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Category: Business & Finance

  • Imperial’s CEO, Bomhard, Retires

    Imperial’s CEO, Bomhard, Retires

    Imperial Brands announced today (May 14) that CEO Stefan Bomhard will retire after five years in the job. He will continue to serve on the company’s board until December 31 and be available until May 2026 to support the transition. Chief financial officer Lukas Paravicini will be promoted to CEO October 1.

    “While Bomhard’s retirement is disappointing, this doesn’t imply any change to the plans laid out at the company’s recent investor event,” Panmure Liberum analyst Rae Maile wrote. “The transition will be seamless given Paravicini’s skills.”

    Paravicini, CFO since May 2021, has been instrumental in driving consistent growth over the past four years and leads the long-term program to transform the company’s tech and data capabilities, the company said. Chief strategy and development officer, Murray McGowan, will replace Paravicini as CFO.

    With the news, Imperial’s shares dropped more than 7% as investors reacted to the unexpected loss of a leader credited with turning the company around. The company recently reported a 1.8% rise in first-half adjusted operating profit and reaffirmed its annual forecast after reporting market share growth in its five priority markets.

    “Prior to Bomhard’s arrival, Imperial had lost market share in its core tobacco business and failed to gain any real traction with new products like vapes, resulting in years of missed sales targets and a 2020 write-down,” Shashwat Awasthi and Emma Rumney wrote for Reuters. “Bomhard restored that market share, sales growth, and healthy investor returns by retreating to focus on traditional tobacco in Imperial’s key markets.

    “He also fine-tuned the company’s strategy on smoking alternatives – a portfolio which delivered double-digit growth in the first half of this year.”

    Paravicini told investors on an analysts’ call he was committed to Imperial’s five-year strategy set out in March and a capital allocation framework based around healthy returns for shareholders. Under that strategy, Paravicini is tasked with stepping up growth in smoking alternatives, where Imperial lags competitors, and compounding progress on tobacco in difficult markets like Germany, where Imperial has struggled to regain lost share amid stiff competition.

    Bomhard said he did not plan to take any other executive role and was retiring, and that his departure was “a very personal decision” related to freeing up personal time for himself and his family after 11 years leading large UK companies. He was previously CEO of car distributor and held senior roles at Unilever and Bacardi.

  • Philippines’ Vape Stamp System Working 

    Philippines’ Vape Stamp System Working 

    The Bureau of Internal Revenue (BIR) says the Philippine government’s crackdown on illicit trade is working, collecting P942 million ($17 million) in excise taxes on 130 million milliliters of vape products in the six months since the vape stamp system was introduced. In 2023, those numbers were only P224 million ($4 million) and 11.2 million milliliters for the year.

    Tax authorities vowed to intensify efforts to catch and charge noncompliant players in the growing vape market.

    “There will be no letup in our fight against illicit trade,” BIR commissioner Romeo Lumagui Jr. said. “Just recently, we filed criminal cases against importers of vape products. This shows that the campaign against the illicit trade in vape products is continuous, and we will not stop until we address this issue.”

    The BIR chief was referring to tax evasion cases filed in April against large-scale illicit vape businesses for failure to pay P8.68 billion ($156 million) in taxes. The charges involved illegal vape traders selling the brand names Flava, Denkat, and Flare. The BIR also recently combined with the Bureau of Customs to destroy P3.26 billion ($58.7 million) of seized vape products.

    Lumagui said BIR’s efforts extend beyond distributors and importers.

    “All those involved in the trade of untaxed vape products, including sellers, endorsers, and influencers, could face tax evasion charges under the tax code,” he said.

  • Philippine Government Urged to Fight Illicit Trade with Lower Taxes 

    Philippine Government Urged to Fight Illicit Trade with Lower Taxes 

    As the Philippine government is making progress against illicit vape products with tax stamps, the Philippine Tobacco Institute (PTI) suggests it lower tax rates on cigarettes to replenish its declining revenues as the price disparity between legal and illicit products worsens. Last year, illicit tobacco incidence reached a record 18.2%.

    PTI said tax policies and illicit trade are inextricably linked as the organization pushes for the recalibration of tobacco excise taxes and enhancement of enforcement and prosecution efforts. It issued the call days before the Senate Committee on Ways and Means discusses House Bill 11360, which seeks to adopt an odd-even scheme in hiking the tobacco excise taxes: 2% every even-numbered year and 4% every odd-numbered year until 2035. The current tobacco excise tax rate increases by 5% annually, with a base tax of P60 ($1.08) per pack.

    PTI president Jericho Nograles argued that overly aggressive or automatic tax hikes can incentivize illicit trade. He said higher taxes widen the price gap between legal and illegal products, thus increasing the profitability of smuggling and counterfeiting. PTI said tax revenue continues to decline while smoking incidence increases, meaning people are switching products, that can cost P40 (72 cents) per pack versus P140 ($2.52) for legitimate ones.

     “The automatic tax hikes have resulted in declining government revenues,” Nograles said. “Our position is that if Congress lowers the rates and the government steps up in enforcement, then there would likely be better collections and revenues. It would not only be acceptable, but a win-win for industry and government when illicit trade in tobacco is stopped.”

  • Already Struggling with Illicit Trade, Pakistan Being Pushed to Raise Tobacco Taxes 

    Already Struggling with Illicit Trade, Pakistan Being Pushed to Raise Tobacco Taxes 

    Pakistan’s Federal Board of Revenue (FBR) chairman, Rashid Mahmood Langrial, said massive tax evasion in the tobacco sector is costing the country’s economy nearly Rs300 billion ($1.1 billion), and that, because of limited manpower, only one out of 10 trucks carrying illicit cigarettes is caught.

    Langrial said the FBR is working to train and empower local law enforcement agencies within the provinces to battle illicit trade at the retail level, and that any cigarette without a mandatory stamp is illegal and subject to seizure.

    This comes at a time when the leading legal cigarette manufacturers in Pakistan are reporting significant decreases in sales volumes, presumably because the government placed a 200% Federal Excise Duty (FED) on all brands of cigarettes in the budget for the 2025-2026 fiscal year. Still, sources told Business Recorder that the FBR is facing strong international pressure from the World Health Organization to raise the FED further.

  • Vietnam’s Cigarettes “Too Affordable”

    Vietnam’s Cigarettes “Too Affordable”

    Between 2010 to 2022, Vietnam’s per capita income increased by 203%. Cigarette prices, however, only rose by 56%, making tobacco too affordable and encouraging consumption, Phan Thi Hai, deputy director of the Tobacco Harm Prevention Fund under the Ministry of Health said. She said Vietnam raised smoking taxes three times between 2008 and 2019, but the increases were so small they had no effect on smoking rates.

    “Vietnam’s cigarette prices remain among the lowest globally, making them easily accessible, especially to low-income groups and youth,” Hai said. She said even with the country’s 75% “special consumption tax” on tobacco products, a pack of cigarettes with a factory price of 3,900 VND (15 cents) ends up costing the consumer only 10,000 VND (39 cents). She also said in Hanoi and HCM City, there are still about 40 cigarette brands priced below 10,000 VND per pack, some as low as 7,000–8,000 VND (27 to 31 cents).

    Hai said to effectively reduce tobacco consumption, Vietnam must reform its tobacco tax policy by implementing a steady tax increase over time. This would ensure that cigarette prices keep pace with income growth and gradually approach the tax level recommended by the WHO. She proposed introducing an absolute tax of at least 5,000 VND (20 cents) per pack by 2026, increasing to 15,000 VND (60 cents) per pack by 2030, which theoretically would help reduce the adult smoking rate to below 36% for men and below 1% for women, consistent with the targets of the National Tobacco Control Strategy by 2030.

    Currently, the total tax share in the retail price of cigarettes in Vietnam is only 36%, below the WHO’s recommended 75% and lower than regional peers such as Thailand (78.6%), the Philippines (71.3%), and Singapore (67.5%).

  • 22nd Century Sees 50% Jump from Q4 2024 to Q1 2025

    22nd Century Sees 50% Jump from Q4 2024 to Q1 2025

    22nd Century Group, Inc. today (May 13) announced results for the first quarter, ended March 31, and provided an update on recent business highlights. Compared to the fourth quarter 2024, first quarter 2025 saw net revenues increase from $4 million to $6 million and gross profit losses declined from $1.3 million to $600,000. Operating expenses decreased from $2.8 million to $2 million, the lowest quarterly amount since company restructuring began in 2023, and operating losses decreased from $4.1 million to $2.6 million.

    “Our first quarter results demonstrate the positive trends we expect to build on in 2025 as we secure new opportunities to drive volume across our VLN, core CMO and filtered cigar businesses, with a particular emphasis on leveraging both our own and customer driven campaigns for partner branded products,” said Larry Firestone, CEO of 22nd Century Group. “We are excited about the upcoming launch of now two partner-branded VLN products, both for chains with substantial retail store counts, bringing additional partner-supported marketing and outreach activity to grow sales volumes in the VLN category. We are moving ahead on these and other opportunities ahead as we continue to execute our growth strategy in 2025.”

    View the full financial report here.

  • Zimbabwe, Philippines Create Tobacco Pact 

    Zimbabwe, Philippines Create Tobacco Pact 

    Tobacco producers in Zimbabwe and the Philippines have entered into a pact to work together and share expertise. Tobacco is Zimbabwe’s largest agricultural export, generating $1.3 billion from 236 million kg exported in 2024, and is expecting to export 300 million kg this year. Of that, however, 98% of the tobacco is exported raw, allowing manufacturers in 60 other countries to collect much of the profits. The Philippines, on the other hand, processes 46 billion cigarettes domestically each year.

    “This is an ideal opportunity for Zimbabwean farmers and processors,” Musi Muzite, acting executive secretary for Zimbabwe’s National Economic Consultative Forum, said. “We have made significant progress in production, and by leveraging the Philippines’ expertise in processing, we can unlock greater value across the entire tobacco chain.”

    Through the Tobacco Value Chain Transformation Plan, Zimbabwe hopes to convert the tobacco manufacturing sector into a $5 billion industry by 2030 by promoting local value addition, increasing domestic funding, and improving infrastructure, such as curing facilities. It also hopes to increase its tobacco exports in the Philippines.

    “We have been in Zimbabwe and our mission is to explore areas where we can collaborate, particularly in the production of tobacco,” Robert Ambrose, the Philippines’ National Tobacco Administration regulatory manager said. “While we have a comparative advantage in processing, Zimbabwe leads in raw tobacco production, and we see great potential in combining our strengths.” 

  • Ispire Y-Y Drops 13% for 3Q 2025

    Ispire Y-Y Drops 13% for 3Q 2025

    Ispire Technology Inc. today (May 12) reported financial results for the third quarter of fiscal 2025, for the three months ending March 31, 2025. Y-Y revenue dropped to $26.2 million from $30.0 million, and gross profit dropped to $4.8 million from $6.1 million. Y-Y total operating expenses increased to $15.4 million from $11.8 million for the third quarter, creating a net loss of $10.9 million compared to a loss of $5.9 million in 2024.

    “The progress the company made during the third fiscal quarter demonstrates that we are delivering on our promises and executing on our strategic priorities to become a leading global provider of precision dosing vape technology,” said Michael Wang, co-CEO. “We have made significant strides as we are transitioning our manufacturing to Malaysia, effectively de-risking our production strategy for the current geopolitical climate. During the third fiscal quarter, in an effort to further streamline our operations and increase margins, we moved a number of our daily functions to our Malaysian campus which we anticipate will reduce our operating expenses by $8 million annually. 

    “Another milestone also was our reduction in accounts receivable, which happened for the first time in Ispire’s history. We took the necessary steps this quarter to focus on higher-quality customers, including larger MSOs, which helped bolster our overall financial position.”

    “Over recent quarters, Ispire has made a concerted effort to decrease our accounts receivable and improve our financial stability,” Jim McCormick, Ispire CFO, said. “In order to do so, we became laser-focused on pursuing larger and higher-quality customers. The success we had in executing this strategy resulted in the company reducing accounts receivable to $60.4 million vs. $67.7 million for the third fiscal quarter of the prior year. We remain steadfast in our commitment to driving shareholder value as we continue to focus on revenue generation, margin expansion, and further reduction in our accounts receivable.”

    The company conducted a conference call this morning. A playback is available until May 15 at midnight. It can be accessed at 800-770-2030 with the passcode 9733287.

  • JT Announces First Quarter 11.7% YoY Increase

    JT Announces First Quarter 11.7% YoY Increase

    Today (May 7), JT Group reported first-quarter 2025 revenue of ¥827 billion ($5.8 billion), up 11.7% year-on-year, driven by double-digit growth in reduced-risk products (RRP). Adjusted operating profit was ¥273.8 billion ($1.9 billion), a 20.8% increase year-on-year, while net profit attributable to shareholders was ¥157.5 billion ($1.1 billion), a slight increase of 0.1% over last year.

    Management noted that the profit growth was mainly driven by the tobacco business and announced plans to divest its pharmaceutical business, with the transaction expected to close in the second half of the year. Management reiterated its medium- to long-term strategic goal of achieving approximately 15% market share in key heated tobacco markets by the end of 2028.

     “The JT Group achieved strong top-line growth in the first quarter, driven by solid pricing in the tobacco business, resulting in a 20.8% increase in adjusted operating profit at constant FX,” said Masamichi Terabatake, President and CEO of the JT Group. “In HTS [heated tobacco sticks], our strategic investment priority, Ploom steadily grew its share in Japan and overseas markets, leading to a significant 19.0% increase year-on-year in RRP volume. To accelerate our growth in RRP, we plan to launch a new Ploom device and stick ecosystem, starting with Japan. Details on the new products will be provided on May 27 at the launch event. We continue to make steady progress towards our 2028  ambitions for the RRP business of achieving mid-teen HTS segment share in key markets.”

  • Turning Point Announces 1Q YoY Increase of 28.1%

    Turning Point Announces 1Q YoY Increase of 28.1%

    Turning Point Brands, Inc. today (May 7) announced financial results for the first quarter ended March 31, with net sales increasing 28.1% YoY to $106.4 million.

    “We are pleased with our first quarter results,” said Graham Purdy, President and CEO. “Modern Oral sales were $22.3 million, up nearly 10 times versus the prior year and nearly double the prior quarter. MST and looseleaf exceeded our expectations, and Zig-Zag was in line with our expectations.”

    The announcement included a Q1 2025 Adjusted EBITDA of $27.7 million, up 12.0% over the prior year, and a reaffirmation of previously announced 2025 Adjusted EBITDA guidance of $108 million to $113 million; increasing full-year consolidated nicotine pouch sales guidance to a range of $80 million to $95 million, from $60 million to $80 million.

    The company said Stoker’s Products net sales increased 62.7%; Zig-Zag Products net sales increased 1.2%; and gross profit increased 23.3% to $59.6 million.