KT&G reports record Q3 revenue on robust overseas sales

[KT&G]

KT&G, Korea's largest tobacco company, reported a record-high quarterly revenue of 1.69 trillion won ($1.28 billion), a 4 percent increase from same quarter last year, thanks to robust sales of its cigarettes overseas.

The figure exceeded analysts' expectations of 1.66 trillion won as compiled by market tracker FnGuide.

Operating profit rose 0.3 percent on year to 406.72 billion won in the third quarter, boosted by increased exports of its heat-not-burn (HNB) product lil — beating the market consensus of 364.2 billion won. HNB products are electronic devices that, unlike e-cigarettes, contain tobacco. The tobacco is heated to a high temperature without setting it alight to create smoke that the user inhales.

“Our overseas combustible business delivered impressive growth across all key metrics, including sales volume and revenue,” the company explained.

The company's third-quarter net profit, however, fell 28 percent from a year earlier to 333.29 billion won due to foreign exchange losses. It was still above the market consensus of 283.5 billion won.

KT&G has six tobacco manufacturing plants: three in Korea and three overseas, with one each in Russia, Turkey and Indonesia.

Last month, the company began the construction of its fourth overseas plant in Kazakhstan as part of its expansion strategy. It aims to complete the plant's construction by 2025 to export its products to the Eurasian region.

The Korean tobacco firm aims to earn half of its sales from its overseas businesses in 2027. It wants to achieve sales of 10 trillion won in 2027, compared to 5.9 trillion won in 2022.

BY SEO JI-EUN,YONHAP [seo.jieun1@joongang.co.kr]