Category: News This Week

Juul Labs Cuts Valuation Again
Juul Labs has cut its valuation to about $10 billion from $12 billion at the end of last year, reports Reuters.
Juul was valued at $38 billion in December 2018, when Altria Group took a 35 percent stake in the company.
The latest write down follows recent decisions to exit certain markets and related restructuring costs, according to the memo sent to Juul employees by chief executive officer K.C. Crosthwaite.
“Today’s valuation does not surprise me, and I expect other investors to also arrive at lower valuation marks that factor in our recent restructuring,” he reportedly said.
Juul has faced heightened regulatory scrutiny following a rise in teenage vaping and a ban on the sale of popular flavors.
In September, the company said it would make a significant cut to its global workforce and explore pulling out of some European and Asia-Pacific markets to save cash.
Earlier this month, the company announced its exit from Germany.
October 30, 2020
Japan: Smoking Drops to Record Low

Photo: Colleen Williams
Japan’s smoking rate fell to a record low last year, reports NHK World, citing to a government survey.
The health ministry surveyed about 5,700 people aged 20 or over last November.
The percentage of men and women who regularly smoke stood at 16.7 percent. That’s down 1.1 percentage points from a year earlier, and the lowest since the survey began in 1986.
The ratio for men was 27.1 percent, down 11.1 points over the past decade. The figure for women was 7.6 percent, down 3.3 points over the same period.
During the recent virtual Global Tobacco & Nicotine Forum, experts attributed Japan’s rapid decline in traditional smoking to the emergence of heated tobacco products.
Of male smokers who participated in the recent survey, 27.2 percent said they use heated tobacco products, while 25.2 percent of female smokers said they do so.
The health ministry aims to lower the smoking rate to 12 percent by fiscal 2022.
October 30, 2020
FDA Draft Guidance for Perception Studies
Photo: Jhvephotos | Dreamstime.com
The U.S. Food and Drug Administration (FDA) has released a draft guidance for tobacco product perception and intention (TPPI) studies. The studies must be submitted as part of a modified risk tobacco product application, a premarket tobacco product application or a substantial equivalence report.
The guidance is aimed at helping applicants design and conduct the studies that can be used to assess, among other things, individuals’ perceptions of tobacco products, understanding of tobacco product information (e.g., labeling, modified risk information), and intentions to use tobacco products.
It is possible for a TPPI study to also include an actual use component (e.g., an actual product utilized in a simulated use setting or a real environment of use); however, a discussion of actual use research is beyond the scope of this draft guidance, according to the FDA.
This draft guidance addresses the following scientific issues for applicants to consider as they design and conduct TPPI studies to support tobacco product applications:
Developing TPPI study aims and hypotheses
Designing quantitative and qualitative TPPI studies
Selecting and adapting measures of TPPI study constructs
Determining TPPI study outcomes
Selecting and justifying TPPI study samples
Analyzing TPPI study results
The agency is accepting public comments related to the draft guidance through Dec. 28. The application deadline was Sept. 9 for deemed new tobacco products that were on the market as of Aug. 8, 2016, and the FDA said it intends to make a public list of what products were submitted on time.
October 29, 2020
Imperial Completes Sale of Cigar Business

photo: Image by Chris Frenzel from Pixabay
Imperial Brands completed the sale of its worldwide premium cigar businesses for a total consideration of €1.23 billion ($1.4 million) of which net cash proceeds of €1.1 billion will be used to reduce debt, the company announced on its website.
As announced on April 27, 2020, €88 million of consideration will be deferred for 12 months from today’s close, with a further €69 million deferred and contingent upon the transfer of the Dominican Republic factory, which is expected to complete in 2021. As subsequently announced on Sept. 28, Imperial has provided a further six-month deferral of €250 million while the buyers finalize long-term financing arrangements.
October 29, 2020
Premium Tobacco Launches Website

Photo: OpenClipart-Vectors from Pixabay
The Premium Tobacco Group’s website, www.premiumtobaccogroup.com, is now up and running.
Following the company’s steady growth in recent years, Premium Tobacco’s management decided a website was warranted to illustrate the group’s operations. Among other things, the website highlights the compliance and sustainability policies that the group rigorously adheres to in all its origins.
“The group’s board is proud of the achievements of all employees and stakeholders in delivering year on year growth and wanted to provide a platform where these achievements could be shared,” Premium Tobacco wrote in a statement.
October 29, 2020
KT&G Receives High Marks for Governance

Photo: KT&G
KT&G has obtained a Grade A in the environment, social and governance (ESG) evaluation conducted by Morgan Stanley Capital International (MSCI).
Every year, MSCI evaluates about 8,500 listed companies worldwide by dividing them into different types of businesses and rating their business status related to the environment, social responsibilities, and corporate governance in the range of AAA to CCC. This year, KT&G was evaluated along with 11 global tobacco companies.
This year’s grade is one level up from last year’s BBB.
Last year, KT&G obtained an A+ for the second consecutive year and won the “Grand Prize” in the domain of governance in the ESG evaluation performed by the Korea Corporate Governance Service in recognition of its establishment of an excellent sustainable management system.
The company has also been publishing the KT&G Report since 2007 to deliver transparent and accurate ESG information to domestic and overseas stakeholders as well as share various social responsibility activities with them.
October 29, 2020
TPB Raises Guidance After Strong Quarter

Image by Steve Buissinne from Pixabay
Turning Point Brands (TPB) reported net sales of $104.2 million in the third quarter of 2020, up 7.6 percent over those of last year’s third quarter.
Gross profit increased 12.8 percent to $48.3 million. Net income increased $1.5 million to $7.8 million, despite PMTA costs incurred during the current quarter.
Adjusted EBITDA increased 27.4 percent to $23.9 million.
“Streamlining and repositioning the business at the end of 2019 has paid dividends throughout 2020,” said Larry Wexler, president and CEO of TPB, in a statement.
“Smokeless saw continued same store sales momentum in MST and newfound strength in loose leaf chewing tobacco. Smoking (Zig-Zag) saw its highest growth rate in recent history driven by product and channel growth initiatives behind rolling papers, the benefits of greater control of our MYO cigar wraps business after the Durfort transaction closed in the second quarter, and a burgeoning e-commerce presence, he said.
“The NewGen segment navigated admirably through significant market disruption caused by the PMTA application deadline, said Wexler. “Overall, we are seeing ongoing benefits from reshaping our business towards a more growth-oriented mindset and are able to raise our outlook once again for the remainder of the fiscal year.”
TPB also revised its 2020 guidance provided on July 28, 2020. Absent any further acquisitions, the company projects 2020 net sales to be between $395 million and $401 million, up from previous guidance of $370 million to $382 million.
October 28, 2020
Taat Starts Commercial-Scale Production

Photo: Taat Lifestyle and Wellness
Taat Lifestyle & Wellness’ contract manufacturing partner has begun commercial-scale production after receiving a supply of Beyond Tobacco base material from the company.
This batch will be packaged using an updated Taat pack design, similar to the provisional pack designs published in September. Beginning in November 2020, when initial production of Taat is expected to be completed, inventory of Taat is to be shipped from the manufacturer’s warehouse to tobacco wholesalers in Ohio, who will then be able to fulfill orders for Taat from tobacco retailer accounts in the convenience channel.
Beyond Tobacco is the nicotine-free and tobacco-free base material of Taat, an alternative to traditional cigarettes, the company explained in a press note. Taat has been engineered to closely replicate every aspect of the cigarette-smoking experience, including a combustible stick format, cigarette-style packaging, an enhanced volume of smoke exhaled, and a taste and smell similar to tobacco attained by way of a patent-pending refinement technique.
October 28, 2020
Turning Point Invests in Cannabinoid Business

Photo: Herbal Hemp from Pixabay
Turning Point Brands (TPB) will invest $15 million Dosist, a global cannabinoid company. It has also signed an exclusive co-development and distribution agreement for a new CBD brand, created in partnership with Dosist’s THC-free business unit.
TPB has an option to invest another $15 million at predetermined terms within the next 12 months.
“The cannabis market is exploding, and now is the opportune time to invest in the space and significantly expand our addressable market,” said Larry Wexler, CEO of TPB, in a statement. “With its leadership in results-oriented plant-based formulas and dose control technology, global recognition, consumer trust and scalability, Dosist was the clear choice to be our new partner in this critical growth market.”
“We are extremely proud to partner with Turning Point Brands on our next phase of growth and distribution as we continue to transcend the way consumers think about their health and wellness,” said Gunner Winston, CEO of Dosist. “Turning Point’s leadership team has demonstrated remarkable foresight and vision about the future and opportunity for federally legal cannabinoid products. The synergy between our brands around this scope and mission is incredible and we are excited by what we will achieve together with this partnership.”
Dosist’s cannabis products are currently available in California, Colorado, Nevada and Canada, serving a total dispensary network of more than 700 stores. The company has plans to launch into key new markets in the coming months, adding geographies as they continue their North American expansion.
October 28, 2020
Record Quarter for Swedish Match

Photo: Swedish Match
Swedish Match reported record sales and operating profit from product segments in the third quarter of 2020.
Sales and operating profit increased for the Smokefree and Cigars segments in both the U.S. and Scandinavia, elevated by Covid-19 related effects on consumer demand and channel shifts.
In local currencies, sales increased by 23 percent for the third quarter. Reported sales increased by 15 percent to SEK4.4 billion ($504 million).
In local currencies, operating profit from product segments increased by 37 percent for the third quarter. Reported operating profit from product segments increased by 28 percent to SEK2.05 billion
Operating profit amounted to SEK2.02 billion for the third quarter.
Profit after tax, which includes a charge of SEK286 million following adverse ruling in a tax case, amounted to SEK1.19 billion for the third quarter.
Lars Dahlgren
“Swedish Match delivered an outstanding performance during the third quarter,” said CEO Lars Dahlgren, CEO of Swedish Match in the company’s quarterly report. “While we estimate that Covid-19 related effects had a notably positive net impact on group earnings, the underlying financial development across our product segments was strong.
“Impressive performance for Zyn in the U.S. continued to be the key contributor to profit growth. For this quarter we also noted a significant upturn in operating profit for our U.S. cigar business, as well as for our Scandinavian smokefree business—even when excluding Covid-19 related positive mix effects from increased domestic volumes in Norway that substituted deliveries to border trade and travel retail outlets.”
October 27, 2020