Korea Electric Power Corporation Q4 FY25 Earnings Analysis

- Electricity sales volume in Q3 2025 increased slightly by 0.4% year-over-year, driven mainly by summer heat wave. - For the full year 2025, KEPCO projects a slight decrease in electricity sales volume due to lower economic growth and downturn in the manufacturing sector. - Sales revenue in Q3 2025 was KRW 73,746.5 billion, up 5.5% year-over-year, with electricity sales revenue up 5.9%. - Other revenue, including overseas business income, declined slightly by 0.9%. - Future growth in electricity sales volume is expected to be modest or slightly declining in 2025 considering economic headwinds. - KEPCO anticipates maintaining a reasonable generation mix and stable capacity with increased nuclear generation offsetting coal decrease.

- KEPCO's consolidated operating profit for Q3 2025 was KRW 11,541.4 billion, with net profit at KRW 7,328.1 billion. - Electricity sales volume for Q3 2025 slightly increased by 0.4% year-over-year due to factors like the summer heat wave but is expected to decline slightly for the full year due to lower economic growth and a downturn in manufacturing. - Nuclear generation utilization is expected to be in the mid- to high 80% range for 2025, contributing to increased nuclear generation. - Coal generation is anticipated to decrease in 2025, while LNG generation is expected to maintain its mix. - Fuel cost reductions (e.g., coal prices down) and operating efficiencies have positively impacted profitability. - KEPCO is focusing on new overseas nuclear projects and grid upgrades to support future growth, though specific financial targets or EPS guidance were not disclosed in this call. - Dividend policy depends on annual net profit and government consultation, so shareholder returns remain uncertain.

- KEPCO is making investments to address transmission capacity constraints, specifically through the East Coast HVDC project, expected to complete its first phase by October 2026 and the second by December 2027, adding 4 gigawatts capacity per phase. - Additional investments are planned for grid expansion to support renewable energy integration and stable electricity supply for advanced industries. - The company anticipates raising tariffs to raise funds for these grid investments and to meet government greenhouse gas reduction targets. - KEPCO is also evaluating participation opportunities in the U.S. nuclear power market, considering risk factors and options. - Private sector involvement is expected to increase in the West Coast Energy Highway project, although details are still being finalized. - Overall, investments align with the 10th Basic Plan for Electricity Supply and Demand, with potential updates in the forthcoming 12th plan.

- KEPCO's borrowings as of Q3 2025 were KRW 130.5 trillion (consolidated) and KRW 86.1 trillion (separate basis). - Regarding rolling over short-term corporate bonds, KEPCO is closely monitoring interest rate volatility and working with government authorities to proactively manage any impacts. - No explicit mention of new debt or equity fundraising planned in the near term was made. - KEPCO is aware of potential needs for tariff increases to finance grid expansion and investment in renewable energy, which may influence future funding strategies. - No concrete plans for equity issuance or new fundraising were disclosed during the call.

- KEPCO is actively pursuing nuclear power plant orders in Asia, specifically in Vietnam. - The company has also participated in the bidding process for a nuclear power plant project in Saudi Arabia. - These bids are currently ongoing, and KEPCO has not disclosed further details. - In the U.S., KEPCO is exploring options to participate in the expanding nuclear power market, assessing risks and opportunities. - No specific information on confirmed new orders or finalized contracts beyond these bidding activities was provided.