Category: Featured

  • BAT India to Sell Shares of ITC

    BAT India to Sell Shares of ITC

    Image: Tobacco Reporter archive

    BAT’s wholly owned subsidiary Tobacco Manufacturers (India) intends to sell up to 436,851,457 ordinary shares in ITC to institutional investors. The trade shares represent up to approximately 3.5 percent of ITC’s issued ordinary share capital.

    Following completion of the proposed block trade, BAT’s shareholding in ITC will be approximately 25.5 percent.

    BAT intends to use the net proceeds of the trade to buy back BAT shares over a period ending December 2025, starting with £700 million ($892.9 million) in 2024. BAT will continue to allocate operating cashflow to fund investment in its transformation and to further deleverage.

    Going forward, the key elements of capital allocation at BAT will include continued investment in its transformation; progressive dividends; continued deleverage to a new range of 2 times to 2.5 times adjusted net debt/adjusted EBITDA; and sustainable share buybacks, according to the company.

    “I am confident that ITC, under the stewardship of its current management, will continue to create further value for its shareholders,” said BAT CEO Tadeu Marroco in a statement. “We look forward to remaining important shareholders in ITC as it continues its journey of growth. With this transaction, BAT can accelerate the start of a sustainable buyback while enabling us to continue to deleverage toward a new target range of 2 [times] to 2.5 times adjusted net debt/adjusted EBITDA.”

  • Consumer Group Says No to PMTA Registries

    Consumer Group Says No to PMTA Registries

    U.S. states must recognize the unintended consequences of passing laws requiring premarket tobacco product application (PMTA) registries for alternative nicotine products such as vaping devices, heaters, and nicotine pouches, according to the Consumer Choice Center, an organization claiming to represent consumers in more than 100 countries.

    In the first months of 2024, more than a dozen bills have been introduced in U.S. states calling for a state-based registry for alternative nicotine products. Such legislation has already been passed in Oklahoma, Louisiana and Alabama.

    “While the intention behind these bills is to manage consumer access to unregulated nicotine products on the illicit market, the reality is that the FDA is not approving enough new devices and products to create a competitive, regulated marketplace that meets consumer demand,” said Elizabeth Hicks, U.S. affairs analyst at the Consumer Choice Center.

    While 26 million nicotine alternative products submitted PMTAs to the Food and Drug Administration, only 23 have been approved. Of those 23 approved products, 12 are tobacco-flavored e-liquid refills.

    “The FDA is hiding the ball here on product approvals and how few new products are actually coming to market. If the goal is to improve public health across the country, then consumers deserve to choose from a variety of different nicotine alternatives,” said Hicks.

    The Consumer Choice Centers urges state legislatures to refrain from adding to counterproductive federal policies and instead advance tobacco harm reduction through a competitive marketplace.

  • Okman Joins Filtrona as Commercial Director

    Okman Joins Filtrona as Commercial Director

    Lutfu Okman (Photo courtesy of Filtrona)

    Filtrona has appointed Lutfu Okman as its new global commercial director.

    Okman brings with him over 25 years of commercial leadership experience, including senior management roles with multinational companies in the textiles, chemical and manufacturing industries.

    He succeeds Hywel Thomas, who has announced his retirement after 10 years with the company.

    “We are really pleased to welcome Lutfu to the Filtrona family,” said Filtrona CEO Robert Pye in a statement. “His proven track record of strategic commercial growth and wealth of experience make him an ideal fit for the role, and he is primed to drive our ambitious growth strategy. Lutfu plays a pivotal role in shaping Filtrona’s commercial endeavors and fostering sustainable long-term growth.”

    “I am thrilled to join Filtrona at such an exciting time in its journey, particularly during the 100-year anniversary of the company’s first patented filter,” said Okman. “I look forward to collaborating with the talented and passionate Filtrona team to drive our commercial strategy, deliver exceptional value to our customers, and contribute to the company’s continued growth.”

    Pye also expressed his gratitude for Thomas’ dedication and contributions to Filtrona. “Hywel’s leadership, strategic vision, and sharp business acumen have been invaluable to Filtrona, helping to make us the successful and dynamic global business that we are today. We sincerely thank Hywel and wish him the very best in his well-earned retirement.”

  • Turning Point Appoints Andrew Flynn CFO

    Turning Point Appoints Andrew Flynn CFO

    Image: motortion

    Turning Point Brands (TPB) has appointed Andrew Flynn as the company’s new chief financial officer (CFO), effective on or before April 1, 2024. Flynn is replacing Louie Reformina, who will step down to pursue other opportunities.

    Prior to joining Turning Point Brands, Flynn served as the CFO of Connected Cannabis Co., where he was responsible for bringing sustained profitable growth, expanding geographically and recapitalizing the company. In this role, Flynn operationalized and reshaped the finance, IT, legal and compliance organizations to meet business objectives. Before joining Connected, he served as senior vice president of Juul Labs. Earlier in his career, he served as vice president of finance at James Hardie Building Products and vice president of finance at Arrow Electronics. Flynn holds a Bachelor of Science degree from Indiana University and a Master of Business Administration degree from the University of Colorado Denver.

    “Turning Point Brands is one of the most innovative and well-capitalized companies in the industry. TPB’s iconic Zig-Zag and Stoker’s brands and market-leading distribution platform set it apart in this rapidly evolving space. As CFO, I look forward to working with the board and management team to maximize long-term shareholder value,” said Flynn.

    “Andrew has led key initiatives across all areas of finance and broader strategic planning throughout his career. His diverse operating background and industry expertise ideally positions him to help us maximize the value of our brands, continue to modernize our organization, and grow our free cash flow,” said Graham Purdy, Turning Point Brands’ president and CEO.

  • Habanos Announces Deal With Liquor Maker

    Habanos Announces Deal With Liquor Maker

    Credit: Creuxnoir

    Chinese liquor company Luzhou Laojiao and Cuban cigar company Habanos SA have signed a strategic agreement to jointly expand their markets.

    During the 24th Habano Festival in Havana, Cuba, Zhang Biao, general manager of Luzhou Laojiao, highlighted the similarities between Luzhou Laojiao’s liquor and Cuban cigars, noting that the cooperation will strengthen the commercial ties between China and Cuba.

    The agreement includes a joint product through co-branding, with the Chinese company handling the marketing. José María López, vice president of development at Habanos, said that this partnership is based on shared values ​​such as craftsmanship, quality and leadership, highlighting the “perfect match” between Chinese liquors and Cuban cigars.

    Habanos executives reported that China is one of the most dynamic markets for Cuban cigar sales. The country contributed heavily to a 31 percent increase in Cuban cigar sales in 2023, reaching a total of $721 million.

    The signing of the Memorandum of Understanding aims to explore new avenues of cooperation for both companies. Luzhou Laojiao, one of China’s oldest liquors, has been produced in the National Treasure Cellars since 1573, with distillation technology dating back 700 years.

    The collaboration will focus specifically on Luzhou Laojiao’s “Guojiao 1573” brand and Habanos Corporation’s Cohiba Atmosphere brand. In addition, seven Guojiao 1573 brand liqueurs were auctioned along with during the festival’s humidor auction, with the funds raised going to public health initiatives in Cuba.

    “This strategic agreement strengthens commercial ties between China and Cuba in the liquor and cigar industries,” according to a press release.

  • TIMB Licenses 32 Contractors

    TIMB Licenses 32 Contractors

    Photo: Taco Tuinstra

    Zimbabwe’s Tobacco Industry and Marketing Board (TIMB) has licensed 32 contractors to buy leaf this season, reports The Herald.

    The country’s tobacco auctions will open March 13, with the contract floors starting operations a day later.

    To date, the regulator has licensed only two auction floors—the Tobacco Sales Floors and Premier Tobacco Auction Floor.

    Contract sales will be conducted in Harare and at decentralized selling centers in Karoi, Mvurwi, Bindura, Marondera and Rusape.

    TIMB Head of Operations Blessing Dhokotera reiterated that tobacco farmers would retain 75 percent of their proceeds in U.S. dollars and the remainder in local currency.  

    He also highlighted measures against child labor, side marketing and the spread of infectious diseases such as Covid-19 and cholera.

    Zimbabwe’s tobacco production has suffered from drought this years, with officials predicting a harvest of 265 million kg this year, compared with 294 million kg in 2023, according to News Day.

    The droughts are attributed to the El Nino climate phenomenon which involves a periodic warming of ocean temperatures in the central and eastern Pacific Ocean, near the equator, and can have significant impacts on weather patterns worldwide.

  • BAT Inaugurates Innovation Center

    BAT Inaugurates Innovation Center

    Photo: BAT

    Included in British American Tobacco’s new innovation center at Southampton, U.K., is a nicotine-pouch pilot plant that allows its researchers to go from concept to trial product in an hour. The investment in the pilot plant is presumably an indication of the confidence the company has in nicotine pouches, which sit comfortably alongside nicotine replacement therapy products on the continuum of risk and that are perhaps the most environment friendly of all the lower-risk products being used to assist smokers move away from cigarettes.

    Officially opened on March 7 in the presence of BAT’s entire management board, the new center is housed within BAT’s research and development facility, which has been in operation since 1956 on a site occupied by the company for more than 100 years.

    In a press note, BAT said the £30 million ($38.56 million) investment would support its mission to become a predominantly smokeless business in which 50 percent of its revenue was derived from non-combustibles by 2035.

    The center provides nine specially designed technical spaces to aid the development of BAT’s portfolio of new category products. “These spaces are dedicated to research for modern oral nicotine pouches, for liquids and flavor for vapor products, for heated tobacco products, and for well-being and stimulation beyond nicotine,” the press note said. “The investment will also support work on packaging, engineering, innovation development and system integration…

    “The new facilities will bring together cross-functional and key R&D teams—with 400 highly specialized scientists and engineers, drawn from a range of fields including biotechnology and clinical trials. These teams will accelerate the development of the next generation of BAT’s new category products and provide the robust evidence necessary to encourage adult smokers to switch to less risky alternatives, backed by science.’

    James Murphy, director, research and science at BAT, said, “The opening of this new facility marks an important milestone in BAT’s transformation and will play a key role in making a smokeless future a reality.”

    Meanwhile, BAT said it had more than 1,600 specialists spread across the U.K., the U.S., Brazil, Indonesia, Malaysia and China. “The £30 million investment in the Southampton facility follows the opening of BAT’s innovation centers in Trieste, Italy, in 2021 and in Shenzhen, China, in 2022, and an investment of £300 million a year in R&D to develop new category products and establish substantiation of their reduced risk potential,” the company said.

  • Massachusetts Court OKs Generational Ban

    Massachusetts Court OKs Generational Ban

    Brookline, Massachusetts (Credit: Wangkun Jia)

    The highest court in Massachusetts ignored objections from vape shop owners and tobacco retailers and upheld the legality of a novel bylaw that bars cigarette sales to anyone born after January 1, 2000, in the town of Brookline. The restriction, the first of its kind in the United States, is designed to prevent future generations from using not only tobacco but also nicotine.

    Retailers argued that the 2021 Brookline bylaw was pre-empted by a state law approved in 2018 that raised the minimum age for purchasing a tobacco product from 18 to 21, according to media reports. The retailers pointed out that the Brookline bylaw effectively means someone born after January 1, 2000, will not be able to purchase a nicotine product regardless of their age.

    Over time, as the population ages, the bylaw will effectively ban the sale of tobacco products in the town.

    In the Supreme Judicial Court’s unanimous opinion, written by Justice Dalila Wendlandt, the court acknowledged the Brookline bylaw is more restrictive than the state’s minimum age standard, but the justices had no issues with that. They said the bylaw “augments the state statute” by further limiting access to tobacco products to persons under the age of 21.

    The court rejected claims by the tobacco retailers that the state law was designed to clarify what had become a muddled regulatory environment as municipality after municipality raised the minimum age for buying tobacco products.

    “The retailers claim that the purpose of the Tobacco Act was ‘actually to benefit tobacco retailers . . . by eliminating the confusion that arises when the minimum age for purchasing tobacco varies from town to town and city to city across the Commonwealth,’” the opinion said. “To the contrary, the act reflects the legislative intent to protect young persons and other vulnerable populations from the deleterious health effects of tobacco product use.”

    The case drew attention in Massachusetts and around the nation and the world and the outcome is likely to prompt more communities to follow Brookline’s lead, creating a patchwork quilt of regulation of tobacco products.

  • Colorado Flavor Ban Bill Dies

    Colorado Flavor Ban Bill Dies

    Tobacco Reporter Archives

    It happened again. For the second time in the last three sessions, a bill to regulate flavored nicotine products has died in Colorado’s General Assembly.

    The proposal would have allowed a board of county commissioners to ban flavored tobacco and nicotine products. The House Business Affairs & Labor Committee defeated it on a 6-5 vote, according to Colorado Public Radio.

    Several lawmakers on the committee voting against the bill cited concerns about its impacts on local businesses, echoing testimony from several vape shop owners who said it would have hurt sales if a county banned flavored vaping and other tobacco products.

    “We have a long history of choosing to listen to the tobacco lobby,” said bill sponsor Rep. Elizabeth Velasco, as she appealed to her colleagues before the vote. “I hope that today we can really think about the children and make sure that we do the right thing to make sure that our children don’t have access to these products that have been targeted for them.”

    The measure had already passed a Senate committee and the full Senate. As has been seen in prior years, the bill drew intense lobbying, with 141 lobbyists from both sides signing up to voice support, opposition, or neutrality, according to the state’s lobbyist disclosure website.

    Tobacco companies like PMI, RJ Reynolds America, and Altria, represented by the lobbying company Brownstein Hyatt Farber Schreck, and industry groups, including the Vapor Technology Association, hired lobbyists in opposition to the legislation.

    All the traditional anti-nicotine groups such as Bloomberg, Tobacco-Free Kids Action Fund and Kaiser Permanente also hired lobbyists in support.

    In 2022, a bill to ban flavored tobacco statewide failed after Gov. Jared Polis said the issue should be handled at the local level.

  • Analysts: UK Vape Tax Good for Tobacco Stock

    Analysts: UK Vape Tax Good for Tobacco Stock

    Image: James Thew

    Citi analysts have identified the U.K. government’s new excise tax on vaping products as an encouraging development for BAT and Imperial Brands, reports Proactive.

    Chancellor Jeremy Hunt confirmed in his Spring Budget speech that vaping products would be subject to a new tax from October 2026. According to media reports, this move is designed to maintain a financial incentive for choosing vaping over smoking, complemented by a concurrent increase in tobacco duty.

    The taxation framework will be based on nicotine content, with a three-tiered system imposing charges ranging from £1 ($1.28) per 10 mL to £3 per 10 mL in addition to the current 20 percent VAT.

    This structured approach aims to regulate the vaping market further and aligns with the government’s health strategy by providing a less harmful alternative to traditional smoking.

    Citi’s short research note said: “Although [Wednesday’s] confirmation of the planned levy on vaping comes as little surprise, we believe that alongside the proposed ban on disposable vapes from April 25, the regulatory risk/reward is skewing to the upside for both BAT and Imperial.”