KT&G (033780) Q2 2024 earnings summary

Executive summary

• Q2 2024 consolidated revenue rose 6.6% YoY to KRW 1.438 trillion, with operating profit up 30.6% YoY to KRW 321.5 billion, and net income up 57.5% to KRW 318 billion, driven by strong tobacco and global business performance.

• EPS increased 59.5% YoY to KRW 2,754.

• The company is executing a three-year shareholder return plan (2024–2026) with KRW 1.8 trillion in dividends and KRW 1 trillion in share buybacks, including a new interim dividend and additional buyback/cancellation in H2 2024.

• A new corporate value enhancement plan will be disclosed in H2 2024.

• H1 2024 revenue was ₩2,716.0 billion (-0.6% YoY), with operating profit at ₩558.6 billion and net profit at ₩598.4 billion.

Financial highlights

• EBITDA rose 25.4% YoY to KRW 383.1 billion, with a margin of 26.9%.

• Operating profit margin improved to 29.8% YoY; net income margin at 22.3%.

• Cash and cash equivalents at quarter-end were KRW 1,024.2 billion.

• EPS for H1 2024 was ₩5,206.

• Total assets: ₩13,545.6 billion; total equity: ₩9,489.1 billion.

Outlook and guidance

• 2024 consolidated revenue growth revised to 2.5%-3% YoY (from 10%-10.5%), and operating profit now expected to remain flat YoY.

• Tobacco business expected to maintain robust growth and meet prior guidance in H2 2024; segment guidance: revenue +9.0–9.5%, operating profit +6.0–6.5% YoY.

• HFF revenue projected to decline 2.5%-3% YoY, with operating profit down 28%-28.5% YoY.

• Real Estate revenue expected to drop 34.5%-35% YoY, with operating profit down 92.5%-93% YoY.

• Guidance for stable dividend and ongoing share buybacks through 2026.