Top News - Tobacco Reporter

Altria Lauded for Sustainable Supply Chain Management

Altria Group has been recognized as a member of CDP’s 2021 Supplier Engagement Leaderboard for climate change, highlighting Altria’s and its subsidiaries’ work in sustainable supply chain management. Its supplier engagement rating (SER) positions it in the top 8 percent of companies who disclosed to CDP’s full climate questionnaire.

The SER provides a rating for how effectively companies are engaging their suppliers on climate change. CDP assesses performance on supplier engagement using a company’s response to selected questions on governance, targets, scope 3 emissions, and value chain engagement in the CDP climate change questionnaire.

“We believe Altria’s and our subsidiaries’ strong, sustainable partnerships with our supplier base and trade partners are critical to our future success and the achievement of Altria’s Vision,” said Sal Mancuso, executive vice president, chief financial officer, in a statement. “We are committed to driving sustainability and diversity through the value chain and we welcome the opportunity to engage further with our suppliers on environmental sustainability as a CDP supply chain member.”

Last year, Altria was recognized for a second consecutive year with a double ‘A’ rating for tackling climate change and protecting water security by CDP, a non-profit that runs a global disclosure system on managing environmental impact. CDP’s A List distinguishes companies for leadership on transparency and action on key environmental issues.

February 11, 2022

Pyxus Reports Third Quarter and Nine-Month Results

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

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

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

Imperial Recognized for Climate Action

Imperial Brands has won continued recognition as a global leader for its engagement with suppliers on strategies to combat climate change.

The business has been included on the 2021 Supplier Engagement Leaderboard compiled by environmental nonprofit organization CDP.

This is the third successive year that Imperial has been named a Supplier Engagement Leader.

In December, Imperial maintained its position on CDP’s Climate ‘A List’ for its actions to cut emissions and mitigate climate risks.

Companies responding to the full version of the CDP climate change questionnaire also receive a Supplier Engagement Rating (SER). The companies with the best SER are highlighted as Supplier Engagement Leaders—which this year are the top 8 percent of companies to have made disclosures.

“We are pleased to once again be recognized by CDP, and we remain unrelenting in our focus on climate, in line with our commitment to reach net-zero global emissions by 2040,” said Imperial’s Global ESG Director Tony Dunnage in a statement.

February 10, 2022

Pyxus Appoints Corporate Treasurer

Pyxus International appointed Tomas Grigera as its vice president and corporate treasurer.

Grigera joins Pyxus with more than 20 years of financial experience, spending the past 14 years employed by The Goodyear Tire and Rubber Co. During that time, Grigera oversaw various financial and treasury responsibilities on a global scale, including working capital management, forex strategy and trading, complex debt restructurings and liquidity planning. Grigera began his career in financial consulting and holds a Master of International Affairs degree from Columbia University.

“I am pleased to welcome someone of Tomas’ caliber to the company,” said Pyxus Chief Financial Officer Flavia Landsberg in a statement. “His extensive background cultivating and successfully executing financial strategies and strong stakeholder relationships throughout global markets are only a few examples of the value Tomas brings to Pyxus and our finance team.”

Grigera reports to Landsberg and is responsible for directing and managing the company’s corporate treasury functions, investor relations, financial planning and management reporting, and related activities.

February 10, 2022

Pyxus Exits Canadian Cannabis Operations

Pyxus International has completed the sale of assets of FIGR Norfolk, the final key step in the company’s strategic decision to exit its cash flow negative cannabinoid operations.

With the completion of this sale, which occurred on Jan. 28, 2022, no subsidiaries of the company produce or sell Canadian cannabis in any capacity. In addition, the company is no longer involved in activities related to industrial hemp or CBD.

“Since announcing our intention to focus on tobacco and e-liquids last year, we have made tremendous strides in streamlining our operations and reducing our SG&A costs,” said Pieter Sikkel, president and CEO of Pyxus International, in a statement. “Moving forward, we will continue to focus on our tobacco-related businesses while leveraging the company’s strengths in agronomy, traceability and sustainability in order to deliver value to our stakeholders.”

February 10, 2022

Study Claims Patches Better Than Vapes

A new study claims that those using e-cigarettes to quit smoking found them to be less helpful than more traditional smoking cessations aids such as patches and gum.

The study, published Monday in the journal BMJ, analyzed the latest 2017 to 2019 data from the Population Assessment of Tobacco and Health (PATH) Study, which follows tobacco use among Americans over time.

“This is the first time we found e-cigarettes to be less popular than FDA-approved pharmaceutical aids, such as medications or the use of patches, gum, or lozenges,” said John Pierce, the director for population sciences at the Moores Cancer Center at the University of California, San Diego, according to CNN.

A three-month randomized trial in the United Kingdom, published in 2019, found e-cigarettes, along with behavioral interventions, did help smokers quit tobacco cigarettes. In guidance published in late 2021, the UK National Institute for Health and Care Excellence decided to recommend that smokers use e-cigarettes to help them quit.

Another recent study, published in JAMA Network Open, found adult smokers with no plans to quit are more likely to stop smoking if they switch to daily vaping, according to new research led by Roswell Park Comprehensive Cancer Center.

The Roswell Park study also used data collected from 2014 to 2019 as part of the PATH study.

February 9, 2022

Dinyar S. Devitre to Retire From Altria Board

Dinyar S. Devitre will retire from Altria Group’s board of directors following the completion of his current term. Consequently, Devitre will not stand for re-election to the board of directors at Altria’s 2022 annual meeting of shareholders, which is presently anticipated to be held on May 19, 2022.

“Altria has benefited from Dinny’s significant contributions for nearly 50 years, including the time he served as Altria’s senior vice president and chief financial officer and his 14 years on the board,” said Kathryn McQuade, Altria’s independent board chair, in a statement. “We thank him for his remarkable service to this company.”

“I’ve had the privilege and benefit of working closely with Dinny over my time in leadership,” said Billy Gifford, Altria’s CEO. “We will miss his insights and perspective built from so many years of distinguished service and wish him all the very best.”

A director on Altria’ s board since 2008, Devitre is the chair of the finance committee and a member of the compensation and talent development, nominating, corporate governance and social responsibility, and executive committees.

He is a director of IHS Markit, Avestar Capital, Pratham USA and the Brooklyn Academy of Music.

February 9, 2022

Btomorrow Ventures Invests in Philter Labs

Btomorrow Ventures (BTV) will make a follow-on investment into Philter Labs, after leading the round for the Preferred Series A.

Philter Labs supplies micro-filtration systems for the cannabis and nicotine markets with its patented Particulate Capture Technologies (PCT) for standalone handheld filters and next-generation vaping devices that removes particulates, airborne contaminants and odor from secondhand smoke and exhalant.

“We are delighted to have Btomorrow Ventures continued confidence and financial support,” said Christos Nicolaidis, CEO of Philter Labs, in a statement. “We will use the funds to support new product launches in the first quarter of 2022 along with furthering our development of exciting new products that incorporate our patented filtration technology to be launched later this year.”

Philter Labs says it has a robust new product pipeline, with several products planned to launch this year and next. All of these products are designed for ease of consumer use in eliminating secondhand smoke, with a focus on collective social responsibility for more conscious consumption.

BTV is the corporate ventures unit of BAT. Established early in 2020, BTV invests in high growth businesses, from seed funding to those looking for further, series B investment.

Tobacco Reporter profiled Philter Labs in its September 2020 issue.

February 8, 2022

Category: Top News