KT&G Reports Robust Q1 Performance: W1.7 Trillion Sales, W365 Billion Operating Profit Driven by Global Growth
KT&G, a leading Korean cigarette company, announced exceptional first-quarter results this year, achieving 1.7 trillion won ($1.17 billion) in sales and 364.5 billion won in operating profit. These figures represent significant year-on-year increases of 14.3 percent and 27.6 percent, respectively, propelled by record-breaking performance in its global cigarette business.
The company’s global cigarette business demonstrated balanced sales volume growth across key markets, notably in the Asia-Pacific and Eurasian regions. This strong international presence contributed to global cigarette revenue reaching 559.6 billion won in Q1, marking a substantial 24.6 percent rise compared to the same period last year.
Looking ahead, KT&G plans to leverage its robust global cigarette business capabilities and extensive distribution networks to accelerate entry into new international markets with its innovative next-generation products, including advanced heat-not-burn (HnB) devices. The next-generation products segment itself reported 241 billion won in first-quarter sales, surging 51.5 percent from the previous year, fueled by impressive growth both domestically and overseas.
Throughout the year, KT&G is committed to rolling out a series of new product innovations. The Korean tobacco giant highlighted its dominant position in the domestic next-generation product market, maintaining an approximate 68.8 percent market share at home.
Meanwhile, KGC, KT&G’s wholly-owned subsidiary specializing in health functional foods, also reported strong results. Its health functional foods business generated 332.6 billion won in sales, an increase of 5.8 percent year-on-year. Operating profit for KGC saw an even more significant boost, climbing 53.3 percent to reach 27.9 billion won, a testament to its expanded revenue in high-profit channels and effective profitability-focused strategies.
Further emphasizing its strategic diversification, KT&G confirmed its commitment to continuous investment in its global nutrition business. Earlier this month, the company established a dedicated center aimed at pursuing red ginseng ingredient business-to-business (B2B) projects. This initiative targets global companies across various sectors, including food & beverage, cosmetics, and other industries, to expand its red ginseng ingredient market footprint.
Lee Sang-hak, Chief Financial Officer at KT&G, commented on the performance, stating, “Despite ongoing geopolitical uncertainties, particularly in the Middle East, we have observed a consistent and stable revenue growth trend across all regions, including Asia-Pacific, Eurasia, and emerging markets. This robust performance indicates a sustained growth trajectory for our global cigarette business.”
He added, “Building on the significant performance growth from our global business expansion, KT&G will continue to implement new shareholder return policies, including enhanced dividends, thereby actively improving overall shareholder value.”
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