KT&G Reports Results and Presents Growth Plan

KT&G reported consolidated revenue for the third quarter of KRW1.64 trillion and operating profit KRW415.7 billion, up 2.2 percent year-on-year.

The growth trend centered on the main business continued in the third quarter. Revenue of the three companies core growth businesses—overseas cigarettes, next generation products (NGP) and health-functional foods exceeded KRW1 trillion, achieving the highest-ever quarterly revenue, while the revenue of the tobacco business also reached a record high.

Revenue in the tobacco business reached KRW1.048 trillion, up 7.7 percent from the same period last year, while operating profit grew 23.6 percent to KRW333 billion, outpacing the revenue increase.

In the tobacco business, growth was particularly strong in overseas cigarettes. In the third quarter, revenue of the overseas cigarette business reached KRW419.7 billion, up 30.5 percent year-over-year, setting a new record in revenue for two consecutive quarters, while sales volume and operating profit also increased by 10.1 percent and 167.2 percent, respectively, achieving growth trifecta in sales volume, revenue and operating profit.

While reporting its financial results, KT&G also announced a plan to achieve 15 percent return on equity (ROE) by 2027, to increase cash returns and to repurchase and cancel shares.

Since the appointment of CEO Kyung Man Bang in March, KT&G has been working to increase its competitiveness and upgrade the group’s financial structure. In particular, the company has been prioritizing the group’s ROE enhancement project, which is based on profitability improvement, asset efficiency and financial optimization.

Under the new corporate value-up plan, shareholder return will also be expanded in 2024. KT&G’s board of directors resolved to repurchase 1.35 million shares with KRW150 billion of the financial resources secured through the securitization of non-core and low-yield assets and to cancel them in full within the year.

“We are in full swing in creating results by strengthening our business structure centered on our core business and upgrading our financial structure to become a ‘global top-tier’ company,” KT&G wrote in a press note. “We will continue to focus our resources and capabilities on our three core businesses to strengthen our intrinsic competitiveness and return the fruits of our achievements to our shareholders to achieve true value-up where corporate value and shareholder value grow together.”