Category: News This Week

Bloomberg Commits Millions to Tobacco Control

Photo: Elenathewise
Bloomberg Philanthropies has committed another $420 million over four years to the Bloomberg Initiative to Reduce Tobacco Use. This fourth investment brings Bloomberg’s total commitment to tobacco control to more than $1.58 billion since 2005.
The Bloomberg Initiative to Reduce Tobacco Use is helping cities and countries implement measures such as smoke-free public places, banning tobacco advertising, increasing tax on tobacco products, requiring graphic warnings on cigarette packaging and mass-media public awareness campaigns.
Currently, the initiative spans more than 110 low- and middle-income countries (LMICs)—including China and India, which together account for nearly 40 percent of the world’s smokers.
From the new $420 million in funding, $280 million will be aimed at reducing tobacco use in LMICs and $140 million will target reducing e-cigarette use among teenagers in the United States.
“Over the past two decades, we’ve made major progress in reducing tobacco use and the death and disease connected to it, but it continues to take a devastating toll, and it remains the leading cause of preventable death,” said Michael R. Bloomberg, founder of Bloomberg Philanthropies and WHO Global Ambassador for Noncommunicable Diseases and Injuries, in a statement.
“This latest investment will help to spread strategies that have proven so effective at saving lives — including smoke-free laws and advertising restrictions—to more nations and communities around the world.”
February 3, 2023
Iranian Tobacco Co. to Build in Zimbabwe

Photo: www.akolosov.art
The Iranian Tobacco Co. (ITC) will build a cigarette factory in Zimbabwe, reports Press TV.
According to local media reports, ITC CEO Mohammad Sheikhan and Zimbabwe’s agriculture minister, Anxious Jongwe Masuka, signed an agreement in Harare on Jan. 26.
The facility will manufacture ITC’s Bahman brand using Zimbabwean leaf tobacco. As part of the agreement, Zimbabwe will also supply tobacco for cigarette manufacturing in Iran or for re-exports to Central Asia.
Other Iranian-made cigarette brands will be exported to Zimbabwe under the deal.
Iran’s tobacco sector has grown in recent years amid lower imports of international brands and increasing demand for local products.
The boom has enabled the ITC to revive idle plants and to start exporting to several countries in West and Central Asia.
The company’s planned cigarette factory dovetails with Zimbabwe’s ambition to move up the tobacco value chain. While the country exports hundreds of millions of kg of leaf each year, most of the value is captured by the buyers who process the tobacco into consumer products.
The country aims to generate US$5 billion from tobacco by 2025, up from US$1 billion today.
February 3, 2023
Arthur J. Schick Jr. Joins Universal Board

Image: Tobacco Reporter archive
Arthur J. Schick Jr. will join Universal Corp.’s board of directors on April 1, 2023, at which time the board will expand to nine directors, eight of whom are independent, according to the company.
“We are thrilled to welcome Art Schick to our board of directors,” said George C. Freeman III, chairman, president and CEO of Universal Corp. “Art is an experienced, well-respected global consumer products executive with in-depth knowledge of the food and beverage industry, and he has deep-rooted expertise and knowledge of the ingredients industry from the top down. He brings tremendous value to Universal, with over four decades of experience in ingredients, strategic supplier development, procurement, operations, international supply chain management and product research and development.”
Schick is a 35-year veteran of PepsiCo, where he served his last 17 years as the vice president of proprietary flavors within the beverage concentrate division. In that role, Schick led PepsiCo’s organization that manufactured all proprietary flavors for the company’s global beverage brands and led the global sourcing strategies and supply chain management for the organization. Schick also spent over a decade as a contributing board member for the Flavor Extract Manufacturers Association (FEMA), the premier national association of the U.S. flavor industry, serving as FEMA’s president in 2013. Schick currently serves as president of Alpha Sierra Global, a company providing strategic and operational consulting to companies focused on consumer products, flavor compounding and ingredients.
“When presented with the opportunity to serve on Universal’s board of directors, I was impressed with the company’s long and successful history in international tobacco operations, and I was excited about the tremendous upside potential for the company as it expands its plant-based ingredients platform,” said Schick. “Universal already has a strong foundation and sustainable strategy to position itself as a leader in the ingredients space. I look forward to working with my fellow directors and the company’s management team as Universal charts its course for a bright future.”
February 2, 2023
Essentra Filters Rebrands as Filtrona
Following the announcement about a change of ownership, the former filters and tapes businesses of Essentra will now begin the process of rebranding as Filtrona.
“This is an exciting time for our business, marking a new chapter in our journey to build a global market-leading company that supports our partners to transform and grow,” said Filtrona CEO Robert Pye in a statement.
“Many of our customers and suppliers will know that Filtrona was the company name prior to rebranding to Essentra plc. Having talked to them about our plans, it was clear that the Filtrona name represented a rich history of innovation and partnership. It was only right that we adopted the brand again, which had such a strong foundation, and gave it a fresh contemporary design to take us forward.”
With its rebrand well underway, the business enters 2023 with exciting plans for the future.
“Both the tobacco and packaging industries are focused on driving innovation in response to ever-changing consumer preferences,” says Pye. “Our customers therefore need global partners that are investing in the future of their business.
“At Filtrona, we now have a truly global presence with facilities in all major markets worldwide supported by a 2,000-strong team of talented employees working across our 11 manufacturing locations, 3 innovation centers, an accredited laboratory and a center of excellence focused on sustainability. Our mission is to be a responsible, customer-focused innovation leader creating excellence in sustainable solutions for today and tomorrow. We look forward to delivering on this commitment.”
“We are delighted to welcome Filtrona into our diverse portfolio,” said a representative of the new shareholder. “The business has a rich heritage in providing innovative solutions to a well-established customer base with a global footprint, high quality people and exciting prospects. We continue to support our partners through the next phase of growth relying on our combined expertise in identifying and unlocking value creation opportunities.”
February 2, 2023
Survey Details Advocacy for Safer Nicotine

Image: Andrii Yalanskyi | Adobe Stock
Knowledge-Action-Change (KAC) has released a global survey investigating the role and activities of consumer organizations advocating for access to safer nicotine products (SNPs) and tobacco harm reduction.
Carried out by KAC’s Global State of Tobacco Harm Reduction project, the research was published in Public Health Challenges.
It reveals that there are 54 active consumer advocacy groups working around the world to raise awareness about, and promote the availability of and access to, SNPs, which include nicotine vaping products (e-cigarettes), Swedish-style snus, nicotine pouches and heated-tobacco products.
The authors of the survey found that the vast majority of organizations (42) were operated entirely by volunteers, most of whom had successfully quit smoking with the help of SNPs.
Only seven of the groups had any contracted or paid staff (13 people globally), and for the last full year, the total funding for all organizations surveyed amounted to $309,810. This is in stark contrast to the millions of dollars spent on campaigns by actors, such as Bloomberg Philanthropies, seeking to limit access to SNPs, such as nicotine vaping products. The paper also notes that none of the consumer advocacy organizations reported receiving funding from tobacco or pharmaceutical companies.

This paper starkly demonstrates the major imbalance in resources available to consumer organizations advocating for access to safer nicotine products and those opposed to tobacco harm reduction, unfairly skewing the debate.
Gerry Stimson, director, KAC
Many of these organizations are members of four regional umbrella organizations covering Latin America (ARDT Iberoamerica), Africa (CASA), Europe (ETHRA) and Asia-Pacific (CAPHRA).
“This survey offered a unique opportunity to map these advocacy organizations for the first time and provide valuable insight into how they are operating all over the world,” said Tomasz Jerzynski, lead author and data scientist for the Global State of Tobacco Harm Reduction project. “The sustainability of these organizations is one of the main concerns that has come out of the data. All of these groups face challenges due to their small numbers of core workers and their dependence on volunteers.”
“This paper starkly demonstrates the major imbalance in resources available to consumer organizations advocating for access to safer nicotine products and those opposed to tobacco harm reduction, unfairly skewing the debate,” said Gerry Stimson, report author, director of KAC and emeritus professor at Imperial College London. “It also highlights why consumer groups must be recognized as legitimate stakeholders in the policy sphere.”
February 1, 2023
PMI, BAT Recognized for Gender Equality

Image: melita | Adobe Stock
Philip Morris International and BAT were included in the 2023 Bloomberg Gender-Equality Index (GEI).
PMI made the index for the third year running, achieving an overall score of 80.6 percent.
“Achieving gender balance at all levels of the company is one of our top priorities, and I am delighted that our efforts are recognized again in this year’s index,” said Silke Muenster, chief diversity officer at PMI. “While we are making significant progress, we know we need to keep our foot on the acceleration pedal. An inclusive workplace that leverages the full talents of both women and men is crucial to our smoke-free vision, making our organization more innovative, resourceful and engaged.”
In 2022, PMI achieved its target of ensuring at least 40 percent female representation in managerial roles and announced a new target to achieve 35 percent of women in senior roles by the end of 2025, among other targets.
BAT, which participated in the index for the first time, received a score of 75 percent. BAT was recognized for creating an inclusive culture for women via its recruiting initiatives, adoption of family-friendly policies, sponsoring programs dedicated to educating women, and support of community programs. Inclusion in the index follows BAT being named as a Global Top Employer for a sixth successive year.
“Recognition in this year’s Bloomberg Gender-Equality Index demonstrates our commitment to addressing gender diversity and highlights our concerted global efforts to provide transparent reporting,” said Hae In Kim, BAT’s director of talent, culture and inclusion. “With more than 50,000 employees worldwide, our diversity and inclusion strategy is truly global, and I continue to be incredibly proud of the collective efforts made by all our employees.”
The GEI measures gender equality performance globally across five pillars as set by Bloomberg: leadership and talent pipeline, equal pay and gender pay parity, inclusive culture, anti-sexual harassment policies, and external brand. The 2023 Bloomberg GEI comprises 485 companies from 45 countries and regions.
February 1, 2023
Trade Group: Cigar Flavor Ban Harmful

Image: pureradiancecmp
Banning flavored cigars would do more harm than good, according to David Ozgo, president of the Cigar Association of America, reports The Center Square.
“The economic impact is one thing, but just as important is the fact that what you’re doing is taking away an adult’s right to choose,” Ozgo said. “When President [Barack] Obama passed legislation in 2009 regulating tobacco, he stressed the idea was not to take away an adult’s right to use tobacco if that’s what they choose.”
In 2021, flavored cigars made up 47 percent of the market, so banning them would have a huge economic impact, according to Ozgo. He projects losses of about $4 billion in retail sales, 16,000 jobs, $840 million in wages and an estimated $750 million in federal, state and local tax revenue.
“The proposed rules would help prevent children from becoming the next generation of smokers and help adult smokers quit,” Health and Human Services Secretary Xavier Becerra said in a statement on the U.S. Food and Drug Administration’s website. “Additionally, the proposed rules represent an important step to advance health equity by significantly reducing tobacco-related health disparities.”
Ozgo countered that it’s already illegal for a person under 21 to purchase tobacco. Government data shows less than 1 percent of youth use flavored cigars, he noted.
“This is a solution in search of a problem,” Ozgo said. “When you look at indicators of nicotine addiction, they’re not the same as, say, cigarettes. Really, people smoke cigars for different reasons. With cigars, it’s just something you do to relax and enjoy. We always say cigars are more of a hobby than a habit; you don’t even smoke one every day.”
February 1, 2023
KT&G Refuses Ginseng Spinoff

Photo: KT&G
KT&G has refused to spin off its ginseng business as requested by activist investor Flashlight Capital Partners, reports The Korea Herald.
“The spinoff will have little to no benefit to the company’s corporate value and shareholders from a long-term perspective,” KT&G Senior Executive Vice President Bang Kyung-man said.
Bang expressed concern that KT&G would potentially lose “synergy” in the event of the ginseng unit’s separation.
Flashlight Capital Partners has been putting pressure on KT&G to increase dividends and spin off its ginseng unit into a separate listing, among other things.
KT&G plans on initiating a share buyback program and aims to increase its overseas sales to over half by 2027. To raise the needed capital, KT&G can sell property assets and borrow from banks, according to Bang.
February 1, 2023
U.S. Cigarette Sales Down in 2020-2021

Photo: www.akolosov.art
The number of cigarettes that the largest cigarette companies in the United States sold to wholesalers and retailers nationwide decreased from 203.7 billion in 2020 to 190.2 billion in 2021, according to the Federal Trade Commission’s most recent Cigarette Report. The report also states that in 2021, menthol flavored cigarettes comprised 37 percent of the market among major manufacturers, more than double the 16 percent market share they held in 1963.
The amount spent on cigarette advertising and promotion increased from $7.84 billion in 2020 to $8.06 billion in 2021. Price discounts paid to cigarette retailers ($6.01 billion) and wholesalers ($917 million) were the two largest expenditure categories in 2021. Combined spending on price discounts accounted for 86 percent of industry spending.
According to the Smokeless Tobacco Report, smokeless tobacco sales decreased from 126.8 million pounds in 2020 to 122 million pounds in 2021. The revenue from those sales rose from $4.82 billion in 2020 to $4.96 billion in 2021. Menthol flavored smokeless tobacco products comprised more than half of all sales and fruit flavored smokeless tobacco products comprised 2.7 percent.
Spending on advertising and promotion by the major manufacturers of smokeless tobacco products in the U.S. increased from $567.3 million in 2020 to $575.5 million in 2021. As with cigarettes, price discounts made up the two largest spending categories, with $308.2 million paid to retailers and $81.3 million paid to wholesalers in 2021. Combined spending on price discounts represented 67.7 percent of all industry spending.
Smokeless tobacco manufacturers also reported selling $804.8 million of nicotine lozenges or nicotine pouches in 2021, not containing tobacco, up from $422.7 million in 2020.
The Commission has issued the Cigarette Report periodically since 1967 and the Smokeless Tobacco Report periodically since 1987.
February 1, 2023
Altria Group Reports 2022 Results

Photo: Altria Group
Altria Group reported net revenues of $6.11 billion for the fourth quarter of 2022 and net revenues of $25.1 billion for the full year, down 2.3 percent and 3.5 percent, respectively, from the comparable periods of 2021. Revenues net of excise taxes were down 0.1 percent for the quarter and up 2 percent for the full year, to $5.08 billion and $20.69 billion, respectively.
“It was an exciting year for Altria as our businesses delivered strong financial performance, and we continued to strategically invest toward our Vision,” said Altria CEO Billy Gifford in a statement. “We generated strong adjusted diluted EPS growth of 5 percent and made meaningful progress in several areas of our smoke-free portfolio.”
“Our plans for 2023 include a continuation of our strategy to balance earnings growth and shareholder returns with strategic investments toward our Vision. We expect to deliver 2023 full-year adjusted diluted EPS in a range of $4.98 to $5.13, representing a growth rate of 3 percent to 6 percent from a base of $4.84 in 2022.”
Like other tobacco companies, Altria was impacted by high rates of inflation in 2022, which reduced adult tobacco consumers’ discretionary income and spending. “As a result, our businesses and the industry experienced elevated volume declines, and we observed accelerated share growth in discount cigarettes. Despite these factors, our leading tobacco brands remained resilient and we continued to observe significant brand loyalty in the tobacco space overall,” the company wrote on its website.
While Marlboro’s retail share of the total U.S. cigarette category dropped 0.4 points to 42.5 percent in 2022, the brand gained 0.5 points in the premium segment, claiming 58.2 percent of that category.
Altria Group also revised the valuation of its stake in Juul Labs, which has faced considerable regulatory and legal challenges. As of Dec. 31, 2022, the investment was worth $250 million, according to Altria.
February 1, 2023