Month: March 2024

  • IQOS Iluma i Debuts in Japan

    IQOS Iluma i Debuts in Japan

    Photo: Ned Snowman

    Philip Morris International has launched IQOS Iluma i, the latest and most innovative addition to its growing portfolio of smoke-free products, in Japan. The launch marks the 10-year anniversary of IQOS, which debuted in Nagoya, Japan, in 2014.

    “We leverage science, world leading brands and commercial capabilities to provide better alternatives to our consumers. This anniversary provides an opportunity to renew our smoke-free vision and our ambition for over two-thirds of our total net revenue to come from smoke-free products by 2030,” said PMI CEO Jacek Olczak in a statement.

    “IQOS Iluma disrupted the category by introducing induction-heating technology that heats tobacco from within, to provide a consistent taste experience, no tobacco residue, and no need to clean the device. Today, we take IQOS to new heights, with the launch of IQOS Iluma i—the latest innovation in our smoke-free portfolio, offering a range of advanced features for a clean, seamless, and more flexible experience.”

    The IQOS Iluma i series offers three devices in Japan: IQOS Iluma i PRIME, IQOS Iluma i and IQOS Iluma i ONE. All three devices bring a range of adaptable new features.

    The new touch screen on the device’s holder allows users to see experience-relevant information quickly and easily. To personalize the experience, IQOS Iluma i introduces a new pause mode. By swiping up or down on the touch screen, users can pause and resume their consumption according to their preferences.

    The new IQOS Iluma i also includes smart features that help prolong the lifespan of the holder’s battery. Furthermore, the door for IQOS Iluma i is made from aluminum produced with renewable energy and the inner textile layer of IQOS Iluma i’s Prime leather-like wrap is made of 100 percent recycled plastic.

    “IQOS Iluma i is our most innovative offering to date and the new flagship in our portfolio of scientifically substantiated, heat-not-burn smoke-free systems,” said Bertrand Bonvin, president heat-not-burn platforms at PMI. “Like previous IQOS devices, it emits, on average, 95 percent lower levels of harmful chemicals compared with cigarettes. We are proud that consumer feedback continuously fuels our innovation, and IQOS Iluma i is a testament to that.”

  • Zimbabwe Crop Down 10 Percent

    Zimbabwe Crop Down 10 Percent

    Photo: Taco Tuinstra

    An El Nino-induced drought has slashed volumes but raised farmers’ hopes for strong pricing.

    Zimbabwe’s tobacco volume is likely to be at least 10 percent below last year’s record 296 million kg due to drought, reports Reuters.

    The growing season was impacted by El Nino, a natural climate phenomenon in which the surface waters of the central and eastern Pacific Ocean become unusually warm, causing changes in global weather patterns.

    At 113,000 hectares, the tobacco growing area this season was 3 percent smaller than that of last year. Yields per hectare were down, as well.

    Following an ambitious land reform in the 2000s, Zimbabwean tobacco production is dominated by smallholder farmers who lack irrigation systems.

    Zimbabwe’s two licensed Harare auction floors, which handle approximately 5 percent of the country’s tobacco crop, are scheduled to open tomorrow. Deliveries for the far-larger contract sales will commence on Friday.

    Contract tobacco sales will be conducted not only in Harare, but also at approved decentralized selling centers in the countryside. These were set up during Covid-19 to minimize travel but proved so successful that they were maintained after the pandemic receded.

  • ITC Shares Jump on BAT Sale

    ITC Shares Jump on BAT Sale

    Timon Schneider/Wirestock

    ITC’s share price jumped more than 8 percent on March 13 after British American Tobacco sold a $2 billion stake in the Indian conglomerate, reports Reuters.

    The share price had initially fallen in the wake of BAT’s original announcement, as investors were uncertain of the transaction’s conditions.

    The sale of 436.9 million shares, representing about 3.5 percent of ITC’s outstanding shares, still leaves BAT with a stake of more than 25 percent in the company.

    Cigarettes are ITC’s largest business, accounting for more than 40 percent of its revenue. The company has been working to consolidate its business, with plans to spin off its hotel business.

    BAT said it intends to use the net proceeds to buy back BAT shares over a period ending December 2025, starting with £700 million in 2024. “This will enable the allocation of operating cashflow to fund investment in our transformation, continue to deleverage towards our new target range of 2-2.5x adjusted net debt/adjusted EBITDA, while also maintaining a progressive dividend and supporting a sustainable share buyback,” the company wrote on its website.

  • BAT India to Sell Shares of ITC

    BAT India to Sell Shares of ITC

    Image: Tobacco Reporter archive

    BAT’s wholly owned subsidiary Tobacco Manufacturers (India) intends to sell up to 436,851,457 ordinary shares in ITC to institutional investors. The trade shares represent up to approximately 3.5 percent of ITC’s issued ordinary share capital.

    Following completion of the proposed block trade, BAT’s shareholding in ITC will be approximately 25.5 percent.

    BAT intends to use the net proceeds of the trade to buy back BAT shares over a period ending December 2025, starting with £700 million ($892.9 million) in 2024. BAT will continue to allocate operating cashflow to fund investment in its transformation and to further deleverage.

    Going forward, the key elements of capital allocation at BAT will include continued investment in its transformation; progressive dividends; continued deleverage to a new range of 2 times to 2.5 times adjusted net debt/adjusted EBITDA; and sustainable share buybacks, according to the company.

    “I am confident that ITC, under the stewardship of its current management, will continue to create further value for its shareholders,” said BAT CEO Tadeu Marroco in a statement. “We look forward to remaining important shareholders in ITC as it continues its journey of growth. With this transaction, BAT can accelerate the start of a sustainable buyback while enabling us to continue to deleverage toward a new target range of 2 [times] to 2.5 times adjusted net debt/adjusted EBITDA.”

  • Consumer Group Says No to PMTA Registries

    Consumer Group Says No to PMTA Registries

    U.S. states must recognize the unintended consequences of passing laws requiring premarket tobacco product application (PMTA) registries for alternative nicotine products such as vaping devices, heaters, and nicotine pouches, according to the Consumer Choice Center, an organization claiming to represent consumers in more than 100 countries.

    In the first months of 2024, more than a dozen bills have been introduced in U.S. states calling for a state-based registry for alternative nicotine products. Such legislation has already been passed in Oklahoma, Louisiana and Alabama.

    “While the intention behind these bills is to manage consumer access to unregulated nicotine products on the illicit market, the reality is that the FDA is not approving enough new devices and products to create a competitive, regulated marketplace that meets consumer demand,” said Elizabeth Hicks, U.S. affairs analyst at the Consumer Choice Center.

    While 26 million nicotine alternative products submitted PMTAs to the Food and Drug Administration, only 23 have been approved. Of those 23 approved products, 12 are tobacco-flavored e-liquid refills.

    “The FDA is hiding the ball here on product approvals and how few new products are actually coming to market. If the goal is to improve public health across the country, then consumers deserve to choose from a variety of different nicotine alternatives,” said Hicks.

    The Consumer Choice Centers urges state legislatures to refrain from adding to counterproductive federal policies and instead advance tobacco harm reduction through a competitive marketplace.

  • Okman Joins Filtrona as Commercial Director

    Okman Joins Filtrona as Commercial Director

    Lutfu Okman (Photo courtesy of Filtrona)

    Filtrona has appointed Lutfu Okman as its new global commercial director.

    Okman brings with him over 25 years of commercial leadership experience, including senior management roles with multinational companies in the textiles, chemical and manufacturing industries.

    He succeeds Hywel Thomas, who has announced his retirement after 10 years with the company.

    “We are really pleased to welcome Lutfu to the Filtrona family,” said Filtrona CEO Robert Pye in a statement. “His proven track record of strategic commercial growth and wealth of experience make him an ideal fit for the role, and he is primed to drive our ambitious growth strategy. Lutfu plays a pivotal role in shaping Filtrona’s commercial endeavors and fostering sustainable long-term growth.”

    “I am thrilled to join Filtrona at such an exciting time in its journey, particularly during the 100-year anniversary of the company’s first patented filter,” said Okman. “I look forward to collaborating with the talented and passionate Filtrona team to drive our commercial strategy, deliver exceptional value to our customers, and contribute to the company’s continued growth.”

    Pye also expressed his gratitude for Thomas’ dedication and contributions to Filtrona. “Hywel’s leadership, strategic vision, and sharp business acumen have been invaluable to Filtrona, helping to make us the successful and dynamic global business that we are today. We sincerely thank Hywel and wish him the very best in his well-earned retirement.”

  • Turning Point Appoints Andrew Flynn CFO

    Turning Point Appoints Andrew Flynn CFO

    Image: motortion

    Turning Point Brands (TPB) has appointed Andrew Flynn as the company’s new chief financial officer (CFO), effective on or before April 1, 2024. Flynn is replacing Louie Reformina, who will step down to pursue other opportunities.

    Prior to joining Turning Point Brands, Flynn served as the CFO of Connected Cannabis Co., where he was responsible for bringing sustained profitable growth, expanding geographically and recapitalizing the company. In this role, Flynn operationalized and reshaped the finance, IT, legal and compliance organizations to meet business objectives. Before joining Connected, he served as senior vice president of Juul Labs. Earlier in his career, he served as vice president of finance at James Hardie Building Products and vice president of finance at Arrow Electronics. Flynn holds a Bachelor of Science degree from Indiana University and a Master of Business Administration degree from the University of Colorado Denver.

    “Turning Point Brands is one of the most innovative and well-capitalized companies in the industry. TPB’s iconic Zig-Zag and Stoker’s brands and market-leading distribution platform set it apart in this rapidly evolving space. As CFO, I look forward to working with the board and management team to maximize long-term shareholder value,” said Flynn.

    “Andrew has led key initiatives across all areas of finance and broader strategic planning throughout his career. His diverse operating background and industry expertise ideally positions him to help us maximize the value of our brands, continue to modernize our organization, and grow our free cash flow,” said Graham Purdy, Turning Point Brands’ president and CEO.

  • Habanos Announces Deal With Liquor Maker

    Habanos Announces Deal With Liquor Maker

    Credit: Creuxnoir

    Chinese liquor company Luzhou Laojiao and Cuban cigar company Habanos SA have signed a strategic agreement to jointly expand their markets.

    During the 24th Habano Festival in Havana, Cuba, Zhang Biao, general manager of Luzhou Laojiao, highlighted the similarities between Luzhou Laojiao’s liquor and Cuban cigars, noting that the cooperation will strengthen the commercial ties between China and Cuba.

    The agreement includes a joint product through co-branding, with the Chinese company handling the marketing. José María López, vice president of development at Habanos, said that this partnership is based on shared values ​​such as craftsmanship, quality and leadership, highlighting the “perfect match” between Chinese liquors and Cuban cigars.

    Habanos executives reported that China is one of the most dynamic markets for Cuban cigar sales. The country contributed heavily to a 31 percent increase in Cuban cigar sales in 2023, reaching a total of $721 million.

    The signing of the Memorandum of Understanding aims to explore new avenues of cooperation for both companies. Luzhou Laojiao, one of China’s oldest liquors, has been produced in the National Treasure Cellars since 1573, with distillation technology dating back 700 years.

    The collaboration will focus specifically on Luzhou Laojiao’s “Guojiao 1573” brand and Habanos Corporation’s Cohiba Atmosphere brand. In addition, seven Guojiao 1573 brand liqueurs were auctioned along with during the festival’s humidor auction, with the funds raised going to public health initiatives in Cuba.

    “This strategic agreement strengthens commercial ties between China and Cuba in the liquor and cigar industries,” according to a press release.

  • TIMB Licenses 32 Contractors

    TIMB Licenses 32 Contractors

    Photo: Taco Tuinstra

    Zimbabwe’s Tobacco Industry and Marketing Board (TIMB) has licensed 32 contractors to buy leaf this season, reports The Herald.

    The country’s tobacco auctions will open March 13, with the contract floors starting operations a day later.

    To date, the regulator has licensed only two auction floors—the Tobacco Sales Floors and Premier Tobacco Auction Floor.

    Contract sales will be conducted in Harare and at decentralized selling centers in Karoi, Mvurwi, Bindura, Marondera and Rusape.

    TIMB Head of Operations Blessing Dhokotera reiterated that tobacco farmers would retain 75 percent of their proceeds in U.S. dollars and the remainder in local currency.  

    He also highlighted measures against child labor, side marketing and the spread of infectious diseases such as Covid-19 and cholera.

    Zimbabwe’s tobacco production has suffered from drought this years, with officials predicting a harvest of 265 million kg this year, compared with 294 million kg in 2023, according to News Day.

    The droughts are attributed to the El Nino climate phenomenon which involves a periodic warming of ocean temperatures in the central and eastern Pacific Ocean, near the equator, and can have significant impacts on weather patterns worldwide.

  • BAT Inaugurates Innovation Center

    BAT Inaugurates Innovation Center

    Photo: BAT

    Included in British American Tobacco’s new innovation center at Southampton, U.K., is a nicotine-pouch pilot plant that allows its researchers to go from concept to trial product in an hour. The investment in the pilot plant is presumably an indication of the confidence the company has in nicotine pouches, which sit comfortably alongside nicotine replacement therapy products on the continuum of risk and that are perhaps the most environment friendly of all the lower-risk products being used to assist smokers move away from cigarettes.

    Officially opened on March 7 in the presence of BAT’s entire management board, the new center is housed within BAT’s research and development facility, which has been in operation since 1956 on a site occupied by the company for more than 100 years.

    In a press note, BAT said the £30 million ($38.56 million) investment would support its mission to become a predominantly smokeless business in which 50 percent of its revenue was derived from non-combustibles by 2035.

    The center provides nine specially designed technical spaces to aid the development of BAT’s portfolio of new category products. “These spaces are dedicated to research for modern oral nicotine pouches, for liquids and flavor for vapor products, for heated tobacco products, and for well-being and stimulation beyond nicotine,” the press note said. “The investment will also support work on packaging, engineering, innovation development and system integration…

    “The new facilities will bring together cross-functional and key R&D teams—with 400 highly specialized scientists and engineers, drawn from a range of fields including biotechnology and clinical trials. These teams will accelerate the development of the next generation of BAT’s new category products and provide the robust evidence necessary to encourage adult smokers to switch to less risky alternatives, backed by science.’

    James Murphy, director, research and science at BAT, said, “The opening of this new facility marks an important milestone in BAT’s transformation and will play a key role in making a smokeless future a reality.”

    Meanwhile, BAT said it had more than 1,600 specialists spread across the U.K., the U.S., Brazil, Indonesia, Malaysia and China. “The £30 million investment in the Southampton facility follows the opening of BAT’s innovation centers in Trieste, Italy, in 2021 and in Shenzhen, China, in 2022, and an investment of £300 million a year in R&D to develop new category products and establish substantiation of their reduced risk potential,” the company said.