Author: Taco Tuinstra

  • ID Fraud Widespread: Survey

    ID Fraud Widespread: Survey

    Photo: Nok

    Nearly half (45 percent) of participants in a survey among adults aged 18-25 in the U.S. reported knowing someone who successfully used a fake ID to gain access to age-restricted products, such as tobacco, according to a new report by Scandit.

    The survey, which encompassed over 2,000 respondents across all 50 states, also found that 71 percent of respondents said it was either “very easy” or “somewhat easy” to acquire a fake ID and over 30 percent admitted to considering or buying a fake ID themselves. This issue is exacerbated in places with stricter regulations and a higher population of college students, with New England landing as the region with the highest percentage of under-21s considering fake IDs (45 percent) and the highest rate of successful fake ID use at 59 percent across the age range surveyed.

    “The widespread use of fake IDs presents a significant financial, compliance and reputational challenge for many businesses across the U.S., underscoring the need for greater vigilance and ensuring employees are better trained on and equipped for ID verification,” said Scandit CEO Samuel Mueller.

     

  • Thailand: Call for Targeted Vape Law

    Thailand: Call for Targeted Vape Law

    Photo: Looker Studio | Carsten Reisinger

    Thailand should create a law specifically targeting vaping, Deputy Public Health Minister Thanakrit Jitareerat told the National Health Commission Office on Aug. 1, according to a report in The Taiger.

    With various agencies independently enforcing measures based on different laws, Thailand has been unable to halt the spread of vaping, according to the minister.

    “The measures we have rolled out to date have proved ineffective, so a specific law on the matter must be drafted as soon as possible, describing vaping as a serious threat to society,” Jitareerat was quoted as saying.

    National Health Commission Office Chairman Banjerd Singkaneti countered that the government should refine existing laws to provide clearer guidelines for authorities.

    “In the long run, possession of e-cigarettes should be clearly prohibited by law so that the police will have no excuse not to pursue legal action,” Banjerd said.

    The Office of the Consumer Protection Board seized 100,000 illegal e-cigarettes in 2023, up from 27,000 in 2020.

  • Role for Social Workers in Harm Reduction

    Role for Social Workers in Harm Reduction

    Photo: pressmaster

    Social workers should be given the tools to promote tobacco harm reduction as a means to reverse the high smoking rates found in many of the populations with whom they interact, according to a new briefing paper by Knowledge Action Change (KAC)

    In 2021, according to the World Health Organization, two-thirds of people with severe mental health conditions were people who smoked and in those experiencing schizophrenia rates can reach as high as 70-80 percent. People who use illicit drugs are also three times more likely to smoke cigarettes compared to non-users. One study in California found that smoking-related conditions comprised around 40 percent of total deaths among people hospitalized with cocaine, opioid and methamphetamine disorders.

    The KAC briefing paper explores how, in countries where they are affordable and available, switching from smoking to the use of safer nicotine products could have dramatic positive effects for those supported by social workers.

    “Social workers around the world regularly work with individuals who are more likely than the general population to smoke, for example people experiencing mental health and substance use issues,” said KAC Director David Mackintosh in a statement.

    “However, few countries train social workers to support those who want to quit smoking. This is a missed opportunity for both individuals in need and the public health system. Equipping social workers with the tools to provide trusted information and advice on tobacco harm reduction options would benefit their clients, as well as their families and communities. It would save lives. The potential is massive, especially in countries where smoking cessation services are rare, non-existent or expensive to access.”

  • JT Group Profit Up

    JT Group Profit Up

    Masamichi Terabatake

    The JT Group reported revenue of ¥1.6 trillion ($10.63 billion) for the second quarter of 2024, up 12.7 percent over the comparable 2023 period. Profit increased by 6.3 percent to ¥305.2 billion.

    “The JT Group posted another strong set of results for the first half, driven by continued market share gains and solid pricing in the tobacco business,” said President and CEO Masamichi Terabatake in a statement.

    “Total volume increased by 2 percent year-on-year, with combustibles growing 1.7 percent and RRP [reduced risk products] up by a strong 25.5 percent. RRP volume was mainly driven by Ploom in the HTS segment, our investment priority, resulting in RRP-related revenue increasing by approximately 29 percent year-on-year.

    “In the Japanese market, Ploom volume increased approximately 36 percent year-on-year, growing at a faster pace than total HTS demand in the market. Additionally, the geo-expansion of Ploom has now reached 21 markets, with sales volumes in markets outside Japan also steadily increasing.

    “For the full-year performance forecast, we have revised our adjusted operating profit at constant FX [foreign exchange rates] upward, reflecting the positive momentum in the first half. On a reported basis, we have also revised our forecast upward, considering the continued impact of the current positive foreign exchange trend.”

  • Strobykin to Lead PMI Bulgaria

    Strobykin to Lead PMI Bulgaria

    An IQOS store in Sofia | Photo: markobe

    Philip Morris International has appointed Denys Strobykin as the new general manager of its Bulgarian unit, reports SeeNews. He succeeds Demian Pintos, who will become managing director of the south cluster in PMI’s Americas region, overseeing operations in Argentina, Uruguay, Bolivia, Chile and Paraguay.

    Strobykin starting in PMI’s finance department in Ukraine two decades ago. Over the years, he has held sales and marketing roles in Moldova, Poland and Romania, most recently serving as director of marketing and digital at Philip Morris Romania.

    Strobykin aims to strengthen the company’s market presence and further develop its commitment to guiding adult smokers to smoke-free alternatives, according to a PMI press release.

    “We have already made significant progress in the country—more than 350,000 adult smokers have already switched to the main smoke-free alternative in our ever-expanding portfolio—IQOS,” Strobykin was quoted as saying.

    “We have been scaling our operations responsibly, by addressing diverse consumer needs. We have been also advancing a more sustainable business model by implementing recycling programs for our devices as part of our efforts to reduce the environmental impact of our products.”

  • Turning Point Announces Results

    Turning Point Announces Results

    Photo: David

    Turning Point Brands (TPB) announced financial results for the second quarter ended June 30, 2024.

    Total consolidated net sales increased 2.8 percent to $108.5 million compared to the previous year period. Zig-Zag product net sales increased 8 percent. Stoker’s product net sales increased 18.5 percent. Creative Distribution Solutions (CDS) net sales decreased 33 percent. Gross profit increased 2.6 percent to $53.8 million. Net income increased 31 percent to $13 million. Adjusted net income increased 12.2 percent to $17.2 million. Adjusted EBITDA increased 6.9 percent to $27 million.

    “We were pleased by our second-quarter results,” said President and CEO Graham Purdy in a statement. “We achieved our highest quarterly EBITDA since the second quarter of 2021. We believe Zig-Zag is on a sustainable growth trajectory, and Stoker’s MST continues to grow market share. In addition, sales of FRE, our modern oral nicotine pouch, grew 76 percent sequentially as we continue to expand our national footprint.”

    The company is increasing its previous full-year 2024 adjusted EBITDA guidance from $95 to $100 million to $98 to $102 million, which excludes CDS.

    For the second quarter, CDS net sales were $15.3 million, gross profit was $3.4 million and gross margin was 22.5 percent.

  • Jordan Joins Protocol to Eliminate Illicit Trade

    Jordan Joins Protocol to Eliminate Illicit Trade

    Image: konstan/JaRiRiyawat

    Jordan has joined the Protocol to Eliminate Illicit Trade of Tobacco Products, reports The Jordan Times.

    Health Minister Firas Hawari described the step as an important milestone for the success of the National Action Plan 2024-2026, which is part of the broader National Tobacco Control Strategy 2024-2030.

    The Protocol is based on Article 15 of the Framework Convention on Tobacco Control, to which Jordan was one of the first countries to accede.

    This article addresses the threats posed by illicit trade and the measures that countries must take to prevent it. The protocol aims to strengthen cooperation between countries, facilitate the exchange of information, and enforce effective measures.

  • PMI Urges Collaboration Against Illicit Trade

    PMI Urges Collaboration Against Illicit Trade

    Photo: PMI

    International collaboration, stringent regulation and enforcement are the cornerstones in the fight against illicit trade, according to Rodney van Dooren, head of illicit trade prevention at Philip Morris International.

    Speaking at a trademark and brand protection conference, held in Delhi, July 23-24, van Dooren pointed out how prohibition has not been a viable option, while regulation and enforcement would be the solution to curb illicit trade.

    “Approximately 12 percent of the global cigarettes consumed are illicit, which impacts governments across the globe to the tune of $40.5 billion in tax losses, van Dooren said.

    “According to the Euromonitor report, one in four cigarettes consumed in India is illicit which translates to close to $2 billion in tax losses. There are various smuggling routes around the world for both counterfeit and contraband products, making this challenge not a domestic but a transnational issue that requires transnational solution.”

    Van Dooren urged authorities to better leverage the existing free trade agreements and provisions within the World Trade Organization to raise awareness with transit and source countries.

    “The next recommendation is to promote harmonization of existing gold standard regulations around ASEAN, supported by implementing rules, including the law enforcement agency that has jurisdiction and the related penalties,” he noted.

    “The adoption of the regulation requires manufacturers and exporters to ensure that the goods being exported comply with the destination market regulation. Additionally, in transshipment, adopt regulation that allows for inspection of suspicious shipments and exercise jurisdiction by Customs or any appropriate law enforcement agency on IP-infringing violations. Lastly, strengthen domestic enforcement effectiveness by enhanced cooperation with the legal industry and inter-law enforcement agency cooperation.”

  • Sampoerna Profit Dips

    Sampoerna Profit Dips

    Photo: Sampoerna

    Sampoerna sold 39.9 billion cigarettes in the first semester of 2024, 3 percent less than in the comparable 2023 semester. Net income increased 3 percent to IDR57.8 trillion, but net profit was down 11.6 percent to IDR 3.3 trillion.

    Sampoerna President Director Ivan Cahyadi cited a challenging operating environment. “Although economic growth is relatively stable, the purchasing power of adult consumers tends to weaken,” he said in a statement. “The challenges of the tobacco industry are also added by the pressure of double-digit excise rate increases far above the inflation rate, and the widening gap in excise rates between segments.”

    Rising taxes combined with declining consumer purchasing power has prompted many Indonesian smokers to shift to lower-taxed cigarettes or illicit offerings. According to Sampoerna, the “Below Volume Tier 1” segment has doubled since 2017 to claim 44 percent of the cigarette market.

    “Moving forward, we hope that the government continues to issue a multi-year tobacco excise policy based on clear economic parameters, like inflation rates, as well as considering adult consumers’ purchasing power, to create a conducive and sustainable business and investment climate combined with the continuous effort to combat illicit cigarettes,” said Cahyadi.

    “In addition, the government is also hoped to continue implementing policies that will support the continuity of the labor-intensive segment such as hand-rolled kretek cigarette (SKT) and halt the acceleration of downtrading to optimize government revenue from tobacco excise.”

    Cahyadi also emphasized the importance of a balanced excise policy based on risk profiles to support innovation in the tobacco industry.

    In 2023, Sampoerna invested more than $300 million in smoke-free products factory in Karawang, West Java.

    Earlier this year,  the company opened third-party operator factories in Jaten, Central Java and Dander, East Java.

    Throughout the first semester of 2024, Sampoerna employed, directly and indirectly, more than 90,000 people, of which around 90 percent are working in the labor-intensive SKT segment.

  • Altria Worried About Illicit Pouches

    Altria Worried About Illicit Pouches

    Photo: Tobacco Reporter archive

    Altria Group is worried about growing illicit sales of modern oral products in the United States, reports Reuters. The company has shared data on illegal nicotine pouches with the U.S. Food and Drug Administration.

    “This illicit market echoes the beginning of the illicit e-vapor market several years ago,” Altria CEO William Gifford told analysts during a financial update. “We believe it is critical that the FDA acts decisively to regain control of the oral nicotine pouch category to prevent another widespread illicit market from taking hold,” he added.

    Altria said it had identified more than 350 unique illegal nicotine pouches on sale, with new brands launching every month.

    Gifford said Altria had also observed an increase in illicit cigarettes, one survey of discarded packs in California finding that some 25 percent were non-U.S. brands, mostly originating from duty-free channels or China.

    Last month, Philip Morris International said it had observed sales of its nicotine pouches intended for the Scandinavian market on sale in the United States.

    Recently, British American Tobacco’s CEO expressed concern about the continued lack of enforcement against unauthorized single-use vapes in the U.S., which makes it difficult for authorized brands to compete in that market.