SK Square (402340) Q3 2024 earnings summary

Executive summary

• Achieved record-high quarterly net income since launch, with 2024 1Q–3Q cumulative net income up KRW 3.0tn YoY to KRW 2.2tn, driven by improved performance of SK hynix and ICT affiliates.

• Consolidated revenue for the nine months ended September 30, 2024, was KRW 1,424.3bn, with a turnaround to net profit of KRW 2,191.3bn from a net loss of KRW 780.4bn in the prior year period.

• Operating profit reached KRW 2,260.6bn, reversing a loss of KRW 1,934.3bn YoY, driven by strong equity method gains and improved segment performance.

• Disclosed a prior notice for a Corporate Value-up Plan, scheduled for November 2024.

• ESG rating upgraded to 'A+' by KCGS, placing in the top 2% of Korean companies in 2024.

Financial highlights

• Consolidated operating income increased by KRW 1.7tn YoY to KRW 1.2tn; net income rose by KRW 0.7tn YoY to KRW 1.1tn.

• NAV as of 2024 3Q stood at KRW 31.9tn, with NAV per share at KRW 236,452.

• 2024 3Q revenue was KRW 457.5bn; total assets at KRW 20,127.2bn; shareholders' equity at KRW 17,999.7bn.

• Net profit attributable to controlling interests was KRW 2,222.0bn, compared to a net loss of KRW 766.0bn in the prior year.

• Basic EPS for the period was KRW 16,597, up from a loss of KRW 5,475 per share in the prior year.

Outlook and guidance

• Corporate Value-up Plan to be disclosed in November 2024, aiming to enhance shareholder value.

• E-commerce and platform businesses expect continued growth in mobile and digital services, with ongoing investments in AI, logistics, and customer experience.

• Semiconductor segment (SK hynix) anticipates sustained demand for high-performance memory (HBM, DDR5) and AI-related products.

• Management maintains a shareholder return policy targeting at least 30% of recurring dividend income for distributions, via share buybacks or cash dividends.

• Continued focus on ESG improvements and transparent information disclosure.