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(LEAD) KT&G Q3 net jumps 29 pct on strong exports and weak won

All News 17:04 November 03, 2022

(ATTN: RECASTS throughout; ADDS photo)

SEOUL, Nov. 3 (Yonhap) -- KT&G Corp., South Korea's dominant tobacco company, said Thursday its third-quarter net profit jumped 29 percent from a year earlier on increased exports and a weak won.

Net profit for the three months ended in September rose to 463.14 billion won (US$325 million) from 359.58 billion won during the same period of last year, the company said in a statement.

"The bottom line got a boost from increased sales of heat-not-burn products in the domestic market and increased overseas sales amid a weak won" against the dollar, the statement said.

A weak won drives up the value of dollar-denominated earnings when repatriated into the local currency. The dollar rose to an average of 1,338 won in the third quarter from 1,157 won a year earlier, according to the Bank of Korea.

Heat-not-burn or "smokeless tobacco" products are electronic devices that, unlike e-cigarettes, contain tobacco. The tobacco is heated to a high temperature, without setting it alight and creating smoke that the user sucks in.

Operating profit fell 2.7 percent to 405.61 billion won in the third quarter from 417.03 billion won a year ago. Sales were up 8.5 percent to 1.62 trillion won from 1.49 trillion won during the cited period.

In the domestic market, KT&G sold a total of 11.05 billion cigarettes in the third quarter, down 0.4 percent from 11.09 billion a year earlier. It accounted for 65 percent of the local cigarette market.

But its overseas sales jumped 30 percent to 12.2 billion cigarettes in the September quarter from 9.4 billion a year ago on rising demand from emerging markets.

Currently, KT&G earns 90 percent of its overall sales from the cigarette business division and the remaining 10 percent from the heat-not-burn division.

From January to September, net income climbed 21 percent to 1.06 trillion won from 878.58 billion won in the same period of last year.

This file photo offered by KT&G shows its heat-not-burn products "lil SOLID 2.0." (PHOTO NOT FOR SALE) (Yonhap)

This file photo offered by KT&G shows its heat-not-burn products "lil SOLID 2.0." (PHOTO NOT FOR SALE) (Yonhap)


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