KT&G (033780) Q2 2026 earnings summary

Executive summary

• Consolidated Q2 2026 revenue rose 9.9% year-over-year to KRW 1.7016 trillion, with operating profit up 18.5% to KRW 414.5 billion, driven by robust tobacco business growth and contributions from HFF and real estate segments.

• Net income surged 152.3% to KRW 362.1 billion in Q2, and EPS increased 164.2% to KRW 3,509, supported by higher operating profit and currency-related gains.

• Achieved four consecutive quarters of double-digit operating profit growth and two years of record-high H1 revenue, reaching KRW 3.4 trillion in H1 2026.

• The group operates globally with 33 consolidated subsidiaries and maintains a strong credit profile with top domestic and international ratings.

• The company is listed on the KOSPI and has a robust governance structure with an independent board and multiple committees.

Financial highlights

• EBITDA grew 17.4% to KRW 494.4 billion in Q2, with an EBITDA margin of 29.1%.

• Gross profit margin improved to 50.4% from 46.5% year-over-year.

• Operating profit margin increased to 28.1% from 27.5% year-over-year.

• Net income margin rose to 21.3% from 9.3% year-over-year.

• Consolidated sales for H1 2026 were KRW 3,405.2 billion, up 12.0% year-over-year.

Outlook and guidance

• Annual revenue growth target revised up to 5%-7% (from 3%-5%), and operating profit growth target to 10%-13% (from 6%-8%).

• The company targets a total shareholder return ratio of at least 100% of net income and aims to retire over 20% of shares (based on 2023 year-end outstanding shares) by 2027.

• Dividend policy emphasizes stable and predictable payouts, with a minimum payout ratio of 50%.

• Ongoing investments in global production capacity and green projects are funded by recent bond issuances.

• New NGP platform with innovative heating technology to launch in Korea in Q3, and independent HNB product launches planned in two overseas markets.