Swedish Match posted record sales and operating profit in 2020, finishing the year with top-line growth across all product segments.
Performance was driven by strong traction for ZYN nicotine pouches in the U.S. along with double-digit operating profit growth in local currencies for the smokefree and cigar product segments in both the full year and the fourth quarter, the company said in a press release.
Covid-19-related effects are estimated to have elevated sales and operating profit for the full year as well as in the fourth quarter.
In local currencies, sales increased by 15 percent for the fourth quarter and by 17 percent for the full year. Reported sales increased by 5 percent to SEK4.14 billion ($497.12 million) for the fourth quarter and by 13 percent to SEK16.7 billion for the full year despite significant strengthening of the Swedish krona during the year versus the U.S. dollar, the Norwegian krona and the Brazilian real.
In local currencies, operating profit from product segments increased by 23 percent for the fourth quarter and by 28 percent for the full year. Reported operating profit from product segments increased by 12 percent to SEK1.7 billion for the fourth quarter and by 23 percent to SEK7.16 billion for the full year.
Operating profit amounted to SEK1.65 billion for the fourth quarter and to SEK6.99 billion for the full year. The fourth quarter of 2019 included a non-cash impairment charge of SEK367 million related to the European chewing tobacco business.
Profit after tax amounted to SEK1.24 billion for the fourth quarter and to SEK4.89 billion for the full year. The full year 2020 includes a charge of SEK286 million following an adverse ruling in a tax case.
Referring to the challenges presented by Covid-19, Swedish Match CEO Lars Dahlgren described 2020 as “a year of adaptability.”
“The success that we experienced in 2020 would not have been possible without the tireless dedication and ingenuity of our employees, the long-forged relationships that we have with our vendors and the continued passion and trust that our customers and consumers place in Swedish Match and its brands,” he said.
Swedish Match’s full financial report is available here.