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UK plain packaging plan goes up in smoke

| May 2, 2013

U.K. Prime Minister David Cameron has scrapped plans to force all cigarettes to be sold in plain packs, according to a story published today in The Sun.

Health ministers had been considering the move for a year. Proponents had insisted making packages bland would put smokers off — and stop kids from picking up the habit.

Cameron initially backed the plan, but has been persuaded it would damage the packaging industry. There were also concerns it could cost £3 billion in lost tax revenue and tie up the Commons in bitter arguments.

Cameron has now ordered the proposed law to be pulled from next week’s Queen’s Speech.

A Whitehall source said: “Plain packaging may or may not be a good idea, but it’s nothing to do with the government’s key purpose. The PM is determined to strip down everything we do so we can concentrate all our efforts on voters’ essentials. That means growth, immigration and welfare reform.”

Officials in Australia, the first to enforce uniform packaging, have admitted there was still no evidence that they cut smoking.

Japan Tobacco tops competition, forecast beats estimates

| April 25, 2013

Japan Tobacco, the world’s best-performing cigarette maker this year, forecast a record profit that beat analyst estimates and raised its projected annual dividend by 35 percent on rising overseas sales and a weaker yen, according to Bloomberg News.

Net income will probably be ¥415 billion ($4.2 billion) for the year ending March 2014, the Tokyo-based company said today in a statement. The outlook is higher than the ¥412 billion average of 18 analyst estimates compiled by Bloomberg.

Japan Tobacco, which aims to make its Mevius the No. 1 global premium brand, is benefiting as a weaker yen boosts the value of overseas revenue, which accounted for about 48 percent of the company’s total in the last fiscal year. Asia’s biggest listed cigarette maker also said it would raise its payout ratio to 50 percent by fiscal 2015, one year earlier than previously planned, to support shareholders.

BAT sales up 5 pct, driven by global brands

| April 25, 2013

British American Tobacco reported revenue growth of 5 percent at constant rates of exchange in the first quarter ended March 31, adding that global drive brand cigarette volumes grew by 1 percent.

The report stated:

  • Revenue growth of 1 percent at current rates of exchange.
  • Cigarette volumes from subsidiaries fell 3.7 percent to 160 billion, with a decrease of 3.4 percent for total tobacco volumes.
  • Board confident of another year of earnings growth in line with long term strategic goals.
  • Pricing environment remains strong despite difficult trading conditions in many parts of the world, notably southern Europe.
  • If current exchange rates persist for the rest of the year, the currency headwind that adversely impacted the quarter will reverse.
  • Group has sufficient financing and facilities available for the foreseeable future.
  • There have been no material events, transactions or changes in the financial position of the Group since the year end.
  • -Shares closed Wednesday at 3548 pence valuing the company at £68.25 billion.

Altria plans e-cig sales, Marlboro demand falls

| April 25, 2013

Altria Group, the largest seller of tobacco in the U.S., plans to introduce an e-cigarette this year, chasing smaller rivals as demand for traditional smokes declines.

The e-cigarette will be sold in an undisclosed market starting in the second half of 2013, Richmond, Virginia-based Altria said today in a statement. The company declined to provide additional information until a conference call with analysts today, according to a story in Bloomburg News.

CEO Martin Barrington is trying to catch up to smaller rivals such as closely held NJOY and Lorillard Inc., which says its Blu e-cigs brand controls more than 40 percent of the U.S. market. Reynolds American Inc. said this week it plans to expand its Vuse e-cigarette this year.

First-quarter cigarette shipments fell at Altria, Winston-Salem, North Carolina-based Reynolds and Greensboro, North Carolina-based Lorillard. Altria’s U.S. volume tumbled 5.2 percent, with top-selling Marlboro slipping 5.5 percent.

Lorillard CEO Murray Kessler told analysts yesterday the company estimates that e-cigarette sales displaced consumption of about 600 million cigarettes in the first quarter. That translates to an annual rate of about 2.4 billion cigarettes, accounting for about 1 percent of the U.S. market, according to Kenneth Shea, a Bloomberg Industries analyst in Skillman, New Jersey.

IMHA urges brand protection

| April 25, 2013

The trade body representing the global hologram industry is urging organisations to review and if necessary redouble their brand protection and authentication strategies to stem the “hemorrhage” of counterfeit goods flowing out of china.

That’s the stark message from the International Hologram Manufacturers Association (IHMA) which was commenting on a new UN report that says a staggering 75 percent of all the fake goods seized worldwide between 2008 and 2010 came from China.

According to the UN Office on Drugs and Crime (UNODCO), these counterfeit goods make up almost 2 percent of global trade while organized crime groups, who deal in fake goods and drugs among other items, are pocketing $90 billion annually across the Far East region.

The Transnational Organised Crime in East Asia and the Pacific: A Threat Assessment is the most comprehensive study yet on the subject.

The report is a sobering reminder that the war on counterfeiting is far from over, says the IHMA, and will be a wake-up call for those desperate to protect brands and profits not only in the Far East but worldwide.

UK campaigners condemn ‘sexist’ study on plain packaging

| April 25, 2013

Campaigners in the U.K. opposed to plain packaging of tobacco have described as “sexist” a study that says young female smokers get less satisfaction and less enjoyment from smoking cigarettes that come in plain, standardized packs.

Hands Off Our Packs campaigner Angela Harbutt, a smoker, said, “The idea that plain packaging will have a greater impact on young women suggests that women are more easily influenced than men. This is not only an outdated view of women, it’s also incredibly sexist.

“Women can think for themselves and if they enjoy smoking, as many do, the packaging will make no difference. It may influence which brand they buy, but not their habit.”

According to researchers at Stirling University, women in the study said they were more embarrassed about smoking from plain packs and felt more negative about smoking from the plain packs, even though they were smoking their regular cigarettes.

The same women allegedly reported smoking fewer cigarettes, stubbing out cigarettes early, smoking less around others and thinking more about quitting when using the plain packs.

Harbutt added, “This is perfectly normal behavior but it doesn’t last.”