Category: Financial

Record Year for Swedish Match

Photo: Swedish Match
Swedish Match reported record sales and operating profit in 2021, with double-digit growth in both revenues and earnings in local currencies across all product segments.
Full-year growth was driven by strong performance in the Smokefree product segment with considerable growth in both the U.S. and Scandinavia. Growing demand for natural leaf cigars drove the robust full year local currency financial performance for the Cigars product segment. The lights product segment too displayed strong underlying performance.
Fourth-quarter performance was driven by the company’s Smokefree segment, with continued strength in the U.S. and Scandinavia. Sales and earning for the Cigars segment declined during the fourth quarter, due in part to production restraints.
In local currencies, sales increased by 16 percent for the full year and by 12 percent for the fourth quarter. Reported sales increased by 11 percent to SEK18.49 billion ($2 billion) for the full year and by 15 percent to SEK4.75 billion for the fourth quarter.
In local currencies, operating profit from product segments increased by 19 percent for the full year and by 11 percent for the fourth quarter. Reported operating profit from product segments increased by 14 percent to SEK8.14 billion for the full year and by 15 percent to SEK1.96 billion for the fourth quarter.
“Our sales performance in 2021 was outstanding, hitting a new all-time high,” said Lars Dahlgren, CEO of Swedish Match, in statement. Dahlgren was particularly pleased with the performance and potential of the company’s nicotine pouches, which grew by more than 50 percent in the U.S. and Scandinavia in 2021.
“The total addressable market for nicotine pouches includes cigarette smokers, but also draws from other oral tobacco products, as well as from the growing pool of consumers who currently use vape
products but have found our nicotine pouches to have greater appeal,” said Dahlgren.
February 16, 2022
Bosnia’s FDS Factory to Close Next Month

Photo: Richard Darko
Badeco Adria will close its Fabrika Duhana Sarajevo (FDS) tobacco factory due to financial losses, FDS said on Feb 14.
In the past three years, losses have reached KM7.5 million ($4.3 million), FDS told SeeNews.
The decision will be put to the vote at a Badeco Adria shareholders meeting in early March, after which the 200 employees at the factory will be laid off and will receive severance pay.
Badeco Adria is the legal successor to FDS, which was established in 1880 as a tobacco company. After a restructuring process, the company changed its name to Badeco Adria in 2018. Badeco Adria is majority owned by Austria’s CID Adriatic Investments, which holds an 89.2 percent stake, according to the Sarajevo Stock Exchange.
FDS plans to halt its operations on March 31, according to Faktor news agency.
February 14, 2022
JT Reports Robust 2021 Driven by Tobacco

Photo: JTI
The JT Group’s revenue increased 11.1 percent to ¥2.32 trillion ($20.15 billion) in 2021. Adjusted operating profit a constant exchange rates was up 22.9 percent to ¥598.4 billion. On a reported basis, operating profit increased 25.4 percent to ¥610.4 billion. The company reported an operating profit of ¥449 billion, up 6.4 percent over that reported in the previous year.
“The JT Group reported a robust performance in 2021, driven by strong momentum across the tobacco business,” said JTI President and CEO Masamichi Terabatake in a statement. “Our consumer-centric approach and strong brand portfolio have enabled share gains in the majority of our markets and resulted in a record sales volume in the international tobacco business.
“Despite a challenging operating environment, including the ongoing pandemic, the group accomplished several important milestones in the year. We implemented measures to generate sustainable growth, notably in our priority investment category where we launched our new HTS [heated tobacco sticks] device, Ploom X, starting in Japan. We also successfully implemented various initiatives related to the new operating model for the consolidated tobacco business, which went live this January.”
Going forward, JTI’s priority will be to expand its presence in the reduced-risk product (RRP) category, with an emphasis on HTS products. The company aims to break even in the RRP category by 2027 by achieving a heated tobacco segment share in the mid-teens across its key HTS markets.
“To reach this goal, we are accelerating necessary business investments and expect an annual average growth rate of adjusted operating profit at constant currency to be mid-single digit during the 2022 business plan period,” said Terabatake. “Furthermore, we plan to grow profit, which in turn will increase shareholder returns, in line with our shareholder return policy.”
February 14, 2022
KT&G’s Income Down on Weaker Exports

Photo: KT&G
KT&G’s net income declined 15.5 percent to KRW990 billion ($825,52 million) on weaker exports and other adverse developments, according to the company’s annual earnings release. Operating profit declined to KRW1.32 trillion from KRW1.47 trillion.
Sales grew 3.4 percent to an all-time high of KRW5.23 trillion driven by growth of the company’s heat-not-burn and overseas cigarette businesses, which offset decreases in KT&G’s real estate and cigarette export units.
In the fourth quarter of last year, KT&G’s bottom line plunged 63.7 percent on-year to KRW111.5 billion. Sales declined 2.3 percent to KRW1.2 trillion, with operating income tumbling 24.5 percent to KRW264.9 billion.
The company said it sold 38.8 billion cigarettes in overseas markets last year, down 7.4 percent from the prior year, with domestic sales edging down 1.3 percent to 41.1 billion cigarettes.
Despite the global spread of Covid-19, KT&G said it made forays into 20 new countries last year, with its overseas markets totaling 120 nations.
The company voiced optimism that its exports will gradually rebound down the road once global supply chain bottlenecks ease.
February 11, 2022
Pyxus Reports Third Quarter and Nine-Month Results

Photo: Freedomz
Pyxus International reported sales and other operating revenues of $428.9 million for the three months ended Dec. 31, 2021, up 13 percent over those reported in the 2020 third quarter. Gross profit increased 4.3 percent to $65.2 million. As a share of sales, however, gross profit decreased to 15.2 percent.
For the nine months ended Dec. 31, 2021, sales and other operating revenues increased 22.4 percent to $1.16 billion. Gross profit increased 35.2 percent to $159.4 million. As a percent of sales, gross profit increased to 13.8 percent for the nine months.
“We are pleased that our leaf operations’ volume, revenue, and gross margin continued to improve on a year-to-date basis,” said Pyxus President and CEO Pieter Sikkel in a statement. “As of Dec. 31, 2021, more than 90 percent of the company’s inventory was committed to specific customers to meet near-term forecasted demand. In addition, our uncommitted inventory decreased compared to the prior year, is near the low end of our target range of between $50 million and $150 million, and is expected to remain near the low end of our targeted range through fiscal year-end.”
Sikkel said Pyxus would remain proactive in its efforts to accelerate shipments delayed by Covid-related logistical challenges. However, the company expects these challenges to linger for the remainder of its fiscal year, which will delay shipments of committed inventory from the fourth quarter of fiscal 2022 into the first half of fiscal 2023.
The company said it would maintain its focus on liquidity. To address upcoming maturities in its capital structure, Pyxus recently entered into a new $100 million ABL credit facility.
Meanwhile, continued delays of enforcement activities in the e-liquids industry have resulted in lower than anticipated revenue and adjusted EBITDA through the third quarter, according to Sikkel. In November 2021, Pyxus disposed of interests in Humble Juice Co. in exchange for royalties on future revenues.
In December 2021, Pyxus unveiled its environmental, social, and governance framework, demonstrating the company’s commitment to operating its business in a responsible manner.
Earlier this week, the company completed the sale of its FIGR Norfolk assets, the final the final key step in the company’s strategic decision to exit its cash flow negative cannabinoid operations.
February 11, 2022
BAT Announces Preliminary Results

Photo: BAT
British American Tobacco reported revenue of £25.68 billion ($34.87 billion) in 2021, down 0.4 percent from 2020. Revenue from “New Categories” jumped 42.4 percent to £2.05 billion. On an adjusted basis, revenues increased 6.9 percent while revenues from new categories were up by 50.9 percent. Profit from operations was up 2.7 percent to £10.23 billion or £11.15 billion (up 5.2 percent) on an adjusted basis.
BAT CEO Jack Bowles described 2021 as a “pivotal year.” “We accelerated New Category revenue, with growth of over 50 percent and reached a total of 18.3 million consumers–up 4.8 million—of our non-combustible products,” he said in a statement.
“Putting ESG at the heart of our strategy and corporate purpose is delivering sustainable growth, encouraging more consumers to transition to reduced risk products and reducing the health impact of our business. We are also on track to achieve our other ESG targets, including carbon neutrality from our operations by 2030.”
The company is on track to deliver £5 billion of revenue from New Categories by 2025, said Bowles, adding that BAT is also developing opportunities beyond nicotine.
Alongside its 2021 preliminary results, BAT also announced a program to buy back up to £2 billion of ordinary shares. The company said it may purchase up to 229,400,000 shares between Feb. 14 and Dec. 21, 2022.
February 11, 2022
PMI Reports Strong Fiscal 2021

Photo: PMI
Philip Morris International reported net revenues of $31.41 billion in 2021, up 9.4 percent over those reported in 2020. The company’s operating income was $12.98 billion, compared with $11.67 billion in the previous year. The company’s net revenues were $246 million lower than they could have been due to a 2021 customs assessment in Saudi Arabia.
For the fourth quarter of 2021, PMI reported net revenues of $8.1 billion, up 8.9 percent over those reported in the corresponding 2020 quarter. The company’s operating income was $2.95 billion in the fourth quarter, compared with $2.91 billion in the comparable period of the previous year.
PMI shipped 624.88 billion cigarettes in 2021, down 0.6 percent from 2020. The volume of heated tobacco units was up 24.8 percent to 94.98 billion. In the fourth quarter of 2021, the company shipped 158.38 billion cigarettes and 25.4 billion heated tobacco units, up 2.4 percent and 17 percent, respectively, from the 2020 fourth quarter.
“Our business delivered excellent performance in 2021, with strong underlying momentum driving total volume growth, high single-digit organic net revenue growth and double-digit adjusted diluted EPS growth against the pandemic-affected prior year,” said PMI CEO Jacek Olczak in a statement.
“We were especially pleased by the reacceleration of our business in the fourth quarter to deliver better-than-expected results. This included a step-up in sequential IQOS user growth, as well as the outstanding initial performance of IQOS ILUMA. We also achieved essentially stable category share for cigarettes in the quarter, as our portfolio initiatives bore fruit and pandemic-linked restrictions receded in many markets.”
“We enter 2022 with strong fundamentals, underpinned by IQOS, and exciting innovation to come across our broader smoke-free product portfolio. We are forecasting organic top-line growth of 4 percent to 6 percent and currency-neutral adjusted diluted EPS growth of 8 percent to 11 percent, which prudently incorporate the continuing uncertainty on full IQOS device availability and the pace of the ongoing pandemic recovery.”
February 10, 2022
ITC Quarterly Revenue up 30 Percent

Photo: Wirestock
ITC reported an operating revenue of INR183.66 billion ($2.46 billion) in the October-December period, up 30 percent over the corresponding quarter in 2020, according to Business Today.
Growth was boosted by the company’s agricultural and cigarette businesses. ITC’s cigarettes segment posted remarkable growth following a long period of decline. At INR69.59 billion, revenue from cigarettes was 14.3 percent higher year-on-year and grew 12 percent sequentially. According to Edelweiss securities, it was way above its estimated growth rate of 8 percent.
ITC’s agri-business revenue jumped 90 percent in the third quarter of fiscal 2022 from the year-ago period, while it grew by 82.7 percent sequentially. Strong exports offset weak domestic demand for the company’s agricultural products, which include leaf tobacco, during the quarter.
“Robust recovery continued across markets aided by increase in mobility and agile supply chain and market servicing,” ITC wrote in a statement. Market standing reinforced leveraging portfolio vitality, product accessibility and execution excellence. Business continues to invest in augmenting assortment to strengthen its competitive position and counter illicit trade.”
February 7, 2022
Universal Corp. Reports ‘Solid’ Results

George Freeman III (Photo: Universal Corp.)
Universal Corp. reported net income of $60.8 million for the nine months ended Dec. 31, 2021, compared with $48 million for the nine months ended Dec. 31, 2020.
Excluding restructuring and impairment costs and certain other non-recurring items, net income increased by $4.5 million. Operating income increased by $18.1 million to $103.2 million. Adjusted operating income was $116.5 million, compared to adjusted operating income of $107.6 million for the comparable period in 2020.
Net income for the quarter ended Dec. 31, 2021, was $34.9 million, compared with $33.3 million for the quarter ended Dec. 31, 2020.
Excluding restructuring and impairment costs and certain other non-recurring items, net income decreased by $9.7 million. Operating income increased by $2.6 million to $62.8 million. Adjusted operating income was $74.9 million, compared to adjusted operating income of $85.2 million for comparable 2020 quarter.
“Our operations produced solid results in the nine months ended Dec. 31, 2021,” said Universal Corp. President and CEO George C. Freeman III in a statement. “We are especially pleased by the strong results from our Ingredients Operations segment. That segment is developing nicely and was bolstered by our acquisition of Shank’s Extracts Inc. on Oct. 4, 2021. Shank’s adds valuable capabilities to the segment, including flavors and extracts, custom packaging, bottling, and product development.
“We continued to experience the impact of tobacco shipment timing on our results in the nine months and quarter ended Dec. 31, 2021.
“Tobacco shipments through the nine months ended Dec. 31, 2021, were lower, compared to the same period in fiscal year 2021, in part due to elevated tobacco shipments in the third quarter of fiscal year 2021 related to earlier customer mandated shipment timing.
“Logistical challenges due to continued limitations in worldwide shipping availability stemming from the ongoing Covid-19 pandemic also slowed tobacco shipments in the nine months ended Dec. 31, 2021. However, despite the shipment timing variations and logistical challenges, we believe that our tobacco business remains robust with strong customer demand, and our uncommitted tobacco inventory levels remain well within our target range.”
February 3, 2022
Altria Group Reports Full-Year Results

Photo: Casimiro
Altria Group earned net revenues of $26.01 billion in 2021, down 0.5 percent from its 2020 net revenues. Net revenues net of excise taxes was up 1.3 percent to $21.11 billion in 2021. For the fourth quarter of 2021, Altria Group reported net revenues of $6.26 billion, down 0.8 percent over those reported in the comparable 2020 period. Revenues net of excise taxes were up 0.6 percent to $5.09 billion for the fourth quarter.
“Altria delivered outstanding results in 2021 across our businesses, including strong financial performance, progress toward our vision and advancements in our ESG efforts,” said Altria CEO Billy Gifford in a statement.
“We returned more than $8.1 billion in cash to shareholders in 2021 through dividends and share repurchases. This total represents the third-largest single-year cash return in Altria’s history and the largest annual return since 2002.
“Our plans for the year ahead include a continuation of our strategy to balance earnings growth and shareholder returns with investments toward our vision. We expect to deliver 2022 full-year adjusted diluted EPS in a range of $4.79 to $4.93, representing a growth rate of 4 percent to 7 percent from an adjusted diluted EPS base of $4.61 in 2021.”
Altria’s heated-tobacco business suffered a setback when the U.S. International Trade Commission imposed an importation ban on the IQOS device, Marlboro HeatSticks and infringing components following an intellectual property dispute with Reynolds American Inc. As a result, the IQOS system is no longer available for sale in the U.S.
Atria says it remains focused on returning IQOS to the U.S. market.
January 27, 2022