SK (034730) Q3 2024 earnings summary

Executive summary

• Combined results of major unlisted companies rose quarter-over-quarter, led by SK siltron and SK E & S, despite overall earnings decline due to weak energy and chemical markets.

• Operates as a holding company with diversified businesses in energy, chemicals, IT, semiconductors, bio, and real estate, managing over 660 subsidiaries as of Q3 2024.

• Corporate value-up plans announced, focusing on ROE improvement, operational efficiency, portfolio optimization, and debt reduction.

• Enhanced shareholder return plan introduced, including minimum annual DPS and share buybacks or extra dividends.

• Major business segments include SK Innovation, SK Telecom, SK Square, SK Networks, SKC, SK E&S, and SK Ecoplant.

Financial highlights

• Q3 2024 consolidated revenue: ₩94.5 trillion, down from ₩129.6 trillion YoY; operating profit: ₩2.76 trillion, down from ₩4.9 trillion YoY.

• Net income attributable to owners: ₩849.9 billion, compared to a loss of ₩776.8 billion YoY.

• Major unlisted subsidiaries' revenue up 11.1% QoQ and 7.4% YoY; EBITDA up 28.4% QoQ and 22.8% YoY.

• SK siltron revenue up 21.1% YoY, operating profit up 141.0% YoY; SK materials CIC revenue up 19.9% YoY.

• Total assets: ₩209.5 trillion; total equity: ₩81.8 trillion; total liabilities: ₩127.7 trillion.

Outlook and guidance

• 4Q profitability expected to improve for SK materials CIC and SK siltron, driven by higher customer utilization and expanded product portfolios.

• Focus on portfolio innovation, future growth in advanced materials, bio, AI/digital, and green businesses.

• Continued investment in battery, semiconductor, and green energy value chains.

• SK E & S aims to maintain robust earnings by leveraging the full LNG value chain and expects steady demand growth for city gas.

• Ongoing cost control, cash flow management, and capital efficiency emphasized.