Author: Staff Writer

Efforts are being made in Andhra Pradesh, India, to have 50 villages declared tobacco-free by the end of May.

After the village of Pongalipaka in the Madugula division of the Visakhapatnam district of Andhra hit the headlines for becoming the state’s first tobacco-free village on May 31, 2012, efforts have been under way to make 50 villages spread over six districts of the state tobacco-free by this year’s World No Tobacco Day.

Kishore Mogulluru, state consultant with STEPS, Strengthening Tobacco Control Efforts Through Innovative Partnerships and Strategies, said that the organization was leaving no stone unturned to score the half century of villages, a majority of them in Visakhapatnam.

He told The Hindu that bottom-up and top-down approaches were being followed to encourage villagers to convince tobacco product vendors to shut up shop, users to give up their addiction, and tobacco growers to shift to alternative crops such as green gram and tomato.

Andhra is one of two states, the other being Karnataka, that produce the nations export flue-cured tobacco.

Lorillard’s domestic shipment volumes during the 12 months to the end of December 2012, at 39,490,890,000, were down by 1.4 per cent on those of the previous 12 months.

Including shipments to Puerto Rico and US Possessions, shipments were down by 1.4 per cent to 40,152,192,000.

Shipments of Newport cigarettes fell by 1.8 per cent to 33,125,424,000, and shipments of premium brands taken together decreased by 2.0 per cent to 33,487,272,000, with shipments of Kent down by 13.9 per cent to 175,116,000 and shipments of True down by 13.3 per cent to 186,732,000.

Shipments of price/value brands increased by 2.2 per cent to 6,003,618,000, with shipments of Old Gold down by 10.7 per cent to 494,166,000 and shipments of Maverick up by 3.5 per cent to 5,509,452,000.

Lorillard’s market share during 2012, at 14.4 per cent was up by 0.3 of a percentage point on that of 2011, with Newport’s share up by 0.2 of a percentage point to 12.1 per cent.

Menthol cigarettes last year held a 31.1 per cent share of the US market, up by 0.6 of a percentage point from that of the previous year, and Lorillard held a 39.3 per cent share of the total US menthol segment, up by 0.2 of a percentage point. Newport’s share of the US menthol segment was 36.1 per cent, down by 0.1 of a percentage point.

Meanwhile, during the three months to the end of December, Lorillard’s domestic cigarette shipments, at 9,846,815,000, were up by 0.4 per cent on those of the three months to the end of December 2011. Including Puerto Rico and US possessions, shipments were up by 0.3 per cent to 10,012,223,000.

Newport’s shipments during the final quarter were up by 0.9 per cent to 8,263,979,000, and total full price brand shipments were up by 0.7 per cent to 8,353,055,000. Total price/value brand shipments were down by 1.4 per cent to 1,493,760,000.

Lorillard’s net sales during the 12 months to the end of December, at $6,623 million, were up by 2.4 per cent on those of the previous 12 months period.

Reported operating income was down by 0.7 per cent to $1,878 million while adjusted operating income was up by 0.9 per cent to $1,883 million.

Net income was down by 1.5 per cent to $1,099 million while adjusted net income was up by 0.2 per cent to $1,103 million.

Reported diluted earnings per share were up by 5.6 per cent to $2.81 while adjusted diluted earnings per share were up by 7.2 per cent to $2.82.

“Lorillard delivered strong financial and market share results in both the fourth quarter and full year of 2012 despite a heightened competitive environment,” said chairman, president and CEO, Murray S. Kessler, in announcing the results yesterday.

“We are very pleased to have delivered a double-digit shareholder return as measured by EPS growth and the dividend yield during 2012, and to have grown market share for the tenth consecutive year.

“We are confident in our ability to continue this strong financial performance in 2013, as reflected by our recent 3-for-1 stock split and today’s announcement of a 6.5 per cent dividend increase.”

Philip Morris International is due to host a live audio webcast of a presentation and question-and-answer session by its CFO, Jacek Olczak, at the Consumer Analyst Group of New   York (CAGNY) Conference.

The entire session will be available in listen-only mode at www.pmi.com starting about 09.15 hours Eastern Time on February 20.

An archived copy of the webcast, presentation slides and the script will be available at the same website until 17.00 hours on March 21.

Imperial Tobacco’s operation in Poland has been handed a prestigious award by the nation’s leading business organisation.

The ‘Diamond to the Gold Statuette of the Business Leader’ was awarded in recognition of Imperial’s social and economic contribution to Polish society.

The award was made at the annual Grand Gala of Business Leaders held in Warsaw by the national Business Centre Club.

Imperial was chosen by a jury of leading business people who looked at how companies take care of their employees, contribute to local communities and engage with stakeholders.

The award, which builds on the gold statuette Imperial received last year, was accepted by Grażyna Sokołowska, corporate and legal affairs manager Poland.

“I’m delighted we’ve been recognised as a responsible business making a valuable contribution, which can only be achieved through the efforts of all our employees,” said Sokołowska.

R.J Reynolds Tobacco’s US domestic cigarette volume during the year to the end of December, at 68.9 billion, was down by 5.6 per cent on that of 2011.

Pall Mall volume fell by 0.6 per cent to 21.9 billion and Camel volume fell by 2.3 per cent to 21.2 billion; so the company’s total ‘growth brands’ volume was down by 1.4 per cent to 43.1 billion.

The volume of RJR’s other brands was down by 11.8 per cent to 25.8 billion.

Reynolds American Inc, whose business sectors take in RJR, Santa Fe and American Snuff, announced its full-year and fourth-quarter results yesterday.

RJR’s volume during the fourth quarter to the end of December, at 17.1 billion, was down by 2.7 per cent on that of the fourth quarter of 2011.

Pall Mall volume increased by 5.5 per cent to 5.7 billion while Camel volume fell by 0.2 per cent to 5.3 billion; so the company’s total growth brands volume was increased by 2.7 per cent to 11.0 billion.

The other-brands volume fell by 11.0 per cent to 6.1 billion.

RJR’s share of the domestic cigarette market during the year to the end of December, at 26.5 per cent, was down by 1.1 percentage points from that of its 2011 share.

Pall Mall’s share rose by 0.1 of a percentage point to 8.6 per cent, while Camel’s share was unchanged at 8.5 per cent.

The share held by the company’s other brands fell by 1.2 percentage points to 9.4 per cent.

Meanwhile, Santa Fe’s cigarette (Natural American Spirit) volume during the year to the end of December, at 3.1 billion, was increased by 11.3 per cent on that of 2011, while its volume during the three months to the end of December, at 0.8 billion, was 20.3 per cent up on that of the three months to the end of December 2011.

Santa Fe’s share of the retail market during 2012, at 1.2 per cent, was up by 0.2 of a percentage point on that of 2011.

American Snuff’s volume during the year to the end of December, at 437.1 million cans, was up by 8.0 per cent on that of 2011.

Grizzly volume increased by 9.4 per cent to 389.2 million cans, while sales of the company’s other moist snuff products fell by 1.9 per cent to 48.0 million cans.

American’s volume during the three months to the end of December, at 112.4 million cans, was up by 7.2 per cent on that of the three months to the end of 2011.

Grizzly volume was increased by 8.1 per cent to 100.2 million cans, while the volume of the company’s other brands was up by 0.1 per cent to 12.2 million cans.

American’s share of the moist snuff market during the year to the end of December, at 32.4 per cent, was increased by 1.4 percentage points on that of 2011.

Grizzly’s share was up by 1.6 percentage points to 29.0 per cent, while the share of other brands was down by 0.3 of a percentage point to 3.4 per cent.

RAI had net sales of $8,304 million during the 12 months to the end of December, 2.8 per cent down on those of 2011.

Reported operating income was down by 7.7 per cent to $2,214 million, while adjusted operating income was up by 1.6 per cent to $2,863 million.

Reported net income was down by 9.5 per cent to $1,272 million, while adjusted net income was up by 2.4 per cent to $1,686 million.

And reported net income per diluted share was down by 6.7 per cent to $2.24, while adjusted net income per diluted share was up by 5.7 per cent to $2.97.

“I’m very pleased to report that Reynolds American turned in a strong finish to a challenging year, delivering higher fourth-quarter and full-year adjusted earnings and margin on resilient performance at our operating companies,” said Daniel M. Delen, president and CEO in announcing the results.

“Our reportable business segments – RJR Tobacco, American Snuff and Santa Fe – made steady progress through 2012, building momentum on their powerful key brands.

“Our companies also marked new milestones in innovation, with the further development of exciting products that position RAI’s operating companies for continued growth in a changing marketplace.”

Delen pointed to innovations such as Niconovum USA’s Zonnic nicotine replacement therapy gum and R.J. Reynolds Vapor Company’s Vuse e-cigarette as examples of how RAI and its operating companies are focused on transforming the tobacco industry.

“Our companies continue to focus on strengthening their businesses and finding new opportunities for growth in today’s highly competitive environment, but they’re also driving change in our industry that is critical for commercial success over the long term,” Delen said.

Russia’s lower house of parliament, the State Duma, yesterday approved in its third and final reading a bill banning tobacco smoking in public places, according to an RT TV/TV Novosti story.

The ban, which is due to take effect on June 1, was passed by a 441 votes to one.

The bill envisages a gradual ban on tobacco smoking in public, including in government buildings, healthcare and educational facilities, cultural sites and stadiums, and on public transport.

Additional restrictions proposed on January 11, in particular one that would have outlawed separate smoking areas at workplaces, were not included in the bill’s final version.

Tobacco companies will not be able to advertise their products and they will be barred from holding promotional prize draws and sponsoring public events and competitions.

The bill prohibits displaying tobacco products in shops.

Opponents of the standardized packaging of tobacco on Monday launched an online campaign urging people in the UK to lobby their members of parliament about the issue.

Hands Off Our Packs, the campaign set up and run by the smokers’ group Forest, has launched a new website that supporters hope will encourage thousands of people to inform their local MPs about their opposition to the measure currently under discussion.

Visitors to the website, Say No To Plain Packs, must enter their name, e-mail address and postal addresses complete with postcode. At a click of a button a template letter will be sent to their MP.

According to the letter, plain packaging ‘was not included in any election manifesto in 2010 and was rejected by the previous government in 2008 on the grounds that there was insufficient evidence to support such a policy’.

“Nothing has happened since then,’ the letter says, ‘that could possibly justify a change of policy under the current government.’

The letter adds that ‘police officers, retired and serving, have expressed concern that plain packaging will encourage organised crime. Their views are shared by many small retailers, wholesalers, packaging companies and design agencies who may be forced to cut jobs if plain packaging is introduced.’

The letter concludes by saying, “There is no credible evidence that packaging encourages children to start smoking and to argue otherwise is to fly in the face of common sense’.

The Say No To Plain Packs online campaign will play to just under a million people over five days.

Hands Off Our Packs campaigner Angela Harbutt said that 700,000 members of the public had responded to the government consultation on plain packaging. “Half a million were against the proposal yet many MPs are still unaware of the level of opposition this policy faces,” she said.

“It is now six months since the consultation closed and we have still to hear anything from the Department of Health. It is time that we helped put MPs in the picture.”

The Philippines is putting further pressure on Thailand to comply fully and in a timely manner with a World Trade Organization ruling in respect of a cigarette excise tax dispute between the two countries, according to a story in the Manila Bulletin.

This follows the Philippines’ implementation of a new excise tax law on distilled spirits and tobacco products that has brought it into compliance with a separate WTO ruling.

The WTO had ruled in favor of the EU and the US that the Philippines should correct its ‘discriminatory’ tax structure on imported distilled spirits.

The Philippines’ Trade and Industry undersecretary, Adrian S. Cristobal Jr, said the passage of the new excise tax law had shown that the Philippines was a law abiding member of the WTO.

At the same time, he stressed that this structural reform had strengthened the country’s position whereby, as a WTO member, it could command the same compliance from other member states.

“It shows that we are abiding by international treaty, the WTO in particular, but that is a two-way street,” Cristobal said. “This also strengthens our position that as a member of WTO we also command compliance from other member states.”

UK-based Innovia Films has agreed to buy the Reserve Bank of Australia’s 50 per cent share in Securency International Pty Ltd, which, since 1998, has been owned by Innovia and the bank in a 50/50 joint venture.

The acquisition is being funded from Innovia’s existing cash reserves and is expected to be completed on February 28. The agreed price was not given.

Innovia had been directly involved for many years in the worldwide growth of Securency International’s product, polymer-based Guardian® banknote substrate, and had a high degree of confidence in the company and the product, Innovia said in a press note issued today.

“The RBA has been an outstanding and committed partner in this joint venture,” said Innovia Films CEO, David Beeby.  “It has always been their clearly stated policy to grow the business to the point where it would be divested once it held a strong position in the market, and that time has certainly arrived.  This exciting acquisition reflects our continued commitment and strategic investment pattern in our core markets of labels, tobacco, packaging and security.”

The press note said the RBA has confirmed that Australia’s next generation of banknotes would incorporate Guardian®, ‘a clear demonstration of its confidence in the company moving forward’.