MIRA INFORM REPORT

 

 

Report Date :

16.06.2011

 

IDENTIFICATION DETAILS

 

Name :

KT&G CORPORATION

 

 

Registered Office :

100, Pyeongchon-dong, Daedeok-gu, Daejeon, Korea

 

 

Country :

South Korea

 

 

Financials (as on) :

31.03.2011

 

 

Date of Incorporation :

01.04.1987

 

 

Com. Reg. No.:

160111-0067804

 

 

Legal Form :

Listed Company

 

 

Line of Business :

Manufacture of Tobacco Products

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Status :

Satisfactory

Payment Behaviour :

No complaints

Litigation :

Exists

 

NOTES :

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – March 31st, 2010

 

Country Name

Previous Rating

(31.12.2010)

Current Rating

(31.03.2011)

South Korea

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

Basic

 

Company Name

KT&G CORPORATION

(Korean Company Name : “(주)케이티앤지”)

Registered Address

100, Pyeongchon-dong, Daedeok-gu, Daejeon, Korea

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

Kosmo Tower 19FL., 1002, Daechi-dong Gangnam-gu, Seoul, Korea

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

Min Young-Jin

Date of Birth

08/27/1957

Title

President & CEO

Sex

Male

Nationality

Korean

 

 

Profiles

 

Capital (KRW)

954,959,485,000

Employees

4,178

Formation

Listed Company (Korea Stock Exchange: 033780) as of 10/08/1999

Listed Company(Luxembourg Stock Exchange-Euro MTF) as of 10/31/2001

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

Name

Shares

%

INDUSTRIAL BANK OF KOREA(110135-0000903)

9,510,485

6.85

EMPLOYEE STOCK OWNERSHIP ASSOCIATION

5,660,022

4.08

TREASURY STOCK

10,707,398

7.71

LAZARD ASSET MANAGEMENT LLC(30 ROCKEFELLER PLAZA, NEW YORK,NY 10112, U.S.A.)

9,871,677

7.11

OTHERS

105,081,514

75.71

TOTAL

138,792,497

100.00

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 Korea IR Grand Prize

11/24/2006 Awarded the 6th Korea IR Grand Prize

 

 

 

 

Management

 

Job Description

Title

Name

Nationality

Date of Birth

Education

President & CEO

Mr.

Min Young-Jin

Korean

1958.08.27

Kunkuk University, Korea

Outside Director

Mr.

Ahn Yong-Chan

Korean

1959.01.04

Yonsei University, Korea

Outside Director

Mr.

Lee Yoon-Jae

Korean

1950.11.03

Seoul National University, Korea

Outside Director

Mr.

Kim Won-Yong

Korean

1954.02.16

Sungkyunkwan University, Korea

Outside Director

Mr.

Kim Deuk-Hui

Korean

1947.11.18

Kunkuk University, Korea

Outside Director

Mr.

Ji Seung-Rim

Korean

1949.01.23

Youngnam University, Korea

Outside Director

Mr.

Cho Kyu-Ha

Korean

1951.03.08

Korea University, Korea

Outside Director

Mr.

Lee Wang-Jae

Korean

1955.04.24

Seoul National University, Korea

Outside Director

Mr.

Kim Jung-Sik

Korean

1955.10.27

Korea Aviation University

Outside Director

Mr.

Jung Young-Ki

Korean

1958.11.17

Sungkyunkwan University, Korea

 

 

Financials

 

Year / Unit : KRW

Sales

Assets

Net Income

(*)03/2011

537,031,875,481

5,404,846,420,414

199,211,304,445

(*)2010

2,499,931,396,350

5,253,774,633,584

931,126,723,092

(*)2009

2,776,403,229,547

4,787,804,665,393

744,942,359,818

(*)2008

2,573,142,394,510

4,613,384,480,450

849,486,156,323

2007

2,412,688,859,117

3,977,801,296,461

661,205,876,222

2006

2,262,679,644,778

3,668,342,959,976

649,690,975,423

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

(*)03/2011, 2010, 2009 and 2008’s figures are based on the IFRS Accounting System.

 

Financial Description

 

Authorized Capital(KRW)

4,000,000,000,000

Paid-Up Capital(KRW)

954,959,485,000

Total Issues Shares

137,292,497

 

 

Balance Sheet

 

Unit : Korean Won

01/01/2011~03/31/2011

As of 12/31/2010

As of 12/31/2009

Total Assets

5,404,846,420,414

5,253,774,633,584

4,787,804,665,393

Current Assets

2,684,944,123,038

2,532,643,737,596

2,035,820,319,595

Inventories

977,390,212,642

990,333,245,145

1,054,321,125,128

Trade Receivables & Other Receivables

586,844,272,254

535,316,574,980

517,902,347,732

Prepaid Taxes

222,771,481,730

177,043,144,767

169,440,447,325

Other Current Finance Assets

999,999,000

999,999,000

1,956,835,000

Cash & Cash Equivalents

891,227,634,086

828,950,773,704

268,953,901,434

Other Non-Current Assets

5,710,523,326

0

23,245,662,976

Non-Current Assets

2,719,902,297,376

2,721,130,895,988

2,751,984,345,798

Tangibles

1,160,763,860,906

1,196,126,132,064

1,210,425,812,871

Intangibles

45,759,939,822

48,563,676,665

45,041,298,735

Investment_Real Estates

123,265,353,621

98,143,451,701

101,899,942,480

Investment_Subsidiaries

872,850,925,649

842,950,925,649

723,159,568,435

Other Non-Current Finance Assets

406,104,467,095

446,350,192,059

559,964,279,494

Long-Term Trade Receivables & Other Receivables

111,157,750,283

88,996,517,850

111,493,443,783

Total Liabilities

1,264,545,912,746

916,088,682,154

934,811,761,961

Current Liabilities

1,110,322,031,594

770,587,425,025

769,569,824,601

Short-Term Borrowings

7,883,378,693

8,617,590,926

19,337,620,219

Trade Payables & Other Payables

739,372,051,167

246,298,033,664

300,144,139,829

Accrued Income Tax

41,301,813,683

190,814,815,690

100,038,268,192

Other Accrued Tax

321,764,788,051

324,856,984,745

350,049,796,361

Non-Current Liabilities

154,223,881,152

145,501,257,129

165,241,937,360

Long-Term Trade Payables & Other Payables

25,529,726,980

23,417,226,383

24,575,857,007

Provision for Severance & Retirement

34,181,599,737

28,774,058,315

18,294,502,065

Deferred Income Tax Credit

94,512,554,435

93,309,972,431

122,371,578,288

Capital Stock

954,959,485,000

954,959,485,000

954,959,485,000

Others

2,983,928,234,857

2,453,586,804,612

2,318,069,409,418

Profit Surplus

201,412,787,811

929,139,661,818

579,964,009,014

Total Equity

4,140,300,507,668

4,337,685,951,430

3,852,992,903,432

Liab. & Shareholder’s Equity

5,404,846,420,414

5,253,774,633,584

4,787,804,665,393

 

 

Income Statement

 

Unit : Korean Won

01/01/2011~03/31/2011

As of 12/31/2010

As of 12/31/2009

Sales

537,031,875,481

2,499,931,396,350

2,776,403,229,547

Cost of Sold Goods

201,262,431,578

1,002,185,302,526

1,154,944,297,691

Gross Profit

335,769,443,903

1,497,746,093,824

1,621,458,931,856

Other Operating Income

9,211,410,598

130,197,409,796

51,394,924,862

Selling & Admin. Expenses

138,525,502,354

631,149,159,985

611,223,442,221

Other Operating Expenses

17,146,649,829

62,313,343,356

105,083,371,796

Operating Income

189,308,702,318

925,016,000,279

946,547,042,701

Finance Income

61,229,005,896

296,857,225,944

41,607,183,739

Finance Expenses

4,005,989,746

1,767,495,381

2,806,046,680

Income Before Taxes

246,531,718,468

1,220,105,730,842

985,348,179,760

Income Taxes Expenses

47,320,414,023

288,979,007,750

240,405,819,942

Net Income

199,211,304,445

931,126,723,092

744,942,359,818

 

 

Cash Flows

 

Unit : Korean Won

01/01/2011~03/31/2011

As of 12/31/2010

As of 12/31/2009

Operating Activities Cash Flows

89,076,364,508

715,468,313,826

747,674,362,871

Cash Flows from Operating

172,328,362,612

916,063,069,748

1,034,123,935,824

Income Taxes

-83,251,998,104

-200,594,755,922

-286,449,572,953

Cash Flows from Investing

-28,756,424,127

173,489,943,328

-101,753,902,979

Cash Flows from Financing

2,117,911,000

-328,925,651,050

-465,288,413,785

Increase/Decrease in Cash

828,950,773,704

268,953,901,434

88,351,606,837

Cash at the Beginning of Year

-160,990,999

-35,733,834

-29,751,510

Cash at the End of Year

891,227,634,086

828,950,773,704

268,953,901,434

 

 

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 & Competitors

 

Suppliers

TAE-A INDUSTRIAL CO., LTD.(160111-0005185)

DONG YANG CORPORATION(KOREA)

LOTTE ALUMINUM CO., LTD.(110111-0003121)

HAUNI(GERMANY)

PDM(FRANCE)

Customers

ALOKOZAY INTERNATIONAL LIMITED

Competitors

BRITISH AMERICAN TOBACCO KOREA LIMITED

42TH FL., GANGNAM FINANCE CENTER, 737, YEOKSAM 1-DONG, GANGNAM-GU, SEOUL, KOREA

TEL:+82-2-2112-7100  FAX:+82-2-2112-7109

 

PHILIP MORRIS KOREA INC.

24TH FL., SEOUL FINANCE BLDG., 84, TAEPYEONGNO 1-GA, JUNG-GU, SEOUL, KOREA

TEL:+82-2-3707-0700  FAX:+82-2- 775 -9780

 

SAMYANG INTERNATIONAL CO., LTD.

3RD FL., BOHEON BLDG., 84-2, JAE-DONG, JONGNO-GU, SEOUL, KOREA

TEL:+82-2-3670-9600  FAX:+82-2-764-9120

 

 

 

 

 

 

 

 

 

Related Parties (Subsidiaries, Joint-Venture & Affiliates)

 

Affiliates

TAE-A INDUSTRIAL CO. LTD(160111-0005185)

KT&G HONG KONG CO., LTD.

KT&G TUTUN MAMULLERI SANAYIVE TICARET A.S.(TURKEY)

KOREA TABOCOS DO BRASIL LTDA

KT&G PARS(IRAN)

KT&G RUS L.L.C

JUNGKWANJANG KOBIN CO., LTD.(CHINA)

KOREAN RED GINSENG CORP. INC.

JUNGKWANJANG 6-YEAR COMMERCIAL(SHANGHAI) CO., LTD.(CHINA)

Overseas Office

BEIJING-CHINA

#510 SHENGSHI BUILDING NO. 38 XIAOYUN ROAD, CHAOYANG DIST. BEIJING 100027, P.R . CHINA

TEL: 86-10-8453-9806  FAX: 86-10-8453-9809

 

SHANGHAI-CHINA

E1, 21FL, ZAOFENG HUANQIU BUILDING, 1800 WEST ZHONGSHAN ROAD SHANGHAI 200235, P.R. CHINA

TEL: 86-21-6327-0963(18)  FAX: 86-21-8440-3460

 

MONGOLIA (KT&G MOGOLIA LLC)

#408 ORIENT PLAZA ENKHATAVIAN STREET SUKHBAARTAR DISTRICT ULAANBAATAR MONGOLIA

TEL: 976-11-318-648  FAX: 976-11-318-756

 

TURKEY (KT&G TURKEY)

DEREBOYU SOKAK SUNPLAZA NO:24 KAT:10 34398 MASLAK-ISTANBUL TURKEY

TEL: 90-212-276-2205  FAX: 90-212-276-2540

 

INDONESIA

GRAHA MUSTIKA RATU 5TH FL, JL. GATOT SUBROTO KAV. 74-75 JAKARTA 12870 INDONESIA

TEL: 62-021-830-6619   FAX: 62-021-830-6660

 

KT&G U.S.A. INC

Subsidiary

KOREA GINSENG CORP.(160111-0083066)

(100.0% held by the subject company)

 

YUNGJIN PHARM IND CO., LTD.(110111-0043127)

(55.5% held by the subject company)

 

TAE-A INDUSTRIAL CO., LTD.(160111-0005185)

(100.0% held by the subject company)

 

KGC SALES CO., LTD.(110111-2859390)

(100.0% held by the subject company)

 

KT&G BIO CORPORATION(110111-4184472)

(100.0% held by the subject company)

Cooperative Enterprise

-Insured Company

DONGBU INSURANCE CO., LTD.(110111-0095285)

 

 

Sales by Region (Activity & Markets)

 

Sales/ Unit :Mil KRW

03/2011

2010

2009

Export

135,327

621,889

569,764

Domestic

401,704

1,878,042

2,206,639

Total

537,032

2,499,931

2,776,403

The Subject imports the raw materials from USA and Brazil. And it exports to Middle East, Central Asia, CIS, USA, South-East Asia, China and others.

 

 

Court Action

 

Case No.

Court

Plaintiff(s)/ Creditor(s)/ Applicant(s)

Defendant(s)/ Debtor(s)/ Respondent(s)

Cause

Amount (Million KRW)

Status

 

Busan District Court

The Subject Company

Kim Jin-Sang & Others(1)

Transferring land

11

2nd Round is Proceeding.

 

Seoul Central District Court

The Subject Company

Samsung Engineering Co., Ltd., & Others(1)

Claim for Compensation

5,099

1st Round is Proceeding.

 

Patent Court

The Subject Company

Damin Biotec Co., Ltd.

Nulifying Registration

50

1st Round is Proceeding.

 

Cheonju District Court

The Subject Company

Choenju City

Transferring Ownership

9,593

1st Round is Proceeding.

 

Seoul Nambu District Court

The Subject Company

Jenico Food Co., Ltd.

Claim for Compensation

564

1st Round is Proceeding.

 

Seoul High Court

Yoon Ji-Hyun & Others(3)

The Subject Company

Claim for Compensation

177

2nd Round is Proceeding.

 

Seoul High Court

Kim Soo-Man & Others(27)

The Subject Company

Claim for Compensation

307

2nd Round is Proceeding.

 

Seoul Central District Court

Yoon Seok-Hyun & Others(4)

The Subject Company

Claim for Compensation

175

1st Round is Proceeding.

 

Seoul Central District Court

Management Team & Others(1)

The Subject Company

Claim for Compensation

100

1st Round is Proceeding.

 

Seoul Central District Court

Hana Development Consulting Co., Ltd.

The Subject Company

Receivables

100

1st Round is Proceeding.

 

Supreme Court

Damin L&T Co., Ltd.

The Subject Company

 Infringement on Patent Right

-

3rd Round is Proceeding.

 

Daejeon District Prosecutors' Office

Daejeon District Prosecutors' Office

The Subject Company

 Infringement on Patent Right

-

Pending

 

Daejeon High Court

Damin L&T Co., Ltd.

The Subject Company

 Infringement on Patent Right

-

1st Round is Proceeding.

 

Patent Court

Damin Biotec Co., Ltd.

The Subject Company

Others

50

1st Round is Proceeding.

 

Patent Court

Damin Biotec Co., Ltd.

The Subject Company

Others

50

1st Round is Proceeding.

 

Chuncheon District Court

Kim Mi-Young

The Subject Company

Others

500

1st Round is Proceeding.

 

Busan District Court

The Subject Company

Kim Jin-Sang & Others(1)

Transferring land

11

2nd Round is Proceeding.

There are 3 cases filed as Plaintiff(s)/ Creditor(s)/ Applicant(s) amounting 5,593,000,000 KRW, and 6 cases filed as Defendant(s)/ Debtor(s)/ Respondent(s) amounting 4,273,000,000 KRW.

 

 

News Clipping

 

---

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.44.68

UK Pound

1

Rs.73.04

Euro

1

Rs.64.29

 

 

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

Capability to overcome financial difficulties seems comparatively below average.

 

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

--

NB

                                       New Business

 

--

 

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%)

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.