KT&G to Reveal Q1 Financial Report, NGP Performance to be Released
According to a Yonhap News Agency report, KT&G (Korea Tobacco Ginseng Corporation) will reveal its Q1 2023 financial results on May 11. The company aims to improve transparency, beginning with this earnings release, by sharing sales revenue and operating profits for each division.
In the global tobacco sector, KT&G will further disclose sales proportions for major overseas regions and stream the announcements online, allowing global investors to watch and understand the information.
Previously, in February, KT&G disclosed domestic and overseas NGP (Next Generation Tobacco Products) revenue and sales volume for the first time when announcing Q4 2022 financial results.
DS Investment & Securities previously predicted that KT&G's NGP business and KGC Ginseng Corporation would perform steadily in Q1. The company's overall sales revenue is expected to grow 0.1% YoY to KRW 1.4 trillion, but operating profit is predicted to decline 17% to KRW 276.1 billion ($206 million), falling short of market expectations.
DS Investment & Securities analyst Jang Ji-hui stated that cigarette profitability would remain weak due to increased input prices of tobacco leaves. Additionally, a decrease in sales revenue from high-margin real estate business contributed to the significant decline in performance.
Jang Ji-hui said, "Due to increased cigarette costs and declining real estate performance, KT&G's annual performance is expected to be lackluster this year."
KT&G's decision to increase transparency may be related to demands from external capital. Flashlight Capital Partners (FCP) previously sent a proposal to KT&G requesting improved transparency regarding investor relations (IR). In the proposal, FCP asked for proactive notifications of the IR schedule and sales disclosures for domestic and international regions.
KT&G responded that it has been preparing measures to strengthen communication with the capital market.
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