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Chinese activist asks court for Yuan250

| July 21, 2014

Li Enze, who is suing a Chinese tobacco manufacturer and a Beijing supermarket for Yuan250, has vowed to fight on despite having lost on Friday the second round of his battle, according to a story by Zhuang Pinghui for the South China Morning Post.

Li is suing China Tobacco Jiangxi Industrial and a Beijing supermarket that sold him a 10-pack carton of Jinsheng cigarettes in March last year.

He is seeking Yuan250, or about twice the price of the carton; arguing that a claim that the low-tar cigarettes with Chinese herbs were a safer option than were regular cigarettes amounted to false advertising.

After losing his initial case, Li filed an appeal to a Beijing court. But on Friday the Beijing court upheld the lower court’s ruling.

Li said that he would not give up: that he would apply to the Beijing High Court and, if necessary, the Supreme Court.

But even getting the initial case heard was said to have been unprecedented. It was the first time a claim against a tobacco company had been accepted by a mainland court. All previous attempts had failed.

“I was told the case was accepted as a usual commercial fraud case,” Li was quoted as saying. “It was too late by the time they realized it was a case for tobacco control. I was told it might not be easy to get such a lawsuit accepted by a court in Beijing again.”

Li is also suing the State Tobacco Monopoly Administration for failing satisfactorily to release information about its tobacco-control efforts over the past 10 years. The case was rejected by the Beijing No 1 Intermediate People’s Court last year, but the Beijing Higher People’s Court ruled it should be heard.

Personal tobacco import levels to be cut

| July 21, 2014

The French Senate on Thursday voted to lower the quantity of tobacco that an individual can be in possession of when entering France from another EU country, making the amount equal to that prescribed in the EU directive, according to a story in Le Figaro.

The new rules are due to come into force after a vote on the second reading.

Assuming they do come into force, the individual limits will be for 800 cigarettes, 400 cigarillos, 200 cigars, or 1 kg of tobacco.

Currently, the limits are for 2,000 cigarettes, 1,000 cigars or cigarillos, and 2 kg of tobacco.

Lorillard to release second quarter results

| July 21, 2014

Lorillard said on Friday that it would release its second quarter 2014 results on July 30, before the market opened.

A news release would be made available under the Investor Relations section of Lorillard’s website at www.lorillard.com.

PMI’s second-quarter cigarette volume increased by 2.4 per cent in EU

| July 18, 2014

Philip Morris International’s cigarette shipment volume during the second quarter to the end of June, at 222,801 million, was down by 2.7 per cent on that of the second quarter of 2013, 228,899 million.

Volume was increased in the EU by 2.4 per cent to 49,913 million, but down in the rest of the company’s regions: by 1.0 per cent to 23,065 million in Latin America & Canada (LAC); by 2.8 per cent to 74,170 million in Eastern Europe, Middle East & Africa (EEMEA); and by 6.1 per cent to 75,653 million in Asia.

PMI’s solid performance in the EU was said to have been driven by sales in Germany, Italy and the UK, partly offset by those in France, Greece and Hungary.

Total cigarette shipments of Marlboro were up by 1.0 per cent to 73.2 billion, while those of L&M fell by 3.5 per cent to 24.2 billion. Cigarette shipments of Bond Street decreased by 4.0 per cent to 11.1 billion; those of Philip Morris decreased by 11.1 per cent to 7.8 billion; those of Parliament increased by 7.6 per cent to 12.4 billion; those of Chesterfield increased by 33.2 per cent to 11.8 billion; and those of Lark decreased by 13.1 per cent to 6.9 billion.

PMI’s shipment volume of Other Tobacco Products (OTP), in cigarette equivalent units, increased by 4.2 per cent, while shipment volume for cigarettes and OTP in cigarette equivalents decreased by 2.4 per cent.

Reported diluted earnings per share during the second quarter, at $1.17, were down by 10.0 per cent on those of the second quarter of 2013, while adjusted diluted earnings per share, at $1.41, were up by 8.5 per cent.

Reported net revenues, excluding excise taxes, were down by 1.5 per cent to $7.8 billion and reported operating income was down by 13.9 per cent to $2.9 billion.

“As we expected, we achieved strong fundamental results in the second quarter, driven by a lower volume decline, strong pricing and robust market share,” said CEO André Calantzopoulos.

“For the second half of this year, we anticipate more challenging quarterly comparisons, particularly in the fourth quarter – which, in 2013, saw currency-neutral adjusted diluted earnings per share grow by 19.4 per cent – due to known business challenges, particularly in Asia, the timing of investments behind the commercialization of our Reduced-Risk Products and the roll-out of Marlboro Red 2.0, as well as costs related to our manufacturing footprint optimization initiatives.

“We are today reaffirming our 2014 full-year reported diluted EPS guidance. As previously communicated, down-trading and heavy price discounting at the low end of the market in Australia, in combination with the impact of plain packaging, could place us at the lower end of our guidance for currency-neutral adjusted diluted EPS growth of six per cent-eight per cent for the full year.”

Meanwhile, PMI’s cigarette volume shipments during the six months to the end of June, at 418,762 million, were down by 3.5 per cent on those of the first six months of 2013, 433,846 million.

Shipments were down in all of the company’s regions: by 0.1 per cent to 91,618 million in the EU; by 2.8 per cent to 44,514 million in LAC; by 4.4 per cent to 146,454 million in Asia; and by 4.9 per cent to 136,176 million in the EEMEA.

Turkey to crack down harder on smokers

| July 18, 2014

Turkey, which already bans tobacco smoking in enclosed public places, plans to impose further restrictions on where its citizens may smoke, according to a Daily Sabah story.

Existing legislation bans smoking in restaurants and cafés but, up to now, people have been allowed to smoke in outdoor areas of such premises.

Now, under new measures to be brought in under the Ministry of Health’s 2014-18 tobacco control program, restaurant and café owners will have to set up separate outdoor areas for smokers and non-smokers.

The ministry will ban smoking also within a stipulated distance of the entrance to premises where smoking is prohibited.

And it will ban smoking from some outdoor areas open to the public, including playgrounds and the courtyards of schools and mosques.

Under the new control program, smoking, which is already banned on public transportation, will be prohibited in private vehicles carrying pregnant women or children.

The ministry has promised to make more frequent the inspections of tobacco outlets, so as to crack down on  sales to people under the age of 18, and it will introduce a ban on cigarette sales in shops in ‘close proximity’ to schools.

The Minister of Health Mehmet Müezzinoğlu was quoted as saying the regulations would be adopted ‘as soon as possible’.

“Cigarette is the first step to bad habits for most consumers of alcoholic beverages and drug users,” he said. “So, we aim to curb smoking rates first.”

SM’s sales up in second quarter

| July 18, 2014

Swedish Match’s sales during the second quarter to the end of June, at SEK3,339 million, were up by four per cent on those of the second quarter of 2013, SEK3,220 million.

But operating profit, excluding SM’s share of net profit from the Scandinavian Tobacco Group (STG) and larger one-off items, fell by one per cent to SEK941 million, while operating profit including SM’s share from the STG and larger one-off items, fell by 2.8  per cent to SEK941 million.

Basic earnings per share were down by 2.0 per cent to SEK3.27.

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