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Consumer Non-Durables

KT&G Corp.

  • 109,000.00 KRW
  • +1,000.00
  • +0.93%
  • South Korea
    Mar 19, 2019
  • Ticker
    KRX(033780)
  • Prev. close
    108,000
  • Market cap (KRW)
    14,827.59B
  • Market cap (USD)
    13,114.21M
  • Shares
    137.29M

Company Background

KT&G was founded as Korea Monopoly by the South Korean government in 1987. It was later privatized and listed on the South Korean stock market in 1999. It took its current name in 2002. The ginseng business was spun off to form a wholly owned subsidiary, Korea Ginseng.

Because KT&G produces tobacco and ginseng, one might expect the company name to stand for Korea Tobacco & Ginseng; however, it officially stands for Korea Tomorrow & Global.

KT&G no longer gets direct investment from the government; instead, government-affiliated small and midsize banks and national pension funds own stakes in it. It is known in South Korea as a company in which foreign investors have sizable interests.

The bulk of the company's earnings come from its tobacco business, which sells brands such as Esse, Bohem, This and Pine. The South Korean cigarette market has been contracting over the medium term as a smoking ban has been expanded both indoors and outdoors due to health concerns, and prices were raised sharply in 2015.

Sales abroad, on the other hand, are on the rise. The company is boosting exports and producing tobacco in Indonesia, Turkey, Russia and Iran.

KT&G also sells ginseng-based health food and beverages. Ginseng is commonly used as an ingredient for pharmaceuticals.

Business Summary

KT&G Corp. engages in the manufacture and sale of tobacco products. It operates through the Tabacoo and Real Estate Business Divisions. The Tobacco Division manufactures and distributes raw materials needed in production of tobacco. The Real Estates division offers rentals, sales, and housing development. The company was founded on April 1, 1987 and is headquartered in Daejeon, South Korea.

Financial Highlights

Dec 2018 KRWUSD
Revenue4,475.70B4,066.90M
Gross Profit2,639.90B2,398.77M
Operating income1,263.20B1,147.82M
Income before tax1,331.40B1,209.79M
Net income909,200M826.15M
EBITDA----
Diluted EPS----
Dividends Per Share4,0003.63
Total Assets10,161.30B9,106.73M
Total liabilities2,020.90B1,811.16M
Total equity8,086.60B7,247.35M
Operating cash flow857,500M779.17M
Currency in KRWCurrency in USD

Historical Data

 Dec 2014Dec 2015Dec 2016Dec 2017Dec 2018
Revenue 4,112.85B 4,169.83B 4,503.27B 4,667.19B 4,475.70B
Gross Profit 2,214.94B 2,487.04B 2,661.83B 2,709.98B 2,639.90B
Operating income 1,171.87B 1,365.89B 1,469.55B 1,426.09B 1,263.20B
Income before tax 1,154.66B 1,399.25B 1,587.33B 1,345.62B 1,331.40B
Net income 825,605.72M 1,035.71B 1,230.77B 1,163.75B 909,200M
EBITDA 1,333.92B 1,527.74B 1,628.24B 1,587.13B --
Diluted EPS 6,558 8,222 9,755 9,217 --
Dividends Per Share 3,400 3,400 3,600 4,000 4,000
Total Assets 7,418.66B 8,673.35B 9,812.08B 9,975.90B 10,161.30B
Total liabilities 1,710.58B 2,397.85B 2,694.32B 2,146.14B 2,020.90B
Total equity 5,630.60B 6,208.90B 7,045.20B 7,772.05B 8,086.60B
Operating cash flow 815,659.51M 1,303.14B 1,547.34B 1,189.76B 857,500M
 Dec 2014Dec 2015Dec 2016Dec 2017Dec 2018
Revenue 3,907.11M 3,684.24M 3,881.50M 4,128.39M 4,066.90M
Gross Profit 2,104.13M 2,197.41M 2,294.30M 2,397.13M 2,398.77M
Operating income 1,113.25M 1,206.83M 1,266.65M 1,261.46M 1,147.82M
Income before tax 1,096.90M 1,236.30M 1,368.16M 1,190.27M 1,209.79M
Net income 784.30M 915.10M 1,060.83M 1,029.40M 826.15M
EBITDA 1,267.19M 1,349.83M 1,403.42M 1,403.91M --
Diluted EPS 6.22 7.26 8.40 8.15 --
Dividends Per Share 3.22 3.00 3.10 3.53 3.63
Total Assets 6,749.45M 7,397.00M 8,123.93M 9,318.48M 9,106.73M
Total liabilities 1,556.27M 2,044.99M 2,230.77M 2,004.71M 1,811.16M
Total equity 5,122.68M 5,295.21M 5,833.08M 7,259.86M 7,247.35M
Operating cash flow 774.85M 1,151.38M 1,333.70M 1,052.40M 779.17M

Valuation Measures

Dec 2018
PER15.32
ROA9.03%
ROE11.46%
Operating margin28.22%
Profit margin20.31%

Key executives

  • President, Chief Executive Officer & Director: Bok-In Baek
  • Managing Director & Head-Finance: Gyeong-Bo Kang
  • Managing Director, Head-Research & Development: Chang-Hyo Lee
  • Director & Vice President: Heung-Ryeol Kim
  • Vice President & Head-Sales: Hyeon-Jin Kim

Shareholders

  • National Pension Service of Korea (10.0%)
  • KT&G Corp. (8.0%)
  • Industrial Bank of Korea (6.9%)
  • First Eagle Investment Management LLC (5.8%)
  • DWS Investment GmbH (2.9%)
  • BlackRock Fund Advisors (2.6%)
  • The Vanguard Group, Inc. (2.2%)
  • KT&G Corp. Employee Stock Ownership Association (2.1%)
  • Japan Tobacco Inc. (2.0%)
  • Thornburg Investment Management, Inc. (1.7%)

Contact Details

  • Website:http://www.ktng.com
  • Address: 71 Beotkkot-gil, Daedeok-gu, Daejeon, 34337, South Korea
  • Phone: +82.42.939.5000

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  • KT&G Corp. Employee Stock Ownership Association
  • Yungjin Pharm. Co., Ltd.

Competitors

  • AmorePacific Group, Inc.
  • LG Household & Health Care Ltd
  • Estee Lauder Companies Inc. Class A
Last Updated on 19 Mar, 2019

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