KT&G Posts 21% YoY Rise in Q1 Operating Profit to 285.6 Billion Won... "Strong Overseas Cigarette Sales"

Overseas Cigarette Sales Reach Record 449.1 Billion Won This Quarter
Operating Profit Surges 313%
KT&G: "Global Strategy Delivers Results Since President Bang Kyungman Took Office"

KT&G announced in a regulatory filing on May 8 that its consolidated operating profit for the first quarter of this year was provisionally tallied at 285.6 billion won, up 20.7% from the same period last year. Revenue increased by 15.4% to 1.4911 trillion won, while net profit declined by 9.7% to 257.9 billion won.

By business segment, the tobacco division saw both revenue and operating profit rise to 988 billion won and 252.9 billion won, respectively, up 15.3% and 22.4%, thanks to robust growth in overseas operations.

The overseas cigarette business recorded a 312.5% increase in operating profit, driven by price hikes and expanded sales volume in key regions. Revenue jumped 53.9% to 449.1 billion won, marking the highest quarterly figure ever. KT&G explained that it achieved triple growth?operating profit, revenue, and sales volume all increasing?for four consecutive quarters.

KT&G stated, "This is the result of the full-fledged achievements of the locally integrated global value chain strategy that President Bang Kyungman has actively pursued since taking office last year. The expansion of local infrastructure, such as the new Kazakhstan plant completed last month and the new Indonesian plant currently under construction and slated for completion next year, is expected to further accelerate the growth of our global business."

The NGP (Next Generation Product, heat-not-burn tobacco) business saw domestic sales rise by 6.5%, driven by the popularity of the 'lil Hybrid' product.

KGC Ginseng Corporation's health functional food business posted a 1.9% increase in sales, attributed to domestic holiday events and growth in key overseas markets.

KT&G's real estate business division contributed to the company's improved profitability, reporting revenue of 100.4 billion won and operating profit of 10.4 billion won, reflecting the performance of its development projects.

Previously, KT&G unveiled a value-up plan to return 3.7 trillion won in cash to shareholders by 2027 through dividends and share buybacks, and to cancel more than 20% of its total outstanding shares, including newly acquired treasury shares.

As a result, last year the company executed about 1.1 trillion won in cash returns, achieving a total shareholder return ratio of 100%, and canceled treasury shares equivalent to 6.3% of its total outstanding shares.

KT&G stated that it has continued its shareholder value enhancement strategy in the first quarter of this year by canceling treasury shares worth 360 billion won, equivalent to 2.5% of its total outstanding shares.

A KT&G representative said, "Despite a challenging business environment, including sharp exchange rate increases and sluggish domestic demand, we achieved simultaneous growth in revenue and operating profit by strengthening our core business competitiveness and focusing on the global cigarette business."