Tag: South Korea

Philip Morris Korea Appoints New MD

Photo: Celt Studio
Philip Morris Korea (PMK) has appointed Hannah Yun as its new managing director. Yun will take the helm at the Seoul office on May 1, reports The Korea Times.
“With its cutting-edge technology and dynamic market environment, Korea is one of the most important countries leading Philip Morris’ transformation to a ‘smoke-free future,’” said Yun, who is currently the managing director of Philip Morris Australia. “I will further strengthen the competitiveness of Philip Morris Korea by implementing consumer-centric strategies and services based on my international experience.”
Yun joined PMK in 1997, where she took charge of corporate affairs, business strategy and budget management. From 2003 to 2007, she worked for Philip Morris International in Malaysia, Switzerland and Hong Kong, supporting the development of business growth strategies and operational plans for each market.
She led PMI’s financial analysis and support division in Switzerland from 2008 to 2013, where she was responsible for managing the communication of consolidated PMI financial information.
In 2019, Yun was entrusted with overseeing Philip Morris Australia’s financial and commercial strategies. Two years later, she was appointed as managing director of that affiliate, leading the business in Australia, New Zealand and the Pacific Islands.
PMK’s current managing director, Paik Young-jay, will move on to new opportunities, the firm said. Paik assumed the position amid the Covid-19 pandemic and is credited with establishing a corporate culture of agility and collaboration.
April 19, 2023
KT&G Assists Tobacco Growers

Photo: KT&G
KT&G volunteers helped tobacco growers in Nong’am-myeon plant about 20,000 seedlings on April 14. Since 2017, KT&G workers have been assisting tobacco farmers, who face difficulties recruiting labor in South Korea.
“KT&G engages in employee volunteer activities every year to support the activities of leaf tobacco farms, which have a problem of labor shortages,” said Kim Jeong-ho, director of KT&G’s raw materials department, in a statement. “We will continue to make the best efforts for mutual growth with farmers.”
Since 2013, KT&G has also provided KRW3.34 billion ($2.53 million) in financial support to tobacco growers. The money has paid for scholarships and medical checkups, among other things.
April 18, 2023
Investors Press KT&G on Ginseng Spinoff

Photo: KT&G
A group of activist funds has filed an injunction at the Deajeon District Court in South Korea demanding that KT&G address their demand to spin off its lucrative ginseng business, appoint certain outside directors and strengthen its shareholder return policy, reports The Korea Times.
Led by the Singaporean activist private equity fund Flashlight Capital, the group has repeatedly demanded that the ginseng business be spun off for to recover corporate value and share prices.
However, during an investor relations event last month, KT&G rebuffed the request. “The spinoff will have little to no benefit to the company’s corporate value and shareholders from a long-term perspective,” said KT&G Senior Executive Vice President Bang Kyung-man.
Bang expressed concern that KT&G would potentially lose “synergy” in the event of the ginseng unit’s separation.
During the meeting, KT&G also dismissed the funds’ demand to strengthen KT&G’s shareholder return policy. The cigarette and ginseng product manufacturer said the current policy “should hold for now.”
Flashlight Capital founder Lee Sang-hyun believes KT&G’s share price will bounce back to over KRW140,000, a level last seen in 2016, once the firm reorients its investment portfolio to better achieve environmental, social and governance goals.
KT&G’s share price hit a low of KRW87,100 on Feb. 17 but has recovered since.
February 27, 2023
South Korea: Cigarette Sales Up

Image: Tobacco Reporter archive
Cigarette sales in South Korea increased by 1.1 percent in 2022 compared to the prior year, according to the finance ministry, according to The Korea Herald.
In 2022, smokers purchased 3.63 billion packs of cigarettes compared to 3.59 billion in 2021.
Sales decreased 16.8 percent from 2014, the year before the government raised cigarette prices by 80 percent to help reduce smoking.
Heat-not-burn product demand increased by 21.3 percent while conventional cigarette demand dropped by 1.8 percent.
February 15, 2023
BAT Rothmans Releases New Glo Device

Image: somartin | Adobe Stock
BAT Rothmans has released the glo Hyper X2 heat-not-burn device to the South Korean market, reports The Korea Times.
“Glo Hyper X2 is a next-generation e-cigarette device that will lead the BAT Group’s smoke-free product business,” said Kim Eun-ji, BAT Rothmans’ country manager for South Korea. “We have not only increased the users’ convenience of the platform but also improved its design and portability.”
February 15, 2023
IQOS Iluma One Debuts in South Korea

Photo: PMI
Philip Morris International has introduced its IQOS Iluma One in South Korea, reports The Korea Times. The launch comes three months after the debut of IQOS Iluma and IQOS Iluma Prime models in the country.
According to Philip Morris Korea Managing Director Paik Young-jae, the launch of Iluma One completes the Iluma platform family.
“The first two Iluma models have received a good response from the market, and if this continues, I am hoping that we will reclaim the leading position in the e-cigarette market here,” Paik said.
Since the launch of the IQOS device in 2017, Philip Morris Korea had maintained the No. 1 spot in the domestic heat-not-burn for five years. However, in the first quarter of 2022, KT&G took over market leadership in the first quarter of last year.
IQOS Iluma One retails in South Korea for KRW69,000 ($54.74), which is about 30 percent cheaper than the IQOS Iluma.
The new device is made with an all-in-one lightweight design that can be held in one hand. A single charge can be used to smoke 20 tobacco sticks.
Like other IQOS Iluma models, the IQOS Iluma One uses “Terea Smartcore” sticks, which heat tobacco with an induction system adopted inside its body so that users don’t have to clean any residue afterward.
February 9, 2023
KT&G: Half of Sales from Abroad by 2027

Photo: KT&G
KT&G Corp. aims to earn over half of its sales from overseas businesses in 2027, the company told participants in an investor event.
The South Korean cigarette manufacturer targets sales of KRW10 trillion ($8.1 billion) by that year compared with an estimated annual sales of KRW5.9 trillion for 2022. Last year, KT&G likely earned about one-third of its sales from overseas operations.
In addition to focusing on its combustible cigarette business, the company will reinforce its next-generation product (NGP) businesses, which include heat-not-burn (HnB) products and health functional food products, KT&G Senior Executive Vice President Bang Kyung-man was quoted a saying by the Yonhap News Agency.
“We will invest KRW4 trillion to build new overseas production facilities and expand existing ones in the next five years to meet growing demand for NGPs, like HnB products,” he said.
The company is also considering building a new factory, either in Kazakhstan or eastern Europe, Bang said. To raise the necessary capital, the company plans to sell unused property and borrow money from banks, he said.
KT&G has exported its HnB products to more than 30 countries since 2020 when it signed an agreement with Philip Morris International for the commercialization of KT&G’s smoke-free products outside of South Korea.
KT&G currently earns 90 percent of its revenues from cigarette sales and 10 percent from HnB products. The company has four tobacco manufacturing plants—one each in South Korea, Russia, Turkey and Indonesia—with a combined capacity of 13.6 billion cigarettes a year.
January 26, 2023
KT&G Recognized for Sustainability

Photo: KT&G
KT&G received the Prime Minister’s commendation in the general environmental, social and governance (ESG) sector at the 2022 Sustainable Management Government Award ceremony at the Korea Chamber of Commerce and Industry.
The Government Award for Sustainable Management is the only government award in the sustainable management sector given by the Ministry of Trade, Industry and Energy and the Ministry of SMEs and Startups. It is awarded to institutions or organizations that have contributed to the expansion and leadership of sustainable management, thereby enhancing industrial competitiveness, creating social values and generating achievements.
KT&G was recognized for its efforts to establish and execute a mid-term to long-term vision of environmental management that extends throughout the value chain; for receiving the Equal Salary Certification from the European Commission for the first time for a listed company in South Korea; and for evaluating and supporting the ESG of partner companies to build partnership.
“We are actively promoting the ESG management at the group level to enhance long-term corporate value,” said Kim Jin-han, director of KT&G’s strategic planning, in a statement. “We will continue to strive for mutual growth with our shareholders and other stakeholders through various sustainability management activities.”
December 13, 2022
Kenya Urged to Reverse Tobacco Export Deal

Photo: prehistorik
Anti-smoking activists are urging the government of Kenya to reverse a deal to export more tobacco to South Korea, reports The Star.
During a recent visit to South Korea, Kenyan President William Ruto signed a bilateral trade agreement that will see Kenya increase its exports of tea, coffee and tobacco.
The Kenya Tobacco Control Alliance (KETCA) has asked the president to reconsider his decision, citing fears that the agreement will persuade farmers to grow tobacco even as health advocates are encouraging them to replace the golden leaf with other cash crops.
Concerned about the environmental and health effects of tobacco production and consumption, the World Health Organization, the World Food Program and the Food and Agriculture Organization in collaboration with the Kenyan government launched a project to discourage tobacco production in western Kenya in March.
The project enables the farmers to stop tobacco growing contractual agreements and switch to food crops that will help feed communities.
According to KETCA national coordinator Thomas Lindi, Kenya’s Tobacco Control Act also commits the government to continually phase out tobacco farming in Kenya.
“Any treaty or agreement that binds Kenya to promote tobacco farming is against the Tobacco Control Act and is therefore illegal,” he said. “We ask the government to immediately cancel aspects of the Kenya-South Korea agreement that touch on tobacco.”
Tobacco is a key cash crop for at least 55,000 farmers in Kenya, mostly from the western and southeastern parts of the country. Though the overall contribution to the national economy is relatively small (about 0.03 percent of GDP), tobacco is an important economic activity in the regions where it is farmed.
December 1, 2022
Health Ministry Sued Over Misinformation

Photo: niyazz
The Korea Electronic Cigarette Association (KECA) has sued the Ministry of Health and Welfare (MOHW) and the Korea Disease Control and Prevention Agency (KDCA), demanding the government correct misinformation about e-cigarettes, reports the Korea Biomedical Review.
The KECA’s lawsuit alleges that the government caused financial damage to e-cigarette-related small business owners by releasing incorrect information via an Oct. 23, 2019, press release recommending Koreans stop using liquid e-cigarettes.
The MOHW’s recommendation was issued following an outbreak of lung injuries in the United States that was initially attributed to nicotine vapes but was later determined to be associated with illicit THC products.
“According to the U.S. [Food and Drug Administration’s] notice banning the sale of liquid-type e-cigarettes, which was the basis of the MOHW’s decision that advised smokers to stop using e-cigarettes, tetrahydrocannabinol, a hemp-derived substance, was the main problem,” the KECA said.
In 2019, the U.S. Centers for Disease Control and Prevention stated that there were 530 confirmed severe lung diseases and eight deaths in the U.S. related to the use of liquid-type e-cigarettes.
“However, at the time of the announcement of the MOHW’s recommendation, there was only one suspected case of lung damage in Korea, and even the suspected case came from a person who smoked tobacco,” the KECA said.
According to a paper published in the Journal of Korean Medical Science in December 2021, there were no cases of severe pneumonia or lung damage among liquid e-cigarette users, according to the KECA. The group stated that the MOHW’s failure to withdraw its recommendation to stop use of liquid e-cigarettes shows a neglect of its duties.
A MOHW spokesperson said it will investigate the complaint and respond to the lawsuit in conjunction with other agencies, such as the KDCA and the Ministry of Food and Drug Safety.
October 17, 2022