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  • Scandinavian Reports Steady Progress in Seasonally Low Quarter

    Scandinavian Reports Steady Progress in Seasonally Low Quarter

    Scandinavian Tobacco Group A/S reported a steady start to 2026 with its Q1 interim results, marking the first quarter under its new five-year strategy, Focus2030. Management emphasized early execution on priorities, including stabilizing earnings in machine-rolled cigars and smoking tobacco, revitalizing the handmade cigar segment, and expanding nicotine pouches. CEO Niels Frederiksen highlighted that while the quarter is seasonally weak, the company is laying the groundwork for longer-term growth and sustained shareholder value.

    Net sales for the quarter were DKK 1.859 billion ($297 million), down 6% year-on-year, though the decline narrowed to -0.6% in constant currencies, with timing effects and a -5.2% foreign exchange impact weighing on reported figures. Performance was mixed across categories: machine-rolled cigars showed stabilization supported by power brands in Europe, handmade cigars delivered 8% organic growth, and the XQS nicotine pouch brand continued strong momentum with more than 13% market share in Sweden. Profitability remained broadly stable, with EBITDA before special items rising slightly to 17.2% margin and EBIT margin holding at 10.4%, despite a small negative impact from amortization changes.

    Cash generation was solid for the first quarter, with free cash flow before acquisitions of DKK 158 million ($25.3 million), broadly in line with last year despite working capital timing differences. Adjusted earnings per share declined to DKK 1.1 ($0.176), while return on invested capital fell to 7.8% and leverage increased to 3.0x net debt/EBITDA. The company maintained its full-year 2026 guidance, expecting constant-currency net sales growth of -2% to +2%, EBIT margin of 13.0%–14.5%, and free cash flow of DKK 950–1,200 million ($152–192 million), signaling confidence in its ongoing strategic transition.

  • Sri Lanka’s Beedi Industry Under Attack

    Sri Lanka’s Beedi Industry Under Attack

    Sri Lanka’s Parliamentary Committee on Ways and Means called for stronger action to curb the illegal import of beedi leaves, warning that smuggling is eroding government tax revenue and undermining the legal beedi industry. During a recent meeting chaired by MP Wijesiri Basnayake, officials said large quantities of leaves are being brought in by sea to avoid import duties, despite existing enforcement efforts. The committee urged measures to stop industry participants from using illicit supplies and directed Finance Ministry officials to develop a mechanism to safeguard tax collection.

    Officials from the government, police, and navy discussed enforcement options. Lawmakers stressed the need to balance revenue protection with safeguarding employment in the beedi sector while tightening controls on illicit imports.

  • Australia Moving to Ban R&D Tax Credits on Tobacco, Gambling  

    Australia Moving to Ban R&D Tax Credits on Tobacco, Gambling  

    Australia is moving to block tax incentives for research tied to the gambling and tobacco industries under new legislation introduced in the Lower House today (March 25). Assistant Treasurer Daniel Mulino said the measure would prevent taxpayers from subsidizing research that could worsen addiction and other health harms. The exclusion applies to all types of gambling- and tobacco-related R&D, though a carve-out ensures that studies aimed at harm reduction — such as addiction prevention or cessation strategies — remain eligible for R&D tax offsets.

  • Malaysian Illicit Cigarette Rate Still Above 54%

    Malaysian Illicit Cigarette Rate Still Above 54%

    The Confederation of Malaysian Tobacco Manufacturers (CMTM) said the latest Illicit Cigarettes Study conducted by NielsenIQ shows illicit cigarette incidence in Malaysia remains high at 54.4% in 2025, a marginal 0.6%-point decline from 2024. CMTM credited enforcement agencies, including the Royal Malaysian Customs Department and the Royal Malaysian Police (PDRM), for intensified border controls and supply chain disruption efforts.

    However, the association flagged rising concern over cigarettes bearing fake tax stamps (FTS), with national incidence increasing by 1.7 percentage points year-on-year and wider penetration reported in Johor, Penang, Melaka, Terengganu and Kelantan. The group urged stronger action to remove such products from the market and reaffirmed its commitment to working with authorities to protect regulatory integrity as illicit trade tactics evolve.

  • Korea to Regulate Synthetic Nicotine as Tobacco

    Korea to Regulate Synthetic Nicotine as Tobacco

    South Korea announced today (Feb. 3) that it will extend full tobacco regulatory controls to synthetic nicotine liquid e-cigarettes from April 24, bringing them in line with conventional tobacco products following amendments to the Tobacco Business Act and National Health Promotion Act. The measures require manufacturers and distributors to include graphic health warnings on packaging and restrict advertising to limited channels, while banning promotional content targeting women or minors or highlighting flavors. The revised framework also prohibits the use of all tobacco and nicotine products, including e-cigarettes and heated tobacco, in designated smoke-free areas, with violations subject to fines of up to 100,000 won ($69). The regulatory expansion, the first major update to the tobacco definition since 1988, aims to close loopholes that previously allowed synthetic nicotine products to be marketed and sold with fewer controls, particularly amid concerns around youth access and public health risks.

  • Zimbabwe Tells Tobacco Farmers to Stop Planting, Get Tending

    Zimbabwe Tells Tobacco Farmers to Stop Planting, Get Tending

    This week, Zimbabwe announced that it exceeded its tobacco planting target for the 2025/26 season, surpassing a record 140,000 hectares, prompting the government to urge farmers to halt further planting and focus on crop management to maximize yields and leaf quality. Agriculture Permanent Secretary Prof. Obert Jiri said late-planted dryland tobacco should be curtailed, with emphasis now on pest and disease control, weed management, and split fertilizer application amid heavy rains. A national crop and livestock assessment later this month is expected to confirm strong early performance and yield prospects, with fertilizer supplies largely adequate despite short-term top-dressing delays.

  • Overseas Seizures Show Korea Used as Tobacco Smuggling Hub

    Overseas Seizures Show Korea Used as Tobacco Smuggling Hub

    South Korea’s customs agency said millions of packs of smuggled cigarettes were seized overseas last year through joint operations with foreign authorities, underscoring the country’s growing use as a transshipment hub by international smuggling networks. The Korea Customs Service (KCS) said nearly 5.2 million packs, weighing about 103 tons, were confiscated abroad after being routed through South Korea.

    According to the KCS, major seizures included roughly 760,000 packs in the United States, 380,000 in Hong Kong, 260,000 in the United Kingdom, and 230,000 in Taiwan. The total far exceeds the 3.6 million packs detected overseas between 2019 and 2021, highlighting a sharp rise in cases linked to Korea-based transit routes.

    A KCS official said cigarette smuggling, like drug trafficking, is a key funding source for criminal syndicates. The agency said it will further strengthen international cooperation to prevent South Korea from being exploited as a logistics hub for global illicit trade.

  • Europe Helping Offset China Losses in Zimbabwe’s Tobacco Exports 

    Europe Helping Offset China Losses in Zimbabwe’s Tobacco Exports 

    Zimbabwe’s tobacco exports dipped 0.7% from the previous year to $1.36 billion (as of mid-December), thanks in part to exports to China dropping from $953.2 million to $819.3 million. Despite the 14% decline, the Far East still accounted for 60% of the nation’s total tobacco export value, all data according to the Tobacco Industry and Marketing Board (TIMB).

    While traditional Asian markets cooled, a massive surge in European demand and steady growth within Africa helped offset the overall decline. The European Union emerged as the standout growth market this season, with export values skyrocketing by 64.5%, going from $103.1 million to $169.6 million. According to the TIMB, the surge reflects a growing preference for Zimbabwe’s high-quality, flue-cured Virginia leaf among continental manufacturers.

  • France Seizes 15 Tons of Tobacco in International Ring Bust

    France Seizes 15 Tons of Tobacco in International Ring Bust

    French authorities dismantled an international tobacco trafficking network linked to Bulgarian nationals following a year-long investigation that began in July 2024 with the seizure of 15 tons of illicit cigarettes in western France. The operation uncovered a structured smuggling route moving illegal cigarettes from Italy and Bulgaria through France to Belgium. Investigators later seized 450 kg of cigarettes and 14.7 tons of raw tobacco at a warehouse near Brussels.

    Earlier this month, police arrested the suspected convoy organizer and two lorry drivers, confiscating nearly 30 tons of counterfeit cigarettes from two trucks. Six people associated with this network have been charged with organized tobacco trafficking, criminal conspiracy, and money laundering, with three Bulgarian suspects placed in provisional detention.

  • South Korea to Define All Nicotine Products as ‘Cigarettes’

    South Korea to Define All Nicotine Products as ‘Cigarettes’

    South Korea’s Cabinet moved to close regulatory and taxation gaps surrounding liquid e-cigarettes, including those using synthetic or nicotine-substitute substances, amid what is says are growing safety concerns. At a Cabinet meeting today (December 16) chaired by President Lee Jae-myung, the government approved the promulgation of amendments to the Tobacco Business Act that legally classify liquid e-cigarettes as tobacco products. The revised law expands the definition of cigarettes from products made from tobacco leaves to all products containing tobacco or nicotine, bringing synthetic-nicotine liquid e-cigarettes under formal regulation.

    President Lee highlighted concerns that nicotine substitutes have been distributed without adequate safety verification and called for stronger institutional oversight. Reports of suspected lung damage linked to liquid e-cigarettes were also raised during the meeting.

    Deputy Prime Minister and Finance Minister Koo Yoon-cheol said products released four months after the law takes effect will be regulated and taxed as cigarettes. However, he noted regulatory limits regarding so-called “nicotine-free” products manufactured before the law’s implementation, stressing the need for separate management and hazard assessments.

    The revision aims to eliminate regulatory and taxation blind spots while gradually strengthening safety management for nicotine substitutes.