Category: News This Week

Kaival Appoints CEO and CFO
Eric Mosser
Kaival Brands Innovations Group has promoted its current president and chief operating officer, Eric Mosser, to the position of CEO.
Mosser, who will retain the position of president, brings over a decade of senior leadership experience, including since 2020 at Kaival Brands.
From 2022 to 2014, Mosser worked as director of information technology at Timbercon, a fiber-optic design company and ITAR manufacturing facility in Oregon, USA. In 2014, Mosser created Lasermycig, a specialized custom laser-engraving service for electronic cigarettes and vaporizers and served as its CEO until 2020.
In 2015, Mosser and Bidi Vapor owner Nirajkumar Patel founded Chillcorp, a full-service corporation managing operations of Just Chill Products, Relax Lab., RLX Lab, and KC Innovations Lab.
Kaival Brands Innovations Group has also appointed Thomas J. Metzler as its new chief financial officer, treasurer and secretary, replacing Mark Thoenes, who has served as Interim CFO since 2021.
Metzler brings over 20 years of finance and operational experience in the vaping and consumer products sector, previously serving as managing director of a division of Turning Point Brands.
At Turning Point Brands, Metzler led a team to transform the process of financial management efficiencies, which improved cost controls, managed inventory turn, developed strategic product promotions to accelerate product distribution, and built strategic alliances with suppliers. Metzler also developed and monitored key performance indicators (KPI).
Metzler has extensive knowledge of vaping technologies and a record of building strong partnerships with industry stakeholders. He has also been actively engaged in national trade and industry standards organizations.
At Kaival, Metzler’s will initially focus on maximizing inventory turn and driving revenue, developing and monitoring KPIs and controlling costs. Metzler also has experience in mergers and acquisitions and post-acquisition integration, which he will bring to bear on the vaporizer and inhalation patent portfolio acquired by the Kaival in May 2023.
“We are very excited to have Tom join our senior management team and believe his hiring represents a key building block for the future of Kaival Brands,” said Mosser in a statement. “Tom brings to us a wealth of experience and knowledge across all of the key elements of the CFO’s office including treasury, finance and accounting.”

August 7, 2023
Quebec Flavor Ban to Begin in October

Image: Arcady
Quebec’s flavor ban will take effect Oct. 31, according to Vaping360.
The ban will include vaping products with flavors other than tobacco and will prohibit e-liquid sold in bottles with a capacity greater than 30 mL and prefilled devices with a capacity greater than 2 mL.
The flavor ban was announced in a draft published in April. More than 30,000 citizens of Quebec commented on the proposed ban, according to the Quebec Vaping Rights Coalition, but the health ministry reportedly didn’t make any changes to the rules in response.
Quebec is the largest province in Canada to pass a flavor ban. Four other provinces and territories have flavor bans in place, and one has passed a ban but has not set an effective date yet. Three other provinces restrict flavored products to adult-only stores.
August 4, 2023
Zimbabwe Aims for $1.6 Billion in Exports

Image: Tobacco Reporter archive
So far this marketing season, Zimbabwe has exported more than 98 million kg of tobacco. The country’s goal is to export $1.6 billion total, according to The Herald, an increase from 2022’s $900 million.
To date, $502 million has been exported compared to $417 million in the same period in 2022, a 20 percent increase.
Export value includes what farmers receive in payment for growing, curing and grading the crop as well as what merchants earn for extra processing, packing, application of skills in meeting precise customer orders and final dispatching.
“In terms of exports from our leaf, we are projecting over $1.6 billion compared to $900 million achieved in 2022, so we are going for growth in every aspect,” said John Basera, Lands, Agriculture, Fisheries, Water and Rural Development permanent secretary. “My expectations are very high; we need to go for better growth.” According to Basera, this year’s tobacco yield is the highest and best ever produced in the country.
“The season was good, the crop quality was also good and so are the prices,” said Chelesani Tsarwe, Tobacco Industry and Marketing Board (TIMB) public relations officer. “Farmer payments are being done on time as compared to previous seasons. Overall, there was orderly tobacco marketing, and stakeholders are adhering to the board’s compliance frameworks.”
“If government continues to empower smallholder farmers like in the case of Pfumvudza, then farmers are assured of getting inputs on time,” said Edward Dune, Tobacco Farmers Union Trust vice president. “Unscrupulous middlemen should totally be eliminated to ensure that farmers get what they actually deserve.”
“Tobacco has transformed the majority of people, but there is a need to ensure that processing is done in the country to ensure that our farmers get more money,” Dune said.
Tobacco accounts for the largest foreign currency earning crop in Zimbabwe. The crop is exported throughout the year, but the bulk is bought from contracted farmers. China accounts for 40 percent to 45 percent of total exports.
August 4, 2023
Biden Opposed to Limiting Flavor Regs

Image: Tobacco Reporter archive
The Biden administration has published a Statement of Administration Policy outlining its opposition to parts of a proposed funding bill that would limit the Food and Drug Administration’s ability to ban flavored cigars and menthol cigarettes, reports Halfwheel.
The proposed bill would prevent the FDA from receiving funding if it introduced bans on flavored cigars and menthol cigarettes or introduced rules limiting the amount of nicotine a product can have.
The Statement of Administration Policy is not binding. It does not mention the nicotine cap either.
August 3, 2023
NASDAQ Grants Kaival Extension

Image: Tobacco Reporter archive
The NASDAQ Stock Market has granted Kaival Brands an additional 180 days to regain compliance with NASDAQ’s $1 minimum bid price rule requirement under NASDAQ Listing Rule 5550(a)(2) (the Bid Price Rule), following the expiration of the initial 180-day period to regain compliance on July 31, 2023, according to GlobeNewswire.
NASDAQ’s action follows the submission by Kaival Brands to NASDAQ of a plan for regaining compliance with the Bid Price Rule.
As a result of the extension, Kaival Brands now has until Jan. 29, 2024, to regain compliance with the $1.00 minimum bid price rule requirement. If at any time before Jan. 29, 2024, the bid price of Kaival Brands’ common stock closes at or above $1 per share for a minimum of 10 consecutive business days, NASDAQ will provide written notification to Kaival Brands that it has achieved compliance with the bid price requirement. If Kaival Brands chooses to implement a reverse stock split to regain compliance with the Bid Price Rule, it must complete the reverse split no later than 10 business days prior to the expiration of the additional 180-calendar-day period in order to timely regain compliance.
If Kaival Brands does not regain compliance with the bid price requirement by Jan. 29, 2024, NASDAQ will provide written notification to Kaival Brands that its common stock will be subject to delisting. At such time, Kaival Brands may appeal the delisting determination to a NASDAQ Hearings Panel. There can be no assurance that if Kaival Brands does appeal a subsequent delisting determination, such appeal would be successful. Kaival Brands’ common stock would remain listed pending the panel’s decision.
The current notification from NASDAQ has no immediate effect on the listing or trading of Kaival Brands’ common stock, which will continue to trade on the NASDAQ Capital Market under the symbol “KAVL.”
August 3, 2023
KT&G Reports Second-Quarter Results

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KT&G Corp. posted consolidated revenue of KRW1.34 trillion ($1.03 billion) and operating profit of KRW242.9 billion for the second quarter ended June 30, 2023, according to PR Newswire.
Sales of both combustible cigarettes and heat-not-burn (HnB) products were higher than in the comparison period.
HnB volumes jumped 43.5 percent to 3.63 billion sticks, driven primarily by the rapid global expansion of KT&G’s Lil brand. For the second quarter, KT&G’s overseas heat-not-burn category recorded sales volume of 2.21 billion sticks, a 72.7 percent growth year-over-year.
The company’s overseas combustibles revenue, including both overseas subsidiaries and exports, was KRW265.5 billion. The export revenue increased 5.9 percent year-over-year to KRW152.9 billion, mainly due to the favorable pricing in key markets, including Latin America and the Middle East. The favorable pricing has also increased the profitability of the combustibles exports, as the export operating profit grew 42.6 percent year-over-year. The overseas combustibles sales volume grew 2.6 percent year-over-year to 13.17 billion sticks.
KT&G also shared its plans on share repurchase and cancellation and interim dividend. As part of its three-year shareholder return policy, KT&G plans to acquire 3.47 million of its own shares (KRW0.3 trillion), representing 2.5 percent of its outstanding shares, within three months for cancellation. KT&G will be cancelling its own shares for the first time in 14 years.
In addition, the company declared its first-ever interim cash dividend of KRW1,200 per share. The interim dividend is scheduled to be paid out by Aug. 23. Including the interim dividend, the total dividend per share is expected to increase by at least KRW200 per share compared to last year’s KRW5,000.
August 3, 2023
New BAT Boss Calls for ‘Better’ Vaping Rules

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The newly appointed head of BAT has urged governments to apply “better regulations” toward vaping products and other tobacco alternatives.
Tadeu Marroco told the Financial Times that BAT is “very keen” to work with regulators to address problems such as underage vaping and the environmental impact of e-cigarettes.
“We need to have better regulations. We cannot ignore the benefit of migrating smokers out of cigarettes, but being unregulated, we have issues related to youth access and the environment,” Marroco said.
“The problem is that this is a phenomenon that has grown so fast, and the regulators are always catching up. But there are clearly opportunities for us to improve the level playing field.”
Since Marroco took the helm in May of this year, there has been an increased push around the globe to restrict flavored e-cigarettes, due in part to advice from anti-nicotine groups and the World Health Organization. India, Thailand and Argentina have all banned vaping products.
U.K. National Health Service guidelines suggest vapes can help people stop smoking, although they also state that the activity “is not completely risk-free.” The government said in April that it would offer 1 million smokers vape starter kits. Selling vapes to under-18s is illegal.
August 3, 2023
Manila Rolls Out Red Carpet for HTP Makers

Photo: PMI
The Philippines’ Department of Trade and Industry (DTI) is urging tobacco companies to manufacture their heated tobacco products in the country, citing surging domestic demand and export opportunities, according to the Philippine News Agency.
During the International Tobacco Agriculture Summit in Taguig City on Aug. 2, DTI Undersecretary Ceferino Rodolfo said while local demand for cigarettes is expected to decline from 49.61 billion sticks in 2022 to 39.06 billion sticks in 2027, sales of HTPs are poised to increase significantly during that period.
He cited a Euromonitor predicting HTP retail sales of HTPs to surge by 511 percent to 4.06 billion sticks in 2027.
Rodolfo said HTP producers would benefit the Philippines’ free trade agreements with regional markets. “HTPs, if manufactured in the Philippines, can be imported in ASEAN (except Vietnam), Australia, New Zealand, Japan, Korea, and Hong Kong at zero percent tariff duty,” he was quoted as saying.
In 2022, the top destinations for Philippine tobacco products included South Korea at $102.2 million, Thailand ($98.29 million) and Myanmar at $49.4 million.
According to Rodolfo, Philip Morris Fortune Tobacco aims to build a PHP9-billion factory in Tanauan, Batangas, for the production of IQOS devices.
August 3, 2023
Strong Start for Universal’s Tobacco

Photo: Taco Tuinstra
Universal Corp. reported sales and other operating revenue of $517.7 million in the three months that ended June 30, 2023, up 20 percent over that posted during the same period last year. Operating income declined 17 percent to $11 million.
Tobacco operations sales and other operating revenues jumped 28 percent to $443.9 million, while Tobacco operations operating income increased 9 percent to $8.9 million.
“Our tobacco operations performed well and are off to a good start for our fiscal year 2024,” said Universal Corp. Chairman, President and CEO George C. Freeman III in a statement.
“Segment operating income was higher for our tobacco operations segment in the quarter ended June 30, 2023, compared to the quarter ended June 30, 2022, even though we did not have the benefit of large shipments of carryover tobacco from certain origins that we had in first quarter of fiscal year 2023.
“Demand for leaf tobacco from our customers remains strong, and our level of uncommitted tobacco inventory was 16 percent of tobacco inventory at June 30, 2023. We are forecasting increased leaf tobacco production in fiscal year 2024, compared to fiscal year 2023, and believe that even with that increased production, leaf tobacco will remain in an undersupply position.”
Freeman also expressed satisfaction with the progress Universal has made integrating its plant-based ingredients platform. He attributed soften-than-expected demand in this segment to high customer inventory levels, but anticipated this situation to be temporary.
“We believe that we are well-positioned to capitalize on demand from our customers, and that with the investments we are making, we are a stronger partner for current and future customers due to the expanded range of capabilities and products that we can offer them,” said Freeman.
August 3, 2023
Juul Seeking $1 Billion in Funding

Photo: Lamppost
Juul Labs is seeking to raise about $1 billion, reports Bloomberg News
The e-cigarette manufacturer, which had about $800 million in revenue in 2022, is reportedly working with Jefferies Financial Group for the fundraising.
In July, the company said it was exploring options including financing alternatives, to protect its business and help refinance an existing loan, as it dealt with lawsuits related to the marketing of its e-cigarettes.
In November 2022, Juul secured a cash infusion to keep the company in business while it appeals the U.S. Food and Drug Administration’s marketing denial order related to its vapor products.
A pioneer in the vaping business, Juul Labs has gone from dominating the U.S. e-cigarette market to fighting for its survival in a relatively short time.
Following its initial success, the company quickly came under regulatory scrutiny over its marketing practices. Critics blame Juul Labs for contributing to an “epidemic” of underage vaping.
August 3, 2023