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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.

Proposed Lorillard acquisition suggests FDA unlikely to ban use of menthol

| July 18, 2014

A leading US health expert has said that the proposed acquisition of Lorillard by Reynolds American is an indication that the latter is confident the Food and Drug Administration will not be pressured by politicians into banning menthol.

Writing on his Rest of the Story blog, Dr. Michael Siegel, who is a professor in the Department of Community Health Sciences, Boston University School of Public Health, said that for several months a group of Democratic senators had been blasting the e-cigarette industry for using flavors in its products.

This group of senators had called for a ban on flavorings in e-cigarettes, supposedly because of their sincere interest in curtailing “marketing tactics aimed at luring children and teenagers into … nicotine addiction”.
‘The Rest of the Story has called their bluff, pointing out that what these senators really mean is that they want to stop tactics (flavored e-cigarettes) aimed at luring children into fake cigarette addiction, but not tactics (flavored cigarettes) that are aimed at luring children into actual cigarette addiction,’ said Siegel.

‘These same senators either supported the menthol exemption to the flavored cigarette ban and/or have failed to introduce or sponsor legislation that would ban menthol flavoring from cigarettes.’

The full story is at: http://tobaccoanalysis.blogspot.co.uk/2014/07/acquisition-of-lorillard-demonstrates.html.

RAI declares quarterly dividend

| July 18, 2014

Reynolds American’s board of directors yesterday declared a quarterly cash dividend on the company’s common stock of $0.67 per share ($2.68 per share annualized).

The dividend is payable on October 1 to shareholders of record on September 10.

In making the dividend announcement, RAI said that it was the 41st consecutive quarterly cash dividend that the company had declared since it became a public company on July 30, 2004.

‘RAI’s policy is to return about 80 per cent of the company’s current-year net income to shareholders in the form of dividends,’ the company said.

Policies plainly not working in England

| July 17, 2014

Conservative candidates in marginal seats, including public health minister, Jane Ellison, risk electoral defeat because of the government’s nanny state policies, according to a new survey* of English voters commissioned by the Democracy Institute, which describes itself as a politically independent think tank.

Conducted before and after this week’s cabinet reshuffle, the poll was said to have found tepid Tory support in much of England, especially in regions containing the most marginal seats. Conservative candidates continued to be threatened by a relatively popular UKIP, a second choice for a growing number of voters.

“These results suggest UKIP’s outspoken opposition to many of the government’s public health proposals has the potential to shift, in small but critical ways, the electoral sands,” said Patrick Basham, who directed the survey.

“David Cameron’s tenuous hold on the keys to No 10 is threatened, in part, by voters who tell us they’re tired of government telling them what, how, and when they should eat, drink, and smoke,” added Basham, who has conducted campaign and policy polls in the UK, East Africa, Australia, North America, and the Middle East.

The poll found that a majority of voters – 54 per cent to 38 per cent – opposed the introduction of plain cigarette packaging. And it found that a plurality of voters (42 per cent) was less likely to vote for a party that supported plain packaging. More than two-thirds (68 per cent) feared that plain packaging would encourage smuggling, and one-third (34 per cent) of smokers admitted that plain packaging would make them more likely to buy their cigarettes on the illicit market.

Meanwhile, a majority (51 per cent) thought the tobacco industry made a negative contribution to the economy, while 53 per cent said the industry also played a negative societal role.

“Our poll surprisingly finds plain packaging’s as unpopular as the tobacco industry itself,” said Basham. “While Big Tobacco remains a political pariah, plain packaging could prove an electoral albatross, in tandem with other nanny state-style initiatives, weighing down the Conservative vote.”

*The fieldwork for the survey of a randomly selected national telephone (landline and mobile) sample of 1,050 English voters (including 500 voters in marginal seats) was conducted by the Democracy Institute’s polling unit from July 9 to 11 and July 14 to 15, 2014.

The national poll has a margin of error of +/- 3% (95% confidence interval). The sub-sample of marginal seats has a margin of error of +/- 4% (95% confidence interval). The sub-sample of smokers has a margin of error of = +/- 6.5% (95% confidence interval).

To ensure a representative sample, the results were weighted for key demographic variables including, but not limited to, gender, age, education, income, region, and mobile phone-only households.

Only 12.8 per cent of Australians smoking

| July 17, 2014

According to a US Campaign for Tobacco-free Kids story, Australian health officials yesterday reported that Australia’s smoking rate had dropped by more than 15 per cent – from 15.1 per cent in 2010 to 12.8 per cent in 2013 – ‘following the implementation of a landmark law requiring that cigarettes be sold in plain packaging’.

And a story by Harriet Alexander for The Age reporting the same drop in the incidence of smoking seemed to make the point that the smoking decrease had coincided with the introduction of standardized tobacco packaging laws.

Standardized tobacco packaging was introduced in Australia on December 1, 2012.

Geoff Neideck of the Australian Institute of Health and Welfare, which conducts the survey (National Drugs Strategy Household Survey) every two to three years, was quoted in The Age as saying that the results continued a longer trend that had seen smoking rates halved since 1991.

Threat to single cigarette sales in India

| July 17, 2014

The Indian Health Ministry is considering whether it should ban the sale of single cigarettes, according to a story in the latest issue of the BBM Bommidala newsletter.

In fact, such a ‘ban’ might be a case of enforcing one already in place since the ministry said the country’s Tobacco Act prohibited the sale of any tobacco products not in a package incorporating mandatory health warnings and tar- and nicotine-delivery information.

The ministry said that single-stick sales provided an added attraction for underage people and the poor, who could not afford to buy cigarettes by the pack.

If the Indian government doesn’t act, the government of the Indian state of Himachal Pradesh might. It, too, is considering banning the sale of single cigarettes,

The Health and Family Welfare Minister, Kaul Singh Thakur, said cigarettes sold by the stick did not carry health warnings and were often bought by school and college students who could not afford to buy full packs.

Meanwhile, the state is planning to increase the VAT on cigarettes from the existing 36 per cent to 50 per cent.

Last year, VAT was increased on cigarettes and cigars from 18 per cent to 36 per cent, and on bidis from 11 per cent to 22 per cent.

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