KT&G delivered a strong performance in 2023. Photo Credit: Kwangmo, Creative Commons.
KT&G posted revenue of KRW1.451 trillion (US$1.01 billion) and operating profit of KRW198.6 billion (US$149.2 million) in the fourth-quarter. For the full-year, the company reported record revenue of KRW5.872 trillion (US$4.41 billion) and operating profit of KRW1.168 trillion (US$877.2 million).
KT&G's record annual revenue was mainly driven by the outstanding performance in the overseas combustibles business, which is one of the three core business areas (overseas combustibles, next generation products (NGP), and health functional food), as declared by the company. The overseas combustibles business reported record annual revenue of KRW 1.139 trillion (US$855.4 million). The combined annual revenue of the three core business areas including overseas combustibles reached KRW 3.313 trillion (US$2.49 billion), a 1.1% increase YoY.
KT&G also delivered a robust performance in its NGP business, supported by the continued growth in sales volume. In 2023, KT&G sold 8.24 billion sticks in overseas markets and 5.71 billion sticks in the domestic market, reflecting impressive two-digit YoY growth rates of 43% and 14.4%, respectively.
Driven by the outstanding performance of overseas subsidiaries in combustibles sales and overseas NGP sales volume growth, KT&G achieved an unprecedented milestone with an all-time high total overseas sales volume of 61.4 billion sticks, surpassing 60 billion sticks for the first time.
KT&G foresees a robust financial performance for 2024, projecting the annual revenue and operating profit to exceed the growth rate of 10% and 6%, respectively. This optimistic outlook is driven by the expectation of a YoY growth exceeding 15% in combined revenue from the company's core business areas. Additionally, the operating profit from the core business areas is expected to grow 31.5% YoY, surpassing the revenue growth rate and further contributing to the overall optimism for the fiscal year 2024.
KT&G is currently in the process of assessing candidates to succeed incumbent c.e.o. Baek Bok-in, who expressed his intention not to seek reappointment. The final c.e.o. candidate is expected to be announced by the end of this month. The new c.e.o will be appointed following approval at the annual general meeting in March.