On April 24th, according to a report from Yonhap News Agency, KT&G (Korea Tobacco & Ginseng Corporation) will announce its preliminary performance for the first quarter of 2023 on May 11th.
KT&G has announced its plans to increase transparency to the public. Starting with the release of its latest financial report, KT&G will disclose the sales revenue and operating profit of each of its divisions, which will be categorized into tobacco, dried food, real estate, and other businesses.
In the global tobacco industry, KT&G will further disclose the sales proportion in major overseas regions and provide real-time online streaming for global investors to watch and gain information.
Earlier, KT&G disclosed for the first time the revenue and sales data for its domestic and overseas next-generation tobacco products (NGP) when it reported its Q4 2022 financial performance in February.
According to a report by 2FIRSTS, DS Investment & Securities, a South Korean securities investment company, previously predicted that the NGP business of KT&G and KGC Ginseng Corporation would perform well in the first quarter.
KT&G's comprehensive sales increased by 0.1% year-on-year to 1.4 trillion Korean won in the first quarter, but operating profits fell by 17% to 276.1 billion Korean won, which is expected to fall short of market expectations.
However, the decline in operating profits was offset by strong sales of electronic cigarettes and the new Lil Able model.
According to Zhang Zhihui, a researcher at DS Investment & Securities, the profitability of cigarette sales will continue to weaken in the upcoming quarter due to the rising input costs of tobacco. Additionally, there will be a significant decline in performance due to a drop in sales of the high-profit margin real estate business.
Zhang Zhihui said:
Due to an increase in cigarette production costs and a decline in real estate performance, it is expected that KT&G's annual performance this year will be disappointing.
It has been reported that KT&G has chosen to increase transparency, potentially due to demands from external investors.
Flashlight Capital Partners (FCP) has sent a proposal to KT&G, requesting that they improve transparency regarding investor relations (IR).
In this proposal, FCP requests the proactive notification of an IR schedule and the disclosure of sales performance in both domestic and international regions.
KT&G has stated that it has been actively preparing measures to strengthen its communication with the capital market.
2FIRSTS will continue to monitor the first quarter performance disclosure of KT&G. Stay tuned for updates.
Related Reading:
KT&G, the South Korean tobacco company, has increased its short-term borrowing limit to 800 billion Korean won. It also announced that it will require 39 trillion Korean won for long-term investments.
South Korea may abandon its plan to increase taxes on HNB products, which currently have a tax rate of 90.4% similar to traditional cigarettes.
Fimo International's South Korean subsidiary appoints a new CEO.
KT&G reported a 17% decrease in operating profit in the first quarter, but their new tobacco business showed strong growth.
References:
KT&G will announce its provisional first-quarter results on April 11 and will disclose the operating profits of each division.
Disclaimer
This article is provided solely for professional research, industry discussion, and informational purposes. Any references to brands, companies, products, technologies, or policies are made for factual reporting and analytical purposes only, and do not constitute endorsement, recommendation, promotion, or advertising by 2Firsts.
Nicotine-containing products, including but not limited to cigarettes, e-cigarettes, heated tobacco products, and nicotine pouches, carry significant health risks. Readers are responsible for complying with all applicable laws and regulations in their respective jurisdictions, including age restrictions and access limitations.
The information contained in this article should not be regarded as investment, legal, medical, regulatory, or commercial advice. While 2Firsts strives to ensure the accuracy and reliability of its content, it does not assume liability for any direct or indirect loss arising from errors, omissions, inaccuracies, or reliance on the information contained herein.
This article is not intended for individuals below the legal age for accessing tobacco or nicotine-related information in their jurisdiction.
Copyright Notice
This article is either original content produced by 2Firsts or content reproduced, translated, summarized, or adapted from third-party sources with attribution where applicable. The intellectual property rights of the original content remain with 2Firsts or the respective original rights holders.
No individual or organization may copy, reproduce, distribute, republish, modify, translate, or otherwise use this content without prior authorization. Any unauthorized use may result in legal action.
For copyright-related inquiries, corrections, or removal requests, please contact: info@2firsts.com.
AI-Assisted Translation and Editing Notice
Portions of this article may have been translated, edited, or reviewed with the assistance of artificial intelligence tools to improve efficiency and readability. Due to the limitations of AI-assisted translation and editing, discrepancies, omissions, or inaccuracies may exist when compared with the original source.
Where applicable, readers are advised to refer to the original source for the most complete and accurate information. If you identify any errors or believe that any content infringes upon your rights, please contact us at info@2firsts.com, and we will review and address the matter promptly.
