Key Highlights

● Fiscal 2025 profit for the year was KRW 8.67 trillion, against KRW 3.62 trillion.

● First-half 2026 operating profit fell 16.6% to KRW 4.91 trillion.

● Fuel costs rose 8.8% to KRW 10.14 trillion in the first half.

● The company proposed a fiscal 2025 dividend of KRW 1,540 per ordinary share.

Korea Electric Power Corporation (NYSE:KEP), known as KEPCO, is South Korea's dominant electricity utility, and its American depositary shares trade on the New York Stock Exchange as KEP. Its 2025 annual report on Form 20-F says the Government beneficially owns a majority of the shares and warns that state interests may differ from those of other shareholders. Because KEPCO is a regulated, state-influenced utility, a broad equity benchmark such as the KOSPI is a loose comparison at best.

Reported results

For fiscal 2025, the company reported sales of KRW 97.43 trillion, up from KRW 93.40 trillion, operating profit of KRW 13.49 trillion against KRW 8.36 trillion, and profit for the year of KRW 8.67 trillion against KRW 3.62 trillion. Basic and diluted earnings per share were KRW 13,311. Operating cash flow was KRW 20.88 trillion, against KRW 15.88 trillion. Total assets were KRW 254.9 trillion and total equity KRW 49.3 trillion.

First-half 2026 figures, published on August 12 and preliminary, were less favorable. Consolidated revenue was KRW 46.32 trillion, up 0.3%, while operating profit fell 16.6% to KRW 4.91 trillion and net profit fell 21.0% to KRW 2.80 trillion. Fuel costs rose 8.8% to KRW 10.14 trillion, and the average coal price rose 24.3% to US$128.2 per tonne. Electricity sales volume slipped 0.6%, while power-purchase costs fell 0.9% to KRW 17.21 trillion. Borrowings were KRW 133.3 trillion and consolidated liabilities KRW 210.7 trillion at the end of June.

Tariffs, policy and management guidance

Tariff regulation is central. The 20-F explains that the fuel cost adjustment is capped at plus or minus KRW 5 per kilowatt-hour, that the Government can withhold adjustments, and that the usage charge has been held at KRW 5.0 per kilowatt-hour since the third quarter of 2022. Fuel accounted for 24.1% of cost of sales in 2025. Management said it plans to keep rates stable in the second half and warned that higher international oil prices and exchange rates after the Middle East war could slow financial normalization. It also said a higher tariff would help offset accumulated losses, while the level would depend on discussions with the Government.

The finance chief said KEPCO aims to bring bond issuance to twice capital by the end of 2027, mainly through better operating profit. The 20-F states that the debt ceiling is five times share capital and reserves, or six times with ministerial approval, until December 31, 2027, and that budgeted capital expenditure is KRW 23.1 trillion for 2026. A regionally differentiated pricing system is under consideration, with a public hearing expected in the second half; management said it was too early to estimate the effect.

Tariff Regulation and Foreign-Currency Debt

On February 26, 2026 the company proposed a fiscal 2025 dividend of KRW 1,540 per ordinary share, a total of about KRW 988.6 billion, with a December 31, 2025 record date and payment within a month of the March 25 annual meeting. The dividend is annual, and the proposal was subject to approval.

Beyond tariffs and funding, the 20-F flags competition from independent producers, which generated 36.3% of electricity in 2025, volatile carbon allowance prices and exposure to a weaker won, with 16.9% of long-term debt denominated in foreign currencies. Profits depend as much on regulatory decisions as on operations.