China Tobacco International (CTI) warned its revenue and net profit may slump by 50 percent to 60 percent from a year ago during the first half of this year.
The company attributed the drop to seasonal fluctuation in the import of tobacco leaf products from Brazil. Also, the sales volume of cigarettes in duty-free outlets in China and the relevant regions declined significantly because of the drop in passenger traffic amid the coronavirus pandemic, the company said.
A subsidiary of the China National Tobacco Corp.—the world’s largest cigarette manufacturer—CTI primarily procures leaf tobacco for its parent company, earning revenue mainly from a fixed markup on the sale of leaves to domestic cigarette makers.
The international unit is also the sole exporter of Chinese cigarette brands such as Yuxi and Hongtashan to duty-free outlets. In May 2018, it began exporting heat-not-burn tobacco products made in China.
In June 2019, shares of CTI started trading on the Hong Kong Stock Exchange.