KT Corporation

Good afternoon.

This is Choi Jae-gil, KT's IRO. We will begin the third quarter 2025 earnings presentation.

금일 발표하는 내용은 외부 감사인 검토 전 KIFRS 기준으로 작성된 추정 재무 실적과 영업 성과를 포함하고 있습니다. 확정된 과거 자료 이외의 모든 재무 성과와 경영 성과 자료에 대해서는

Please be reminded that today's presentation includes KIFRS-based financial estimates and operating results, which have not yet been reviewed by an outside auditor. We therefore cannot ensure accuracy nor completeness of financial and business data aside from the historical actuals. So please note that these figures may be subject to change in the future.

그럼 당사 장민 CFO의 인사 말씀과 함께 2025년 3분기 실적에 대한 설명이 있겠습니다.

With that said, let me now invite our CFO, 장민, to discuss KT's Q3 2025 earnings. 안녕하십니까? KT 재무실장 장민입니다.

먼저 2025년 3분기 실적 발표에 앞서서 불법 초소형 기지국을 통한 무단 소액 결제 피해와 Good afternoon, this is Changmin, KT's CFO.

Before going into the earnings for Q3 2025, I would like to extend my sincere apologies to our customers and investors for the unauthorized micropayments and infringement incident perpetrated through the illegal base station connections.

We are currently working on a comprehensive compensation plan for illegal damage payment customers and customers who have leaked personal information. From November 5, we are launching a safe and easy replacement for all customers. In the future, KT will prepare a technical and institutional supplementary plan to prevent customer protection.

KT is currently implementing a comprehensive plan to compensate customers affected by such unauthorized micropayments and personal information breach. Starting November 5th, KT is replacing USIM free of charge for all of its customers. Going forward, KT will do its utmost to put in place technical and system-based guardrails to protect customers and to ensure that such incidents are prevented through preemptive and far-reaching security measures.

On November 4, KT officially launched the representative doctor pre-employment process. The board of directors, which is made up of members of the board of directors, organized candidates through various routes, On November 4, we officially began the process for CEO nomination.

KT's Director Candidate Nomination Committee, comprising of all of the independent auditors, will select a pool of candidates from various different channels to recommend one candidate to the board of directors before the end of the year. BOD will then make the final confirmation, and the new CEO will be appointed at the general meeting of shareholders.

Now I will move on to KT's third quarter earnings for 2025.

Based on our telco business and continuing growth of Group's core portfolio, as well as real estate profit gained from Gwangjin District Development, KT sustained growth in revenue and operating profit this quarter.

We are also collaborating with global big tech companies to launch specific services and have secured a solid footing for AX business executions

by opening KT Innovation Hub, placing momentum behind the transformation towards an AICT company.

SOTA-K, which is a collaboration-based model with Microsoft, and Lama-K, which is an open-source model of Meta, have been released in an orderly manner and have shown the Korean AI LLM lineup in the market.

We released consecutively our proprietary model, MEDUM K2.0, SOTA-K, which is a model developed in collaboration with Microsoft, as well as LAMA-K, based on Meta's open-source technology technology. introducing AI LLM lineup catering to Korean requirements. Under the AI multimodal strategy, we will expand AI-driven usage base across various verticals, including media, press, education, public, and financial domains.

In October, we will hold an AX experience exhibition 산업별 맞춤형 컨설팅을 제공하는 KT Innovation Hub를 개소했습니다. 이곳에서 KT와 Microsoft 양사 AX 전문 인력이 협력하여 고객사와 함께 새로운 AX 사업 기회를 발굴할 계획입니다.

In October, we opened KT Innovation Hub under strategic partnership with Microsoft, where we can hold exhibitions on AX and AI experience and provide industry-specific consulting services. AI experts of both companies, together with our clients, will be working together in the hub to explore new AX business opportunities.

Third quarter dividend is 601 per share, as we maintained 20% higher dividend payout year-over-year, as was the case in Q1 and Q2.

Corporate value enhancement plan also is ongoing as planned. We had concrete results and securing capacity required for structural transformation into becoming an AICT company, with SOTA-K launch being one of such endeavors. We continue to work on streamlining assets and driving profitability enhancements through rationalizing low-margin businesses and liquidation of non-core assets.

We are working with SOTA-K As part of the value enhancement plan, we also completed 250 billion won share buyback on 13th of August. Next on financial performance for Q3 of 2025. Operating revenue was up 7.1% year-over-year, reporting 7,126.7 billion won.

And sustained growth from core businesses, including telecom, real estate, cloud, and data center, And profitability improvement efforts, as well as one-time real estate sales gains, operating profit was up 16% YOY, reporting 538.2 billion won. 순이익은 영업이익의 증가로 전년 동기 대비 16.2% 증가한 4,453억 원입니다.

에비타는 전년 동기 대비 5.2% 증가한 1조 5,039억 원입니다.

Net income was up 16.2% YOY, recording $445.3 billion, driven by increase in operating profit. EBITDA increased 5.2% YOY, reaching $1,503.9 billion won. Next page, I will walk through the operating expense items.

Operating expense increased 6.4% year-on-year to 6,588.6 billion won, an increase in cost of goods sold, cost of services, and selling expense.

Next is financial position of the company.

Net-to-equity ratio as end of September 2025 was 123.3%.

while net debt ratio went up 4.2 percentage points year-over-year, reaching 34.5%. Next, on CapEx.

KT와 주요 그룹사가 2025년 3분기 누적으로 집행한 투자 지출은 총 1조 9,637억 원입니다. KT 별도 기준으로는 1조 3,295억 원, 주요 핵심 그룹사는 6,342억 원을 집행했습니다. 지금부터는 사업별 실적에 대해 말씀드리겠습니다.

Total capex up to the third quarter of 25 of KT and its main subsidiaries accounted for 1,963,700,000,000 won. KT's separate basis capex was 1,329,500,000,000 while major subsidiaries spent 634,200,000,000 won. Next, performance breakdown by business.

The net profit is 8,096,000,000 won, which increased by 4% compared to the previous year.

Wireless revenue was up 4% year-on-year, reaching 1,809.6 billion won. 5G를 중심으로 가입자 기반이 확대되면서 매출 성장을 견인했습니다.

5G 보급률은 3분기말 기준으로 80.7%입니다. 다음은 유산 사업입니다.

Subscriber base expansion around 5G drove the top-line growth, with 5G penetration as of third quarter end reaching 80.7%.

Next is fixed-line business.

Internet revenue increased 2.3% year-on-year to 636.7 billion won on the back of Giga Internet subscriber growth and value-added services.

Media business increased IPTV subscribers Premium 요금제 판매 노력에 힘입어서 전년 동기 대비 3.1% 성장했습니다.

Backed by higher IPTV subscriber net addition and sale of premium plans, media business posted growth of 3.1% year-over-year.

Home 유선전화 수익은 전년 동기 대비 6.6% 감소한 1,609억 원입니다. 다음은 기업 서비스입니다.

Home telephony revenue fell 6.6% year-over-year to 160.9 billion won.

Next is B2B business.

B2B service revenue reported 0.7% year-over-year growth on the back of enterprise messaging, corporate broadband, and network-based business growth, despite streamlining of low-margin businesses.

AI IT business has continued to grow in terms of the number of customers and sales of AICC, but the sales of AICC decreased by 5.7% compared to the previous year due to the structural improvement of some businesses. Next is the performance of major group companies.

For the AI and IT business, revenue came down 5.7% year-over-year due to structural enhancement work done on certain businesses in line with our selective focus strategy, notwithstanding AICC project wins from large customers and ongoing monetization. Next is performance of major subsidiaries.

Contents as an original content production number decreased by 1.8% compared to the previous year. Revenue from content subsidiaries dipped 1.8% year-over-year due to less number of original title production.

KT cloud revenue was up 20.3% year-on-year following higher data center usage by global clients and AI cloud demand growth. KT estate revenue was up 23.9% year-on-year to $186.9 billion, backed by good performance from hotel business and new development projects.

I would like to apologize for the damage and dementia caused to the customers of the 3rd quarter of 2025. We, KT, will work hard to cooperate with government investigations, ensure network security, This ends the report on KT's third quarter earnings result.

Once again, I would like to extend my sincere apology for causing concern over unauthorized micropayments and the infringement incident. KT will cooperate with the government's investigation process and exert our utmost effort in ensuring network security and stronger customer protection.

Also, we will bring true AICT transformation, and by successfully implementing corporate value enhancement plan, we'll endeavor to drive stepwise upgrade in KT's corporate value. Thank you.

Once again, thank you to our investors and analysts for your continued interest and support.