Kepco turns profit for fourth consecutive quarter after hiking electricity bills

Korea Electric Power Corporation (Kepco) turned a profit in Q2, marking its fourth consecutive operating profit.

Oudoor units of air conditioners are stacked on the exterior of a building on Thursday amid heat wave that hit across the country. [NEWS1]

Korea Electric Power Corporation (Kepco) swung to profit in the second quarter of this year, reporting a net income of 114.4 billion won ($83.1 million) following a loss of 1.9 trillion won a year earlier, on the back of lower fuel costs and electricity bill hikes.

Operating profit for the April-June period was 1.25 trillion, compared with a loss of 2.27 trillion won a year ago, the company said Thursday in a regulatory filing. Sales rose 4.3 percent to 20.47 trillion won.

The earnings exceeded the average analyst estimate of 733.3 million won compiled by Yonhap Infomax, the financial data firm of Yonhap News Agency, and marked the fourth consecutive quarter in which Kepco reported operating profit on a consolidated basis.

Kepco saw its operating costs fall 17 percent on-year to 41.2 trillion won in the first half of 2024 due to stabilized global energy fees.

Specifically, the company spent 10.9 trillion won on resources and 17.1 trillion won on electricity from private power companies, representing decreases of 27.9 percent and 18.6 percent, respectively, over the period.

Kepco reported a cumulative loss of 43 trillion won from 2021 to 2023 as the company could not raise electricity prices enough to cover soaring fuel costs during the Covid-19 pandemic and periods of high inflation.

Accordingly, the company has been implementing various self-rescue measures, including the restructuring of overseas operations, property sales and voluntary retirement programs.

“Kepco intends to swiftly implement self-rescue measures and collaborate with the government on various initiatives to reduce costs and mitigate accumulated losses,” the company said in a statement.

Kepco added that it will proactively address the changing business environment in the face of the conflict in the Middle East and rising global energy prices.

Shares of Kepco closed at 19,190 won on the main bourse Thursday, down 1.54 percent from the previous day. The report was released after the market closed.

BY JIN EUN-SOO, YONHAP [jin.eunsoo@joongang.co.kr]