Korea Electric Power (015760) H2 2024 earnings summary

Executive summary

• Cumulative consolidated operating profit for Q4 2024 was ₩8.3 trillion, with net income at ₩3.7 trillion, reflecting improved profitability year-over-year.

• Revenue rose 6.6% to ₩94 trillion, driven by a 7.2% increase in electricity sales to ₩88.9 trillion, while overseas and other revenue declined 2.9% to ₩5.1 trillion.

• Total assets reached KRW 246.6 trillion with KRW 94.0 trillion in revenue for 2024, maintaining a 100% market share in transmission and distribution and a dominant position in generation.

• Over 51% government ownership ensures strong policy support and financial backing, with credit ratings on par with the Korean sovereign (Aa2/AA).

• Operating profit turned positive in 2024, driven by higher electricity sales and lower fuel and power purchase costs.

Financial highlights

• Consolidated operating revenue for 2024 was KRW 94.0tn, up 6.6% year-over-year; operating profit reached KRW 8.3tn, a turnaround from previous losses.

• Net income rose to KRW 4.5tn, up 283.8% year-over-year.

• Cost of sales and SG&A fell 7.7% to ₩85.6 trillion, with fuel and purchased electricity costs down 16.5% and 9.5% respectively due to lower fuel prices.

• EBITDA margin improved to 19.9% in 2024, with an EBITDA interest coverage ratio of 3.2x.

• Interest expenses rose by ₩233.4 billion to ₩4.7 trillion, reflecting higher borrowing balances.

Outlook and guidance

• Electricity sales volume for Q4 2024 increased 0.7% to 550 TWh, with a slight decrease expected in 2025 due to lower economic growth and power market conditions.

• 2025 fuel cost guidance: coal at ~₩180,000/ton, LNG at ~₩1,050,000/ton, oil at ~₩1,100/liter, subject to global price fluctuations.

• Power generation mix for 2025 expected: nuclear early 90% utilization, coal mid-high 40%, LNG mid-high 20%.

• The company is committed to a net zero roadmap, targeting zero coal-based generation and group-wide zero Scope 3 emissions by 2050.

• Plans include significant capacity additions in nuclear, LNG, and renewables, with an average annual installation of 7GW of renewables by 2030.