Tag: Featured

Stories featured at the top of tobaccoreporter.com

Strong Quarter Paves Way for KT&G Ambitions

Photo: KT&G
KT&G posted KRW1.46 trillion ($1.31 billion) in consolidated sales for the third quarter of this year, up 10.7 percent from last year, reports The Korea Times. During the same period, operating profit grew 13.6 percent to KRW434.6 billion.
The South Korean cigarette manufacturer’s performance was boosted by overseas sales, which grew 28.2 percent year-on-year to KRW262.9 billion. KT&G said it sold 12.7 billion cigarettes abroad from July to September, up 30.9 percent from a year earlier. The increase was largely due to growth in the Middle East and the expansion of the sales networks of its U.S. and Russian subsidiaries.
Baek Bok-in
Following the latest results, KT&G appears to be well on its way of realizing CEO Baek Bok-in’s goal of becoming the No. 4 player in the global cigarette market by 2025. In 2018, KT&G was No. 5 in terms of sales volume, according Euromonitor International.
The company exported products to approximately 50 countries in the third quarter of 2017, but this grew to 90 in the third quarter of this year. Revenue from exports grew by KRW28.2 billion, outpacing the KRW22.2 billion growth in domestic sales during the same period.
The company said it will increase the number of export markets to 100 by the end of this year and double the number by 2025.
KT&G attributes its success to increased investments for product improvements.
Tobacco heating products, too, have contributed to the company’s performance. Earlier this year, KT&G signed an agreement with Philip Morris International so that the latter would distribute KT&G’s tobacco heating products in overseas markets. Following the agreement, KT&G’s Lil tobacco heating devices and their exclusive cigarette products began exports to Russia in August, Ukraine in September and Japan in October.
In October, Morgan Stanley Capital International assigned KT&G a top grade in an environment, social and governance evaluation. KT&G ranked first among 11 tobacco companies for product safety and quality due to its responsible marketing and outstanding quality management. It also earned a high score for supply chain labor standards.
Tobacco Reporter featured KT&G’s global ambitions in its July 2020 print edition.
November 13, 2020
Turning Point Declares Stock Dividend

Photo: Alexsander-777 from Pixabay
Turning Point Brands (TPB) has declared a regular quarterly dividend of $0.05 per common share. The dividend is payable on Jan. 8, 2021, to shareholders of record on the close of business on Dec. 18, 2020, the company announced in a statement.
TPB manufactures, markets and distributes branded consumer products with active ingredients through its Zig-Zag and Stoker’s core brands and its emerging brands within the NewGen segment.
The company’s products are available in more than 210,000 retail outlets in North America and on various websites.
November 13, 2020
JT recognized as LGBT-Friendly

Photo: JT
Japan Tobacco (JT) has received the highest ranking in the PRIDE Index 2020 for the fifth consecutive year. Created by Work with Pride, the index evaluates companies’ initiatives related to LGBT and other sexual minorities in Japan.
“We are delighted to receive the Gold recognition for the fifth consecutive year,” said Koichi Mori, JT’s senior vice president of human resources, in a statement. “At JT, we position respecting diversity as one of key management challenges.”
JT believes that embracing diversity and finding value in differences will bring about sustainable growth. The company has taken a variety of initiatives to create, develop and enhance the work environment by fostering diversity, where everyone can freely express their own personalities and recognize one another’s differences.
November 13, 2020
Altria Converts its Non-Voting Juul Shares

Photo: Juul Labs
Altria Group will convert its non-voting shares in Juul Labs to voting shares, pursuant to its December 2018 investment in the e-cigarette manufacturer.
“Altria does not currently intend to exercise its additional governance rights obtained upon conversion, including the right to elect directors to Juul’s board, or to vote its Juul shares other than as a passive investor, pending the outcome of the U.S. Federal Trade Commission (FTC) litigation,” Altria stated in a press release.
In April 2020, the FTC filed an administrative complaint challenging Altria’s minority investment in Juul. Altria believes it has a strong defense and intends to vigorously defend its investment.
“As previously disclosed, Altria expects to account for its investment in Juul under the fair value option. Under this option, Altria’s consolidated statement of earnings will include any cash dividends received from its investment in Juul as well as any changes in the fair value of the investment, which will be calculated quarterly,” the company wrote. “Altria intends to treat quarterly changes in the fair value of the investment as a special item and exclude those changes from its adjusted diluted earnings per share.”
In December 2018, Altria made a minority investment in Juul Labs. In exchange for the investment, Altria received a 35 percent economic interest in Juul Labs through non-voting shares, with their conversion to voting shares contingent on antitrust clearance. Under revised agreement terms announced in January 2020, Altria can designate two representatives to Juul’s board of directors.
November 12, 2020
E-Cigarettes Prevail in Cessation Aids Study

Photo: Milkos | Dreamstime
E-cigarettes showed considerable promise as a smoking-cessation aid during a study in the U.K. that was recently published by Reed Wellbeing.
The health and lifestyle service engaged in a one-year pilot from February 2019 to February 2020 to independently assess the impact of directly supplying e-cigarettes as a form of nicotine replacement therapy (NRT) to up to 200 participants though the One You Haringey stop-smoking service.
Participants were given a choice between NRT, e-cigarettes or Champix. Those selecting e-cigarettes were provided with a device and pods free of charge and were supported to quit in line with treatment guidelines from the U.K. National Centre for Smoking Cessation and Training.
E-cigarettes outperformed both NRT and Champix in first-attempt quits during the trial. The devices achieved a 93 quit rate when used alone and a 72 percent quit rate when combined with NRT. NRT use resulted in a 49 percent quit rate and Champix achieved a quit rate of 57 percent.
Twelve weeks after the trail, 100 percent of e-cigarette users were still refraining from smoking, compared with 96 percent of participants who used e-cigarettes and NRT, 84 percent of those who used NRT and 91 percent of Champix users.
November 12, 2020
‘Juul Nicotine Levels Competitive With Cigs’

Photo: Ethan Parsa from Pixabay
The Juul System may deliver a sufficiently satisfying level nicotine to compete with combustible cigarettes for adult smokers, according to new research.
Published in the journal Drug and Alcohol Dependence, the clinical study compared the nicotine delivery profile of the Juul System with other nicotine-containing products, including cigarettes, to assess their pharmacokinetic profiles. The study found that while the initial nicotine delivery for the Juul System was similar to that of combustible cigarettes, the maximum and total amount of nicotine delivered was lower than that of combustible cigarettes, on par with another ENDS product, and higher than nicotine gum.
“When considering laws and regulations governing nicotine, policymakers should bear in mind that providing a similar nicotine effect and experience to combustible cigarettes is critical to facilitate an adult smoker’s transition away from smoking,” said Mark Rubinstein, vice president of science at Juul Labs in a statement. “E-cigarettes have the potential to displace combustible cigarettes, but only if they deliver nicotine at levels to satisfy smokers.”

November 12, 2020
California Asked to Repeal Flavor Ban

Photo: Denis Hiza from Pixabay
Three e-cigarette advocacy groups are asking California State General Assembly to repeal the state’s ban on flavored vaping products. The group’s leaders say an estimated 900,000 former smokers in California could be forced to switch back to smoking if the bill (CA SB793) is not overturned by referendum or repealed.
Greg Conley
“Unless California lawmakers want to force hundreds of thousands of vapers back to smoking, they need to reconsider this flavor ban,” said Gregory Conley, president of the American Vaping Association (AVA). “While voting for bans may make legislators feel righteous, the reality is that prohibition is failed public policy and never works for adult consumer products.”
The World Vapers’ Alliance, Consumer Choice Center (CCC) and the AVA, which combined represent hundreds of thousands of consumers, sent a letter to members of the California State Assembly members urging them to repeal the flavored tobacco ban bill in California to avoid pushing vapers back to combustible cigarettes.
“Instead of improving public health by reducing the number of smokers, this law will have the opposite effect: more people smoking again,” said Yaël Ossowski, deputy director at the CCC. “Moreover, these measures will push people into the illegal market and will also have a disproportionate impact on people of color, who overwhelmingly prefer flavored products and would suffer the most from criminalization and over-policing in our local communities.”
November 12, 2020
EU to Impose Tariffs on American Tobacco

Photo USTC
The EU is set to impose new tariffs on American tobacco this week.
In response to a fight over how much aid is given to airplane manufacturers, the EU had indicated about a month ago that it would seek approval from the World Trade Organization for retaliatory tariffs against the United States.
The new tariffs will include a 25 percent tax on American agricultural goods; on that list are “tobacco, nuts and seeds, spirits, sauces, soups and syrups, self-propelled shovel loaders, tractors and proteins,” according to The Wall Street Journal.
The EU is the world’s second-largest importer of U.S. tobacco.
Though the trade war has focused on aviation, American agriculture has been seen by the EU and by China as a particularly vulnerable sector to hit, both for its importance to the American economy and because farmers are generally seen as part of President Donald Trump’s base.
American tobacco farmers are already suffering from tariffs imposed by China as part of an ongoing trade dispute.
EU leaders are reportedly optimistic that President-Elect Joe Biden’s incoming administration will be more amenable to ending the trade wars than the current administration, but with American tariffs on European Airbus planes already in place, the EU felt it had no choice but to institute tariffs of its own.
November 11, 2020
New Zealand’s Vaping Rules Takes Effect

Photo: Tobacco Reporter archive
Vaping in now illegal in many public places for Kiwis. New Zealand passed the Smokefree Environments and Regulated Products (Vaping) Amendment Act in August, with restrictions to be phased in over a 15-month period.
The first raft of measures, which began on Nov. 11, prohibit the use of e-cigarettes in workplaces, schools, early childhood education and care centers, according to an article in The Daily Mail.
Nancy Loucas, Director of Aotearoa Vapers Community Advocacy, encouraged New Zealand’s 200,000 vapers “to think a little more” before they vape.
“The general rule is if you wouldn’t smoke there, you shouldn’t vape there,” she said. “The likes of shopping malls, and around schools and childcare centers are a no no. At the same time, many councils have made their outdoor city center areas and council parks vape-free as well.”
New Zealand’s new act also prohibits advertising and sponsorship related to vaping products. But the AVCA is concerned treating vaping like smoking will lead to further stigmatization.
“Employers will still be able to permit vaping in a company vehicle, with some very workable provisions in place,” Loucas said. “Patients in hospital care or rest home residents can vape within a dedicated room for vaping, provided there is the likes of adequate ventilation. At the same time, a good employer would dedicate an outside area to vaping, where employees feel comfortable taking a vape break. Vaping is now effectively banned where smoking is, but it’s by no means banned outright. Instead, it’s finally a totally legalized activity for New Zealand adults, albeit now more tightly regulated.”

November 11, 2020
Cashless Lowers Hurdle to Higher Prices

Photo: Colleen Williams
The rise of cashless payments in Japan is helping breach an invisible barrier to raising cigarette prices, according to an article in Nikkei Asia.
Japan’s tobacco companies have long held on to an unwritten rule to never raise the cost of a pack of cigarettes above ¥500 ($4.79), the domination of the country’s most valuable coin.
That barrier allowed for easy transactions. A consumer could walk into a shop, slap loose change on the counter and walk away with a pack.
The penetration of cashless transactions, however, has eased price sensitivity, according to Naohiro Minami, chief financial officer at Japan Tobacco.
After the company raised the cost of some cigarette products by ¥50 on Oct. 1, it experienced less “rush demand” than anticipated.
Driven in part by the coronavirus pandemic, cashless payments reached a 27 percent of all transactions last year, according to data from the Ministry of Economy, Trade and Industry (METI). Compared with other nations, however, Japan’s rate of cashless transactions remains low. Great Britain and China boast more than 60 percent penetration, according to METI, and the proportion in South Korea is above 90 percent.
November 11, 2020