Tag: International

Record duty-free event
This year’s TFWA Asia Pacific Exhibition & Conference, the 22nd such event to he held, attracted the largest number of visitors ever.
The event was held at the Marina Bay Sands Expo and Convention Centre in Singapore from May 7 to 11.
This year the event saw 3,087 visitors from the duty free and travel retail industry come through its doors, a figure that was up 6.0 percent from the 2,905 who attended the event in 2016, and up 19.1 percent from the 2,591 of 2015.
‘These figures included representatives from 1,220 companies, up by three percent from 1,186 in 2016 and up by 16.9 percent from 1,044 in 2015, a TFWA press note said.
‘There were 1,273 key buyers at this year’s event, an increase of 18 percent from 1,081 in 2016 and up 29.1 percent from the 986 in 2015. Attendees from 301 companies increased by 10.3 percent from the 273 in 2016 and rose 16.2 percent from the 259 in 2015.
‘The exhibition occupied a total of 10,254 square metres, up four percent from 9,817 square metres in 2016.
‘A total of 316 companies exhibited, up two percent from 310 the previous year; 76 of these companies were new exhibitors.’
“We were delighted to see record figures across all key parameters at this year’s TFWA Asia Pacific Exhibition & Conference,” said TFWA president Erik Juul-Mortensen. “If ever we needed it, the event was confirmation of the huge importance of this region to the great industry that is duty free and travel retail.”
May 12, 2017
Vapor pushing out smoke
Japan Tobacco Inc’s domestic cigarette volume sales during the three months to the end of March, at 23.0 billion, were 15.3 percent down on those of the three months to the end of March 2016, 27.2 billion.
JT reported today that the volume reduction was down mainly to the overall industry decline, which was partly caused by an increase in the vapor-product category.
‘Core revenue declined 10.4 percent [from ¥160.6 billion to ¥143.9 billion] due to the impact from the sales volume decline partially offset by the benefit from the retail price amendment of Mevius last year,’ the company reported.
‘Adjusted operating profit declined 13.0 percent [from ¥65.7 billion to ¥57.2 billion] due to lower core revenue and despite benefits from cost reduction initiatives.’
Meanwhile, Japan Tobacco International’s shipment volume during the three months to the end of March, at 91.7 billion, was down by 2.9 percent on that of the three months to the end of March 2016, 94.4 billion. At the same time GFB (global focus brands) volume fell by 0.5 percent from 66.4 billion to 66.0 billion.
JT said that JTI’s volume decline had been caused by industry-wide contractions in some markets, market share loss in the face of competitor-driven price discounting in the Commonwealth of Independent States, and unfavorable trade inventory adjustments when compared with the situation during the first quarter of last year.
‘GFB shipment volume was stable but grew excluding inventory adjustments, supported by strong performance in Iran and Taiwan,’ the company said. ‘Year-on-year total and GFB market shares increased in several key markets.
In US dollars, JTI’s core revenue at constant currency was said to have been stable at US$2,469 million [in Yen it was down 3.1 percent from ¥284.7 billion to ¥276.0 billion] as price/mix gains in several key markets offset the volume decline impact.
‘Adjusted operating profit at constant currency grew 1.5 percent [in Yen it was down 7.6 percent from ¥99.5 billion to ¥92.0 billion] driven by price/mix gains and cost reduction benefits including contribution from the manufacturing footprint optimization; while investments in emerging markets and emerging products continued.
‘On a reported basis, core revenue and adjusted operating profit declined 1.6 percent and 6.1 percent, respectively, due to unfavorable currency movements.’
“We are making good progress towards achieving our full year profit target,” said Mitsuomi Koizumi, JT’s president and CEO in presenting the company’s consolidated results.
“This quarter was impacted by unfavorable comparisons due to one-off specific factors in the previous year, but our underlying business performance and financial results were in line with our expectations.
“The international tobacco business delivered steady profit growth at constant currency, in a challenging operating environment.
“At the same time, we reaffirmed our robust operating base in the Japanese domestic tobacco business as assumed.
“It is encouraging that the pharmaceutical and the processed food businesses continued to contribute to the Group.
“I’m confident that we can achieve our full year target while continuing to invest for future sustainable growth amid a continuously challenging business environment.”
May 10, 2017
GFN program complete
The organizers of the Global Forum on Nicotine (GFN) have said that the program for the 2017 event is complete.
The GFN is due to be held at the Marriott Centrum Hotel, Warsaw, Poland, on June 15-17.
The main GFN program, which is scheduled for June 16 and 17, will examine the rapidly developing science in relation to nicotine use and the changing landscape, including policy responses and the influence of different stakeholders in this.
The program will comprise plenary sessions, symposia, panel discussions and poster presentations – including video posters.
June 15 is scheduled to include the Michael Russell oration, and satellite and side meetings, including one for consumers organised by the International Network of Nicotine Consumer Organisations.
It will include, too, the first International Symposium on Nicotine Technology designed to showcase the latest technological advances in alternative nicotine delivery systems, next generation devices and the science behind them (http://isontech.info/).
The program is at: https://gfn.net.co/2017/programme-details.
The speakers and chairpersons are at: https://gfn.net.co/home-2017/bios/.
May 8, 2017
WTO upholds plain packs
Australia’s standardized tobacco packaging law has been upheld by the World Trade Organization after a five-year legal battle, according to a story by Tom Miles and Martinne Geller for Reuters.
The Reuters story cited a Bloomberg news report that, in turn, cited ‘two people familiar with the situation’.
Although the WTO’s ruling is not expected to be made public until July, a ‘confidential draft’ said Australia’s laws were a legitimate public health measure, Bloomberg was said to have reported.
A spokeswoman for British American declined to comment on the ruling until it was made public, but suggested the complainants would keep fighting.
“As there is a high likelihood of an appeal by some or all of the parties, it’s important to note that this panel report is not the final word on whether plain packaging is consistent with international law,” she said.
A spokeswoman for Japan Tobacco also declined to comment on the ruling, but said the fact that the draft had been leaked was disconcerting and a breach of WTO rules.
“Such breaches completely undermine the integrity of the process, which has not yet run its full course,” she said.
The Reuters story said that the plodding pace of WTO decision-making prompted Australia, which had the backing of the World Health Organization, to complain that its challengers were deliberately stalling the proceedings, producing a ‘regulatory chilling’ effect on other countries wishing to follow its example.
Nevertheless, such a ruling from the WTO is likely to be interpreted as giving a green light for other countries to introduce similar laws in respect of tobacco products.
It could have implications also for other products deemed to cause health problems, such as alcohol, junk food and sugary drinks.
May 5, 2017
Imperial’s volume down
Imperial Brand’s total tobacco volume during the six months to the end of March, at 126.3 billion stick-equivalents, was down by 5.7 percent on that of the six months to the end of March 2016. Stick-equivalent volume is said to include cigarette, fine-cut tobacco, cigar and snus volumes.
During the same period, the company’s Growth Brand volume was increased by 3.2 percent, from 70.7 billion to 73.0 billion.
Imperial’s tobacco net revenue during the six months to the end of March, at £3,716 million, was increased by 9.3 percent on that of the six months to the end of March 2016, £3,399 million.
Tobacco adjusted operating profit increased by 5.7 percent to £1,667 million, while logistics adjusted operating profit increased by 20.6 percent to £82 million, and total adjusted operating profit increased by 6.3 percent to £1,740 million.
Adjusted earnings per share increased by 7.9 percent to 1121.9p, while the dividend per share was up by 10.0 percent to 51.7p.
Commenting on the interim results, chief executive, Alison Cooper, said Imperial was delivering encouraging improvements in share trends in many of its priority markets after significantly stepping up investment behind its “strategy and quality growth”.
“The volume and share gains we achieved with our Growth Brands in the period were particularly pleasing,” she said.
“Our performance is underpinned by the rollout of our Market Repeatable Model, which provides an effective and consistent approach for delivering sustainable quality growth in markets.
“We are deploying this model in e-vapour and believe it can also be successfully applied to drive growth in other consumer adjacencies.
“As expected, first half revenue and profit were impacted by the considerable increase in investment. “In a challenging industry environment, we are delivering against our strategy and remain on track to meet full year earnings expectations at constant currency.
“Cash conversion remains strong and we are delivering another dividend increase of 10 percent.”
May 3, 2017
E-liquids allergy guide
British American Tobacco has published what it calls the first practical guide to the allergy-safe use of ingredients, such as flavourings, in e-liquids.
In a press note issued yesterday, the company said that, as with the use of many flavouring or fragrance-containing consumer products, ‘vaping’ e-liquid had the potential for causing an allergic reaction.
‘An allergic reaction is an overreaction by the body’s immune system to compounds that a person is ‘allergic’ to,’ the press note said. ‘Even if a compound has the potential to cause such a reaction (i.e. it is an allergen), that doesn’t mean it will. Whether an allergic reaction is likely, will depend on the person’s immune system and the amount of the compound used in a product.’
However, some substances were more likely than were others to cause allergic reactions, said BAT.
Flavourings were an important part of the vaping experience and some flavourings were known allergens. But currently, there were no specific allergy-related regulatory restrictions under either the Tobacco Products Directive in Europe or regulations administered by the Food and Drug Administration in the US.
Researchers at BAT had therefore devised a practical approach to assessing and managing the allergy risk associated with e-liquid flavourings and other ingredients (Regulatory Pharmacology and Toxicology http://dx.doi.org/10.1016/j.yrtph.2017.04.003). The guide is said to be a follow-up to the company’s blueprint for the safe use of flavourings in e-cigs, which was published in Regulatory Pharmacology and Toxicology in 2015 (https://doi.org/10.1016/j.yrtph.2015.05.018).
The most common allergy was contact sensitization arising when, for example, nickel jewellery touched the skin. Much less common was respiratory allergy, or ‘chemical asthma’.
“Although respiratory allergy is much less common than skin allergy, the potential adverse effects are much more severe,” said Dr. Sandra Costigan, principal toxicologist at BAT. “Chronic inhalation of respiratory allergens can lead to symptoms ranging from mild breathing difficulties to fatal anaphylaxis.”
‘For skin allergens, the researchers propose a method for estimating the exposures to e-liquid ingredients and quantitatively assessing the risk,’ the press note said. ‘This has then allowed them to work out a concentration of an allergen that is not expected to cause allergy in the person vaping the e-liquid.
‘For skin allergens, putting this into practice is relatively straightforward, as an approach to prevent contact sensitization is well established: The stronger the allergen, the lower the supportable concentration in e-liquid.
‘Additionally, the researchers say any known allergen should be labelled as an ingredient if it is present at 0.1 percent concentration or higher, even if it is established that it can be used safely at a higher concentration. This will help those consumers who already know themselves to be sensitive to certain ingredients to make product choices.’
For respiratory allergens, the authors used a cocoa extract as a case study, because cocoa is used quite commonly in e-liquids. The case study showed the tolerable levels identified for the cocoa extract were not sufficiently high to allow it to perform as an effective flavouring in e-liquid. In the guide, the researchers discuss why this is likely to be an issue for other respiratory allergens as well. And they recommend that respiratory allergens are not used at all.
Furthermore, quoting the low occupational exposure guidelines related to respiratory allergens (aimed at protecting workers against respiratory allergy from unintended exposure to allergens in the workplace), the researchers said it was prudent to exclude all known respiratory sensitizers from e-liquids. As an additional safeguard, if natural extracts were used as flavourings and there was no specific data on whether those extracts were respiratory sensitizers or not, only protein-free versions should be used. This was because most respiratory allergens from natural extracts came from the protein parts.
Food allergens were yet another type of allergen and the researchers recommended the presence of any potential food allergens (that are not already excluded for being respiratory allergens) should be labelled.
‘No two people have the same immune response, which is why it is important to tell people about allergens in a product even if all your data says most people shouldn’t experience a problem,’ said Costigan.
May 3, 2017
Abstracts deadline nears
CORESTA has confirmed that the deadline for the submission of abstracts of papers intended for presentation at its 2017 Joint Study Group meetings is May 19.
The Smoke Science and Product Technology (SSPT) meeting is due to be held at Kitzbühel, Austria, on October 8-12.
And the Agronomy & Leaf Integrity and Phytopathology & Genetics meeting is scheduled to be held at Santa Cruz do Sul, Brazil, on October 22-26.
The invitation for abstract submissions is being made through the CORESTA website at www.coresta.org.
SSPT abstracts can be submitted directly at: www.sspt2017.org.
CORESTA said that authors would receive immediately an e-mail message confirming the successful submission of their abstracts.
They would be informed of the CORESTA Reading Committee’s selection towards the end of June.
May 1, 2017
TFWA Asia event imminent
The organizers of this year’s TFWA Asia Pacific Exhibition & Conference say that a record number of exhibitors has been confirmed for the 2017 event, which is scheduled to be held at the Marina Bay Sands Expo and Convention Centre in Singapore from May 7 to 11.
This year’s exhibition is said to have attracted several new and exciting names including Nanyang Brothers Tobacco Co. Ltd.
‘A total of 317 brand companies will be exhibiting, 76 of which are new or returning after a short break,’ a TFWA press note reported. ‘These numbers are up from 310 exhibitors at TFWA Asia Pacific Exhibition & Conference last year, an increase of two percent, and up almost nine percent from 285 in 2015. The 10,300 m² exhibition space at the Marina Bay Sands Expo and Convention Centre has increased five percent from 9,817 m² in 2016.
“We are delighted that the TFWA Asia Pacific Exhibition & Conference is continuing to go from strength to strength, and our exhibitor numbers suggest we are on track for a very successful week,” said TFWA president Erik Juul-Mortensen.
“These figures also reflect the importance of the Asia Pacific region to our industry and underscore how it is an essential market for all brands in the duty free and travel retail sector.”
Further information about the event is at www.tfwa.com.
April 28, 2017
PMI’s cigarette volumes tumble
Philip Morris International’s cigarette shipment volume during the first quarter of 2017, at 173,552 million, was down by 11.5 percent on that of the first quarter of last year, 196,041 million.
Volume fell in each of the company’s regions: by 7.5 percent to 42,540 million in the EU; by 10.4 percent to 56,574 million in the EEMA (Eastern Europe, Middle East and Asia); by 15.5 percent to 55,142 million in Asia; and by 11.1 percent to 19,296 million in Latin America and Canada
But the company reported, too, a major increase in its shipments of heated tobacco products, which in the first quarter of 2016 amounted to 453 million but which by the first quarter of this year had risen to 4,435 million.
Shipments of heated tobacco products were up from 16 million to 184 million in the EU; from two million to 105 million in the EEMA; and from 435 million to 4,145 million in Asia. In Latin America and Canada, where there had been no shipments of heated tobacco products in the first quarter of 2016, PMI recorded one million in the first quarter of this year.
Shipments of cigarettes and heated tobacco products during the first quarter of 2017, at 177,987 million, were down by 9.4 percent on those of the first quarter of 2016, 196,494 million, with shipments down by 7.1 percent in the EU, by 10.2 percent in the EEMA, by 9.7 percent in Asia, and by 11.1 percent in Latin America and Canada.
‘PMI’s total shipment volume of cigarettes and heated tobacco units decreased by 9.4 percent, or by 7.8 percent excluding net estimated inventory movements, reflecting a challenging comparison with the first quarter of 2016, which declined by a more modest 1.1 percent, as well as ongoing declines of primarily low-price volumes in specific markets, such as
Pakistan and the Philippines,’ the company said in reporting its results. ‘The first quarter of 2016 also benefited from the favorable estimated impact of the leap year.
‘PMI’s cigarette volume decreased by 11.5 percent due to: the EU, principally Italy and Spain, partly offset by Poland; EEMA, mainly North Africa, primarily Egypt and Tunisia, as well as Russia and Ukraine; Asia, principally Indonesia, Japan, Korea, Pakistan and the Philippines; and Latin America & Canada, principally Argentina, Canada and Mexico. ‘The decline in PMI’s cigarette shipment volume was partly offset by higher heated tobacco unit shipment volume of 4.4 billion units, up from 453 million units in the first quarter of 2016, driven by Japan.
Taking cigarette shipments alone, Marlboro shipments of 62,399 million were down by 8.2 percent; L&M shipments of 21,913 million were down by 7.5 percent; Parliament shipments of 9,199 million were down by 9.3 percent; Bond Street shipments of 8,485 million were down by 12.7 percent; Chesterfield shipments of 11,544 million were up by 13.4 percent; Philip Morris shipments of 10,608 million were up by 15.2 percent; and Lark shipments of 6,526 million were up by 0.4 percent. Shipments of other brands, taken together, were down by 26.9 percent to 42,878 million.
PMI said that its reported diluted earnings per share, at $1.02, were up by $0.04 or 4.1 percent on those of the first quarter of 2016.
Adjusted diluted earnings per share, at $0.98, were flat.
Reported net revenues of $16.6 billion were down by 1.4 percent, while net revenues, excluding excise taxes, at $6.1 billion, were down by 0.3 percent.
Reported operating income of $2.4 billion was down by 3.1 percent, while operating companies’ income of $2.5 billion was down by 2.2 percent, and adjusted operating companies’ income of $2.5 billion was down by 2.2 percent.
“Our results were in line with our previously communicated expectation of a relatively weak first quarter, due to lower cigarette volume – primarily related to low-price brands in specific markets where the impact on our profitability was limited – and certain timing factors,” said CEO André Calantzopoulos.
“We are fully on track to deliver our full-year EPS guidance, driven by robust pricing and accelerating IQOS volume growth. We anticipate a combined cigarette and heated tobacco unit volume decline of 3 percent to 4 percent for the full year.
“It is extremely encouraging that already today, despite persistent capacity constraints, 1.8 million consumers have effectively stopped smoking and have switched to our heat-not-burn alternative, IQOS.”
April 21, 2017
Sustainable packaging valued
A new independent study by Smithers Pira amongst major brand owners and retailers in five key European markets has shown resounding evidence of the importance of sustainability in packaging, according to a press note from Pro Carton, which commissioned the study.
Folding cartons were perceived as the most sustainable packaging but there was said to be confusion about the issue of the circular economy and what makes packaging sustainable.
“It is interesting to see how the environmental benefits of cartonboard packaging have been perceived by our target audiences and I am delighted to note that our strengths of renewability and recyclability are now well appreciated”, said Tony Hitchin, general manager of Pro Carton.
The study, which was conducted in France, Germany, Italy, Spain and the UK, was aimed at investigating the views and attitudes amongst major European brand owners and retailers in respect of sustainability in packaging and its importance to the retail business. The main fieldwork for the project comprised a series of 100 in-depth telephone interviews with leading decision makers.
Ninety-six percent of respondents said that the use of sustainable packaging was important to their business, and 52 percent said that it was either ‘very important’ or ‘critical’.
“The top criteria for packaging to be considered ‘sustainable’ were (i) that it is a recyclable material (29.2 percent), (ii) that it uses renewable & abundant materials (19.6 percent), (iii) that it uses minimal lightweight materials (15.5 percent), (iv) that is has a low environmental footprint (8.2 percent) and (v) that it is biodegradable or compostable (5.1 percent)”, Adam Page, global director reports and consultancy, Smithers Pira, was quoted as saying.
A summary of the study The Importance of Sustainability in Packaging can be found at: www.procarton.com.
April 6, 2017