KT&G (033780.KS) said on the 22nd that it will buy back and cancel about 360 billion won ($260 million) worth of its own shares to lift shareholder value.
The company's board approved a plan the same day to purchase 2.07 million treasury shares on the open market, equal to roughly 2% of total shares outstanding. KT&G will begin buying on the 23rd and cancel the entire amount as soon as the acquisition is complete.
The move carries out a plan announced in February to buy back and cancel more than 300 billion won in shares. KT&G also cancelled about 1.8 trillion won worth of treasury shares in April. With that, the company has already met the share cancellation target in the medium- to long-term shareholder return plan it presented in November 2024, which called for retiring 20% of shares outstanding as of 2023.
On the back of improved earnings, KT&G also set its interim dividend at 2,000 won per share, up 600 won from a year earlier. Consolidated revenue for the first half came to 3.4052 trillion won, up 12.0% from a year earlier, while operating profit rose 22.6% to 779 billion won. The company said overseas cigarette sales and its next-generation products (NGP) business drove the gains.
Global asset managers have continued to add to their stakes amid the earnings growth and expanded shareholder returns. U.S. investment firm Capital Group has raised its holding to 8.22%, while BlackRock holds 6.15%. KT&G plans to announce a new medium- to long-term shareholder return policy centered on higher dividends in the fourth quarter.
"We decided on this buyback and cancellation to improve the predictability of our shareholder return policy and to strengthen confidence in the capital market and per-share value," a KT&G official said. "We will continue to do our utmost to enhance shareholder value, including by building a virtuous cycle of earnings growth and expanded shareholder returns."
