SM envisions world without cigarettes
Swedish Match’s new vision is: A world without cigarettes.
In announcing the company’s third quarter results to the end of September, CEO, Lars Dahlgren, said the availability and accessibility of SM’s high quality snus explained the uniquely low cigarette consumption in Sweden.
“In Norway, we are now witnessing a similar trend of migration from cigarettes to snus,” he said.
“With our heritage and deep experience and expertise in developing, producing and marketing quality products, Swedish Match is distinctly positioned to compete in and further develop the growing snus category while contributing significantly to improved public health.
“To further emphasize the company strategy and prospects we have during the quarter reformulated our vision. Our new company vision is ‘A world without cigarettes’.
“We create shareholder value by offering tobacco consumers enjoyable products of superior quality in a responsible way.
“By providing products that are recognized as safer alternatives to cigarettes, we can contribute significantly to improved public health.”
Later in his statement, Dahlgren noted that, on August 25, the US Food and Drug Administration had announced that Swedish Match’s Modified Risk Tobacco Product (MRTP) applications for its General snus line of products sold in the US were ‘complete’ and that they were being made publicly available for comments. SM, he said, had thereby become the first company to have an MRTP application accepted as complete by the FDA.
Turning to the company’s results, Dahlgren said that SM had reported increased sales and operating profit in the third quarter compared to those of the third quarter of 2013.
“The strongest growth came from the product area ‘other tobacco products’, which includes cigars and chewing tobacco.
“We also reported sales and operating profit growth within our snus and moist snuff product area. For snus and moist snuff, the operating profit comparison benefits from the non-recurrence of restructuring costs charged in the prior year’s third quarter.
“Underlying operating profit in local currencies also increased when excluding the effects of last year’s restructuring charges and international snus investments from both years.”
Sales for the third quarter increased by six percent to SEK3,416 million, from SEK3,230 million during the third quarter of 2013. In local currencies, sales increased by three percent.
Operating profit from product areas, which excludes the share of net profit from the Scandinavian Tobacco Group (STG) and larger one-off items, increased by five percent during the third quarter from SEK836 million to SEK874 million, and by two percent in local currencies.
Operating profit from product areas was up by two percent in local currencies also when adjusted for increased costs related to international snus and restructuring charges in 2013.
Operating profit, which includes the share of net profit in STG and larger one-off items, was up by seven percent from SEK924 million to SEK989 million.
Basic earnings per share increased by 11 percent from SEK3.15 to SEK3.50.