Korea Electric Power (015760) Q3 2024 earnings summary

Executive summary

• Consolidated operating profit for Q3 2024 reached ₩5.9457 trillion, with net income at ₩2.59 trillion, marking a strong financial recovery.

• Sales rose 6.4% year-over-year to ₩69.8698 trillion, driven by an 8.0% increase in electricity sales.

• Korea's sole integrated electric utility holds 100% market share in transmission and distribution and a near-monopoly in power generation.

• Government ownership exceeds 51%, ensuring strategic support and policy alignment.

• Credit ratings remain on par with the Korean sovereign, reflecting high government support and essential public-policy role.

Financial highlights

• Income from electricity sales was ₩66.7279 trillion, up 8.0% YoY; other income fell 19.5% to ₩3.1419 trillion.

• Cost of sales and SG&A dropped 11.4% YoY to ₩63.9241 trillion, with fuel and power purchase costs down 18.6% and 11.6% respectively.

• Depreciation slightly decreased by 0.2% to ₩8.5348 trillion.

• Net income (consolidated) for Q3 2024 was ₩2.59 trillion, up 143.3% YoY.

• Operating profit margin rebounded to 8.3% in 2024 1H after negative margins in prior years.

Outlook and guidance

• Annual power sales expected to rise slightly, driven by increased heating and cooling demand.

• Profitability is expected to continue recovering in 2024, supported by lower fuel prices and power purchase costs.

• The company is accelerating its coal exit plan and expanding renewable and nuclear capacity to achieve net zero by 2050.

• No further tariff hikes anticipated in the near term following the October increase; financial impact of recent hikes and FX to be monitored.

• No official fuel cost outlook provided; fuel costs remain subject to global price trends.