MIRA
INFORM REPORT
|
Report Date : |
23.07.2007 |
IDENTIFICATION DETAILS
|
Name : |
KT & G CORPORATION |
|
|
|
|
Registered Office : |
100, Pyeongchon-dong, Daedeok-gu, Daejeon - 306-712 |
|
|
|
|
Country : |
|
|
|
|
|
Financials (as on) : |
31.03.2007 |
|
|
|
|
Date of Incorporation : |
04/01/1987 |
|
|
|
|
Legal Form : |
Listed Company |
|
|
|
|
Line of Business : |
Manufacture of Tobacco Products Wholesale of Tobacco |
RATING & COMMENTS
|
MIRA’s Rating : |
A |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Exists |
Basic
|
Company
Name |
KT & G CORPORATION |
|
Registered Address |
100, Pyeongchon-dong, Daedeok-gu, |
|
Zip Code |
306-712 |
|
Tel |
+82-42-939-5000 |
|
Fax |
+82-42-939-5240 |
|
E-mail |
hdwkyh@ktng.com;mustafa1@ktng.com |
|
Website |
www.ktng.com |
|
Trading Address |
1002, |
|
Tel |
+82-2-3404-4521 |
|
Fax |
+82-2-3404-4515 |
|
Type |
Export/Import |
|
Industry |
Manufacture of Tobacco Products |
|
Main Business |
Tobacco |
|
Sub
Business |
Wholesale of Tobacco |
|
Established (mm/dd/yyyy) |
04/01/1987 |
Detailed Products
|
Activity |
Detailed Products (UNSPSC) |
|
Sell |
Cigarettes or cigars(50211502) |
|
Sell |
Formulas and products for nutritional
support(42231800) |
CEO’s
|
Name |
Kwak Young-Kyoon |
|
Date of Birth |
01/10/1951 |
|
Title |
President & CEO |
|
Sex |
Male |
|
Nationality |
Korean |
Profiles
|
Capital |
954,959,485,000 KRW |
||||||||||||||||||
|
Employees |
4,283 |
||||||||||||||||||
|
Formation |
Listed Company ( A Company of KT&G Group |
||||||||||||||||||
|
Bank Details |
Nonghyup Bank-KT&G Branch |
||||||||||||||||||
|
Corporate Registered No. |
160111-0067804 |
||||||||||||||||||
|
Business Registered No. |
306-81-30866 |
||||||||||||||||||
|
Permit & Licenses |
08/1996 ISO 9002 09/1997 ISO 9002 06/2001 ISO 9001 Int’l Trade No.: 895978 |
||||||||||||||||||
|
Shareholder Position |
|
||||||||||||||||||
|
Company History |
04/01/1987
Established as Korea Tobacco & Ginseng Corporation 10/1997 Incorporated
by the law on the Corporate Structuring & Civilization of Public Corporation 01/1999 Split Red Ginseng Division to
Korea Ginseng Corporation 10/08/1999
Listed at KSE 10/2001
Listed at Luxemburg Stock Exchange 12/27/2002
Changed company name to the present name 06/15/2004
Designated as the best Corporate Governance Company 06/22/2005 Designated
as the best Corporate Governance Company 11/25/2005
Awarded the 5th 11/24/2006
Awarded the 6th |
||||||||||||||||||
|
|
|
The Subject Company
is a Korea-based company primarily engaged in the production and sale of
cigarettes. The Company produces cigarettes under the brand names of LO CRUX,
Indigo, SEASONS, VISION, Zest, Cloud9, The One, Esse, Esse Light, Esse Menthol,
Raison, Fresh Raison, Season, Lumen, Cima, Simple, Time, Time Light, Humming
Time, Rich, DoragiYoun, Hanaro, Get2, Mount, Shinabro, Hallasan, This, This
Plus, This Zin, Expo, Lilac, Lilac Menthol, 88 Deluxe, 88 Light, 88 Menthol,
Rose and Carnival, among others. KT&G operates five tobacco leaf processing
and tobacco manufacturing plants: Shintanjin, Wonju,
Management
|
Job Description |
Title |
Name |
Nationality |
Date of Birth |
Education |
|
President & CEO |
Mr. |
Kwak Young-Kyoon |
Korean |
51.1.10 |
|
|
Sr. Executive Director |
Mr. |
Lee Kwang-Yol |
Korean |
56.11.14 |
|
|
Sr. Executive Director |
Mr. |
Min Young-Jin |
Korean |
58.8.27 |
|
|
Outside Director |
Mr. |
Kim Chung-Seob |
Korean |
42.5.15 |
|
|
Outside Director |
Mr. |
Kim Jin-Hyun |
Korean |
36.1.2 |
|
|
Outside Director |
Mr. |
Lee Kyung-Jae |
Korean |
39.1.30 |
|
|
Outside Director |
Mr. |
Cha Sun-Gak |
Korean |
42.10.3 |
- |
|
Outside Director |
Mr. |
Warren G. Lichten-stein |
- |
65.7.21 |
MBA of |
|
Outside Director |
Mr. |
Ahn Yong-Chan |
Korean |
59.1.4 |
- |
|
Outside Director |
Mr. |
Lee Yoon-Jae |
Korean |
50.11.3 |
- |
|
Outside Director |
Mr. |
Lee Chang-Woo |
Korean |
54.1.23 |
Prf. Of |
|
Outside Director |
Mr. |
Kim Kyu-One |
Korean |
45.5.12 |
Prof. of |
Financials
Unit: KRW
|
Year |
Sales |
Assets |
Net income |
|
2,262,679,644,778 |
3,668,381,302,026 |
649,678,194,741 |
|
|
2005 |
2,209,292,431,654 |
3,964,413,672,341 |
515,924,644,486 |
|
2004 |
2,653,384,827,039 |
3,885,011,669,489 |
472,299,654,921 |
|
2003 |
2,178,876,007,259 |
3,887,045,204,025 |
459,700,817,035 |
Financial Description
Unit: KRW
|
Authorized Capital |
4,000,000,000,000 |
|
Paid-Up Capital |
954,959,485,000 |
|
Total Issues Shares |
147,442,497 |
|
Balance Sheet |
|||
|
Unit : Korean Won |
01/01/2007~03/31/2007 |
As of 12/31/2006 |
As of 12/31/2005 |
|
Total Assets |
4,248,010,106,587 |
3,668,381,302,026 |
3,964,413,672,341 |
|
Current Assets |
2,159,689,060,293 |
1,602,748,530,187 |
2,032,898,309,275 |
|
-Quick Assets |
1,201,030,540,418 |
586,208,799,775 |
907,107,549,805 |
|
-Inventories |
958,658,519,875 |
1,016,539,730,412 |
1,125,790,759,470 |
|
Fixed Assets |
2,088,321,046,294 |
2,065,632,771,839 |
1,931,515,363,066 |
|
-Investment |
647,893,652,166 |
623,679,829,432 |
647,434,250,393 |
|
-Tangibles |
1,334,131,201,136 |
1,344,156,304,689 |
1,236,694,599,060 |
|
-Intangibles |
2,038,004,444 |
2,106,462,380 |
2,457,862,937 |
|
-Others |
104,258,188,548 |
95,690,175,338 |
44,928,650,676 |
|
Total Liabilities |
1,380,519,952,783 |
622,608,398,277 |
516,373,182,915 |
|
Current Liabilities |
1,097,855,600,561 |
345,846,908,816 |
301,061,183,564 |
|
Fixed Liabilities |
282,664,352,222 |
276,761,489,461 |
215,311,999,351 |
|
Capital Stock |
954,959,485,000 |
954,959,485,000 |
954,959,485,000 |
|
Capital Surplus |
340,019,653,392 |
335,413,474,647 |
300,043,274,014 |
|
Profit Surplus |
1,871,991,856,490 |
2,061,519,527,235 |
2,519,321,562,784 |
|
Capital Adjustment |
(-)318,573,366,285 |
(-)321,903,875,892 |
(-)349,884,909,256 |
|
Total Equity |
2,867,490,153,804 |
3,045,772,903,749 |
3,448,040,489,426 |
|
Liab. & Shareholder’s Equity |
4,248,010,106,587 |
3,668,381,302,026 |
3,964,413,672,341 |
|
Current
Liabilities |
1,097,855,600,561 |
345,846,908,816 |
301,061,183,564 |
|
Trade payables |
20,764,581,335 |
9,175,903,573 |
12,129,524,170 |
|
Advances from customers |
13,156,569,751 |
7,112,850,644 |
2,062,377,874 |
|
Unearned income |
658,196,558 |
915,258,631 |
792,062,550 |
|
Withholdings |
11,756,404,503 |
7,371,186,987 |
20,285,935,847 |
|
V.A.T. withholdings |
129,815,894,713 |
128,877,709,855 |
141,146,072,008 |
|
Accrued expenses |
8,522,252,344 |
6,844,907,558 |
28,308,908,324 |
|
Other payables |
133,633,037,112 |
17,873,348,481 |
13,191,249,800 |
|
Tobacco excise taxes and dues payable |
413,640,082,236 |
55,387,904,501 |
18,924,772,336 |
|
Income taxes payable |
46,196,626,009 |
112,287,838,586 |
64,220,280,655 |
|
Dividends payable |
319,711,956,000 |
- |
- |
|
Fixed
Liabilities |
282,664,352,222 |
276,761,489,461 |
215,311,999,351 |
|
Liabilities for severance benefits |
163,597,301,465 |
173,332,022,434 |
132,890,645,800 |
|
Deposits for severance benefits trust |
(-)94,638,009,078 |
(-)95,634,903,960 |
(-)77,177,235,748 |
|
Leasehold deposits received |
27,860,219,930 |
29,783,105,000 |
26,123,077,670 |
|
Deferred income tax liabilities |
107,060,099,768 |
94,797,643,191 |
77,722,086,974 |
|
Liabilities for tobacco production stabilization
fund |
78,784,740,137 |
74,483,622,796 |
55,753,424,655 |
|
Income Statement |
|||
|
Unit : Korean Won |
01/01/2007~03/31/2007 |
As of 12/31/2006 |
As of 12/31/2005 |
|
Sales |
515,470,090,296 |
2,262,679,644,778 |
2,209,292,431,654 |
|
Cost of Sold Goods |
226,014,952,062 |
979,777,908,548 |
984,654,620,570 |
|
Gross Profit |
289,455,138,234 |
1,282,901,736,230 |
1,224,637,811,084 |
|
Selling & Admin. Expenses |
133,055,813,697 |
569,172,432,892 |
547,708,770,493 |
|
Operating Income |
156,399,324,537 |
713,729,303,338 |
676,929,040,591 |
|
Non-Operating Income |
50,024,989,040 |
294,664,933,356 |
153,089,550,159 |
|
Non-Operating expenses |
21,409,483,771 |
153,413,467,965 |
121,185,182,521 |
|
Ordinary Income |
185,014,829,806 |
854,980,768,729 |
708,833,408,229 |
|
Special Income |
- |
- |
- |
|
Income Before Taxes |
185,014,829,806 |
854,980,768,729 |
708,833,408,229 |
|
Income Taxes Expenses |
54,830,544,551 |
205,302,573,988 |
192,908,763,743 |
|
Net Income |
130,184,285,255 |
649,678,194,741 |
515,924,644,486 |
|
Cash Flows |
|||
|
Unit : Korean Won |
01/01/2007~03/31/2007 |
As of 12/31/2006 |
As of 12/31/2005 |
|
Cash Flows from Operating |
622,549,658,334 |
843,777,126,970 |
498,240,324,104 |
|
-Net Income |
130,184,285,255 |
649,678,194,741 |
515,924,644,486 |
|
-Exp. without Cash Outflow |
62,895,753,610 |
227,155,521,660 |
212,521,431,094 |
|
-Revenue without Cash Inflows |
(-)48,328,483,597 |
(-)181,458,306,688 |
(-)107,068,891,959 |
|
-Changes in Asset/ & Liability |
477,798,103,066 |
148,401,717,257 |
(-)123,136,859,517 |
|
Cash Flows from Investing |
(-)120,388,466,933 |
16,093,270,977 |
(-)174,867,093,926 |
|
-Cash Inflow from Investing |
(-)1,922,885,070 |
(-)1,027,052,685,960 |
(-)328,808,745,625 |
|
-Cash Outflows for Investing |
- |
88,590,269,000 |
27,029,170,000 |
|
Cash Flows from Financing |
(-)1,922,885,070 |
(-)1,115,642,954,960 |
(-)355,837,915,625 |
|
-Cash Inflows from Financing |
500,238,306,331 |
167,182,288,013 |
(-)5,435,515,447 |
|
-Cash Outflows from Financing |
165,924,384,542 |
333,106,672,555 |
338,542,188,002 |
|
Increase/Decrease in Cash |
666,162,690,873 |
165,924,384,542 |
333,106,672,555 |
|
Cash at the Beginning of Year |
622,549,658,334 |
843,777,126,970 |
498,240,324,104 |
|
Cash at the End of Year |
130,184,285,255 |
649,678,194,741 |
515,924,644,486 |
Products,
Technologies, Services
Description
|
Main Products & Services |
Cigarette Business Health Functional Food Business Real Estate Management Investment Asset Management Brand Name: TIME, ESSE, THE ONE, THIS+,
SIMPLE, THIS |
Trade Partners
|
Suppliers |
TAE-A INDUSTRIAL CO. LTD(160111-0005185) DONG YANG CORPORATION HAUNI-Germany |
Related Parties
(Subsidiaries, Joint-
Venture &
Affiliates)
|
Affiliates |
KOREA GINSENG CORP.(160111-0083066) YUNGJIN PHARM IND CO.,LTD(110111-0043127) TAE-A INDUSTRIAL CO. LTD(160111-0005185) KGC SALES CO., LTD(110111-2859390) KOREA ISLET TRANSPLANTATION INSTITUTE,
INC.(134311-0003210) |
|
Overseas Office |
Beijing-China #510 TEL: 86-10-8453-9806 FAX: 86-10-8453-9809 Shanghai-China E1, 21Fl, TEL: 86-21-6327-0963(18) FAX: 86-21-8440-3460 TEL: 976-11-318-648 FAX: 976-11-318-756 Dereboyu Sokak Sunplaza No:24 Kat:10 34398 TEL: 90-212-276-2205 FAX: 90-212-276-2540 Graha Mustika Ratu 5th Fl, Jl. Gatot
Subroto Kav. 74-75 TEL: 62-021-830-6619 FAX: 62-021-830-6660 KT&G U.S.A. Inc |
|
Subsidiary |
Korea Ginseng Corporation (100% held by the subject company) |
Sales by Region (Activity
& Markets)
|
Sales/ Unit :Mil KRW |
2006 |
2005 |
2004 |
|
Export |
346,944 |
287,940 |
312,863 |
|
Domestic |
1,915,735 |
1,921,352 |
2,340,522 |
|
Total |
2,262,680 |
2,209,292 |
2,653,385 |
The Subject imports the raw materials from
Court Action
|
Case No. |
Court |
Plaintiff(s)/
Creditor(s)/ Applicant(s) |
Defendant(s)/
Debtor(s)/ Respondent(s) |
Cause |
Amount (KRW) |
Status |
|
|
|
Kim Ahn-Bu and Others(4) |
The Subject Company |
Claim for Damages |
100,000,000 |
2nd Round Proceeding |
|
|
|
Kim Soo-Man and Others(30) |
The Subject Company |
Claim for Damages |
307,000,000 |
2nd Round Proceeding |
|
|
|
Yoon Seok-Hyun and Others(4) |
The Subject Company |
Claim for Damages |
775,189,000 |
1st Round Proceeding |
|
|
|
Association of Directors |
The Subject Company |
Claim for Damages |
100,000,000 |
1st Round Proceeding |
|
|
|
Samsung Engineering & Others(2) |
The Subject Company |
Claim for Construction Receivables |
7,000,000,000 |
1st Round Proceeding |
And there are 10 Cases(Plaintiff(s)/ Creditor(s)/ Applicant(s)) & 2
Cases(Defendant(s)/ Debtor(s)/ Respondent(s)) in 1st Round Proceeding(11 cases)
and 2nd Round Proceeding(1 Case).
News Clipping
Shinhan Bank extends helping hand to KT&G
JoongangIlbo & Joins.com:07/04/2007
Shinhan Bank, Korea’s third-largest lender, took over 3 million shares,
or a 2 percent stake, in KT&G Corp., Korea’s only tobacco firm, signaling
Shinhan is set to offer a helping hand to the company in times of future proxy
battles.KT&G recently drew the ire of its own director, Warren
Lichtenstein, a U.S.
hedge fund manager and activist shareholder, after it spent 205.5
billion won ($223.9 million) to buy a nearly 1 percent stake in Shinhan
Financial Group, Shinhan Bank’s mother firm and Korea’s second-largest
financial company by assets.
“We are the ones who bought the shares of KT&G,” said one senior
executive of Shinhan Bank who declined to be named.
“It was part of our portfolio investment, but also a move to help each other
in times of proxy battles.”KT&G pledged to sell a portion of its treasury
shares to a third party last August when it also announced a “master business
plan” to increase dividends, buy back shares, develop idle properties and take
other measures to benefit its shareholders.
The move came after Lichtenstein became the firm’s first and only
non-Korean board member in April after he, along with investor Carl Icahn,
waged an intense proxy fight against the firm’s management.
Lichtenstein has kept a low profile on the board since then, but
signaled another round of brewing conflict with the firm’s management after he
opposed KT&G’s recent stock purchase of Shinhan Financial Group.
KT&G said on June 22 it purchased 3.5 million shares, or a 0.9
percent stake, in Shinhan.
KT&G said the unexpected move, its first investment in a financial
firm, was part of its portfolio investment, stressing the stock purchase would
make it easier for the firm to secure sources of financing and use other
financial services when it expands its biotech and other new businesses in the
future.
But many analysts and market observers speculated there must be some
“behind-the-scenes arrangement” with Shinhan to give favors to KT&G in the
future in exchange for the stock purchase.Shinhan was desperate to sell its 4.3
million shares earned from Chohung Bank in June 21, 2004 when Shinhan acquired
Chohung, since Shinhan was required by law to shed the shares within exactly
three years.
Ten days later, KT&G announced it sold 3 million of its previously
held treasury shares, worth 201.9 billion won, to “an unidentified local
investor.”“Shinhan Financial Group by law is barred from buying shares in other
firms, so Shinhan Bank instead made the purchase,” said the executive.
By Jung Ha-won Staff Writer [hawon@joongang.co.kr]
- Copyrights : JoongangIlbo & Joins.com, All rights
reserved. –
KT&G buy draws Lichtenstein’s ire
JoongangIlbo & Joins.com:06/27/2007
Steel Partners, a
Lichtenstein, who has kept a low profile since his debut as a director
of KT&G Corp.
last year, expressed strong opposition to the firm’s recent purchase of
stock in Shinhan Financial Group.
Meanwhile, the shares of Sempio Foods Company shot up yesterday amid
rumors that Steel Partners has its eye on the Korean sauce maker.
KT&G,
KT&G said in a regulatory filing that the purchase, worth 205.5
billion won ($221.9 million) and the firm’s first in a financial company, was
part of a portfolio expansion. “The stock purchase was part of our plan to
secure financing sources and other loan services more easily when we expand our
biotech and other new businesses in the future,” said Kim Tae-hoon, KT&G
spokesman.
But the move drew bile from Lichtenstein, who became the company’s first
and only non-Korean director in April last year after a fierce proxy battle.
Lichtenstein missed the board meeting on June 20 to approve the purchase
and thus did not vote.
Instead he sent an e-mail to KT&G CEO Kwak Young-kyoon to express
his opposition, Kim said.
Meanwhile, Lee Jung-in, analyst at Prudential Investment &
Securities, was suspicious about KT&G’s motive for the investment, saying
the firm, with rich cash reserves and stellar performance for the past several
years, will have many suitors lined up as soon as it starts shopping for loans.
“KT&G had no reason to buy the shares at this point, while Shinhan was the
one desperate to sell the shares,” she said. Shinhan, which acquired Chohung
Bank in June 2004, is required by law to shed 4.3 million shares that
previously belonged to Chohung but later became Shinhan shares.
The deadline to drop the shares was June 21.
“But KT&G is no sucker given its past smart business strategies and
performance, so I suspect there may be some behind-the-scenes arrangement from
Shinhan to give favors to KT&G in the future, in exchange for the stock
purchase,” Lee said.
Meanwhile,
The share price of Sempio jumped 14.7 percent yesterday.
But Steel Partners denied the report, saying the firm “has not entered
into formal discussion with any party related to the acquisition of shares of
Sempio.” By Jung Ha-won Staff Writer [hawon@joongang.co.kr]
- Copyrights : JoongangIlbo &
Joins.com, All rights reserved. -
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit consideration.
Capability to overcome financial difficulties seems comparatively below
average/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a
composite of weighted scores obtained from each of the major sections of this
report. The assessed factors and their relative weights (as indicated through
%) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)