Slides
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COMPOUND 2030 2026 KT&G Capital Markets Day
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Disclaimer The financial information in this presentation is based on K-IFRS standards. This presentation and related discussions contain certain forward-looking statements related to expected future business, financial performance and/or the industry forecasts which are uncertain. Therefore, the recipients of this presentation shall be aware of that the forward-looking statements set forth herein may not correspond to the actual results.
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KT&G Capital Markets Day Group Earnings Record-high Revenue ('26E1) Revenue Growth ('23 vs. '26E1) OP Growth ('23 vs. '26E1) 7.0 1.5 1.3 1.2 KRW 7 trn +19% +28% Shift to Profit 21 '23 '26E1 5.3 5.9
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KT&G Capital Markets Day Results International Business-led Growth Structural Readiness for Profit Enhancement Securing a Future Growth Driver Stronger Shareholder Value % International Revenue of Tobacco Business 50%+ Overseas Production Capacity 2x NGP Revenue Growth +15% Commitments 4 Delivering on our Commitments Total Shareholder Return Ratio 100%+ Share Count 24% 1 2 3
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Growth Algorithm 01
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KT&G Capital Markets Day Three Growth Engines International CC Cash Cow Next Growth Pillar NGP HFF Multiple Driver
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KT&G Capital Markets Day Brand Value USD2.1bn Global No.1 SuperslimBrand StrategicASP Increase Market Share 35%+ Pricing Headroom c.20% Mix Improvement via Product Innovation 15% 1 2 3 Pricing and MixCombustible Cigarette 1 4
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KT&G Capital Markets Day Targeting Whitespace Outlet Coverage Broader Market Distribution ‘25 ’30T 70%+ 1 30+ Markets incl. India and Vietnam Volume Evolution2Combustible Cigarette
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KT&G Capital Markets Day International CC Revenue and OP Double digit % Cost Savings KRW 550bn+ Expanding Subsidiary Business Economic Manufacturing System 70%+ % of Overseas Production Cost Reduction Initiatives ’26E ’30T +50% Structural Edge3Combustible Cigarette
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KT&G Capital Markets Day 4th Generation lil Tonino LAMBORGHINI 2017 2018 2022 3 sec Pre-heating Ongoing Innovation 9,500 1 Innovation Pipeline1HNB Aggregate Patents Granted and Pending
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KT&G Capital Markets Day Segmenting Demand as Market Matures GlobalHNB Penetration over 5% Nascent Stage Early Growth Phase High-Growth Phase Early Adopter- Driven Price Tiering Demand Segmentation (Performance · Form Factor) Penetration Rate '23 '25 Multi-Platform Strategy2HNB '17 '18 '19 '22 '26 1st Gen Launch 2nd Gen Launch DomesticHNBPenetration over 5% Korean Market Case 3rd Gen Launch 4th Gen Launch KT&GHNBshare in c-stores 2% 32% 47% ~50% 16%
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KT&G Capital Markets Day Global Partnership Scaling Up Direct Business 2030 GlobalTop 2 Rapid Rollout of New Platforms Deployment of the Multi-Platform Strategy in 15+ Markets Hub markets incl. Kazakhstan and Taiwan Major markets incl. Europe Two-Track Strategy2HNB
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KT&G Capital Markets Day GlobalExpansion 3 Nordic Markets Key Markets by Region 2030Aspiration Korea / Japan UAE South Africa UK Nordics US (Global No.1 Market) Global Market Presence ~70 Markets GlobalMarket Share 5%+ (GlobalTop 5 Player) Largest Nicotine Pouch Market Entry into US Aspiring for Top 51Nicotine Pouch
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KT&G Capital Markets Day Structural Improvement in Fundamentals 6% 10% '23'22 24 '25 '26E Commitments OP Margin Larger Online Channel Presence Product Portfolio Efficiency Production Efficiency and Inventory Reduction 1 Profit Turnaround1HFF
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KT&G Capital Markets Day Growth Strategy 2030 Milestone B2B Expanding Ingredients Business B2C Launching Localized Formulations Commercialization Partnership with Global Leaders F&B Beauty & Wellness Global Growth Opportunity2HFF Share of Overseas Revenue 30%+
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KT&G Capital Markets Day Mid-to-high single digit % 30%+ Financial Performance Portfolio Transformation Continuous Profit Growth Portfolio Transformation towards Global ∙ NGP (’26~’30 CAGR) (2030) Operating Profit % Overseas Revenue of CC Business What to Expect by 2030 70%+ 30%+ % Overseas Revenue of HFF Business % NGP Revenue of Tobacco Business
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Value Algorithm 02
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KT&G Capital Markets Day Disciplined Capital Allocation Regular Shareholder Return Business-Generated Cash Flow Recurring Capex Regular Shareholder Return Core Cashflow 1
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KT&G Capital Markets Day Agg. ’27~'30 KRW 1.2 trn Improved Regular Shareholder Return DividendPayout Ratio ‘25 ’30T 75%+ Shift to Executing Year-Round Buybacks Share Buyback · Cancellation
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KT&G Capital Markets Day Larger Scale, More Upside Regular Return KRW 4 trn Regular Return KRW 5 trn Potential Special Return Agg. ’27~’30 1 25%+
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KT&G Capital Markets Day Add'l funding if needed Compounding Value 2030 KRW 8,000 2026 DPS (+33% vs. PY) 75%+ Dividend Payout Ratio KRW 1.2trn Share Buyback · Cancellation KRW 5 trn Regular Shareholder Return 1 2 3 3
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Thank You