iii) interconnection services to other telecommunications companies; Ø broadband Internet access services; and 21 Table of Contents Ø data communication services, including fixed-line and satellite leased line services and dedicated broadband Internet connection service to corporate and other institutional customers; • media and content services, including IPTV, satellite TV, media content creation and distribution services, digital music services, e-commerce services, online advertising consulting services and web comics and novels services; • financial services, including credit card processing and other financial services offered primarily through BC Card; • other business activities, including information technology and network services and rental of real estate by KT Estate Inc.
We also offer WiFi services under the “KT WiFi” brand name, which is designed to integrate fixed-line and wireless services by offering high speed wireless Internet access to laptops and smartphones in hot-spot zones and KT Internet service in fixed-line environments. Our broadband Internet access services accounted for 9.7% of our operating revenue in 2023.
We also offer WiFi services under the “KT WiFi” brand name, which is designed to integrate fixed-line and wireless services by offering high speed wireless Internet access to laptops and smartphones in hot-spot zones and KT Internet service in fixed-line environments. Our broadband Internet access services accounted for 9.9% of our operating revenue in 2024.
Research and Development, Patents and Licenses, Etc.” We license our intellectual property rights to third parties in return for periodic royal payments. We currently do not license any material technologies or patents from third parties. Seasonality of the Business Our main business generally does not experience significant seasonality. Item 4.C.
Research and Development, Patents and Licenses, Etc.” We license our intellectual property rights to third parties in return for periodic royal payments. We currently do not license any material technologies or patents from third parties. 44 Table of Contents Seasonality of the Business Our main business generally does not experience significant seasonality. Item 4.C.
Our fixed-line telephone network includes exchanges, long-distance transmission equipment and fiber optic and copper cables. We also provide VoIP telephone services that enable VoIP phone devices with broadband connection to make domestic and international calls. These fixed-line and VoIP telephone services accounted for 4.7% of our operating revenue in 2023.
Our fixed-line telephone network includes exchanges, long-distance transmission equipment and fiber optic and copper cables. We also provide VoIP telephone services that enable VoIP phone devices with broadband connection to make domestic and international calls. These fixed-line and VoIP telephone services accounted for 4.4% of our operating revenue in 2024.
Generally, when a telecommunications service provider intends to collect or use its customer’s personal information, such telecommunications service provider, with certain exceptions, must notify and receive the customers’ consent in relation to the purpose of collection, the use of the collected personal information, types of personal information collected and period during which the personal information will be possessed and used.
Generally, when a telecommunications service provider intends to collect or use its customer’s personal information, such telecommunications service provider, with certain exceptions, must notify and receive the customers’ consent in relation to 38 Table of Contents the purpose of collection, the use of the collected personal information, types of personal information collected and period during which the personal information will be possessed and used.
We also offer various video-on-demand contents for streaming and downloading for a fee. 34 Table of Contents The following table summarizes the terms of our representative IPTV service plans that we currently offer: Plan Monthly Rate Rate for 3 Year Term Channels (UHD) Additional Features Genie tv NETFLIX Choice UHD ￦ 42,300 ￦ 35,480 266 (6) • Genie tv Essence and NETFLIX premium service NETFLIX Choice HD ￦ 38,800 ￦ 29,680 266 (6) • Genie tv Essence and NETFLIX standard service SuperPack Choice ￦ 36,300 ￦ 29,480 266 (6) • Genie tv Essence and free movie, drama and animation contents VOD Choice ￦ 31,020 ￦ 24,816 266 (6) • Genie tv Essence and monthly coupon of ￦ 10,000 for video-on-demand Essence Plus ￦ 28,160 ￦ 22,484 266 (6) • Genie tv Essence and monthly coupon of ￦ 5,000 for video-on-demand Essence ￦ 25,300 ￦ 20,240 266 (6) Lite ￦ 19,800 ￦ 15,840 240 (3) Basic ￦ 18,150 ￦ 14,740 236 (3) Slim ￦ 16,500 ￦ 13,200 220 (3) Genie tv skylife Entertainment ￦ 31,020 ￦ 24,816 228 (6) • Monthly coupon of ￦ 10,000 for video-on-demand.
The following table summarizes the terms of our representative IPTV service plans that we currently offer: Plan Monthly Rate Rate for 3 Year Term Channels (UHD) Additional Features Genie tv NETFLIX Choice UHD ￦ 42,300 ￦ 35,480 266 (6) • Genie tv Essence and NETFLIX premium service NETFLIX Choice HD ￦ 38,800 ￦ 29,680 266 (6) • Genie tv Essence and NETFLIX standard service SuperPack Choice ￦ 36,300 ￦ 29,480 266 (6) • Genie tv Essence and free movie, drama and animation contents VOD Choice ￦ 31,020 ￦ 24,816 266 (6) • Genie tv Essence and monthly coupon of ￦ 10,000 for video-on-demand Essence Plus ￦ 28,160 ￦ 22,484 266 (6) • Genie tv Essence and monthly coupon of ￦ 5,000 for video-on-demand Essence ￦ 25,300 ￦ 20,240 266 (6) Lite ￦ 19,800 ￦ 15,840 240 (3) Basic ￦ 18,150 ￦ 14,740 236 (3) Slim ￦ 16,500 ￦ 13,200 220 (3) Genie tv skylife Entertainment ￦ 31,020 ￦ 24,816 228 (6) • Monthly coupon of ￦ 10,000 for video-on-demand.
The MSIT may also order us or the foreign shareholder to take corrective measures in respect of the excess shares within a period of up to six months. Customers and Customer Billing We typically charge residential subscribers and business subscribers similar rates for services provided.
The MSIT may also order us or the foreign shareholder to take corrective measures in respect of the excess shares within a period of up to six months. 42 Table of Contents Customers and Customer Billing We typically charge residential subscribers and business subscribers similar rates for services provided.
In addition to monthly rates for subscription, we charge a one-time installation fee of ￦ 27,500 per set-top box and a digital set-top box rental fee ranging from ￦ 7,700 to ￦ 22,000 per year that varies depending on the type of set-top box required for the service plan, which is also subject to discounts and waivers based on length of subscription commitment period.
In addition to monthly rates for subscription, we charge a one-time installation fee of ￦ 31,400 per set-top box and a digital set-top box rental fee ranging from ￦ 7,700 to ￦ 22,000 per year that varies depending on the type of set-top box required for the service plan, which is also subject to discounts and waivers based on length of subscription commitment period.
For households that subscribe to broadband Internet access as well as mobile services, our premium family plan provides discounts of approximately 50% for broadband Internet access subscription as well as for mobile services of each additional family member (up to four additional members). 35 Table of Contents Competition We face significant competition in each of our principal business areas.
For households that subscribe to broadband Internet access as well as mobile services, our premium family plan provides discounts of approximately 50% for broadband Internet access subscription as well as for mobile services of each additional family member (up to four additional members). Competition We face significant competition in each of our principal business areas.
In addition to merchant fees, we receive commissions related to nominal interchange fees for international card transactions, as well as service fees from financial institutions that outsource their credit card business operations. K Bank K Bank is one of three Internet-only banks in Korea.
In addition to merchant fees, we receive commissions related to nominal interchange fees for international card transactions, as well as service fees from financial institutions that outsource their credit card business operations. Kbank Kbank is one of three Internet-only banks in Korea.
We also offer bundled rate plans that provide discounts for subscribing to a 29 Table of Contents combination of our services, as well as family plans that provide discounts for multiple line subscriptions under one household. For many of our services, we provide additional discounts for customers who commit to extended subscription periods.
We also offer bundled rate plans that provide discounts for subscribing to a combination of our services, as well as family plans that provide discounts for multiple line subscriptions under one household. For many of our services, we provide additional discounts for customers who commit to extended subscription periods.
In the event that any 41 Table of Contents foreigner or foreign government acquires our shares in violation of the above provisions, the Telecommunications Business Act restricts such foreign shareholder from exercising his or her voting rights with respect to common shares exceeding such threshold.
In the event that any foreigner or foreign government acquires our shares in violation of the above provisions, the Telecommunications Business Act restricts such foreign shareholder from exercising his or her voting rights with respect to common shares exceeding such threshold.
As of December 31, 2023, the net book value of our investment properties, which is accounted for separately from our property and equipment, was ￦ 2,198 billion. Other than as may be described in this annual report, no significant amount of our properties is leased. There are no material encumbrances on our properties including the fixed assets below.
As of December 31, 2024, the net book value of our investment properties, which is accounted for separately from our property and equipment, was ￦ 2,300 billion. Other than as may be described in this annual report, no significant amount of our properties is leased. There are no material encumbrances on our properties including the fixed assets below.
With the launch of 5G mobile services in April 2019, competition has further intensified among the three network service providers, which has resulted in an increase in marketing expenses, as well as additional capital expenditures related to implementing 5G mobile services.
With the launch of 5G mobile services in April 2019, competition has further intensified among the three network service 36 Table of Contents providers, which has resulted in an increase in marketing expenses, as well as additional capital expenditures related to implementing 5G mobile services.
Organizational Structure These matters are discussed under Item 4.B. where relevant. Item 4.D. Property, Plant and Equipment Our principal fixed asset is our integrated telecommunications networks. In addition, we own buildings and real estate throughout Korea.
Organizational Structure These matters are discussed under Item 4.B. where relevant. Item 4.D. Property, Plant and Equipment Our principal fixed asset consists of our integrated telecommunications networks. In addition, we own buildings and real estate throughout Korea.
The following table shows such interconnection charge per minute collected for a call depending on the type of call, as determined by the MSIT: Effective Starting January 1, 2021 January 1, 2022 January 1, 2023 Local access (1) ￦ 7.0 ￦ 6.7 ￦ 6.3 Single toll access (2) 8.0 7.6 7.2 Double toll access (3) 10.9 10.4 10.1 Source: The MSIT.
The following table shows such interconnection charge per minute collected for a call depending on the type of call, as determined by the MSIT: Effective Starting January 1, 2022 January 1, 2023 January 1, 2024 Local access (1) ￦ 6.7 ￦ 6.3 ￦ 6.2 Single toll access (2) 7.6 7.2 6.9 Double toll access (3) 10.4 10.1 9.1 Source: The MSIT.
In October 2011, we acquired a controlling interest in BC Card, a leading credit card solutions provider in Korea in which we held a 69.5% interest as of December 31, 2023. As of such date, BC Card held a 33.7% interest in K Bank, an Internet-only bank that began its commercial operations in April 2017.
In October 2011, we acquired a controlling interest in BC Card, a leading credit card solutions provider in Korea in which we held a 69.5% interest as of December 31, 2024. As of such date, BC Card held a 33.7% interest in Kbank, an Internet-only bank that began its commercial operations in April 2017.
(1) Interconnection between local switching center and local access line. (2) Interconnection involving access to single long-distance switching center. (3) Interconnection involving access to two long-distance switching centers. 33 Table of Contents VoIP Telephone Services Our VoIP telephone services offer rate plans that charge generally lower base monthly rates and usage-based fees compared to our fixed-line telephone services.
(1) Interconnection between local switching center and local access line. (2) Interconnection involving access to single long-distance switching center. (3) Interconnection involving access to two long-distance switching centers. VoIP Telephone Services Our VoIP telephone services offer rate plans that charge generally lower base monthly rates and usage-based fees compared to our fixed-line telephone services.
Revenue from our financial services, which consist primarily of revenue from BC Card, accounted for 14.9% of our operating revenue in 2023. BC Card Through BC Card, we offer various credit card processing and related financial services. We operate the largest merchant payment network in Korea as measured by transaction volume.
Revenue from our financial services, which consist primarily of revenue from BC Card, accounted for 14.0% of our operating revenue in 2024. BC Card Through BC Card, we offer various credit card processing and related financial services. We operate the largest merchant payment network in Korea as measured by transaction volume.
Sale of goods accounted for 12.4% of our operating revenue in 2023. Our Rates We offer various service plans for our mobile, fixed-line and media and content services. For our individual customers, we offer rate plans targeting specific customer segments that aim to address their individual needs.
Sale of goods accounted for 12.6% of our operating revenue in 2024. Our Rates We offer various service plans for our mobile, fixed-line and media and content services. For our individual customers, we offer rate plans targeting specific customer segments that aim to address their individual needs.
The rates we charge for local calls are required to be reported to the MSIT, which has 15 days to object to such changes. For our subscribers who are initiating fixed-line telephone services, we charge a one-time nonrefundable activation fee of ￦ 27,500.
The rates we charge for local calls are required to be reported to the MSIT, which has 15 days to object to such changes. For our subscribers who are initiating fixed-line telephone services, we charge a one-time nonrefundable activation fee of ￦ 36,000.
In April 2022, we completed a vertical spin-off of our Internet data centers business and established a wholly-owned subsidiary, kt cloud Co., Ltd., (“kt cloud”) to more effectively promote the growth of our Internet data center and cloud operations. As of December 31, 2023, we held an 86.3% interest in kt cloud.
In April 2022, we 29 Table of Contents completed a vertical spin-off of our Internet data centers business and established a wholly-owned subsidiary, kt cloud Co., Ltd., (“kt cloud”) to more effectively promote the growth of our Internet data center and cloud operations. As of December 31, 2024, we held an 86.3% interest in kt cloud.
In addition, for a call initiated by our mobile subscriber to a mobile subscriber of one of our competitors, we collect from our subscriber our normal rate and remit to the competitor a mobile-to-mobile interconnection charge.
In addition, 32 Table of Contents for a call initiated by our mobile subscriber to a mobile subscriber of one of our competitors, we collect from our subscriber our normal rate and remit to the competitor a mobile-to-mobile interconnection charge.
We provide discount rates to qualified customers, including small- and medium-sized enterprises, businesses engaging in Internet access services and government agencies. Data communication services accounted for 4.9% of our operating revenue in 2023. Through our wholly owned subsidiary KT Sat Co., Ltd., we also provide transponder leasing, broadcasting, video distribution and data communication services through satellites periodically launched by us.
We provide discount rates to qualified customers, including small- and medium-sized enterprises, businesses engaging in Internet access services and government agencies. Data communication services accounted for 5.0% of our operating revenue in 2024. Through our wholly owned subsidiary KT Sat Co., Ltd., we also provide transponder leasing, broadcasting, video distribution and data communication services through satellites periodically launched by us.
As of December 31, 2023, 43.2% of our common shares were owned by foreign investors. In the event that a network service provider violates the shareholding restrictions, its foreign shareholders cannot exercise voting rights for their shares in excess of such limitation, and the MSIT may require corrective measures be taken to comply with the ownership restrictions.
As of December 31, 2024, 49.0% of our common shares were owned by foreign investors. In the event that a network service provider violates the shareholding restrictions, its foreign shareholders cannot exercise voting rights for their shares in excess of such limitation, and the MSIT may require corrective measures be taken to comply with the ownership restrictions.
Approximately 89.2% of our subscribers as of December 31, 2023 pay through the direct-debit service. Accounts of subscribers who fail to pay our invoice are transferred to a collection agency, which sends out a notice of payment.
Approximately 89.4% of our subscribers as of December 31, 2024 pay through the direct-debit service. Accounts of subscribers who fail to pay our invoice are transferred to a collection agency, which sends out a notice of payment.
For our subscribers who are initiating VoIP telephone services, we charge a one-time nonrefundable activation fee of ￦ 27,500, which may be waived if the subscriber opts for self-installation.
For our subscribers who are initiating VoIP telephone services, we charge a one-time nonrefundable activation fee of ￦ 36,000, which may be waived if the subscriber opts for self-installation.
In June 2017, a business support system, called KT One System (“KOS”), was implemented. KOS is our wired/wireless system integration program that unified wired/wireless workflows, structures and systems that had been separated previously. KOS has contributed to enhancing various aspects of our business processes and control systems.
In June 2017, we implemented KT One System (“KOS”), a wired/wireless system integration program that unified wired/wireless workflows, structures and systems that had been separated previously. KOS has contributed to enhancing various aspects of our business processes and control systems.
Satellite TV We offer satellite TV services with features similar to our IPTV services through KT Skylife. As of December 31, 2023, we had approximately 3.5 million subscribers for our satellite TV services, including Genie tv Skylife combination services.
Satellite TV We offer satellite TV services with features similar to our IPTV services through KT Skylife. As of December 31, 2024, we had approximately 3.4 million subscribers for our satellite TV services, including Genie tv Skylife combination services.
As of December 31, 2023, we leased 318,281 lines to domestic and international businesses. We provide dedicated and secure broadband Internet connection service to institutional customers under the “Kornet” brand name. We provide high-speed connection to our Internet backbone network, as well as rent to our customers and install necessary routers to ensure reliable Internet connection and enhanced security.
As of December 31, 2024, we leased 321,771 lines to domestic and international businesses. We provide dedicated and secure broadband Internet connection service to institutional customers under the “Kornet” brand name. We provide high-speed connection to our Internet backbone network, as well as rent to our customers and install necessary routers to ensure reliable Internet connection and enhanced security.
A majority of our patents registered in Korea and 43 Table of Contents overseas relate to our wireless and fixed-line telecommunications, media services and technologies related to IoT and artificial intelligence. In addition, we operate several research and development (“R&D”) laboratories to develop latest technology and additional platforms, as described in “Item 5.C.
A majority of our patents registered in Korea and overseas relate to our wireless and fixed-line telecommunications, media services and technologies related to IoT and AI. In addition, we operate several research and development (“R&D”) laboratories to develop latest technology and additional platforms, as described in “Item 5.C.
Mobile Packages For our mobile services, we offer family plans that provide monthly discounts of up to ￦ 11,000 per mobile phone subscription. Up to five members of a household may participate in our family plans.
Mobile Packages For our mobile services, we offer family plans that provide monthly discounts of up to ￦ 22,110 per mobile phone subscription. Up to five members of a household may participate in our family plans.
Since the establishment of its predecessor, the MSIP, the MSIT has assumed primary policy and regulatory responsibility for matters such as: (i) registration of network service providers and licensing of select services (the MSIT authorizes the licensing of IPTV service providers and, with the 37 Table of Contents consent of the KCC, authorizes the licensing of satellite broadcasting companies); (ii) regulation of mergers and acquisitions, as well as license suspension and termination of network service providers; (iii) providing oversight on foreign ownership ratios in network service providers; and (iv) reviewing telecommunication matters as they relate to the public interest and approving ancillary telecommunication business activities.
The MSIT has primary policy and regulatory responsibility for matters such as: (i) registration of network service providers and licensing of select services (the MSIT authorizes the licensing of IPTV service providers and, with the prior consent of the KCC, authorizes the licensing of satellite broadcasting companies); (ii) regulation of mergers and acquisitions, as well as license suspension and termination of network service providers; (iii) providing oversight on foreign ownership ratios in network service providers; and (iv) reviewing telecommunication matters as they relate to the public interest and approving ancillary telecommunication business activities.
IPTV Services Market Share (%) KT Corporation (1) SK Broadband LG U+ December 31, 2021 44.3 29.8 25.9 December 31, 2022 44.3 30.6 25.1 December 31, 2023 43.6 31.2 25.2 Source: Investor relations report of each company. (1) Includes market share of IPTV services offered by KT Skylife.
IPTV Services Market Share (%) KT Corporation (1) SK Broadband LG U+ December 31, 2022 44.3 30.6 25.1 December 31, 2023 43.6 31.2 25.2 December 31, 2024 43.3 31.2 25.5 Source: Investor relations report of each company. (1) Includes market share of IPTV services offered by KT Skylife.
The following table shows the number of minutes of international long-distance calls recorded by us and network service providers utilizing our international long-distance network in each specified category for each year in the three-year period ended December 31, 2023: Year Ended December 31, 2021 2022 2023 (In millions of billed minutes) Incoming international long-distance calls (1) 242.4 422.2 615.8 Outgoing international long-distance calls 44.4 36.1 31.5 Total 286.8 458.3 647.3 (1) Starting in 2021, includes incoming traffic of application-to-person correspondence.
The following table shows the number of minutes of international long-distance calls recorded by us and network service providers utilizing our international long-distance network in each specified category for each year in the three-year period ended December 31, 2024: Year Ended December 31, 2022 2023 2024 (In millions of billed minutes) Incoming international long-distance calls 422.2 615.8 518.3 Outgoing international long-distance calls 36.1 31.5 27.5 Total 458.3 647.3 545.8 (1) Includes incoming traffic of application-to-person correspondence.
We are also leveraging our big data analytics capabilities and artificial intelligence technology to further enhance our IPTV services.
We are also leveraging our big data analytics capabilities and AI technology to further enhance our IPTV services.
As of or for the Year Ended December 31, 2019 2020 2021 2022 2023 Total Korean population (thousands) (1) 51,850 51,829 51,639 51,439 51,325 PSTN and VoIP lines in service (thousands) 14,185 13,582 13,096 12,581 12,035 PSTN lines in service 11,052 10,449 9,905 9,376 8,820 Local lines in service 10,076 9,475 8,937 8,430 7,892 Group lines in service 976 973 968 946 928 VoIP lines in service 3,133 3,133 3,191 3,206 3,215 Fiber optic cable (kilometers) 847,497 867,051 896,076 917,114 937,146 Domestic long-distance call minutes (millions) (2) 744 620 500 395 321 Local call pulses (millions) (2) 804 638 554 463 363 (1) Based on the number of registered residents as published by the Ministry of the Interior and Safety of Korea.
As of or for the Year Ended December 31, 2020 2021 2022 2023 2024 Total Korean population (thousands) (1) 51,829 51,639 51,439 51,325 51,217 PSTN and VoIP lines in service (thousands) 13,582 13,096 12,581 12,035 11,475 PSTN lines in service 10,449 9,905 9,376 8,820 8,264 Local lines in service 9,475 8,937 8,430 7,892 7,347 Group lines in service 973 968 946 928 917 VoIP lines in service 3,133 3,191 3,206 3,215 3,211 Fiber optic cable (kilometers) 867,051 896,076 917,114 937,146 953,183 Domestic long-distance call minutes (millions) (2) 620 500 395 321 242 Local call pulses (millions) (2) 638 554 463 363 294 (1) Based on the number of registered residents as published by the Ministry of the Interior and Safety of Korea.
Unlimited, but decelerate to 1 Mbps after 14 GB 5G Slim 10 GB ￦ 50,000 Unlimited 300 min. Unlimited, but decelerate to 400 kbps after 10 GB 5G Slim 7 GB ￦ 45,000 Unlimited 300 min. Unlimited, but decelerate to 400 kbps after 7 GB 5G Slim 4 GB ￦ 37,000 Unlimited 300 min.
Unlimited, but decelerate to 1 Mbps after 21 GB 5G Slim 14 GB ￦ 55,000 Unlimited 300 min. Unlimited, but decelerate to 1 Mbps after 14 GB 5G Slim 10 GB ￦ 50,000 Unlimited 300 min. Unlimited, but decelerate to 400 kbps after 10 GB 5G Slim 7 GB ￦ 45,000 Unlimited 300 min.
Unlimited, but decelerate to 1 Mbps after 50 GB 5G Simple 30 GB ￦ 61,000 Unlimited 300 min. Unlimited, but decelerate to 1 Mbps after 30 GB 5G Slim 21 GB ￦ 58,000 Unlimited 300 min. Unlimited, but decelerate to 1 Mbps after 21 GB 5G Slim 14 GB ￦ 55,000 Unlimited 300 min.
Unlimited, but decelerate to 1 Mbps after 70 GB 5G Simple 50 GB ￦ 63,000 Unlimited 300 min. Unlimited, but decelerate to 1 Mbps after 50 GB 5G Simple 30 GB ￦ 61,000 Unlimited 300 min. Unlimited, but decelerate to 1 Mbps after 30 GB 5G Slim 21 GB ￦ 58,000 Unlimited 300 min.
Mobile Services We provide mobile services based on 5G, 4G LTE and 3G W-CDMA technology. We have made extensive efforts to continually develop advanced technologies as well as to provide a variety of new mobile services with enhanced speed, latency and connectivity. We commercially launched our next generation 5G mobile services in April 2019.
Mobile Services We provide mobile services based on 5G, 4G LTE and 3G W-CDMA technology. We have made extensive efforts to continually develop advanced technologies as well as to provide a variety of new mobile services with enhanced speed, latency and connectivity.
In addition, all of our lines connected to toll exchanges are compatible to IP platform. Internet Backbone Our Internet backbone network, called KORNET, has the capacity to handle aggregate traffic of our broadband Internet access subscribers, data centers and Internet exchange system at any given moment of up to 39.2 Tbps as of December 31, 2023.
In addition, all of our lines connected to toll exchanges are compatible with IP platforms. 45 Table of Contents Internet Backbone Our Internet backbone network, called KORNET, has the capacity to handle aggregate traffic of our broadband Internet access subscribers, data centers and Internet exchange system at any given moment of up to 39.4 Tbps as of December 31, 2024.
A minority interest in BC Card is owned by various financial institutions in Korea, many of which are member companies that enter into co-branding agreements with us and issue credit cards and check cards under the “BC Card” brand.
A minority interest in BC Card is owned by various financial institutions in Korea, many of which are member companies that enter into co-branding agreements with us and issue credit cards and check cards under the “BC Card” brand. Our member companies that issue co-branded credit or check cards include NH Card, Industrial Bank of Korea and KB Kookmin Card.
As of December 31, 2023, we had approximately 9.8 million broadband Internet subscribers, including approximately 6.7 million KT GiGA Internet service subscribers with enhanced data transmission speeds. We also sponsored approximately 98 thousand hot-spot zones nationwide for wireless connection as of December 31, 2023.
As of December 31, 2024, we had approximately 10.0 million broadband Internet subscribers, including approximately 6.9 million KT GiGA Internet service subscribers with enhanced data transmission speeds. We also sponsored approximately 89 thousand hot-spot zones nationwide for wireless connection as of December 31, 2024.
As of December 31, 2023, the net book value of our property and equipment was ￦ 14,872 billion, of which ￦ 3,843 billion is accounted for by the net book value of our land, buildings and structures.
As of December 31, 2024, the net book value of our property and equipment was ￦ 14,826 billion, of which ￦ 3,786 billion is accounted for by the net book value of our land, buildings and structures.
In addition, as of December 31, 2023, our international telecommunications networks were directly linked to 263 telecommunications service 45 Table of Contents providers in various international destinations and are routed through our three international switching centers in Seoul, Daejeon and Busan.
In addition, as of December 31, 2024, our international telecommunications networks were directly linked to 203 telecommunications service providers in various international destinations and are routed through our three international switching centers in Seoul, Daejeon and Busan.
Telecommunications service providers designated as “universal service providers” by the MSIT are required to provide universal telecommunications services such as local services, local public telephone services, broadband services, discount services for persons with disabilities and for certain 39 Table of Contents low-income persons, telecommunications services for remote islands and wireless communication services for ships.
Telecommunications service providers designated as “universal service providers” by the MSIT are required to provide universal telecommunications services such as local services, local public telephone services, broadband services, discount services for persons with disabilities and for certain low-income persons, telecommunications services for remote islands and wireless communication services for ships. We have been designated as a universal service provider.
We offer Genie services in various formats that are specifically designed for mobile and other connected devices, PCs, TVs and automobiles. Genie Music Corporation also provides online streaming of live music performances through STAYG platform. E-commerce Services In July 2021, we merged KTH Co., Ltd. (“KTH”) and KT mhows Co., Ltd. (“KT mhows”) to create KT alpha Co., Ltd.
We offer Genie services in various formats that are specifically designed for mobile and other connected devices, PCs, TVs and automobiles. Genie Music Corporation also provides online streaming of live music performances through STAYG platform. E-commerce Services Through KT alpha Co., Ltd.
We also provide outsourcing services to a wide range of financial institutions for their credit card and check card business operations, including production and delivery of new credit cards, the preparation of monthly statements, management of merchants and other ancillary services. We also offer our services in select countries in Asia, including China, Indonesia and Vietnam.
We also provide outsourcing services to a wide range of financial institutions for their credit card and check card business operations, including production and delivery of new credit cards, the preparation of monthly statements, management of merchants and other ancillary services.
The following table shows the interconnection charges we paid per minute (exclusive of VAT) to our competitors, and the charges received per minute (exclusive of VAT) from mobile operators for mobile to mobile calls: Effective Starting January 1, 2021 January 1, 2022 January 1, 2023 KT ￦ 10.3 ￦ 9.7 ￦ 9.2 SK Telecom 10.3 9.7 9.2 LG U+ 10.3 9.7 9.2 Fixed-line Services Fixed-line Telephone Services Local and Domestic Long-distance .
The following table shows the interconnection charges we paid per minute (exclusive of VAT) to our competitors, and the charges received per minute (exclusive of VAT) from mobile operators for mobile to mobile calls: Effective Starting January 1, 2022 January 1, 2023 January 1, 2024 ￦ 9.7 ￦ 9.2 ￦ 8.6 Fixed-line Services Fixed-line Telephone Services Local and Domestic Long-distance .
Mobile Services We offer a wide range of mobile service plans that vary depending, among others, on mobile technology (5G, LTE or W-CDMA), mobile device (mobile phone, tablet or other WiFi device) and age category, under which we offer plans based on usage volume for voice calling, data transmission and text messaging as well as addition of value-added services.
Our rates for business customers are tailored to the specific needs of the business customers. 30 Table of Contents Mobile Services We offer a wide range of mobile service plans that vary depending, among others, on mobile technology (5G, LTE or W-CDMA), mobile device (mobile phone, tablet or other WiFi device) and age category, under which we offer plans based on usage volume for voice calling, data transmission and text messaging as well as addition of value-added services.
For the Year Ended December 31, 2021 2022 2023 Products and services Billions of Won % Billions of Won % Billions of Won % Mobile services ￦ 6,936 27.5 % ￦ 7,014 26.7 % ￦ 7,140 26.8 % Fixed-line services: Fixed-line and VoIP telephone services 1,465 5.8 1,378 5.3 1,249 4.7 Broadband Internet access services 2,344 9.3 2,505 9.5 2,579 9.7 Data communication services 1,152 4.6 1,173 4.5 1,315 4.9 Subtotal 4,960 19.7 5,057 19.3 5,142 19.3 Media and content services 2,801 11.1 3,100 11.8 3,207 12.1 Financial services 3,662 14.5 3,837 14.6 3,968 14.9 Others 3,313 13.1 3,834 14.6 3,846 14.5 Sale of goods (1) 3,533 14.0 3,394 12.9 3,293 12.4 Total operating revenue ￦ 25,206 100.0 % ￦ 26,234 100.0 % ￦ 26,595 100.0 % (1) Primarily related to sale of handsets for our mobile service and miscellaneous telecommunications equipment, as well as sale of residential units and commercial real estate developed by KT Estate.
For the Year Ended December 31, 2022 2023 2024 Products and services Billions of Won % Billions of Won % Billions of Won % Mobile services ￦ 7,014 26.7 % ￦ 7,140 26.8 % ￦ 7,318 27.4 % Fixed-line services: Fixed-line and VoIP telephone services 1,378 5.3 1,249 4.7 1,188 4.4 Broadband Internet access services 2,505 9.5 2,579 9.7 2,634 9.9 Data communication services 1,173 4.5 1,315 4.9 1,335 5.0 Subtotal 5,057 19.3 5,142 19.3 5,158 19.3 Media and content services 3,100 11.8 3,207 12.1 3,107 11.6 Financial services 3,837 14.6 3,968 14.9 3,743 14.0 Others 3,834 14.6 3,846 14.5 4,025 15.1 Sale of goods (1) 3,394 12.9 3,293 12.4 3,374 12.6 Total operating revenue ￦ 26,234 100.0 % ￦ 26,595 100.0 % ￦ 26,724 100.0 % (1) Primarily related to sale of handsets for our mobile service and miscellaneous telecommunications equipment, as well as sale of residential units and commercial real estate developed by KT Estate.
Our IP premium network enables us to more reliably support IPTV, VoIP and other IP-related services. As of December 31, 2023, our IP premium network had capacity of 4.4 Tbps to support LTE data, IPTV, voice and virtual private network (“VPN”) service traffic. In addition, our 5G backbone network had capacity of 5.0 Tbps to support 5G data service traffic.
Our IP premium network enables us to more reliably support our IPTV, VoIP and other IP-related services. As of December 31, 2024, our IP premium network had capacity of 4.7 Tbps to support LTE data, IPTV, voice and virtual private network (“VPN”) service traffic.
We compete with SK Telecom, a mobile service provider that has a longer operating history than us, and LG U+ which began its service at around the same time as KTF. As of December 31, 2023, we had approximately 24.9 million subscribers, or a market share of 29.7%.
We compete with SK Telecom, a mobile service provider that has a longer operating history than us, and LG U+ which began its service at around the same time as KTF. As of December 31, 2024, we had approximately 13.4 million MNO mobile subscribers, or a market share of 28.2%.
Broadband Internet Access Services Leveraging our nationwide network of 937,147 kilometers of fiber optic cables as of December 31, 2023, we have achieved a leading market position in the broadband Internet access 24 Table of Contents market in Korea.
Broadband Internet Access Services Leveraging our nationwide network of 953,183 kilometers of fiber optic cables as of December 31, 2024, we have achieved a leading market position in the broadband Internet access 25 Table of Contents market in Korea.
As of December 31, 2023, our international Internet backbone with capacity of approximately 8,340 Gbps is connected to approximately 320 Internet service and content providers through our two Internet gateways in Busan. In addition, we operate a broadcasting backbone with capacity of 0.86 Gbps to transmit broadcasting signals from Korea to the rest of the world.
As of December 31, 2024, our international Internet backbone with capacity of approximately 9,680 Gbps is connected to approximately 320 Internet service and content providers through our two Internet gateways in Busan. In addition, we operate a broadcasting backbone with capacity of 0.69 Gbps to transmit broadcasting signals from Korea to the rest of the world. 46 Table of Contents
Foreigners (based on citizenship), foreign governments and “companies deemed as foreigners” may not in the aggregate own more than 49.0% of the issued shares with voting rights of a network service provider, including us.
Foreign Investment The Telecommunications Business Act restricts the ownership and control of network service providers by foreign shareholders. Foreigners (based on citizenship), foreign governments and “companies deemed as foreigners” may not in the aggregate own more than 49.0% of the issued shares with voting rights of a network service provider, including us.
Internet Essence ￦ 55,000 ￦ 38,500 1.0 Gbps 150 GB Internet Slim ￦ 39,600 ￦ 22,000 100 Mbps None (1) Data transmission speed is reduced to 100 Mbps if data usage exceeds the specified maximum speed daily limit.
Internet Premium ￦ 60,500 ￦ 44,000 2.5 Gbps 250 GB Discount on 1 WiFi router rental. Internet Essence ￦ 55,000 ￦ 38,500 1.0 Gbps 150 GB Internet Slim ￦ 39,600 ￦ 22,000 100 Mbps None (1) Data transmission speed is reduced to 100 Mbps if data usage exceeds the specified maximum speed daily limit.
We also offer a wide range of “KT DX platform” services for our corporate and other institutional customers that provide customized and integrated digital transformation services that address their technical infrastructure, platform and solution needs. 28 Table of Contents In September 2021, KT ES Pte.
We also offer a wide range of “KT AX platform” services for our corporate and other institutional customers that provide customized and integrated digital transformation services that address their technical infrastructure, platform and solution needs.
Furthermore, pursuant to an amendment to the Telecommunications Business Act that became effective in December 2022, this exemption from the restriction of foreign ownership of a network service provider beyond the 49.0% threshold applies not only to a foreign government or a foreigner from an FTA Country but also to a foreign government or a foreigner from an OECD country.
Furthermore, this exemption from the restriction of foreign ownership of a network service provider beyond the 49.0% threshold applies not only to a foreign government or a foreigner from an FTA Country but also to a foreign government or a foreigner from an OECD country.
Media and content services accounted for 12.1% of our operating revenue in 2023. In addition, in September 2021, KT Skylife, in which we held a 50.3% interest as of December 31, 2023, acquired a 100.00% interest in HCN, which is Korea’s fifth largest cable TV operator. See “Item 5. Operating and Financial Review and Prospects—Item 5.A.
In addition, in September 2021, KT Skylife, in which we held a 50.3% interest as of December 31, 2024, acquired a 100.00% interest in KT HCN, which is Korea’s fifth largest cable TV operator. See “Item 5. 26 Table of Contents Operating and Financial Review and Prospects—Item 5.A.
Unlimited • Unlimited data roaming at 100 kbps • Free contents (subscribers can choose two services among Movie / Music / Netflix / Disney / YouTube / Tving) 5G Basic ￦ 80,000 Unlimited 300 min. Unlimited • Unlimited data roaming at 100 kbps 5G Simple 110 GB ￦ 69,000 Unlimited 300 min.
Unlimited • Unlimited data roaming at 100 kbps • Free benefits (subscribers can choose one benefit among Tving / Netflix / YouTube Premium / Disney / Samsung) 5G Basic ￦ 80,000 Unlimited 300 min. Unlimited • Unlimited data roaming at 100 kbps 5G Simple 110 GB ￦ 69,000 Unlimited 300 min.
As of such date, our market share of the fixed-line local telephone and VoIP services was 62.3%; and 21 Table of Contents • we are Korea’s largest broadband Internet access provider with approximately 9.8 million subscribers as of December 31, 2023, representing a market share of 40.8%.
As of such date, our market share of the fixed-line local telephone and VoIP services was 53.7%; and • we are Korea’s largest broadband Internet access provider with approximately 10.0 million subscribers as of December 31, 2024, representing a market share of 39.8%.
Under the Framework Act on Telecommunications and the Telecommunications Business Act, the MSIT continues to have comprehensive regulatory authority over the telecommunications industry and all network service providers.
Regulation Under the Framework Act on Telecommunications, the Telecommunications Business Act, the Broadcasting Act and the Radio Waves Act, the MSIT has comprehensive regulatory authority over the telecommunications industry and all network service providers.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Ltd. in 2023 and (ii) impairment of goodwill of ￦ 98 billion related to HCN in 2023. • Utilities increased by 47.9%, or ￦ 176 billion, from ￦ 368 billion in 2022 to ￦ 545 billion in 2023 primarily due to increases in unit prices of electricity and our usage volume thereof. • Depreciation expenses increased by 3.3%, or ￦ 86 billion, from ￦ 2,637 billion in 2022 to ￦ 2,724 billion in 2023 primarily reflecting increase in depreciable assets.
Ltd. in 2023 and (ii) impairment of goodwill of ￦ 98 billion related to KT HCN in 2023. • Utilities increased by 47.9%, or ￦ 176 billion, from ￦ 368 billion in 2022 to ￦ 545 billion in 2023 primarily due to increases in unit prices of electricity and our usage volume thereof. • Depreciation expenses increased by 3.3%, or ￦ 86 billion, from ￦ 2,637 billion in 2022 to ￦ 2,724 billion in 2023 primarily reflecting increase in depreciable assets.
Our net loss on foreign currency translation decreased by 46.6%, or ￦ 84 billion, from ￦ 157 billion in 2022 to ￦ 84 billion in 2023, as the Won depreciated against the U.S. dollar at year-end 2022 and further depreciated (to a lesser extent) at year-end 2023.
Our net loss on foreign currency translation decreased by 46.6%, or ￦ 73 billion, from ￦ 157 billion in 2022 to ￦ 84 billion in 2023, as the Won depreciated against the U.S. dollar at year-end 2022 and further depreciated (to a lesser extent) at year-end 2023.
Specifically: • Other expenses increased by 38.9%, or ￦ 533 billion, from ￦ 1,370 billion in 2022 to ￦ 1,902 billion in 2023 primarily due to increases in interest costs and credit losses of BC 54 Table of Contents Card, which were adversely impacted by increases in interest rates throughout 2022 that remained relatively high in 2023. • Impairment loss on intangible assets increased by 662.8%, or ￦ 205 billion, from ￦ 31 billion in 2022 to ￦ 236 billion in 2023 primarily due to (i) impairment of goodwill of ￦ 119 billion related to Epsilon Global Communications Pte.
Specifically: • Other expenses increased by 38.9%, or ￦ 533 billion, from ￦ 1,370 billion in 2022 to ￦ 1,902 billion in 2023 primarily due to increases in interest costs and credit losses of BC Card, which were adversely impacted by increases in interest rates throughout 2022 that remained relatively high in 2023. 63 Table of Contents • Impairment loss on intangible assets increased by 662.8%, or ￦ 205 billion, from ￦ 31 billion in 2022 to ￦ 236 billion in 2023 primarily due to (i) impairment of goodwill of ￦ 119 billion related to Epsilon Global Communications Pte.
Financial Services Financial services revenue increased by 3.4%, or ￦ 131 billion, from ￦ 3,837 billion in 2022 to ￦ 3,968 billion in 2023 primarily due to an increase in fees from credit card services of BC Card. 53 Table of Contents Others Other operating revenue increased by 0.3%, or ￦ 12 billion, from ￦ 3,834 billion in 2022 to ￦ 3,846 billion in 2023 primarily due to increases in revenue from our information technology and network services, particularly from the operation of Internet data centers and systems integration services.
Financial Services Financial services revenue increased by 3.4%, or ￦ 131 billion, from ￦ 3,837 billion in 2022 to ￦ 3,968 billion in 2023 primarily due to an increase in fees from credit card services of BC Card. 62 Table of Contents Others Other operating revenue increased by 0.3%, or ￦ 12 billion, from ￦ 3,834 billion in 2022 to ￦ 3,846 billion in 2023 primarily due to increases in revenue from our information technology and network services, particularly from the operation of Internet data centers and systems integration services.
These developments include: • acquisition of new bandwidth licenses and usage fees; • researching and implementing technology upgrades and additional telecommunications services; • changes in the rate structure for our telecommunications services; • acquisitions and disposals of interests in subsidiaries and joint ventures; and • marketing activities.
These developments include: • acquisition of new bandwidth licenses and usage fees; • researching and implementing technology upgrades and additional telecommunications services; • changes in the rate structure for our telecommunications services; and • acquisitions and disposals of interests in subsidiaries and joint ventures.
For example, in September 2021, KT Skylife, in which we held a 50.3% interest as of December 31, 2023, completed its acquisition of a 100.00% interest in HCN, which is Korea’s fifth largest cable operator.
For example, in September 2021, KT Skylife, in which we held a 50.3% interest as of December 31, 2024, completed its acquisition of a 100.00% interest in KT HCN, which is Korea’s fifth largest cable operator.
Operating margin for this segment decreased from 5.9% in 2022 to 1.2% in 2023. Depreciation and amortization for this segment, prior to adjusting for inter-segment transactions, increased by 1.7%, or ￦ 10 billion, from ￦ 575 billion in 2022 to ￦ 585 billion in 2023.
Operating margin for this segment decreased from 5.9% in 2022 to 1.2% in 2023. Depreciation and amortization for this segment, prior to adjusting for inter-segment transactions, increased by 1.7%, or ￦ 10 billion, from ￦ 575 billion in 2022 to ￦ 585 billion in 2023. Item 5.B.
Operating Expenses The following table presents a breakdown of our operating expenses and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Salaries and wages ￦ 4,496 ￦ 4,549 ￦ 54 1.2 % Depreciation 2,637 2,724 86 3.3 Depreciation of right-of-use assets 396 403 7 1.6 Amortization of intangible assets 622 684 62 9.9 Commissions 1,295 1,265 (31 ) (2.4 ) Interconnection charges 480 437 (43 ) (8.9 ) International interconnection fee 186 140 (46 ) (24.6 ) Purchase of inventories 3,656 3,595 (61 ) (1.7 ) Changes of inventories (195 ) (203 ) (8 ) 4.1 Sales commissions 2,354 2,353 (1 ) (0.0 ) Service costs 2,334 2,237 (97 ) (4.2 ) Utilities 368 545 176 47.9 Taxes and dues 277 251 (26 ) (9.5 ) Rent 161 168 7 4.2 Insurance premium 68 67 (2 ) (2.2 ) Installation fees 150 174 24 16.1 Advertising expenses 196 154 (42 ) (21.4 ) Allowance for bad debts 115 151 35 30.5 Card service costs 3,128 3,189 62 2.0 Loss on disposal of property and equipment 81 73 (9 ) (10.7 ) Loss on disposal of intangible assets 7 5 (2 ) (24.0 ) Loss on disposal of right-of-use assets 2 2 (0 ) (9.9 ) Impairment loss on property and equipment 16 8 (8 ) (51.1 ) Impairment loss on intangible assets 31 236 205 662.8 Donations 16 25 9 57.7 Other allowance for bad debts 18 34 17 94.4 Others 1,370 1,902 533 38.9 Total operating expenses ￦ 24,266 ￦ 25,167 901 3.7 Total operating expenses increased by 3.7%, or ￦ 901 billion, from ￦ 24,266 billion in 2022 to ￦ 25,167 billion in 2023 primarily due to increases in other expenses, impairment loss on intangible assets, utilities and depreciation expenses, which impact was partially offset by decreases in service costs and purchase of inventories.
Operating Expenses The following table presents a breakdown of our operating expenses and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Employee benefit costs ￦ 4,496 ￦ 4,557 ￦ 61 1.4 % Depreciation 2,637 2,724 86 3.3 Depreciation of right-of-use assets 396 403 7 1.6 Amortization of intangible assets 622 684 62 9.9 Commissions 1,295 1,265 (31 ) (2.4 ) Interconnection charges 480 437 (43 ) (8.9 ) International interconnection fee 186 140 (46 ) (24.6 ) Purchase of inventories 3,656 3,595 (61 ) (1.7 ) Changes of inventories (195 ) (203 ) (8 ) 4.1 Sales commissions 2,354 2,353 (1 ) (0.0 ) Service costs 2,334 2,230 (104 ) (4.5 ) Utilities 368 545 176 47.9 Taxes and dues 277 251 (26 ) (9.5 ) Rent 161 168 7 4.2 Insurance premium 68 67 (2 ) (2.2 ) Installation fees 150 174 24 16.1 Advertising expenses 196 154 (42 ) (21.4 ) Allowance for bad debts 115 151 35 30.5 Card service costs 3,128 3,189 62 2.0 Loss on disposal of property and equipment 81 73 (9 ) (10.7 ) Loss on disposal of intangible assets 7 5 (2 ) (24.0 ) Loss on disposal of right-of-use assets 2 2 (0 ) (9.9 ) Impairment loss on property and equipment 16 8 (8 ) (51.1 ) Impairment loss on intangible assets 31 236 205 662.8 Donations 16 25 9 57.7 Other allowance for bad debts 18 34 17 94.4 Others 1,370 1,902 533 38.9 Total operating expenses ￦ 24,266 ￦ 25,167 901 3.7 Total operating expenses increased by 3.7%, or ￦ 901 billion, from ￦ 24,266 billion in 2022 to ￦ 25,167 billion in 2023 primarily due to increases in other expenses, impairment loss on intangible assets, utilities and depreciation expenses, which impact was partially offset by decreases in service costs and purchase of inventories.
We believe that we have sufficient working capital available to us for our current requirements and that we have a variety of alternatives available to us to satisfy our financial requirements to the 61 Table of Contents extent that they are not met by funds generated by operations, including the issuance of debt securities and bank borrowings denominated in Won and various foreign currencies.
We believe that we have sufficient working capital available to us for our current requirements and that we have a variety of alternatives available to us to satisfy our financial requirements to the extent that they are not met by funds generated by operations, including the issuance of debt securities and bank borrowings denominated in Won and various foreign currencies.
Operating Results.” Non-cash expense adjustments in our statement of cash flows from depreciation, amortization of intangible assets and depreciation of right-of-use assets amounted to ￦ 3,647 billion in 2021, ￦ 3,711 billion in 2022 and ￦ 3,868 billion in 2023, primarily reflecting our capital investment activities during the recent years, including our payments on bandwidth licenses for our operations, investments in network infrastructures and acquisition of real estate.
Operating Results.” Non-cash expense adjustments in our statement of cash flows from depreciation, amortization of intangible assets and depreciation of right-of-use assets amounted to ￦ 3,711 billion in 2022, ￦ 3,868 billion in 2023 and ￦ 3,930 billion in 2024, primarily reflecting our capital investment activities during the recent years, including our payments on bandwidth licenses for our operations, investments in network infrastructures and acquisition of real estate.
Business Overview—Our Rates.” Acquisitions and Disposals of Interests in Subsidiaries and Joint Ventures One key aspect of our overall business strategy calls for acquisitions of businesses and entering into joint ventures that complement or diversify our current business, as well as disposal or 48 Table of Contents termination of such businesses from time to time.
Business Overview—Our Rates.” Acquisitions and Disposals of Interests in Subsidiaries and Joint Ventures One key aspect of our overall business strategy calls for acquisitions of businesses and entering into joint ventures that complement or diversify our current business, as well as disposal or termination of such businesses from time to time.
Operating Results—2022 Compared to 2023 The following table presents selected income statement data and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Operating revenue ￦ 26,234 ￦ 26,595 ￦ 361 1.4 % Operating expenses 24,266 25,167 901 3.7 Operating profit 1,968 1,428 (540 ) (27.4 ) Finance income 690 486 (204 ) (29.6 ) Finance costs 750 569 (181 ) (24.2 ) Share of net profits of associates and joint ventures (17 ) (43 ) (26 ) 151.2 Profit before income tax 1,891 1,303 (589 ) (31.1 ) Income tax expense 506 330 (175 ) (34.7 ) Profit for the year ￦ 1,386 ￦ 972 (413) (29.8 ) Operating Revenue The following table presents a breakdown of our operating revenue and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 Products and services 2022 2023 Amount % (In billions of Won) Mobile services ￦ 7,014 ￦ 7,140 ￦ 126 1.8 % Fixed-line services: Fixed-line and VoIP telephone services 1,378 1,249 (129 ) (9.4 ) Broadband Internet access services 2,505 2,579 74 2.9 Data communication services 1,173 1,315 141 12.0 Subtotal 5,057 5,142 86 1.7 Media and content services 3,100 3,207 107 3.4 Financial services 3,837 3,968 131 3.4 Others 3,834 3,846 12 0.3 Sale of goods (1) 3,394 3,293 (101 ) (3.0 ) Total operating revenue ￦ 26,234 ￦ 26,595 361 1.4 (1) Primarily related to sale of handsets for our mobile service and miscellaneous telecommunications equipment, as well as sale of residential units and commercial real estate developed by KT Estate.
Operating Results—2023 Compared to 2022 The following table presents selected income statement data and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Operating revenue ￦ 26,234 ￦ 26,595 ￦ 361 1.4 % Operating expenses 24,266 25,167 901 3.7 Operating profit 1,968 1,428 (540 ) (27.4 ) Finance income 690 486 (204 ) (29.6 ) Finance costs 750 569 (181 ) (24.2 ) Share of net profits of associates and joint ventures (17 ) (43 ) (26 ) 151.2 Profit before income tax 1,891 1,303 (589 ) (31.1 ) Income tax expense 506 330 (175 ) (34.7 ) Profit for the year ￦ 1,386 ￦ 972 (413 ) (29.8 ) Operating Revenue The following table presents a breakdown of our operating revenue and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 Products and services 2022 2023 Amount % (In billions of Won) Mobile services ￦ 7,014 ￦ 7,140 ￦ 126 1.8 % Fixed-line services: Fixed-line and VoIP telephone services 1,378 1,249 (129 ) (9.4 ) Broadband Internet access services 2,505 2,579 74 2.9 Data communication services 1,173 1,315 141 12.0 Subtotal 5,057 5,142 86 1.7 Media and content services 3,100 3,207 107 3.4 Financial services 3,837 3,968 131 3.4 Others 3,834 3,846 12 0.3 Sale of goods (1) 3,394 3,293 (101 ) (3.0 ) Total operating revenue ￦ 26,234 ￦ 26,595 361 1.4 (1) Primarily related to sale of handsets for our mobile service and miscellaneous telecommunications equipment, as well as sale of residential units and commercial real estate developed by KT Estate. 61 Table of Contents Total operating revenue increased by 1.4%, or ￦ 361 billion, from ￦ 26,234 billion in 2022 to ￦ 26,595 billion in 2023 primarily due to increases in revenue from data communication services, financial services, mobile services, media and content services and broadband Internet access services, which impact was partially offset by decreases in revenue from fixed-line and VoIP telephone services and sale of goods.
The satellite TV segment recognized operating income, prior to adjusting for inter-segment transactions, of ￦ 20 billion in 2022 compared to operating loss, prior to adjusting for inter-segment 58 Table of Contents transactions, of ￦ 70 billion in 2023, as the ￦ 95 billion increase in the segment’s operating expenses outpaced the ￦ 5 billion increase in operating revenue.
The satellite TV segment recognized operating income, prior to adjusting for inter-segment transactions, of ￦ 20 billion in 2022 compared to operating loss, prior to adjusting for inter-segment transactions, of ￦ 70 billion in 2023, as the ￦ 95 billion increase in the segment’s operating expenses outpaced the ￦ 5 billion increase in operating revenue.
We also strive to prudently manage our borrowing level and mitigate our refinancing risks through various methods, including diversification of currency denominations and borrowing lines. Our debt-to-equity ratio, which is calculated by dividing total liabilities by total equity, was 124% as of December 31, 2021, 123% as of December 31, 2022 and 131% as of December 31, 2023.
We also strive to prudently manage our borrowing level and mitigate our refinancing risks through various methods, including diversification of currency denominations and borrowing lines. Our debt-to-equity ratio, which is calculated by dividing total liabilities by total equity, was 123% as of December 31, 2022, 131% as of December 31, 2023 and 134% as of December 31, 2024.
These factors were partially offset by the following: • Service costs decreased by 4.2%, or ￦ 97 billion, from ￦ 2,334 billion in 2022 to ￦ 2,237 billion in 2023 primarily due to decreases in corporate messaging volume and interconnection fees. • Purchase of inventories decreased by 1.7%, or ￦ 61 billion, from ￦ 3,656 billion in 2022 to ￦ 3,595 billion in 2023 primarily due to a decrease in purchase of mobile handsets used in connection with subscription of our mobile services.
These factors were partially offset by the following: • Service costs decreased by 4.5%, or ￦ 104 billion, from ￦ 2,334 billion in 2022 to ￦ 2,230 billion in 2023 primarily due to decreases in corporate messaging volume and interconnection fees. • Purchase of inventories decreased by 1.7%, or ￦ 61 billion, from ￦ 3,656 billion in 2022 to ￦ 3,595 billion in 2023 primarily due to a decrease in purchase of mobile handsets used in connection with subscription of our mobile services.
Including such contributions, total expenditures (which include capitalized expenses) on research and development were ￦ 214 billion in 2021, ￦ 231 billion in 2022 and ￦ 225 billion in 2023. We plan to continue to invest in researching and implementing network upgrades, which will entail additional operating expenses as well as capital expenditures.
Including such contributions, total expenditures (which include capitalized expenses) on research and development were ￦ 231 billion in 2022, ￦ 225 billion in 2023 and ￦ 212 billion in 2024. We plan to continue to invest in researching and implementing network upgrades, which will entail additional operating expenses as well as capital expenditures.
We anticipate that capital expenditures and repayment of outstanding contractual obligations and commitments (including for bandwidth licenses) will represent the most significant use of funds for 60 Table of Contents the next several years.
We anticipate that capital expenditures and repayment of outstanding contractual obligations and commitments (including for bandwidth licenses) will represent the most significant use of funds for the next several years.
The operating income for our finance segment, prior to adjusting for inter-segment transactions, decreased by 23.5%, or ￦ 28 billion, from ￦ 120 billion in 2022 to ￦ 92 billion in 2023, as the ￦ 136 billion increase in the segment’s operating expenses outpaced the ￦ 108 billion increase in operating revenue.
The operating income for our finance segment, prior to adjusting for inter-segment transactions, decreased by 23.5%, or ￦ 28 billion, from ￦ 120 billion in 2022 to ￦ 92 billion in 2023, as 66 Table of Contents the ￦ 136 billion increase in the segment’s operating expenses outpaced the ￦ 108 billion increase in operating revenue.
We expect that these sources will continue to be our principal sources of cash in the future. We recorded profits for the year of ￦ 1,459 billion in 2021, ￦ 1,386 billion in 2022 and ￦ 972 billion in 2023 as discussed in “Item 5.A.
We expect that these sources will continue to be our principal sources of cash in the future. We recorded profits for the year of ￦ 1,386 billion in 2022, ￦ 972 billion in 2023 and ￦ 407 billion in 2024 as discussed in “Item 5.A.
For all of our bandwidth licenses, we made aggregate payments of ￦ 603 billion in 2021, ￦ 319 billion in 2022 and ￦ 327 billion in 2023. The following table sets forth our outstanding payment obligations relating to our bandwidth licenses as of December 31, 2023.
For all of our bandwidth licenses, we made aggregate payments of ￦ 319 billion in 2022, ￦ 327 billion in 2023 and ￦ 299 billion in 2024. The following table sets forth our outstanding payment obligations relating to our bandwidth licenses as of December 31, 2024.
Our five operating segments for financial reporting purposes are organized as the following: • the ICT segment, which primarily consists of KT Corporation on a standalone basis that is primarily engaged in providing various telecommunications and platform services to individual, household and corporate customers as well as selling handsets; • the finance segment, which engages in providing various financial services such as credit card services and value-added network and payment gateway services; • the satellite TV segment, which engages in satellite TV services; • the real estate segment, which engages in real property development and leasing services; and • the others segment, which includes (i) information technology and network services, (ii) contents and commerce services, (iii) security services, (iv) satellite service, (v) global business services that provide global network services to multinational or domestic corporate customers and telecommunications companies and (vi) miscellaneous services provided by our subsidiaries. 46 Table of Contents Our future performance will depend at least in part on Korea’s general economic growth and prospects.
Our five operating segments for financial reporting purposes are organized as the following: • the ICT segment, which primarily consists of KT Corporation on a standalone basis that is primarily engaged in providing various telecommunications and platform services to individual, household and corporate customers as well as selling handsets; • the finance segment, which engages in providing various financial services such as credit card services and value-added network and payment gateway services; • the satellite TV segment, which engages in satellite TV services; • the real estate segment, which engages in real property development and leasing services; and • the others segment, which includes (i) information technology and network services, (ii) contents and commerce services, (iii) security services, (iv) satellite service, (v) global business services that provide global network services to multinational or domestic corporate customers and telecommunications companies and (vi) miscellaneous services provided by our subsidiaries.
Spectrum Bandwidth License Acquisition Date Total Payable Amount (in billions of Won) Total remaining amount (in billions of Won) Initial Payment Amount (in billions of Won) Initial Payment Year Annual Usage Fee (in billions of Won) Annual Usage Fee Payment Term 900 MHz 20 MHz July 1, 2021 ￦ 141 ￦ 67 ￦ 35 2021 ￦ 21 2021 to 2026 1.8 GHz 35 MHz July 1, 2021 ￦ 548 ￦ 260 ￦ 137 2021 ￦ 82 2021 to 2026 1.8 GHz 20 MHz Aug. 4, 2016 ￦ 470 ￦ 111 ￦ 118 2016 ￦ 35 2016 to 2026 2.1 GHz 40 MHz Dec. 6, 2021 ￦ 412 ￦ 195 ￦ 103 2021 ￦ 62 2021 to 2026 3.5 GHz 100 MHz Dec. 1, 2018 ￦ 968 ￦ 392 ￦ 242 2018 ￦ 73 2018 to 2028 47 Table of Contents Researching and Implementing Technology Upgrades and Additional Telecommunications Services such as 5G Technologies The telecommunications industry is characterized by continued advances and improvements in telecommunications technology, and we have been continually researching and implementing network upgrades and launching additional telecommunications services to maintain our competitiveness.
Spectrum Bandwidth License Acquisition Date Total Payable Amount (in billions of Won) Total remaining amount (in billions of Won) Initial Payment Amount (in billions of Won) Initial Payment Year Annual Usage Fee (in billions of Won) Annual Usage Fee Payment Term 900 MHz 20 MHz July 1, 2021 ￦ 141 ￦ 42 ￦ 35 2021 ￦ 21 2022 to 2026 1.8 GHz 35 MHz July 1, 2021 ￦ 548 ￦ 164 ￦ 137 2021 ￦ 82 2022 to 2026 1.8 GHz 20 MHz Aug. 4, 2016 ￦ 470 ￦ 70 ￦ 118 2016 ￦ 35 2017 to 2026 2.1 GHz 40 MHz Dec. 6, 2021 ￦ 412 ￦ 124 ￦ 103 2021 ￦ 62 2022 to 2026 3.5 GHz 100 MHz Dec. 1, 2018 ￦ 968 ￦ 292 ￦ 242 2018 ￦ 73 2019 to 2028 Researching and Implementing Technology Upgrades and Additional Telecommunications Services such as 5G Technologies The telecommunications industry is characterized by continued advances and improvements in telecommunications technology, and we have been continually researching and implementing network 48 Table of Contents upgrades and launching additional telecommunications services to maintain our competitiveness.
Of the ￦ 10,218 billion total borrowings (including short-term borrowings) outstanding as of December 31, 2023, ￦ 2,801 billion was denominated in foreign currencies. See Note 15 of the notes to the Consolidated Financial Statements. Upon the identification and evaluation of our currency risk exposures, we, having considered various circumstances, enter into derivative financial instruments to manage such risks.
Of the ￦ 10,521 billion total borrowings (including short-term borrowings) outstanding as of December 31, 2024, ￦ 3,353 billion was denominated in foreign currencies. See Note 15 of the notes to the Consolidated Financial Statements. Upon the identification and evaluation of our currency risk exposures, we, having considered various circumstances, enter into derivative financial instruments to manage such risks.
Risk Factors—If economic conditions in Korea deteriorate, our current business and future growth could be materially and adversely affected” and “—COVID-19 and any possible occurrences of other types of widespread infectious diseases could materially and adversely affect our business, financial condition or results of operations.” A number of other developments have had or are expected to have a material impact on our results of operations, financial condition and capital expenditures.
Risk Factors—If economic conditions in Korea deteriorate, our current business and future growth could be materially and adversely affected” and “—Occurrences of widespread infectious diseases 47 Table of Contents could materially and adversely affect our business, financial condition or results of operations.” A number of other developments have had or are expected to have a material impact on our results of operations, financial condition and capital expenditures.
In addition, we used cash of ￦ 752 billion in 2021, ￦ 545 billion in 2022 and ￦ 479 billion in 2023 for the acquisition of intangible assets, which consisted primarily of acquisition of bandwidth licenses.
In addition, we used cash of ￦ 545 billion in 2022, ￦ 479 billion in 2023 and ￦ 439 billion in 2024 for the acquisition of intangible assets, which consisted primarily of acquisition of bandwidth licenses.
Liquidity We had a working capital (current assets minus current liabilities) surplus of ￦ 1,786 billion as of December 31, 2021, ￦ 1,991 billion as of December 31, 2022 and ￦ 1,347 billion as of December 31, 2023.
Liquidity We had a working capital (current assets minus current liabilities) surplus of ￦ 1,991 billion as of December 31, 2022, ￦ 1,347 billion as of December 31, 2023 and ￦ 340 billion as of December 31, 2024.
In our financing activities, we used cash of ￦ 1,999 billion in 2021, ￦ 2,843 billion in 2022 and ￦ 5,275 billion in 2023, for repayments of borrowings. From time to time, we may also require capital for investments involving acquisitions, including shares of our affiliates, and strategic relationships, as well as repurchases of our shares.
In our financing activities, we used cash of ￦ 2,843 billion in 2022, ￦ 5,275 billion in 2023 and ￦ 4,733 billion in 2024, for repayments of borrowings (including debentures). From time to time, we may also require capital for investments involving acquisitions, including shares of our affiliates, and strategic relationships, as well as repurchases of our shares.
In our ordinary course of business, we routinely enter into commercial commitments for various aspects of our operations, including repair and maintenance. We have also provided guarantees to our affiliates. See Note 19 of the notes to the Consolidated Financial Statements for a disclosure of the guarantees provided.
Payments of contractual obligations and commitments will also require considerable resources. In our ordinary course of business, we routinely enter into commercial commitments for various aspects of our operations, including repair and maintenance. We have also provided guarantees to our affiliates. See Note 19 of the notes to the Consolidated Financial Statements for a disclosure of the guarantees provided.
We had net proceeds from borrowings and debentures, after adjusting for repayments of borrowings and debentures, of ￦ 900 billion in 2021, ￦ 1,391 billion in 2022 and ￦ 106 billion in 2023.
We had net proceeds from borrowings and debentures, after adjusting for repayments of borrowings and debentures, of ￦ 1,391 billion in 2022 and ￦ 106 billion in 2023, and net repayments of borrowings and debentures, after adjusting for proceeds from borrowings and debentures, of ￦ 135 billion in 2024.
Segment Results—ICT The following table presents selected income statement data of the ICT segment and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Operating revenue ￦ 18,697 ￦ 18,699 ￦ 2 0.0 % Operating expenses 17,350 17,506 156 0.9 Operating income 1,347 1,193 (154 ) (11.4 ) Depreciation and amortization (1) 3,106 3,183 78 2.5 (1) Sum of the amortization of tangible assets, intangible assets, investment properties and right-of-use assets.
Our net profit margin, which is net profit for the year as a percentage of operating revenue, was 5.3% in 2022 and 3.7% in 2023. 65 Table of Contents Segment Results—ICT The following table presents selected income statement data of the ICT segment and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Operating revenue ￦ 18,697 ￦ 18,699 ￦ 2 0.0 % Operating expenses 17,350 17,506 156 0.9 Operating income 1,347 1,193 (154 ) (11.4 ) Depreciation and amortization (1) 3,106 3,183 78 2.5 (1) Sum of the amortization of tangible assets, intangible assets, investment properties and right-of-use assets.
Our operating margin, which is operating profit as a percentage of operating revenue, was 7.5% in 2022 and 5.4% in 2023. 55 Table of Contents Finance Income (Costs) The following table presents a breakdown of our finance income and costs and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Interest income ￦ 272 ￦ 280 ￦ 8 2.8 % Gain on foreign currency transactions 68 27 (41 ) (59.7 ) Gain on foreign currency translation 43 12 (31 ) (72.3 ) Gain on settlement of derivatives 51 12 (38 ) (75.7 ) Gain on valuation of derivatives 183 50 (133 ) (72.7 ) Gain on disposal of trade receivables — 3 3 N.A.
Finance Income (Costs) The following table presents a breakdown of our finance income and costs and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Interest income ￦ 272 ￦ 280 ￦ 8 2.8 % Gain on foreign currency transactions 68 27 (41 ) (59.7 ) Gain on foreign currency translation 43 12 (31 ) (72.3 ) Gain on settlement of derivatives 51 12 (38 ) (75.7 ) Gain on valuation of derivatives 183 50 (133 ) (72.7 ) Gain on disposal of trade receivables — 3 3 N.A.
Liquidity and Capital Resources The following table sets forth the summary of our cash flows for the years indicated: For the Years Ended December 31, 2021 2022 2023 (In billions of Won) Net cash inflow from operating activities ￦ 5,562 ￦ 3,597 ￦ 5,503 Net cash outflow from investing activities (5,137 ) (4,839 ) (4,621 ) Net cash inflow (outflow) from financing activities (41 ) 669 (453 ) Cash and cash equivalents at beginning of the year 2,635 3,020 2,449 Cash and cash equivalents at end of the year 3,020 2,449 2,880 Net increase (decrease) in cash and cash equivalents 384 (571 ) 430 Capital Requirements Historically, our capital requirements consisted principally of purchases of property and equipment and other assets and repayments of borrowings.
Liquidity and Capital Resources The following table sets forth the summary of our cash flows for the years indicated: For the Years Ended December 31, 2022 2023 2024 (In billions of Won) Net cash inflow from operating activities ￦ 3,597 ￦ 5,503 ￦ 5,066 Net cash outflow from investing activities (4,839 ) (4,621 ) (2,845 ) Net cash inflow (outflow) from financing activities 669 (453 ) (1,390 ) Cash and cash equivalents at beginning of the year 3,020 2,449 2,880 Cash and cash equivalents at end of the year 2,449 2,880 3,717 Net increase (decrease) in cash and cash equivalents (571 ) 430 837 68 Table of Contents Capital Requirements Historically, our capital requirements consisted principally of purchases of property and equipment and other assets and repayments of borrowings.
In our investing activities, we used cash of ￦ 3,495 billion in 2021, ￦ 3,440 billion in 2022 and ￦ 3,693 billion in 2023, for the acquisition of property and equipment and investment properties.
In our investing activities, we used cash of ￦ 3,440 billion in 2022, ￦ 3,693 billion in 2023 and ￦ 2,909 billion in 2024, for the acquisition of property and equipment and investment properties.
We used cash of ￦ 194 billion in 2021, ￦ 0 in 2022 and ￦ 300 billion in 2023 for the repurchase of our shares. Our cash dividends paid to shareholders and non-controlling interests amounted to ￦ 350 billion in 2021, ￦ 477 billion in 2022 and ￦ 527 billion in 2023.
We used cash of ￦ 0 in 2022, ￦ 300 billion in 2023 and ￦ 27 billion in 2024 for the repurchase of our shares. Our cash dividends paid to shareholders and non-controlling interests amounted to ￦ 477 billion in 2022, ￦ 527 billion in 2023 and ￦ 872 billion in 2024.
The following table sets forth the summary of our significant current assets for the years indicated: As of December 31, 2021 2022 2023 (In billions of Won) Cash and cash equivalents ￦ 3,020 ￦ 2,449 ￦ 2,880 Trade and other receivables, net 5,087 6,098 7,170 Inventories, net 514 718 988 Other financial assets 1,186 1,322 1,440 Our cash and cash equivalents (substantially all of which are in Won) totaled ￦ 3,020 billion as of December 31, 2021, ￦ 2,449 billion as of December 31, 2022 and ￦ 2,880 billion as of December 31, 2023.
The following table sets forth the summary of our significant current assets for the years indicated: As of December 31, 2022 2023 2024 (In billions of Won) Cash and cash equivalents ￦ 2,449 ￦ 2,880 ￦ 3,717 Trade and other receivables, net 6,098 7,170 6,147 Inventories, net 718 988 1,055 Other financial assets 1,322 1,440 1,344 Our cash and cash equivalents (substantially all of which are in Won) totaled ￦ 2,449 billion as of December 31, 2022, ￦ 2,880 billion as of December 31, 2023 and ￦ 3,717 billion as of 70 Table of Contents December 31, 2024.
However, the actual amount remains subject to adjustment depending on market conditions, our results of operations and changes in our build-out plan for our 5G mobile telecommunications network. We may also require capital for purchase of shares of our affiliates as well as investments involving acquisitions and strategic relationships. Payments of contractual obligations and commitments will also require considerable resources.
However, the actual amount remains subject to adjustment depending on market conditions, our results of operations and changes in our build-out plan for our telecommunications network and other infrastructure. We may also require capital for purchase of shares of our affiliates as well as investments involving acquisitions and strategic relationships.
(1) Gain on valuation of financial instruments 31 32 1 4.7 Others 43 69 26 62.0 Total finance income ￦ 690 ￦ 486 (204 ) (29.6 ) Interest expenses ￦ 294 ￦ 356 62 21.3 Loss on foreign currency transactions 81 34 (47 ) (57.8 ) Loss on foreign currency translation 200 96 (104 ) (52.2 ) Loss on settlement of derivatives 24 0 (24 ) (98.3 ) Loss on valuation of derivatives 22 7 (15 ) (69.5 ) Loss on disposal of trade receivables 63 18 (45 ) (71.3 ) Loss on valuation of financial instruments 66 55 (11 ) (16.2 ) Others 0 2 2 370.5 Total finance costs ￦ 750 ￦ 569 (181 ) (24.2 ) N.A. means not available.
(1) Gain on valuation of financial instruments 31 32 1 4.7 Others 43 69 26 62.0 Total finance income ￦ 690 ￦ 486 (204 ) (29.6 ) Interest expenses ￦ 294 ￦ 356 62 21.3 Loss on foreign currency transactions 81 34 (47 ) (57.8 ) Loss on foreign currency translation 200 96 (104 ) (52.2 ) Loss on settlement of derivatives 24 0 (24 ) (98.3 ) Loss on valuation of derivatives 22 7 (15 ) (69.5 ) Loss on disposal of trade receivables 63 18 (45 ) (71.3 ) Loss on valuation of financial instruments 66 55 (11 ) (16.2 ) Others 0 2 2 370.5 Total finance costs ￦ 750 ￦ 569 (181 ) (24.2 ) N.A. means not available. 64 Table of Contents Our interest expenses increased by 21.3%, or ￦ 62 billion, from ￦ 294 billion in 2022 to ￦ 356 billion in 2023 primarily due to general increases in interest rates in Korea and abroad in 2023 compared to 2022.
We currently expect our capital expenditures for the acquisition of property and equipment and investment property and acquisition of intangible assets in 2024 to decrease slightly compared to those in 2023 on a standalone basis.
We currently expect our capital expenditures for the acquisition of property and equipment and investment property and acquisition of intangible assets in 2025 to remain at a similar level compared to those in 2024 on a standalone basis.
The following table sets forth the summary of our significant current liabilities for the years indicated: As of December 31, 2021 2022 2023 (In billions of Won) Trade and other payables ￦ 6,641 ￦ 7,333 ￦ 8,055 Borrowings 1,731 1,827 3,059 Substantially all of our revenues are denominated in Won.
Quantitative and Qualitative Disclosures about Market Risk. The following table sets forth the summary of our significant current liabilities for the years indicated: As of December 31, 2022 2023 2024 (In billions of Won) Trade and other payables ￦ 7,333 ￦ 8,055 ￦ 7,395 Borrowings 1,827 3,059 3,905 Substantially all of our revenues are denominated in Won.
The operating revenue for our real estate segment, prior to adjusting for inter-segment transactions, increased by 5.3%, or ￦ 25 billion, from ￦ 475 billion in 2022 to ￦ 500 billion in 2023 primarily due to increases in revenues from apartment presales and hotel operations.
The operating revenue for our real estate segment, prior to adjusting for inter-segment transactions, increased by 9.4%, or ￦ 47 billion, from ￦ 500 billion in 2023 to ￦ 547 billion in 2024 primarily due to increases in revenues from apartment presales and hotel operations.
Segment Results—Others The following table presents selected income statement data of the others segment and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Operating revenue ￦ 7,960 ￦ 8,145 ￦ 185 2.3 % Operating expenses 7,487 8,048 561 7.5 Operating income 473 98 (376 ) (79.4 ) Depreciation and amortization (1) 575 585 10 1.7 (1) Sum of the amortization of tangible assets, intangible assets, investment properties and right-of-use assets. 59 Table of Contents The operating revenue for our others segment, prior to adjusting for inter-segment transactions, increased by 2.3%, or ￦ 185 billion, from ￦ 7,960 billion in 2022 to ￦ 8,145 billion in 2023, primarily due to an increase in revenue from our information technology and network services, particularly from the operation of Internet data centers and systems integration services.
Segment Results—Others The following table presents selected income statement data of the others segment and changes therein for 2023 and 2024: For the Year Ended December 31, Changes 2023 vs. 2024 2023 2024 Amount % (In billions of Won) Operating revenue ￦ 8,145 ￦ 8,223 ￦ 78 1.0 % Operating expenses 8,048 8,157 110 1.4 Operating income 98 66 (32 ) (32.8 ) Depreciation and amortization (1) 585 605 20 3.4 (1) Sum of the amortization of tangible assets, intangible assets, investment properties and right-of-use assets. 60 Table of Contents The operating revenue for our others segment, prior to adjusting for inter-segment transactions, increased by 1.0%, or ￦ 78 billion, from ￦ 8,145 billion in 2023 to ￦ 8,223 billion in 2024, primarily due to an increase in revenue from our information technology and network services, particularly from the operation of Internet data centers and systems integration services.
Segment Results—Real Estate The following table presents selected income statement data of the real estate segment and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Operating revenue ￦ 475 ￦ 500 ￦ 25 5.3 % Operating expenses 362 427 65 17.9 Operating income 113 73 (40 ) (35.0 ) Depreciation and amortization (1) 65 71 5 7.9 (1) Sum of the amortization of tangible assets, intangible assets, investment properties and right-of-use assets.
Segment Results—Real Estate The following table presents selected income statement data of the real estate segment and changes therein for 2022 and 2023: For the Year Ended December 31, Changes 2022 vs. 2023 2022 2023 Amount % (In billions of Won) Operating revenue ￦ 475 ￦ 500 ￦ 25 5.3 % Operating expenses 362 427 65 17.9 Operating income 113 73 (40 ) (35.0 ) Depreciation and amortization (1) 65 71 5 7.9 (1) Sum of the amortization of tangible assets, intangible assets, investment properties and right-of-use assets. 67 Table of Contents The operating revenue for our real estate segment, prior to adjusting for inter-segment transactions, increased by 5.3%, or ￦ 25 billion, from ￦ 475 billion in 2022 to ￦ 500 billion in 2023 primarily due to increases in revenues from apartment presales and hotel operations.
Critical Accounting Estimates Our financial statements are prepared in accordance with IFRS as issued by IASB. See Note 3 of the notes to our financial statements for a discussion of our critical accounting estimates. Item 6. Directors, Senior Management and Employees
Item 5.D. Trend Information These matters are discussed under Item 5.A. above where relevant. Item 5.E. Critical Accounting Estimates Our financial statements are prepared in accordance with IFRS as issued by IASB. See Note 3 of the notes to our financial statements for a discussion of our critical accounting estimates. Item 6. Directors, Senior Management and Employees
Our net profit margin, which is net profit for the year as a percentage of operating revenue, was 5.3% in 2022 and 3.7% in 2023.
Our net profit margin, which is net profit for the year as a percentage of operating revenue, decreased from 3.7% in 2023 to 1.5% in 2024.
Our total equity was ￦ 16,567 billion as of December 31, 2021, ￦ 18,413 billion as of December 31, 2022 and ￦ 18,543 billion as of December 31, 2023.
Our total equity was ￦ 18,413 billion as of December 31, 2022, ￦ 18,543 billion as of December 31, 2023 and ￦ 17,968 billion as of December 31, 2024.
For a description of recent developments that have had and may continue to have an adverse effect on our results of operations and financial condition, see “Item 3. Key Information—Item 3.D.
Our future performance will depend at least in part on Korea’s general economic growth and prospects. For a description of recent developments that have had and may continue to have an adverse effect on our results of operations and financial condition, see “Item 3. Key Information—Item 3.D.
As of December 31, 2023, on a standalone basis, we held approximately 99.8% of our cash and cash equivalents denominated in Won and the remainder denominated in foreign currencies. Other current financial assets primarily consist of financial instruments, available-for-sale financial assets and derivative assets used for hedging.
As of December 31, 2024, we held approximately 97.3% of our cash and cash equivalents denominated in Won and the remainder denominated in foreign currencies. Other current financial assets primarily consist of financial instruments, available-for-sale financial assets and derivative assets used for hedging. For a discussion of our use of financial instruments for hedging purposes, see “Item 11.
As of December 31, 2023, we 62 Table of Contents entered into various commitments with financial institutions totaling ￦ 3,497 billion, US$2,047 million, EUR 8 million and SGD 400 million, of which ￦ 620 billion, US$2,047 million, EUR 8 million and SGD 400 million were used. See Note 19 of the notes to the Consolidated Financial Statements.
As of December 31, 2024, we entered into various commitments with financial institutions totaling ￦ 3,415 billion, US$2,185 million, and EUR 7 million, of which ￦ 542 billion, US$2,185 million and EUR 7 million were used. See Note 19 of the notes to the Consolidated Financial Statements.
Furthermore, pursuing acquisitions, joint venture and certain investment transactions also requires significant capital, and as we pursue further growth opportunities for the future, we may need to raise additional capital by incurring loans or through the issuances of bonds or other securities in the international capital markets, which may lead to increased levels of debt and debt servicing costs in the future.
The identification of suitable acquisition candidates can be difficult, time-consuming and costly, and our financial condition and results of operations may be affected as a result of such acquisitions, disposals or consolidation. 49 Table of Contents Furthermore, pursuing acquisitions, joint venture and certain investment transactions also requires significant capital, and as we pursue further growth opportunities for the future, we may need to raise additional capital by incurring loans or through the issuances of bonds or other securities in the international capital markets, which may lead to increased levels of debt and debt servicing costs in the future.
Operating Profit Due to the factors described above, our operating profit decreased by 27.4%, or ￦ 540 billion, from ￦ 1,968 billion in 2022 to ￦ 1,428 billion in 2023.
Operating Profit Due to the factors described above, our operating profit decreased by 27.4%, or ￦ 540 billion, from ￦ 1,968 billion in 2022 to ￦ 1,428 billion in 2023. Our operating margin, which is operating profit as a percentage of operating revenue, was 7.5% in 2022 and 5.4% in 2023.
Our loss on disposal of trade receivables decreased by 71.3%, or ￦ 45 billion, from ￦ 63 billion in 2022 to ￦ 18 billion in 2023 primarily due to a decrease in loss from our sale of handset receivables. 56 Table of Contents Share of Net Losses of Associates and Joint Ventures Our share of net losses of associates and joint ventures increased by 151.2%, or ￦ 26 billion, from ￦ 17 billion in 2022 to ￦ 43 billion in 2023.
Our loss on disposal of trade receivables decreased by 71.3%, or ￦ 45 billion, from ￦ 63 billion in 2022 to ￦ 18 billion in 2023 primarily due to a decrease in loss from our sale of handset receivables.
For this segment, operating margin, which is operating profit as a percentage of total operating revenue prior to adjusting for inter-segment transactions, decreased from 7.2% in 2022 to 6.4% in 2023. 57 Table of Contents Depreciation and amortization for our ICT segment, prior to adjusting for inter-segment transactions, increased by 2.5%, or ￦ 78 billion, from ￦ 3,106 billion in 2022 to ￦ 3,183 billion in 2023.
For this segment, operating margin, which is operating profit as a percentage of total operating revenue prior to adjusting for inter-segment transactions, decreased from 7.2% in 2022 to 6.4% in 2023.
Long-term borrowings, excluding current installments, were ￦ 6,706 billion in December 31, 2021, ￦ 8,180 billion in December 31, 2022 and ￦ 7,160 billion as of December 31, 2023. Total short-term borrowings were ￦ 1,731 billion as of December 31, 2021, ￦ 1,827 billion as of December 31, 2022 and ￦ 3,059 billion as of December 31, 2023.
Long-term borrowings, excluding current installments, were ￦ 8,180 billion in December 31, 2022, ￦ 7,160 billion as of December 31, 2023 and ￦ 6,616 billion as of December 31, 69 Table of Contents 2024.
Total operating revenue increased by 1.4%, or ￦ 361 billion, from ￦ 26,234 billion in 2022 to ￦ 26,595 billion in 2023 primarily due to increases in revenue from data communication services, 52 Table of Contents financial services, mobile services, media and content services and broadband Internet access services, which impact was partially offset by decreases in revenue from fixed-line and VoIP telephone services and sale of goods.
Total operating revenue increased by 0.5%, or ￦ 129 billion, from ￦ 26,595 billion in 2023 to ￦ 26,724 billion in 2024 primarily due to increases in revenue from our information technology and network services categorized as “others” (particularly from the operation of Internet data centers and systems integration services), mobile services, sale of goods and broadband Internet access services, which impact was partially offset by decreases in revenue from financial services, media and content services and fixed-line and VoIP telephone services.
We periodically increase our short-term borrowings and adjust our long-term debt financing levels depending on changes in our capital requirements. For the maturity profile of our borrowings, their currency denomination and interest rates, see Note 15 of the notes to the Consolidated Financial Statements.
For the maturity profile of our borrowings, their currency denomination and interest rates, see Note 15 of the notes to the Consolidated Financial Statements.
Operating Revenue and Operating Expenses Operating Revenue Our operating revenue primarily consists of: • fees related to our mobile services, including monthly fees, usage charges for outgoing calls, usage charges for wireless data transmission, contents download fees, mobile-to-mobile interconnection revenue and value-added monthly service fees; • fees from our fixed-line services, including: Ø fees from our fixed-line and VoIP telephone services, which include: Ø monthly basic charges, which are one-time or monthly fixed charges primarily consisting of (i) non-refundable activation fees; and (ii) monthly fixed charges from local telephone services (or monthly fixed charges for discount plans); Ø monthly usage charges, which are usage fees based on the amount of services used, primarily consisting of (i) monthly usage charges for local telephone and domestic long distance services; (ii) international long-distance service revenue, (primarily (a) amounts we bill to our customers for outgoing calls made to foreign countries, (b) amounts we bill to foreign telecommunications carriers for connection to the domestic telephone network in respect of incoming calls at the applicable settlement rate, and (c) other revenue, including revenue from international leased lines); (iii) land-to-mobile and land-to-land interconnection revenue; and (iv) interconnection fees we charge to fixed-line and mobile service providers and voice resellers for their use of our local, domestic long-distance and international networks in providing their services; and 50 Table of Contents Ø other revenue from (i) value-added services, local telephone directory assistance, call waiting and caller identification services; and (ii) local, domestic long-distance and international calls placed from public telephones; Ø broadband Internet access service revenue, primarily consisting of installation fees and basic monthly charges; and Ø data communication services, primarily consisting of installation fees and basic monthly charges for our fixed-line and satellite leased line services and Kornet Internet connection service; • revenue from media and content services, primarily consisting of installation fees and basic monthly charges of IPTV and satellite TV services, as well as revenue from digital music services, e-commerce services, online advertising consulting services and web comics and novels services; • financial service revenue, primarily consisting of fees from credit card services provided by BC Card, our consolidated subsidiary in which we held a 69.5% interest as of December 31, 2023; • revenue from our miscellaneous business activities categorized as “others,” including information technology and network services and rental of real estate; and • revenue from sale of goods, primarily handsets related to our mobile services and miscellaneous telecommunications equipment, as well as sale of residential units and commercial real estate developed by KT Estate.
The table below sets forth a reconciliation of our operating profit and net income or loss as presented in our consolidated statements of profit or loss prepared in accordance with IFRS as issued by the IASB for each of the years ended December 31, 2022, 2023 and 2024 to our operating profit and net income or loss in our consolidated statements of profit or loss prepared in accordance with K-IFRS, for each of the corresponding years, taking into account such differences: For the Year Ended December 31, 2022 2023 2024 (In billions of Won) Operating profit under IFRS as issued by the IASB ￦ 1,968 ￦ 1,428 ￦ 640 Differences under K-IFRS requiring other income and other expenses to be distinguished from operating revenue (280 ) 200 156 Revenue recognition of development, sale of real estate, etc. 3 22 13 Operating profit under K-IFRS ￦ 1,690 ￦ 1,650 ￦ 809 For the Year Ended December 31, 2022 2023 2024 (In billions of Won) Net income under IFRS as issued by the IASB ￦ 1,386 ￦ 972 ￦ 407 Revenue recognition of development, sale of real estate, etc. 3 22 13 Income tax (1 ) (5 ) (3 ) Profit for the year under K-IFRS ￦ 1,388 ￦ 989 ￦ 417 Changes in Accounting Policies For a summary of new standards, amendments and interpretations issued under IFRS as issued by the IASB, see Note 2.2 of the notes to the Consolidated Financial Statements. 50 Table of Contents Operating Revenue and Operating Expenses Operating Revenue Our operating revenue primarily consists of: • fees related to our mobile services, including monthly fees, usage charges for outgoing calls, usage charges for wireless data transmission, contents download fees, mobile-to-mobile interconnection revenue and value-added monthly service fees; • fees from our fixed-line services, including: Ø broadband Internet access service revenue, primarily consisting of installation fees and basic monthly charges; Ø fees from our fixed-line and VoIP telephone services, which include: Ø monthly basic charges, which are one-time or monthly fixed charges primarily consisting of (i) non-refundable activation fees; and (ii) monthly fixed charges from local telephone services (or monthly fixed charges for discount plans); Ø monthly usage charges, which are usage fees based on the amount of services used, primarily consisting of (i) monthly usage charges for local telephone and domestic long distance services; (ii) international long-distance service revenue, (primarily (a) amounts we bill to our customers for outgoing calls made to foreign countries, (b) amounts we bill to foreign telecommunications carriers for connection to the domestic telephone network in respect of incoming calls at the applicable settlement rate, and (c) other revenue, including revenue from international leased lines); (iii) land-to-mobile and land-to-land interconnection revenue; and (iv) interconnection fees we charge to fixed-line and mobile service providers and voice resellers for their use of our local, domestic long-distance and international networks in providing their services; and Ø other revenue from (i) value-added services, local telephone directory assistance, call waiting and caller identification services; and (ii) local, domestic long-distance and international calls placed from public telephones; and Ø data communication services, primarily consisting of installation fees and basic monthly charges for our fixed-line and satellite leased line services and Kornet Internet connection service; • revenue from media and content services, primarily consisting of installation fees and basic monthly charges of IPTV and satellite TV services, as well as revenue from digital music services, e-commerce services, online advertising consulting services and web comics and novels services; • financial service revenue, primarily consisting of fees from credit card services provided by BC Card, our consolidated subsidiary in which we held a 69.5% interest as of December 31, 2024; • revenue from our miscellaneous business activities categorized as “others,” including information technology and network services and rental of real estate; and • revenue from sale of goods, primarily handsets related to our mobile services and miscellaneous telecommunications equipment, as well as sale of residential units and commercial real estate developed by KT Estate. 51 Table of Contents Operating Expenses Our operating expenses primarily include: • employee benefit costs, including salaries and wages, post-employment benefits, termination benefits (including severance benefits for voluntary and special early retirements) and share-based payments; • purchase of inventories, primarily consisting of (i) inventories purchased for our sale of mobile handsets and (ii) development costs of KT Estate for real estate units to be sold, and changes of inventories, which reflects increases or decreases of inventories of handsets, phones and for-sale real estate units during the applicable period; • card service costs, primarily consisting of costs in connection with credit and cash card services provided by BC Card, including fees paid to member credit card companies in our network for marketing expenses; • depreciation expenses incurred primarily in connection with our telecommunications network facilities; • sales commissions, primarily consisting of sales commissions to third-party dealers related to procurement of mobile subscribers and mobile handset sales; • service cost, primarily consisting of payments to IPTV and satellite TV content providers; • commissions, primarily consisting of commission-based payments for certain third-party outsourcing services, including commissions to the outsourced call center staff; • amortization expenses incurred primarily in connection with our intangible assets; and • interconnection charges, which are interconnection payments to telecommunication service providers for calls from landline users and our mobile subscribers to our competitors’ subscribers.
In order to maintain our leadership in the converging telecommunications business environment and develop additional platforms, services and applications, we engage in research and development (“R&D”) activities together with our various business units and also operate the following R&D laboratories: • Small Language Model Development (“AI2XL”) R&D laboratory; • Multi Large Language Model Enterprise Go-to-Market Technology (“AI Tech”) R&D laboratory; • Machine Learning and Deep Learning (“AI Service”) R&D laboratory; and • New Emerging Technology (“Service Tech”) R&D laboratory.
In order to maintain our leadership in the converging telecommunications business environment and develop additional platforms, services and applications, we engage in research and development (“R&D”) activities together with our various business units and also operate the following R&D laboratories: • Responsible AI Policy and Technology Leadership (“AI Future”) R&D laboratory; • Development of Multi-Modal AI Core Technologies (“Gen AI”) R&D laboratory; • Development of AI Agent Core Technologies and Commercial Agents (“Agentic”) R&D laboratory; and • Implementation of Data Science Across KT’s Business and CDO Office (“Decision Intelligence”) R&D laboratory.
Our interest expenses increased by 21.3%, or ￦ 62 billion, from ￦ 294 billion in 2022 to ￦ 356 billion in 2023 primarily due to general increases in interest rates in Korea and abroad in 2023 compared to 2022.
Our interest income increased by 8.6%, or ￦ 24 billion, from ￦ 280 billion in 2023 to ￦ 304 billion in 2024 primarily due to an increase in our interest-earning cash and cash equivalents in 2024 compared to 2023. 57 Table of Contents Our interest expenses increased by 5.1%, or ￦ 18 billion, from ￦ 356 billion in 2023 to ￦ 375 billion in 2024 primarily due to general increases in interest rates in Korea and abroad in 2024 compared to 2023.
As of December 31, 2023, KT Corporation had 3,868 domestic and 1,895 international registered patents. The MSIT has the authority to recommend to network service providers that they provide funds for national research and development of telecommunications technology and related projects.
The MSIT has the authority to recommend to network service providers that they provide funds for national research and development of telecommunications technology and related projects. 71 Table of Contents Including such contributions, total expenditures (which include capitalized expenses) on research and development were ￦ 231 billion in 2022, ￦ 225 billion in 2023 and ￦ 212 billion in 2024.
Removed
The identification of suitable acquisition candidates can be difficult, time-consuming and costly, and our financial condition and results of operations may be affected as a result of such acquisitions, disposals or consolidation.
Added
Operating Results—2024 Compared to 2023 The following table presents selected income statement data and changes therein for 2023 and 2024: For the Year Ended December 31, Changes 2023 vs. 2024 2023 2024 Amount % (In billions of Won) Operating revenue ￦ 26,595 ￦ 26,724 ￦ 129 0.5 % Operating expenses 25,167 26,084 918 3.6 Operating profit 1,428 640 (788 ) (55.2 ) Finance income 486 918 431 88.7 Finance costs 569 995 426 74.9 Share of net profits of associates and joint ventures (43 ) 9 52 N.A.
Removed
Marketing Activities In January 2024, the Government announced its plan to repeal the Mobile Device Distribution Improvement Act, which remains subject to passage by the National Assembly of the Republic of Korea, in order to encourage mobile service providers to offer differentiated benefits to customers.
Added
(1) Profit before income tax 1,303 572 (731 ) (56.1 ) Income tax expense 330 165 (165 ) (50.0 ) Profit for the year ￦ 972 ￦ 407 (566 ) (58.2 ) N.A. means not available. 52 Table of Contents Operating Revenue The following table presents a breakdown of our operating revenue and changes therein for 2023 and 2024: For the Year Ended December 31, Changes 2023 vs. 2024 Products and services 2023 2024 Amount % (In billions of Won) Mobile services ￦ 7,140 ￦ 7,318 ￦ 178 2.5 % Fixed-line services: Fixed-line and VoIP telephone services 1,249 1,188 (61 ) (4.9 ) Broadband Internet access services 2,579 2,634 56 2.2 Data communication services 1,315 1,335 20 1.6 Subtotal 5,142 5,158 15 0.3 Media and content services 3,207 3,107 (99 ) (3.1 ) Financial services 3,968 3,743 (225 ) (5.7 ) Others 3,846 4,025 179 4.7 Sale of goods (1) 3,293 3,374 81 2.5 Total operating revenue ￦ 26,595 ￦ 26,724 129 0.5 (1) Primarily related to sale of handsets for our mobile service and miscellaneous telecommunications equipment, as well as sale of residential units and commercial real estate developed by KT Estate.
Removed
Under the Mobile Device Distribution Improvement Act, a subscriber is entitled to receive either a designated handset subsidy related to the purchase of a recently released mobile phone, or a designated discount on the mobile service subscription rate.
Added
Mobile Services Our mobile services revenue increased by 2.5%, or ￦ 178 billion, from ￦ 7,140 billion in 2023 to ￦ 7,318 billion in 2024 primarily due to increases in our average revenue per subscriber and the number of our MVNO mobile subscribers, as well as the reclassification of revenue generated from KT Skylife related to MVNO mobile subscribers procured by it starting in 2024, which was previously recognized under media and content services.
Removed
In connection with such policy, the Government amended the Enforcement Decree of the Mobile Device Distribution Improvement Act in March 2024, pursuant to which mobile service providers may provide more liberal subsidies to subscribers that are switching their mobile service providers based on certain criteria specified by the KCC, including the estimated profit margins of the mobile service providers and subscribers’ costs of switching their service providers.
Added
Our average revenue per user increased by 1.6%, or ￦ 559, from ￦ 33,965 in 2023 to ￦ 34,524 in 2024 mainly due to an increase in our users subscribing to 5G services and roaming services.
Removed
Any such amendments to, or the repeal of, the Mobile Device Distribution Improvement Act may have a material impact on the competitive landscape of the mobile telecommunications industry as mobile service providers are given more flexibility to provide handset subsidies or discounts, which may in turn increase expenses.
Added
We recorded a 5.0% increase in our mobile subscribers from 24.9 million subscribers as of December 31, 2023 to 26.1 million subscribers as of December 31, 2024 due to (i) a 31.6% increase in our subscribers of mobile services for miscellaneous devices such as tablets and other IoT devices from 4.2 million as of December 31, 2023 to 5.6 million as of December 31, 2024 (primarily from an addition of a significant number of IoT subscribers of Korea Electric Power Corporation’s electricity usage reporting services in the second half of 2024) and (ii) a 0.6% increase in our subscribers of MVNO mobile subscribers from 7.1 million as of December 31, 2023 to 7.2 million as of December 31, 2024, the impact of which was partially offset by a 1.1% decrease in our MNO mobile phone subscribers from 13.5 million as of December 31, 2023 to 13.4 million as of December 31, 2024. 53 Table of Contents Fixed-line Services Our fixed-line services revenue increased by 0.3%, or ￦ 15 billion, from ￦ 5,142 billion in 2023 to ￦ 5,158 billion in 2024, reflecting increases in revenue from broadband Internet access services and data communication services, the impact of which was partially offset by a decrease in revenue from fixed-line and VoIP telephone services.
Removed
While we believe that our large subscriber base as well as the brand power of our products and services will remain key drivers of our growth, we expect to continue to invest significantly in marketing activities, particularly in connection with launching of new products and services.
Added
Our fixed-line and VoIP telephone services revenue decreased by 4.9%, or ￦ 61 billion, from ￦ 1,249 billion in 2023 to ￦ 1,188 billion in 2024 primarily due to a decrease in the number of PSTN and VoIP lines in service from 12.0 million as of December 31, 2023 to 11.5 million as of December 31, 2024.
Removed
Our marketing expenses may not directly correspond to our revenue in the same period, and our quarterly marketing expenses have fluctuated in the past and are expected to continue to fluctuate in the future.
Added
Broadband Internet Access Services. Our broadband Internet access services revenue increased by 2.2%, or ￦ 56 billion, from ￦ 2,579 billion in 2023 to ￦ 2,634 billion in 2024 primarily due to an increase in the number of subscribers to our premium services.
Removed
The table below sets forth a reconciliation of our operating profit and net income or loss as presented in our consolidated statements of profit or loss prepared in accordance with IFRS as issued 49 Table of Contents by the IASB for each of the years ended December 31, 2021, 2022 and 2023 to our operating profit and net income or loss in our consolidated statements of profit or loss prepared in accordance with K-IFRS, for each of the corresponding years, taking into account such differences: For the Year Ended December 31, 2021 2022 2023 (In billions of Won) Operating profit under IFRS as issued by the IASB ￦ 1,699 ￦ 1,968 ￦ 1,428 Differences under K-IFRS requiring other income and other expenses to be distinguished from operating revenue (28 ) (280 ) 200 Revenue recognition of development, sale of real estate, etc. — 3 22 Operating profit under K-IFRS ￦ 1,672 ￦ 1,690 ￦ 1,650 For the Year Ended December 31, 2021 2022 2023 (In billions of Won) Net income under IFRS as issued by the IASB ￦ 1,459 ￦ 1,386 ￦ 972 Revenue recognition of development, sale of real estate, etc. — 3 22 Income tax — 1 (5 ) Profit for the year under K-IFRS ￦ 1,459 ￦ 1,388 ￦ 989 Changes in Accounting Policies For a summary of new standards, amendments and interpretations issued under IFRS as issued by the IASB, see Note 2.2 of the notes to the Consolidated Financial Statements.
Added
The number of our KT GiGA Internet service subscribers increased from approximately 6.7 million as of December 31, 2023 to approximately 6.9 million as of December 31, 2024. Data Communication Services.
Removed
Operating Expenses Our operating expenses primarily include: • purchase of inventories, primarily consisting of (i) inventories purchased for our sale of mobile handsets and (ii) development costs of KT Estate for real estate units to be sold, and changes of inventories, which reflects increases or decreases of inventories of handsets, phones and for-sale real estate units during the applicable period; • salaries and wages, including post-employment benefits, termination benefits (including severance benefits for voluntary and special early retirements) and share-based payments; • card service costs, primarily consisting of costs in connection with credit and cash card services provided by BC Card, including fees paid to member credit card companies in our network for marketing expenses; • depreciation expenses incurred primarily in connection with our telecommunications network facilities; • sales commissions, primarily consisting of sales commissions to third-party dealers related to procurement of mobile subscribers and mobile handset sales; • service cost, primarily consisting of payments to IPTV and satellite TV content providers; 51 Table of Contents • commissions, primarily consisting of commission-based payments for certain third-party outsourcing services, including commissions to the outsourced call center staff; • amortization expenses incurred primarily in connection with our intangible assets; and • interconnection charges, which are interconnection payments to telecommunication service providers for calls from landline users and our mobile subscribers to our competitors’ subscribers.
Added
Our data communication services revenue increased by 1.6%, or ￦ 20 billion, from ￦ 1,315 billion in 2023 to ￦ 1,335 billion in 2024 primarily due to increases in revenue from (i) major content service providers that experienced increases in traffic volume and data usage and (ii) the provision of additional services to local governments, including installations of additional CCTVs as well as enhancements of network lines.
Removed
Operating Results—2021 Compared to 2022 For a discussion of our operating results of 2021 compared to 2022, please see “Item 5.A. Operating Results—Operating Results—2021 Compared to 2022” of our Form 20-F for the fiscal year ended December 31, 2022, which we filed with the Securities and Exchange Commission on April 28, 2023. Item 5.B.
Added
Media and Content Services Our media and content services revenue decreased by 3.1%, or ￦ 99 billion, from ￦ 3,207 billion in 2023 to ￦ 3,107 billion in 2024 primarily due to (i) the reclassification of revenue generated from KT Skylife related to MVNO mobile subscribers procured by it as mobile services starting in 2024, and (ii) a downturn in the content creation and online advertising industries caused by deteriorating economic conditions, which in turn led to decreases in original content productions and online advertisements provided through Nasmedia and PlayD.
Removed
For a discussion of our use of financial instruments for hedging purposes, see “Item 11. Quantitative and Qualitative Disclosures about Market Risk.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

27 edited+4 added−8 removed25 unchanged
In June 2023, we amended our articles of incorporation in efforts to add more rigor and transparency to the process of selecting our Representative Director. Our Director Candidate Recommendation Committee conducts investigation and composition of a pool of candidates and selects the representative director candidates whose candidacy will be further examined.
In June 2023, we amended our articles of incorporation in efforts to add more rigor and transparency to the process of selecting our Representative Director. Our Director Candidate Recommendation Committee conducts the investigation on, and composition of, a pool of candidates and selects the representative director candidates whose candidacy will be further examined.
Subsequently, the Director Candidate Recommendation Committee examines and selects Representative Director candidates and submits an examination report of such candidates to our board of directors. A Representative Director candidate recommended by our board of directors is nominated at the shareholders’ meeting.
Subsequently, the Director Candidate Recommendation Committee examines and selects Representative Director candidates and submits an examination report of such candidates to our board of directors. The Representative Director candidate recommended by our board of directors is nominated at the shareholders’ meeting.
The duties of the committee include: • appointing an independent registered public accounting firm; • approving the appointment and recommending the dismissal of the internal auditor; • evaluating performance of the independent registered public accounting firm; • approving services to be provided by the independent registered public accounting firm; • reviewing annual financial statements; • reviewing audit results and reports; • reviewing and evaluating our system of internal controls and policies • examining improprieties or suspected improprieties; and • on a quarterly basis, reviewing reports on internal controls for legal compliance, including with respect to cybersecurity laws.
The duties of the committee include: • appointing an independent registered public accounting firm; • approving the appointment and recommending the dismissal of the internal auditor; • evaluating performance of the independent registered public accounting firm; 77 Table of Contents • approving services to be provided by the independent registered public accounting firm; • reviewing annual financial statements; • reviewing audit results and reports; • reviewing and evaluating our system of internal controls and policies • examining improprieties or suspected improprieties; and • on a quarterly basis, reviewing reports on internal controls for legal compliance, including with respect to cybersecurity laws.
The committee’s duties include (i) authorizing the investigation and composition of a pool of internal and external Representative Director candidates, (ii) examining the Representative Director candidates selected under the examination criteria determined by our board of directors, selecting the Representative Director candidates pursuant to such criteria and reporting to the board of directors the outcome of the examination and (iii) reviewing the qualifications of outside director candidates and proposing nominees to our shareholders for consideration at the general shareholders’ meeting.
The committee’s duties include (i) authorizing the investigation and composition of a pool of internal and external Representative Director candidates, (ii) examining the Representative Director candidates selected under the examination criteria determined by our board of directors, selecting the Representative Director candidates pursuant to 76 Table of Contents such criteria and reporting to the board of directors the outcome of the examination and (iii) reviewing the qualifications of outside director candidates and proposing nominees to our shareholders for consideration at the general shareholders’ meeting.
In addition, the head of each of our functional departments, the president of each of our 67 Table of Contents subsidiaries and the heads of each regional head office have entered into employment agreements with the Representative Director that provide for similar management targets to be achieved by each of our departments, subsidiaries and regional head offices. Item 6.C.
In addition, the head of each of our functional departments, the president of each of our subsidiaries and the heads of each regional head office have entered into employment agreements with the Representative Director that provide for similar management targets to be achieved by each of our departments, subsidiaries and regional head offices. Item 6.C.
For details of our share-based payments, see Note 24 of the notes to the Consolidated Financial Statements. Item 6.F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable. 72 Table of Contents Item 7. Major Shareholders and Related Party Transactions
For details of our share-based payments, see Note 24 of the notes to the Consolidated Financial Statements. Item 6.F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable. Item 7. Major Shareholders and Related Party Transactions
Starting in April 2011, in accordance with the Korean Employee Retirement Income Security Act, we replaced such lump-sum severance payment system with our current pension insurance system in the form of a defined benefit plan, and also introduced a defined contribution plan in December 2012, with a total combined unfunded portion of approximately ￦ 149 billion as of December 31, 2023.
Starting in April 2011, in accordance with the Korean Employee Retirement Income Security Act, we replaced such lump-sum severance payment system with our current pension insurance system in the form of a defined benefit plan, and also introduced a defined contribution plan in December 2012, with a total combined unfunded portion of approximately ￦ 215 billion as of December 31, 2024.
Our employees, including executive officers as well as non-executive employees, are subject to a pension insurance system, under which we make monthly contributions to the pension accounts of the employees, and upon retirement, such employees are paid the pension amount due from their pension accounts.
Our employees, including executive officers as well as non-executive employees, are subject to a pension insurance system, under which we make 78 Table of Contents monthly contributions to the pension accounts of the employees, and upon retirement, such employees are paid the pension amount due from their pension accounts.
Board Practices As of April 1, 2024, none of our inside or outside directors maintained directors’ service contracts with us or with any of our subsidiaries providing for benefits upon termination of employment. Corporate Governance Committee The Corporate Governance Committee is comprised of four outside directors (YangHee Choi, Woo-Young Kwak, Seung Hoon Lee and Seongcheol Kim).
Board Practices As of April 15, 2025, none of our inside or outside directors maintained directors’ service contracts with us or with any of our subsidiaries providing for benefits upon termination of employment. Corporate Governance Committee The Corporate Governance Committee is comprised of four outside directors (YangHee Choi, Woo-Young Kwak, Seung Hoon Lee and Seongcheol Kim).
The committee’s duties include reviews of sustainable 68 Table of Contents management plans, the authorization of establishment of medium-and long-term sustainable management strategies, sustainable management results, regular reporting and risk management of sustainable management activities and charitable contributions. The committee members are elected by the board after the annual meeting.
The committee’s duties include reviews of sustainable management plans, the authorization of establishment of medium- and long-term sustainable management strategies, sustainable management results, regular reporting and risk management of sustainable management activities and charitable contributions. The committee members are elected by the board after the annual meeting.
Employee Stock Ownership and Benefits We operate an employee stock ownership plan (the “ESOP”) with the purpose of enabling our employees to build financial assets, enhancing corporate productivity, and fostering cooperative labor-management relations. Through the ESOP, our employee stock ownership association owned 3.95% of our issued shares as of December 31, 2023.
Employee Stock Ownership and Benefits We operate an employee stock ownership plan (the “ESOP”) with the purpose of enabling our employees to build financial assets, enhancing corporate productivity, and fostering cooperative labor-management relations. Through the ESOP, our employee stock ownership association owned 3.20% of our issued shares as of December 31, 2024.
Audit Committee members must also meet the applicable independence criteria set forth under the rules and regulations of the Sarbanes-Oxley Act of 2002. The committee is comprised of Yeong Kyun Ahn, Yong-Hun Kim, Seong Hoon Lee and Seung Ah Theresa Cho. The chairperson is Yeong Kyun Ahn. Yeong Kyun Ahn serves as the financial expert of the Audit Committee.
Audit Committee members must also meet the applicable independence criteria set forth under the rules and regulations of the Sarbanes-Oxley Act of 2002. The committee is comprised of Yeong Kyun Ahn, Yong-Hun Kim, Seong Hoon Lee, Seung Ah Theresa Cho and Seongcheol Kim. The chairperson is Yeong Kyun Ahn.
Employees On a standalone basis, we had 19,737 employees as of December 31, 2023, compared to 20,544 employees as of December 31, 2022 and 21,759 employees as of December 31, 2021. Labor Relations We consider our current relations with our work force to be good.
Employees On a standalone basis, we had 16,927 employees as of December 31, 2024, compared to 19,737 employees as of December 31, 2023 and 20,544 employees as of December 31, 2022. Labor Relations We consider our current relations with our work force to be good.
However, in the past, we have experienced opposition from our labor union for our strategy of restructuring to improve our efficiency and profitability by disposing of non-core businesses and reducing our employee base. 69 Table of Contents As of December 31, 2023, approximately 78.1% of the employees of KT Corporation were members of labor unions.
However, in the past, we have experienced opposition from our labor union for our strategy of restructuring to improve our efficiency and profitability by disposing of non-core businesses and reducing our employee base. As of December 31, 2024, approximately 76.7% of the employees of KT Corporation were members of labor unions.
The chairperson of the board of directors is elected from among the outside directors by a resolution of the board of directors. The term of office of the chairperson is one year.
The chairperson of the board of directors is elected from among the outside directors by a resolution of the board of directors.
Under our articles of incorporation, the board of directors must submit a draft management contract between KT Corporation and the candidate covering our management objectives to the shareholders’ meeting at the time of candidate nomination to the meeting. When the draft management contract has been approved at the shareholders’ meeting, we enter into such management contract with the Representative Director.
Under our articles of incorporation, the board of directors must submit a draft management contract between KT Corporation and the Representative Director candidate covering our management objectives to the shareholders’ meeting at the time of candidate nomination to the meeting.
In such case, the chairperson of the board of directors, on our behalf, signs the management contract. In March 2020, our articles of incorporation were amended to have management goals be set based on objectives that can be accomplished during a Representative Director’s term in office.
In March 2020, our articles of incorporation were amended to have management goals be set based on objectives that can be accomplished during a Representative Director’s term in office.
We also operate a Cyber Academy to provide online classes to our employees, as well as offer various foreign language classes to our employees. In addition, we provide tuition reimbursements to select employees who pursue graduate programs in Korea, as well as provide financial assistance to those who pursue work-related professional licenses or study foreign languages. Item 6.E.
In addition, we provide tuition reimbursements to select employees who pursue graduate programs in Korea, as well as provide financial assistance to those who pursue work-related professional licenses or study foreign languages. Item 6.E.
Share Ownership Ordinary Shares The persons who currently serve as our directors or executive officers held, as a group, 293,574 common shares as of April 5, 2024.
Share Ownership Ordinary Shares The persons who currently serve as our directors or executive officers held, as a group, 223,780 common shares as of April 3, 2025.
Director Candidate Recommendation Committee The Director Candidate Recommendation Committee is comprised of all of our outside directors. The chairperson is Jong Soo Yoon.
Director Candidate Recommendation Committee The Director Candidate Recommendation Committee is comprised of all of our outside directors. The chairperson is Seongcheol Kim.
Members of the committee are elected by our shareholders at the shareholders’ meeting. Our internal and external auditors report directly to the committee.
Yeong Kyun Ahn serves as the financial expert of the Audit Committee. Members of the committee are elected by our shareholders at the shareholders’ meeting. Our internal and external auditors report directly to the committee.
Our current directors are as follows: Name Position Director Since Date of Birth Expiration of Term of Office Inside Directors (1) Young Shub Kim Representative Director and Chief Executive Officer August 2023 April 10, 1959 March 2026 Chang-Seok Seo Senior Executive Vice President, Network Group August 2023 July 5, 1967 March 2026 Outside Directors (1) Jong Soo Yoon Senior Advisor, Kim & Chang June 2023 August 13, 1958 March 2026 Yong-Hun Kim Partner, DR & AJU LLC March 2022 March 29, 1955 March 2025 YangHee Choi President, Hallym University June 2023 July 27, 1955 March 2026 Woo-Young Kwak Former Chairman of Steering Committee, Vehicle IT Fusion and Innovation Center, Ministry of Science and ICT June 2023 September 3, 1956 March 2025 Yeong Kyun Ahn Board member of IFAC June 2023 February 6, 1959 March 2026 Seung Hoon Lee Partner of KCGI Co., Ltd.
The term of office of the chairperson is one year. 72 Table of Contents Our current directors are as follows: Name Position Director Since Date of Birth Expiration of Term of Office Inside Directors (1) Young Shub Kim Representative Director and Chief Executive Officer August 2023 April 10, 1959 March 2026 Chang-Seok Seo Senior Executive Vice President, Network Group August 2023 July 5, 1967 March 2026 Outside Directors (1) Seongcheol Kim Professor, School of Media and Communication, Korea University June 2023 June 12, 1964 March 2028 Yong-Hun Kim Partner, DR & AJU LLC March 2022 March 29, 1955 March 2028 YangHee Choi President, Hallym University June 2023 July 27, 1955 March 2026 Woo-Young Kwak Former Chairman of Steering Committee, Vehicle IT Fusion and Innovation Center, Ministry of Science and ICT June 2023 September 3, 1956 March 2028 Jong Soo Yoon Senior Advisor, Kim & Chang June 2023 August 13, 1958 March 2026 Yeong Kyun Ahn Board member of IFAC June 2023 February 6, 1959 March 2026 Seung Hoon Lee Member of the Steering Committee—Korea Investment Corporation June 2023 December 25, 1962 March 2028 Seung Ah Theresa Cho Professor, Strategic Management and International Business, Seoul National University Business School June 2023 October 22, 1967 March 2026 (1) All of our inside and outside directors beneficially own less than one percent of the issued shares of KT Corporation in the aggregate.
Under our articles of incorporation, the term of office for a director is up to three years.
Under our articles of incorporation, the term of office for a director is up to three years. The term of office for an outside director may be up to six years, pursuant to the Commercial Code of Korea. The term of office for our outside directors is currently three years.
Innovation Group 1970 Young-Bok Lee Senior Executive Vice President, Legal Affairs Office 1961 Hyeon-Seuk Lee Senior Executive Vice President, Customer Business Group 1966 Hyun-Kyu Lim Senior Executive Vice President, Corporate Management Group 1964 Choong-Rim Ko Executive Vice President, Group Human Resources Office 1967 Kwang-Dong Kim Executive Vice President, Corporate Relations Office 1970 Bong-Gyun Kim Executive Vice President, Busan/Gyeongnam Regional Headquarter 1972 Young-In Kim Executive Vice President, Western Seoul Regional Headquarter 1968 Young-Ho Kim Executive Vice President, Southern Seoul Regional Headquarter 1966 Chae-Hee Kim Executive Vice President, On External Training 1974 Hoon-Bae Kim Executive Vice President, Media Business Unit 1963 Hye-Byung Min Executive Vice President, Enterprise Business Strategy Unit 1969 Hyo-Il Park Executive Vice President, Strategy Office 1970 Jeong-Hyun Seo Executive Vice President, Legal Consulting Department 1971 Jin-Ho Yang Executive Vice President, Litigation Management Department 1973 Kyung-Hwa Ok Executive Vice President, IT Platform Unit 1968 Chang-Ho Yi Executive Vice President, Chungnam/Chungbuk Regional Headquarter 1972 Min Jang Executive Vice President, Financial Management Office 1968 65 Table of Contents Name Title and Responsibility Year of Birth Woo-Jin Jung Executive Vice President, KT Consulting Group 1975 Hoon Cho Executive Vice President, SCM Strategy Office 1966 Jung-Yong Ji Executive Vice President, Jeonnam/Jeonbuk Regional Headquarter 1968 Si-Hwan Choi Executive Vice President, Daegu/Gyeongbuk Regional Headquarter 1967 Chan-Ki Choi Executive Vice President, Northern Seoul/Gangwon Regional Headquarter 1966 Eui-Jeung Choo Executive Vice President, Audit Office 1976 Seong-Kwon Kang Senior Vice President, Cloud/Platform Lead 1971 Lee-Hwan Kang Senior Vice President, Micro Enterprise Business Unit 1970 Gang-Bon Koo Senior Vice President, Western Seoul Customer Sales Headquarter 1972 Jae-Hyung Koo Senior Vice President, Network Technology Unit 1972 Hye-Jin Kwon Senior Vice President, Network Strategy Unit 1971 Hee-Keun Kwon Senior Vice President, Sales Operating Business Unit 1970 Mong-Ryong Kim Senior Vice President, Finance Customer Business Unit 1971 Byung-Kyun Kim Senior Vice President, Device Business Unit 1968 Young-Geol Kim Senior Vice President, Customer Business Unit 1973 Young-Min Kim Senior Vice President, Modern IT Lead 1971 Yong-Nam Kim Senior Vice President, Jeonnam/Jeonbuk Enterprise Customer Sales Headquarter 1969 Jae-Kwon Kim Senior Vice President, DX Business Unit 1968 Jun-Ho Kim Senior Vice President, Public Customer Business Unit 1965 Jee-Hyeon Kim Senior Vice President, Partnership & Investment Department 1969 Jin-Chul Kim Senior Vice President, Jeonnam/Jeonbuk Customer Sales Headquarter 1967 Hoon-Dong Kim Senior Vice President, AI/Data Lead 1976 Hyeong-Rae Roh Senior Vice President, Strategic Customer Business Unit 1970 Je-Hoon Myung Senior Vice President, Enterprise Telecommunications Business Unit 1972 Sang-Ryong Moon Senior Vice President, Information Security Unit 1967 Jung-Ho Park Senior Vice President, EduDX Business Unit 1970 Soon-Min Bae Senior Vice President, AI2X Lab 1980 Ki-Hong Seo Senior Vice President, Daegu/Gyeongbuk Enterprise Customer Sales Headquarter 1967 Won-Je Sung Senior Vice President, Southern Seoul Enterprise Customer Sales Headquarter 1972 Je-Hyun Sung Senior Vice President, Northern Seoul/Gangwon Enterprise Customer Sales Headquarter 1972 Hoon-Joo Shin Senior Vice President, On External Training 1971 Tae-Sung Oh Senior Vice President, ESG Management & Implementation Unit 1968 Taek-Gyun Oh Senior Vice President, Network O&M Unit 1968 Yong-Kyu Yoo Senior Vice President, Strategy & New Business Planning Unit 1971 Kyung-A Yoon Senior Vice President, AI Tech Lab 1973 Byoung-Hyu Yoon Senior Vice President, Chungnam/Chungbuk Customer Sales Headquarter 1972 Jin-Hyoun Youn Senior Vice President, Media R&D Department 1968 Tae-Sik Yoon Senior Vice President, Brand Communication Department 1969 Mi-Hee Lee Senior Vice President, Strategy & New Business Consulting & Implementation Unit 1970 Byeong-Moo Lee Senior Vice President, Customer Experience Innovation Unit 1971 Sang-Ki Lee Senior Vice President, Global Business Development Department 1970 Sang-Ho Lee Senior Vice President, Robot Platform Business Department 1975 Sung-Kyu Lee Senior Vice President, Northern Seoul/Gangwon Network O&M Headquarter 1969 Seong-Hwan Yi Senior Vice President, Western Seoul Enterprise Customer Sales Headquarter 1968 Se-Jung Lee Senior Vice President, AI Service Lab 1974 Young-Jun Lee Senior Vice President, Chungnam/Chungbuk Enterprise Customer Sales Headquarter 1968 Jung-Woo Lee Senior Vice President, Public Relations Office 1971 Jong-Sik Lee Senior Vice President, Network Laboratory 1972 Chan-Seung Lee Senior Vice President, Accounting Department 1968 Bo-Heon Im Senior Vice President, Busan/Gyeongnam Network O&M Headquarter 1967 Seung-Hyouk Yim Senior Vice President, Enterprise Business Consulting & Implementation Unit 1970 Du-Seong Chang Senior Vice President, Large AI Core Tech.
If the board of directors determines, based on the results of the performance review, that the new Representative Director has failed to achieve the management goals, it may propose to dismiss the Representative Director at a shareholders’ meeting. 73 Table of Contents Senior Management In addition to our inside directors who are also our executive officers, we have the following executive officers as of April 1, 2025: Name Title and Responsibility Year of Birth Chang-Yong Ahn Senior Executive Vice President, Enterprise Business Group 1966 Seung-Phil Oh Senior Executive Vice President, Tech Innovation Group 1970 Young-Bok Lee Senior Executive Vice President, Legal Affairs Office 1961 Hyeon-Seuk Lee Senior Executive Vice President, Customer Business Group 1966 Hyun-Kyu Lim Senior Executive Vice President, Corporate Management Group 1964 Choong-Rim Ko Executive Vice President, Group Human Resources Office 1967 Kwang-Dong Kim Executive Vice President, Corporate Relations Office 1970 Byung-Kyun Kim Executive Vice President, Daegu/Gyeongbuk Regional Headquarter 1968 Young-In Kim Executive Vice President, Western Seoul Regional Headquarter 1968 Young-Ho Kim Executive Vice President, Southern Seoul Regional Headquarter 1966 Won-Tae Kim Executive Vice President, Strategic Customer Business Unit 1969 Chae-Hee Kim Executive Vice President, Media Business Group 1974 Song-Yul Park Executive Vice President, Northern Seoul/Gangwon Regional Headquarter 1969 Hyo-Il Park Executive Vice President, Strategy Office 1970 Jeong-Hyun Seo Executive Vice President, Legal Consulting Group 1971 Jin-Ho Yang Executive Vice President, Litigation Consulting Group 1973 Kyung-Hwa Ok Executive Vice President, IT Ops Unit 1968 Yong-Kyu Yoo Executive Vice President, Public Customer Business Unit 1971 Won-Joon Lee Executive Vice President, Procurement Office 1967 Jong-Sik Lee Executive Vice President, Future Network Laboratory 1972 Chang-Ho Yi Executive Vice President, Chungnam/Chungbuk Regional Headquarter 1972 Min Jang Executive Vice President, Financial Management Office 1968 Woo-Jin Jung Executive Vice President, Strategy&Business Consulting Group 1975 Jae-Wook Jeong Executive Vice President, Busan/Gyeongnam Regional Headquarter 1972 Eui-Jeung Choo Executive Vice President, Audit Office 1976 Seong-Kwon Kang Senior Vice President, Cloud Lead 1971 Lee-Hwan Kang Senior Vice President, Micro Enterprise Business Unit 1970 Jae-Hyung Koo Senior Vice President, Network Technology Unit 1972 Hye-Jin Kwon Senior Vice President, Network Strategy Unit 1971 Hee-Keun Kwon Senior Vice President, Marketing Innovation Business Unit 1970 Mong-Ryong Kim Senior Vice President, Western Seoul Enterprise Customer Sales Headquarter 1971 Young-Geol Kim Senior Vice President, Service Product Unit 1973 Young-Min Kim Senior Vice President, IT Dev Unit 1971 Yong-Nam Kim Senior Vice President, Jeonnam/Jeonbuk Enterprise Customer Sales Headquarter 1969 You-Tae Kim Senior Vice President, Corporate Strategy Department 1972 Jee-Hyeon Kim Senior Vice President, Partnership & Investment Department 1969 Jin-Chul Kim Senior Vice President, Jeonnam/Jeonbuk Regional Headquarter 1967 Hoon-Dong Kim Senior Vice President, AI Lead 1976 Hyeong-Rae Roh Senior Vice President, Busan/Gyeongnam Enterprise Customer Sales Headquarter 1970 Je-Hoon Myung Senior Vice President, Service Product Unit 1972 Min-Woo Bahk Senior Vice President, Modern IT Lead 1971 Chul-Woo Park Senior Vice President, Finance Customer Business Unit 1975 Cheal-Ho Park Senior Vice President, Corporate Relations Office Communication Policy Department 1972 Soon-Min Bae Senior Vice President, AI Future Lab 1980 Won-Je Sung Senior Vice President, Southern Seoul Enterprise Customer Sales Headquarter 1972 Je-Hyun Sung Senior Vice President, Northern Seoul/Gangwon Enterprise Customer Sales Headquarter 1972 Jeung-Yeup Son Senior Vice President, Device Business Unit 1972 Seung-Ho Song Senior Vice President, SPA Unit 1974 Young-Tae Song Senior Vice President, Chungnam/Chungbuk Enterprise Customer Sales Headquarter 1967 Chang-Seog Song Senior Vice President, Safety&Health Office 1970 Dong-Hoon Shin Senior Vice President, Gen AI Lab 1976 74 Table of Contents Name Title and Responsibility Year of Birth Young-Woon Shin Senior Vice President, Group Human Resources Department 1971 Jong-Su Shin Senior Vice President, Media Strategy Unit 1977 Sung-Min Oh Senior Vice President, Sales Operating & Channel Business Unit 1972 Tae-Sung Oh Senior Vice President, ESG Management & Implementation Office 1968 Taek-Gyun Oh Senior Vice President, Network O&M Innovation Unit 1968 Jung-Han Woo Senior Vice President, TMO Unit 1974 Man-Ho Won Senior Vice President, Experience Engineering Unit 1974 Seo-Bong Yu Senior Vice President, AX Business Unit 1975 Kyung-A Yoon Senior Vice President, Agentic AI Lab 1973 Byoung-Hyu Yoon Senior Vice President, Chungnam/Chungbuk Customer Sales Headquarter 1972 Sang-Woong Yoon Senior Vice President, Corporate Relations Office AX Policy Department 1977 Young-Kyoon Yun Senior Vice President, IR Department 1971 Jin-Hyoun Youn Senior Vice President, Platform Technology Unit 1968 Tae-Sik Yoon Senior Vice President, Brand Strategy Office 1969 Kyong-Chae Yi Senior Vice President, Western Seoul Customer Sales Headquarter 1971 Byeong-Moo Lee Senior Vice President, AX Innovation Support Department 1971 Sang-Ki Lee Senior Vice President, Global Cooperation Department 1970 Sung-Kyu Lee Senior Vice President, Northern Seoul/Gangwon Network O&M Headquarter 1969 Se-Jung Lee Senior Vice President, Decision Intelligence Lab 1974 Jeong-Soo Lee Senior Vice President, CEO Support Office 1972 Jung-Woo Lee Senior Vice President, Public Relations Office 1971 Jin-Kwon Yi Senior Vice President, Enterprise Business Implementation Unit 1 1969 Bo-Heon Im Senior Vice President, Busan/Gyeongnam Network O&M Headquarter 1967 Hye-Jin Lim Senior Vice President, Legal Consulting Group Legal Consulting Department 1978 Byung-Gwan Jang Senior Vice President, Win-Win Cooperation Unit 1970 Seung-Rok Jeon Senior Vice President, GTM Unit 1977 Kil-Sung Jung Senior Vice President, Strategy-Planning Department 1974 Seon-Il Jeong Senior Vice President, Jeonnam/Jeonbuk Network O&M Headquarter 1968 Chan-Ho Jung Senior Vice President, Human Resources Development Department 1968 Young-Geun Ji Senior Vice President, Southern Seoul Network O&M Headquarter 1972 Young-Sim Jin Senior Vice President, Education Business Cooperation Department 1972 Kwang-Chul Choi Senior Vice President, IPTV Business Unit 1971 Dong-Ryul Choi Senior Vice President, Daegu/Gyeongbuk Enterprise Customer Sales Headquarter 1971 Yung Choi Senior Vice President, Financial Planning Department 1971 Woo-Hyung Choi Senior Vice President, Network Core Service Unit 1970 Ho-Chang Choi Senior Vice President, On External Training 1971 Soo-Kyung Han Senior Vice President, Corporate Synergy Department 1977 Tae-Won Hur Senior Vice President, Compliance Office 1970 Tae-Jun Heo Senior Vice President, Enterprise Business Unit 1970 Hae-Chon Hong Senior Vice President, Enterprise Business Implementation Unit 2 1972 Kyeng-Hee Hwang Senior Vice President, Daegu/Gyeongbuk Network O&M Headquarter 1970 Item 6.B.
Item 6.A. Directors and Senior Management Directors Our board of directors has the ultimate responsibility for the administration of our affairs.
Item 6.A. Directors and Senior Management Directors Our board of directors has the ultimate responsibility for the administration of our affairs. Our articles of incorporation provide for a board of directors consisting of: • up to two inside directors, including the Representative Director; and • up to eight outside directors.
The table below shows the ownership of our ordinary shares by our directors and executive officers as of April 1, 2024: Shareholders Number of Common Shares Owned Young Shub Kim 5,300 Chang-Seok Seo 15,511 Soo-Jung Shin 14,592 Chang-Yong Ahn 8,815 Hyeon-Seuk Lee 11,659 Choong-Rim Ko 2,446 Kwang-Dong Kim 866 Bong-Gyun Kim 9,196 Young-In Kim 6,798 Young-Ho Kim 8,254 Chae-Hee Kim 9,359 Hoon-Bae Kim 6,459 Hye-Byung Min 7,654 Hyo-Il Park 8,393 Jeong-Hyun Seo 1,452 Jin-Ho Yang 5,071 Kyung-Hwa Ok 9,915 Chang-Ho Yi 9,292 Min Jang 745 Hoon Cho 1,258 Jung-Yong Ji 11,724 Si-Hwan Choi 4,649 Chan-Ki Choi 11,592 Lee-Hwan Kang 36 Gang-Bon Koo 5,249 Jae-Hyung Koo 1,419 Hye-Jin Kwon 3,742 Hee-Keun Kwon 1,075 Mong-Ryong Kim 36 Byung-Kyun Kim 6,317 Young-Geol Kim 735 Yong-Nam Kim 86 Jae-Kwon Kim 7,992 Jun-Ho Kim 4,582 Jee-Hyeon Kim 586 Jin-Chul Kim 986 Hyeong-Rae Roh 262 Je-Hoon Myung 2,125 Sang-Ryong Moon 1,360 71 Table of Contents Shareholders Number of Common Shares Owned Jung-Ho Park 1,166 Soon-Min Bae 7,474 Ki-Hong Seo 1,023 Won-Je Sung 1,397 Je-Hyun Sung 647 Hoon-Joo Shin 3,211 Tae-Sung Oh 45 Yong-Kyu Yoo 8,031 Byoung-Hyu Yoon 157 Jin-Hyoun Youn 1,418 Mi-Hee Lee 6,131 Byeong-Moo Lee 169 Sang-Ho Lee 932 Seong-Hwan Yi 2,865 Sung-Kyu Lee 147 Young-Jun Lee 1,405 Jung-Woo Lee 265 Jong-Sik Lee 6,676 Bo-Heon Im 1,013 Seung-Hyouk Yim 5,642 Du-Seong Chang 831 Kil-Sung Jung 1,415 Seon-Il Jeong 307 Jae-Wook Jeong 9,632 Seong-Eun Cho 4,480 Young-Sim Jin 3,306 Kang-Rim Choi 6,825 Woo-Hyung Choi 147 Joon-Ki Choi 4,296 Ho-Chang Choi 3,128 Tae-Jun Heo 1,405 Hae-Chon Hong 147 Kyeng-Hee Hwang 253 Total 293,574 Share-based Payments We have granted share-based payments to our chief executive officer, inside directors, outside directors and executive officers.
The table below shows the ownership of our ordinary shares by our directors and executive officers as of April 3, 2025: Shareholders Number of Common Shares Owned Young Shub Kim 7,282 Chang-Seok Seo 17,826 Seongcheol Kim 357 Yong-Hun Kim 811 YangHee Choi 357 Woo-Young Kwak 357 Jong Soo Yoon 357 Yeong Kyun Ahn 357 Seung Hoon Lee 357 Seung Ah Theresa Cho 357 Chang-Yong Ahn 10,272 Hyeon-Seuk Lee 13,902 Choong-Rim Ko 2,446 Kwang-Dong Kim 2,323 Byung-Kyun Kim 8,560 Young-In Kim 8,255 Young-Ho Kim 8,254 Chae-Hee Kim 10,816 Song-Yul Park 1,003 79 Table of Contents Shareholders Number of Common Shares Owned Hyo-Il Park 10,636 Jeong-Hyun Seo 2,909 Jin-Ho Yang 6,132 Kyung-Hwa Ok 11,372 Yong-Kyu Yoo 10,274 Won-Joon Lee 2,983 Jong-Sik Lee 8,919 Chang-Ho Yi 10,749 Min Jang 745 Jae-Wook Jeong 10,693 Eui-Jeung Choo 200 Jae-Hyung Koo 2,876 Hye-Jin Kwon 5,985 Hee-Keun Kwon 2,136 Mong-Ryong Kim 36 Young-Geol Kim 735 Yong-Nam Kim 786 Jee-Hyeon Kim 586 Jin-Chul Kim 2,443 Hyeong-Rae Roh 262 Je-Hoon Myung 2,601 Cheal-Ho Park 147 Soon-Min Bae 8,785 Won-Je Sung 2,854 Je-Hyun Sung 647 Jeung-Yeup Son 208 Young-Tae Song 939 Chang-Seog Song 281 Sung-Min Oh 302 Tae-Sung Oh 1,018 Byoung-Hyu Yoon 157 Jin-Hyoun Youn 1,784 Kyong-Chae Yi 111 Byeong-Moo Lee 169 Sung-Kyu Lee 147 Jeong-Soo Lee 153 Jung-Woo Lee 265 Jin-Kwon Yi 147 Bo-Heon Im 1,013 Hye-Jin Lim 451 Kil-Sung Jung 2,872 Seon-Il Jeong 307 Chan-Ho Jung 158 Young-Sim Jin 4,763 Kwang-Chul Choi 183 Dong-Ryul Choi 81 Yung Choi 1,547 Woo-Hyung Choi 147 Ho-Chang Choi 3,128 Soo-Kyung Han 257 Tae-Jun Heo 2,052 Hae-Chon Hong 147 Kyeng-Hee Hwang 253 Total 223,780 80 Table of Contents Share-based Payments We have granted share-based payments to our chief executive officer, inside directors, outside directors and executive officers.
Our articles of incorporation provide for a board of directors consisting of: • up to two inside directors, including the Representative Director; and • up to eight outside directors. 63 Table of Contents All of our directors are elected at the general shareholders’ meeting.
All of our directors are elected at the general shareholders’ meeting.
Removed
Pursuant to an amendment to our articles of incorporation in March 2020, the term of office for an outside director changed from up to ten years to up to six years, which change was made to reflect an amendment to the enforcement decree of the Commercial Code of Korea.
Added
When the draft management contract has been approved at the shareholders’ meeting, we enter into such management contract with the Representative Director. In such case, the chairperson of the board of directors, on our behalf, signs the management contract.
Removed
June 2023 December 25, 1962 March 2025 Seongcheol Kim Professor, School of Media and Communication, Korea University June 2023 June 12, 1964 March 2025 Seung Ah Theresa Cho Professor, Strategic Management and International Business, Seoul National University Business School June 2023 October 22, 1967 March 2026 64 Table of Contents (1) All of our inside and outside directors beneficially own less than one percent of the issued shares of KT Corporation in the aggregate.
Added
Compensation Compensation of Directors and Executive Officers In 2024, the aggregate compensation paid to and accrued for all directors and executive officers was approximately ￦ 43.3 billion and the aggregate amount set aside or accrued by us to provide pension and retirement benefits to such persons was approximately ￦ 4.3 billion. 75 Table of Contents The compensation of our directors and executive officers in 2024 that was disclosed on an individual basis in Korea was as follows: Name Position Total Compensation in 2024 Composition of Total Compensation (In millions of Won) Young-Shub Kim Chief Executive Officer ￦ 901 ￦ 556 (salary); ￦ 332 (bonus); ￦ 13 (benefits) Chang-Seok Seo Inside Director ￦ 750 ￦ 392 (salary); ￦ 339 (bonus); ￦ 19 (benefits) Hyeon-Seuk Lee Senior Executive Vice President ￦ 683 ￦ 355 (salary); ￦ 302 (bonus); ￦ 26 (benefits) Soo-Jung Shin Former Senior Executive Vice President ￦ 1,677 ￦ 408 (salary); ￦ 224 (bonus); ￦ 22 (benefits); ￦ 1,023 (severance pay) Hoon-Bae Kim Former Executive Vice President ￦ 949 ￦ 230 (salary); ￦ 177 (bonus); ￦ 22 (benefits); ￦ 520 (severance pay) The chairperson of our board of directors enters into an employment agreement on our behalf with our Representative Director.
Removed
If the board of directors determines, based on the results of the performance review, that the new Representative Director has failed to achieve the management goals, it may propose to dismiss Representative Director at a shareholders’ meeting.
Added
Operating Results.” Employee Training The objective of our training program is to develop professionals who can create value for our customers by leveraging core digital transformation technologies such as telecommunications, AI, big data and cloud computing.
Removed
Senior Management In addition to our inside directors who are also our executive officers, we have the following executive officers as of April 1, 2024: Name Title and Responsibility Year of Birth Soo-Jung Shin Senior Executive Vice President, Strategy & New Business Group 1965 Chang-Yong Ahn Senior Executive Vice President, Enterprise Business Group 1966 Seung-Phil Oh Senior Executive Vice President, Tech.
Added
To support the development of our employees, we provide individually tailored curricula based on competency assessments, who complete an average of approximately 77 hours of training per year. We also operate a Cyber Academy to provide online classes to our employees, as well as offer various foreign language classes to our employees.
Removed
Department 1969 Byung-Gwan Jang Senior Vice President, Win-Win Cooperation Department 1970 Kil-Sung Jung Senior Vice President, Corporate Strategy Department 1974 Seon-Il Jeong Senior Vice President, Southern Seoul Network O&M Headquarter 1968 Jae-Wook Jeong Senior Vice President, Busan/Gyeongnam Customer Sales Headquarter 1972 Seong-Eun Cho Senior Vice President, SW Development Unit 1971 Young-Sim Jin Senior Vice President, Human Resources Development Department 1972 66 Table of Contents Name Title and Responsibility Year of Birth Kang-Rim Choi Senior Vice President, Mobility Business Unit 1974 Woo-Hyung Choi Senior Vice President, Core Network O&M Unit 1970 Joon-Ki Choi Senior Vice President, AI Business Unit 1974 Ho-Chang Choi Senior Vice President, Group Human Resources Department 1971 Tae-Won Hur Senior Vice President, Compliance Office 1970 Tae-Jun Heo Senior Vice President, Enterprise Sales Unit 1970 Hae-Chon Hong Senior Vice President, Service Tech Lab 1972 Kyeng-Hee Hwang Senior Vice President, Daegu/Gyeongbuk Network O&M Headquarter 1970 Item 6.B.
Removed
Compensation Compensation of Directors and Executive Officers In 2023, the aggregate compensation paid and accrued to all directors and executive officers was approximately ￦ 73.8 billion and the aggregate amount set aside or accrued by us to provide pension and retirement benefits to such persons was approximately ￦ 3.8 billion.
Removed
The compensation of our directors and executive officers in 2023 that was disclosed on an individual basis in Korea was as follows: Name Position Total Compensation in 2023 Composition of Total Compensation (In millions of Won) Hyeon-Mo Ku Former Chief Executive Officer ￦ 3,073 ￦ 335 (salary); ￦ 778 (bonus); ￦ 25 (benefits); ￦ 1,935 (severance pay) Kook-Hyun Kang Former President ￦ 2,571 ￦ 364 (salary); ￦ 579 (bonus); ￦ 62 (benefits); ￦ 1,566 (severance pay) Jong-Ook Park Former President ￦ 2,134 ￦ 381 (salary); ￦ 578 (bonus); ￦ 61 (benefits); ￦ 1,113 (severance pay) Byung-Sam Park Former Senior Executive Vice President ￦ 1,726 ￦ 347 (salary); ￦ 471 (bonus); ￦ 59 (benefits); ￦ 849 (severance pay) Hyun-Yok Sheen Former Senior Executive Vice President ￦ 1,701 ￦ 327 (salary); ￦ 398 (bonus); ￦ 68 (benefits); ￦ 908 (severance pay) Chang-Seok Seo Inside Director ￦ 864 ￦ 342 (salary); ￦ 466 (bonus); ￦ 56 (benefits) Kyoung-Lim Yun Former Inside Director ￦ 812 ￦ 111 (salary); ￦ 511 (bonus); W12 (benefits); ￦ 178 (severance pay) The chairperson of our board of directors enters into an employment agreement on our behalf with our Representative Director.
Removed
Operating Results.” 70 Table of Contents Employee Training The objective of our training program is to develop professionals who are able to create value for our customers. In order to develop skills of our employees, we require approximately 69 hours of training per year from most of our employees, using individually-tailored curriculums based on individual assessments.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

1 edited+0 added−0 removed1 unchanged
Major Shareholders The following table sets forth certain information relating to the shareholders of our ordinary shares as of December 31, 2023: Shareholders Number of Shares Percent of Total Shares Issued National Pension Corporation 20,843,859 8.08 % Shinhan Financial Group Co., Ltd 14,532,028 5.64 % Silchester International Investors LLP 13,084,358 5.07 % Hyundai Motor Company 12,251,234 4.75 % Employee stock ownership association 10,184,803 3.95 % Hyundai Mobis Co., Ltd. 8,094,466 3.14 % Director as a group 15,867 0.01 % Public 167,406,807 64.92 % KT Corporation (held in the form of treasury stock) 11,447,338 4.44 % Total issued shares 257,860,760 100.00 % Major shareholders of our ordinary shares do not have voting rights that are different from those of our public shareholders.
Major Shareholders The following table sets forth certain information relating to the shareholders of our ordinary shares as of December 31, 2024: Shareholders Number of Shares Percent of Total Shares Issued National Pension Service 19,572,583 7.77 % Shinhan Financial Group Co., Ltd 14,525,096 5.76 % Hyundai Motor Company 12,251,234 4.86 % Silchester International Investors LLP 12,154,357 4.82 % Hyundai Mobis Co., Ltd. 8,094,466 3.21 % Employee stock ownership association 8,057,639 3.20 % KT Corporation (held in the form of treasury stock) 6,188,739 2.46 % Director as a group 28,418 0.01 % Public 171,149,153 67.91 % Total issued shares 252,021,685 100.00 % Major shareholders of our ordinary shares do not have voting rights that are different from those of our public shareholders.

Other KT 10-K year-over-year comparisons