KEPCO's Q2 loss widens on lower power rates

Korea Electric Power Corp. (KEPCO), South Korea's state-run power company, said Tuesday that its second-quarter net loss widened from a year earlier due mainly to lower electricity rates. Net loss came to 1.08 trillion won (US$1 billion) in the April-June period, compared with a loss of 835.6 billion won a year ago, the company said in a regulatory filing. Sales rose 10.6 percent on-year to 9.1 trillion won over the cited period, but its operating loss widened to 803.6 billion won from a 443.8 billion won shortfall a year earlier. KEPCO said that its first-half sales jumped 12 percent on-year to 19.9 trillion won, while its net loss reached 1.6 trillion won. KEPCO, the supplier of almost all of the country's electricity, had been forced to keep its power rates at lower levels than production costs as part of a government drive to curb rising inflation. The government allowed the utility firm to raise the rates by an average of 4.9 percent from this month, but the hike is not expected to improve its profit notably in the second quarter, experts said. Shares of KEPCO were trading at 21,500 won on the Seoul bourse as of 2:20 p.m., down 3.37 percent from the previous session.