KT&G releases Q2 financial report: total profit increased by 30.6% to US$230 million, and overseas tobacco business profit increased by 139.1%

KT&G releases Q2 financial report: total profit increased by 30.6% to US$230 million, and overseas tobacco business profit increased by 139.1%

South Korean tobacco manufacturer KT&G today announced its financial results for the second quarter ended June 30, 2024. The company reported consolidated revenue of 1,424 billion won (about $1.03 billion) and operating profit of 321.5 billion won (about $230 million), up 6.6% and 30.6% year-on-year, respectively.

According to PR Newswire on August 8, South Korean tobacco manufacturer KT&G (KRX: 033780) held a financial conference call today and announced its financial results for the second quarter ended June 30, 2024. The company reported consolidated revenue of 1,424 billion won (about $1.03 billion) and operating profit of 321.5 billion won (about $230 million), up 6.6% and 30.6% year-on-year, respectively.

The growth was mainly driven by the strong performance of the overseas tobacco business, one of the company's three core growth businesses. The overseas tobacco business achieved growth in all key indicators, including revenue, operating profit and sales volume, with revenue reaching a record high of 359.1 billion won (about US$260 million), a year-on-year increase of 35.3% in the quarter, and operating profit of 139.1% year-on-year.

The domestic (Korea) new tobacco products business ("NGP") achieved growth in key indicators, including revenue, operating profit and sales volume, with year-on-year growth of 10.8%, 42.8% and 7.7%, respectively. Thanks to the increase in sales of heat-not-burn tobacco products, the profitability of overseas business continued to improve.

KT&G said it will accelerate the realization of its vision of becoming a "global top" company by strengthening the basic competitiveness of core growth businesses and structural reforms. To this end, the company signed a memorandum of cooperation with Philip Morris International in July to jointly submit a U.S. pre-market tobacco product application (PMTA) for KT&G's new generation of heat-not-burn tobacco products.

In the earnings call, KT&G mentioned that the company expects annual consolidated revenue to grow by 2.5-3%, while operating profit will remain flat due to changes in the business environment in the health functional food and real estate sectors.

A KT&G spokesperson said:

"We achieved growth in revenue and operating profit in the second quarter by expanding overseas business. We will continue to maximize the company's value by strengthening the competitiveness of core growth businesses and enhance shareholder value through the best shareholder return policy."