#South Korea #Seoul #dividends #Shareholder Returns #KT&G

KT&G: A Commitment to Shareholder Returns

KT&G Corporation, a leading company in the tobacco industry, has announced significant developments in its dividend policies aligning with its notable profit growth. On August 22, 2025, the company reported impressive financial results, showcasing a first-half revenue surpassing 3 trillion KRW, continuing a trend of positive growth for the third consecutive quarter.

Record-Breaking Financial Performance

The global cigarette segment of KT&G has consistently achieved remarkable growth, boasting five consecutive quarters of what can only be described as 'triple growth'. The figures reflect a substantial increase, with revenue improving by 30.6%, sales volume rising by 9.1%, and adjusted operating profit soaring by an impressive 51.1%. This indicates not only the strength of KT&G's operational strategies but also its potential for expanded shareholder benefits.

Increased Dividends: A Sign of Confidence

In light of these robust financial results, KT&G has decided to elevate its interim dividend by 200 KRW, bringing it to 1,400 KRW per share. This decision highlights the company's commitment to enhancing shareholder value and reflects a careful consideration of various factors such as stock repurchase cancellations, profit increases, and market conditions. According to the company's Chief Financial Officer, Sang-Hak Lee, this decision is a direct response to the solid performance recorded in the first half of the year.

Since the company went public in 1999, KT&G has maintained a consistent dividend payout, marking 26 straight years of either maintaining or increasing its dividends. The recent history demonstrates this trend with incremental rises over the last three years: 5,000 KRW in 2022, 5,200 KRW in 2023, and 5,400 KRW in 2024.

Future Commitments and Share Repurchase Initiatives

KT&G is not only focusing on the current financial cycle but is also looking ahead to the future. The company has announced plans to implement bold shareholder return strategies from 2024 to 2027, aiming to cancel 20% of issued shares, including those repurchased. This initiative results in a continuous decrease in the number of outstanding shares while maintaining a total annual dividend payout around 580 to 590 billion KRW, thus enhancing the dividend per share.

Moreover, KT&G has set an ambitious goal for double-digit annual operating growth. With stock prices on the rise, analysts express optimism regarding the potential for increased annual dividends per share.

Analyst Perspectives and Industry Outlook

Looking at insider perspectives, analysts from Morgan Stanley project a favorable outlook for KT&G's dividend trends. They have emphasized that as management weighs dividend yield alongside rising earnings, there is a promising potential for an elevation in the dividend per share (DPS) forecast.

Analyst Kelly Kim stated, "Given the management's approach to prioritizing dividend yield and the backdrop of increasing earnings, we foresee further upside to our DPS assumptions, potentially reaching 5,800 KRW in the near future."

In Summary, KT&G is showcasing a proactive approach to its financial health and shareholder relations through strategic dividend increases and share repurchase initiatives. With a strong commitment to consistency and growth, KT&G is poised to continue its trajectory of enhancing shareholder value in the years to come. The company stands as a notable example of how robust earnings paired with strategic policies can lead to long-term shareholder satisfaction.

• ---

For any investor or stakeholder of KT&G, this forward-looking strategy offers reassurance of the company’s dedication to not just sustain but enhance shareholder value amidst a challenging market environment.