Author: Staff Writer

Cigarette paper manufacturer BMJ has a new logo and slogan. The logo comprises a blue square and red letter type that appears to peel away in the left bottom corner. The square is meant to represent BMJ’s confidence and pursuit of perfection, according to BMJ CEO Omar Rahmanadi, while the peel effect symbolizes the company’s passion for unveiling new solutions. BMJ’s new slogan, “Eureka Everyday!” summarizes BMJ’s commitment to innovation. Alongside the new logo, BMJ will also be unveiling a new corporate website, www.bmjpaperpack.com.

Japan Tobacco Inc.’s domestic cigarette sales volume during the six months from April to September, at 59.6 billion, was up by 0.1 percent on that of April–September 2012.

In announcing this morning its consolidated results, JT said that a strong performance by Mevius had contributed to its domestic market share reaching 60.6 percent for April–September, up from 59.5 percent for April–September 2012.

The share increase had been led by a number of new product and sales promotion initiatives, including the introduction of value-added products into the growing menthol segment, it said.

At the same time, the company’s core revenue from domestic cigarette sales grew by 0.2 percent to ¥335.8 billion, but its adjusted EBITDA fell by 0.6 percent to ¥153.3 billion.

Meanwhile, Japan Tobacco International’s total cigarette and cigarette-equivalent shipment volume during the six months from January to June, at 201.6 billion, was down by 5.1 percent on that of January–June 2012.

Within that total, GFB (global flagship brand) shipment volume was down by 2.3 percent to 127.9 billion.

The fall in total volume was put down to continuing industry contraction and trade inventory adjustments in the first quarter.

“Year-on-year market share continued to grow in most key markets,” JT reported. “In Russia, we increased GFB share of market and, as a result, total share of value.”

GFB shipment volume declined as growth in the Caucasus markets, Czech Republic, Hungary, Kazakhstan, Turkey, Russia and other CIS markets could not fully offset industry contraction in other markets, particularly those of Europe.

JTI’s core revenue and adjusted EBITDA in U.S. dollars grew by 2.0 percent and 4.9 percent respectively as a price/mix improvement more than compensated for the volume decline and unfavorable currency movements. At constant rates of exchange, core revenue and adjusted EBITDA grew by 4.1 percent and 7.0 percent, respectively.

Including the results of its other businesses, JT’s April–September revenue increased by 9.6 percent to ¥1,159.1 billion and its adjusted EBITDA increased by 13.0 percent to ¥371.7.

Operating profit was up by 30.8 percent to ¥347.4 billion and the profit attributable to the owners of the parent increased by 40.5 percent to ¥237.1 billion.

JT’s president and CEO, Mitsuomi Koizumi, who yesterday announced that JT was slashing its domestic workforce by about 18 percent, shutting factories and cutting back on certain operations so as to protect profits, said today, in part, that the company was confident it would continue to deliver double-digit full-year earnings growth on a constant currency basis. “The overall results of the first two quarters indicate that we are on track to achieve our full-year targets,” he said.

JTI reported separately that its total cigarette shipment during January to September, at 311.2 billion, was down by 5.1 percent on that of January–September 2012, with GFB volume down by 2.1 percent to 198.2 billion.

Tobacconists in France are claiming that e-cigarettes fall under the tobacco sale monopoly law and should therefore be sold exclusively by them, according to a EurActiv story.

“We want that the sale of the electronic cigarette is done exclusively within the framework of the network of tobacconists,” said Jean-Luc Renaud, secretary general of the confederation of tobacconists.

At present, e-cigarettes are sold in a variety of shops, but a tobacconist is said to have lodged an “unfair competition” complaint against a supplier on the grounds that the product can be considered to be a derivative of tobacco.

The EurActiv story said there was a legal vacuum on the matter in France, even though a law of 1983 stated that cigarettes and smoking products “fall under the monopoly distribution of tobacconists,” “even if they do not contain tobacco.”

Meanwhile, another legal controversy is enveloping e-cigarettes, and that has to do with advertising. Tobacco advertising is prohibited in France under the Evin law, but this does not seem to cover e-cigarettes.

French Health Minister Marisol Touraine has said several times that advertising for e-cigarettes would be prohibited, but she has not tabled legislation.

Bulgaria’s National Tourism Board has warned that lifting the tobacco smoking ban in enclosed public places could result in a wave of reimbursement claims, according to a Novinite story quoting the Bulgarian Telegraph Agency.

Rumen Draganov, a member of the NTB, said the government should refrain from canceling the smoking ban for the time being.

Speaking after a meeting of representatives of the NTB and MPs of the center-right party GERB (Citizens for European Development of Bulgaria), he said that contracts had been signed with foreign tour operators for 4,800,000 holidays in 2014 and that 150,000 sales had been registered.

Draganov warned that any change to the terms of the contracts would give the other party a reason to claim compensation.

He suggested also that claims by those trying to have the smoking ban lifted that the tourism industry was in dire straits were untrue.

There were problems in the sector but these could not be laid at the feet of the introduction of the smoking ban, he added.

The Health and Family Welfare minister of India’s Karnataka state, U.T. Khader, has said that his government will explore what options it has to plug loopholes in regulations designed to prevent the consumption of certain oral tobaccos, according to a story in the latest issue of the BBM Bommidala Group newsletter.

Khader said he will be writing to the Union government on issues raised in respect of the Food Safety and Standards (Prohibition and Restrictions on Sales) Regulations (FSSR), 2011.

The Bangalore Urban District Health Officer has also called for an amendment to the regulation banning the consumption of gutka.

The minister’s intervention follows checks carried out on retailers that discovered that sachets of pan masala and chewing tobacco, the ingredients of gutka, were being sold separately but alongside each other. Often, the pan masala and chewing tobacco were of the same brand.

The FSSR bans the sale of food items such as pan masala containing tobacco and nicotine, but there is no prohibition on selling either pan masala or chewing tobacco.

Japan Tobacco Inc. is to cut its domestic workforce by about 1,600 people and close factories, sales offices and its vending machine division.

The announcement of the retrenchments comes seven months after the Japanese government reduced its share in JT from just over 50 percent to about 33 percent (with 37 percent voting rights).

One local report earlier this year had it that at least some of JT’s managers had been keen for the government to sell all of its shares because the company felt that this would remove certain management constraints.

The retrenchments, which are being made for reasons of competitiveness and profitability, come at a time when JT says the domestic business is operating in an “increasingly challenging environment.”

They will involve the replacement by April 1, 2015, of 25 area branch sales offices with 15 regional sales headquarters.

By the end of March 2015, JT will close two of its cigarette manufacturing factories: the Koriyama factory in Koriyama City, Fukushima, and the Hamamatsu factory in Hamamatsu City, Shizuoka.

It will close two other tobacco-related factories: the Hiratsuka leaf processing factory at Hiratsuka City, Kanagawa, by the end of March 2016; and the Okayama printing factory at Okayama City, Okayama, by the end of March 2015.

And the vending machine division in Akashi City, Hyogo, will be closed by the end of March 2015.

Meanwhile, though JT’s East-Japan regional leaf tobacco headquarters at Sukagawa City, Fukushima, will cease its leaf-processing operations at the end of March 2015, it will continue its leaf-buying operations.

What is described as a “voluntary retirement program” will be offered to eligible employees so as to “rightsize the workforce”—cut it down by about 1,600 people, most of whom will leave at the end of March 2015 but some of whom will leave at the end of March 2016.

“We believe that adaptability to a changing environment is critical to achieving sustainable profit growth in the mid- to long term,” said President and CEO Mitsuomi Koizumi in announcing the changes.

“The measures that we announced today aim to proactively address anticipated future challenges. By implementing these measures, the Japanese domestic tobacco business will further enhance its competitiveness and profitability, thus continuing to make significant contributions to the profit growth of the JT group.

“The Japanese domestic tobacco business remains one of the most important markets for the JT group and a highly competitive platform of the group’s profitability.”

Cigarette manufacturers in India are launching shorter-length versions of popular brands in an attempt to revive the market following a sharp surge in prices, according to a story in the most recent issue of the BBM Bommidala Group newsletter.

Sales were said to have dropped by about 3 percent during the six months from April to September.

Manufacturers are said to be meeting with sales success with sub-65 mm and 69 mm versions of normally 74 mm and 84 mm products.

India’s cigarette market is made up of length-based categories that attract different rates of tax, and the sub-65 mm filter cigarette became a new, low-tax category last year when the Indian budget was brought down.

The setting-up of the new category was aimed mainly at providing competition for the illicit trade.

Another factor that is said to be boosting the sale of small-sized packs is the ban on the oral tobacco product gutkha, which has been imposed in 26 states and seven union territories.

Earlier this month it was announced that U.S. researchers at the Harvard School of Public Health, Center for Global Tobacco Control, had found that smokers of long or ultra-long cigarettes were at greater risk of lung and oral cancer than were the smokers of regular and king-sized cigarettes.

The latest cover of Novum magazine has lifted Invercote paperboard from support act to starring role.

The starting point for the cover of the German graphic magazine’s October issue is a tribute to typography. The designer, Clormann Design, played with letters in various typefaces to create a delicate pattern that was then laser cut from the board.

“We knew this would require a paper material with unusual strength in order for it to stay together at all, so we deliberately chose to make the cover of Invercote, the paperboard from Iggesund Paperboard,” explained Christian Deppisch, a journalist at Novum.

The paperboard used was Invercote G 240 g/m² laminated with Brushprint Silver foil. The foil side of the paperboard was used as the inside of the cover but also as a flap so that the foil would function as the background for the laser-cut pattern. A copper shade was printed onto the silver foil, and a pattern was created during the printing process by letting the silver shine through.

“The designer also wanted to play with the contrasts between shiny and matte, in this case the difference between the shiny foil and Invercote G’s uncoated reverse side,” said Deppisch.

“The delicate pattern is really a challenge, and with most other materials the pattern would risk being torn to pieces even before it reached its recipient. But for this particular job the choice of material was perfect.”

Clormann Design worked with the cutting and stamping specialists Stigler of Munich for the laser cutting. Kessler Druck+Medien did the printing and binding.

A video of how the cover was produced is at: http://vimeo.com/74141756.

An opposition MP has introduced a private member’s bill into the Indian parliament calling for “logos and company branding to be totally removed from tobacco products,” according to an Australian Broadcasting Corp. report.

The proposal is said to be based on standardized packaging legislation imposed in Australia last year.

Since Dec. 1, Australia has required that all tobacco products be sold in packaging designed on behalf of the previous Labor government to be as ugly as possible. Packs are hugely dominated by graphic health warnings, are otherwise a standard olive color, have no logos or other design features, and have brand and variant names in a standardized font and position.

The Indian legislation is yet to be debated in parliament, and supporters of it are predicting staunch opposition from the tobacco industry and some politicians.

Newsagents in Ireland have labelled the 10-fold increase in the cost of a tobacco sales licence as a sneak attack on small corner shops, according to an Independent News & Media story.

Although the budget measure was not included in the finance minister’s speech, the Department of Health has confirmed on its website that a new €500 annual licensing fee for tobacco retailers—up from €50—will come into force in the coming months.

The National Federation of Retail Newsagents (NFRN) says it is unfair that the 10-fold increase is being applied equally to large supermarket chains and small corner shops.

The NFRN argues that the result will be fewer retail jobs in towns and villages across the country.

“It is a grossly unfair imposition on smaller retailers who are already hugely compliant with all tobacco regulations, as HSE monitoring confirms,” said NFRN President Joe Sweeney.

“This massive increase in registration fees will push some retailers out of the tobacco business entirely, costing jobs and leaving the market open for illicit traders to fill.

“This new charge on retailers is such a perverse and counterproductive policy decision that it will bring delight and greater profits to the criminal and paramilitary gangs now flooding the Irish market with smuggled tobacco.”